CSRNYC

CSR IN THE CHOCOLATE INDUSTRY

Hershey, Mars, Cadbury Schweppes

By Dina Rubinstein (posted by permission), 4/2/2008

     My perfect ending to any meal?  A warm molten chocolate cake.  My favorite part of a Carvel ice-cream cake?  The chocolate crunchies.  My ultimate ice-cream flavor?  Chocolate Peanut Butter Cup.  Isn't it clear?  I am a chocoholic.  I almost always choose to eat desserts that have chocolate in them and I will always reach for the M&M's over the skittles.  Chocolate makes me feel good; it's a comfort food and takes me back to my childhood.  My mom loves to tell me that when I was a toddler I never liked to eat my vegetables, but I never refused chocolate and my preferences have not changed too much.  Rainbow and lace cookies take me back to my grandmother’s house, chocolate ice-cream was the dessert of choice in my parents’ home and Snickers bars are what I always craved at the candy store.  Chocolate is also a major part of the holidays I celebrate including the Hanukah Gelt, chocolate-covered Passover Matzo and a box of Godiva for Valentine’s Day.  To me, and millions of people around the world, chocolate equals happiness, it makes you feel good and nostalgic and that is not by accident; otherwise why would Hershey’s new line of chocolates be named Hershey Bliss? 

     Corporations spend hundreds of millions of marketing dollars to associate these feelings with their crave-able branded chocolate treats.  Some of these feel good chocolate products include:  Almond Joy, Hearth Bar, Hershey Kisses, Milk Duds, Whoppers, Cadbury Cream Eggs, Yoo-Hoo, Snickers, Dove Bars and my favorite, Twix.  These are the brands of three major chocolate manufacturers: The Hershey Company, Mars Incorporated and Cadbury Schweppes.

     These manufacturers make up a large share of the market in the chocolate industry and in order to continue their positions at the top they need to keep marketing, promoting and most importantly selling their feel good treats.  However, not all is cheery in the profitable world of chocolate - there is a dark side to manufacturing chocolate.  I believe that Hershey, Mars Incorporated and Cadbury Schweppes invest a tremendous amount of time and money to make sure the dark side of chocolate is never associated with the lighter side of chocolate and they also look to improve upon the dark side of chocolate. 

   To illustrate, on the one hand a Cadbury Egg brings joy to so many children’s faces while on the other hand so many other children suffer to produce this joy.  Those who suffer are primarily the children who work in the cocoa plantations of West Africa.  They toil to produce tons of chocolate that Americans eat each year.  It is estimated that in the West African nation of the Ivory Coast alone more than 600,000 children work on cocoa fields and research "...reveals that up to 80 per cent of the children in the cocoa fields are being exposed to dangerous practices such as unprotected use of chemicals, carrying heavy loads, brush burning and using machetes.  About half of these children do not go to school.  There is also evidence of children being trafficked.  The trafficked child will often live with the cocoa farmer's family but as a second class citizen.  The child won't go to school, won’t get paid and will do the dirtiest and most dangerous work on the cocoa field." (Slavery and Exploitation in the Cocoa Trade, Tim Costello, couiermail.com.au). 

    The dichotomy between the joy of chocolate and the misery of cocoa sourcing is almost not to be believed but Hershey, Mars and Cadbury Schweppes, along with other industry partners, governments, non government organizations (NGO's), international agencies and cocoa communities do all that they can to make the sourcing as socially responsible.  These varied partners do this not only because it's the right thing to do, but also because social responsible sourcing is proven good business as "the chocolate industry needs a stable supply of raw ingredients" and "... that a truly sustainable cocoa supply (requires) a coordinated effort of all interested parties" (marsincorporated.com).        

Hershey

     One of the pioneers in socially responsible cocoa farming is The Hershey Company.  Hershey is committed to making a difference in the communities where they live, work and do business.  This commitment dates back to the values of its founder, Milton S. Hershey, who left the majority of his wealth to a charitable trust, and this commitment is vital part of both Hershey's heritage and who Hershey is today. (hersheys.com)  In keeping part with the Hershey tradition, they take a leadership role in improving the lives of the cocoa farmers and their families in order to promote sustainable cocoa farming. 

     Hershey takes a holistic view of sustainable cocoa farming by seeing the value in improving cocoa farming in a variety of ways including: improving farmers’ incomes, protecting the tropical ecosystem, ensuring responsible labor practices and improving access to education.  This is vitally important since for the majority of cocoa farmers their crop is the major source of income for their families and communities (hershey.com)  One of the ways in which Hershey looks to improve farmers incomes is to assist farmers in crafting more profitable crops, which is not always easy since crops are often lost, 30% on average annual loss, due to pests and disease (hershey.com). 

