Why we shouldn’t be surprised by Tesco | Stephen Devlin

Today the Groceries Code Adjudicator (which is jargon for one woman, Christine Tacon, whose job it is to monitor the misbehaviour of supermarkets) revealed a terrible array of exploitative practices that Tesco uses when dealing with the smaller suppliers that provide the food to stock its shelves. Essentially, Tesco has abused its economic position to take advantage of less powerful companies by unduly withholding and delaying payments, sometimes a large as £2 million.

Christine Tacon sums up her feelings with this line: “I was troubled to see Tesco at times prioritising its own finances over treating suppliers fairly.”

But it shouldn’t be surprising that Tesco prioritises its own financial interest over some concept of justice – that’s the inherent nature of modern corporations. It’s not Tesco’s job to ensure that our economy functions according to our principles of equality and justice. For that we need strong and effective regulation and a government that is willing to stand up to corporate short-termism in the interest of public long-termism.

As we already knew, and this report has made yet clearer, the basic driver of everything Tesco does is profits. Indeed, corporations have an effective legal duty to maximise the returns to their shareholders within the limits of the law. The problem, then, is what is within the limits of the law.

Supermarkets set their own standards for waste and resource use. They face few limits on how or where they can expand their stores. And now this report tells us they feel free to break standards of conduct in relation to their suppliers.

The problem here is not that Tesco is a bad apple, but that our food system and regulatory system in general are set up so that those who are powerful, economically or politically, run the show.

NEF’s research has explored the severe inequalities and injustices in the food system, and looked at alternatives. We’ve also exposed the way government and corporations are increasingly dismantling the regulatory system that should protect the vulnerable, from small food suppliers to badly-treated workers, from exploitation.

It’s great to see corporate malpractice being publicly challenged, but the limited power of the Groceries Code Adjudicator to do much about it (Tesco won’t even be fined) and the narrow debate that will undoubtedly follow this revelation are not enough to change the system for the better. The government must face up to the consequences of its deregulatory agenda.

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