Walmart’s corporate spin can’t defend shady food suppliers

As the world’s largest retailer, Walmart is constantly in the news. Recent stories deemed worthy of attention by journalists include relaxing the worker dress code and increasing store temperatures by one degree in response to complaints.

But while Walmart’s public relations department attempts to distract the media with such petty matters, a new report from the Food Chain Workers Alliance (FCWA) uncovers far more important problems than wardrobe. The report, “Walmart at the Crossroads: the Environmental and Labor Impact of Its Food Supply Chain” (PDF), dives into the labor and environmental records of 22 of Walmart’s suppliers of popular food items, from chicken to bread to blueberries. 

The company has a history of broken promises, but the disturbing findings of this report take the big-box retailer’s hypocrisy to whole new level.

According to Walmart’s “ethical sourcing” standards (PDF), all suppliers and their manufacturing facilities at a minimum “must fully comply with all applicable national and/or local laws and regulations, including but not limited to those related to labor, immigration, health and safety, and the environment.”

But the report finds that Walmart has failed to enforce supplier compliance with its code of ethics for labor practices, environmental sustainability and local sourcing of food. Workers in Walmart’s stores and in its food supply chain endure a slew of labor abuses, including gender and racial discrimination, unfair treatment of immigrants, low pay, violations of freedom of association and even workplace accidents and fatalities.

Walmart has set a rather low bar for the labor standards of its suppliers:

All labor must be voluntary. Slave, child, underage, forced, bonded or indentured labor will not be tolerated. Suppliers shall not engage in or support trafficking in human beings.

Yet the company has failed to meet it. Last year, for instance, a large seafood supplier to Walmart was exposed for its ties to slave labor. Thailand-based seafood exporter Charoen Pokphand Foods bought fishmeal for its farmed shrimp from some suppliers that own, operate or buy from fishing boats manned with slaves. The Guardian reported that “large numbers of men [were] bought and sold like animals and held against their will on fishing boats.”

In addition, Rose Acre Farms, a major Walmart egg supplier was sued in 2012 by the U.S. Department of Justice for discriminatory practices against newly hired non-U.S. citizens, requiring additional or different security documents than what is legally required. In addition, in 2013, the Equal Employment Opportunity Commission reported that another major egg producer, Cal-Maine Foods, violated federal law by “subjecting an African-American employee to racial and sexual harassment and retaliation.”

For years, labor advocates have challenged Walmart to pay its workers a living wage. To its credit, the corporation recently announced some small increases in base wages. But Walmart refuses to set a living wage as its standard, and for many of its suppliers’ workers, decent pay remains elusive. 

When it comes to foreign imports such as bananas, which are consistently ranked the most popular fruit in the U.S., Walmart has an especially important role in ensuring responsible practices: It purchase a staggering one billion pounds of bananas annually. And yet, according to the FCWA report, three major suppliers, Chiquita, Del Monte and Dole, have demonstrated harmful labor practices. While Chiquita has been praised for having a high percentage of unionized workers, its suppliers have ignored worker complaints. Del Monte has fired workers and rehired only those that accept wage cuts, and Dole has prioritized the hiring of temporary workers to save on benefits it would otherwise have to pay direct employees.

Walmart is also no stranger to sustainability hype that falls far short of real results. As the report details, in 2005, Walmart’s then CEO H. Lee Scott Jr. announced that the company would “be supplied 100 percent by renewable energy.” Yet by April 2015, renewable energy accounted for only 16 percent of Walmart’s total U.S. energy consumption.

Moreover, in 2010, Walmart announced that it would cut 20 million metric tons of greenhouse gas emissions from its supply chain by the end of 2015. As of March 2015, however, Walmart has achieved only 38 percent of its goal, with just 7 months left in the plan.

Walmart has also been cited repeatedly for violations of the Clean Water Act and the Federal Insecticide, Fungicide, and Rodenticide Act, despite clear guidelines in its code of conduct for compliance with all laws pertaining to disposal of hazardous and air emissions. These breaches are a sharp contrast to corporate claims that “environmental sustainability has become an essential ingredient to doing business responsibly and successfully.”

In an attempt to jump on the local-food bandwagon, in 2010 Walmart announced that by the end of 2015, it would sell $1 billion worth of local food sourced from one million small and medium farmers, and increase the income of those same farmers by 10 to 15 percent. Called its “Heritage Agriculture” program, Walmart also made several country-specific commitments to local and small farmers, for example, in India and China.

But five years later, there is no mention of the program on its corporate website after 2010 and the link in the original announcement points to the home page, a sure sign that the program was not developed as promised.

Walmart has more than 11,000 stores in every state and in 27 different nations, and food currently accounts for more than half of its sales, representing roughly 25 percent of all groceries sold in the U.S.

It’s high time for the retailer to own up to its lapses in labor and environmental standards and take action to ensure that workers throughout its supply chain are treated fairly. At a minimum, Walmart should make sure its suppliers are following the law. Doing so would help workers a lot more than relaxing the dress code.