Melted morals?

It is more than ten years since the International Labour Organisation (ILO) reported shocking stories of child slave labour in West African cocoa production. Following intense lobbying by the major confectionery companies to avoid binding legislation that would effectively prohibit such practices, industry initiatives ostensibly designed to eliminate them have proliferated. Companies have argued both that they are unable to do anything about it and that they are doing something about it, whilst missing by far the deadlines for improvements that they voluntarily signed up for. Campaigners allege that little has changed. Consumers, however, are biting back, with more people turning to Fairtrade products or other alternatives to mainstream brands, which have flourished in the intervening years. Some companies have responded by attempting to sweeten their image: Cadbury’s Dairy Milk became a Fairtrade product in the UK in July 2009 whilst Mars has announced that all its chocolate will be Rainforest Alliance certified by 2020. But can we really anticipate a day when the only thing that pricks our conscience about munching a Mars bar is the calorie count?

Children, Chocolate and the Côte d’Ivoire

More than a third of cocoa traded globally comes from the Côte d’Ivoire (Ivory Coast) and 70% of worldwide cocoa production takes place in West Africa.(1) Three massive food companies dominate the chocolate market, accounting for 35.5% of global production: Nestlé, Mars and Hersheys (an American company licensed to produce Cadbury’s chocolate in the USA).(1) Given this market concentration, it would seem a safe assumption that these companies are linked to the human rights abuses which make the industry so notorious, but the complexities of the supply chains make it difficult for anything to stick other than a muddied reputation.

A study conducted in 2002 estimated that of about 284,000 children working in the West African cocoa industry, 200,000 were in the Côte d’Ivoire and a “substantial minority” of these children were found to have been trafficked from Mali, Burkina Faso, and Togo.(2) The same study found that some 10,000 children in the Côte d’Ivoire were victims of human trafficking or enslavement, whilst 109,000 worked under the “worst forms of child labour”. Since these figures were reported, however, it seems that absolute numbers are hard to come by. An Ivoirian government survey conducted in 2007 claimed that “fewer than 2% of children who work in cocoa production are not members of the household.”(3) From this data, which is perhaps questionable, it is difficult to assess how much progress has been made, despite the claims made by the Ivoirian government and the chocolate industry. The US Department of State reported people trafficking, forced labour, forced child labour, and hazardous child labour to have occurred in the country in 2007.(4) In August 2009, an INTERPOL operation resulted in the rescue of 54 children of seven different nationalities that were victims of organised slave labour in cocoa and palm plantations in the Côte d’Ivoire. INTERPOL described the trend in child trafficking and exploitation in the area as ‘increasing’.(5)

The Côte d’Ivoire erupted in violence in 2002 and has been dominated by civil unrest ever since, with the northern part of the country controlled by rebel forces and the south by the government, the army and militia groups. Land rights issues with regard to cocoa farming have fuelled tensions between local indigenous people and internal migrants. Ethnic cleansing and expropriation of the cocoa farms of migrant people became known as the ‘chocolate war’.(6) A 2006 study reported that “hundreds are dying in a cocoa feud... very little is known about the fate of the children who worked on these farms”.(6)

Most of the chocolate produced in West Africa is on smallholdings or family farms, where children have long participated in production. Stop the Traffik argue that forced child labour and human trafficking is “an abuse of this tradition”.(7) Some reports have claimed that children as young as six were made to work 80-100 hours a week, and were beaten and severely malnourished.(8)

The production of cocoa often takes place under conditions dangerous for children. Specific risks include the application of pesticides and fertilisers without protective clothing, leading to chemical burns, allergic reactions, poisoning and long term health effects; using sharp cutting equipment, leading to lacerations and tetanus; felling trees and clearing land by burning, leading to lacerations, snakebites, burns and trapping by falling trees; and carrying heavy loads, leading to neck and backbone ailments, exhaustion, deformities and impairment of normal physical development.(9)

Furthermore, working children often don’t attend school. The 2002 study found that 88% of the child workers surveyed in Côte d’Ivoire had never attended school.(10)

