Nestle, Slavery, and Consumer Cost

business_ethics_highlights_2The story below is about Nestle’s reaction to an Australian bill requiring companies to report on the risk of slavery in their supply chains. Nestle is pointing out that additional reporting means additional costs, and that in some cases those costs are going to be passed on to consumers: that is, prices (of, for example, chocolate bars) may go up. Most people will likely say that it’s worth having your chocolate bar cost a few pennies more if it helps stamp out slavery. But the bigger point here: additional requirements imposed on companies do imply costs—something easy to forget. And there is little reason to hope that those costs will be borne by the people you think deserve to bear them. Also: we want to make sure that new requirements are pretty likely to be effective, otherwise we’re imposing costs (harms) for no reason.

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LINK: Nestle says slavery reporting requirements could cost customers (by Emily Baker for xThe Sydney Morning Heraldx)

Companies operating in Australia with an annual turnover of $100 million or more would be required to annually report on the risks of modern slavery within their business and the actions they’ve taken to address those risks under the federal government’s draft Modern Slavery Bill 2018.

Nestle, owner of more than 2000 brands in 189 countries, has told a senate committee that Australia’s proposed mandatory reporting requirements could add “cost and time” to businesses and suppliers “which will need to be borne somewhere”….

What do you think?


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One comment

  1. The usual excuses: this will cost customers more. The other usual excuse for doing something bad (e.g., in the case of Trump wanting to increase coal mining) is that it will create jobs. I looked at Nestle’s track record on slavery in a recent post: https://greenstarsproject.org/2018/09/11/ethical-consumerism-slavery-in-the-chocolate-industry/

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