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The End of Cadbury's Moral Vision?

The End of Cadbury's Moral Vision?

It began life 150 years ago as a grocer's shop in Birmingham and became an icon of British business. It ended in January, after Cadbury accepted a takeover bid from the US food giant Kraft. The US company offered 840p per share, which valued Cadbury at £11.5bn. It included 500p in cash, with the rest in Kraft shares, plus the promise of a 10p dividend payable by Cadbury.

Commenting on the takeover, David Cumming, head of UK equities for Standard Life Investments, said: 'It's sad that Cadbury has gone. It's an iconic brand. But business is business and you have to move along.' Business is business, is it? What Mr Cumming means, of course, is that the principal concern of business is to optimise efficiency and maximise profit. The interests of Cadbury's 45,000 employees, the community and the country are secondary.

The takeover means that Kraft is heavily indebted. The more debt you take on, the more pressure there is to cut costs, and jobs. The appalling irony is that Royal Bank of Scotland, 84% of which is owned by UK taxpayers, is loaning £7bn to Kraft to finance the deal.

It was wrong for RBS to lend money to Kraft while British businesses struggle for credit. Of course, efficiency and profit levels are important, but it's wrong for businesses and state-owned banks to prioritise shareholder value over everything else. It goes against everything that John Cadbury and his sons represented. In 1893, George Cadbury, John's son, bought 120 acres of land close to his factory and planned, at his own expense, a model village which would 'alleviate the evils of modern more cramped living conditions'. Business isn't 'just business'. The financial crisis dramatically exposed the flaws of that philosophy. Business should be about the common good. The Cadbury family understood and promoted that idea. And we must recover their moral vision.

This article originally appeared in Christianity Magazine.

Posted 15 August 2011

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