Woolies defiant over Israeli suppliers
Lobby group causes havoc at meeting
WOOLWORTHS, which has come under fire for its dealings with Israeli suppliers, yesterday vowed to continue sourcing products from Israel, saying to do otherwise would create an untenable situation whereby lobby groups dictate preferences for its customers.
Boycott, Divestment and Sanctions (BDS) South Africa, which wants Woolworths to ban Israeli products, took its #BoycottWoolworths campaign to the retailer’s annual shareholders meeting in Cape Town, creating havoc at Woolworths headquarters.
About 100 BDS protesters with pro-Palestinian placards descended on the venue, while inside the meeting BDS representatives heckled management, demanding to be treated like every other shareholder.
BDS has criticised Woolworths for its reluctance to meet with the group to understand its grievances.
However, in an about-turn, Woolworths management now planned to meet with BDS, which has led calls for a boycott since August, Bloomberg cited Woolworths chairman Simon Susman as saying.
Last week BDS, which wants a total ban on Israeli products, roped into the fray people it described as Woolworths shareholders in its bid to pile more pressure on the retailer. Even so, Susman said the retailer would not remove Israeli products from its shelves.
“Our job is to provide customers with range of products they want from Woolies and in doing that we have some quite strict ethical standards on how our suppliers treat their staff, hygiene and the environment,” he said in an interview.
Speaking to shareholders at the meeting, Susman said: “We have repeatedly stated we do not source from the occupied territories. I can assure you we are not breaching international law.”
Susman said as much as there were many interested groups on the issue of trade with Israel, there were also anti-groups of various things that businesses do.
“We have to steer that fine line on how we procure our products in the best manner that is ethical,” he told Business Report.
Board members that were either retiring or being introduced at the meeting were also asked about ethical trading.
The fact that they are withholding supply information means that they are hiding something.
While the protest outside remained calm, the atmosphere inside the meeting was tense, with the issue of Israeli products a dominant theme.
Woolworths has said currently it only imported three products from Israel: figs, pomegranates and pretzels, worth R12 million. The retailer sources some 95 percent of its food products locally.
The meeting became chaotic at one stage when Susman read out voting results. While shareholders who appeared not bothered by Woolworths trading links with Israel cheered the resolutions receiving more than 90 percent of the votes, the BDS-aligned shareholder contingent objected, calling Susman to order. Susman announced the result amid shouting and objections.
Susman said Woolworths found itself in a difficult situation because it serviced a divergent base of customers. During the meeting he repeatedly said Woolworths was not breaking any trading rules.
“Management feels that we are protected by the constitution and by the rules of the land to trade with whoever we want. Secondly, we have many divergent customer groups,” said Susman.
The board members were questioned if Woolworths paid VAT on imported products from Israel, to which they said they did. Questions about the identities of its Israel suppliers and claims that Woolworths’ new Australian business David Jones was sourcing its Soda Stream product from occupied territories in Palestine were not addressed. Woolworths said its supplier information was confidential.
BDS leader Mohammed Desai said Woolworths was being targeted because it preached ethics. He said he was aware that many other retailers and businesses traded with Israel “but Woolworths is the first company we want to deal with. This is a build up and things are about to heat up.”
But asked whether BDS had evidence that Woolworths was sourcing from occupied territories, Desai said he had none “but the fact that they are withholding supply information means that they are hiding something”.
Susman said it was difficult to see evidence that the protests had impacted sales, but confirmed that stores which were targeted had been disrupted.
He said Woolworths could not hide behind the fact that it was the only retailer that has been targeted by BDS.
“They have chosen to target us because they feel that if they can get us to change, they can get a knock on [effect for] businesses to change.”
He contended that there was a whole lot of Israeli technology which was deeply entrenched in South Africa such as the irrigation, telecommunication and medical treatment systems, but nobody was taking issue with that.
Susman said there was no middle ground when it came to which country to trade with because either one was free to trade or not.
“The best thing is to stick to our principles and that is the view shared by the management,” added Susman. Woolworths shares fell 0.89 percent to R79.30 yesterday.
Pro-Palestinian supporters protest outside Woolworths headquarters in Cape Town yesterday.