Trafficking, slavery and hazardous working conditions are known as the “worst forms of child labour”, and these are predominantly the issues that industry initiatives claim to address. However, it should be noted that child labour in itself (with some exceptions) is against ILO conventions. In the Côte d’Ivoire, the legal minimum age for agricultural work is 12.(11)

Corporate response

In response to allegations of child labour in chocolate supply chains, two US Senators proposed a bill which would have required chocolate manufacturers to label their products as ‘slave free’. None of the major players in the chocolate market would have been able to make such claims,(12) and lobbied for industry self-regulation. In 2001, the Harkin-Engel Protocol was agreed, named after the two Senators that proposed the bill. This was a voluntary commitment made by companies to introduce a certification programme covering all of West Africa by July 2005. More than four years after the deadline, we are apparently no closer to this goal. According to Stop the Traffik, “There have been some pilot projects, some education co-operation, but little else.”(8)

In 2004, two NGOs attempted to challenge the US Customs Service in the International Trade Court, on the basis that customs rules prohibited the importation of goods produced by forced child labour. However, industry members moved to block the case, and it was dismissed.(13)

Companies claim to be addressing supply chain problems through their membership of industry bodies that work on the issues. In addition, some companies have introduced or plan to introduce forms of certification. A summary of the industry bodies and steps taken by the five largest chocolate companies covered in this report is provided in the box below.

In February 2009, the Bill and Melinda Gates Foundation announced it would pump $23 million into improving the conditions of cocoa production in West Africa.(14) The World Chocolate Foundation (WCF) is the body that was selected to administer these funds. Its members include the very companies that reap the financial benefits of exploitative supply chains. The president of the World Cocoa Foundation said that farmers lack the “practical knowledge and organizational support needed to grow this unique crop profitably and sustainably.”(14) Corporate partners, including Hershey, Kraft Foods and Mars, have pledged $42 million in cash and in-kind donations to the Gates project. The Gates Foundation’s program officer in agricultural development said “As long as companies are abiding by their commitments and putting effort toward ending child labor, we feel satisfied with that.”(14)

Structurally Screwed

Transnational corporations don’t operate in a vacuum. According to the International Labor Rights Fund, the introduction of Structural Adjustment Programmes (SAPs) in the Côte d’Ivoire exacerbated child slave labour on cocoa farms and had a negative impact on the poor more generally.(11) The ILRF argue that prior to its engagement with the International Monetary Fund (IMF) and World Bank, which began in 1989, the Côte d’Ivoire was relatively stable and had the largest economy in the West African Union. It now has one of the lowest Human Development Indices in the world, ranking 166 out of 179 countries in 2006.(19)

In order to qualify for aid and loans from the IMF and World Bank, the Côte d’Ivoire, along with most others in the largely impoverished global South, was made to implement a set of reforms that involved privatisation, the dismantling of protectionist trade policies, reducing state spending on social services and currency devaluation. For the Côte d’Ivoire, this included liberalisation of the cocoa sector, which, amongst other things, removed guaranteed minimum prices for producers.

One of the things that differentiates West African cocoa supply chains from others is that farmers are often isolated and need to travel many kilometres in order to sell their produce. This leaves them vulnerable to traders: somebody that has just carried a heavy sack for a day is going to be reluctant to return home with it, even if the money he or she gets when they meet the trader is lower than the cost of production. With the advent of liberalisation, farmers were suddenly at the mercy of the global market prices but were not educated into the mechanics of price-setting. They needed to find the global market price in London in order to calculate what they should have received. A senior Agriculture Ministry official was reported to have predicted trouble, particularly from “friction between farmers and buyers over farmgate prices”, but training was non-existent or minimal.(11)

Concurrently, SAPs in other parts of the world were pushing countries to produce cash crops for export rather than food for local markets. The result was spectacularly predictable, and occurred across a range of commodities including cocoa: a global increase in supply leading to the market price crashing. This had a devastating effect on the Ivorian economy, as cocoa production and coffee earned 40% of the nation’s Gross Domestic Product (GDP).(20) The incidence and intensity of poverty doubled from 17.8% to 37% of the population between 1988 and 1995.(21) On a farm level, it became difficult for producers to meet the cost of production. Under these conditions, one of the only costs that producers are able to cut is that of labour. According to Global Exchange “the outcome was a downward spiral for labor in the region, and a surge in reports of labor abuses ranging from farmers pulling children out of school to work on family farms to outright child trafficking and slavery.”(22)

