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For Nestle, business in Zimbabwe is fraught with ethical peril
By Lauren | September 29, 2009
If you want to see a company in a real ethical Catch-22, look no further than Nestle. The company does business around the world and operates, among its many facilities, a milk powder and cereal factory in Harare that reportedly employs about 200 people. To operate the factory, Nestle needs to buy milk from local suppliers and there aren’t a lot to choose from. Consequently, Nestle has been buying milk in Zimbabwe from a farm owned by President Mugabe’s wife. Does that sound ethically questionable? Just wait - to quote the old song, you ain’t seen nothing yet.
The farm in question was seized as part of a government program to transfer land ownership in Zimbabwe from white commercial farmers to black Zimbabweans. According to news reports, the forced seizure of the white-owned commercial farms in Zimbabwe has all but destroyed the country’s agriculture-based economy and created widespread famine. It should be noted, however, that when the country was under all-white rule in the 19th and 20th centuries the best farmland was reserved for white settlers, leaving black farmers to struggle on unfertile land. Consequently, the land seizure program can be viewed as the unconscionable act of a corrupt government or as an honest effort to right a long-standing wrong. In all likelihood, it’s probably a little of both.
Both the European Union and the U.S. have targeted sanctions against Mugabe and his government because of concerns about violence and irregularities in the elections that put Mugabe in power. Nestle is based in Switzerland, however, so it’s not bound by those sanctions, and the Swiss government has cleared Nestle of any wrongdoing under its laws. But Nestle still has an ethical dilemma to address. Should it continue to do business with the wife of a government official who’s widely viewed as corrupt in order to provide job opportunities and a steady supply of its food products to a deeply impoverished nation? Or should it refuse to do business with the Mugabe family even if that means closing its Harare factory, laying off its workers, and making the famine in Zimbabwe even worse? For Nestle, the most ethical course of action is by no means clear.
Topics: Business Ethics, Social Ethics, business communications, corporate responsibility, ethics |
September 30th, 2009 at 12:38 am
I think that, as a rule, the innocent shouldn’t be made to suffer for an abstract ideal. Wars are fought for such causes, and civilians who had nothing to do with it are often the ones to pay. In this case, the subtle political games at play here likely mean next to nothing to the workers who would suffer if they were laid off, or the people of Zimbabwe who would lose that source of food.