New Oxfam study shows cocoa suppliers still falling short on supply chain transparency

A new Oxfam report finds the world’s top food and beverage companies have improved global social and environmental policy commitments, but struggle to turn them into action on a local level.

A spokesperson for Oxfam said: “On gender and cocoa specifically, Oxfam has found that large agribusiness suppliers continue to fall short of their customers in adopting similar policies that would positively impact women in their supply chains​.”

The report includes a look at the commitments made by Mars, Mondelēz International, and Nestlé around women’s economic empowerment in the cocoa sector and where those companies currently stand. All three companies made commitments from 2013-2016 to conduct gender assessments in key sourcing countries and ultimately action plans to address the unique issues women farmers face in cocoa growing regions.

The Oxfam spokesperson said: “We found that not all companies have met those commitments and that both the gender assessments and action plans vary significantly in terms of quality​.”

Agribusiness sector

Oxfam’s report found that overall, the agribusiness sector including cocoa suppliers Barry Callebaut, Cargill, and Olam continues to show a need for deeper policy commitments and implementation on key issues: “despite the overall increases and some notable policy commitments, the scores remain low​”.

The women, land and climate themes all saw the lowest average increases, indicating that pressure from customers has not moved the sector enough, Oxfam said. And the divide between the top performers and those at the bottom is widening.

Greater supply chain transparency, stronger incentives for suppliers to comply with standards and better regulation and accountability, can bring us significantly closer to a more inclusive, equitable and sustainable food system -- Helen Ripmeester, Oxfam America’s Associate Director of Inclusive Value Chains and Private Sector​

Oxfam’s four independent evaluations take an in-depth look at implementation efforts on:

•            Gender equality in cocoa value chains, assessing the completion and assess the completion and quality of the companies’ gender assessments and the resulting action plans.

•            The UN Women’s Empowerment Principles, assessing the extent to which companies that have signed on to the WEPs are taking action to foster gender equality and women’s economic inclusion.

•            Land rights, assessing the extent to which companies have integrated provisions on land rights into their supplier requirements and provided support mechanisms to encourage supplies to become complaint.

•            Climate change, examining the adoption of science-based emission reduction targets and shifting supplier policies and practices.

Oxfam said there is a clear need for the agribusiness sector to improve – and for the Behind the Brands companies – Mars, Mondelēz, Nestlé - to push them to do so.

“Without robust policies starting at the supplier level, commitments and actions from food and beverage companies risk losing credibility when it comes to delivering impact for the most vulnerable people in their supply chains​,” the report stated.

COVID-19

As COVID-19 exposes vulnerabilities in the global food system, the Oxfam report, ‘Shining a Spotlight​’ highlights the power of the world’s top 10  food and beverage companies to create more equitable and sustainable supply chains that can help lift millions of food producers out of poverty and fuel economies.

The comprehensive report assesses how companies have delivered on commitments made during Oxfam’s Behind the Brands campaign to implement stronger sourcing policies that impact climate change, land rights and women’s empowerment.

“Bold human and land rights commitments are a first step, but they are not reaching the very farmers and workers who are at once producing our food and struggling to stay afloat during a global pandemic and a climate in crisis,”​ said Helen Ripmeester, Oxfam America’s Associate Director of Inclusive Value Chains and Private Sector.

“Greater supply chain transparency, stronger incentives for suppliers to comply with standards and better regulation and accountability, can bring us significantly closer to a more inclusive, equitable and sustainable food system.”​

Oxfam’s Behind the Brands campaign which took place between 2013 to 2016 brought public pressure on the ‘Big 10’ — The Coca-Cola Company, Danone, General Mills, Kellogg, Mars, Mondelez, Nestlé, PepsiCo, Unilever, and Associated British Foods (ABF)—to improve their social and environmental policies. 

The new report analyses how the companies have performed on their commitments specifically in Brazil, Ghana, Guatemala, India, and Malawi over the past five years. The report finds that while companies have taken actions at the global level, progress stalls in translating those approaches to countries and through supply chains to reach farmers and workers.

“We get peanuts or nothing in return. At times we don’t even have enough money for sowing season. We are just surviving​,” says Pradeep, a sugar cane farmer in India who was interviewed for a related Oxfam study, the Human Cost of Sugar.

Climate change

On climate change, companies have been adopting robust climate targets and begun tracking agricultural emissions within their own supply chains over the last few years. Given that the food sector accounts for about 25%of global greenhouse gas emissions and small-scale farmers are increasingly being impacted by climate change, progress by these big actors is essential for ensuring a just transition in food systems to address the urgency of the climate crisis. But as the report finds, not all companies have kept pace with a 1.5°C global warming scenario and taking serious action on deforestation remains elusive.

On land rights, companies have made significant progress instituting policies at the headquarters level to protect communities at risk of losing their land to the production of sugar, palm and other ingredients. But implementation is uneven. Especially concerning is companies are rarely aware of where new, risky land acquisitions are taking place in their supply chains until it becomes a compliance issue, said Oxfam. Knowing where their suppliers are acquiring land – before an investment happens – would allow companies to implement policies that protect farmers and communities most at risk.

Women’s economic empowerment

On women’s economic empowerment, several companies have taken initial steps to foster gender equality and women’s economic inclusion specifically in the cocoa sector. Changes include new codes of conduct, parental leave practices, and social investment programs. But Oxfam found they’re often limited to headquarters or specific branches and fail to extend through the supply chain to factory workers, suppliers, and farmers where gender inequalities are more pronounced.

“Amassing a common voice by cocoa farmers is one significant means to ensuring farmers take part in setting the agenda for sustainable cocoa production​,” said Sandra Kwabea Sarkwah, Project Officer with SEND Ghana. “The current Ghana Civil society Cocoa platform with support from Oxfam Ghana has created a new space for collective idea sharing among farmers and civil society organizations at various levels​.”

Ultimately, as the report finds, for change to happen at scale, blockages must be addressed. Oxfam has called for a greater commitment to transparency that allows consumers and key stakeholders including farmers and communities affected by supply chains to understand which companies source from which suppliers and where.

Companies also must provide the right incentives for suppliers, especially large-scale agribusinesses to comply with policy commitments and take up the agenda for a more resilient global food system, the charity recommended.