As the corporate sustainability agenda starts to gain traction even in discount supermarkets, there were always going to be teething troubles.
So it has proven in the case of Lidl, the German discounter. They’ve been recently censured by the Hamburg Customer Protection Agency, due to a complaint by the European Centre for Constitutional and Human Rights and the Clean Clothes Campaign.
The complaint objected to Lidl claiming that:
“We trade fairly! Every product has a story. Who writes this story is important to us. Lidl globally advocates fair working conditions. Therefore, at Lidl, we contract our non-food orders only to selected suppliers and producers that are willing to undertake and can demonstrate their social responsibility. We categorically oppose every form of child labor, as well as human and labor rights violations in our production facilities. We effectively ensure these standards.”
According to the European Centre for Constitutional and Human Rights and the Clean Clothes Campaign: “Textile workers in various Lidl suppliers in Bangladesh reported inhumane working conditions, including excessive overtime with scarce and nontransparent compensation, payroll deductions as punishment, prohibition of trade unions, and discrimination against female workers.”
As a result of the complaint, the Hamburg Customer Protection Agency forced Lidl to withdraw any advertisements saying the above.
Lidl can also no longer indicate their membership in the Business Social Compliance Initiative (BSCI) in their advertising brochures.
This just goes to show how careful companies have to be when it comes to social issues.
Firms have taken many a beating recently over environmental claims and greenwash. Renault is one of those currently suffering from a backlash to marketing hubris.
Clearly lessons can be learned from companies caught out on green marketing. But at least the environment lends itself to measurement a little more easily than social issues.
That’s not to say it’s easy, as we know from climate change and biodiversity measurement attempts to date.
But social issues can be a whole other ballgame.
There’s a lot more subjectivity involved. After all, one man’s freedom fighter is another’s terrorist.
Companies clearly have to be very careful here. Which is why the big brands are so cautious about reporting on supply chain labour conditions. Lidl would have done well to take a leaf from their book.
That’s not to say it can’t be done, to a degree. At least the issues can be debated and interested customers can make up their own minds.
It can’t be done in an advert of course, but it can be done online. Patagonia is making a valiant attempt. Timberland also does a good job of encouraging robust debate. Nike is a little further behind, being one of the best known case studies of irresponsibility (fairly or otherwise) but does publish a factory list, as does GAP.
The point here I suppose is that whilst the top engaged brands are doing some interesting work on encouraging debate (well two of them, perhaps a couple more) most companies are not there yet.
Lidl and other companies starting out would be well advised to look to companies like Patagonia and Timberland for lessons on engaging stakeholders on social issues. This is why they need a good head of sustainable business. I wonder if it will take another problem like the above before they hire one.