A group of shareholders is urging major chocolate companies, including Hershey and Lindt & Sprüngli, to increase wages for cocoa farmers within their supply chains.
Issued yesterday (May 20) by the non-profit Investor Advocates for Social Justice (IASJ), the letter calls on some of the world’s largest chocolate manufacturers to “end exploitative purchasing practices,” especially in Ghana and Côte d’Ivoire.
Directed also at Ferrero, Mars, Mondelez International, and Nestlé, the letter demands that these companies ensure all cocoa farmers earn a “living income” by the end of 2025. It also calls for long-term contracts to support “cocoa farmer resilience and security.”
According to the IASJ, increasing farmer incomes addresses the “root cause” of child labor and ensures the stability of the cocoa sector by preventing farmers from abandoning cocoa farming for better-paying opportunities.
In April, a report on Nestlé’s income accelerator for cocoa farmers in Côte d’Ivoire showed improvements in pay but noted that it still fell short of a living income benchmark.
The IASJ asserts that chocolate producers have “repeatedly deflected investors’ requests to ensure higher farmgate prices for cocoa farmers,” blaming the governments of Ghana and Côte d’Ivoire, which set cocoa prices. However, the investors argue that companies can still “pay sustainability premiums on top of the government-set price, which are received directly by cocoa farmers.”
IASJ program director Aaron Acosta stated, “We’re calling on chocolate companies to use their purchasing power, through price interventions, to ensure cocoa farmers receive a living income. Given their size and influence, chocolate companies are uniquely positioned to address systemic poverty by ensuring cocoa farmers receive a living income.”
Recently, both Ghana and Côte d’Ivoire, the largest cocoa producers globally, have raised their farmgate prices for cocoa. Cocoa futures have also reached record highs this year due to global supply pressures from crop disease and poor weather. Confectioners have cited new regulations, such as the EU’s planned deforestation laws, and market speculation as factors driving up prices.
Just Food reached out to Ferrero, Hershey, Lindt, Mars, Mondelez, and Nestlé for comments.
A Nestlé spokesperson responded, “We believe cocoa farmers should earn an income that enables them to maintain a decent and adequate standard of living for themselves and their families.” The spokesperson highlighted Nestlé’s income accelerator program, stating that it “is helping cocoa farmers substantially improve cocoa productivity as well as increase their net income.” They added that financial incentives are provided in addition to the support and premiums from the governments of Côte d’Ivoire and Ghana.
The other companies had not responded to Just Food’s requests for comment at the time of writing.
“Investors call on chocolate giants to boost cocoa farmers’ wages” was originally created and published by Just Food, a GlobalData owned brand.
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