Consuming issues - Cocoa's certification challenge
The sector needs to agree on sustainability standards
Hershey's commitment to source 100% of its cocoa requirements from third-party-certified sources by 2020 has been broadly welcomed. However, what form that certification will take is unclear and is likely to remain so until the cocoa sector at large agrees sustainability standards and evolves the means to certify a huge amount of cocoa.
The recent launch of the Hershey 21st Century Cocoa Plan and its pledge to source 100% certified cocoa by 2020 marks the latest in a series of positive developments in the cocoa/chocolate sector's bid to tackle the issue of child labour in its supply chains along with other critical structural challenges.
The announcements by Nestle, Mars Inc, Ferrero and now Hershey are clearly indicative of a raised sense of individual accountability by branded companies, prompted in no small part by sustained pressure from campaigners. Hershey had become a particularly favoured target for US pressure groups.
In spite of the hard work of many engaged in collective efforts since the signing of the Harkin-Engel Protocol in 2001, it is fair to say the collective push on child labour had become stalled as successive target dates were missed.
In the meantime, other structural issues facing the west African cocoa sector, relating to low productivity and profitability, the urgent need for investment in training and new tree stock, and an ageing farming population and migration from farming by younger generations, have only worsened. In fact, in the eyes of many the sector has now reached crisis point, particularly given the sharp rise in demand anticipated during the coming years.
While the recent announcements can be characterised as greater proactive, individual engagement on the part of companies that see the resolution of these issues as critical to the long-term sustainability of their businesses, it is becoming increasingly evident they are also benefiting the collective process.
The campaigner strategy on child labour has always been to place the maximum pressure on branded companies in the hope that that will have a knock-on effect on the less publicly prominent companies which supply them, and this appears little by little to be happening.
Last year, Barry Callebaut launched a high-profile sustainability strategy called Cocoa Horizons. It is unlikely to be mere coincidence that in the last eight months, the three principal cocoa traders, Armajaro Trading, Olam International and most recently Touton, have joined the International Cocoa Initiative (ICI), the multi-stakeholder initiative set up as part of the Harkin-Engel process.
ICI executive director Nick Weatherill sees this as a "very significant" development for ICI because of the "key role" these companies play in the supply chain. However, while he agrees there may be an element of client demand here he says it has as much to do with these companies simply "protecting the longevity of their businesses".
In general, Weatherill believes the collective effort has had a boost over the past year or so, discerning a "greater readiness to share lessons", and welcomes the recent announcement from Hershey as "a very positive move".
Elizabeth O'Connell, campaigns director at Green America, one of the organisations behind a concerted campaign targeting Hershey, sees the company's announcement as "a good first step", though is keen to hear more detail. In particular, campaigners are eager to know what form of certification companies envisage that their brands will be subject to as they execute on such commitments.
Speaking to just-food, Hershey vice president for cocoa sustainability Andy McCormick said he was confident the company could meet its first target - 10% certified by the end of this year - from the three primary certification schemes which Hershey and its peers currently work with, namely Fairtrade, UTZ and Rainforest Alliance. But he said the company was not yet in a position to say how the intermediate target - 40% to 50% by the end of 2016 - or its final 2020 target would be met.
This is not surprising. It is a question all the companies will be addressing. While Fairtrade, UTZ and Rainforest Alliance have been instrumental in moving the dial on sustainability in cocoa, none is realistically going to be able to meet the kind of volumes that would be required when large companies seek to certify all their production.
There are worries on the part of NGOs that the ambitious aspirations of the major companies could result in the proliferation of certification systems with inconsistent standards, which would certainly confuse consumers, or that a broader-based certification scheme might be initiated in due course with less exacting sustainability criteria.
This could be another way in which company-specific commitments to certified cocoa might foster collaboration and collective action. Such ambitious commitments could well require some form of systemic collaboration with regard to certification.
Indeed, in fledgling form this may have already begun. The European Committee for Standardization (CEN) is working towards the development of Europe-wide sustainability standards for cocoa, involving a wide range of stakeholders. The question many are now asking is whether the CEN process could evolve into a new, broader, international certification system.
The multi-stakeholder participation in the CEN process gives hope that any standards eventually agreed would be acceptable to all parties, though at this stage it is more about agreeing standards than certification. "There is no objective to turn those standards into a certification scheme per se as far as I understand, but it may well provide pointers and guidance as to how certification can go to scale without being watered down," Weatherill adds.
Some are eyeing multi-stakeholder initiatives such as the Roundtable on Sustainable Palm Oil and the Round Table on Responsible Soy as possible collective models to emulate.
In fact, the cocoa sector has already had one attempt at a "roundtable". The ICCO, which groups together cocoa-producing countries, launched the Roundtable for a Sustainable Cocoa Economy (RSCE) in 2007. However, only two meetings were held, the second of which in 2009 was a cause of some acrimony.
The Cocoa Barometer 2012, a report on the sustainability challenges facing the cocoa sector and responses to them compiled by a group of NGOs including Oxfam, Solidaridad and Stop the Traffik, concludes that "at present a true sector-wide approach to the economical, ecological and social crises in the global cocoa production still needs to take significant shape".
The question is whether the practical need for a publicly credible, functioning sustainability certification system that can be taken to scale might be the catalyst for the creation of a comprehensive global cocoa compact bringing together all stakeholders.
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