FLA Highlights Underlying Challenges of Child Labor After Extensive Investigation of Nestlé Cocoa Supply Chain

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Friday, June 29, 2012

FLA maps complete cocoa sourcing process in Ivory Coast for the first time

Geneva, Switzerland – A sweeping, independent investigation by the Fair Labor Association mapped Nestlé’s cocoa supply chain from its headquarters to the farms in Ivory Coast and identified numerous violations of its labor code, especially with regard to child labor. Following FLA’s investigation, Nestlé agreed to build a system to monitor for child labor, forced labor and health and safety risks during the entire crop cycle, not just the harvest, while investing in alternatives for farm workers and their families.

The investigation by FLA found that child labor persists despite industry efforts to discourage the employment of children. Based on FLA’s tracing of the supply chains of Nestlé’s key suppliers, representing nearly 80 percent of Nestlé’s cocoa supply in Ivory Coast, the report released today revealed the systemic and cultural challenges to eliminating child labor on cocoa farms in a nation still recovering from a divisive civil war, which left rural areas with devastated infrastructure and few alternatives for Ivorian children. The report also revealed that efforts to enforce fair labor practices are often impeded at various stages of Nestlé’s supply chain because too few participants down the chain are aware of, or trained to apply, the labor code. As the largest food company in the world, sourcing around 10% of cocoa from Ivory Coast, Nestlé is in a position to have a profound impact on workers’ lives in Ivorian cocoa production through immediate remediation and systemic improvements over the long-term.

“Our investigation of Nestlé’s cocoa supply chain represents the first time a multinational chocolate producer has allowed its procurement system to be completely traced and assessed. For too long child labor in cocoa production has been everybody’s problem and therefore nobody’s responsibility,” said FLA President Auret van Heerden. “Nestlé is taking direct responsibility for decreasing the risks in its supply chain especially when it concerns the persistent challenges of ending child labor. But make no mistake—the eradication of child labor is a long journey and this report is just the first dispatch from the field, with many, many more to follow.”

In its investigation FLA found multiple serious violations of Nestlé’s supplier code; violations which persist in many instances because there are no local laws in place to provide fair and safe working conditions. Health and safety problems are rampant, with 72 percent of reported injuries resulting from workers’ use of machetes. FLA’s investigation also found instances of discrimination due to a lack of appropriate local laws and enforcement systems, and local cultural norms. Nestlé’s labor code limits hours of work to 60 hours per week, including overtime, but workers – especially unpaid family members – often work excessive hours during the harvest. Additionally, compensation rarely provides for all of sharecroppers’ and workers’ basic needs, and there is little opportunity for workers to organize.  Child labor remains the primary cause for concern; even when children do have alternatives to working on cocoa farms and attend school, they often continue to work in unsafe conditions on farms during school breaks.

FLA’s recommendations target the root causes of these labor and human rights abuses, pointing out steps that should be taken not only by Nestlé, but also by farmers, cooperatives, the government of Ivory Coast and other companies that source cocoa from the region. FLA recommended that Nestlé more proactively inform every employee in its supply chain about its code, which prohibits child labor. FLA also encouraged Nestlé to ensure that all actors and individuals involved in their supply chain completely understand the labor code, have monitoring as part of their day-to-day job descriptions, and are educated and empowered especially at the farm level. The central focus of FLA’s recommendations – that comprehensive internal monitoring and remediation cover all parts of the supply chain – will allow Nestlé to identify and remediate code violations more quickly. Additionally FLA’s report revealed the continued need for Nestlé to participate in the establishment of alternative income generation activities for farmers and contribute to the development of vocational schools.

In response to FLA’s recommendations, Nestlé developed an action plan outlining three phases of improvement activities to be completed by the end of 2012, 2013 and 2016. In the short-term, Nestlé agreed to develop a clear, illustrated guide to its supplier code by October 2012. Nestlé will distribute the guide to more than 20,000 farmers participating in Nestlé’s sustainability initiative, the Nestlé Cocoa Plan. The company also agreed to conduct trainings empowering all employees who deal directly with farms to look for violations and encourage compliance with the labor code. Additionally, Nestlé agreed that its key suppliers will work with training agencies to fully incorporate the supplier code into training programs, in addition to distributing the illustrated manual and developing a workshop to explain the manual. This is an enormous undertaking, attempting to create a workforce dedicated to the protection of children and to code compliance in order to improve labor practices that are not currently enforceable by any local law.

