On September 23, 2022, Roger Federer’s tennis career came to an end. On that day, Federer said goodbye to the sports world in a double match with his greatest rival: Rafael Nadal. Federer and Nadal faced each other professionally on more than 40 occasions, including nine Grand Slam finals, and consolidated the greatest sporting rivalry ever recorded in tennis.
On September 23, Nadal said in tears that an important part of his life was leaving and confirmed that the rivalry had given way to mutual recognition and respect. This situation, although infrequent, is not atypical in the sports world. In business, however, it is very difficult, if not impossible, to identify examples of companies that provide fair competition for all market players.
Of cheese and pine trees
In Costa Rica, among the many cases of unfair competition, we can cite the confrontation that took place around Turrialba cheese between the associations of Productores Agropecuarios de Santa Cruz and Consejo Regulador de la Denominación de Origen Queso Turrialba; and the Cooperative of Milk Producers Dos Pinos R.L. and the Sigma company. This is a very different case from the competition between two opponents with equivalent capabilities, such as Federer and Nadal, and is reminiscent instead of the unequal confrontation told in the biblical story of David and Goliath.
Since 2012, Turrialba cheese has had a Denomination of Origin (DO). With this indication on the product label, it is guaranteed that the cheese was made with milk from cows fed on the pastures that grow on the slopes of the Turrialba Volcano, with production processes that have been inherited for more than 150 years. However, in a lawsuit filed with the Contentious Administrative Court, Dos Pinos requested that this DO be revoked because they had registered the trademark “Turrialba type cheese” in 2004.
The judgment of this trial was issued last April and recognized the possibility that the DO and the trademark registered by Dos Pinos can coexist, that is to say, that at the moment of going to the supermarket and consumers have to decide which type of cheese to buy, they can select between Turrialba cheese and Turrialba type cheese. This is a decision that points to inequality.
According to the weekly El Financiero, the only Turrialba cheese currently marketed in supermarkets belongs to the Del Guayabal brand, which represents less than 1% of sales. Sales data for Dos Pinos Turrialba type cheese are not available, but it is known that this brand is the favorite of Costa Ricans and is present in 99% of households, according to the Brand Foodtprint Centroamerica 2022 ranking.
The position of Dos Pinos in this context is striking. It is not expected that a company that includes solidarity and integrity among its values would initiate a lawsuit against such an unequal competitor in a market in which, by all accounts, it seems to have completely covered. Moreover, it is even more confusing when we see that Dos Pinos ranks second out of a hundred companies as the most responsible company in environmental, social, and governance (ESG) issues in Costa Rica, only surpassed by Florida Ice and Farm (FIFCO), according to the Merco 2022 ranking.
Environmental, social and governance (ESG) issues arise from the recognition by companies that it is essential to have a sustainable business. This means managing three pillars: economic, social and environmental. The economic pillar has evolved and beyond the idea of making the business profitable, companies are looking for one that defines and implements corporate governance criteria. In most organizations, governance has been precisely the hidden pine, or rather, the least recognized pillar in ESG risk management.
Actions and values
Due to this lack of knowledge regarding governance components, the World Economic Forum’s Global Future Council on Transparency and Anti-Corruption developed, in 2022, a basic list of factors that should be covered when assessing corporate governance.
These factors are: business ethics, board composition, corporate leadership, risk and crisis management, resource allocation, incentive structures, political accountability, transparency, anti-corruption and integrity, fair competitive practices, stakeholder engagement and supply/value chain management.
Dos Pinos website announces the reinforcement of the welfare strategy for its employees, the launching of the first soil recarbonization program, the results of its industrial waste management and even the replacement of plastic straws in products that require it, for recyclable paper alternatives. These are excellent examples of its environmental and social management, although there is only one news item on this site that could be related to governance and highlights, paradoxically, the boost given by the cooperative to the linkages of thousands of small and medium-sized companies in the country.
Dos Pinos will always be called to be a national reference. We all grew up consuming this brand and many of us identify with and take pride in its successful cooperative model. That is why it is outrageous that its actions are so far removed from its values. And it is even more disappointing that there are no explanations about the reasons that led this company to file a lawsuit against the denomination of origin of Turrialba cheese. Why did they make this decision?
The only answer to that question appears in the statements published after the judgment of the trial, from a Dos Pinos representative who indicated that they were trying to respect the precedent of the trademark registration and that there was no mutual affectation between sales of Turrialba cheese and Turrialba-type cheese. What component of Dos Pinos’ sustainability strategy drove this decision? We do not know. At the moment it is only possible to speculate that it was a good intention.
Governance factors such as business ethics or fair competitive practices must be measured and evaluated as strictly as environmental and social management, not only in Dos Pinos but in any company that boasts of being sustainable. We cannot build a better future if we are disloyal to our competitors. The example of rivalries such as that of tennis players Roger Federer and Rafael Nadal show us that facing a good competitor does not demean us, but on the contrary, allows us to bring out the best in ourselves. Let’s not promote David versus Goliath competitions. Let’s be a better version of ourselves.