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Campbell Becomes America's First Public Company to Acquire a Public Benefit Corporation

Originally written for and published on CSRwire's Commentary section Talkback on September 9, 2013. Redefining corporate law. Targeting the node of enterprise to shift capitalism.

By Aman Singh | Published 11 years ago | About a 6 minute read

Originally written for and published on CSRwire's Commentary section Talkback) on September 9, 2013.

Redefining corporate law. Targeting the node of enterprise to shift capitalism.

Those were some of the thoughts running through Neil Grimmer's mind as he joined eight other businesses to welcome benefit corporations in Delaware this July.

As cofounder and President of Plum Organics — along with a small group of parents — Grimmer's philosophy has been pretty straightforward: Every kid deserves the best nutrition and no child deserves to go hungry.

The result: an organic food line that prioritizes nutrition, environmental conservation, reduced packaging and an accompanied mission to target child hunger. Sound like a lot to take on?

Grimmer's conviction came from experience. As the former VP of strategy and innovation at Clif Bar, he knew a thing or two about product development that infuses innovation with sustainable practices. "At Clif, I looked at sustainability as a journey, not a method. We’ve adopted that here at Plum," he says. "Our business success at Plum has been based on creating a great product in a way that respects the highest levels of corporate citizenship. It is actually good business to be a good corporate citizen — and our success speaks to that belief."

Plum Organics went from recording $800,000 in sales in its first year [2008] to $93 million in 2012.

Consider these statistics:

60 percent of retailers in the U.S. carried Plum in the latest quarter
The No. 3 baby food brand in the U.S. after Gerber and Beechnut
The top growing brand in the baby food category by actual dollars and percent growth this year, with 135% growth vs. a year ago

While the numbers tell their own story, here's the kicker.

A Public Benefit Corporation: The Implications

Plum Organics is a certified Benefit Corporation. And now with Delaware's recognition of the legal status, parent company Campbell Soup Company — who announced plans to acquire Plum in May 2013 — becomes the only company in the U.S. with a fully-owned subsidiary that is also a Public Benefit Corporation.

Grimmer is excited — about the notoriety as well as joining hands with an iconic American brand, well known for its altruistic actions and social causes.

"We have a mission centric core: nutrition and solving hunger with our benefit corporation status our secret sauce and innovation driving the entire process. Campbell has a dual mandate: strengthen the core Campbell business while driving new consumers and innovation. It’s a perfect marriage," he explains.

With global aspirations ["Hunger and health are global issues."] and a lofty ambition ["Make sure our products get into every high chair and lunch box globally."], Grimmer "wanted a partner who would drive both [our goals] with us and help us pave the way to address a more global need that kids have. We have innovation driving our core — we launched over 150 products in the last six years specifically addressing nutritional needs of young families."

Aligning Ambition with Impact

After spending some time with Campbell CEO Denise Morrison, Grimmer's search came to an end.

"As our company grew, so did our ability to impact the world," says Grimmer. And being a benefit corporation meant the added leverage of a model that places impact and profits in the same sentence. Like The Full Effect program, which was launched this year to target 16 million kids who go without daily meals every day.

"We now had the scale and capability built into the business to make an impact. So we designed a Super Smoothie jam packed with nutrients," he says.

So far, Plum has committed to producing and distributing half a million Super Smoothies in 2013, with a Smoothie donated for every order placed through Plum's website throughout September, as part of Hunger Action Month. Sound familiar? In 2012, Campbell led a similar campaign to produce more than 40,000 jars of “Just Peachy” salsa exclusively for the Food Bank of South Jersey, using fresh, local New Jersey peaches that were not able to be sold because of blemishes but were fine to eat. The initial run from last year’s harvest generated $100,000 for the Food Bank of South Jersey through retail sales.

"Collaborating with Plum made sense for us on several levels. They're a mission-based organization and their focus on eradicating childhood hunger is strongly aligned with our work nationally and in Camden, NJ — where Campbell is headquartered. That helps build the collective impact we can have."

"Plum and Campbell are both consumer-centric companies, and we share a focus on innovation, a critical component of success as we continue to marry our citizenship commitments with the Campbell business model," responded Dave Stangis, Campbell’s Vice President, Public Affairs and Corporate Responsibility.

Side Effects of An Acquisition

Clearly, the stars align for the two companies but at the end of the day, Campbell is a public company with shareholders and the pressures of satisfying quarterly balance sheets. Will the acquisition bring along with it the familiar headaches of layoffs, changes in management and perhaps even a shift in models?

"Plum is a standalone business and will remain so. I will continue to lead Plum Organics and our team is staying intact," says Grimmer, who plans on remaining an active member of the recently established Plum board of directors. The company will also remain headquartered in California.

Stangis, who has been leading the iconic company's CSR efforts since 2008, was also quick to cut to the chase about the two organizations' merged path going forward. "We're in the process of structuring the Board for Plum. We're proud to say one of our subsidiaries is a founding member of the Public Benefit Corporation league."

“We have already begun working with Neil and the Plum team. We are connecting on joint priorities and sharing Campbell’s CSR and sustainability resources," he added.

"We’re looking forward to leveraging Campbell's capabilities and skills to grow the Plum brand. As we dig into these opportunities, we will also be looking to focus on aligning our public benefit corporation with Campbell's mission, model and culture. They have such a strong CSR program that the opportunities to target hunger are endless," Grimmer explained.

And this is where Grimmer believes the conversation needs to shift.

"There is a new economy emerging of consumers who are looking to purchase from companies with a mission. They're building a virtuous circle. When consumers support a business, you end up growing quickly with more exposure and higher impact," he says.

Of course, being a public benefit corporation is but one element of Plum Organics' success. It's an exciting business story.

But the bigger story here is about being able to make an impact by combining a good product with sustainable attributes and an associated social and environmental cause. And that is where Grimmer wants to push his colleagues across corporate America further.

"The business community needs to look at how they are creating values alignment with their core consumers in a marketplace where loyalty is getting scarce. Let's create many more of those virtuous circles."