ANALYSIS: Yum may face unsavory consequences over refusal to getinvolved in third-party dispute

"We are not now nor ever going to get involved in a labor dispute between third parties, says Jonathan Blum, SVP of Yum, parent company of Taco Bell and Kentucky Fried Chicken.

"We are not now nor ever going to get involved in a labor dispute between third parties, says Jonathan Blum, SVP of Yum, parent company of Taco Bell and Kentucky Fried Chicken.

Before I explain why that's one of the dumbest things I've heard a corporate spokesperson say in quite some time, a little context is in order. For several months now, Yum (formerly known as Tricon) has been the target of activists who say it buys tomatoes picked in Immokalee, FL, where workers endure harsh conditions and are paid as little as 40 cents for each 32-pound bucket of tomatoes they pick.

Protesters picketed Yum's annual meeting two months ago, and farm worker Lucas Benitez - his wife and son at his side - told shareholders they could help "end sweatshops in the fields by paying a penny more a pound for tomatoes. Benitez said many migrant workers earned as little as $7,500 a year, with no overtime and no benefits.

Taco Bell "has an opportunity to market itself as the socially responsible company in the fast-food industry, he said. Blum politely declined the opportunity, citing his company's reluctance to get involved "in a dispute between third parties."

It's a poor excuse for many reasons, the first of which is that his company is already involved. It would, of course, be nice if companies could pick which issues they wanted to confront, but the world no longer works that way. If a group of people that can influence the success or failure of your organization - in this case, customers - say you're involved, you're involved. It's your brand people identify with the issue, not that of an obscure picking company in Florida.

There probably was a time when Nike thought it wasn't involved in its subcontractors' labor woes, but it was quickly disabused of that notion.

There probably was a time when Shell thought it wasn't involved in relations between the Nigerian government and the Ogoni people, whose land it was exploiting. Both have since paid millions of dollars to rebuild the reputation capital they lost.

Blum's excuse is also poor because it isn't credible. "Not now or ever," he says. Really? Three universities have already banned Taco Bell products over the tomato issue. If Taco Bell lost even 5% of its customers over this, would Blum still stand on this dubious principle?

What he would have said, more accurately, may have been: "Frankly, we don't think enough customers care about the plight of migrant workers to make a dent in our sales. And we certainly don't give enough of a damn ourselves to sacrifice a few pennies in profits just so these people can have their share of the American dream."

There's nothing principled about Yum's position. It's a cynical business decision. Hopefully, it will be an expensive one, too.

Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Register
Already registered?
Sign in

Would you like to post a comment?

Please Sign in or register.