Food Justice: Bringing the right kinds of businesses into the poorer communities

It is no surprise to read an article about the ever-increasing rate of obesity in the United States. Over the past several years, news articles and reports have discussed this issue at length, blaming parents, schools, fast-food restaurants and more. But there is so much more to this. First, I want to explain that it is not obesity that I’m attacking. It is simply the unhealthy eating and lifestyles that concern me. Overweight, underweight, whatever weight a person might be, they are susceptible to an alarmingly large range of diseases and disorders as a result of eating processed, packaged, and generally unnatural foods. This might not seem like an issue for the business students of the world, but it can be.

This article is about an organization called Earth Amplified and a business that they launched called S.O.S—System out of our System—Juice. This organization works in low-income neighborhoods to educate youth about healthy eating and food production. SoS Juice is a business that strives to bring affordable, healthy food to these neighborhoods. They employ people from these neighborhoods and give them a feeling of ownership over their food production and consumption. This is one of the most important things that business students need to understand on this subject—people in low-income neighborhoods will never be able to eat healthy without access to healthy food. The price of healthy food compared to unhealthy food is extremely off-balance. Businesses have a responsibility to charge the proper prices for their food. (With all of the environmental and health impacts associated with a cheeseburger, the proper cost of it should be far greater than a dollar.)

A large problem is the marketing campaigns for many of these restaurants. “The flaws of our global economy are best exposed by looking at our food system—soil-depleting and oil-depleting factory farming, economic policies that contribute to starvation abroad, and disease and obesity at home, all packaged with a marketing campaign to enforce the “buy first, ask never” social contract—just buy what they say to buy, and eat/shut up.”

Further, another article sums it up perfectly. “The fast food industry spends more on advertising in four days than the Robert Wood Johnson Foundation, the nation’s leading organization fighting childhood obesity, spends on health education in an entire year.”  This should not be the case. Business students and CEOs have the power to make a change for the better. Change marketing and change store locations so that consumers can make healthy choices.

Nero Pharmaceutical

Emperor Nero is was the insane one. He murdered his wife and daughter. Hence, I think it is simply inappropriate to compare recent CEOs or business students to Nero, unless they are completely insane. Emperor that “was fiddling while his city burned” was unable or simply did not want to perceive societies values (assuming Roman society of that time did value their very property and people, since Nero was denounced even in ancient roman texts). Business students and CEOs nowadays, however, cannot be said to not distinguish between right or wrong. The reasoning behind indifferent attitude “while the city is burning” is completely different and cannot be addressed in a manner similar to Nero issue. Indeed, CEOs, when acting in an unethical manner, are often driven by economical benefits; the same most likely applies to the business students. Non of them act in an inadequately harmful  way just upon their whim or for the sake of fun/evil. I personally think that Mr. Jones is over-complicating the issue and is addressing using a excessively harsh comparison. However, the image of Nero could effectively used as literary hyperbole to portray actions of contemporary businessmen, but not to explain them.

Good example of “fiddling while the city is burning” behavior may easily be found in the pharmaceutical industry. Honestly, the whole industry could be simply labeled as oligopoly, midway through to monopoly. “Isn’t it illegal in the land of opportunity and equal rights?!” – one would ask. It officially is, but there are ways around it, especially in pharmaceutical industry. One of the ways is to simply pay the smaller generic competitors to leave the industry, since purchasing the company right away is after all illegal. Big Pharma Companies indeed do so, due to the fact that they are so incredibly big, wealthy and powerful. Huge brand names are able to easily buy the exit ticket for generic small firms – it is just humorously easy for them to do.

