Thursday, February 16, 2012

Whole Foods & Wholly Conscious Capitalism

by Francesca Rheannon
[This originally posted at CSRwire]
What does it take for a company to follow Conscious Capitalism?

As I discussed in my previous post "Does Conscious Capitalism Leave Retail Workers Behind?" the National Retail Association's Big Show held in New York City last week was thought provoking in more ways than one.

With Alan's comments fresh in my mind, I headed to Whole Foods' Co-CEO's panel on conscious capitalism: Where does consciousness fit in the cutthroat retail industry?

Now, Whole Foods presents an interesting case of the promise and pitfalls of the “conscious capitalism” Robb asserted is at the heart of the company’s mission and practices. While he was joined by The Container Store's CEO Kip Tindall and private equity firm Leonard Green and Partners' Managing Partner Jonathan Sokoloff, Robb's comments intrigued me in the background of the company's rollercoaster existence.

Whole Foods: From 'Best Corporate Citizen' to Consumer Boycotts

In 2001 Whole Foods was ranked as one of The "100 Best Corporate Citizens," by Business Ethics Magazine, but by 2008, Mindy Lubber was questioning the “whole” in Whole Foods in a post published on CSRwire, taking the company to task for not measuring its greenhouse gas emissions or setting targets to reduce them.

The chain was also the target of a customer boycott in 2009 over co-CEO John Mackey’s opposition to Obama’s health reform initiative. The boycott, both on Facebook and in stores, damaged the company’s brand perception.

Yet, Whole Foods has a better record on providing health benefits to its employees than many other big retail firms. It pays 100 percent of premiums for team members [employees] working at least 30 hours per week (an admirable 87 percent of the work force).

In contrast, 40 percent of the workers surveyed for the Discounted Jobs report have no health insurance and half have no paid sick days. Seventy percent of the workers do not get health insurance through their job (many make so little money, they qualify for Medicaid.)

And the National Retail Association is hefting major lobbying muscle to get the employer responsibility provisions taken out of the Affordable Care Act. It’s “Retail Means Jobs” campaign lists “repeal or delay of a health care employer mandate” among its top agenda items.

What Does Employee Happiness Involve? 

Robb spoke eloquently about Whole Foods’ “core values” at the NRA session, including “supporting team member happiness and excellence.” One could argue that a decent wage and good working conditions are at the heart of promoting workers’ happiness.

The company operates six stores just in Manhattan, yet non-supervisory team members only make between $10.28 and $10.50 per hour. At those wages, even with the employee discount, it would likely take a “whole paycheck” to buy a week’s worth of food at the store.

And employees charge in a series of articles on Gawker that the company “downloads responsibilities onto less-senior employees without compensation” (i.e., pays them at a lower wage rate than the work they are doing officially commands.)

Another worker says the quality of work life at Whole Foods has eroded, something he found when he went back to work there after a hiatus:

When I was hired the second time, they were in a "full-time hiring freeze" during which no one was being hired for full-time (and all new employees were scheduled at just enough hours not to qualify as full-time).

Other workers decry the company's wasteful practices, claiming that in many stores, the recycling bins are just for show. They said that everything is thrown into the trash at the end of the day – a stark opposite of the company’s core value, “Caring about our communities and our environment.”

At the same time, there’s no question that Whole Foods has done a lot of good to promote consumer awareness about sustainability and organic food.

But practicing “conscious capitalism” takes more than focusing on one worthy goal that also happens to fatten your bottom line. It takes a holistic approach that includes workers, as well as consumers, communities and the environment.

Let’s call it “Wholly Conscious Capitalism.”


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