AnimalRighter
Promoting compassion and respect for animals
Columns
VegNews (November 2006)
Devil's Bargain
How Corporate Buyouts Impact the Ethics of Independent Companies
by Mat Thomas
The pattern is familiar enough: a small independent company starts out on a shoestring budget guided by laudable ideals and becomes a big hit in the burgeoning natural products market. They slowly gather a faithful
following by making a quality product that honors sustainable and humane principles. Then, once they get large enough to be noticed by the industry's mainstream players, they are bought out for a king's ransom and swallowed up by a soulless corporate juggernaut that seems to crush everything truly good and decent in its path.
It's no wonder that loyal customers feel betrayed when the feisty underdog who bucked the system willingly gets sucked into it for more money or greater "success." It's kind of like when your favorite obscure indie rock band signs on with a major label and suddenly becomes trendy. The more professionally produced sound that gets their songs played on Top 40 radio stations and MTV just makes their watered-down music mean that much less to those disappointed fans who once really believed in it.
An obvious case in point is the recent acquisition of Tom's of Maine by Colgate-Palmolive, which now owns 84% of the company. For more than 35 years, ethical consumers could rely on Tom's of Maine to provide natural toothpaste as well as 89 other personal care products made without artificial preservatives, sweeteners, dyes, animal ingredients or animal testing. Yet when people purchase Tom's of Maine products now, they are directly supporting a monolithic multi-billion dollar conglomerate that continues to test their own products on animals.
Tom and Kate Chappell, founders of Tom's of Maine, claim they made the deal with Colgate-Palmolive because they needed a powerful partner to meet growing demand for their products, which currently reach less than 3% of the natural foods market. Admittedly, we can expect to see Tom's of Maine on the shelves in far more stores now that they are a subsidiary of Colgate-Palmolive. Perhaps that's good news for the average consumer who will now have the option of purchasing natural toothpaste at their neighborhood supermarket, but those who take a moral stance against animal testing will have to find another brand of personal care products.
Colgate-Palmolive didn't pay $100 million to get majority control of Tom's of Maine because they believe in their holistic philosophy: if that were the case, they would stop using artificial ingredients in their own products and phase out animal testing as a matter of course. The reason Colgate-Palmolive incorporated Tom's of Maine is money: the bottom line is that they believe they can make a healthy profit from this deal. That's also why cosmetics colossus L'Oreal recently paid $1.56 billion for The Body Shop, and why Cadbury Schweppes acquired organic fair trade chocolate maker Green & Black's.
The real question is can the ethics upon which these companies were founded survive the corporate takeover process? That doesn't seem likely when the corporation's main objective is increasing market share at the expense of meaningful values.
Devil's Bargain
How Corporate Buyouts Impact the Ethics of Independent Companies
by Mat Thomas
The pattern is familiar enough: a small independent company starts out on a shoestring budget guided by laudable ideals and becomes a big hit in the burgeoning natural products market. They slowly gather a faithful
following by making a quality product that honors sustainable and humane principles. Then, once they get large enough to be noticed by the industry's mainstream players, they are bought out for a king's ransom and swallowed up by a soulless corporate juggernaut that seems to crush everything truly good and decent in its path. It's no wonder that loyal customers feel betrayed when the feisty underdog who bucked the system willingly gets sucked into it for more money or greater "success." It's kind of like when your favorite obscure indie rock band signs on with a major label and suddenly becomes trendy. The more professionally produced sound that gets their songs played on Top 40 radio stations and MTV just makes their watered-down music mean that much less to those disappointed fans who once really believed in it.
An obvious case in point is the recent acquisition of Tom's of Maine by Colgate-Palmolive, which now owns 84% of the company. For more than 35 years, ethical consumers could rely on Tom's of Maine to provide natural toothpaste as well as 89 other personal care products made without artificial preservatives, sweeteners, dyes, animal ingredients or animal testing. Yet when people purchase Tom's of Maine products now, they are directly supporting a monolithic multi-billion dollar conglomerate that continues to test their own products on animals.
Tom and Kate Chappell, founders of Tom's of Maine, claim they made the deal with Colgate-Palmolive because they needed a powerful partner to meet growing demand for their products, which currently reach less than 3% of the natural foods market. Admittedly, we can expect to see Tom's of Maine on the shelves in far more stores now that they are a subsidiary of Colgate-Palmolive. Perhaps that's good news for the average consumer who will now have the option of purchasing natural toothpaste at their neighborhood supermarket, but those who take a moral stance against animal testing will have to find another brand of personal care products.
Colgate-Palmolive didn't pay $100 million to get majority control of Tom's of Maine because they believe in their holistic philosophy: if that were the case, they would stop using artificial ingredients in their own products and phase out animal testing as a matter of course. The reason Colgate-Palmolive incorporated Tom's of Maine is money: the bottom line is that they believe they can make a healthy profit from this deal. That's also why cosmetics colossus L'Oreal recently paid $1.56 billion for The Body Shop, and why Cadbury Schweppes acquired organic fair trade chocolate maker Green & Black's.
The real question is can the ethics upon which these companies were founded survive the corporate takeover process? That doesn't seem likely when the corporation's main objective is increasing market share at the expense of meaningful values.
