FTSE, WHO Code and the Infant Formula Industry

Abstract

FTSE4Good, which was designed to act as a tool for investors who are interested in companies with acknowledged records of corporate social responsibility including environmental sustainability, human rights and stakeholder involvement [7] . Following discussions with UNICEF, FTSE4Good has now established an index for companies that operate in the BMS sector with the expectation that these companies will secure their inclusion in the FTSE4Good investment index by demonstrating that they meet specific marketing standards [8, 9] . The FTSE4Good BMS Marketing Committee has collaborated with an independent provider of research into company governance and ethical performance (EIRIS), and developed BMS marketing criteria that not only build on the WHO Code and subsequent World Health Alliance resolutions but also address the need for effective internal company management systems. This process included consultation with companies, investors and non-governmental organizations, including both UNICEF UK and Save the Children. If a BMS manufacturer meets the criteria to be included in the index, the company will then have an independent verification assessment to determine if their practices on the ground follow their policies [10] . This will In 1981, the Thirty-Fourth World Health Alliance adopted the fourth draft of the International Code of Marketing of Breast Milk Substitutes (BMS), with the expectation that the Code would contribute to the safe and adequate provision of nutrition for infants, and in particular protect and promote breastfeeding [1, 2] . It was also anticipated that the Code would provide the framework for effective cooperation between key stakeholders; however, this has not been fulfilled and the self-governing arrangements set out in the Code have failed to prevent 3 decades of acrimonious exchanges and boycotts, predominantly between non-governmental organizations and industry [3] . In the meantime, non-compliance with the Code continues to be reported [4] . It has been proposed that there is an urgent requirement for the establishment of independent international governance structures that are transparent, sustainable and effective [5] . An unexpected but interesting governance initiative has now emerged. The initiative is led by the FTSE Group, which is an independent company jointly owned by the Financial Times and London Stock Exchange Group and is a world leader in the development of indices used by investors to assess business portfolios, performance and risks [6] . It is most widely known for its indices relating to financial markets. In 2001, FTSE launched Received: February 14, 2012 Accepted: February 18, 2012 Published online: April 20, 2012