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Horticulture company with varying performance

Varying environmental performance, good working conditions:
Just like a number of other Norwegian companies operating on Sri Lanka, the horticulture company Green Farms is subject to the regulations of the Board of Investment, which is undermining the right for workers to organise. However, managing director Arne Svinningen is of the opinion that trade unions are good for the company, and about 95% of the company's workers are organised. In spite of there being no formal demands to do so, Green Farms has been trying hard to improve its environmental performance during the later years. However, this performance is still varying, and for growing plants, the company makes use of several chemical pesticides that are banned in Norway because of their impacts on the environment and human health.

Artikkelen er mer enn to år gammel. Ting kan ha endret seg.

Varying environmental performance, good working conditions:
Just like a number of other Norwegian companies operating on Sri Lanka, the horticulture company Green Farms is subject to the regulations of the Board of Investment, which is undermining the right for workers to organise. However, managing director Arne Svinningen is of the opinion that trade unions are good for the company, and about 95% of the company's workers are organised. In spite of there being no formal demands to do so, Green Farms has been trying hard to improve its environmental performance during the later years. However, this performance is still varying, and for growing plants, the company makes use of several chemical pesticides that are banned in Norway because of their impacts on the environment and human health.


By Tarjei Leer-Salvesen,
NorWatch
 
- Quite a few years ago, Norwegian politician Håkon Lie, on request from the ILO, assisted Sri Lanka in shaping their laws regarding working conditions, says managing director Arne Svinningen of Green Farms.

- The labour laws secure the right for workers to organise if they wish to do so. I believe trade unions are a good thing. It provides us with orderly conditions for interaction between employees and the management.

- But, though the company is physically located outside the export processing zone, it is subject to the regulations of the Board of Investment. Do you not have to comply with their recommendations?

- Though the Board of Investment is against the establishment of trade unions, they have no reason to put obstacles in our way here. The workers are happy, I am happy, and the company is doing fairly well. If they should come here asking questions, one may simply refer to the country's working conditions act. People have the right to organise, it's as simple as that, Svinningen says.

- Only minimum standards
According to Svinningen, the regulations of the BOI are to bee seen as minimum standards.

- In the BOI regulations, there is no prohibition of trade unions, only a requirement that all companies set up a "joint consultative committee" in which the employees take part with representatives that are elected for one year at a time, Svinningen says.

There is a trade union at the company, in which about 95% of the company's 180 workers are members.

Minimum pay in the EPZs is Rs 2800. At Green Farms, no-one earns less than Rs 3000. Basic pay then varies upwards to Rs 5000. Every year, the employees are entitled to two weeks of holiday and seven sick days. Beyond this, the principle of 'no work, no pay' is applied. Svinningen became managing director of the company in 1986. He has started having yearly talks with all employees, to have the best possible insight into each worker's work situation. At the time when Svinningen became managing director, the absence rate was 25%. According to Svinningen, this has been reduced to less than 3%. The workers are insured against accidents at work and they have an arrangement for old age pension with the company.

Lacking a local partner
Green Farms was established in 1979 as a joint venture between Øivind Lorentzen Trading, Ragnar J. Svinningen AS and five Sri Lankan companies. At the time, Svinningen had a 10% share in the company. In 1983-84 co-operation between the Norwegian and local partners broke down, and all other owners of Green Farms pulled out. Thus, Svinningen was left as the sole owner of the company. The ownership structure was then rearranged, the company being shared between the brothers Ragnar and Arne Svinningen, leaving a small share to Hans Hoegh. In 1986, Arne Svinningen took the post as managing director, and moved to Colombo. Between 1984 and 1996, Green Farms has repeatedly received support from NORAD, through loans and training allowances. However, it has been NORAD's intention all the while, that the company should find a new local partner. At NORAD, there is dissatisfaction that this has taken so long. Finding a new partner was stated by NORAD as a condition for granting loans and training allowances. It is now 15 years since the local partners left the company. According to Svinningen, the company has spent substantial amounts of time, several man-labour years, searching for a suitable local partner, without succeeding. The loans granted by NORAD have still not been paid off.

Svinningen says that competing companies from Denmark and the Benelux countries receive better support from their authorities than what Green Farms got from NORAD. Also, Green Farms has had problems earning sufficiently, which has led to postponement in repaying the loans. Svinningen says NORAD should know that finding a suitable local partner is time consuming. Regarding NORAD's own priorities, he is of the opinion that they pay too little attention to the agricultural sector.

