Thursday, November 16, 2006

The Body Shop

I had another email about the Nestlé/L'Oreal takeover of Body Shop today, this time asking for our position on it. The quick response was to send the links to the statements on our website, but I realise I haven't written much of the behind the scenes side of this saga yet. So here goes.

It all began for me when I heard on the morning radio news back in March that L'Oreal was making a bid for Body Shop. No mention of Nestlé, but as carriers of our handy pocket size boycott cards will now, Nestlé is part owner of L'Oreal.

It seemed a disaster in the making as Body Shop has espoused 'ethical values' including consumer power and boycotts as a way to exert pressure on dodgy companies. Now here was Dame Anita Roddick, founder of Body Shop and still a major shareholder in it, approving selling out to the world's 'least responsible company'. There she was in The Guardian saying: "this is without doubt the best 30th anniversary gift the Body Shop could have received".

It is at moments like this that all work plans go out the window to deal with a story in the heat of media interest. The first objective was to ensure that future news reports mentioned that Nestlé owned over a quarter of L'Oreal and that if the sale went ahead buying Body Shop would put money in Nestlé’s pockets. And in making that link, we wanted to gain further exposure of Nestlé's aggressive marketing of baby foods and the boycott campaign. Our press release went out later that day.

We asked supporters to send messages to Body Shop and Dame Anita via their websites raising their concerns about a link to Nestlé.

The media soon picked up on the absurdity of 'ethical' Body Shop falling into the hands of unethical Nestlé. Others were raising concerns about L'Oreal's record of testing on animals and obstruction over regulations aimed at ending the practice, regulations Body Shop had championed.

So almost immediately news of the Body Shop takeover became a story of unscrupulous businesses getting their hands on an ethical pioneer and the dilemma it would create for consumers. The front-page story of The Independent on 18 March was : "Anita’s £625 million sell out" with plenty on Nestlé's record on baby food marketing and the boycott.

This obviously rankled Dame Anita. She wrote on her blog after seeing more of the same in the Sunday papers: "I woke up on Sunday morning, bright and early, to discover that – apparently, and at some time during the night – I had 'betrayed women'. This is something that has happened to me only rarely in my life, thank goodness: reaching over for the Sunday papers and my reading glasses, only to find the headline 'Oh, Anita, it's not worth it!'"

But though while Dame Anita attempted to defend the decision of selling to L'Oreal, claiming Body Shop values were 'ring-fenced' and would change L'Oreal rather than the other way around, she was silent on Nestlé and the fact it would profit from Body Shop customers.

In a bid to raise these issues with Dame Anita, who was proving difficult to contact, I posted a message on her blog:

Nestle, the world's 'least responsible company', owns 26.4% of L'Oreal. Baby Milk Action promotes a boycott of Nestle over its aggressive marketing of baby foods. Nestle is responsible for more violations of World Health Assembly marketing requirements than any other company. The boycott targets Nescafe, Nestle's flagship product, but we list all products from which Nestle profits. Body Shop will be listed once the takeover has gone through. Many people have contacted us voicing their shock and disappointment that buying Body Shock products will in future put money in Nestle's pockets.

Find out more at

We too are saddened, particularly given the support of Dame Anita and the Body Shop for consumer action in the past. The Body Shop website still states: "Whether it's signing a petition, using our purchase power to boycott a company, or lobbying governments, we all have the power to effect change."

You can sign a Nestle boycott petition on our website and find out how the campaign helps to hold some of the world's most powerful transnationals to account.

We welcome your views, which can be submitted via our site.

Mike Brady
Campaigns and Networking Coordinator
Baby Milk Action

The boycott focuses on Nestlé's Nescafé coffee in the UK and most other countries (in Italy it is Nesquik as self-respecting Italian's – connoisseurs of real coffee - would not drink Nescafé). This is for the tactical reason. Nescafé is Nestlé's biggest brand and flagship product. It is widespread, so presents lots of opportunities to raise the boycott. There are many other options on the market – many of them better and/or cheaper. And having a main focus on one product gets around the opt-out excuse of : "You can't boycott Nestlé, they make too much".

Well, you can as many boycotters will testify. For those who want to avoid the lot, we list the main products from which Nestlé profits, including where the link is not immediately obvious. This has had sometimes dramatic effects. So the wholefood sector keenly supported the boycott of Tartex vegetable patés because of the Nestlé link. When Nestlé sold the business, they continued to boycott those products made at Nestlé’s factory, which we listed. When these were moved away like the other products so not a penny went to Nestlé, Tartex was moved off the list and into the wholefood shops.

Nestlé was set to own 26.4% of Body Shop via its holding in L'Oreal – Nestlé's Chief Executive is on the board. So it would go on the list, with an asterix indicating it was partial ownership. But, we wondered, what would boycott supporters do, faced with divided loyalties between attraction to Body Shop values and revulsion of Nestlé's?

We thought we'd ask so set up an on-line questionnaire and emailed our lists of supporters. The results came back quickly and where striking.

