Church puts investment muscle behind supermarket attack

The Church of England is using its weight as an investor to pressure the UK government to examine the effect on UK farmers of low produce prices paid by supermarkets.
A report produced for the Church’s Ethical Investment Advisory Group by the SRI unit at CCLA Investment Management, which manages more than £5bn in funds for UK churches and charities, reported concerns that retailers were extracting “below cost” supply agreements from farmers, in part to push special promotions such as 2 for 1 offers. It called for a government debate on the issues with the aim of promoting a sustainable agricultural sector. The report called Fairtrade begins at home: Supermarkets and the effect on British farming livelihoods, is an important step for investors in pushing government policy as part of their responsible investment commitments.
The church told the UK Competition Commission that the pursuit of cheap food coupled with the buying power of the big supermarkets was putting farming livelihoods at risk.
It said farmers were being made to pay for supermarkets’ own promotions, saying this was one of a “number of invisible and pernicious practices squeezing farm-gate prices.”Other questionable supermarket practices, it said, included labeling products as British, which were often only processed or packaged in the UK. It said farmers were also subject to changing payment terms that increased their risk of financial loss.
Rt Rev Michael Langrish, Bishop of Exeter, who chairs the Church’s Rural Strategy Group, said: “The business practices of the major food retailers have placed considerable stress on the farming community through the use of methods which we believe to be unfair and of which consumers seem to be unaware. Farmers seem to be unwilling to complain or to expose these practices for fear that their produce may be boycotted by the major retailers. It is clear that the Supermarkets Code of Practice is not working.”
The church said it had a duty as a major investor in the retail food industry and a landlord to many tenant farmers, to consider the relationship between the two areas of business.
The CCLA report was carried out during the first half of 2007 and included one-to-one and group meetings with farmers around England.
Click here to read the Church of England report