February 9, 2023:  

Investor Advocates for Social Justice (IASJ), standing in solidarity with our partners at Venceremos and the workers whom they represent, call on Tyson Foods, Inc. (Tyson) to honor its commitment to conduct an independent Racial Equity Audit (REA) within a year. One year and three months after Tyson’s commitment, there is no indication that Tyson has started conducting the REA. The REA should be prioritized, conducted in an independent and expeditious manner, and involve meaningful consultation and input from affected workers and other relevant stakeholders. 

In August 2021, investors called on Tyson  to conduct an independent racial equity audit to analyze how Tyson’s policies and practices discriminate against or disparately impact communities of color. Our concerns were largely related to the unsafe working conditions, unfair promotion practices, and racial discrimination and harassment in Tyson’s meatpacking plants – conditions that were exacerbated by the COVID-19 pandemic and that predominantly affected Latinx and Black workers. We urged the Company to conduct an REA, emphasizing the urgency of the matter and calling on Tyson to assess its behavior through a racial equity lens to obtain a complete picture of how it contributes to, and could help dismantle, systemic racism in its value chain.

In November 2021, Tyson committed to conduct an REA, which would be carried out by an independent group and involve meaningful input from affected workers and other relevant stakeholders. Moreover, the Company stated its goal of publishing the findings of the REA within a year. More than one year later, there are no published findings, no public update by the Company on the progress of the REA, and no indication of meaningful consultation with affected workers. 

This week, the Tyson numbers were made public. Tyson Foods reported a 72% decline in quarterly profits.  For a three-month period, profits fell to $316 million compared to $1.1 billion a year earlier. Tyson CEO Donnie King believes these numbers are a reflection of current market conditions.  However, without an independent Racial Equity Audit to identify Tyson’s human rights risks, it is very difficult for investors to assess the magnitude and impact of the company’s actions currently and in the foreseeable future. For example, when CFO John R. Tyson was arrested this past November, Tyson shares fell 3.1%, down 25% year-to-date, outpacing the S&P 500’s 21% loss. Additionally, Bank of America downgraded Tyson’s stock from neutral to underperforming.

It is important to remind Tyson of the gravity of its conduct during the COVID-19 pandemic that sparked the push for an REA in the first place. Tyson’s failure to protect its workers during the COVID-19 pandemic and active opposition to federal and state health emergency safeguards, as outlined in two separate Congressional reports, “may have…disproportionately impacted minority meatpacking workers,” who make up over 70% of Tyson’s hourly workers. The May 2022 Congressional report details the concerted efforts by the meatpacking industry to successfully lobby the Trump administration “to advocate for Department of Labor policies that deprived their employees of benefits if they chose to stay home or quit, while also seeking insulation from legal liability if their workers fell ill or died on the job.” Moreover, these disparate impacts on Latinx and Black workers also extended to the surrounding communities, as coronavirus outbreaks at meatpacking facilities “likely increased the infection rates in the surrounding communities by significant margins.”

The manner in which Tyson handled the COVID-19 pandemic, by disregarding the safety and lives of its predominantly minority frontline workers and their communities, was just a symptom of a larger problem within the Company: pervasive and entrenched racial injustice. These same patterns of racial injustice towards Latinx and Black workers within its value chain persist. Most recently, on November 9th, following an almost three-months investigation, the Department of Labor (DOL) announced that PSSI (who is one of Tyson’s vendors) had illegally employed 31 children to work the graveyard sanitation shift in three large meat and poultry plants in Minnesota and Nebraska.  According to reports, the children in question ranged in age from 13-17 years old. Several of the children had suffered chemical burns from the toxic cleaning compounds and high pressure hoses used in these very dangerous jobs. A similar DOL investigation was recently opened at a Tyson Foods plant in Sedalia, Missouri.

We have also been informed that Tyson has switched its work requests system to an online app, called WorkDay, which presents a formidable barrier to those Tyson workers whose primary language is not English and to those who do not have access to a smartphone or data. Currently, workers must use the app for things like requesting to change job positions, changing info about taxes, and accessing pay stubs. There is information indicating that Tyson intends to migrate its vacation requests to the app later this year, which would be an additional barrier for workers (who often request vacation time to see a doctor).  Because workers have to download this app on their personal phones (if they have one), there are additional privacy concerns. This has served to further marginalize the voices of Tyson’s Black and Brown workers. 

We call on Tyson to expeditiously and properly conduct the REA it committed to over a year ago. The REA must be independent. For it to be effective, an independent auditor should have demonstrated experience advancing racial justice and  should bring deep relationships with worker groups. If an REA is not conducted in a “robust manner by fully independent third parties ,” or is conducted hastily or haphazardly, the audit “may instead increase further reputational risk.” Additionally, the REA must include meaningful input from Tyson’s workers and other stakeholders impacted by racial discrimination. Lastly, the REA must be completed as soon as possible. Experience from the investor community working closely with auditing firms shows that a robust REA typically takes around one year to complete. For example, Citi agreed to conduct an REA in October 2021, and it published the results of the REA in December 2022. 

As faith-based asset owners and mission aligned investors, we remain deeply concerned about how Tyson’s business operations, policies, and practices, as they relate to workers and communities of color, continue to pose significant material risks to the company and all of its stakeholders. We are proud to stand with our brothers and sisters at Venceremos, which aptly, means “we will overcome.” Together, shareholders and workers urge Tyson to conduct this independent REA expeditiously and properly.