It’s a common tactic among groups promoting climate alarmism and anti-hydrocarbon policies. As evidence mounts that manmade catastrophic climate change is not imminent, extreme weather events cannot be linked to human activities, and developing nations will not reduce their use of fossil fuels, radical groups have increasingly targeted companies with campaigns based on supposed ethical principles.
A recent target is the J. M. Smucker Company, maker of jams, syrups, and Dunkin’ Donuts, Folgers, Kava and Millstone coffees. Calvert Investment Management and Trillium Asset Management bought enough shares to entitle them to introduce agenda-driving resolutions at shareholder meetings.
The activists’ August 2011 resolution demanded that Smucker explain how climate change will affect temperature and rainfall patterns, the supply and price of coffee, and thus investors. Seventy percent of Smucker voters rejected the resolution, but the activists parlayed the vote into several press releases designed to harass and eventually intimidate the company into complying with their climate change mantra, as well as “sustainability,” “fair trade” and “certification” demands.
Each demand advances similar goals: coerce companies to pressure politicians to adopt the activists’ agenda; silence corporate support for opposing viewpoints; and increase the activists’ revenue stream, by “persuading” the company to pay them hefty fees for “official certifications” that corporate practices and purchases adhere to the activists’ politicized standards on various “ethical” matters.
Climate change. Calvert and Trillium correctly observe that temperature, rainfall and other climate variability affects changes in coffee yields around the world. Ditto for all crops, one might add.
However, for them to assert that climate changes result primarily from human carbon dioxide emissions is a matter of ideological belief, not scientific fact. Climate changes; it always has and always will – on regional and sometimes global scales. Greenhouse gases exert a warming effect; but how much, especially in the context of countless planetary, solar and other forces, is a matter of intense debate.
Calvert and Trillium can certainly find support for their views among IPCC and Climate Research Unit stalwarts. However, other scientists, books and reports present a far less alarmist, far more nature-driven theory of climate change.
The absence of warming since 1998, despite steadily rising CO2 levels, calls into question the entire manmade global warming/climate change/climate disruption hypothesis – especially the assertion that any changes will be catastrophic and can be prevented by slashing the use of carbon fuels that power the vast majority of what people make, ship, eat and do. Climate models begin by assuming that carbon dioxide drives climate change, input rising atmospheric CO2 projections, and (voila) output a warming planet.
Smucker and its coffee growers should certainly prepare for any adverse impacts on coffee production, including heat waves, cold snaps, downpours, droughts, insects and diseases. Traditional breeding and biotechnology can create new strains that better survive these threats, while sound business management practices can help minimize numerous problems. Smucker is already taking steps like these.
Adopting the Calvert-Trillium agenda would undermine efforts to sustain and improve coffee production and the growers’ and company’s flexibility and profitability. The activists’ prescription would reduce energy supplies and increase energy, fertilizer, processing and shipping prices – while also killing jobs, decreasing customers’ living standards, and making them less able to afford quality coffee.
The Calvert-Trillium thesis also contradicts the recent Securities and Exchange Commission “interpretive guidance,” which says companies should disclose not only potential risks and physical impacts from climate change, but also risks and impacts on business from legislation, regulation and international accords enacted to restrict fossil fuel use, in a quest to control Earth’s ever-changing climate.
* Physical impacts of climate change: Even if carbon dioxide has a greater effect on climate than many scientists think, coffee growers and regions would actually benefit from higher atmospheric CO2 levels. More CO2 stimulates plant growth and increases survival rates under drought and other adverse conditions. Moreover, many asserted manmade climate risks are wildly speculative, generated by computers or based on questionable to fraudulent research (as IPCC and Climategate documents have revealed).
* Impacts of legislation, regulation and international accords: Rules that restrict hydrocarbon use reduce energy reliability and affordability, which hurts growers, processors, sellers and consumers alike.
* Indirect impacts on business trends: Many activist claims about damage to businesses are based on the same speculative risks noted above. Well managed companies will carefully separate fact from fiction.
Volume certified sustainable. “Sustainability” is a politicized, malleable and ultimately meaningless concept, developed to promote activist agendas. It assumes manmade climate chaos is real. It claims hydrocarbon resource depletion is imminent, which recent shale gas and conventional discoveries show is hardly the case. It never explains how long resources must last to be “sustainable” (ten years? 50? 100? 1000?) or factors in economic and technological changes that revise depletion calculations upward.
In the case of agriculture, “sustainability” advocates often oppose biotechnology, chemical fertilizers, insecticides and mechanized farming – and favor land and labor-intensive organic and subsistence practices, animal manure and naturally occurring (but often toxic) chemicals. These standards may meet ideological tests, but they don’t necessarily meet scientific, practical or best business practice criteria.
Fair trade. Ethical, socially responsible companies should always be fair to suppliers, customers, employees and everyone else they deal with. “Willing buyer, willing seller” relationships should be based on honesty, transparency and a mutual desire to sustain long-term, mutually beneficial relationships.
However, “fair trade” is really another politicized, malleable, agenda-driven concept. It often demands higher prices for growers, but neglects other important considerations. It can result in coffee that is overpriced in times of high unemployment and economic hardship, when many consumers are looking for affordable beverages on limited budgets – which can ultimately mean less income for growers.
Certifications. Both sustainability and fair trade certifications mean companies pay activists to put a political stamp of approval on targeted merchandize. The process may generate activist and news media accolades for participating companies, while failing to address the issues raised here. However, it certainly enriches activist groups, enabling them to launch pressure campaigns against other companies.
Calvert, Trillium and other “corporate ethics” and “climate disaster” campaigners are closely allied with and/or support organizations that oppose: hydroelectric, coal, gas and nuclear power generation in coffee-growing and other poor countries where the vast majority of citizens have little or no access to electricity; insecticide use to control malaria and other deadly diseases; biotechnology and other modern agricultural methods to improve human nutrition and replace crops devastated by insects or plant viruses; and progress in general. They are modern-day Luddites, justifying their actions on false ecological grounds.
But still the campaigners say J. M. Smucker should buy coffee “certified” by activists as being green, sustainable and climate-sensitive. Company shareholders should ask: Just because other companies have been conned or pressured into doing so, should Smucker be snookered into following their lead?
Perhaps Smucker Company could test market a little “fair trade” or “sustainable” coffee. It certainly should promote wise use of chemicals, sound business practices, fairness and honesty with all business partners, careful attention to changing climate and rainfall patterns, responsible stewardship of lands, resources and energy, and access by poor families to electricity and other modern technologies.
That would brand the J. M. Smucker Company as a truly ethical and responsible corporation.
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