CONSTELLATION'S VALUES AND CULTURE

THE AUTHOR AT THE GATE OF JOHN REYNJELL'S VINEYARD, NOW DESTROYED BY CONSTELLATION AFTER 161 YEARS OF FINE WINE PRODUCTION.

The Big C Pulls One Out
Constellation Refines Its Strategy
Premiumising Philanthropy
by PHILIP WHITE ... This first appeared in The Adelaide Independent

“In fiscal 2009, we made significant progress toward premiumizing our portfolio and saw the early benefits of this effort.”

The premiumizer is Richard Sands, Chairman of Constellation Brands, the world’s biggest wine company, owner of what was Hardy’s. His brother Rob is CEO. Their headquarters are in Victor, New York.

Part of this premiumizing directly affects many aspects of South Australian life, in line with the Sand’s brothers “refined strategy”, which has the bold goal “to elevate life with every glass raised” and to “make a positive difference in the communities in which we live and work”.

In the late eighties Mike von Berg, one in a long chain of colourful PR flaks, summoned the Australian wine press to Hardy’s new headquarters at Reynella. He lined us up, clicked his heels, and told us our attitudes to the bulk wine market were far too negative. No longer would flagons be called, well flagons. “We’re relaunching them”, he said with a grin. “They will now be known as Jolly Jugs.” The new Jolly Jug was a flatter flagon that would fit in the door of a fridge.

Like von Berg, the Jolly Jug very quickly disappeared into oblivion. But it’s the same old same old at Constellation. The grand old Hardys Nottage Hill brand has been granted bladder pack status for the first time, and is selling in the huge UK liquor chain, Sainsbury’s, in Freshcase, a 2.25-litre bladder pack with the tap built flat into the base. It can be stored horizontally in the fridge, and one can fill a glass without removing the whole pack. Sainsbury’s hails this as “one of the most exciting packaging innovations in wine that we have ever seen ... offering real benefits to the consumer in keeping premium wine fresh for longer in a convenient pack”. Premiumizing, see.

Constellation’s PR troops have been working very hard on their premiumizing. They’ve now “defined three areas in which all of its Corporate Social Responsibility focus will take place: sustainable business practices, philanthropy and social responsibility. From these three focus areas flow specific categories of emphasis, including our environmental impact, corporate giving, marketing and advertising codes, community involvement and much more. All of Constellation's social responsibility efforts flow directly from its values and culture.”

Values and culture, eh? The terrible reality is too much of this business depends entirely upon a sick Aussie dollar, an eternal oversupply of grapes and cheap water to pump them up, and a market that will drink everything you can tip into it. And all that’s dependent on the discount bins of the Old World, where profit barely exists. Given all that, Constellation appears to be marching backwards out of Australia.

It’s closing its eleven year old, $20 million Stonehaven Winery at Padthaway because it can’t find a buyer. It has closed its brand new Leasingham winery at Clare. The brands will remain, but they’ll be virtual, now being glued on wines made at Reynella, Tintara or Berri. Constellation has eight other regional wineries for sale around Australia, and has managed to sell only seven of the 23 vineyards it no longer wants: 175ha of vines in Padthaway and Clare are being pulled, so the properties can be sold as farmland.

In recent months, Peter Dawson, the chief winemaker, was sacked. John Grant the CEO soon followed. Even the revered environmental scientist who ran Banrock Station, Tony Sharley, has had the chop. Banrock, by the way, has just released a suite of wines called The Mediterranean Collection. These “Mediterranean” wines are grown at Banrock and made at Berri, which shows incredible sensitivity to the notion of honest labelling and terroir.

The cruellest metaphor for this whole bloody mess is the recent removal of John Reynell’s 161 year old vineyard opposite his elegant colonial cottage at Reynella. Constellation hired an historian who found that this vineyard was unduly respected, because generations of PR people had overblown its historical importance in order to sell more wine at a higher price. This information led the Onkaparinga Council to approve the destruction of the vineyard in spite of a heritage listing on the entire Reynella site. It will be replaced by 41 tiny apartments.

This leaves the door open for another team of PR flaks to take the blame should another manager decide to sub-divide the much bigger heritage-listed vineyards to the west and south of the enormous Reynella winery. If a historian could be found to contradict the first one, as I most fiercely do, it would be easy to admit to a terrible mistake, thereby show that the important vineyard was indeed the one now removed, leaving the greater vineyard with no valuable history, but an enormous value as housing land. Watch that space!