Drug-making business has its very own distinctive and unique traits – they own our trust. As a matter of fact, we, customers, are victims as Pharma Firms, in collaboration with doctors that write prescriptions, have complete control over our health-related decision making. Thus, it is just so simple for Big Pharma Names to engage in fraudulent activities. In recent years there have been numerous frauds. Pharmaceutical companies quite often misrepresent their products in marketing campaigns, and what is left for us to simply trust them. Every fraud case was followed by fines imposed by U.S. Department of Justice in attempt to resolve allegations of fraudulent marketing practices. However, it just seems that the Pharma Firms just do not seem care about the charges. Indeed, the penalties are almost negligible considering the size of corporations involved.

While we are suffering from the diseases and “burning” in fever, pharmaceutical companies “fiddle”, at the same time counting profits.

How Big Pharma rips you off on drugs.
Recent 6 “Big Pharma” frauds.
Big Pharma’s Big Fines.

M&A: Murders & Executions

In reflection upon Clarence B. Jones’s speech at the Ross School of Business at the University of Michigan, I do agree that business school students and large businesses are sometimes blindly “fiddling while Rome burns.”  Broadly, it is vital to acknowledge that businesses constantly operate in competitive and shifting environments across the globe.  As such, business leaders must embark on new strategies to maintain an edge over the competition.  Last year marked a record number of deals in the merger and acquisitions (M&A) space.  In M&A, Company A either purchases or merges with Company B in an effort to exploit accretive financial advantages.  In other words, this type of business activity typically consolidates competitive entities in the hopes of driving greater sales, profits and shareholder wealth accumulation.  Think McDonalds and Chipotle, whom actually later divorced each other in 2006.

However, M&A can artificially and unproductively disrupt the organic growth of healthy companies.  In leveraged buyouts that occurred during the U.S.’s credit boom years of 2002-2006, over a dozen well-established companies were purchased by private equity firms and then bogged down with high levels of unsustainable debt.  The Tribune Company, publisher of The Los Angeles Times and The Chicago Tribune, was bought out for $12 billion by Sam Zell in 2007.  Today, the Tribune is on the cusp of breaching its debt covenants to its lenders and facing an ugly default.  According to 2008 article in the International Herald Tribune, some of the company’s bonds trade for as little as 9 cents on the dollar, and the “Tribune looks to be the megadeal most at risk.”  Thus, Jones’s speech gains true credibility as the world’s largest banks offer the best salaries to future investment bankers.  We need to look beyond the traditional cash flow and balance sheet metrics of buyouts and focus on the real people behind those very companies.

The Tipping Point of Overstocked Food Industry

Food waste is not only a discussion on the dinner table nowadays, but also a hot discussion topic on board meeting of most grocery stores, deli stores and bakeries. The unbelievable large amount of daily food wastes from the overstocked food drawn the attention from the public and forced the businesses owners to figure out nontraditional solutions towards the problem . Just like Clarence B.Jones addressed at the Ross Business School of Michigan, there are CEOs decided to be the Neros of today. Despite the critics from public, they stick along with the traditional way of waste handling, which is directly destroy all the food that are not sold by the sell-by date. This move is considered to be an enhancement to the firms’ brand images of quality control. However, with the growing understanding of sustainability among the public, people are more likely to consider firms putting efforts on re-use the “expired” food to be more responsible to the society and environment. Confused by mostly unregulated “sell-by” and “best-by” dates, consumers throw away the items out and contributed to more than 180 billion of food waste every year in United States. Public generally believe that the must be a more environment-friendly way to solve this problem and the ultimate goal becomes to create a win-win situation between food supplier and consumers.

Photograph by Evan Sung for Bloomberg Businessweek

Gladly, there are more and more firms and entrepreneurs starts to crack this problem through more sustainable ways. The whole foods market, as known as the US leading natural and organic food store chain, has been expending its Overstock Donation Program towards community around its retails. With help from the local hunger relief organizations and food banks, sufficient amount “expired” foods from the whole foods market are consumed before wasted. This is a good case of win-win between retails and their local communities. There are also people try to convert the wastes into profits. Earlier in 2013, Trader Joe’s, another leading food market chain in US, ex-president is reported to open a store to sell expired food. The price of pre-made meal provided by this store is comparable with most fast food store. The quality of food consumer could get from this is way better than fast food chains. Despite the critics about selling food might turn bad, the public are mostly delighted about this idea.

