What if the lion lays down with the lamb… and just tries to eat it?

In the recent merger between Ahold and Delhaize (owner of the Food Lion and Hannaford grocery chains), the jury is still out on whether Ahold’s commitment to the Fair Food Program will pull Delhaize up, or Delhaize’s outdated approach to social responsibility will drag Ahold down…

Sometimes when one company merges with another, good things follow.  Greater size and market power provide an increased ability to pursue the principles that underlie the two companies’ brands and, if those principles are harmonious, the potential for doing good while doing well increases proportionally.  But that is not the only possible outcome.  When a company with exemplary policies in supply chain management, for example, merges with another still mired in last century’s approach to corporate social responsibility, there is always the risk that the resulting enterprise becomes merely a watered down version of the better of the two companies, diluted by the law of the lowest common denominator. 

In 2015, there was great excitement when Ahold USA (parent of Stop & Shop, Giant and Peapod) joined the Fair Food Program.  Ahold USA had contacted the CIW in 2014, expressing its interest in joining the Program and a Fair Food Agreement followed shortly thereafter.  Celebrating Ahold USA’s strong commitment to the Program, James McCann, the company’s Chief Operation Officer declared:

Stop & Shop customer in Teaneck, NJ browsing produce in 2015 alongside a brand-new Fair Food Program point of sale display.

Ahold USA ’s companies are deeply committed to responsible  practices throughout their operations and to providing customers with great products at great prices from suppliers who share our dedication to strong ethical standards and fair treatment for workers…  The Fair Food Program is a time–tested leader in improving the lives of agricultural workers…  Our companies and our customers care about the welfare of workers in our supply chain, and we believe now is the right time to begin an important new chapter in our partnership with the CIW.

Given this strong statement of principles from Ahold, there was reason for even more excitement in 2016 when the company announced that it would be merging with Delhaize, a large Belgian supermarket company with holdings around the world.  Applying Ahold USA’s commitment “to responsible practices throughout their operations” and its “dedication to the … fair treatment of agricultural workers” to the market power of Delhaize’s major American brands, Food Lion and Hannaford, would certainly help improve the lives of ever more farmworkers.   Greater good from greater size.

Or so we hoped.   Unfortunately, Food Lion and Hannaford have yet to follow the example set by Stop & Shop and Giant.  A new company, Ahold Delhaize, has arisen from the merger, and so too has new leadership.  Much of that new leadership is from the Delhaize side of the marriage, and it is not clear that Ahold USA’s “dedication to the fair treatment of agricultural workers” is shared by the new company that has emerged.  Rather than creating a greater ability to further the principles of Ahold USA, the merger may be diluting them. 

But the merger process between two large companies is always lengthy and messy.  Establishing the new company’s values takes a bit of time.  Ahold Delhaize is still working to identify the company it will be going forward.  Ahold USA will continue to participate in the Fair Food Program, and with any luck Ahold’s example will lead Food Lion and Hannaford to do the right thing.  The lamb’s more civilized disposition may still prevail over the lion’s harsher nature.  Common sense, not to mention the future reputation of Ahold Delhaize, dictates as much.

Stay tuned…

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