Monsanto and Smallholder Farmers: a case study in csr

Abstract

This paper explores the case of the Monsanto Smallholder Programme (shp), an initiative implemented by the US-based transnational biotechnology, agri-chemicals and seeds company, Monsanto, between 1999 and 2002. The programme was intended to provide a package of agricultural extension support to ‘smallholders’ in selected developing countries. Based on empirical research in the USA and India, the paper examines why Monsanto came to undertake such an initiative, and how the company designed and implemented the programme. The paper traces the evolution of the shp over time and discusses the reasons why it was suddenly terminated in 2002. Drawing on insights from the literature on corporate social responsibility (csr), the paper argues that the shp represented an attempt to ‘mainstream’ the values and principles of sustainability into Monsanto's operations, but that this led to the distinctive philanthropic and developmental aspects of the programme being undermined by competing commercial and financial pressures.

Notes

The author gratefully acknowledges the financial support of the Economic and Social Research Council and the Development Research Centre on Citizenship, Participation and Accountability (www.drc-citizenship.org). The author also thanks his research assistant, Mr Kiran Sakkhari, who facilitated village-level field research and provided English – Telegu interpretation for interviews conducted with farmers; as well as two anonymous reviewers for their helpful comments on an earlier draft of this paper. A previous version of this paper was presented at the Development Studies Association annual conference, University of Reading, 11 November 2006. The article is based on a longer paper, D Glover, ‘Monsanto and smallholder farmers: a case-study on corporate accountability’, IDS Working Paper 277, 2007, Brighton: Institute of Development Studies.

1 M Blowfield, ‘csr and development: is business appropriating global justice?’, Development, 47 (3), 2004, pp 61 – 68; unrisd, ‘Corporate social responsibility and business regulation’, unrisd Research and Policy Brief, 1, 2004; P Newell, ‘From responsibility to citizenship? Corporate accountability for development’, ids Bulletin, 23 (2), 2002, pp 91 – 100; and P Newell & S Bellour, ‘Mapping accountability: origins, contexts and implications for development’, ids Working Paper, 168, 2002, Brighton: Institute of Development Studies.

2 unrisd, ‘Corporate social responsibility and business regulation’, p 1. See also J Bendell (ed), Terms for Endearment: Business, ngos and Sustainable Development, Sheffield: Greenleaf, 2000; and DF Murphy & J Bendell, ‘Towards civil regulation: ngos and the politics of corporate environmentalism’, in P Utting (ed), The Greening of Business in Developing Countries: Rhetoric, Reality and Prospects, London: Zed Books, 2002.

3 J Elkington, ‘The triple bottom line for twenty-first-century business’, in J Mitchell (ed), Companies in a World of Conflict, London: RIIA/Earthscan, 1998; S Zadek, The Civil Corporation: The New Economy of Corporate Citizenship, London: Earthscan, 2001; and CO Holliday et al, Walking the Talk: The Business Case for Sustainable Development, Sheffield: Greenleaf, 2002.

4 Newell, ‘From responsibility to citizenship?’; N Garvey & P Newell, ‘Corporate accountability to the poor? Assessing the effectiveness of community-based strategies’, ids Working Paper, 227, Brighton: Institute of Development Studies, 2004.

5 Blowfield, ‘csr and development’.

6 See, for example, Holliday et al, Walking the Talk.

7 Blowfield, ‘csr and development’, p 64.

8 Christian Aid, Behind the Mask: The Real Face of Corporate Social Responsibility, London: Christian Aid, 2004.

9 Blowfield, ‘csr and development’, p 62.

10 CK Prahalad, The Fortune at the Bottom of the Pyramid: Eradicating Poverty through Profits, Upper Saddle River, NJ: Wharton School Publishing, 2005.

11 A Cornwall & J Gaventa, ‘From users and choosers to makers and shapers: repositioning participation in social policy’, ids Working Paper, 127, Brighton: Institute of Development Studies, 2001.

12 A Davidson & M Ahmad, Privatization and the Crisis of Agricultural Extension: The Case of Pakistan, Aldershot: Ashgate, 2003.

13 See http://www.mahindra.com/mahindras/FARM_EQUIPMENt/mssl/mssl.htm#MSSL, accessed 19 May 2006.

14 M Scott, ‘Interview: Robert Shapiro, ceo of Monsanto, Co: Monsanto's brave new world’, Business Ethics Magazine, January/February 1996; R Lenzner & B Upbin, ‘Monsanto v Malthus’, Forbes, 10 March 1997; J Magretta, ‘Growth through sustainability: an interview with Monsanto's ceo, Robert B Shapiro’, Harvard Business Review, January – February 1997, pp 79 – 88; RB Shapiro, ‘Trade, feeding the world's people and sustainability: a cause for concern’, The ceo Series, 22, Center for the Study of American Business, Washington University in St Louis, MO, 1998; and RB Shapiro, ‘How genetic engineering will save our planet’, The Futurist, 33, 1999, pp 28 – 29.

15 Magretta, ‘Growth through sustainability’, p 86.

16 E Simanis & S Hart, The Monsanto Company: Quest for Sustainability, Washington, DC: World Resources Institute, Management Institute for Environment and Business, 2000, p A7.

