Oxfam – Creating a Scorecard to Lead Humanitarian Change
People do not generally believe in something until that something starts changing the world. The road to stardom followed by the Performance Scorecard may have passed unnoticed to many, but we cannot overlook the instances in which the entire world reaps the benefits of its use.
Oxfam International, the ambassador of poverty battles worldwide, created the “Behind the Brands Company Scorecard” as a foundation to its campaign initiated to improve the world’s food supply chains.
The Scorecard selects the top 10 food and beverage companies in the World, based on criteria such as volume of sales, profits and market value, and awards them scores based on their sourcing of agricultural commodities from developing countries.
The structure of the Behind the Brands Company Scorecard consists of 7 themes and 4 categories of indicators for each theme. An interactive Excel spreadsheet groups all indicators, sub-indicators, categories and scores organized accordingly to theme and company.
The spreadsheet is based on publicly available data and it is open for consultation to anybody who wishes to do so. The methodology behind the Scorecard looks at assessing corporate level policies concerning key commodities such as palm oil, sugar cane, soy, cocoa, coffee, vegetables, rice and dairy products, by looking at the way their procurement impacts the lead components of the food and beverage supply chain.
Thus, the Scorecard weighs the environmental and social impact of the most prominent food and beverage supply chains by emphasizing their main themes for concern:
- Transparency
- Women farm workers
- Farm workers
- Small scale farmers
- Land sustainability
- Use of water resources
- Impact on climate
The four categories of indicators are each worth one quarter of the score attributed to each theme, and are based on each of the “Big Ten” Companies’ ability to demonstrate:
- Awareness, relating key social and environmental issues for every theme;
- Knowledge on measuring, assessing, and reporting on key issues that might compromise the integrity of each company’s supply chain;
- Commitment to confront and address key issues relating to every specific theme in the Scorecard;
- Supply chain management to deliver improvement by setting supplier standards that are relevant to each of the concerning themes.
Impact assessment for each of the underlining themes of the Scorecard is done by using key performance indicators such as: # Global reporting Initiative (GRI) Index, # Commodity volumes, # Sourcing countries, # Audit systems, # Men in the supply chain, % Women in the supply chain, % Farmer organizations, # Stable commitments, # Fair contracts, % Migrant workers, % use of child labor, $ Paying living wage, # Excessive working hours, % Greenhouse gas emissions, # Land rights of local communities, # Land disputes, $ Sustainable land investment, # Water use and % Water contamination.
Scores calculation for each of the organizations in the “Behind the Brands” Performance Scorecard is based on equal weighing of each of the seven themes within, equal weighing of each indicator within each category, as well as equal weighing of each sub-indicator, found under each main indicator.
The scores for each sub-indicator are summed up to calculate the score for each main indicator which is further summed up to calculate the score for each indicator category. The final calculation is summed up to deliver a thematic score of 0 to 10,”0” being the worst” while “10” is “the best”. A mean average of all indicators analyzed is used to determine the percentage score for each of the “Big Ten” companies.
This is aimed either at highlighting improvement efforts or at underlining the lack of action taken by any of the Big Ten companies in order to enhance their supply chains as well as advance their ranking in the Scorecard.
As people all around could now rate the socio-economic impact food and beverage companies have on the entire world, they started to demand change. Consequently, more than 700,000 actions were taken, soliciting the improvement of scores within the Performance Scorecard.
For now, Unilever has overtaken Nestle in the Scorecard ranking, by scoring best on workers’ rights, supporting small-scale farmers, as well as climate change. The company is highly active in ensuring worker’s rights are respected, deforestation is reduced, palm oil practices are improved, and farmers in the supply chain are treated fairly.
Having led the Scorecard for two consecutive years, Nestle falls into second place, with its strong policies on water, land sustainability and the support of women’s rights in the coca, coffee and dairy supply chains.
The most under-performing companies in the Scorecard are Danone, General Mills and Associated British Foods. These seem to score very low at assessing the impacts their policies have on communities worldwide. They are believed to lack transparency and take no, or little action in improving their supply chains on various issues.
The Behind the Brands Company Scorecard stands testimony to the indispensable value such tools can yield when serving the right purpose. Moreover, through precise measurement of the adequate indicators, the Scorecard becomes a vital tool within an ongoing campaign to reduce the negative impact dissolute policies bestow onto the environment and the marginalized millions at the bottom of large-scale supply chains.
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Tags: Balanced Scorecard, Food and Beverage performance, Nestle
