Why develop a scorecard?
This initiative draws on Oxfam’s experience developing a scorecard to assess the 10 largest food and beverage manufacturers in our Behind the Brands campaign. We found that an assessment tool of this kind:
- encourages companies to put more information in the public domain so that their performance can be assessed by important stakeholders (including the companies’ customers, suppliers, shareholders, workers in their supply chains, governments, trade unions, and other civil society organizations);
- provides companies with practical key performance indicators (KPIs) to demonstrate to these stakeholders the extent of the progress they are making, and to benchmark themselves against other companies;
- leads to more constructive dialogue with companies because they require Oxfam and the companies to address the details of complex issues;
- encourages constructive competition that drives improvements in a 'race to the top'.
Who are we scoring?
Oxfam identified leading food retailers in the US and Europe for an initial assessment. We mostly selected the largest or fastest growing food retailers in the sector as these were deemed to have the greatest potential leverage on their supply chains. Criteria for selection included revenue, market share of the groceries sector, and growth. We assessed the following companies operating in the US and will repeat the assessments annually
- Ahold Delhaize (parent company to Stop&Shop and Giant)
- Whole Foods
How are we scoring them?
The scorecard indicators were developed following several rounds of consultation with companies, NGOs, other benchmarking organizations and technical experts to determine the issues of most relevance to respecting the rights of people working in supermarket supply chains. The scorecard is divided into four themes: 1) Transparency and Accountability; 2) Workers; 3) Farmers (and other small-scale food producers); and 4) Women. Each theme has eight indicators (except Women, which has seven indicators) and each indicator has three sub-indicators.
Oxfam believes that supermarkets should take responsibility for the social and environmental impacts of all the products they sell. In many cases, their power to achieve change in their supply chains in this regard is likely to be higher with respect to their private label products as opposed to premium brands. However, in assessing the supermarkets’ performance against the indicators, Oxfam has taken into account the company’s policies concerning all the products they sell, regardless of whether these are premium products or private label brands.
Information about a company’s own recruitment and employment practices was not treated as relevant for the purposes of this initiative, with the exception of indicators that refer to a company’s own operations.
Oxfam staff and consultants with expertise in corporate issues and labor rights (the 'assessors') scanned the corporate websites of the 16 companies and those of any subsidiary companies where relevant. They looked for links to topics such as sustainability, corporate social responsibility, supplier policies, or codes of conduct and assessed company annual reports, accounts, and sustainability reports.
Other websites, such as blogs, news reports, and other organizations which work with the company were also treated as valid sources of publicly available information for certain sub-indicators (e.g. 'Senior managers have spoken out on the need for support to small scale producers').
If a company told the assessor that they had certain policies or were involved in certain relevant projects, but could not publish them for some reason—for example, because they involved commercially or politically sensitive information—they were not able to score.
An announcement in a shareholder meeting or other public event could only be counted as publicly available if it was documented and available on a website or in a report for everyone to access, not just the people who were present at the event.
If the assessor found information in the public domain that met the criteria, they selected ‘Yes.’ If no such information was found, or if information was found that only partially met the indicator, the assessors selected ‘No.’ In the case of some indicators, if relevant information appeared only on the website or corporate report of a subsidiary of the company, the assessor selected ‘Subsidiary only.’
If in doubt, assessors said ‘No’ and we asked the company for clarification, or asked them to make the publicly available information more clear.
For each sub-indicator in which the assessor said ‘Yes,’ the company scored a single point. Where only a subsidiary met the sub-indicator, they scored half a point. If a policy or statement that met the indicator appeared only on the parent website, it was assumed that this applies to the whole company and therefore a full point was awarded.
Thematic scores for each company were calculated based on the percentage of the available points achieved by the company in that theme. Similarly, overall scores for each company (used to calculate rankings in some countries) were calculated based on the percentage of the total available points that the company achieved across all four themes. Rankings were based on overall scores rounded to the nearest whole number. Where two companies in a country had the same overall score, they appear on the scorecard graphics alphabetically and Oxfam considers them to have the same rank.
In some cases, a company may have met part of the indicator but did not score as it did not meet all of the necessary criteria. For example, if the sub-indicator asks if the company has made an action plan and committed to report regularly against it, and the assessor found that they have made a plan but not committed to report against it, the company could not score.
This was to ensure consistency across the many companies and countries being assessed. Cases like this are good opportunities to encourage the company to improve – in dialogue with the company the assessor can explain that committing to reporting regularly would earn them a point.
Oxfam believes that by engaging with companies positively and constructively, rather than simply criticizing, we are more likely to bring about positive change in relation to company policy and practice. Companies were approached several weeks before the assessment to make them aware that Oxfam was working on these issues in their food supply chains and that they were going to be assessed. We shared the scorecard tool with them and gave them the opportunity to raise any concerns and ask for clarification about the purpose and process.
After an initial assessment, companies were given four weeks to comment or alert assessors to publicly available information they may have missed. They also had the chance to publish new, relevant information for the assessors to take into consideration for the final assessment. Companies were given a strict deadline by which they needed to publish new information, after which date it would not count towards this year’s assessment. Companies were also able to ask assessors for further explanation of certain indicators.
Assessments were reviewed in light of new information and clarifications from companies and the final assessments used to compile the scores. Companies were given advance notice of the intention to publish the scores.