In the near and long term, the company will develop a robust monitoring and remediation system that covers all actors in the supply chain, increase both training and the frequency of monitoring, and develop mechanisms for reporting noncompliance and grievances. Nestlé will conduct a baseline survey of child labor at two cooperatives by the end of the 2012/2013 harvesting season and 6 co-ops in the 2013/2014 season, with the goal to establish a baseline measurement of compliance at all Nestlé cocoa plan co-ops by the end of 2015.

“While this mapping effort should result in a decrease in code violations in the next harvest, this exercise has prepared Nestlé to go into the next crop cycle in a more socially responsible way. Now that we know where the risks are highest, Nestlé can begin to hold participants accountable throughout the supply chain,” said van Heerden. “The only way to really address a problem as systemic as child labor is to work from the bottom up, understand the reality of the farmers, workers and their families, and show the value of compliance at the ground level.”  

While many of the findings of FLA’s investigation into Nestlé’s cocoa supply chain are not new, FLA’s approach to tracing the sourcing process of Ivorian beans – from planting, to harvesting, to drying, to shipment and sale, and finally to the chocolate itself – reveals precisely where in the process labor code violations occur, sheds light on the root causes of the most serious violations, and indicates what Nestlé needs to do to strengthen the implementation of its labor code standards. To effectively build the map of stakeholders, the assessment team traveled hundreds of miles, often beyond the end of drivable roads, to reach farming hamlets where pods are opened and beans laid out to dry. FLA conducted more than 500 interviews with workers, cooperatives, Ivorian governmental entities, pisteurs (third party buyers), traitants (traders), coxers (market go-betweens), farmers, sharecroppers and their family members. FLA followed the cocoa procurement process along the entire chain: beginning at the farm where pods are harvested every two weeks; continuing to the different types of buyers and commodity traders; through weighing and sorting at cooperatives where products from many farms are comingled and the traceability of beans is often lost; and finally to the purchasing centers where beans are purchased for processing or export.  

The report is clear that current events in Ivory Coast deeply impact the sustainability of reform: any realistic strategy to eliminate child labor in Ivory Coast would have to start with the attitudes and perceptions of the various participants in the supply chain and communities at large, something that will take a considerable amount of time to achieve. The report puts emphasis on remote rural areas where families have fewer options to support themselves, there are few schools, and children are at a greater risk of injury, far from medical attention. FLA encouraged the government to focus on increasing options for families in rural areas and on increasing the role of local child labor monitors in rural communities. FLA also called on the government to register and identify farmers and third party buyers, similar to an initiative that has been piloted in other cocoa producing nations like Ghana.

“By inviting FLA to completely map and document its cocoa supply chain, consumers will have the complete picture they need to hold Nestlé, the largest food company in the world, accountable for where its cocoa comes from,” said van Heerden. “As the report shows, it is essential that all stakeholders – from farm workers to Ivorian government officials, to exporters, cooperatives and NGOs – work together to change the practice of child labor in the cocoa trade. Now that its supply chain has been mapped, Nestlé will be held accountable for the kind of sustainable and comprehensive changes that ensure a future of responsibly-sourced, code-compliant cocoa.”   

A full copy of the report and Nestlé’s Action Plan are available at http://www.fairlabor.org/affiliate/nestle in English and French.

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About the Fair Labor Association: The FLA combines the efforts of socially responsible companies, civil society organizations and colleges and universities to protect workers’ rights and improve working conditions worldwide by promoting adherence to international labor standards. The FLA holds companies accountable for monitoring their own supply chains and conducts independent assessments to ensure that the FLA Code of Conduct is upheld. The FLA also acts on and resolves third party complaints and special investigations about workers’ rights abuses at specific factories. Through public reporting, the FLA provides consumers with credible information to make responsible buying decision. FLA is governed by a 19-member Board of Directors that includes an independent Chair and eighteen members equally representing leading universities, labor and human rights organizations, and companies. For more information, visit www.fairlabor.org

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