Different approaches towards overstocked food problem will come out in the later years, but the first and last point to overcome is still how to turn over the public’s traditional understanding of about-expire food, which I believe is the tipping point of the industry.

Who is to blame for the contradictions of the modern day auto industry?

In Clarence B. Jones’ speech at Michigan’s Ross School of Business, he stated, “History might well indict business students and CEOs as the Neros of today. We can’t know what is happening and continue to conduct business as usual. It doesn’t matter how innovative your company’s technology is. This is a problem that must be dealt with now or later, and fewer options will be available later.” This statement seems to be specifically referring to society’s lack of action regarding the well-being of mankind’s future. Although this is a significant issue to discuss, I do not necessarily believe that his accusation of business students and CEOs taking back row seats is true. While recent past events have shown that some businesses executives are, in fact, acting in support of their personal interests and not society’s, I do believe that there is a large majority of business people (and students) targeting weaknesses in today’s society and planning for change. One area that has evolved tremendously is the auto industry.

In the past 14 years, the auto industry has made numerous technological feats. Manufacturers have successfully integrated into an industry that does not only provide a means of transportation to consumers, but one that is driven by all sorts of desire-satiating technology. Some examples of automotive innovations include bluetooth integration, park-distance control, ultra-efficient engines, and 100% electric vehicles. These are major improvements that not only help companies survive through steady sales, but also concentrate on making the world a more sustainable place. People such as Elon Musk have taken great consideration of future (and present) global sustainability; therefore, to say that today’s business students and CEOs are the Nero’s of today is plain wrong. Instead of criticizing the choices that global business people make, maybe society should instead focus on the consumers themselves? And maybe it isn’t the manufacturing that is the issue, but instead, the idea of unsustainable consumerism? The wants and desires instead of the needs and requirements. Until we dive deeper into the problems associated with consumerism, there is no reason to point fingers at the general population of business students and CEOs.

Sustainability Can Save Rome

I think that this quote can be applied to a wide variety of issues in today’s society.  The issue that first comes to mind is the issue of sustainability and finding an environmentally friendly way to conduct business.  Our society has been moving towards finding more environmentally friendly solutions, but our society is still consuming natural resources at a rate that cannot be continued forever.  Businesses often emit harmful emissions during production, which is not helping the state of the environment.  I believe we will run out of natural resources much sooner than we anticipate, and the harmful emissions that businesses have been emitting for years will cause more damage than people realize.  If businesses are not actively trying to find more efficient/”green” ways to carry out production, they are just further perpetuating this problem.  If our society and businesses continue on this trend of inefficiently using resources and paying little regard to the environment, no one will know what to do when humans use up all of our natural resources or cause so many problems that some resources can no longer be used.  We need to address this problem sooner rather than later, and that is where businesses and business students come in.  More business schools are including sustainability in their curriculum to try and raise awareness about this problem, but the problem is no where close to being “solved.”

In an article written just over a month ago for the Sydney Morning Herald, there are reports of a possible natural gas shortage in New South Wales (a state in Australia) as soon as 2018.  The article says that this shortage will mainly effect businesses as opposed to people that use gas in their homes, but there will be implications on the general population if a business cannot get as much gas as it needs to carry on production.  This article only forecasts gas shortages for NSW, but it is easy to imagine that other places will face the same problems.  As businesses and households continue to consume finite resources at alarming rate, shortages are bound to occur.  Discovering new supplies of these resources is not a solution to the problem, but more of an extension because it will allow people to carry for longer before they must fully face the problem.  Businesses must be actively trying to find more efficient ways to consume resources, and business students can help them to do so.  These students may bring solutions to their companies that no one has considered before.  If CEOs and businesses do not make an effort to be environmentally conscious and sustainable, “Rome” will certainly burn.