Biotechnology giant Monsanto made a concerted push into the field of bioengineering crops in the mid- to late 1990s. Monsanto‘s genetically modified (GM) seeds were supposed to offer farmers enormous competitive benefits-corn containing natural insecticides, and soybeans able to withstand potent weed killers . Monsanto had a powerful sweet spot proposition: that its pioneering efforts would give the company a leading position in a major new marketplace and provide a powerful new weapon in the battle against world hunger. “Monsanto is in a unique position to contribute to the global future,” declared biodiversity advocate Peter Raven.

But Monsanto executives … failed to work with stakeholders in their development of the new initiative — a core principle of sustainable business. Monsanto dismissed early critics of GM products as antitechnology fanatics and failed to mount a concerted effort to educate consumers about the science behind genetic engineering Monsanto consequently found itself beset by a variety of attacks. A British scientist claimed that rats eating GM potatoes failed to grow properly, and a Cornell university study published in 1999 appeared to show that monarch butterfly caterpillars died after ingesting pollen from bioengineered corn. The accuracy of both claims was quickly challenged, but public fears about “Frankenfoods” now seemed to be bolstered by science.

Several European supermarket chains as well as American natural-food retailers announced that they would remove GM foods from their shelves, and major food companies, such as baby-food maker Gerber, vowed to keep their products free of GM ingredients. Embarrassingly, even the staff canteen at Monsanto’s own UK headquarters announced it would ban GM food from its menu “in response to concern raised by our customers.”

Nonengineered soybeans began to sell at a premium over their modified counterparts — a sign that the market was rejecting GM foods. By the end of 2000, the stock market valued Monsanto’s $5 billion-a-year agricultural business unit at less than zero, despite billions the company had invested in highly advanced science over the previous decade. 

Today the entire biotech industry is still struggling to win acceptance for bioengineered products in Europe and around the world — largely because of Monsanto‘s early failure to consider the demands of sustainability before launching this major business initiative.

In other words, one of the points that makes wrestling with this whole social responsibility arena difficult for many business people is that one of the recognitions coming out of the work is that, often, businesses get constrained in what they can do by either government or private action. In many cases, these actions are prompted by stakeholders and so a prudent business strategy involves dialogue with lots of different players.

This raises several business questions:

• Would an effort to engage in dialog with customers, employees and communities have avoided much of the opposition to GMA crops?
• Would a different attitude by Monsanto have been more sustainable?
• Might it have led Monsanto to do things differently and in a way that might have led to greater success?
• Do sustainability and social responsibility enhance the financial bottom line?

It's hard to say. But we know that NOT engaging in dialog with customers, employees and communities will only lead to disaster.

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