From the online course: http://www.getting-to-grips-with-cr.com A look at how the company evolved to become an ethics pioneer, and where next?

1. Case Study: Chiquita
From “Octopus” Company to Sustainable Agriculture
Pioneer?
From the “Getting to Grips with CR” online CR course

2. United Fruit: A brief history
• Founded by Minor Keith as United
Fruit Company in 1899
• Early/Mid 20th Century Monopoly
on some countries in Central
America
• These became known as “Banana
Republics”

3. Chiquita: A brief history
• United Fruit known as “El Pulpo”,
The Octopus, by left wing opponents
• Accused of bribery, worker
exploitation, collusion in massacres,
and highly monopolistic tendencies

4. Corporate colonialism?
• Accused of destabilising Colombia
in the 1920s
• “Colluded” with CIA in overthrow
of Arbenz Govt in 1954
• Major influences on Cen. Am.
conflicts & on Gabriel Garcia
Marquez & Che Guevara

5. Corporate colonialism?
• Supporters say UF provided
employment to tens of
thousands
• Paid them nation's best rural
wages
• Offered employees medical care
and rent-free housing
• Six years free schooling for
"countless" children

6. Their supporters also said..
• Cleared and drained
thousands of acres of jungle
- country's most productive
farm lands
• Converted Guatemala into
major banana producer,
ended coffee dependence.
• All of which may be true
• But for critics, the
colonialist way this was
done meant the company’s
role in destabilising central
America far outweighed the
benefits of United Fruit

7. Turning points in sustainability
• Early 1990s begins working with
Sustainable Agriculture Network on
two farms
• Persuaded by activist and now
Rainforest Alliance Sust. agriculture
head Chris Wille to try new
approaches
• Chiquita “founder member” of
Rainforest Alliance

8. Turning points in sustainability
• By 2000 all Chiquita-owned farms
were Rainforest Alliance certified
• Issues covered included: waste,
recycling, working conditions, safety,
housing, sanitation and agri-chemical
replacement. Today company focuses
on all aspects of operations.

9. Not an easy journey…
• 1998 investigation by
Cincinnati Inquirer newspaper
revealed series of ethical
breaches at Chiquita
• Ethics breaches in
investigation meant Chiquita
won damages
• 1998 Company also targeted
by European activist groups
looking to improve banana
supply chain and production
techniques
• 2001 Chapter 11 bankruptcy
protection: Stayed committed
to CR

10. Partnerships and positive change
• Chiquita began, from 2000,
working with independent
suppliers to help improve
practices
• Credited by farmers with
“revolutionising” practices
(RA)
• As of 2009, $20 million
invested has resulted in more
than $100 million in savings
• Trade Union agreement in
2001 with COLSIBA &
International Union of
Foodworkers on labour,
working conditions

11. How to try and communicate complexity

12. Modern Times
• Company has been seen as a model
for CR partnerships
• First with Rainforest Alliance and the
Sustainable Agriculture Network,
secondly with IUF / Colsiba
• Now with ForestEthics to track and
eliminate “Tar sands” oil from
operations
• Also widespread user of SA8000
standards, seen as credible

13. Modern Times
• Still criticised by labour and human rights NGOs:
International Labor Rights Fund in 2013
• Former subsid. Paid Colombian paramilitaries
$1.7m from 1997-2004. Fined $25 million by US
DoJ
• Partnership with RA attacked as “greenwashing”
• In 2008 ALL Lat Am banana operations had
Social Accountability SA8000 certification,
covering 17,000 people

14. Key lessons from Chiquita
• Pilot projects play a key role
• Eat the elephant a bite at a time
• Stakeholder engagement can save
millions in operational
efficiencies
• Partnerships, done right, offer
vital “License to Operate”
• Stakeholder reputational capital
is vital, because something will
always go wrong!
• Critics can emerge at any time…
• For example EthicalOil.org urges
boycott due to Chiquita NOT
buying tar sands oil from Canada!

15. Key lessons from Chiquita
• Past performance provides
knowledge of engagement,
experience of partnerships, but
does not guarantee future
success.
• Company losing money in 2011-
12. ($400m) Will this affect
sustainability in longer term if it
continues?
• Sustainability, like any
management process or
paradigm, is something
companies must do every day,
not once a year. Management
ethos is vital to making it stick.
• Chiquita not reported on CR since
2008, a worrying sign…

16. References and further reading
Rainforest Alliance Chiquita Profile (2009)
Wikipedia: Chiquita Brands International (2013)
Big Fruit. New York Times Book Review (2008)
Partnerships - Partners in sustainability, Ethical Corp
(2012)
Personal interviews, conference presentations and
discussions with company executives, Unions and
NGOs, since 2002
Search Ethicalcorp.com for “NGO partnerships ,
“NGO engagement”, “Rainforest Alliance”
Chiquita – Voluntary disclosure’s banana skin, Ethical
Corp (2008)
Chiquita – Paying the price of honesty, Ethical Corp
(2008)
Ethical Corporation, Stakeholder Engagement Section
International Labour Organisation: The IUF/COLSIBA
– CHIQUITA framework agreement: a case study
Business ethics, Going bananas, The Economist, 2012
Chiquita’s Corporate Responsibility Reports (2008)

17. Want to know more?
This presentation is part of the online CSR training course “Getting to Grips
with CR” which can be found at http://www.getting-to-grips-with-cr.com and
features more than 80 training videos and discussions on global CSR
The course is currently taking place with 70 managers around the world
taking part. The next version will begin in September 2013. For more info or
to sign up contact: Stefan.Jensen@stakeholderintel.com