You can't rewrite history, and Monsanto's (NYSE:MON) storied past is littered with less than reputable tales of controversial chemicals gone wrong, along with more recently disputed concerns over genetically modified organisms (GMOs) and the business practices used to spread GMO seeds into mainstream agriculture. At the same time, it is unfair to judge a company based entirely on past practices, and efforts made by Monsanto to become a more socially admirable company should be recognized.
Will Monsanto ever be able to change its reputation as a morally decrepit organization? And, equally important, does it need to?
A long list of evils
Monsanto is constantly berated for its history of developing revolutionary but controversial products. From its manufacturing of DDT and Agent Orange to its more recent development of Roundup and genetically engineered seeds, Monsanto has established a less-than-pleasant reputation as a company that the public loves to hate.
Chemical companies in general are good targets for citizen angst -- by their nature they need to develop new technologies, and some inevitably will turn out with side effects. DuPont (NYSE:DD) and Dow Chemical (NYSE:DOW) have many of the same opponents as Monsanto, and for similar reasons. These companies develop and have developed technologies that, in spite of all of the good intentions, ended up with negative side effects. These companies may be far from innocent of all of the accusations made against them, but despite the most discouraging parts of Monsanto's history being well known, there are more reputable business practices by Monsanto that go unrecognized.
Some good to be found
Anybody who has lived with or seen first-hand the effects of Agent Orange may forever be unforgiving of Monsanto, Dow Chemical, or the U.S. government. Nonetheless, numerous technologies developed by Monsanto have made the world a better place, and the company has been well recognized as a leader in corporate and workplace behavior.
Alongside the development of Roundup-resistant GMOs, Monsanto is investing significant resources to develop drought-resistant crops and other seeds with traits needed to grow food crops in challenging, food-poor regions of the world. Chemicals developed by the company have included drugs used to treat Parkinson's Disease and arthritis, as well as mass-produced LEDs and indispensable industrial chemicals.
Consumer treatment may be suspect, but Monsanto treats its employees well. The company has been often recognized for its company diversity and corporate equality, and it has ranked high on several 'best companies to work for' and 'top employer' lists from top business publications.
People are scared of science, and they are scared of change. When science is the reason for change, it creates a whole new level of paranoia.
America's major chemical companies are deserving of severe criticism for the creation and marketing of chemicals with negative effects to both humans and the environment. Based on a sketchy past, consumers are right to be skeptical of the more recent technologies introduced by Monsanto, namely GMOs. However, a mishandling of past chemical development processes does not automatically make Monsanto and GMOs guilty in the same manner as does the government-supported and encouraged production of DDT and Agent Orange.
When the past, present, and future are all taken into consideration, investors may be taking a risk when investing in controversial companies due to the fear of a widespread consumer response. However, Monsanto and its peers in the industry have weathered a lot of negative feedback in the past and have survived and even thrived in spite of it.
Like it or not, Monsanto will be around for a long time to come. Maybe it will use the next fifty years to repair a broken reputation.