- When it comes to the fact that Green Farms does not have any local partner, NORAD is aware of this. It has been the topic of many talks with the company. One possibility would be to cancel the loan. However, this would possibly have caused serious problems for the company, which is something we do not want. We therefore chose to continue our support, making it a condition that the company make all necessary efforts to find a local partner. They did not find any. Then, a couple of years ago, the law was changed by Parliament, making it no longer obligatory for local interests to be co-owners of companies that receive support, says Hallvard Lesteberg of NORAD.

Less use of pesticides
Certain sectors of the horticulture industry use great quantities of pesticides, thus creating substantial environmental problems and health hazards for workers. According to information gathered by NorWatch, companies subject to the regulations of the Board of Investment are more or less free to do whatever they want regarding use and discharge of such chemicals. On its own initiative, Green Farms has cut its use of pesticides by more than 80% during later years. All 'red-category' chemicals, i.e. the most environmentally damaging and health hazardous chemicals, have been taken out of the production. The company has hired an entomologist and a fungus expert to initiate biological schemes in stead of using chemicals. Whenever pesticides are used, Green Farms has employed two teams, each consisting of six workers, who are specially trained to do so. The protective equipment used by the team at work when NorWatch visited the company seemed satisfactory. Blood tests are taken every half-year of all who work with chemical pest control. In addition, all employees are subject to a yearly general health control. Green Farms owns an area of about 20 ha. Previously, the company has rented an additional 60 hectares to increase production. Presently, the company has rented about 10 ha. The company presently grows a great number of plant species for export. Green Farms also has a separate unit for research and development of new types of plants. About 5% of the production is sold locally, the rest is exported; much of it to Europe, but also to Japan and the USA. Much of the research done by Green Farms, is done in collaboration with the University of Colombo, the Sri Lankan Ministry of Agriculture, the Tea Research institute and Horticulture Research and Development Institute. In the future, bananas and ecologically grown vegetables will be priority areas for the company. Svinningen has already started test production of ecologically grown vegetables on certain areas of the farm.

-Not good enough
In spite of the seemingly high environmental standards of the company, NorWatch asked to receive a list of all pesticides still used in production, whatever quantity they were used at. On this list, we found a few chemicals that are prohibited in Norway because of their association with environmental and health hazards. Alvhild Hedstein is a nature manager by profession, and working with the Norwegian environmental foundation Bellona. She is disappointed that the company has not been able to find substitutes for some of the pesticides still used by the company.

- For example, the pesticide 'Marshal' is prohibited in Norway, and it is associated with great health hazards, Hedstein says.

She also mentions the Applaud, Sevin and Kureta brand names as examples of chemichals with negative environmental effects, and which are not approved for use in Norway. Kureta contains carbofuran (see NorWatch #1/96 , 9/97 and 2/98), and which is produced, among others, by Norwegian company Borregaard in China. In 1997, NORAD turned down an application for support for this kind of production because of  the hazards of its production.

- It seems Green Farms make a distinction between food plants and ornamental plants, and that it is OK to spray with these chemicals as long as people are not eat the plants. This is shown by their wish to produce ecologically grown vegetables. But one should be equally strict with using environmentally unfriendly chemicals whether one is producing ornamental plants or food plants. To nature, it doesn't matter if the plants being sprayed are the one kind or the other. These chemicals may contribute to disrupting the ecosystems, and constitute a risk, Hedstein says. In a letter accompanying the list of chemicals used for production, Green Farms reiterates their efforts with a programme for integrated pest control. For example, this implies that all planted areas are manually inspected weekly, and this way, they have managed to cut the use of pesticides by more than 80%. Bellona is of the opinion that the company should exert itself to find more environmentally sound alternatives to the chemicals that are still being used.

Svinningen on Sri Lanka
Green Farms Ltd is located north of Negombo on Sri Lanka. The company produces green plants and cuttings. Green Farms is owned 52% by Arne Svinningen. 47,9% by Ragnar J. Svinningen, whereas the remaining 0,1% is owned by Hans Hoegh. About 60% of the production is exported to Europe. Merely 5% is sold locally, and the remaining is exported to Northern America, Japan, Taiwan, China and the Middle East. Green Farms has previously received support from NORAD.

Norwatch Newsletter 9/99

- Annonse -