The chairman of Coles has expressed disappointment that Australia’s cost of living crisis has been “politicised” to wrongly identify supermarket giants as the villains behind inflation and rising prices.
James Graham made the controversial comments while addressing Coles shareholders at its annual general meeting in Melbourne on Tuesday.
He sparked outrage by claiming supermarkets were unfairly targeted and blamed for the crisis.
“We have always been sensitive to the impact of the economic climate on households and in this context it has been disappointing to see cost of living concerns being politicized and directed at supermarkets,” Mr Graham told shareholders.
“This is in stark contrast to the cooperative approach we saw from governments and regulators during the Covid-19 lockdowns.”
Graham said the “results of working together” in the face of natural disasters show the “benefits of constructive engagement between businesses and governments.”
He argued that such cooperation should be the “model for the future when it comes to addressing the impacts of complex issues such as inflation.”
Rising prices at the checkout have prompted Anthony Albanese’s government to ask the watchdog, the Australian Competition and Consumer Commission (ACCC) investigate whether Coles and its main rival, Woolworths, abuse their market power.
Coles chairman James Graham sparked controversy when he addressed shareholders at its annual general meeting on Tuesday.
This led to legal action against the supermarket giants for allegedly breaching consumer law with misleading discount price claims.
The ACCC said the duopoly would briefly increase product prices by 15 per cent, before lowering them below the peak but above the starting price.
Graham promised Coles will continue to do “the right thing” by cooperating with authorities’ investigations.
‘We are very aware of the importance of these accusations. “They go to the heart of customer trust,” he said.
However, he indicated that they were a secondary issue and that inflation had more important causes.
“I think there has been a broader ambition on the part of some behind those investigations to try to provide answers to more difficult questions that have arisen, as I mentioned, from inflation,” Mr Graham said.
The Coles chairman said price increases in Australian supermarkets were favorable compared to those overseas.
He claimed that suppliers had requested price increases due to general inflation and that the supermarket had run promotions on those prices.
“The subsequent discounts offered to customers on these items were the result of promotional investment by the supplier and Coles, resulting in a reduction in the selling price at a time when households were under significant cost of living pressure “Graham said.
Pointing to the With the ACCC’s recent findings showing a 24 per cent rise in the cost of a basket of food and non-alcoholic drinks in the five years to June 2024, Graham said that figure compares well internationally.
He said they were less due to price increases seen over the same period in comparable countries such as New Zealand, the United Kingdom, Canada and the United States.
However, at least one shareholder was unconvinced, telling Graham she was “really concerned about the reputational damage” Coles had suffered last year.
“We are fully aligned in terms of the importance of trust and sustainability with all stakeholders, so that we can generate long-term value for shareholders,” he responded.
“The two go hand in hand.”
A government watchdog has accused Coles of being misleading in its promotion of special offers and allegedly undercutting prices.
Daily Mail Australia has contacted Coles for comment.
It comes as Coles boss Leah Weckert acknowledged Australians’ problems in her speech to shareholders.
“We know the current cost of living environment is difficult for Australians, particularly as rising household costs make it more difficult to balance the family budget,” he said.
‘This means our commitment to delivering value has never been more important. With this in mind, we have made significant investments in our value offering over the last 12 months.
A Roy Morgan survey earlier this year found Coles had fallen 221 places from Australia’s fourth most trusted brand to one of the country’s most distrusted brands in just a few months.
Coles posted a rise in grocery revenue last year, which saw its net profit rise to $1.1 billion.