Loblaw to Sign Grocery Code of Conduct Agreement

Loblaw Cos. Ltd. announced on May 16 that it is prepared to sign the grocery code of conduct, marking the culmination of years of negotiations.

After six months of talks, Loblaw’s president and CEO Per Bank stated that the retailer is now willing to sign, contingent on other industry participants doing the same.

Bank affirmed, “The code is now equitable and will not result in higher prices.”

Developed by a consortium of food industry leaders, the code aims to level the playing field for suppliers and smaller retailers.

Concerns arose last December when Loblaw and Walmart Canada initially declined to sign the voluntary code citing potential price increases for consumers.

Nick Henn, Loblaw’s chief legal officer, indicated that the core principles of the code remain unchanged.

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In an interview, Henn clarified that efforts were made to enhance and clarify the code, particularly in areas such as the dispute resolution process.

He highlighted that under the revised code, concerns about price negotiations between suppliers and retailers have been addressed, allaying fears of price hikes.

The code is slated to take effect on June 1, 2025.

Michael Graydon, CEO of the Food, Health & Consumer Products of Canada association and chair of the interim board for the code, expressed satisfaction with the progress.

Addressing the ongoing negotiations with other major grocers, Graydon emphasized the need for collaboration to ensure all stakeholders align with the code’s principles.

Walmart Canada is currently reviewing the revised Grocery Code of Conduct and considering its next steps, as per spokeswoman Sarah Kennedy.

Empire and Grocer Metro Inc. both reiterated their support for the code, emphasizing the importance of broad participation for its success.

Reflecting on Loblaw joining the initiative, Gary Sands from the Canadian Federation of Independent Grocers sees it as a significant development.

As calls for mandatory enforcement of the code grow amidst rising food prices, Loblaw’s cautious optimism for an agreement is shared by federal ministers and industry stakeholders.

Despite ongoing scrutiny and organized boycotts of Loblaw, Bank remains committed to reaching an agreement on the code and addressing industry-wide challenges.