As of now, General Mills does not directly engage in business in Israeli settlements that support Israel. General Mills sold 60% of its Israeli entity that produced Pillsbury products in the illegal Israeli settlement of Atarot Industrial Zone in the occupied West Bank in 2022.
General Mills directly conducted business in the settlements before the sale. But General Mills stated that it had nothing to do with a boycott and was simply a business action related to the larger strategy of the company. Annie’s, Blue Buffalo, Fresca, Latina, Tiki Pets, Totino’s, Jeno’s, Progresso, Colombo, and Lärabar are other company brands. Outside of the United States and Canada, it also manufactures Häagen-Dazs ice cream. In 2016, General Mills purchased the meat-based company Epic Provisions.
Background of General Mills and Pillsbury
General Mills, an American global food company formed in 1928 from the merger of several mills, is now one of the largest food companies worldwide and an international source for food innovations from tear-strip packaging to puffed cereal. In 2001, General Mills acquired The Pillsbury Company, which greatly expanded its products and offered many new categories of food products.
Pillsbury began as a Minneapolis, Minnesota, flour milling company in 1869 and established a brand with the Pillsbury Doughboy and a line of baking products and refrigerated dough.
The acquisition combined General Mills’ cereal and snack brands with Pillsbury’s many convenient baking and food products, resulting in a global food industry leader and over 100 brands. This acquisition marked an important milestone in General Mills’ development as a major global food company committed to delivering great-tasting meals across diverse food categories.
The Israeli settlement controversy
General Mills, the American multinational food company that originated when many mills (including Washburn-Crosby) merged in 1928 and is now one of the largest food companies globally, is the one company we have all learned about, with its innovations in food (including tear-strip packaging and puffed cereal). In 2001, General Mills acquired The Pillsbury Company, which resulted in some new product lines being added to the company, but also lent itself to a much larger variety of new food product lines.
Pillsbury began as a flour milling company in 1869, with headquarters located in Minneapolis, and has established its own brand image with the famous Pillsbury Doughboy logo, along with an entire line of baking products and refrigerated dough.
The purchase effectively consolidated General Mills’ brands in cereals and snacks, with a plethora of convenience baking and food products from Pillsbury, resulting in a leading food company with over one hundred brands in the food sector.
This acquisition is an important moment in General Mills’ company history in that it continues to develop itself into a major global food company in the food industry, and the company’s commitment to continue delivering to consumers great-tasting meals across a broad range of food categories.
The authors expressed ethics regarding business and human rights in contested territories. The case illustrates complex challenges businesses experience in places like Israel, particularly when corporate responsibility conflicts with financial priorities related to geopolitics. Businesses have to fight the competing moral values against business purposes, and the General Mills divestiture of the Atarot acquisition is one instance of these dynamics.
General Mills’ divestment decision in 2022
General Mills announced in 2022 that it would sell a 60 percent stake in its joint venture for Israeli dough products to its local partner, Bodan Holdings. The company had been operating under the Pillsbury name in East Jerusalem’s Atarot Industrial Zone. The decision was part of General Mills’ restructuring of its global portfolio and focus on markets with better growth opportunities. The company reported it was a business decision, not a political one.
However, activists claimed public pressure led to the sale. After the Pillsbury plant was cited in a UN list of companies operating Israeli settlements, groups like human rights organizations called for a boycott of the Pillsbury plant. The American Friends Service Committee and others saw it as a victory over some campaigns. Still, General Mills declared the transaction was not in relation to the BDS movement.
In fiscal year 2022, total pre-tax divestiture gains for the company reached 194 million dollars. The company assured that it did not see these types of portfolio adjustments as a long-term impediment of time impeding future growth. The business has been linked to social media marketing and dietitian education that support the “anti-diet” trend. This activity has been linked to aiding in the promotion of some of its own sugar-rich foods.
Business vs. political motivations
There were questions about whether political or business issues affected General Mills’ divestiture in 2022. In the company’s public summary, it clarified that the divestiture occurred solely for business reasons. It stated that it wished to “simplify its global operations” and focus on “markets that show stronger growth.” The sale was part of a broader business strategy to simplify its portfolio and return to profitability. In addition, divesting from the Israeli joint venture aligned with General Mills’ overall global strategy to exit companies that were smaller quantitatively or lower-margin relative to its other companies.
Nevertheless, many people perceived political influence because of the timing and place of the sale. The Pillsbury facility was in East Jerusalem, which is considered occupied territory by international law.
Activists had long called for a boycott of General Mills through the BDS movement. In the wake of the news about the sale, those groups announced victory. They suggested the news related to divestiture seemed to signal the effectiveness of ethical and public action against companies associated with settlement-restricted businesses. Still, General Mills asserted that the action had no connection to any activism. As part of making its point, the company publicly stated they were still selling products in Israel to show it was not taking a political position one way or the other.
Reaction from human rights groups and activists
The action was also lauded by the Boycott, Divestment, and Sanctions movement. Activists argued it demonstrated that the public could force multinational corporations to stop profiting off what they considered human rights violations in Israeli settlements. General Mills is committed to making cage-free US products by 2025 and established a plan for the phase-out of products utilizing eggs from caged birds in 2015. The commitment was broadened in 2017 to include chickens from the company’s international operations in addition to the US.
The Pillsbury production facility was located in the Atarot Industrial Zone, frequently condemned by international observers across the board as located on occupied land, and about which advocates activated public engagement.
The United Nations released a directory of businesses operating in the occupied Golan Heights and the West Bank, including East Jerusalem, on February 12, 2020. Due to its subsidiary General Mills Israel’s operations in Israeli settlements in these occupied regions, which some have said violate international law, General Mills was included to the database.
