Pilot Fair Food Program

Resolution Text

RESOLVED: Shareholders request the Board take the necessary steps to pilot participation in the Fair Food Program for the Company’s tomato purchases in the Southeast United States, in order to mitigate severe risks of forced labor and other human rights violations in Kroger’s produce supply chain.

Whereas:

Human rights abuses, including modern-day slavery, are widespread in agricultural supply chains, with severe risks in Mexico and the Southeast United States.  Recent law enforcement actions include an import ban on millions of pounds of Mexican tomatoes to distributors that supply Kroger and Albertsons,[1] 24 indictments in one forced labor conspiracy in the Southeast involving over 70,000 farmworkers,[2] and indictments and convictions in two others there.[3] 

Kroger has faced scrutiny from investors and customers regarding its supply chain and has been encouraged to join the Fair Food Program (FFP), a worker-driven social responsibility program recognized as the gold standard for preventing human rights abuses, especially forced labor.[4] It includes worker to worker education, rigorous monitoring, and ensures access to remedy through a 24/7 complaint mechanism.  Founded in 2011 in Florida by the Coalition of Immokalee Workers (CIW), it now operates on farms in nine states, including major tomato growers in five Southeast states. Its reach is expanding due to demand from supermarkets[5] and the U.S. government.[6]

Proponents are concerned that Kroger participates in programs and processes that may lack adequate oversight or be ineffective at addressing forced labor and other human rights abuses, exposing Kroger to legal and reputational risk. Kroger itself acknowledged the “success of the” FFP represents “best practices for respecting human rights.”[7]  But instead of participating in the FFP, Kroger uses social audits or self-assessments of suppliers, and purchases its Our Brands tomatoes from Mexican and Arizona farms certified by Fair Trade USA (FTUSA).[8] Kroger indicates FTUSA purchases “improve livelihoods,” but abuse on Mexican farms certified by FTUSA have recently been documented, including retaliation against workers complaining of unsafe conditions.[9]  Moreover, social audits have been declared “ineffective in identifying and reducing forced labor” in supply chains by the U.S. government[10] and experts,[11] who recommend the FFP instead.

Kroger remains an outlier—compared to peers like Walmart, Whole Foods, Giant, Stop & Shop, Fresh Market, and Trader Joe’s—in not joining the FFP.  In explaining its decision, Kroger misrepresented the Program as only operating in Florida, though the FFP has market density in tomatoes on farms throughout the Southeast.  Kroger also implied the FFP negotiates produce prices, but the Program is not involved in negotiations with suppliers and simply includes a price premium, similar to other certifications Kroger uses.  If Kroger is going to invest resources attempting to manage human rights risks through commitments to certification programs or audits, it should fully evaluate investment in a solution recognized to work, starting in the high-risk Southeast region with the most widely available FFP crop, tomatoes. 

[1] https://www.latimes.com/california/story/2021-12-31/u-s-blocks-tomato-shipments-from-mexican-farms-accused-of-abusing-workers

[2] https://www.justice.gov/usao-sdga/pr/human-smuggling-forced-labor-among-allegations-south-georgia-federal-indictment

[3] https://www.justice.gov/usao-sc/pr/multi-count-federal-indictment-returned-labor-trafficking-violations; https://www.justice.gov/opa/pr/three-defendants-sentenced-multi-state-racketeering-conspiracy-involving-forced-labor-mexican

[4] https://fairfoodprogram.org/recognition/

[5] https://ciw-online.org/blog/2020/08/largest-cut-flower-farm-on-us-east-coast-joins-the-fair-food-program/

[6] https://www.grants.gov/web/grants/view-opportunity.html?oppId=344432

[7] https://www.sec.gov/Archives/edgar/data/56873/000110465922054782/tm2212949-2_defc14a.htm

[8] https://www.thekrogerco.com/wp-content/uploads/2018/07/The-Kroger-Co._Social-Compliance-Program_2018-July.pdf ; https://www.thekrogerco.com/wp-content/uploads/2022/08/Kroger-Co-2022-ESG-Report.pdf  

[9] https://online.ucpress.edu/msem/article-abstract/38/3/379/194642/Fairwashing-and-Union-Busting-The-Privatization-of?redirectedFrom=fulltext

[10] https://www.cbp.gov/sites/default/files/assets/documents/2021-Aug/CBP%202021%20VTW%20FAQs%20%28Forced%20Labor%29.pdf

[11] https://www.theguardian.com/global-development/2020/jul/16/ethical-labels-not-fit-for-purpose-report-warns-consumers; https://www.business-humanrights.org/en/big-issues/labour-rights/beyond-social-auditing/