Consumer’s confusion over sustainability labels spurs outcry among cocoa industry leaders

By Douglas Yu

- Last updated on GMT

Chocolate industry leader believes cocoa sustainability is usually a tool for chocolate companies to build brand image. Pic: ©iStock/dimarik
Chocolate industry leader believes cocoa sustainability is usually a tool for chocolate companies to build brand image. Pic: ©iStock/dimarik

Related tags Cocoa sustainability Chocolate

Cocoa industry insider, Marc Donaldson, voiced that approximately $2bn investment in cocoa sustainability over the past 10 years has achieved “so little.” He suggested consumers should take the sustainability issue on themselves instead of pushing the responsibility to the manufacturers.

ConfectioneryNews correspondents recently did a vox pop project​, including questioning consumers in Chicago whether they could recognize sustainability labels on the packaging of chocolate, such as Nestlé’s Cocoa Plan and Rainforest Alliance.

However, the result contradicted an earlier report that shows nearly half of the consumers can recognize those labels.

“This is not 50%. Only two of the respondents had any clue as to what they were talking about,”​ Donaldson commented on the video. “Non-GMO is not a sustainability label, although several thought it was.”

Donaldson told ConfectioneryNews that he has worked in the cocoa and chocolate industry for about 30 years. He previously worked at Barry Callebaut as managing director for nine years, and was director of cocoa sustainability at Petra Foods, according to his LinkedIn account.

He mentioned that there is a misconception among consumers that cocoa sustainability is linked to quality, which is not the case.

“It may or may not improve the quality of the product, but its aim is to improve that social economic environment for cocoa farmers and their families,”​ Donaldson said. “Otherwise, they will die out and we will have not enough cocoa.”

The lack of a global standard

Consumers are totally confused by a myriad of different claims and sustainability brands, all of which compete with each other, and all of which change their standards on a regular basis, “normally downwards”​ to meet changing market conditions, Donaldson pointed out.

“Credibility, monitoring and evaluation of projects in cocoa growing regions is well understood to be very challenging and unreliable on many occasions,”​ he said.

“Cocoa sustainability will never be correctly understood unless there is one global standard, that is not a competitive tool for brands to use.”

However, most public companies, such as Hershey, Mondelēz and Unilever, are not able to receive investment funds unless they participate in sustainability projects, according to Donaldson’s experience.

“The brand represents 80% value of a company. Investments in those [sustainability] programs are meant to help maintain the brand image,”​ he said.

In Donaldson’s opinion, Mars only has fair trade labels in the UK, because it wants to compete with Cadbury. Mars did not immediately comment on their cocoa sustainability strategy in the UK.

Mondelēz recently teamed up with Fairtrade to expand its Cocoa Life program to its Cadbury brand, this site reported last month. Cadbury products in the UK and Ireland will carry a small Fairtrade Foundation logo on the back of pack and a larger Cocoa Life logo on the front.

A recent Euromonitor report shows that there is a growing number of boxed chocolates in many Western European countries that now carry ethical labels.

“In Germany, for example, retail sales of boxed chocolates bearing at least one ethical label reached $1.4bn, and $1.3bn in the UK in 2015,”​ the report said.

However, senior analyst from the market research firm, Hope Lee, said that it will take time for chocolate manufacturers to standardize their ethical labeling efforts in both developed and developing markets.

“If [chocolate manufacturers] continue to use sustainability claims as a competitive edge, the consumer will always be cynical,”​ Donaldson said.

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private investor

Posted by Steen Johansen,

How about the 12 multinationals in cocoa industry CEO, plus vice presidents provide last year Payslip. Then one would see who makes money in this business. Not to mention the shareholders of Cargill, Mars, Mondelaez, Olam, Ecom trading, Hershey trust, etc. Its strange that the raise in child labour has risen 30% last 3 years does not affect them. Of course every farmer is an entrepreneur, he cant afford adult payment, so he uses his own children to harvest the cocoa pods. I dont think the children of the CEOs, directors in ANY of the BIG 12 ever needs to work in cocoa business. I suppose transparency does not give any effect in such cynical business, they just postpone reinvestments in the region.

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private investor

Posted by Steen Johansen,

None of the 12 multinationals respect Harkin&Engel protocol. None of them cares for paying the fertilizer needed for raising the cocoa volumes, in West Africa. How can it then be profitable for the countries themselves? They should UNIFY, like OPEC countries. Double the current cocoa price, its rarely been so low as today. Even Ivory Coast suspended cocoa export few days ago. In 1980 a farmer got 16%of a chcocolate bar cost, today he gets 3%. Anyone telling its fairtrade is a LIAR. Why does Mars family have a fortune of 81 billions usd.? How much do they reinvest back? Same as all the other multinationals , less than 0,01%. They never show their profits. The whole world has become based on greed and profits.

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Posted by Cocoa,

It is being pushed to manufacturers by the media and "sustainability" activist groups. Consumers just like to see the label and feel good about it - they dont know or care about the actual impact. Manufacturers are pushed into getting a label. And you think certified means no child labour? Think again.

Also has anyone checked how much of the certification money is spent on overhead costs of the sustainability organisations in US and EU? You'd me amazed at the amount of money spent for US/EU offices, salaries of staff and the constant travel costs to African countries , while most people can't even afford to travel to Africa with their personal savings. So yeah, some of the money does some good but you can't throw a pack of money and feel good about changing the full economy, culture and system in any African country.

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