Literally 99% of 500 respondents said they would add Body Shop to their personal boycott lists. And people left comments explaining their outrage at what Dame Anita had done in selling to Nestlé/L'Oreal. It was not just a bad move, it was a betrayal they said. You can read the comments at

The hot topic of conversation was what where the alternatives. Baby Milk Action doesn't recommend other brands because we don't want to be compromised by associating ourselves in any way with a competing company. But Ethical Consumer had a ranking of cosmetic firms. Body Shop was set to tumble in the 'ethiscore' rankings from a good 11 out of 20 to an abysmal 2.5 out of 20. But there were many alternatives, scoring even higher than the old Body Shop. See

Which I found to be an interesting phenomena. The main beneficiaries of the furore would be ethical businesses.

Inside Body Shop meanwhile rumour has it there was chaos as people went into shops tearing up their loyalty cards, 'At Home' agents resigned and an apparently large number of shop managers began looking for new jobs. Once the takeover went through I am led to believe salaries had to be hiked up to keep managers in the shops.

Throughout this all Dame Anita was silent on the Nestlé link. Though she said in her blog on 23 March: "I realise I need to reply to the comments that have been emailed to me regarding Nestle, which I will do, but as I’m just about to go to the Far East for a few weeks on business, I’ll craft my response upon my return."

The weeks passed and no crafted response came. Then in May after I left a comment on the blog explaining our forthcoming annual demonstration against Nestlé would include leafleting at Body Shop outlets, I received a letter. I phoned and sent emails saying we would take this to be the public response unless Dame Anita wished to provide something else. We were told she had nothing to add.

So we released the letter. See

It was strong stuff and in many respects a great contribution to the campaign as it acknowledged Nestlé's record. It included the memorable phrase: "So if you have to bloody boycott - then boycott."

Though only those companies Nestlé owns 100%, Dame Anita suggested. Not those it owned 28.8% of (Nestlé's latest year report revealed an increase in shareholding).

This resulted in another round of media coverage. I mentioned previously picking up the Evening Standard on a train and finding a full page article about it, with a picture of our boycott leaflet downloaded from the website. This is the report from The Independent

The letter contained a surprising shift from Body Shop values - the website was still proclaiming the power of consumers and the role of boycott. But Dame Anita wrote: "...boycotts rarely work and the people you hurt are primarily the weak and the frail. And when all you do is boycott then there is no chance of getting a lever on the way the world is."

Dame Anita also commented that as a company listed on the stock market it was already owned by: "amoral city financiers, asset strippers and fund managers in the city of London, who eat communities for breakfast." It has been suggested there was no choice in the sale as L'Oreal could have taken it over anyway - indeed it seemed it was buying up all the shares it could while negotiation was going on. Perhaps, though there had been an earlier takeover bid that would have seen the Body Shop return to private ownershop, so it would have been owned by neither L'Oreal or 'amoral city financiers'. If it was to be bought out, there were choices about how to present this publicly, how to refer to - or ignore - the Nestlé link.

There are a few more twists and turns in this story which I will save for another day.

So what was achieved by dropping other work to respond to the takeover story that day back in March? Well, many more people know about Nestlé part-owning L'Oreal and now Body Shop. They know about the boycott and Nestlé's aggressive marketing of baby foods. It is publicity we could not buy. That few organisations could buy, because aside from the media it travels by word of mouth. The Body Shop is another place to raise Nestlé malpractice – that is part of the logic of a boycott campaign.

And in the build up to Christmas you may like to download leaflets from our website or request copies from us to hand out as people mill around a Body Shop near you. The leaflet targets Nestlé and acknowledges some will have a dilemma over whether to add the Body Shop to their personal boycott. If they do not wish to they can at least boycott Nescafé and support the campaign in other ways. But they have a right to know where their money will end up.

There was also an indication that Body Shop's brand image had been tainted by its association with Nestlé. A critically important point for investors, because if Nestlé drags the value of a brand down they are worried. A YouGov opinion poll found:

"The Body Shop's "buzz" rating has dropped 10 points to –4 since the beginning of the month, the public's "general impression" of it is down three to 19 and "satisfaction" has slumped a massive 11 points to 14."

Why? Because of L’Oreal's reputation and because: "L'Oreal is 26.4% owned by Nestle, one of the most boycotted companies in the world."

L'Oreal is now planning massive investment in Body Shop and to expand it further. Maybe its image will recover if enough is spent on advertising and promotion. If L'Oreal does respect its 'ring-fenced' values and is converted by them. But maybe the Nestlé taint will be too strong, particularly if we continue to remind people where their money ends up.

One thing is for sure. There has been a cost to Nestlé/L'Oreal, a financial and a public relations cost, because the company continues to market its baby foods in breach of international standards.

Nestlé executives put profits before infant health. Making the unnecessary death and suffering appear on a company balance sheet through the boycott makes them, investors and shareholders take notice.

(And if you are now asking 'to what affect' read the blog 'The long haul').

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