Big Business is part of the Big Society too.

I was struck last week by Coca Cola’s announcement that they are to close Malvern Water, a small, 23 year old company extracting water from the spa favoured by Charles Darwin in his struggle to find a cure for his life-long sickness (many of his visits were recalled in last year’s brilliant film Creation).  What struck me most about this announcement was that there was no mention in any of the many media reports about the profitability of Malvern.  I have since searched high and low for Coca Cola’s profits broken down by brands, without success (Coca Cola, on being asked to comment, sent me their press release which makes no mention of brand profitability).

What is interesting about this announcement is the supposed rationale of the sale.  Coca Cola made much in its press release about the difficulty it had extracting more than relatively small quantities of water and the effect that had on Malvern’s competitiveness.  But it made no mention of its profitability.  Now, maybe I will soon learn that the plant was unprofitable and/or that it was predicted to go into loss.  Yet, one might expect that such business records and predictions would be at the forefront of Coca Cola’s justification for the closure – especially as it had such heavy criticism from Unite and the local community.  That they did not is telling; and suggests that the reason for the sale lies elsewhere.

For one did not need to look far in the press reports to see that, rather than attempting to sell the business as a going concern, Coca Cola intend to develop the plant and sell it as ‘luxury housing’.  For all their glossy literature on corporate responsibility, Coca Cola have been found wanting.  If my suspicion on Malvern’s profitability is right 17 sustainable jobs have been exchanged for housing for (perhaps) a similar number of people.  Their reaction to this (in their press release reproduced below) is that residents of Malvern wouldn’t want the plant to continue in industrial use with all the smoke and congestion that would cause.  What are they expecting – a steel processing plant?  It is this sort of attitude that condemns towns like Malvern to become picturesque tourist towns filled with wealthy commuters.

Of course it is difficult to criticise individual corporate decisions from outside the business in question.  One doesn’t have access to balance sheets, business predictions, attempts that might have been made to sell the subsidiary and so on.  But lack of access to these records should not excuse big business – as much as big government – from scrutiny over its decisions and their justification.  In this case, it is reasonable to ask what steps Coca Cola has made to sell the business as a going concern – one with a Royal Warrant, no less; and whether it has turned its mind to alternative industrial uses for the plant.

David Cameron’s speech yesterday revived the organic conservatism many have long identified in his championship of the Big Society:  “Successful, high-growth economies are like ecosystems –they are organic, evolve through trial and error and depend on millions, billions, of individual preferences, choices and relationships. Governments can expect to intelligently design all this as much they can expect to intelligently design the Great Barrier Reef.” (Darwin would approve.)  He is right, of course.  But the organic society removes control from government only because it believes in the corporate responsibility of which Coca Cola boasts.  Decisions like this condemn our market towns to become museums of the thriving, small business led communities of their past.

NB:

Coca Cola, on being asked to comment, sent me a copy of their press release and pointed to Malvern’s market share in the ‘notes to editors’.  Notwithstanding a specific request for the recent profit levels of Malvern, they did not provide that information.  I reproduce the press release in full as a ‘comment’ below.

Advertisements