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January ’20 Editorial Comment: Time is right for diligence and living incomes

January ’20 Editorial Comment: Time is right for diligence and living incomes

The last couple of years have seen rapid progress made in the direction of regulatory measures and due diligence legislation that would require companies to ensure that cocoa imported into the EU isn’t tainted by deforestation, but it is also at the heart of the chocolate and cocoa sector’s other huge sustainability issue, child labour, a decades-old problem that has never properly been addressed.

A multitude of initiatives have come and gone that aimed to tackle child labour in cocoa, including certification schemes and voluntary corporate sourcing initiatives, not forgetting the Harkin-Engel Protocol in 2001, which saw the industry commit to reducing and eventually eliminating child labour. By and large these initiatives have failed because they haven’t involved all of the actors in the supply chain, including producer and consumer-country governments, the full array of companies, many of them SME’s in consuming countries, and because they simply haven’t had sufficient scale.

As by far the largest importer and consumer of cocoa in he world the EU has a greater ability than any other market to drive change in the cocoa sector, and a clear duty and opportunity to take responsibility and demonstrate leadership, including legislative action to address child labour and deforestation. So, it was good to read a joint position paper on the EU’s policy and regulatory approach to cocoa in which leading chocolate companies, the VOICE Network, Mighty Earth, Rainforest Alliance and Fairtrade called on the EU to strengthen environmental protections and human rights safeguards in the sector.

As highlighted on page 34 and 42 of this issue, the volume of sustainably produced, certified cocoa is growing and efforts are underway in Côte d’Ivoire and Ghana to increase farmers’ incomes through a Living Income Differential (LID), but growing use of voluntary sustainability standards and the LID alone won’t raise farmers out of poverty and won’t reduce deforestation and the use of child labour.

In contrast, an approach that could help address both issues is described on page 50 by Heidi Hautala, Vice-President of the European Parliament. In a speech at the World Cocoa Foundation Partnership Meeting in Berlin in October, she highlighted the EU’s growing interest in Sustainable Development Goals and its focus on responsible and sustainable supply chains and the use of due diligence legislation to achieve them. As Ms Hautala noted, there is growing recognition in the European Parliament “that the EU is clearly part of the problem of global deforestation.” and that regulatory and non-regulatory measures are needed.

Due diligence approaches are increasingly a feature of legislation in the EU and its member states and have worked in other sectors. They could work in cocoa, not just because they compel companies to address issues such as child labour and deforestation and hold them accountable for any failure to apply due diligence, but because EU-wide regulation would benefit companies themselves, providing a common framework through which they can show how they are seeking to identify and mitigate human rights and environmental risks.

Due diligence legislation would eliminate free riders and close loopholes, ensure a level playing field and provide predictability and consistency with a single EU jurisdictional approach – rather than many different systems at member-state level. It would significantly increase legal certainty for companies and enhance the ability to act at scale and in a consistent manner throughout the supply chain in a way that voluntary sustainability schemes and the company sustainability schemes can’t.

If the EU reaches agreement on legislation, regulation should apply to all of the companies placing cocoa and cocoa products in the EU market, including those that import, process and sell cocoa and cocoa products, and it should apply to companies regardless of where they are based or registered or their legal form or size.

As the position paper signed by the chocolate companies said, the need for action is urgent but it is encouraging that at long last there is real momentum behind the idea of a responsible cocoa sector. As Ms Hautala told the partnership meeting, “the time is right” for a combination of mandatory, voluntary, national and international measures to foster respect for human rights in supply chains. It’s an approach that is in line with the UN Guilding Priciples on Business and Human Rights that can benefit all of the actors in the chain and address deforestation and child labour.

An end to deforestation is unlikely as long as farmers live in poverty, and as long as they live in poverty, child labour will persist. But a twin track approach that combines regulation of the type that is being addressed by the EU and a living income commitment of the type enshrined in Beyond Chocolate, the Belgian sustainable cocoa initiative (see pages 28-29) would be a massive step in the right direction.

This Editorial comment  first appeared in the January’20 issue of C&CI. Click on subscribe now if you wish to read more informative articles in the current and future issues of C&CI.

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