Bananas: breakthrough commitment in Dutch retail

The closing session of the congress highlighted the first ever country-wide commitment from retailers to close the living wage gap in the banana supply chain. The goal of the Banana Commitment is to predominantly sell bananas in Dutch supermarkets of which production workers have earned a living wage.

“I’m so excited to share with you today the commitment we’ve made with other Dutch retailers”, said Laura Jungmann, Team Lead Sustainability at Albert Heijn, the largest supermarket chain in the Netherlands. “As a company we’ve been working on fair and transparent supply chains for years. But we also know that living wages can only be achieved if we work together as Dutch retailers.”

The partnering retailers aim is to reduce the gap between the currently paid wages and the living wage for their entire banana assortment by at least 75% within five years. The retailers will use the Salary Matrix, made available by IDH, to calculate the difference between the current wages and the living wage. By using the tool, they can analyse current wages in the supplying locations of their total banana assortment. This will serve as the baseline from which future wages will be compared. From 2021 onwards, they will gradually bridge the living wage gap by at least 10% each year.

The commitment is part of the Dutch Agreement for the Food Products Sector on International Responsible Business Conduct. IDH is taking the lead in convening the Dutch banana retail sector to work jointly on concrete projects on living wage. According to the supermarkets involved, the Banana Retail Commitment is an important milestone. Supermarkets are competitors, but when it comes to a more sustainable supply chain and risk reduction, private sector parties can certainly work together. For example, through dialogue with local governments and trade unions, insight can be gained into local challenges and solutions. If the banana commitment will be a success, the way is paved for other products.

“We choose to work on living wage because we know that workers who earn a living wage are empowered to break the poverty cycle”, said Jungmann. “But we can only do this together. Learning from each other’s mistakes, continue to push each other to realise these targets over the next five years.”

IDH will continue to invite other interested private sector parties to join the Banana Retail Commitment, such as supermarkets in other countries outside the Netherlands, said Jordy van Honk, program director at IDH. “This will increase the positive impact on living wages.”