Child Labour in COCOA Industry: Corporate Social responsibility Initiatives

Presented by: Anushree Kasat Ankit Gakhar Ankur Pandey Miti Bakshi Shainel Jain Sashikant Mishra Stephen Rodrigues

Child labor
Refers to the employment of children who are under 18 in any work that deprives children of their childhood, interferes with their ability to attend regular school, and that is mentally, physically, socially or morally dangerous and harmful. This practice is considered exploitative by many international organizations. Legislations across the world prohibit child labor. In developing countries, with high poverty and poor schooling opportunities, child labor is still prevalent. Poverty and lack of schools are considered as the primary cause of child labour.

Cont.
In 2010, sub-saharan Africahad the highest incidence rates of child labor, with several African nations witnessing over 50 percent of children aged 514 working. Worldwide agriculture is the largest employer of child labour. Vast majority of child labour is found in rural settings and informal urban economy; children are predominantly employed by their parents, rather than factories. The incidence of child labour in the world decreased from 25% to 10% between 1960 and 2003, according to the World Bank.

What is Maple Croft

Maple crofts Global Risks Portfolio and services combine rigorous research with technological innovation to offer risk screens, monitoring tools and invaluable insights into the most challenging political, economic, social and environmental risks and responsibilities facing global business today.

Maplecroft 2012 Child labour Facts

Maplecroft Child Labour Index 2012 survey reports 76 countries pose extreme child labour complicity risks for companies operating worldwide. The ten highest risk countries in 2012, ranked in decreasing order, were: Myanmar, North Korea, Somalia, Sudan, DR Congo, Zimbabwe, Afghanistan, Burundi, Pakistan and Ethiopia. Of the major growth economies, Maplecroft ranked Philippines 25th riskiest, India 27th, China 36th, Viet Nam 37th, Indonesia 46th, and Brazil 54th - all of them rated to involve extreme risks of child labour uncertainties, to corporations seeking to invest in developing world and import products from emerging markets

More Facts on cocoa and child labour

The EU grinds and consumes around 40% of world's cocoa. Harvesting cocoa is labour-intensive. Over 90% of the world's cocoa is grown by 5.5 million smallholders. A further 14 million rural workers directly depend on its production. The International Labour Organisation (ILO) estimates that over 215 million children worldwide are used as child labourers.

Cont
MEPs have called for a ban on child labour in trade and the possible introduction of "child labour free" product labelling in the past
In December 2011, Parliament withheld its consent to a Textile Protocol to the EU-Uzbekistan Partnership and Cooperation Agreement due to proof that forced child labour had been used in Uzbekistan's cotton fields

The largest cocoa bean-producing countries in the world are as follows.

Country Amount produced Percentage of world production

Cte d'Ivoire
Ghana Indonesia Cameroon Nigeria

1.23 million tons

730 thousand tons 490 thousand tons 210 thousand tons 210 thousand tons

34.7%
20.6% 13.8% 5.9% 5.9%

Brazil
Ecuador Malaysia

165 thousand tons

130 thousand tons 32 thousand tons

4.7%
3.7% 0.9%

Child Labor By Country: Maplecroft 2012 Index Ranks Risk Of Violations

Facts of 2012 : http://www.childinfo.org/labour.html

Child Labour In Cocoa Production In West Africa

Cocoa production is mostly done by small farms with only 20% by large corporations. West Africa makes up 70% of the Worlds cocoa bean production Nigeria, Ghana, Cte d'Ivoire and Cameroon are major producer & exporter. Cte d'Ivoire in particular, supplies 35 percent of the world's cocoa and is worlds biggest producer too. Family labor involved in cocoa production and child labor forms a part of it.

Child Labor
On these farms, about 284,000 children were said to be working in hazardous cocoa harvesting conditions such as clearing ground; weeding; maintaining cocoa trees; applying pesticides; spreading fertilizer; harvesting; piling/gathering up; pod breaking; fermenting; transporting; drying; and other activities Only 1/3 of children 6-17 years old in these regions go to school, the rest farm.

Cont.
Even with the entire family working, farmers only receive $30-$205 annual income. Child workers were forced to work 80-100 hours per week. Child trafficking done by the dealers. They charge 15,00020000 FCFA for transport of these children and at the time of the season 1,00,000 1,50,000 FCFA

Reason for child labor

Poverty Exploitation MNCs pressure Illiteracy Low government intervention.

