- Human rights risks in the agricultural supply chain include food injustice, worker conditions, and pandemic-related health impacts.
- Investors should be concerned about the growing reputational and financial risks associated with poor labour practices in the agricultural supply chain.
- Our collaborative engagement through the FAIRR initiative, which targets the treatment of workers in the meat industry, provides a road map for engagement.
The agricultural supply chain can pose many human rights risks, including forced labour, child labour, low wages, poor health and safety, and physical abuse. From fisheries to plantations and other high-risk operations, working conditions throughout food value chains are vulnerable to climate impacts, the pandemic, and ongoing systemic issues stemming from past mismanagement of human capital risks.
In this article we will focus on three areas to shed light on the role that companies can play in mitigating the human capital risks in the food system. These are food justice, the impact of physical climate change on worker conditions, and the impact of the pandemic on workers, specifically in the meat industry.
Land and food justice
The social inequity of the food system is partly rooted in the systemic racial inequity of access to agricultural land and to affordable, healthy food. Many low-income communities in developed countries live in areas described as ‘food deserts’ for their lack of access to affordable healthy foods. This exacerbates existing inequality.
As part of a collaborative engagement led by the Access to Nutrition Initiative (ATNI), we sent letters to the CEOs of targeted food and beverage companies describing the company’s Global Index 2021 score and outlining investor expectations on nutrition, diet and health. The ATNI index focuses on governance, strategy (including products, affordability and accessibility, responsible marketing and labelling), lobbying and transparency. The collaboration asked these companies to develop a strategy for populations at risk of malnutrition and obesity; to conduct internal audits for delivery of the company’s nutrition strategy; to develop targets around accessibility and the affordability of healthy products; and to set targets to reduce negative nutrients such as sugar, calories, salt or saturated fats.
Physical climate impact on worker health and safety
Agricultural work is labour-intensive and farmworkers can endure very harsh conditions including a lack of sanitation, limited access to water, and exposure to heat. On days when the temperature is very high, workers can suffer from heat rash, heat cramps, heat exhaustion and heat stroke, a potentially life-threatening condition. Rising temperatures across the globe will only intensify these health risks.
We engage with Compass Group, the largest contract foodservice company in the world, on the treatment and experience of its migrant workers in the Middle East. We called for an independent review of the journey made by migrant workers, to examine worker recruitment, onboarding, living conditions and offboarding. Extreme heat also impacts working and living conditions in this region. We have also engaged with Kuala Lumpur Kepong, a Malaysian multi-national, about the health and safety, protection, and wellbeing of migrant workers on its palm oil plantations.
Meat production workers and the pandemic
The pandemic exposed and exacerbated the fundamental and structural human capital risks in the animal farming industry. In 2021, EOS partnered with FAIRR, an investor network seeking to raise awareness of the material ESG risks and opportunities caused by intensive livestock production. In this collaborative engagement, the group targeted the seven largest protein producers globally, the aim being to empower workers and support risk mitigation in three key areas. These were health and safety, fair working conditions and worker representation.
EOS engaged directly with Tyson Foods, focusing on its policies and practices across six main areas: grievance mechanisms, sick pay, distribution of workers across employment contracts, oversight of the governance structure, worker representation, and the engagement of workers on industry trends, such as automation and climate change. In 2022, we will continue to engage Tyson on those areas of the FAIRR assessment where its human capital policies and procedures are lagging or lacking.
Aligned with FAIRR’s requests, investors and their representatives can urge companies to take the following steps to mitigate some of the human capital management and human rights risks in the food system supply chain:
- Empower workers and support health and safety by implementing, and monitoring the effectiveness of, robust grievance mechanisms. They should also permanently provide paid sick leave to all workers, including subcontracted and temporary workers across operating markets, regardless of whether this provision is included in the national legislation.
- Provide mechanisms and oversight to ensure fair working conditions including reviews and the disclosure of the distribution of workers across different contract types, with regular reports to the board on the workforce composition by contract type.
- Improve worker representation, voice and engagement and include workers as important stakeholders in discussions around industry trends and subsequent impacts.
The disproportionate impact of Covid-19 on the meat industry is a cautionary tale of unexpected costs, shrinking production capacity, and disruption of operations and food supply chains globally. Some meat producers are now facing fines, prosecution, investigations, and employee litigation, but the growing reputational and financial impacts associated with poor labour practices are present throughout the agricultural supply chain. Therefore, investors should consider issues ranging from the working conditions of farmers in the field to the impact of Covid-19 on frontline workers in markets and grocery stores. Investors can and should engage with companies across the food value chain to encourage companies to improve worker conditions and ensure that workers have a voice in the decisions and policies that impact them.