Corporate Governance @ Production(GMOs- BT Cotton in India)

 

Genetic modification, also called genetic engineering, is the process of changing the DNA of an organism, such as a bacterium or plant or animal. These changes can be as small as inserting or deleting a few DNA ‘letters’ in the organism’s genome (its complete set of DNA) to adding a new gene from a different species. Genetic modification is not the same as cloning. Cloning creates an exact copy of all or part of an organism’s DNA, while genetic modification makes changes to existing DNA to create a new, modified version of the genome.

No corporate activity today is more controversial than the production and sale of genetically modified organisms (GMOs); another common abbreviation is GM for genetically modified foods). One company in particular, Monsanto, USA has become so closely associated with GMOs that it has become the target of worldwide criticism and a number of public protests.

In 2011, the percentage of GMOs in world production stood at 83% for cotton, 75% for soya beans, 32% for corn and 26% for rapeseed. This production is the preserve of 29 countries, mainly the United States, Brazil, Argentina, India and Canada. Meanwhile, cultivation of GMOs remains forbidden in over thirty nations.

The most widely used genetically modified animals are laboratory animals, such as the fruitfly (Drosophila) and mice. Genetically engineered animals enable scientists to gain an insight into basic biological animals like cows, goats and sheep have been genetically engineered processes and the relationships between mutations and disease.

Farm animals, such as sheep, goats and cows, can also be genetically modified to enhance specific characteristics. Milk production and disease resistance, as well as improving the nutritional value of the products they are farmed for. For example, cows, goats and sheep have been genetically engineered to express specific proteins in their milk.

GM crops were first introduced in the USA in 1994 with the Flavr Savr tomato, which had been genetically modified to slow its ripening process, delaying softening and rotting. 

Bacillus thuringiensis (Bt) crops

Plants genetically engineered (modified) to contain the endospore (or crystal) toxins of the bacterium. Bt Cotton: Engineered variety resistant to bollworms, a common cotton pest; it was created by modifying the cotton plant’s genome to include a gene that produces toxins harmful to the pests. In 1995, the Environmental Protection Agency (EPA) in USA approved the commercial production and distribution of the Bt crops: corn, cotton, potato, and tobacco. Currently, the most common Bt crops are corn and cotton.

The crystal, referred to as Cry toxins, is proteins formed during sporulation of some Bt strains and aggregate to form crystals. Such Cry toxins are toxic to specific species of insects belongs to orders: Lepidoptera, Coleoptera, Hymenoptera, Diptera, and Nematoda. In 2016, the total world area cultivated with genetically modified crops (GM crops) reached about 185 million ha.

BT Cotton in India

In India, the Bt acreage was only 3.4% of the total cotton area in 2003. However the increase in yield in 2003-2004 was 61% so it is not sufficient to credit the Bt. cotton for that. Similarly Bt coverage by 2005 was only 15.7 but increase in yield increases were over 90% over 2002 levels. While Bt cotton adoption corresponded to a drop in spraying for bollworms, the study states, that countrywide yields stagnated after 2007 even as more farmers began to grow Bt. By 2018, yields were lower than in the years of rapid Bt adoption

According to data from the the Union Ministry of Agriculture, the adoption of Bt cotton in India has increased the production of cotton to 34.89 million bales in 2017-18 from 8.62 million bales in 2002-03.

The government has wrongly submitted to the Supreme Court and the Union Ministry of Agriculture have erroneously claimed in Parliament that Bt cotton is an ‘outstanding success’, said environmental acvtivists Aruna Rodrigues and Vandana Shiva, at a press conference on September 6, 2019.

While yield in terms of kilogram/hectare is the true performance evaluator for Bt Cotton, the government has taken wrong data — the total national cotton production data, the activists said. 