   One initiative that Hershey’s supports, as a member of the World Cocoa Foundations (WCF), is the Farmer Field Schools program which significantly raises farm family income through training cocoa farmers on how to increase productivity, reduce crop loss and to diversify into other crops (hershey.com).  Specifically, through the Farmer Field Schools, farmers are taught to manage crop pests and disease through Integrated Pest Management (IPM) techniques, reducing their agricultural chemicals.  (hershey.com) 

   Another related effort to increase cocoa farmers’ incomes, run through the Sustainable Tree Crops Program (STCP), helps to organize West African Farmers to sell their cocoa collectively which helps them achieve a higher price for they commodities and so far these efforts have helped participating farmers in Cameroon and the Ivory Coast saw their incomes increase by 55 percent and 24 percent respectively. 

     Another part of Hershey’s holistic approach is to closely examine, and improve upon, the use child labor in cocoa sourcing.  One way Hershey’s is taking steps to ensure responsible labor practices, especially in regards to child labor, is by joining with the worldwide cocoa and chocolate industry in singing a congressionally sponsored protocol, The Harkin-Engel Protocol which is designed to eliminate child labor from cocoa growing (hershy.com).  Another partnership Hershey is involved in is the International Cocoa Initiative (internationalcocoa.org) and together with ICI Hershey is "actively helping farm communities in West Africa better understand the kinds of farm work appropriate for children"; (hershy.com) appropriate farm work means that these West African children should be spending more time in school rather then on the fields. The Hershey Company is working with the International Foundation for Education and Self-Help (IFESH) to provide teacher training in the cocoa-growing regions of Ghana and the Ivory Coast.  The Hershey IFESH program reaches more than 2,000 teachers and will benefit approximately 40,000 primary and secondary school students (hershy.com). 

Mars

    Hershey is not alone among the big chocolate manufacturing companies in their efforts to ensure more responsible cocoa sourcing.  Mars Incorporated is also at the forefront of cocoa sustainability.  Mars Incorporated also looks at cocoa sustainability as "a holistic, proactive global partnership designed to ensure future supplies of cocoa" (marsincorporated.com) and also as a responsible approach to its production so that the community in which the cocoa is produced can thrive.  Mars' goes as far as to say that "(their) unique investments have launched a new era in cocoa". (marsincorporated)  Mars sees cocoa not only a commodity, but also as a potential engine for economic growth, social improvement and environmental sustainability in the areas cocoa is made. 

     Mars is also a corporation that strongly believes in the art of "cocoa science" which aims to improve the stability of cocoa crops.  Some of their methods include:  breeding programs, bio-control management systems, responsible chemical control and farmers being trained to improve soil nutrients.  Mars, like Hershey, is also a key player in addressing abusive child labor in the cocoa industry and also works in conjunction with the ICI, United States Agency for International Development (USAID), the International Labor Organization (ILO), the WCF and other interested parties to stop the terror associated with child labor on the cocoa fields.  Mars is also committed to even going beyond the Harkin-Engel Protocol in order to meet the challenges of combating child mistreatment in cocoa farming.  Mars' overarching goal is to fund programs in West Africa aimed at making a positive difference in the lives of cocoa farmers, their families, communities and the environment." (marsincorporated.com)    

Cadbury Schweppes

     Joining Hershey and Mars in their effort for responsible cocoa farming, is the world's leading confectionary company, Cadbury Schweppes.  Cadbury's commitment is evidenced by establishment of the Cadbury Cocoa Partnership, which seeks to "secure the economic, social and environmental sustainability of around a million cocoa farmers and their communities in Ghana, India, Indonesia and the Caribbean, through:  Long-term commitment to improving farmer livelihoods and farming communities, direct farmer involvement alongside NGO partners and governments and Ghanaian President and United Nations pledge support." (Cadburyschweppes.com) 

   Cadbury Schweppes also recognizes the importance of responsible cocoa farming as a key element in their commercial success by ensuring a reliable, long term source of the right quality cocoa, produced to the high standards their business and their customers expect. (cadburyschweps.com).  Similarly to Hershey’s and Mars, Cadbury is a member of the ICI and is active in partnerships, specifically with Earthwatch and Ghana Nature Conservation Research Center, to launch three-year project to improve biodiversity of cocoa farms in Ghana and establish the country's first cocoa farm eco-tourism initiative. (cadburyschweps.com)  Another common theme in responsible cocoa farming that Cadbury Schweppes is involved in is the concept of helping to improve the lives of cocoa farmers by developing more sustainable crops and therefore generating more income for their crops. 

