Bright image dulled by scandal
Updated: 2012-10-08 08:10
By Hong Liang (China Daily)
Five scandals in the past three months have not only dulled the image of Bright Dairy, they have also dented the pride of Shanghai, its hometown.
For years, Bright Dairy, a government-controlled enterprise listed on the Shanghai Stock Exchange, has ranked among the top of Shanghai's most recognized and trusted indigenous brands. Its wide range of dairy products once stood for quality that was taken for granted by Shanghai consumers.
And the spate of safety issues that in the past several years dragged the names of some of the country's biggest dairy producers through the mud seemed to only boost Bright Dairy's ambition to secure the top spot in the nationwide market. But perhaps in the rush to grab market share something precious, like quality and safety, has fallen through the cracks.
Of course, companies make mistakes every now and then. Even mighty Apple was embarrassed by a glaring glitch in its latest mobile operating system. I am sure Apple, which was quick to acknowledge the issue, will make amends soon and all will be forgiven and forgotten.
Not so with Bright Dairy, whose management's stonewalling and arrogant attitude in response to consumers' complaints and media enquiries about the quality and safety of some of its products have shown up a common shortcoming among mainland enterprises in public relations and crisis management. For example, in the latest complaints about the use of an additive that has been banned for years in one of the company's baby food products, Bright Dairy's response was disingenuous and deceiving to many consumers.
Conceding that the milk minerals, which are not allowed in baby products as they are relatively new and it is not yet known if they are harmful to infants, were indeed used in the cheese product, the company insisted that they were harmless. It said the milk minerals were included in the product before they were banned in 2009 and that the product is not meant to be only for babies despite the packaging, which says it is for infants aged 1 to 3. It said that it would relaunch the product with new packaging.
This may sound like a joke. But no one is laughing.
According to a Xinhua News Agency report, the Shanghai Municipal Bureau of Quality and Technical Supervision on Sept 20 said that its records showed previous filings by Bright Dairy failed to disclose the full contents of the baby food in question. There are indications that Bright Dairy engaged in the "untrustworthy" practice of hiding the facts, the bureau said.
On Sept 8, batches of bottled milk delivered to several districts in Shanghai were found to have gone off. In other cases, the quality of some of the company's milk products was brought into question in Guangdong and Anhui provinces. In one case, the company's milk was found to contain residue of washing detergent.
These missteps have prompted the deputy director of the Shanghai quality agency to say: "Bright Dairy must try to live up to the word 'bright' in its name."
It is obvious that all is not well with the company. As might be expected, the company was pummeled by the market, with its shares falling nearly 8 percent in the past few weeks, compared with a less than 2 percent decline in the widely followed Shanghai Composite Index.
Other than a few half-hearted apologies, Bright Dairy hasn't said much and it hasn't disclosed what it plans to do to restore consumers' confidence in its products. The notion that Chinese consumers are the most forgiving and have short memories may be true. But any enterprise that counts on that to survive doesn't deserve to live long, whoever the owner is.
(China Daily 10/08/2012 page8)