Thursday, October 18, 2012

Chocolate is Sexy...

Now that I have your attention…

At a conference next week, I will attend a presentation by a major chocolate producer regarding sustainable global supply networks. In preparation, I thought I'd gather my thoughts and some recent reports about major cocoa sourcing issues:

In September 2001, the Harkin-Engel Cocoa Protocol, designed to eradicate child labor from cocoa fields supplying chocolate manufacturers, was signed in to law. During the past eleven years, the terms of the Harkin-Engel Cocoa Protocol have been watered down substantially and many of those terms that remain still have not been met by the major chocolate manufacturers. About 75% of the world’s cocoa is grown in West Africa, mostly the Ivory Coast, on small farms. Hundreds of thousands of children continue to work in cocoa fields, many harvesting cocoa beans using machetes, considered one of the worst forms of child labor by the UN due to potential injury.

In case you missed them, the CNN Freedom Project put together a fantastic series of investigative reports about child labor in the cocoa supply chain. Check them out for a fairly authentic picture of conditions for children working on cocoa farms and some insight as to why the issue is so pervasive in the Ivory Coast, specifically. This link will take you to their first report.

The following major chocolate manufacturers took significant steps this year toward meeting their obligations under the Harkin-Engel Cocoa Protocol, with a new 2020 target date.

Mondelez (Cadbury & Milka combined global market share 15.2%*)
Mondelez is the newly spun-off snack foods division (as of October 2, 2012), formerly part of Kraft, which includes chocolate products under the Cadbury label. Mondelez is the only major chocolate manufacturer that has not made a sustainable cocoa sourcing pledge. Since 2008, Cadbury has committed approximately $70 million to a Cocoa Partnership devoted to improving farming practices at source farms in Ghana, India, Indonesia, and the Caribbean. The program does not include farming operations in Ivory Coast, which Kraft claims were included in a separate initiative working in cooperation with the Ivorian government. Although Kraft, now Mondelez, claims they are the largest purchaser of certified cocoa, the amount relative to total cocoa purchasing is unclear and estimated at about 11%.

Mars (global market share 14.6%*)
Mars joined the pledge to end child slavery [FR] in their cocoa farming supply chain by 2020, along with the Nestle, Hershey, and other major global manufacturers. With a target of more than 20% certified cocoa purchases (about 90,000 metric tons) during 2012, Mars will become the largest user of certified cocoa in the world.

Nestlé (global market share 12.6%*)
During early 2012 Nestlé signed on with the Fair Labor Association (FLA) and the first project examined labor conditions in Nestlé’s cocoa supply chain in the Ivory Coast. The FLA report determined child labor exists pervasively within cocoa production in the Ivory Coast (and other African nations). In response, Nestlé developed a Cocoa Plan which includes revising their supplier code of conduct to specifically address sustainable methods for eradicating child labor from cocoa farming. The FLA will monitor progress toward goals set within the plan.

On a related note, Nestlé sponsored the September 2012 CSV (Creating Shared Value) forum “The Role of Business in Food Security and Nutrition.” Presentations and other content may be accessed through free registration.

Hershey (global market share 6.7%*)
Hershey is the latest to commit to eradicating child labor in their cocoa supply chain by 2020. This announcement can be interpreted as the result of successful targeted consumer campaigns. In August, a group of privately-owned grocers expressed concern about carrying high-end Hershey products, due to the company’s lack of responsiveness on the topic of child labor in West Africa cocoa farming. Then, in early October, the Whole Foods chain of grocery markets declared they would stop carrying the same high-end Hershey labels in response to customer complaints about Hershey’s refusal to address child labor. In addition to initiatives targeted toward moving children from cocoa fields in to schools, Hershey’s plans to expand Cocoa Link and Learn to Grow programs. These programs are designed to increase cocoa farming yields through teaching sustainable farming practices.

The above is merely background and current status of major chocolate manufacturers directly pertaining to the issue of eradicating child labor from the cocoa supply chain. I anticipate I’ll have additional thoughts after the conference.

In addition to those discussed above, I am including links to a couple organizations with targeted campaigns or programs aimed at eradicating child labor from cocoa supply chains in Ivory Coast, Western Africa, and beyond:

* global market share percentages from a January 14, 2010 Bloomberg BusinessWeek report

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