In response to the plummeting market price for cocoa, some cocoa-producing countries formed a cartel to attempt to control the price of cocoa beans by restricting their supply. In 2001, four African countries, the Côte d’Ivoire, Ghana, Nigeria, and Cameroon, agreed to destroy 250,000 tons of cocoa beans to raise prices.(23) Surely a sign of the insanity of capitalism.

In August 2006, the Ivorian Prime Minister, Charles Konan Banny, admitted that privatisation of the cocoa sector had been a failure, and that the situation for many of Côte d’Ivoire’s small farmers had worsened: “poorly studied reforms, especially for liberalisation, lead to situations which have the opposite effects of those being sought. That is what we’re seeing.”(24)

Certification schemes

Chocolate is one of the original, flagship Fairtrade products. Since 1998 the estimated UK retail sales of Fairtrade chocolate by value has grown from £1 million to £26.8 million in 2008.(25)

The first product to be certified was Maya Gold bars, produced by Green & Black’s in 1994. The company has since been bought by Cadbury’s, indicating the growth in market share of Fairtrade chocolate products, which the mainstream brands and supermarkets seem keen to muscle into. When asked what would happen if Green & Black’s was sold to a large multinational company prior to the takeover, chief executive William Kendall said “That would be a result... We would make a lot of money for our shareholders and we would plant a very fertile seed in a larger company to carry on the fair trade.”(26) The fact that Cadbury’s has switched Dairy Milk to Fairtrade in the UK and Ireland is perhaps testament to this.

The impact that mainstream brands moving to Fairtrade or other certification schemes will have on the cocoa sector and smaller brands perhaps remains to be seen. Cadbury’s will initially be buying its Fairtrade cocoa from the Kuapa Kokoo co-operative, the suppliers and 45% shareholders of Divine Chocolate. According to a spokesperson from Divine, they wouldn’t have been able to make this move if Divine had not “spent the last ten years working with farmers and building a supply chain which is now of a sufficient capacity and reliability for Cadbury’s to use.”(27)

Most supermarkets now sell Fairtrade certified brands and some also sell own brand Fairtrade chocolate. In 2004, the Co-operative switched its entire own brand chocolate line to Fairtrade, a significant step up from the shops that stock a few lines. One of the concerns of supermarkets stocking a few key Fairtrade products is that people that previously may have gone to independent shops for these products will instead buy them from the major multiples, decreasing the custom for independent shops and the smaller brands that are found only in independents. Essentially, there would be no need for Fairtrade certification if transnational corporations didn’t trade unfairly, so there is some irony behind the small steps taken by the big players. Furthermore, at the current time, switching to Fairtrade cocoa means ceasing to source from the Côte d’Ivoire, as the necessary infrastructure is not currently in place in that country. It could be argued that investing in improving existing supply chains and working towards certifying these would have a bigger impact on the most vulnerable.

A number of other certification schemes also exist. The organic standards include some social criteria, and no organic chocolate is produced in the Côte d’Ivoire, so buying organic chocolate is a fairly safe bet that it will be slave-free. The Rainforest Alliance is a certification body that has got significant backing from the major companies, as shown by their partnerships with Kraft and Mars. Essentially a conservation organisation based in New York, it is funded by the US Agency for International Development and a number of private agencies. The standards do include social criteria but, crucially, they do not include any provisions for minimum prices. According to a Guardian article, the Rainforest Alliance “sets out to provide farmers with economic incentives to stop them destroying their environment.”(28)

In September 2009, Cadbury plc fought off a £10bn takeover bid by Kraft Foods. On our website, Ethical Consumer raised concerns that, should this takeover occur, the movement of Cadbury’s towards Fairtrade certification could be replaced in favour of Rainforest Alliance certification, with a consequent watering down of ethical standards: “we are concerned about the potential this takeover has for an erosion of some of the gains made by ethical consumers. Perhaps one day regulatory authorities looking at mergers and acquisitions will be tasked to consider wider societal impacts when considering approval for major takeovers of this kind”.(29)

