By Rene Nah, McMaster University
January 10, 2022
According to Insider.com, it takes 400 cocoa beans to produce only one pound of chocolate, or ten Hershey chocolate bars. Considering one cocoa tree produces up to three pounds of cocoa, back-breaking labour and long hours are required for harvest. In 2019, a bittersweet milestone occurred resulting in the largest production of cocoa at 4.85 metric tons. Cote d’Ivoire accounted for 2.12 metric tons of that harvest. The labour required to achieve such numbers resulted in over 1.5 million children being trafficked and forced to work in the cocoa industry.
A recent article from Independent exposed child slavery and human trafficking in the supply chains of seven of the largest cocoa firms: Nestle, Olam, Mars, Mondelez, Cargill, Barry Callebeut, and Hershey.
How could firms with commitments to anti-slavery and supplier transparency get caught up in such allegations? Why promise to address and correct issues of modern slavery, but step back from allegations and claim “we are no different from the customer” when it comes to buying chocolate from suppliers? In short, the lack of effective governance and accountability has enabled firms to separate themselves from the trafficking and slavery in their supply chains.
According to Anti-Slavery International , modern slavery can take the form of child labour, forced labour, and human trafficking. Eight Malian citizens and former cocoa farm workers have brought a lawsuit against the chocolate manufactures claiming that they were recruited at the age of 16 then trafficked to plantations in Cote d’Ivoire to work in poor conditions, suffering insect bites and machete wounds, for low pay, and with long hours. Without proper travel or work documents, they were put in an extremely precarious position and their wages were withheld. Coercion and deception are common tactics trafficking agents may use to recruit children into the plantations.
Cote d’Ivoire supplies a significant portion of the world’s cocoa supply, approximately 40% according to Insider.com and Independent. The industry utilizes forced child labour to keep up with the high demand of harvest and to keep prices low. The Independent reported that there are just over 1.5 million children working on cocoa plantations throughout the Ivory Coast and Ghana, which are the two main cocoa-producing countries in the world.
The Legality of Corporations and US Regulation
US legislation enforces a “should have known” negligence standard under the Trafficking Victims Protection Reauthorization Act (TVPRA) of 2017. Firms utilize corporate social responsibility (CSR) initiatives to demonstrate that they are diligent about eradicating modern slavery in their supply chains, but the nature of global supply chains and corporate law creates a gap between the firm and suppliers.
John Ruggie, the author of the UN Guiding Principles on the Human Rights of Business, noted that the legal structure of global supply chains allows parent firms to remain as a separate entity from suppliers and subsidiaries (1). This separation plays a significant role in allowing firms to shirk responsibility and accountability away from them, thus enabling modern slavery.
The actions of subsidiaries and suppliers that are part of global supply chains are not connected to the lead corporation, in this case, Hershey, Nestle or Olam for the purpose of human rights violation. But if they are not responsible for the actions of indirect suppliers in their supply chain, who is? This lack of accountability allows for lead firms to exploit workers from supplying countries.
Olam's Cocoa Compass and Nestle's Cocoa Plan are examples of CSR initiatives that focus on sustainable farming and aim to address modern slavery in their supply chains. Olam and Nestle explicitly acknowledge their awareness of child slavery and poor working conditions while committing to bettering the lives of farmers through fair or living wages.
Trendy topics like “detectability” or “traceability” are used to show consumers that their cocoa is 100% traceable, but here is the hitch: these only apply to directly-sourced suppliers. The choice of self-governance and compliance to their own CSRs are therefore biased. They can pick and choose which issues are most important to them, and they can choose which NGOs to partner with.
Olam’s Cocoa Compass
Launched in 2019, Olam’s Cocoa Compass aims to improve the future of the cocoa industry. Goals for sustainability, reforestation in Ghana and Cote d’Ivoire, educating farming families, and supporting the livelihood of farmers were mapped out over their ten-year plan. Child labour being directly managed in programs, and 100% monitored, was a successfully completed target for 2020, according to the Cocoa Compass Impact Report of 2019-2020. These small victories illustrate the effort Olam is putting in their commitment to better their role as producers in the industry. But the question of governance remains as the lawsuit launched by the Mali workers reveals.
The problem is that Olam’s anti-slavery commitment strives to eliminate slavery only in direct suppliers. But with large supply chains, direct suppliers outsource into webs of informal networks supplied by third parties. In the case of the Mali workers, they were trafficked into work by a third-party agent that directly or indirectly supplies to Olam. Thus, it is a weak promise to only focus on direct suppliers.
AtSource is an insights platform created, funded, and published by Olam. It allows consumers to track and monitor not only Olam’s supply chain, but other supply chains in the agricultural sector. Metrics on slavery, traceability, and progress on goals are available through the platform. Olam’s unilateral control over this app can show false positive progress in mitigating and ridding modern slavery from their supply chains. The metrics picked and used by Olam can inflate their contribution to regulating the cocoa industry by creating a favourable self-representation. Through these self-governing policies and the creation of platforms to increase transparency between consumers and Olam, modern slavery in corporate supply chains risks being minimized.
Modern slavery in the cocoa industry remains at the forefront of social issues for firms, especially for the seven largest currently operating internationally. The allegations brought forward by trafficked Malian workers shines a light on the weak governance policies that exist in the cocoa supply chain. Unfortunately, the conditions of modern slavery experienced by children trafficked from Mali to the Ivory Coast are not unique. Poor working conditions, lack of safety and protection on the job, and exploitation are just the tip of the iceberg these workers endure.
Are CSRs and commitments to sustainability enough to keep large cocoa firms free of responsibility? Is acknowledgement enough to show consumers they care about modern slavery?
Each firm involved in the lawsuit showcased their sustainability plans, proving their knowledge of modern slavery in the industry. TVPRA holds firms accountable for negligence via the “should have known” doctrine, uncovering the prevalence of human trafficking both directly and indirectly along the supply chain. But , the deeper question is, does the nature and structure of global supply chains cocoon lead firms from liability and accountability?
(1) Ruggie, J. G. (2014). The Global Forum. Global Governance, 20, 5-17.
This project is supported by the LIUNA Enrico Henry Mancinelli Professor in Global Labour Issues at McMaster University, held by Judy Fudge, and by funding from the Social Sciences and Humanities Research Council.