The VOICE Network, a coalition of organisations in cocoa, has issued a position paper that rejects certification as a long-term solution to poverty and sustainability in the supply chain and seeks systemic solutions.
“When the only tool you have is a hammer, a lot of your problems start looking like nails. For a long time, in the cocoa sector, it seemed like the only tool available to achieve sustainability was certification,” said VOICE Network.
“With a slew of major developments – such as the release of the new ISO standard, Fairtrade’s revised Minimum Price and Living Income Reference Price, and the work on the new merged Rainforest/UTZ standard – it is time for civil society to take stock of where we are.
“Chocolate companies and retailers have a tendency to look for the cheapest label, neglecting the potential negative effects of this price pressure,” said the Network.
“The race for certified volumes has not raised the bar. None of the standards have been able to significantly contribute to farmers achieving a living income or lift farmers out of poverty. Although the average income of certified farmers might be slightly higher than non-certified farmers, the overall impact is relatively low; a certified cocoa farmer is still nowhere near earning a living income.
“Income interventions from certification have not been sufficient. The recent announcement by the governments of Côte d’Ivoire and Ghana of a floor price of US$2,600/ton is a good step but falls far short of the US$3,467 (resulting in US$2,668 at the farm gate) that Fairtrade claim is necessary for a living income. Neither Rainforest nor Fairtrade have plans to pay anywhere near that price, except in small pilot projects.
“Despite the fact that between a quarter and a third of all the global cocoa production is grown under a certification label or company sustainability label, major problems persist, including on certified farms. Child labour is still a major challenge in all major West African cocoa-growing nations and deforestation is the norm rather than the exception.”
The Network said what it described as systemic solutions are needed. “In order to be able to find solutions, clarity on the nature of the problems is urgently required. After almost two decades of efforts trying to improve cocoa farming itself, it’s time to realise that the cocoa farmer is not the problem; the problem is systemic.
“Systemic problems require systemic solutions, not a tick-box exercise at farm level. Currently, the cocoa farmer bears almost all of the risk, reaps hardly any of the reward, and no one is taking the responsibility for this systemic failure.
“Solutions should deal with the distribution of risk, reward, power and responsibility throughout the value chain. The systemic failure of voluntary initiatives provides strong evidence that legislative measures on environmental issues and human rights due diligence are needed. In the meantime, all standard-setting organizations need to improve their systems, acknowledging that a sustainable solution needs to include price mechanisms.”
Responding to VOICE Network, Fairtrade said it welcomed the call for all certification schemes to introduce a minimum price and fixed premium for cocoa in order to prevent a race to the bottom on cocoa prices.
“We welcome VOICE’s call for Rainforest Alliance/UTZ to adopt a minimum price to protect farmers and to give clarity on whether the intended mandatory premium under their new standards will have a fixed minimum or is negotiable,” said Jon Walker, Fairtrade International’s Senior Advisor for Cocoa.
“Fairtrade believes a critical factor to eliminate extreme poverty is to pay farmers a fair price for their cocoa, but we can’t do it by ourselves,” said Walker. “Real change will only come about through a collective approach, and the recent announcements by the Ivorian and Ghanaian governments of a floor price are therefore an exciting development.”
Regarding VOICE Network’s call for Fairtrade to publish a timeline to require buyers to pay a mandatory living income reference price, Mr Walker said, “Fairtrade cannot reach living incomes by unilaterally increasing prices to buyers. Higher prices will only have an impact if buyers are prepared to pay, and a unilateral increase of this size risks wiping out many of the gains made so far made for cocoa farmers. We have always been clear that raising the Fairtrade minimum price was only the first step – albeit an important one – towards a decent income for west African cocoa farmers.”
“We agree with VOICE that systemic solutions are needed. This includes levelling the playing field on price. Fairtrade’s strategy for achieving living incomes for cocoa farmers incorporates an enabling environment by government which should lead to a collective approach. Price is one of the critical elements for achieving living incomes. As VOICE themselves point out, chocolate companies and retailers have a tendency to look for the cheapest label.
“We take the VOICE statement seriously. Addressing the issues that it raises are part of our continuous efforts to improve our work towards sustainable livelihoods. The chocolate that so many of us love to eat cannot continue to be produced at the expense of farmers and their families living in poverty without access to the basic human rights enabled by a living income.”
For more information see the September 2019 issue of Coffee & Cocoa International.