“For the love for chocolate”
CALL TO ACTION FOR A JUST COCOA INDUSTRY
Our love for chocolate is shadowed by the hardship that cocoa farmers face. Cocoa farmer poverty is deeply rooted in the purchasing practices of large cocoa and chocolate companies. This leads to situations where child labour and forced labour are used in cocoa production and to deforestation for production expansion. While cocoa traders, chocolate brands and retailers see their turnovers rise to record levels and made high profits, most cocoa farmers don’t reach a living income. Through the way they currently buy and trade cocoa, these companies are preventing farmers from escaping from poverty.
Addressing farmer poverty is a precondition for a sustainable cocoa sector. Only if farmers thrive, will they be able to produce cocoa sustainably. Therefore, our common call to action to the cocoa and chocolate companies is built on three main ways in which companies need to address their purchasing practices to allow for significant changes in the cocoa sector.
We call on all chocolate brands, retailers and traders to:
PAY A FAIR PRICE
- Enable cocoa farmers in their supply chain to earn a living income
- Immediately publish a cocoa living income commitment and strategy, with a time-bound action plan to achieve this*
- Ensure all farmers in their whole cocoa supply chain are paid a living income reference price (LIRP) by the end of 2025, using a credible LIRP benchmark**
SHARE THE RISKS
- Ensure 100% of farmers in their supply chain are provided with standardized long-term contracts by 2030 and 50% by 2025
- Ensure that these contracts reduce risks*** to farmers
BE ACCOUNTABLE
- Publish the standard contract that the farmer signs.****
- Commit to undertaking regular public reporting starting in 2025 on:
- Progress on closing the income gap for farmers in their supply chains, including gender-disaggregated measurement, volumes and farm gate price paid, and responsible purchasing KPIs.
- How the company reduces risk for farmers, including assessments how their purchasing practices pose risks to farmers and how this will be addressed.
- Provide access to an accessible and effective grievance mechanism by 2025
* This needs to be an individual commitment : signing an ISCO statement is insufficient.
** We consider LIRP to be credible when it:
1. involves participation of local people and organisations (including, wherever possible, farmers and women’s representation)
2. is based on realistic variables such as cost of production, yield per hectare, farm size, other sources of income, household size and the relevant living income benchmark. Costs are differentiated for different parts of the country where significant differences in costs exist. See Publications – VOICE Network, p.7 for more background
3. is transparent and provides detailed documentation of the methodology and the analysis on which the LIRP benchmark is based
Examples include the LIRP promoted and implemented by Fairtrade - https://files.fairtrade.net/Fairtrade-Living-Income-Reference-Price-for-Cocoa-update-1-Oct-2023.pdf
*** Risks for farmers include: cash flow risk, price risk, volume risk and investment risk
**** This can be the contract signed with farmers through cooperatives or, Licensed cocoa buying companies (LBCs), whichever level is most relevant
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