Cadbury capitalism

December 4, 2016 2 Comments
The Cadbury factory in Bournville near Birmingham.

The Cadbury factory in Bournville near Birmingham.

All my life I’ve been a chocolate addict.  The high point of a visit to my granny’s at Howden was when she would open a secret drawer and give me some.  At home my mother used to hide bars in a high cupboard, well away from a small boy’s fingers.  I repeated the trick when our girls were small, and for no good reason, long after they’ve gone, the chocolate still gets stored in a high cupboard, even though I’m its only regular consumer.

In the 1950s and 1960s all the original British Quaker chocolate names still survived: Fry, Rowntree, Terry and Cadbury.  The cocoa industry wasn’t all benevolence and enlightenment, especially for the African growers and suppliers, but the Quaker owners always felt a moral responsibility to take some care of their own workers.  Anyone who’s been to Bournville can’t fail to admire the quality of the workers’ houses the Cadburys built around their factory.

fryNot a shred of that paternalistic tradition now survives.  For decades the UK’s brand of capitalism, with its prejudice in favour of short-term shareholder profit, has placed a premium on takeovers and mergers, and pays no heed to who owns companies, whether home-grown or foreign, benign or predatory.  The attraction of easy profit long ago lured the descendants of the chocolate Quakers into selling their interests to bigger firms.  Fry, the inventor of the chocolate bar in 1847, sold to Cadbury in 1919, Rowntree sold to Nestlé in 1988, Terry succumbed to Kraft Foods in 1998.  The largest of them, Cadbury, already merged with Schweppes in 1969, finally sold out to the US food giant Kraft in 2010 for £11.5bn.  Since then Kraft has mutated into a company calling itself Mondelēz International.

Kraft’s hostile takeover didn’t go unchallenged, by the trade unions, who feared for the future of Cadbury jobs in the UK, and by the Prime Minister at the time, Gordon Brown, who was anxious about the results of US control.  Both fears were justified.  The results of the Kraft takeover were disastrous, for chocolate workers and chocolate consumers alike – just as Kraft’s earlier takeover of Terry had been calamitous, with the York factory being closed within five years. 

bournvilleAs soon as the sale was through Kraft reneged on a promise to keep open the Cadbury plant in Somerdale, Bristol and closed it, with the loss of over 400 jobs, moving production to Poland (later the same year they sold the Polish factory).  The chief executive of the company, Irene Rosenfeld, was summoned to the Business, Innovation and Skills Committee of the House of Commons to explain the action, but she refused to appear, saying it was ‘not the best use of her personal time’.  In December 2010 Kraft announced they were going to move part of their business to Zurich, to avoid paying tax in the UK (the Birmingham Post estimated that £200m of corporation tax would disappear).

green-and-blacksThe bad news keeps on coming.  Green & Black’s, a fine specialist chocolate company, sold out to Cadbury in 2005 (and withdrew their best line, cherry), and the new owners have now announced that G&B products will no longer be organic, as they have always been.  Mondelēz have also said that Cadbury will leave Fairtrade, which they had used since 2009 and had earlier promised to support, and instead will use its own ‘sustainability’ programme: hardly good news for cocoa suppliers. 

A former senior Cadbury worker recently said this about the company a few days ago: ‘As an insider for 15 months, I witnessed the good that Cadbury did for its customers, its employees and the wider community. I felt proud to tell my friends that I worked for the brand. I was very sad the day I walked out of my office in Uxbridge for the last time – but to see what has been done to the company since I left is simply heartbreaking.’

irene-rosenfeldWhat’s happened to Cadbury isn’t unusual.  A long-established UK firm with a proud history of caring for its workers and its local community is sold to a multinational conglomerate based overseas.  Capacity and jobs are rapidly stripped out, with a complete disregard for promises made earlier, and redistributed around the world, wherever they will give the greatest yield for the least cost.  Democratic public interest is treated with contempt, trade unions are ignored.  Workers’ pay is held down as low as possible, while directors’ pay knows no limit: in 2014 Irene Rosenfeld’s pay and benefits rose by half to £16.5m.  The company treats consumers like fools, as the recent creme egg and Toblerone fiascos have shown.

There’s been much talk of globalised turbo-capitalism as a potent factor in turning people against ‘the establishment’ and towards populist politicians in referenda and elections.  Chocolate, I have to admit, probably plays a smaller part in most people’s lives than it does in mine.  But the story of Cadbury is a telling and powerful example of why many people feel so lost, alienated and angry with a world that seems out of control.

I shall be adding Cadbury to the lengthening list of companies I boycott on account of their unacceptable behaviour.  And Green & Black’s can look for other buyers – I’m sticking with the Co-op’s Fairtrade brand from now on to feed my personal addiction.

Comments (2)

Trackback URL | Comments RSS Feed

  1. Alun Burge says:

    This is a very fine post which deserves to be circulated far and wide. It analyses and exposes the impact of global capitalism on one niche part of the consumer market. The rise of fair trade showed what can be achieved when consumers apply ethical principles to markets. Please share Andrew’s blog.

  2. Thanks for raising this, Andrew. On the plus side there are new small companies forming all the time, and we can switch our loyalties to them. Personal favourites I’d recommend are:

    Hipo Hyfryd
    Welsh, tasty, better value than Booja Booja, minimal packaging, no deceptive box sizes.

    Seed & Bean
    Organic and fair trade, fully compostable foil packaging.

    Guilt-free treats.

Leave a Reply