Supply Chain of COCOA industry

Coco farmers sell cocoa @ 1

euro/kg to local traders

Local traders cleans and washes and sells to the national exporter @2.5 euro/kg National exporter sells it to

MNCs @4 euro /kg

1 kg = 40 bars of chocolate 1 chocolate= 20 euro

FAIR TRADE
An International monitoring and certification system. Fair Trade means that the farmers : Receive a sufficient price. Do not use abusive child labor or forced labor. Use sustainable farming methods. Further, it also brings the cocoa producers and buyers together, eliminating the middlemen.

Originally the aim was self-development of the producers, gradually the objective became guarantee against exploitation.

CONT..
The Fair trade foundation certifies and promotes Fair Trade. Set up in 1990s by agencies including cafod, Oxfam, tradecraft exchange,etc. The first fairtrade product was launched in 1994 in UK. Fair trade products bear the transFair USA

Fair Trade certified labels.

Foods carrying Fairtrade mark were sold17 countries 235 traders and 452 companies 360 producer groups in 40 countries.

Facts about Fair Trade and the Cocoa Industry

Chocolate - Cocoa Beans Pods. Cocoa pod has 50 beans. 400 beans make 1 pound of chocolate. About 3.5 million tones of cocoa beans are produced each year. 14 million rural workers directly depends on cocoa for their live hoods. US buys more coffee than any other country. Around 1,22,000 farmers - 62 producer organization -18 countries benefits from supplying Fairtrade cocoa. Sales through fair trade give farmers twice as much as sales that arent through fair trade. Fair trade cocoa system involves more then 42000 farmers from 9 countries.

WHY FAIR TRADE WAS NEEDED

Inadequate Infrastructure. Poor Education. Food Insecurity. Lack of technical support. Rising farm costs. Climate Change. Poor market Information. Falling income in real terms.

How global sales of fairtrade cocoa have grown

(In tonnes)
40000 35000 30000 25000 20000 15000 10000 Series

5000
0

Other Initiatives
In 2003 WACAP was launched by ILO/IPEC. IN 2004 WCF signed an agreement with winrock international,(a non governmental org.) vocational education. The project estimated 1200 children's. The Protocol - no substantial progress. It addresses the symptoms of child slavery but not the causes the pricing system for cocoa.

WHEN U BUY FAIR TRADE Farmers can afford food and doctors can visit for their families. Kids can go to school instead of working Your food will always be as sweet for farmers as it is for u

The Unfulfilled promises of the cocoa industry

Cocoa and Chocolate industry commitments
1) Industry develop and implement credible, mutuallyacceptable,voluntary,industry wide standards of public certification 01st July 2005. 2) The BCG programme recommendation- submission to joint foundation July 2003. 3) The BCG collect information evaluate information exchange programme. 4) BCG develop programme addressing worst forms of child labor. 5) The BCG develop program options submit to joint foundation (No date).

Actual Activities to date

1)

Guiding principles were agreed including : African Government participation in monitoring process. Independent means of verification. Transparency and accountability.

2) No programme submitted now called International cocoa initiative(ICI).

3) The ICI Appears take role lieu of the BCG. 4) The responsibility delegated to ICI. 5) ICI staff delegated this responsibility.

CHILD LABOUR IS NEVER ACCEPTABLE

There shall be no new recruitment of child labour. Companies shall develop or participate in and contribute to policies and programmes which provide for the transition of any child found to be performing child labour to enable her or him to attend and remain in quality education until no longer a child; "child" and "child labour" being defined in the appendices. Children and young persons under 18 shall not be employed at night or in hazardous conditions.

Areas of Ethical Concern

Healthy and Adequate Nutrition : Suffer from acute malnutrition due to famines, with many more suffering from chronic malnutrition. Access to Education : Adversely impact childrens access to education Impact of Climate : Working in hot and humid climate affects the health of children. Alcohol, Tobacco, and Gambling : Poor adult health resulting from alcohol or drug abuse has a particularly negative impact on children. Risks to Child Safety

Independent Ethical Certification as a Solution

Ethical Certification Gathering Pace : The emergence of ethical
certification for cocoa via credible, independent voluntary standards systems, reflects how these approaches offer frameworks for producer, industry, development NGOs and governments to collaborate on solving labour exploitation and cocoa sustainability challenges.

THANK YOU