17 Interview, Monsanto executive, St Louis, 20 June 2005. My source could not recall the exact terms of the developing country goal, including the number of countries targeted for agricultural ‘transformation’.

18 Simanis & Hart, ‘The Monsanto Company’; and D Charles, Lords of the Harvest: Biotech, Big Money, and the Future of Food, Cambridge, MA: Perseus, 2001.

19 Charles, Lords of the Harvest; and Simanis & Hart, ‘The Monsanto Company’. For an example, see Christian Aid, Selling Suicide: Farming, False Promises and Genetic Engineering in Developing Countries, London: Christian Aid, 1999.

20 Monsanto, ‘Monsanto Chief Executive outlines commitments on new agricultural technologies in the “New Monsanto Pledge”’, Press release, St Louis, MO, 27 November 2000.

21 Later versions of this pledge more explicitly underpin the company's ‘technology co-operation’ agreements—as opposed to the smallholder projects—through which it licensed its proprietary technologies for non-commercial exploitation in the developing world. Monsanto, Fulfilling our Pledge: 2000 – 2001 Report, St Louis, MO: Monsanto, 2001.

22 Monsanto, ‘Monsanto Chief Executive outlines commitments’.

23 Ibid.

24 Monsanto, ‘Growing partnerships for food and health: developing country initiatives in agricultural product and technology cooperation’, internal publication, St Louis, MO, undated, emphasis added. Although the document itself is undated, two inserts, tucked into a pocket in the flyleaf at the back of it, are dated January 2002. The packet was given to the author by a Monsanto executive in St Louis in May 2002.

25 Interview, former Monsanto executive, USA, 29 June 2005.

26 Monsanto, ‘Growing partnerships for food and health’, p 4.

27 From St Louis, of course, almost all Indian farmers would be considered very small.

28 Interview, Monsanto executive, St Louis, 23 June 2005.

29 Interview, Monsanto India executive, Mumbai, 11 January 2005.

30 Monsanto, Fulfilling Our Pledge; Monsanto, Commitments to our Stakeholders: 2001 – 2002 Monsanto Pledge Report, St Louis, MO: Monsanto, 2002; Monsanto, ‘Backgrounder: Monsanto Small Holder Program’, Briefing document, January 2002; Monsanto, Growing Options: Monsanto Company 2004 Pledge Report, St Louis, MO: Monsanto, 2004; Monsanto, Seeding Values: 2005 Pledge Report, St Louis, MO: Monsanto, 2005; and Monsanto, ‘Growing partnerships for food and health’.

31 Monsanto, Fulfilling our Pledge.

32 http://www.monsanto.com/monsanto/layout/our_pledge/socioeconomic, accessed 23 February 2006.

33 http://www.biotechknowledge.monsanto.com, accessed 6 September 2006.

34 http://www.monsanto.com/biotech-gmo/index.htm, accessed 6 September 2006.

35 Interview, former Monsanto executive, USA, 29 June 2005.

36 Interview, Monsanto India executive, 11 January 2005.

37 The Economist, 17 August 2002; A Barrett, ‘Rocky ground for Monsanto?’, Business Week, 12 June 2000; and Interview, Wall Street stock analyst, New York, 5 July 2005.

38 ‘Monsanto slashes Latin market profile outlook’, Chemical Market Reporter, 17 June 2002; ‘Monsanto warns of lower profit, scales back in Latin America’, Chemical Week, 19 June 2002; ‘Dry weather waters down Monsanto profits’, Guardian, 12 October 2002; ‘Monsanto cuts earnings target amid sales slump in Argentina’, Wall Street Journal, 14 October 2002; and ‘Monsanto 3Q loss widens to $165 million’, Chemical Market Reporter, 4 November 2002.

39 Monsanto, Monsanto Company 2002 Annual Report, St Louis, MO: Monsanto, 2002.

40 Interview, Monsanto executive, St Louis, 20 June 2005.

41 Interview, former Monsanto executive, USA, 29 June 2005.

42 Ibid.

43 One former Meekosam Project Officer described the Mech 162 hybrid as ‘the failure variety’. Interview, former Meekosam Project Officer, Guntur, 4 December 2005.

44 Interview, former Monsanto India employee, Hyderabad, 30 January 2005.

45 Interviews, Monsanto India executive, Hyderabad, November 2005.

46 Monsanto, ‘Growing partnerships for food and health’, p 10.

47 Interview, former Monsanto executive, USA, 29 June 2005.

48 Interview, former Monsanto India employee, Hyderabad, 30 January 2005.

49 Interview, farmer, Karlapudi village, Guntur District, Andhra Pradesh, 15 December 2005.

50 Interview, former teacher, Kumili village, Vizianagram District, Andhra Pradesh, 16 December 2005.

51 Interview, farmer, Kumili village, Vizianagram District, Andhra Pradesh, 16 December 2005.

52 Interview, farmer, Karlapudi village, Guntur District, Andhra Pradesh, 15 December 2005.

53 W Vorley, ‘Reconciling shareholders, stakeholders and managers: experiencing the Ciba-Geigy vision for sustainable development’, in K Jansen & S Vellema (eds), Agribusiness and Society: Corporate Responses to Environmentalism, Market Opportunities and Public Regulation, London: Zed Books, 2004, p 35.

54 Ibid, p 39.