CONSTELLATION'S HISTORIC CHATEAU REYNELLA. JOHN REYNELL'S FAMOUS CABERNET MALBEC VINEYARD, CIRCLED AT LEFT, ORIGINALLY PLNATED 161 YEARS AGO, HAS BEEN UPROOTED TO MAKE WAY FOR A YUPPIE GHETTO. ,

Brazen backflips are not new in Constellation’s community involvement. Until recently, it flogged its USA kiddylikker, Wide Eye Schnapps, a potent mixture of caffeine and alcohol, with the promise that “consumers who drink Wide Eye will remain alert when consuming alcohol.” The social responsibility came into play when Constellation suddenly agreed with the Federal Trade Commission ’s ruling that their marketing “was deceptive, unsubstantiated, and in violation of federal law”.

Like John Reynell’s 161 year old vineyard, that one got pulled, too.



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The Ngarrindjeri Curse

by PHILIP WHITE - this was published in The Independent Weekly in August 2008

“What does this mean for the image of the wine industry?” asked Tony McCarthy. The Baldies had woken me to discuss the continuing retreat of Constellation, the world’s biggest wine company, from South Australia. I didn’t really answer his question.

Constellation, which managed to absorb Hardy’s, which had absorbed Chateau Reynella before being absorbed by the big Riverland duet, Berri-Renmano, knows more than most the true value of green bucks.

These are the guys, remember, with the wetlands.

Banrock Station is a perfect example of how you use salty irrigation water on arid land to grow vines which produce little bags of sugar, from which you can legally make alcohol, which brings sufficient profits to fund a swamp along the river from which your humungous pumps took the water for the vineyard. Until it all goes cactus and you put your hand out to the government to help you keep it all looking tickety-boo for a little longer. Which can also be sold as a good news yarn for all concerned. Once or twice.

This is about tweaking the image of the true nature of your business. Green bucks. When John Grant, the President, yep, President, of Constellation Wines Australia, sent out his triumphant press release about how his winery closures and vineyard sales was a deft response “to the difficult global environment by taking steps designed to benefit the company over the long term and, by so doing, help strengthen Australia’s wine sector”, he mentioned the environment, but not Banrock Station. This is because the River is on the nose, but not yet sufficiently stinky to sacrifice Banrock, which might come in handy if the Murray gets better.

“World’s Biggest Wine Company Heals Aussie River”… I can hear it. “We’ll blame this hiccup on the Ngarrindjeri Curse: the disturbed dead of Ngurunderi taking their revenge. Storm Boy has prostrate cancer; old Gulpilil’s pissed in the cane grass; white man’s firewater saves sick river … just a touch more oboe behind the baby ducks, please Boris...”

But image-wise, internationally, the Murray, and its estuary, is quickly becoming our equivalent of the Amazon Basin. A posh pleasure industry based on the totally unnecessary luxury commodity, wine, doesn’t want to be associated with destroying the Amazon Basin. But that’s what it’s done.

In the same news bulletins that reported the Constellation retreat, Dean Brown was on, spraying big time about how us citizens don’t appreciate the hard work Mike Rann and Karlene Maywald are putting into the River. The Brown Man can flush red and lecture, believe me. But suddenly he was doing it for Robin and Catwoman.

Not long ago it was Premier Brown arranging some water rights for his mates in the wine biz who saw Langhorne Creek as a little Coonawarra conveniently close to Adelaide. The vineyards increased from 471 hectares to 4700 within a few years, and now there’s no water and many tears. This sudden lapse coincides with Mr. Brown becoming Mike Rann’s Droughtmeister, not to mention Chairman of Hillgrove, the miner who’s about to dig the biggest pit this side of Roxby at Kanmantoo.

But open pits are thirsty. No worries. Fill the sails of Mount Barker Council and The Courier with bumptious self-congratulatory bullshit about the mining boom being good for the Hills, thus justifying the construction of another one or two thousand villas to house all the lucky employees.

This presents a crisis: what are we gonna do with all this grey water this new Tupperware Tuscany has produced? Easy. Put in a nice little wetland to keep the kiddies and the greens happy with a few shags, coots and ducklings, and flog the overflow to the mine. An environmental triumph matched only by Banrock!

But this is where Dino becomes the Joker: riparian rights. Any effluent from Mount Barker should flow straight to Langhorne Creek, which has no water in the Brown pipes. This may help replace the water they took out of the river a little upstream to supply Mount Barker’s Villa Rash/Greywater Factory so they can fill the kiddies’ wetlands and keep the miners happy. Whew!

The hubris of prospective winegrape investors is similarly malignant: they’re doing soil tests at Langhorne Creek for new big plantings. Now. These, no doubt, intend to take water from one of the private pipes being run past the forthcoming Wellington Weir to catch the last drops of fresh water that managed to get past the Mount Barker pipe. Just think. A few years back it would have run down there to Langhorne Creek, through the Lake, all by itself.

I know many of you think this column should be about wine. But Thirst is thirst, and water is an important gastronomic item. Constellation knows Adelaide is approaching the point where it must choose whether it wants water or wine. The whole world is watching.