A little while ago we talked about shareholder power, and an effort to force Tesco to adopt a policy of paying living wages to suppliers. To update you on how that went, it was moderately successful – it didn’t pass, but it did get voted on. No independent shareholder has ever got a motion on the table, so it’s a first even if it was unsuccesful. And with the press writing headlines like ‘Executives on the rack at Tesco AGM‘, it’s raised awareness of the issues if nothing else.
What’s crazy is that the board asked the members to approve their payrise, and asked them not to approve the plan to pay fair prices to suppliers.
Ben Birnberg, who got the issue on the agenda, summed it up very elegantly. “There is nothing that lowers a company more in the estimation of right thinking people generally … than a public display of executive greed in an affluent world going hand in hand with a public display of corporate miserliness and indifference towards those at the bottom in an impoverished world who contribute so munificently to our corporate wealth.”
Tesco’s response? Chief Executive Terry Leahy told his shareholders: ‘People believe low prices mean that somebody somewhere is suffering as a result. That’s not the case at Tesco. We have in place the most rigorous auditing process of any retailer in the world.’
Somehow he was able to say this with a straight face. In the same meeting, a visiting delegate from a fruit farm in South Africa made this plea: “Our children still go hungry. We don’t want to beg and borrow to stay alive. We are asking Tesco to give us what we deserve. We just want to live a life of dignity.”
That’s not the case at Tesco? Shame on Mr Leahy for his hypocrisy, and on the Tesco shareholders for not calling him to a higher standard.