 German chemical and pharma major Bayer AG on June07, 2018 announced completion of the $63 billion mega-deal (2016) to acquire US-based biotech major Monsanto to create the world’s biggest agro-chemical and seed company

 

New Delhi approved the first GM cotton seed trait in 2003 and an upgraded variety in 2006, helping transform India into the world's top producer and second-largest exporter of the fibre. Monsanto's GM cotton seed technology went on to dominate 90% of India's cotton acreage. Nuziveedu Seeds Ltd (NSL), which produces GM cotton seeds, stopped paying royalties to Monsanto in 2015, arguing that Indian law did not grant Monsanto patent protection for the seeds. The companies have been entangled in litigation ever since. Mahyco Monsanto Biotech (India) (MMB), a joint venture between Monsanto and India's Maharashtra Hybrid Seeds Co (Mahyco) had been at loggerheads with the NSL and the Indian government over how much it could charge for its genetically modified cotton seeds. Bayer AG said on Friday it had reached an "amicable settlement" in its Monsanto unit's long-running intellectual property dispute with Indian seed maker Nuziveedu Seeds Ltd (NSL) over genetically modified cotton seeds. In a statement to Reuters on March 26, 2021, the German company said it had resolved "outstanding issues and differences" over the dispute, giving no further details. Two sources familiar with the matter said the companies had reached a legal settlement that would end all ongoing litigation.

 

 BT Cotton - world scenario

According the Food and Agriculture Organization of the United Nations, there are 795 million people (more than 10% of the world population) who are chronically undernourished. This includes 161 million children, of which 3.1 million die from hunger each year.

Insulin used in medicine is an example of genetic engineering. Genes encoding human insulin were cloned and expressed in E. coli in 1978. At present, insulin is being produced in E.coli and the yeast Saccharomyces cerevisiae for diabetic patients (Baeshen et al. 2014).

 

In most cases, farmers who use GMO technologies do so to increase productivity, either by increasing production yields (minimising pest-related losses), or financial returns (reducing labour or the use of specific phytosanitary products). In 2014, an analysis of 147 studies carried out around the world over the previous 20 years stated that “on average, GM technology adoption has reduced chemical pesticide use by 37%, increased crop yields by 22%, and increased farmer profits by 68%” (Klumper, 2014).

In 2015, a majority of European Union countries decided to block the cultivation of eight new types of GMO pending new data and approval from regulatory bodies. Nonetheless, the European Union remains the greatest user of GMOs: 30 million tonnes of genetically modified soya beans and corn are required for animal feed every year.

In 2015, GM crops were grown in 28 countries and on 179.7 million hectares – that is over 10% of the world’s arable land and equivalent to seven times the land area of the UK. The USA, Brazil and Argentina are the leading producers. There are currently no GM crops being grown commercially in the UK although scientists are carrying out controlled trials.

Questions

 

1.     Is it ethical to genetically modify farm animals/plants  for any purpose? Substantiate your answer.

2.    GMOs poses threats to environment and so not to be allowed. Do you agree? Substantiate your argument

3.     Healthy Food for humans necessitates the need for protection against diseases and pests that are harmful to his needs. Quality & Quantity matter in the market. Analyse from the Business Ethics angle and comment.

4.   What Corporate Governance could be observed by companies engaged in production and marketing of GM products?

 

References

1.       https://dolly.roslin.ed.ac.uk/facts/gm-faqs/index.html

 

2.     https://climatescience.org/advanced-food-gmo/?gclid=CjwKCAjwr_uCBhAFEiwAX8YJgdulHD9L6Wqd_Mu8Rcqfvdi951FR0Yk0yHpNoFTg4BKG767hiCz6ORoCxvIQAvD_BwE

3.       https://milnepublishing.geneseo.edu/good-corporation-bad-corporation/chapter/4-genetically-modified-organisms-gmos/

4.       https://www.drishtiias.com/daily-updates/daily-news-editorials/impacts-of-bt-cotton

5.       https://www.downtoearth.org.in/news/agriculture/wrong-to-say-bt-cotton-successful-in-india-environmental-activists-66604

6.       https://www.thehindubusinessline.com/news/world/bayer-completes-acquisition-of-monsanto/article24105139.ece

7.       https://www.livemint.com/companies/news/bayers-monsanto-india-s-nsl-settle-long-running-gm-cotton-seed-dispute-11616775152678.html

8.       https://www.alimentarium.org/en/knowledge/benefits-and-risks-gmos?gclid=CjwKCAjwr_uCBhAFEiwAX8YJgdfAMMikllDOCNqQbuyboDnbPnsuZzrWJHxbu70NwLxYcQfZkneFXRoCc0QQAvD_BwE

9.       https://royalsociety.org/topics-policy/projects/gm-plants/what-gm-crops-are-currently-being-grown-and-where/