The difference between Fairtrade and Rainforest Alliance certification is the topic of some debate. The International Labor Rights Fund claims that, whilst Rainforest Alliance certification should be applauded as an improvement on the Harkin-Engel Protocol, it still does not go far enough, as there are no guarantees that all of the cocoa in a product has been produced without the worst forms of child labour. It notes that only 30% of the content of a coffee product must be certified in order for it to use the Rainforest Alliance label.(30) Proponents of the scheme argue that it results in real improvements in farmers’ livelihoods through improving farming practices, and that most farmers do receive higher prices.(29)

Beefed up bars

An article in the Food Magazine in January 2009 reported on a number of products that contained unexpected animal-derived ingredients, amongst them Mars’ Bounty and Twix bars, said to contain whey produced using animal-derived rennet, which requires “the slaughter of calves to extract stomach enzymes”.(31) The products were not labelled as ‘unsuitable for vegetarians’. In response to a questionnaire from Ethical Consumer returned by Mars in August 2009, it was stated that “From 2008 our leading chocolate products that are suitable for vegetarians in accordance with the Food Standards Agency guidelines have been labelled with the words ‘Suitable for vegetarians’”. These were said to include Mars, Snickers and Galaxy bars.(32) Ethical Consumer usually awards products marketed as suitable for vegetarians with a positive product sustainability mark, but for this Buyers’ Guide this has not been applied and only vegan products have gained an animal welfare point.

Genetic engineering

A Soil Association report published in November 2007 estimated that around 60% of the maize and 30% of the soya in the feed used by dairy and pig farmers is genetically modified.(33) Consequently, companies that did not use organic milk or have other policies for ensuring that the milk used in their products did not come from animals fed genetically modified feed lost half a mark in this category.

Palm oil

Many chocolate products contain palm oil, which has massive environmental and social costs associated with it. Huge areas of rainforest have been deforested to make way for palm oil plantations, and indigenous people are often displaced in the process. The climate impact of rainforest deforestation and the destruction of peatland as a consequence of the production of palm oil is indicated by the fact that Indonesia, one of the biggest suppliers of palm oil (with a terrible track record of human rights abuses) is the world’s third biggest emitter of greenhouse gases, after China and the USA.(34)

In April 2009, Cadbury was forced to back down from its decision to replace cocoa butter with palm oil in its Dairy Milk chocolate bars in New Zealand following public outcry and a boycott campaign at Auckland Zoo, which pulled Cadbury’s products from its shelves. Cadbury New Zealand’s managing director Matthew Oldham said “we got it wrong. Now we’re putting things right as soon as we possibly can, and hope Kiwis will forgive us.”(35) Whether or not the company will apply this new-found environmental awareness to its products around the rest of the globe remains to be seen.

Companies in this Buyer’s Guide that we have found to use palm oil, but which don’t have an effective policy in place to ensure that it has been sustainably produced, have lost marks in the categories of climate change and habitats and resources.

Company profiles

The Mars family own confectionery giant Mars Inc. In 1988 they were listed as the richest family in the United States by Fortune magazine.(36) According to the November 2004 ETC Group report ‘Down on the Farm’, Mars Inc had patented nanoparticle-based food additives.(37) The company website states that subsidiaries of Mars “conduct limited animal research”.(38) Mars provided ingredients for, and two of it employees were named authors of, a lethal study involving mice.(39)

Nestlé has been criticised around the world for its corporate malpractice. It has been linked to the murders of trade union activists by paramilitaries in Colombia and is apparently the UK’s most boycotted company. Baby Milk Action are running a boycott of Nestlé for its irresponsible marketing of formula baby milk around the world. Nestlé owns 30% of L’Oréal, which has a boycott call against it for animal testing, called by Naturewatch. According to research conducted by the BUAV, Nestlé performs animal testing of food ingredients and related medical-dietary issues, including infant formulations.(40)

Divine is partially owned by the farmers that produce the cocoa in Ghana, giving them “a share in the wealth they have helped create”(32) and a say in how the company is run. The Body Shop was an investor in Divine prior to its takeover by L’Oréal in 2006, at which stage it donated its shares to the farmers co-operative, Kuapa Kokoo, bringing their share of the company to 45%.