The four themes
The UN Guiding Principles on Business and Human Rights (UNGPs) state that: “The responsibility to respect human rights requires that business enterprises have in place policies and processes through which they can both know and show that they respect human rights in practice.” Showing involves communication, providing a measure of transparency and accountability to individuals or groups who may be impacted and to other relevant stakeholders, including investors.
By asking food retailers to be transparent about their policies and practices, we are seeking to encourage good practice in protecting, respecting, and fulfilling human rights in global food supply chains.
What is more, in the information age, consumers not only care about how the people who produce their purchases are treated, they are also increasingly able to find out whether or not workers and producers are being subjected to economic exploitation, or are able to earn wages that allow them to enjoy a decent standard of living.
Some companies, encouraged and supported by civil society, have demonstrated a degree of leadership in being transparent and conducting due diligence. However, companies with considerable leverage in their supply chains can and should go further in being transparent about where they source from, what they expect from their suppliers and how their own policies enable–rather than hinder–suppliers' efforts to meet these expectations.
Doing so will not only help them to meet their obligations under the UNGPs, it will also strengthen the sustainability of their supply chains and enhance the reputation of the company with consumers and investors.
Around the world, tens of millions of people are working in global food supply chains, demonstrating the potential for the private sector to contribute to the fight against poverty and inequality. However, these jobs are not equally to the benefit of workers–falling along a spectrum from forced labor at one end to decent and fairly remunerated work at the other.
Oxfam’s extensive new research reveals numerous examples of labor rights violations in supermarket supply chains. From dire working conditions endured by women picking fruit and vegetables in southern Italy, to exposure to dangerous chemicals on pineapple plantations in Costa Rica, and poverty wages paid to tea pickers in India, our research confirms a widely documented conclusion: Workers around the world are suffering in order to stock supermarket shelves.
Indicators under the 'Workers' theme assess the extent to which supermarkets have put in place measures to ensure workers' rights are respected. Critical in this regard is addressing the role of supermarkets' own purchasing practices in squeezing suppliers on labor costs, supporting the establishment of adequate minimum wages in sourcing countries, and supporting the right of their suppliers' workers to freedom of association and collective bargaining.
It is notable that in many countries from which supermarkets source, the bargaining power of workers has been either suppressed or eroded in recent years.
- In several countries, minimum wages do not exist. Even where they have been established, they are nearly always set at a level far below that needed to support the right to an adequate standard of living.
- The 2017 International Trade Union Confederation (ITUC) Global Rights Index found that the number of countries in which workers experience physical violence and threats rose by 10% in just one year. Attacks on union members were recorded in 59 countries. Over three-quarters of countries deny some or all workers the right to strike.
This is not the first time Oxfam has raised the issue. Our 2015 report In Work but Trapped in Poverty provided evidence that workers in numerous sectors around the world, mostly women, continue to work hard, but remain trapped in poverty producing food (and garments) for consumers. Oxfam believes that everyone must gain a fair share of the economic value their work helps to generate, sufficient to live decent lives, and save for the future.
The vast majority of farms in the world are small-scale, and farming is critical to the livelihoods of hundreds of millions of the world's poorest people. The growth of global food supply chains over the past 20 years has provided new markets and opportunities for economic empowerment for some, but as Oxfam's Ripe for Change report shows, for many of those producing for supermarket supply chains a tipping point is being reached in which the very viability of their livelihood is threatened.
As the research in the Ripe for Change report shows, there has been a long-run decline in export prices for several food commodities which, coupled with often rising costs of production, means small-scale farmers struggle to make profits adequate to support a decent standard of living for them and their families.
For example, export prices have declined around 60% over the past 20 years in the case of Kenyan green beans, or around 90% in the case of Brazilian orange juice. In both countries, the numbers of small-scale farmers have declined markedly, with large-scale plantations using hired labor increasingly taking their place in global supply chains.
Indicators under the 'Farmers' theme assess the extent to which supermarkets have put in place measures to ensure farmers' rights to a decent standard of living are respected. Critical in this regard is ensuring that supermarkets' own purchasing practices do not undermine the viability of small-scale agriculture (for example by paying producers below their costs of production, or offering only short-term contracts), encouraging small-scale producers to organize collectively, and advocating for small-scale farmers to receive adequate government support.
Women make up a large proportion of workers in the food and agriculture sector. Yet because of entrenched gender norms around the world, women are particularly concentrated in the lowest paid and least secure roles in global food supply chains.
Expected to undertake the majority of unpaid care work in the home, women's access to permanent and more senior roles is often limited. Women are further excluded from even basic benefits available to many men such as minimum wages, sick pay, or pensions.
Even where women are in formal roles, they face additional barriers to realizing their rights. As detailed in Ripe for Change, many report, for example, facing the risk of sexual harassment or violence from male supervisors, pregnancy testing as a condition of employment, or discrimination over pay and progression.
Companies that source from countries where gender inequality is endemic to the culture may feel they will not be able to influence how women in their supply chains are treated. However, workplaces are controlled and structured environments into which new information, expectations, skills and structures can enter.
Indicators under the 'Women' theme assess the extent to which supermarkets have put in place measures to address the specific human and labor rights impacts on women in their food supply chains. Critical in this regard is adoption of the UN Women's Empowerment Principles, tracking and disclosing key gender-disaggregated data around women's work and conditions, and incentivizing suppliers to address the root causes of gender inequality.
For a full breakdown of the indicators and how each company scored on each, click here.