Rotten deals — how corruption spoils our food

It starts at the very origin of food — land. Land corruption has a huge impact on farming and thus on food security, especially of the communities living on and around the land in question. Corruption in land administration can increase levels of poverty and hunger because it reduces access to land and damages the livelihood of small-scale producers, agricultural workers and landless rural and urban poor. In rural areas, corruption in land title and tenure prevents small-scale producers to improve their food security and increase their productivity. The impact of corruption is especially significant in developing countries due to the large number of small-scale landholders in these nations, many of whom are extremely poor. In sub-Saharan Africa and Asia, for instance, 80 per cent of the farmland is managed by smallholders, who provide up to 80 per cent of the food supply in those regions.

Read more on how land corruption affects food security and other vital issues in our topic guide.

But there are numerous corruption risks further down the food supply chain, too. The problem is secrecy. Unscrupulous people are often able to pass off products that aren’t what they say they are along complex supply chains that use shell companies.

The case of the 2013 horse meat scandal illustrates this: Horse meat started its journey labelled as such from a Romanian abattoir, but by the time it ended up in France it was transformed into ‘beef’. Its physical journey had taken it across Europe to the Netherlands and then to France. The paperwork, however, had ping-ponged from Romania, to the Netherlands, to Cyprus and, in at least one instance according to an investigation by the Organized Crime and Corruption Reporting Project (OCCRP), to the well-known secrecy jurisdiction of the British Virgin Islands.

Sometimes, food processing companies are able to operate outside the law simply because they are so big and influential, and are protected by their corrupt networks. The Brazilian meat packing giant JBS is an example of such a company. JBS today is the world’s biggest meatpacker — but its way to the top is paved with legal breaches and scandals, from high-level corruption schemes to terrible labour conditions and environmental crimes. It was able to get away with these things for a long time mainly because, according to a former executive, it was running a massive bribery scheme spending over US$250 million on bribes for politicians across the spectrum. Two years ago, the company was fined US$3.2 billion, one of the biggest fines in history. Read more.

Corruption can affect the supply chain in many ways, and often impedes people’s access to proper food. Strong government institutions are a first step to avoid this, but integrity in global supply chains is the responsibility of private sector companies, too. Together, they need to ensure that rules and regulations are kept and that information about business practices is made accessible. Transparency is the first step towards accountability and improvement.