Tesco has a boycott call by CASPIAN (Consumers Against Supermarket Privacy Invasion and Numbering) for its use of Radio Frequency Identification spychips on products.

Kraft Foods Inc is the world’s second biggest food company, with annual revenues of $42 billion.(41) Kraft Foods Global, Inc has recently funded lethal research on rats.(42)

Do one thing

Stop the Traffik invites you to organise your own chocolate fondue party, to “Celebrate a mutual love for chocolate while... calling for the end of child trafficking labour in the manufacture of our chocolate”. Resources, including invites, recipes, games and information flyers are available from the website. Additional resources available for youth groups.

Links

• British Union for the Abolition of Vivisection
• CASPIAN
• Fairtrade Foundation
• The Food Magazine
• Global Exchange
• Greenpeace
• International Cocoa Initiative
• International Labour Rights Forum
• Naturewatch
• Oxfam
• Stop the Traffik The story of Chaga and the Chocolate factory, an educational resource for teaching young children about child trafficking in Africa, can be downloaded from www.stopthetraffik.org/chocolatedownloads/chaga.pdf
• World Cocoa Foundation.

References

1 ‘Towards a Sustainable Cocoa Chain: Power and possibilities within the cocoa and chocolate sector’, Oxfam-Wereldwinkels/IPIS, May 2008
2 ‘Child Labour in the Cocoa sector of West Africa’, Sustainable Tree Crops Program of the Institute of Tropical Agriculture 2002. Cited in ‘Where does all our chocolate come from?’, Stop the Traffik, available from www.stopthetraffik.org/downloads/chocolate_factsheet.pdf [viewed 8/9/09]
3 ‘National Initial Diagnostic Survey’, Office of the Prime Minister, Republic of Côte d’Ivoire, June 2008. Available from www.cocoaverification.net/Docs/Rapport_Final_EID_Extension_2007_2008_Eng_(2).pdf [viewed 18/09/09]
4 ‘2007 Country Reports on Human Rights Practices - Côte d’Ivoire’, Bureau of Democracy, Human Rights, and Labor, March 2008. Available from www.state.gov/g/drl/rls/hrrpt/2007/100477.htm [viewed 18/09/09]
5 ‘Scores of children rescued from organized slave labour in INTERPOL-led operation conducted by Côte d’Ivoire police’, INTERPOL, 3rd August 2009, available from www.interpol.int/Public/News/2009/CotedIvoire20090803.asp [viewed 21/09/09]
6 ‘Child labour and cocoa production in West Africa: the case of Côte d’Ivoire and Ghana’, Fafo Research Programme on Trafficking and Child Labour, report 522. Available from www.fafo.no/pub/rapp/522/522.pdf [viewed 18/09/09]
7 ‘Where does all our chocolate come from?’ Stop the Traffik, available from www.stopthetraffik.org/downloads/chocolate_factsheet.pdf [viewed 8/9/09]
8 www.worldvision.com.au/Issues/Human_Trafficking___Slavery/WhatIsThisAbout/What_is_the_real_cost_of_chocolate_.aspx [viewed 8/9/09]
9 ‘Child and forced labour in cocoa growing’, International Cocoa Initiative. Available from www.cocoainitiative.org/images/stories/pdf/child%20and%20forced%20labour%20in%20cocoa%20growing.pdf [viewed 8/9/09]
10 ‘Child Labor in the Cocoa Sector of West Africa’, Sustainable Tree Crops Program (STCP), International Institute of Tropical Agriculture, August 2002. Available from www.globalexchange.org/campaigns/fairtrade/cocoa/IITACocoaResearch.pdf [viewed 18/09/09]
