Target Executives Grilled over Company's Costly "Sustainability" Programs
Shareholder Requests an Annual Accounting of Green Programs as They May Harm Customers, Suppliers and Shareholders
Company Executives Refuse Call for Transparency: Will Continue to Hide Costs of Sustainability Campaigns from Customers and Shareholders
Chicago, IL / Washington, D.C. - Today, at Target's annual shareholder meeting in Chicago, Justin Danhof of the National Center for Public Policy Research asked Target CEO Gregg Steinhafel to explain the business rationale for Target's so-called sustainability push.
Danhof also asked Steinhafel to issue a separate financial cost/benefit analysis covering the company's sustainability campaign so that Target shareholders can see exactly how much it is costing their company annually.
Steinhafel deferred to Timothy Baer, Target's Executive Vice President and General Counsel, to answer Danhof's question. Baer made it clear that transparency will not be forthcoming.
"Target executives went all-in in their push for sustainability at all of its retail stores and for all of its products. Worse than that, company executives refused to come clean with customers or shareholders and reveal the full cost of these green programs," said Danhof, who is the National Center's General Counsel.
Target is a member of the Retail Industry Leaders Association (RILA), one of the country's largest trade organizations. RILA is currently pressuring its membership to adopt sustainability measures in all aspects of their retail businesses. And Target appears more than willing to comply.
"Target's website is filled with sustainability stories and company goals for the future. What the website appears to be lacking is any cost/benefit analysis to explain whether customers are being charged a premium at the checkout counter or whether company shareholders are funding a failing endeavor," said Danhof.
In his initial response to Danhof, Mr. Baer told Danhof to go to Target's website, where the company details its sustainability campaigns and goals. When Danhof pressed Baer as to whether that website would show shareholders how much these programs cost, or show consumers the mark-up they have to pay so Target can push these European-style green programs, the Target executive simply said, "no."
Danhof expressed concern that Target's sustainability initiatives would harm not only customers and shareholders, but also small suppliers. Under pressure from large retailers such as Target, suppliers are likely to see manufacturing costs increase as they pay more for compliance, materials and staffing to comply with sustainability mandates.
"Transparency is a foreign word to Target executives," said Danhof. "It is clear that however much money Target is spending on these ill-defined sustainability campaigns, they don't want shareholders or customers to know. Corporate adherence to a green ideology is not sound business, and it should never trump accountability to the company's true owners - the shareholders."
An audio recording of the Danhof-Baer exchange can be found here on YouTube.
A copy of Justin Danhof's question, as prepared for delivery, can be found here.
Danhof attended the meeting as proxy for Benjamin Daniel Blatt, a Target shareholder. The National Center for Public Policy Research is also a Target shareholder.
The National Center for Public Policy Research is a conservative, free-market, non-profit think-tank established in 1982. It is supported by the voluntary gifts of over 100,000 individual recent supporters. In 2011, it received over 350,000 individual donations. Two percent of its revenue comes from corporate sources. Contributions to it are tax-deductible and greatly appreciated.