Bitter Harvest: Child Labour in the Cocoa Supply Chain

By Lotte Griek, Sustainability Analyst, Jennifer Penikett, Sustainability Analyst, and Esther Hougee, Research Manager

June 12 marked World Day Against Child Labour. This day presents a time for investors to take stock of the state of child and forced labour globally as well as their exposure to this issue. Although 90 per cent of the International Labour Organization’s (ILO) 182 member states have ratified its convention on the Worst Forms of Child Labour (No. 182), introduced 10 years ago, child labour still exists, particularly in the agricultural sector.

The cocoa industry has major exposure to labour rights issues. In early 2001 media reports began to surface linking the industry to abusive labour practices including forced and child labour.

Numerous NGOs have criticised major industry players for their alleged complicity in these abuses. While the complexity of the cocoa supply chain is such that major players are not directly linked to abuses at the farm level, it is safe to assume that most companies operating in the cocoa industry are linked to some extent. Meanwhile, consumer demand for sustainably and equitably produced cocoa is steadily increasing.

In response to public pressure, most chocolate companies have developed or strengthened their supply chain policies and management systems, and have joined initiatives that aim to address social issues, such as poverty and underdevelopment, which contribute to the perpetuation of child and forced labour in the cocoa supply chain.

However, in the view of many stakeholders, the industry is not making sufficient progress. Following the 17th World Cocoa Foundation Partnership Meeting, held in May 2010 in the Netherlands, Norges Bank Investment Management and APG Asset Management, two of the largest pension fund managers in the world, issued a joint statement calling on the chocolate industry to take greater initiative and set concrete targets to eliminate child labour in their supply chains.

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