11 The World Bank and IMF Policies in Côte d’Ivoire: Impact on Child Labor in the Cocoa Industry, International Labor Rights Fund. Available from www.laborrights.org/sites/default/files/publications-and-resources/COCOAWBIMF.pdf [viewed 8/9/09]
12 www.alternet.org/wiretap/27500/
13 http://www.du.edu/korbel/hrhw/digest/slavery/africa.pdf
14 http://africanagriculture.blogspot.com/2009/02/gates-foundation-grant-to-cocoa-farmers.html [viewed 8/9/09]
15 www.worldcocoafoundation.org/who-we-are
16 www.cocoainitiative.org/our-mission.html
17 www.iita.org/cms/details/news_details.aspx?articleid=310&zoneid=81
18 www.icco.org/about/about.aspx
19 http://hdr.undp.org/en/statistics
20 www.unctad.org/infocomm/anglais/cocoa/market.htm. Cited in ‘The World Bank and IMF Policies in Côte d’Ivoire: Impact on Child Labor in the Cocoa Industry’, International Labor Rights Fund
21 ‘Poverty in Côte d’Ivoire: A Framework for Action 1997’, The World Bank, 1997, available from http://www-wds.worldbank.org/servlet/WDS_IBank_Servlet?pcont=details&eid=000009265_3971104184200 [viewed 21/09/09]. Cited in ‘The World Bank and IMF Policies in Côte d’Ivoire: Impact on Child Labor in the Cocoa Industry’, International Labor Rights Fund
22 www.globalexchange.org/campaigns/fairtrade/cocoa/background.html
23 www.fao.org/DOCREP/006/Y4343E/y4343e05.htm
24 www.bicusa.org/EN/Article.3417.aspx
25 www.fairtrade.org.uk/what_is_fairtrade/facts_and_figures.aspx
26 www.ft.com/cms/s/0/c69f7fe2-01fb-11d9-8273-00000e2511c8.html
27 Email from company to Ethical Consumer, received 07/09/2009
28 www.guardian.co.uk/lifeandstyle/2004/nov/24/foodanddrink.shopping1
29 www.ethicalconsumer.org/Default.aspx?tabid=62&EntryID=339
30 www.laborrights.org/stop-child-forced-labor/news/12114
31 ‘Where’s the beef? In your breakfast cereal...’, The Food Magazine, Issue 84, January/March 2009
32 Questionnaire retruned by company to Ethical Consumer, 27/08/09
33 ‘Silent invasion: the hidden use of GM crops in livestock feed’, Soil Association, November 2007. Available from www.soilassociation.org/LinkClick.aspx?fileticket=bkVSpF9FMZc%3d&tabid=390 [viewed 21/09/09]
34 ‘New deal agreed to help protect one of the largest ‘carbon stores’ on Earth’, available from www.greenpeace.org.uk/media/press-releases/new-deal-agreed-help-protect-one-largest-carbon-stores-earth-20080815 [viewed 20/11/08]
35 http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10591511
36 http://encyclopedia.thefreedictionary.com/Mars+family
37 ‘Down on the Farm: The Impact of Nano-scale Technologies on Food and Agriculture’, ETC Group, November 2004. Available from www.etcgroup.org/en/materials/publications.html?pub_id=80 [viewed 21/09/09]
38 www.mars.com/global/Commitments/Animal+welfare.htm
39 Desk study provided to Ethical Consumer by the British Association for the Abolition of Vivisection. Refers to J Neurosci. 2007 May 30;27(22):5869-5878
40 Desk study provided to Ethical Consumer by the British Association for the Abolition of Vivisection. Refers to J Proteome Res. 2009 Jul 6;8(7):3464-3474, Mol Nutr Food Res. 2009 Aug;53(8):979-983, Toxicol Lett. 2003 Apr 11;140-141:303-9 and Toxicol Appl Pharmacol. 2007 Oct 15;224(2):174-81. Epub 2007 Jul 3
41 http://www.kraftfoods.co.uk/kraft/page?siteid=kraft-prd&locale=uken1&PagecRef=2562&Mid=2562&cache=off&Print=Yes [viewed 21/09/09]
42 Desk study provided to Ethical Consumer by the BUAV. Refers to Food Chem Toxicol. 2008 Jan;46(1):195-202)
43 Amnesty International Website, October 2007.