Timing is everything as the saying goes. Yesterday Smithfield Foods, the world’s largest pork producer, launched a web site devoted to corporate social responsibility (CSR). Today, The Humane Society of the United States (HSUS) filed a legal complaint with the Securities and Exchange Commission alleging that Smithfield is making false and misleading claims about animal welfare, the environment, and antibiotic use.
Smithfield has long come under fire for its use of gestation crates for breeding pigs. Gestation crates are stalls that are about 2’ wide by 7’ long—about the size of a pig’s body. The floors of the crates are typically concrete and/or slatted wood. They are used to confine the breeding pigs—not those who consumers eat directly—but those who produce the ones consumers eat. The pigs are artificially inseminated, put into the gestation crates for the duration of their pregnancy—about four months, then put into a “farrowing” crate to nurse their young. After a few weeks, their young are prematurely weaned and the breeding pigs are re-impregnated and put back into the gestation crate, pregnancy after pregnancy until they are slaughtered.
According to the HSUS, which is a Smithfield shareholder, “As a result of the intensive confinement, crated sows suffer a number of welfare problems, including poor hygiene, risk of urinary infections, weakened bones, overgrown hooves, poor social interaction, lameness, behavioral restriction, and stereotypies.” Experts, including animal welfare advisor to Smithfield Dr. Temple Grandin, agree that gestation crates are bad for the pigs’ welfare. Grandin has repeatedly condemned gestation crates saying, “I feel very strongly that we’ve got to treat animals right, and the gestation stalls have got to go.”
So what’s the HSUS’s beef with Smithfield? The 28-page HSUS complaint alleges Smithfield made false claims about standards of animal care, like asserting its practices exceed industry standards. Highlighted on Smithfield’s new web site are a series of videos touting its CSR standards. One such video features a veterinarian who is depicted as working for Smithfield explaining to her son that while pigs produced by Smithfield must die, it is the company’s responsibility to provide the “best possible environment, best care that we can make available to them.”
In truth, Smithfield is lagging behind some of its competitors like Cargill, which has switched fifty percent of its system to crate-free and Maxwell Foods, which is completely gestation crate-free. And an HSUS undercover investigation into Smithfield subsidiary Murphy Brown last year documented pigs with abscesses and pressure sores developed from rubbing against the bars and lying on the concrete floors. Others chewed the bars of their crates out of frustration “so incessantly that blood from their mouths coated the fronts of their crates.” The exposé revealed employees jabbing pigs with rods and tossing piglets into carts.
The complaint also states that Smithfield fails to disclose full details about routine surgical procedures performed on its newborn piglets. While it demonstrates that it performs routine castrations and tail docking, the company fails to disclose that the painful procedures are done without a drop of painkiller. According to the HSUS, “The AVMA, however, recommends for such procedures the use of practices that reduce pain, including the use of effective medications whenever possible.”
The complaint also targets Smithfield’s routine broad use of antibiotics and “misleading assertions of ‘organic agriculture.’” Recognizing the public is increasingly concerned about antibiotic resistance due to the use of non-therapeutic antibiotics in animal agriculture, in one of Smithfield’s videos the company states, “We do not use antibiotics for growth-promoting purposes. We use antibiotics for three main purposes: to treat disease, prevent disease, and control disease.” Of course that’s not to say that the company doesn’t give the animals antibiotics even if they’re not sick—just why it does so.
Federal securities law prohibits publicly traded companies from making false statements of material fact or the omission of a material fact that would prevent a statement from being misleading. Smithfield then has a lot of explaining to do. More importantly though, is its responsibility to act as it is suggesting it does by giving the animals in its care the best possible environment. It can start that by setting a true plan and timeline moving away from using crates that prevent pigs from even turning around for months on end. Smithfield, to its credit, says it has switched thirty percent of its sow housing to group housing.