Confectionery firms including Ferrero, Mars, Nestlé and Mondelez call for EU-wide cocoa policy

Traditional cocoa growing may change significantly in coming years, if technology solutions prevail

Key confectionery businesses including Ferrero, Mars, Nestlé, Mondelez International and Tony’s Chocolonely have joined with the Rainforest Alliance and Fairtrade in stepping up calls for EU-wide due diligence policy on cocoa supply chains, with a new position paper, writes Neill Barston.

As the collective of signatories, which also feature the International Cocoa Initiative, Unilever, and campaigning organisation the Voice Network, stressed that unless mandatory strategy is implemented across Europe, then the sustainability of the sector cannot be achieved.

The situation with supply chains in core markets of Ghana and Ivory Coast has become increasingly challenging, with significant issues of oversupply amid the pandemic placing notable downward pressure on prices – which in turn is considerably impacting on farming communities.

The group of leading companies and civil society organisations produced an initial paper two years ago, which they asserted requires actioning in Europe. This comes amid a planned introduction of such legislation was put back until later this year by the European Commission, following reported lobbying from certain quarters of industry.

In a joint statement, the confectionery companies said: “Although we fully support the implementation of such due diligence legislation, its effectiveness will be limited unless it is coupled with the creation of the enabling environment required to make progress on sustainable cocoa farming within cocoa-producing countries.

“Accordingly, we believe that it is essential for the EU to pursue the establishment of long-term partnership agreements with the governments of cocoa-producing countries, ensuring that all relevant stakeholders are involved, including local community representatives, farmers, industry, and civil society. These partnership agreements should include time-bound frameworks for action for all parties involved. They should place a particular emphasis on actions at the policy level by producer governments, and include incentive mechanisms and support from the EU and its member states to ensure that the necessary actions can be implemented successfully.

“This focus on policy and governance in producer countries is a critical element that initiatives in the cocoa sector must take into account, contributing to establishing the right enabling environment, which in return is necessary for supply-chain-focused initiatives in the cocoa sector to be truly impactful at scale.”

As the group noted, there were several key objectives as part of the EU’s policy work, which included:
1. Clarifying what is needed to establish a sustainable cocoa sector within the producer-country
partner and what different actors in the supply chain need to do to achieve it.
2. Set out the changes in governance, including transparency, and policy, and/or improved
enforcement of existing policies, that would be needed to produce cocoa sustainably.
3. Put in place incentive and support mechanisms, including funding, to ensure that the
required policy changes and measures are implemented.
4. Establish monitoring systems to assess the impacts of the policy changes and measures
and ensure that any unintended negative consequences for people or the environment are
avoided.

Furthermore, the paper called for the establishment of a producer-country national deliberative process, involving all stakeholders, to determine the conditions for the sustainable production of cocoa and to agree on the necessary reforms of policies, laws and institutions, must be central to each partnership agreement.

As they noted, it should be modelled on the FLEGT VPAs, this deliberative process is not merely consultation; it must be a
coordinated effort to open up decision-making in the cocoa sector, involving cocoa farmers and cooperatives, local communities, including women, and civil society.

Crucially, the group added that EU strategies must also include monitoring systems that should also track the impact of the agreements more widely than just cocoa production and deforestation, including, for example, changes in farmgate prices, farmers’ incomes. It should also address the incidence of child labour, patterns of land use and other factors. It will be important also to ensure that any unintended negative consequences of policies and measures are identified and
prevented or mitigated.

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