      One area in which Cadbury Schweppes appears to place more emphasis on regards to sustainable cocoa is their commitment to the Fair Trade Movement.  Cadbury Schweppes wants all farmers to receive a fair return for their crops and Fair-trade is one way is of reaching this goal.  In fact, Cadbury offers a Fair-trade chocolate though their Green & Blacks Maya Gold brand. (cadburyschweps.com).  However, while Cadbury supports fair trade, they are realistic and recognize that the majority of cocoa farmers do not have access to the infrastructure that make Fair-trade possible, such as farm cooperatives, and look for others ways to help cocoa farmers to increase their incomes including:  assisting farmers to collectively market their produce, help farmers to create a sustainable,  environmentally and biologically diverse agricultural system.., implement pest and disease control management and boost investment in social infrastructure. (cadburyschweppes.com)  The overall theme from Cadbury Schweppes, very similar to that of Hershey and Mars Incorporated, is that they want cocoa farmers to receive a fair return for their crops and to produce high quality cocoa beans in a sustainable way that creates wealth for the farmer, their families and the communities in which they live. (cadburyschweppes.com)

Joint Producer Action

     It is clear that Hershey, Mars and Cadbury Schweppes believe that the only way to achieve their goals of sustainable cocoa farming is through public/ private partnerships with the chocolate industry, government, international donor and development organizations, NGO's and cocoa farmers.  These groups together exist with knowledge and shared resources to achieve objectives that can lead to truely sustainable cocoa farming (marsincorporated.com).

    A key participant in the aforementioned group is International Cocoa Initiative whose goal is to end child and forced labor in cocoa-growing (cocoainitiative.org).  Of course, this is not an easy task for the ICI and their partners since most children do willingly work on their family cocoa farms but "most of these families are poor, often with little or no education, and their cocoa crop is their main source of income and children can be exposed to hazards unwittingly or through lack or awareness." (cocoainitiative.org).  Additionally, during peak farm peak farming times children may be kept out of school to help on the farm often leading to low achievement or leaving school all together.  However, by helping farmers and families understand the risk of certain activities and the illegality of other, the ICI is beginning to change the way cocoa is grown.  (cocoainitiative.org) 

    The effective ICI was established in 2002, as part of the Harkin/ Engel Protocol, as a groundswell of opinion urging the chocolate industry to ensure child and forced labor were not used in the production of their products. (cocoainitiative.org)  ICI continues to work with a broad range of stakeholders to identify the most efficient and effective ways to end abusive labor practices in cocoa farming, but the ICI too is realistic in that they understand ending abusive labor practices will not happen overnight and that it takes a long-term commitment from all those involved, from the cocoa farmer to the chocolate maker. (cocoainitiative.org)

     Another key participant aside from the leading chocolate manufactures and the ICI in the quest for sustainable cocoa farming is the World Cocoa Foundation (WCF).  The mission of the WCF is to “...promote a sustainable cocoa economy through economic and social development and environmental conservation in cocoa communities" and there are four principals that guide their mission:  long-term solutions matter more the quick fixes, partnerships drive success, community involvement is essential, and the chocolate industry plays a key role. (worldcocoafoundation.org)  The WCF looks to companies like Hershey, Mars and Cadbury Schweppes to help achieve their goals through their energy, ideas and resources.  Another promising initiative that the WCF leads is "Healthy Communities", which works with West African farmers to educate them on responsible safe labor practices, while also helping farm families earn more money for their crops.  (worldcocoafoundation.org)

     While much progress has been made in social responsible cocoa farming, there is still a long way to go.  The cocoa industry and their partners are taking the next step to achieve sustainable cocoa farming – the third-party verification process for responsible farming.  This is an extension of the Engel-Harkins Protocol and the industry is committed to expanding the pilot certification system to cover 50% of the cocoa growing areas of Cote d'Ivoire and Ghana by July 1, 2008.  Independent verifiers will be in the fields for the fist time beginning in May 2008 (csrwire.com - press release from Verite).  This is a huge step for a industry where 90% of the world's cocoa comes from small holdings owned by an individual or family and are typically 5 hectares (12.25 acres) in size (worldcocoainitiative.org) and the cocoa farms are generally small and un mechanized.

     The Hershey Company, Mars Incorporated and Cadbury Schweppes have all made tremendous strides in the area of sustainable cocoa farming, but recognize they still have a long ways to go.  They also all look at the key to success through public and private partnerships as sustainable cocoa is not something one person, manufacturer, government organization or NGO can do alone.  I too realize that no manufacturer is perfect and that at the present time not all the cocoa we consume is perfectly "responsible" but I must give credit to the industry for taking the appropriate steps to lead themselves in the direction of sustainable cocoa farming. 

     Responsible cocoa sourcing is a necessity, not on option for chocolate manufactures for the following reasons.  Each chocolate manufacturer relies on a high quality and steady supply of cocoa to meet their consumer’s seemingly unending demand for chocolate treats.  A demand which can only be grown and maintained when chocolate continues to be associated with joy, because the day that chocolate stops equaling happiness and starts being associated with forced child labor is a day the chocolate industry is going to face a major problem that they may find it hard to recover from.