August 30, 2012 / 9:14 PM / 7 years ago

Animal activists tap Wall Street to change farm practices

CHICAGO (Reuters) - The Humane Society of the United States has bought shares in four major financial services companies in a bid to use shareholder pressure to force two of the nation’s largest pork producers to stop housing pregnant sows in gestation stalls.

The animal rights group said Thursday that its investment - a relatively small $3,000 or so worth of stock in each company, but large enough to introduce proposals during shareholder meetings - was targeted at investors in Tyson Foods Inc(TSN.N) and Seaboard Foods, a unit of Seaboard Corp(SEB.A).

The group has successfully used such shareholder advocacy in the past to pressure food and agriculture companies to change corporate buying habits and production practices.

Now, the Humane Society is taking a new strategy: tell investors in the livestock industry it’s a bad financial move for farmers to use this equipment.

The Humane Society said it plans to introduce shareholder proposals next year that, among other things, will point out that dozens of food retailers have vowed to eventually only buy pork from farmers and other sources that don’t use gestation stalls. By not changing over to alternative animal housing, claims the group, Tyson and Seaboard are putting their lucrative contracts with these customers at risk.

McDonald’s, the nation’s top hamburger chain by sales, vowed in May that its U.S. business would only buy pork from farmers and other sources that do not use gestation stalls for housing their pregnant sows by 2022. Such stalls are used to confine sows during the breeding and post-birth process.

“We’ve tried talking with <Tyson and Seaboard> and they refuse to make any progress,” said Humane Society food policy director Matthew Prescott.

So the Humane Society decided to put the pressure on in a less-direct route and press its case with Tyson investors: JP Morgan Chase(JPM.N), the biggest U.S. commercial and investment bank by assets; BlackRock(BLK.N), the world’s biggest asset manager; Jennison Associates, a subsidiary of Prudential Financial(PRU.N), the second-largest U.S. life insurer; and Ameriprise Financial(AMP.N), a financial services company.

BlackRock also is a leading investor in Seaboard, Prescott said.

Tyson Foods told Reuters in an email that it is committed to humane animal treatment at all stages of food production, and expects the same from those farmers who supply products to it.

“We buys hogs from thousands of family farms, many of whom use gestation stalls for mother pigs and some of whom have group or pen housing. Experts believe both housing systems are humane for mother pigs when managed properly,” the company said in its statement.

“We are continuously monitoring the demands and preferences of our customers and their consumers regarding this topic and will work to respond to their needs as efficiently as possible,” the company said.

Seaboard Foods, the nation’s third-largest pork producer, could not be reached for comment. A spokesman for JP Morgan Chase declined to comment. None of the other financial services firms could be reached for comment.

The move marks the latest salvo in the war over how food is produced in the United States, with farmers and agribusiness on one side and food safety groups and animal-rights organizations on the other.

The Humane Society and other activists say their goal is to pull back the curtain on the nation’s food supply, and are using undercover videos shot at farms, social media campaigns and shareholder activism to prompt the food and agricultural industries to change.

The campaign has been increasingly successful in recent years: Earlier this month, the U.S. Department of Agriculture temporarily shut down a California slaughterhouse after undercover video showed cows being mistreated during the slaughtering process.

Gestation crates are typically metal enclosures, about 7 feet long and 2 feet wide, in which a breeding sow is housed for much of her adult life.

Pork producers say these enclosures are necessary to protect young piglets from being crushed by larger animals, and to keep sows from fighting as they often will when housed together in larger pens. Animal rights groups say such stalls are too small and constitute inhumane treatment of the animals.

Reporting By P.J. Huffstutter; Editing by Bob Burgdorfer

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