Chiquita Banana Case Study

Managing Environmental Issues

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Chiquita Banana

Golden Gate University
536 Mission St
San Francisco, CA 94105
www.ggu.edu

MGT 345 The Contextual Environment of Business

Professor John Hawes
Spring 2016

Muriel Perez
Student ID 0578095
perezf.muriel@gmail.com

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Better bananas: Chiquita settles lawsuit over green marketing,

but the legal battle isn't over

Chiquita banana is a company that grows and commercialize banana in Latin America since 1989. Bananas are in the world the number one fruit to export and the fourth most important food crop after rice, wheat, and maize. The production of bananas is very big in quantity, therefore the impact of the production them is also big. According to the advertising that Chiquita does, the company seems like being very aware about being social responsible with the environment. Chiquita includes within its core values for the company one that is ‘Responsible’, in reference to that they act very responsible with the communities and the environments they affect with their operations. Chiquita initiated its corporate social responsibility  (CSR) program 20 years ago when CSR was not as a must for companies (like it is today). Chiquita’s website also states that the company uses low levels of agrochemicals and also that the company protect the local communities. As a consequence it seems that Chiquita has been caring about the impact on the environment and has created and implemented many plans for that.

Seattle nonprofit organization, Water and Sanitation Health (Wash), has filed a lawsuit against the Chiquita Banana. The Seattle organization stated that Chiquita Banana, that are supposed to be certified as sustainable company by the Rainforest Alliance, is actually pulling or contaminating water supplies in Guatemala. The Seattle organization said that Chiquita is using misleading marketing to advertise sustainability practices. As a consequence of those actions, the Seattle group has started an additional lawsuit against Rainforest Alliance because this last company is also responsible for certified Chiquita farms as sustainable. It seems that Rainforest is given certifications to companies or businesses without meeting rigorous sustainability standards.

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These allegations against Chiquita Banana raised in a context where it is being more difficult for companies to get away with false marketing statements about environmental practices. Consumers are getting more and more conscious about marketing practices of environmental friendly products, and as a consequence legal authorities want to take special care of it and take action against to false claims in advertisement about this respect.

In the past few years the Federal Trade Commission has also found some other bad environmental marketing practices. For example, this year the agency found that three plastic lumber makers, a diaper company, and a plastic manufacturer were exaggerating the environmental benefits of their products. The support of laws against companies that uses promotional terms that are not legally defined it yet has help to stop the bad practices. For example, General Mills who used the term natural in their products were sued by environmental and consumer protection authorities who considered the term natural should not be used on products that actually contained genetically modified ingredients. Other example is that the chicken giant Perdue Farms stopped the use of the phrase humanely raised from one of these labels because it was not a real practice.