Supermarkets must address 'supply chain losers'

The pandemic has deepened the divide between winners and losers in the global food supply chain, according to research.

A report by Oxfam highlighted the disparity between the huge supermarket chains delivering profits to shareholders and executives, and the financially precarious and dangerous situations that workers are exposed to.

The study said supermarkets had seen record sales, benefiting shareholders, while supply chain workers and farmers continued to suffer inequality and escalating rights violations.

The report said between 2019 and 2020 supermarkets listed in Oxfam’s Supermarket Scorecard increased total dividends distributed to shareholders by 123%, distributing 98% of net profits to shareholders via dividends and share buybacks.

The report said: “Costs related to Covid-19 reported by the supermarkets pale in comparison to their additional revenues gained and increased shareholder payouts during the pandemic. Few have taken the opportunity to invest in longer-term supply chain improvements to benefit the food producers and workers experiencing extreme hardship due to the pandemic.”

Women have been impacted the most, falling into what the report callede the “precariat trap”, which exposes them to significant economic, social and health risks brought by the pandemic. The gender pay gap and discrimination have also worsened for women food workers, with women losing more income than men during the pandemic.

The report acknowledged some food companies have started to make significant steps toward ending human rights violations in supply chains, but said a greater commitment and investment is needed from US supermarkets.

Oxfam said supermarkets should immediately ensure workers in their supply chains had necessary free PPE. Suppliers should be supported to cope with the pandemic. Companies should end violations of human rights and workers’ rights and address women’s rights issues in supply chains.

Oxfam is calling on food businesses to fundamentally shift business models, integrating sustainability and human rights into purchasing practices, and revising sourcing policies and structures based on the UN Guiding Principles’ human rights due diligence obligations.

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