Grocers under fire for covid dividend bonanza

Supermarket chains have found themselves in the firing line for hiking shareholder returns during the coronavirus pandemic.

A new report from Oxfam found that major supermarkets from the UK, Netherlands and US increased their dividend payouts to shareholders by an average of 123% – from $10bn to over $22bn – during the first eight months of the pandemic.

Most UK supermarket chains increased the pay of shop floor and logistics workers during the pandemic in recognition of their hard work, while some such as Sainsbury’s also made lump sum bonus payments to frontline workers.

However, the report claimed the costs related to covid-19 reported by supermarkets “paled in comparison” to the additional revenues gained and increased shareholder payouts. Across UK supermarkets, Tesco, Sainsbury’s and Morrisons, all increased their dividend payments.

The report also suggested there was little evidence to show that supermarkets were investing in long-term supply chain improvements to help food producers and workers experiencing extreme hardship due to the pandemic, with women hit the hardest.

It urged supermarkets to shift corporate practices on maximising shareholder payouts and redirect spending towards long-term supply chain investment that ensures fair and decent working conditions for workers, farmers and women in their supply chains.

“Workers in the supermarkets’ global supply chains continue to be faced with poverty, exploitation and discrimination,” said Rachel Wilshaw, Oxfam's workers' rights senior manager. “There needs to be a fundamental shift in the way supermarkets truly tackle human rights, gender inequality and unfair distribution of income for workers and small-scale farmers in their global supply chains.”

Responding to claims that supermarkets had put the interests of shareholders over those of workers, Neil McMillan, senior counsellor at EuroCommerce, a trade body representing supermarkets, told Politico: "Our sector has invested significant amounts during the crisis to keep staff and customers safe — and to keep supply chains open and our customers access to reliable supplies of food and daily essentials. It has also recognised and rewarded its staff for the massive effort they have made over 15 months to keep customers provided with the essentials they need."

No Comments Yet.

Leave a comment

Footprint News

Subscribe to Footprint News