Corporate social responsibility (CSR) is frequently used as a means of bolstering an organization’s reputation. Of course failed CSR efforts can come back to harm the organization in a boomerang effect. Even when CSR is successful, it creates a unique crisis risk. Once an organization publicly claims to be socially responsible, the organization becomes vulnerable to charges of social irresponsibility. The Reputation Institute estimates that over 40% of an organization’s reputation is related to social responsibility. Hence, once managers claim the organization is socially responsible and draw reputational benefits from that claim, the organization is vulnerable to challenges that claim the organization is acting socially irresponsible. CSR is a form of crisis risk, not just a potential asset before or after a crisis.
Last week, activists and farmer workers marched to the primary Ben & Jerry’s facility in Montpelier, VT. The action is an ongoing concern over whether or not Ben & Jerry’s is honoring its 2015 commitment to Milk with Dignity. Here is how the campaign’s web site describes Milk with Dignity”
“The campaign builds a movement of farmworkers and allies to call on major food corporations to take responsibility for farmworker rights abuses in their supply chains. Farmworkers converted worker’s rights and housing violations into solutions in the creation of the Milk with Dignity Code of Conduct—defining the human rights essential to a dignified workplace and fair housing. Our members also noted that some dairy farms already had most of the Code of Conduct’s standards in place, demonstrating that it is both necessary and possible to raise the bar in the industry through this campaign.”
The activists and farmers feel that Ben & Jerry’s is acting irresponsibly by not really trying to honor their pledge in 2015. Ben & Jerry’s is one of the few corporations built on the concept of CSR, therefore, charges of social irresponsibility can be serious reputational threat. The magnitude of the reputational threat is dependent on the ability of the challengers to make other stakeholders aware of the concern and to convince other stakeholders Ben & Jerry’s is acting irresponsibly. The march was just part of an effort designed create awareness of the dispute and to pressure Ben & Jerry’s to take action thereby eliminating the reputational threat.
Here is Ben & Jerry’s original statement on Milk with Dignity
“June 19, 2015
Ben & Jerry’s shares Migrant Justice’s belief that all farm labor must work under fair, just and dignified conditions. Both parties acknowledge the challenging conditions for farmworkers and family dairy farms in Vermont.
Ben & Jerry’s and Migrant Justice commit to work together to define and detail the rights and responsibilities of Ben & Jerry’s and Migrant Justice under the Milk with Dignity Program.
Ben & Jerry’s is proud of its longstanding relationship with the family farms within its Vermont supply chain. The member family farms of the St Albans Cooperative Creamery share the vision and values and work every day to deliver a dignified life for everyone working in the Vermont dairy industry. Our united vision is to ensure that everyone within Ben & Jerry’s Vermont dairy supply chain work under fair, just and dignified conditions.”
The action is having some effect as Ben & Jerry’s did feel the need to address the situation in May of 2017 with this statement:
“Migrant Justice’s recent release of a timeline documenting past violations of unsafe conditions, wage theft, and inhumane housing for Vermont farmworkers are as shocking today as they were when they were first reported. Even a single incident is serious and unacceptable and must be treated as such. We followed up with various Vermont State officials and the St Albans Cooperative management to understand the context of each allegation and the resolution to each one. We know that at the state level and at the Cooperative we source from, all of the stakeholders are working to achieve safe and dignified conditions for dairy farmworkers. Ben & Jerry’s is deeply committed to the ensuring that all of those who work in our supply chain have safe and dignified working conditions, which is why, in 2015, we committed to implement the Milk with Dignity program on dairy farms that supply our company.
While Ben & Jerry’s has been working to building strong labor standards with our St. Albans Cooperative dairy supply chain for many years, our labor standards within our Caring Dairy program are not worker-driven social responsibility. We appreciate that Migrant Justice has brought forward the importance of a worker-driven program to protect farmworkers’ rights and working conditions. We understand the distinction that the labor standards within our corporate-led program, while robust and creating positive results, are not worker-driven. That’s why we’ve been at the table with Migrant Justice for the past two years working on the details of how to operationalize the Milk with Dignity program across our dairy supply chain. Our intention is that The Milk with Dignity program would replace the labor standards that were embedded in the Caring Dairy program.
We are as disappointed as Migrant Justice with the amount of time this process has taken. We’ve invested much staff time, energy, and effort, all in good faith, to reach an agreement with Migrant Justice. Contrary to the current public narrative, we never left the table in our discussions with Migrant Justice to resolve the Buyer’s Agreement. We remain at the table ready to find a constructive path to a successful conclusion. We are committed to becoming the first dairy company in the country to implement the Milk with Dignity program and remain dedicated to the pledge we made two years ago.
Make no mistake, we’re proud of the work we’ve done over the years in our dairy supply chain and we invite you to learn more about that work here. But we also understand that there is still much work to be done. We hope that soon we can move from discussing to implementing the Milk with Dignity program across our dairy supply chain.”
Ben & Jerry’s do recognize that the activists have a valid point but disagree on the reasons for the lack of progress. The challenge is not over and we can expect both sides to continue creating messages around the issue meaning this CSR reputation threat will continue for Ben & Jerry’s.
Questions to Consider
1. Would other stakeholder view the activists’ concerns over milk legitimate? Why or why not?
2. How effective would you say the response by Ben Jerry’s is for protecting its reputation? What led you to that evaluation?
3. Why might managers forget to include CSR is their assessments of crisis risks?
Coombs, T., & Holladay, S. (2015). CSR as crisis risk: expanding how we conceptualize the relationship. Corporate Communications: An International Journal, 20(2), 144-162.