A GM Code of Conduct
food and agribusiness
Until recently, genetically modified (GM) foods have been a success story. Global
land area planted with GM crops grew to 40% in 1999, totalling over 40 million
hectares. But increasing public concern has put issues surrounding GM foods back
in the spotlight, and the Rabobank Group has spoken out - becoming the fïrst
financial institution to publidy release a code of conduct on genetic modifkation.
Fighting malnutrition
Growing advantages
Healthy choices
Spreading the word
Public debate
i 2 What's NewS Issue 5 August/September 2000
Genetically modified crops and GM or-
ganisms can do a world of good to-
wards food security, raising nutritional
standards, and preserving the environ
ment. Yet social and ethical concerns
make GM food a hot issue. Says Hans
Smits, chairman of the Rabobank Group,
'owing to our position as a financier of the
agri sector in the Netherlands and our ac-
tivities as a leading international food and
agribusiness bank, we are increasing in-
volved
with
freedom of farmers to use seeds they have
grown themselves, the traditional farmer's
privilege.'
But consumers, especially in developing
countries, stand to benefit eventually. Ex-
citing breakthroughs promise big public
health benefit in the future with products
such as a recently engineered vitamin A
and iron-enriched rice, and soybeans mod
ified to produce healthier
foods and useful
indus-
trial
questions about
the safety of the GM technol-
ogy for nature and the environment and
the impact on the health of people and an-
imals.' It is therefore a matter of course
that Rabobank takes a clear stance on this
socially controversial issue, to be used as a
basis for considering financing activities
undertaken by the Group worldwide.
So far, food producers in the western
world have seen the benefits of GM crops
before consumers have. For example, ac-
cording to Science Magazine, 16 July
1999, when herbicide-resistant seeds are
used weeds are easily controlled and less
tillage is needed, minimizing soil erosion.
But farmers can also be victims. In the
case of such technology as the so-called
'terminator gene technology', GM crops
produce sterile seed, forcing farmers to
buy new seeds each year. According to the
Rabobank Group Code of Conduct it's
about protecting the rights and choices of
primary producers and consumers alike.
Says Smits, 'suppliers must respect the
chemicals. Oppo-
nents questioning the long-term safety of
such food, claim not enough scientific evi-
dence exists to analyze risks. In addition, a
decreasing lack of confidence in food regu-
latory bodies adds fuel to a growing
movement against GM products, Europe-
wide. Let the buyer beware, says the
Rabobank Group Code of Conduct which
seeks to protect consumers by endorsing
the clear labelling of food.
Uninformed consumers can't chose
smartly, yet labelling has been one of the
most controversial aspects in the GM food
fight. Most in the food industry have been
opposed to labelling out of fear that cus-
tomers will interpret that the products
aren't safe. There has been more pressure
for labelling in Europe, and less-so in the
US where most GM crops are planted.
However, in a recent turn-around, Novar-
tis made a statement of no-objection, cit-
ing labelling as a way to show confidence
in the safety and quality of their products.
The challenge for growers is to separate
the crops throughout production, leading
to higher costs in infrastructure and trans
port, but one that the Rabobank Group
feels must be guaranteed. In this way or-
ganic farming methods can also be
respected.
In order to give employees, customers and
society a clear picture of the Group's cor-
porare attitude on these issues and others,
the Rabobank Group Code of Conduct
along with an interview with Hans Smits,
was released on 25 August to Dutch and
international press, including the Financial
Times and Wall Street Journal as well as
F&A journals. And the feeling about GM
is one of cautious optimism.
'The Rabobank Group recognizes that ge
netic modification technology is a major
factor in helping to solve social problems
in the fields of food security and public
health, sustainable food production, and
renewable raw materials and energy
sources. It also respects the concerns
witbin society about the possible adverse
effects of this technology. The Rabo
bank Group will not finance or become
involved in the genetic modification and
cloning of people. In the case of animals it
applies the "no, unless" principle, and in
the case of plants and micro-organisms it
applies the "yes, provided" principle.'
In addition the code stresses that the
Group bases its decisions on existing laws
and regulations, is precautionary about
weighing potential benefits and risks of
projects, and bases its decisions on the
dominant ethical concerns in pluralistic,
democratie, western societies.
GM is becoming a part of our daily lives,
necessitating open communication and
public participation. As Smits says, our
code is only a guideline, a point of refer-
ence for credit assessment procedures.
Ethical boundaries are not static, but de-
velop over time, as do scientific insights,
giving rise to possible code revisions in the
future. By continuing the dialogue with
scientists, interest groups and politicians,
the Rabobank Group hopes to gain a bet
ter understanding of societal concerns and
test its activities against them. In doing so,
we remain a socially responsible partner in
the food and agriculture chain.
