Wages and Working Conditions in South African Wine Production Discussed in Sweden

On Wednesday, 19 October 2016, Swedish television broadcasted a documentary about wine production, called “Bitter Grapes – Inside the Wine Industry”. The programme addresses the drawbacks of South African wine production, particularly whether the wages of wine production workers are sufficient to sustain them, and covers working and housing conditions, and the treatment of certain ethnic groups.
The document mentions the names of some wine producers. Alko’s sale-to-order collection includes three products from Robertson Winery, and Leeuwenkuil can be connected to some products sold in Alko. Robertson’s employees have been on strike during August - October. Their main demand is better wages.

Long-term cooperation with importers and Nordic alcohol monopolies

For years, Alko has been developing responsible purchasing with other Nordic alcohol monopolies. Alko requires all importers of alcoholic beverages to commit to the Business Social Compliance Initiative (BSCI) Code of Conduct. In addition to ensuring the ethical nature of their own business, importers must also guarantee that the entire supply chain is aware of the principles of human and workers' rights.

Auditing is part of responsible purchasing. A trained auditor checks that workers’ conditions in wine production facilities and vineyards comply with the agreed principles. Workers’ rights and human rights have mostly been in order in the audited production facilities and premises, but deficiencies have also been found. Deviations are most often found in wages, adherence to working hours and occupational safety.

To conclude the audit, each producer draws up a plan and schedule for the remediation of such deficiencies, naming the persons responsible for making the changes. Alko monitors the realisation of these plans together with the importer.

Investigation ongoing

Alko has contacted the importers of the products in its selection. The importers have investigated the matter and are taking steps to improve conditions in South Africa.

“In addition to taking action on our own, we have been actively in touch with Systembolaget, which has audited Robertson Winery several times in recent years. Systembolaget’s representatives have been on site in South Africa since early September, monitoring further audits and investigating the alleged problems,” says Laura Varpasuo, Sustainability Manager at Alko.

Wines mixed from several wines produced in different production facilities, or made from grapes cultivated in several vineyards, are particularly challenging to monitor. Leeuwenkuil, one of the producers mentioned in the documentary, can be connected to some products sold in Alko. Alko has investigated the supply chains of these products via the importers. Systembolaget is auditing Leeuwenkuil and vineyards that deliver grapes to it.

This year, Alko has had a BSCI audit performed on three South African wine producers and nine vineyards that supply them with grapes.

Alko offers customers a selection of products whose sustainability is guaranteed by an ethical trade certificate, such as Fair for Life, For Life or Fair Trade. Alko currently sells 31 South African labels that have been certified as ethical.

The #nofilter campaign and the supply chain

In early 2016, Alko sought ideas for its responsibility communications by partnering in the junior series of the AdProfit competition, organised by the Association of Finnish Advertisers. The winners of the competition were Janna Timonen and Ada-Maria Wäckin with their idea #nofilter, that aims to increase the transparency of corporate social responsibility. Alko will launch a campaign based on this idea in late October.

“We think that it is important to communicate openly about the challenges in our supply chains. We want to pay attention to these issues and, together with importers, develop the production conditions of alcoholic beverages throughout the world. We will launch the #nofilter campaign in late October to raise public awareness of for example typical shortcomings in workers’ conditions”, Varpasuo explains.

Further information on Alko’s responsible procurement is available via these links: http://www.alko.fi/en/vastuullisuus/vastuullinen-hankinta/responsible-procurement-the-nordic-way/ http://www.alko.fi/en/alko-inc/for-suppliers/responsible-purchasing/ http://www.alko.fi/vastuullisuus/vastuullinen-hankinta/auditoinnit-2016/

For further information, please contact:
Maritta Iso-Aho, Executive Vice President, Communications, maritta.iso-aho@alko.fi tel. +358 (0)20 711 5443
Elina Tompuri, Communications Specialist, elina.tompuri@alko.fi, tel. +358 (0)20 711 5608