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The Valentine’s Day pressure is on. What gift will you choose to express your love to your sweetheart? Chocolate, roses and jewelry usually top the list of options—and the National Retail Federation projects that spending for Valentine's Day will top $20 billion this year. Jewelry captures nearly one quarter of that figure, with the rest spent on a variety of gifts, including 1 billion cards, 58 million pounds of chocolate and 110 million roses.
Global supply chains need greater transparency
But there’s a sinister secret on the store shelves: Many of the most popular Valentine’s Day gifts may be made with forced labor and child labor. While Ecuador has made strides in reducing child labor, the U.S. Bureau of International Labor Affairs notes that child labor still occurs in flower cultivation and harvesting, as well as in gold mining. Likewise, the Bureau says Colombia has done well at eradicating child labor from the rose industry, but still has child labor and forced labor in cocoa, emeralds and gold. Another hotspot, Sierra Leone, has child labor in supply chains for cocoa, diamonds and palm oil (often used in candles—another romantic gift).
A closer look at the chocolate supply chain
Organizations like Stop the Traffik have made it their role to inform the consumer of the unethical practices and the use of child labor. And consumer awareness is improving. The impact of an informed consumer and the changes to their spending patterns cannot be underestimated. Nielsen's "What's Sustainability Got To Do With It" report reveals sustainable chocolate sales growth of 16 percent in 2017, while overall category sales growth was 5 percent.
Consumer expectations for companies are shifting too. The 2017 Cone Communications CSR Study found that 86 percent of U.S. consumers expect companies to act on social and environmental issues. In addition, asset managers and investors increasingly expect companies to address environmental, social and governance (ESG) factors to support long-term, sustainable growth.
Governments, too, are working to address the issue of forced labor. Companies worldwide are under pressure to act following a commitment by world leaders at the 2017 G20 summit to take “immediate and effective measures” to eliminate child labor by 2025.
Chocolate companies hear the call to end forced labor
At the One Young World Summit, also held in 2017, Antoine de Saint-Affrique, CEO of Barry Callebaut (the firm is one of the world’s largest manufacturers of chocolate) said:
“Business cannot prosper if the society in which the business is, does not prosper. The fate of one is linked to the other. I am convinced that our company can and should contribute to fighting poverty in a way that has nothing to do with charity but in a way that makes good business sense, because when things make good business sense they tend to happen faster and they tend to be sustainable over time.”
“The cocoa farmers from which we buy, for the large part, live in poverty. The kids are made to work in the field and this has threatened their health and prevented a number of them from going to school. You cannot simply turn a blind eye to this for obvious moral reasons, but if you don’t believe in moral reasons you cannot either for very practical reasons.”
“If farmers do not earn a living, they will keep clearing tropical forest for new farmland. There will be no forest left, there will be no rain for the crop. If farmers cannot earn a living, they will simply not replant cocoa trees and eventually there will be no cocoa trees and therefore no chocolate.”
Business cannot prosper if the society in which the business is, does not prosper.
The fate of one is linked to the other.
Many of the biggest chocolate companies agree. In its March 2018 publication, “A Matter of Taste,” StopTheTraffik noted that Nestlé is leading the way in terms of transparency about its cocoa supply chain. The report notes, “In 2012, Nestlé became the first major chocolate company to start implementing a child labor monitoring and remediation system, considered par excellence within the industry.”
Hershey has tackled sustainable, ethical business practices as well. The company set a goal of 100 percent certified and sustainable cocoa sourcing by 2020 and has already hit the 60 percent mark toward that goal. Hershey has also expanded its Hershey Learn to Grow agricultural training programs which it says, “… help build healthy, productive communities through education, women’s empowerment and policies designed to prevent illegal and forced child labor in the company’s supply chain.”
The best news about the shifting attitudes is that it isn’t exclusive to chocolate. Just last month, Tiffany & Co. announced that it will clearly display the provenance of registered diamonds and it is “committing to 100% geographic transparency for every newly sourced, individually registered diamond, and will not source any diamonds with unknown provenance (even if responsible sourcing is assured) moving forward.” And beginning in 2020, Tiffany’s will include a diamond’s “craftsmanship journey” in addition to its provenance.
Putting the right risk mitigation processes in place
The importance of due diligence and ongoing risk monitoring to support more transparent supply chains should be a top priority for companies. Risks can surface at any supplier level and have negative consequences for the dominant brand. However, by fostering more transparent relationships with its suppliers, the dominant brand can embed best practices and standards throughout the supply chain.
So, before you make your Valentine’s Day gift decision, do a little research. Recognizing the potential dark side of the gifts we give—be it a box of chocolates or a little bling—and choosing brands committed to ethical sourcing will help reduce the exploitation of people and the environment. And that’s a Valentine’s Day gift that keeps on giving.
3 Steps to Take Now