Grocery code of conduct could encourage investment, innovation: advocates

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Two of the grocery code of conduct's biggest advocates say they believe it could spark more investment and innovation by food manufacturers in Canada, hedging against shortages and price volatility in the future.

Michael Graydon, left, Head of FHCP, and Sobeys CEO Michael B. Medline pose for portraits at the Sobeys' offices in Mississauga, Ont., Thursday, Aug. 15, 2024, in a composite image made from two photographs. THE CANADIAN PRESS/Chris YoungTwo of the grocery code of conduct's biggest advocates say they believe it could spark more investment and innovation by food manufacturers in Canada, hedging against shortages and price volatility in the future.

Talk of a grocery code predated the COVID-19 pandemic, but the proverbial straw that broke the camel's back came in 2020 when Walmart and Loblaw introduced new fees for suppliers to help pay for infrastructure investments. Medline told The Canadian Press in a joint interview with Michael Graydon, CEO of the Food, Health & Consumer Products Canada association, that the industry can only benefit from clearer rules over negotiations and disagreements.He said the grocery retail industry in Canada has consolidated over time, resulting in a power imbalance between retailers and suppliers.

The code is set to be officially in place next June, with the creation of an office to oversee it underway.Hiring for the grocery code adjudicator has begun, and the team is working on a more detailed dispute resolution process, Graydon said. There will be mechanisms for arbitration and binding arbitration, but he's hoping most disputes will be ironed out before it comes to that.

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Canada’s grocery code of conduct could encourage investment and innovation, advocates sayMichael Medline, chief executive of Sobeys parent company Empire Co. Ltd, told The Canadian Press that the industry can only benefit from clearer rules over negotiations and disagreements
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