Rosenfeld no-show at Kraft probe angers lawmakers
LONDON — British lawmakers attacked Kraft Food Inc. Chief Executive Irene Rosenfeld on Tuesday for refusing to appear for the second time before an inquiry into the U.S. company's takeover of chocolate maker Cadbury.
Rosenfeld's absence dominated a hearing by the cross-party Business Select Committee into whether Kraft has kept promises it made after the takeover a year ago about protecting jobs in Britain.
A trio of underlings was instead left to tell disgruntled lawmakers that the Northfield-based company could not extend guarantees about preserving manufacturing positions beyond next year.
Rosenfeld's decision to spurn invitations to appear before the committee — either in person or via video link from the United States — has further strained Kraft's already fraught political relations in Britain.
Last year's 11.5 billion pounds ($18.5 billion) hostile takeover of one of Britain's most-loved companies was a touchstone for a wider debate about the country's foreign takeover laws.
Kraft didn't help win fans locally by promising during the takeover bid to keep open a factory employing some 400 workers — only to announce its closure to switch production to Poland once the deal was sealed.
Lawmakers on Tuesday spent 45 minutes quizzing Executive Vice President Marc Firestone, who was joined by Trevor Bond, President of Markets in Europe, and Nick Bunker, President of UK and Ireland, about Rosenfeld's no-show at both the first hearing a year ago and the current gathering.
David Ward, a member of the junior government coalition party the Liberal Democrats, said Rosenfeld's refusal to appear before the committee was a "slap in the face" and "quite contemptuous."
Committee chairman Adrian Bailey, a member of the opposition Labour Party, complained about Rosenfeld's "failure and refusal" to answer questions.
Firestone insisted that the three executives who did appear were competent to answer all queries but was forced to acknowledge at least one failing: "Can you make decisions on closing factories?" asked Bailey. "No sir," replied Firestone.
Bailey asked how a CEO who failed to appear before a U.S. Congressional hearing when summoned would appear to the U.S. public.
Firestone kept calm throughout the grilling, but stood by comments he made in a letter to the committee that previous meetings had gone beyond "spirited debate" to "a remarkable level of rancour."
The committee last year accused Kraft of acting "irresponsibly and unwisely" during the takeover, largely because of its controversial backtrack over the factory in Somerdale, western England.
Bunker said Tuesday that of the 400 workers who lost their jobs at Somerdale, 100 had found other employment, 80 had retired and 26 had moved to other Kraft sites.
All three executives said they believed it was time to move on from the controversy surrounding the takeover and the Somerdale closure and grow the business so that the remaining sites across Britain, employing 5,500 workers, could thrive.
Bunker said that Kraft continued to review its British business, adding that the company had just had a "very good" year.
"As long as our business continues to grow, our manufacturing sites will thrive," he added.
However, Bond acknowledged that the company was not able to extend its guarantee about no forced redundancies in manufacturing beyond next year — a pledge it made a year ago.
The Unite union is concerned that Kraft is reluctant to share its five to ten year plan, fearing that job cuts will be made once the moratorium is up.
"Across the world Kraft has a history of closing sites and dumping workers just to pay down debt," said Jennie Formby, Unite national officer.