Cocoa

Our commitment: Roll out the Nestlé Cocoa Plan with cocoa farmers



Our commitment: Roll out the Nestlé Cocoa Plan with cocoa farmers

We buy around 414 000 tonnes of cocoa, mainly for chocolate and confectionery but also for other products such as beverages. Our supplies come from major cocoa-growing countries including Côte d’Ivoire, Ghana, Brazil, Ecuador, Venezuela, Mexico and Indonesia. We buy beans as well as processed cocoa.

Our latest report

Our progress in tackling child labour is detailed in a report produced and published in October 2017 by the International Cocoa Initiative and Nestlé. It provides the first comprehensive assessment to date of the successes and the challenges remaining in ending child labour in cocoa.




Cocoa supply chain challenges and solutions

The majority of cocoa farmers are smallholders with low productivity and incomes, living in poor communities, with depleted soils and older, less productive trees. They often resort to using their children for tasks that could be harmful to their physical or mental development and are therefore classified as child labour. Women in the cocoa supply chain are often under-rewarded for their work, or not given a voice in their communities.

The Nestlé Cocoa Plan vision is to improve the lives of farmers in our cocoa supply chain.

The Plan operates across three key pillars:

  • Better farming, addressing issues such as agricultural practices and rejuvenation of plantations;
  • Better lives, which seeks to empower women and eliminate child labour; and
  • Better cocoa, which covers certification and building long-term relationships in our supply chain.

Underlying all these activities is transparency and partnerships. In 2016 we continued our work within the World Cocoa Foundation’s CocoaAction, the industry strategy for cocoa sustainability. We developed our relationship with UTZ to extend their work from certification to field key performance indicator (KPI) collection, and began a partnership with Jacobs Foundation to add literacy training to our child labour work.

The Nestlé Cocoa Plan has been evolving since its inception in 2009 and this continues with CocoaAction, helping us focus on impacts and initiate community development programmes. This year we will start to report on the outcomes and impact of the Nestlé Cocoa Plan, along the lines of CocoaAction KPIs and reporting. We will develop and improve this reporting as we have more data in the coming years.

Our objective in 2016

By 2016: Source 130 000 tonnes of cocoa through the Plan and complete the rollout of our Child Labour Monitoring and Remediation System (CLMRS) to identify child labour in all Nestlé Cocoa Plan co‑operatives in Côte d’Ivoire.

Better farming

Activity KPIs Country Unit 2015 2016
Number of high-yield plantlets distributed Global Number 1.71m 2.2m
Farmers trained Global Number 44 617 57 000
Outcome indicators:        
Average yield per hectare (Côte d’Ivoire) Côte d’Ivoire Tonnes/ha n/a 0.6
% of farmers applying good agricultural practices Côte d’Ivoire % n/a 31%

Plant distribution exceeded our target, thanks in part to better access to seeds, especially in Ghana, due to cooperation through CocoaAction with the Ghana Cocoa Board. This also ensured we remain on track to achieve our 10-year commitment on plant distribution. We have initiated reporting on yield and application of good agricultural practices.

Better lives

Our roll-out of the Child Labour Monitoring and Remediation System (CLMRS) continued as planned, with all 69 co-ops registered in the Cocoa Plan at September being in the CLMRS by the end of the year. The CLMRS now covers 37 130 farmers. The roll-out will continue in 2017, with all new co-ops in the Nestlé Cocoa Plan being in the CLMRS within a year. We also began to set up the system in Ghana in 2016, with initial results next year. The impact of the CLMRS is also increasing with the addition of literacy training to the support offered to farmers and communities, partly funded by the Jacobs Foundation. In 2016 we tightened up the definition of ‘child labour cases no longer in child labour’, which now requires at least two visits from the community liaison person over a six-month period. The number is low due to this redefinition, and an area of focus for us in 2017 will be to follow up many of the children we have helped and evaluate how well it is working.

The CLMRS is only sustainable if the farmer organisations can continue to drive the work using the premium they receive from the cocoa. Ensuring this transfer of responsibility has been a particular challenge and will be a focus of our effort during 2017.

The Fair Labor Association (FLA) continued its annual auditing of our Côte d’Ivoire supply chain, and its report can be found on the FLA website.

We were very disappointed not to build more schools in 2016. Our plans were delayed while we reconfigured the tendering procedure and our partner brought more technical expertise on board. We intend to get back on track in 2017. School construction is guided by need identified by the CLMRS and government education plans.

We continued our work to empower women in 2016. In Côte d’Ivoire, we supported 1073 women to develop income-generating activities, while the percentage of women in leadership positions in Côte d’Ivoire, Ghana, Ecuador and Indonesia is now 8.9%.

Activity KPIs Country Unit 2015 2016
Number of co-ops in CLMRS Côte d’Ivoire Number 40 69
Number of farmers covered by CLMRS Côte d’Ivoire Number 24 470 37 130
Farmers and community members who attended awareness-raising sessions Côte d’Ivoire Number 120 067 193 424
Number of women supported to carry out an income-generating activity Côte d’Ivoire Number 1 311 1 073
Cumulative total of schools built Côte d’Ivoire Number 42 42
Outcome indicators:        
% of women in leadership positions Côte d’Ivoire, Ghana, Indonesia, Ecuador % n/a 8.9%
Number and % of children participating in child labour Côte d’Ivoire Number, % 5 135, 19% 5 891, 16%
Number and % of child labour cases followed up and/or assisted Côte d’Ivoire Number, % 3 591, 69.9% 4 680, 79%
Number and % of child labour cases no longer in child labour Côte d’Ivoire Number, % n/a, n/a 82, 1.4%

Better cocoa

Activity KPIs Country Unit 2015 2016
Volume of Nestlé Cocoa Plan cocoa Global Tonnes 121 481 140 933
Nestlé Cocoa Plan cocoa as % of total Nestlé cocoa Global % 30% 34%

In 2016 we continued to increase the amount of cocoa purchased through the Nestlé Cocoa Plan, exceeding our target despite drought affecting crops in West Africa and Brazil, and supplier financing issues. Our KitKat brand became the first global confectionery brand to be sourced from 100% certified cocoa. Our plan is to continue to increase the Nestlé Cocoa Plan to 150 000 tonnes in 2017, 175 000 in 2018 and 230 000 tonnes by 2020. A high proportion of this cocoa was sourced from farms and plantations that meet the UTZ certification Code of Conduct for Cocoa standard, one of the largest sustainability programmes for coffee, cocoa and tea, and the Fairtrade certification standard.

The Nestlé Cocoa Plan cost around CHF 30 million in 2016, broken down as follows:

Nestlé Cocoa Plan costs 000 CHF
Cocoa research and development, and plant distribution 3 245
Membership and global projects 1 617
Nestlé Cocoa Plan projects 678
CLMRS and school building 5 516
Farmer cash premium 7 068
Co-op premium, certification, training and other costs 12 135
Total 30 259

Giving women a voice in Côte d’Ivoire

Working with the Fair Labor Association, we’ve established women’s fora in two cocoa-growing communities in Côte d’Ivoire: Yaokouakoukro and Zaranou. These platforms will give the women a voice in their communities, and the opportunity to have grievances addressed.

A Social Impact Assessment in the communities found that women’s participation in community affairs was limited, their inclusion in decision-making linked to their economic status, and that women often felt more comfortable using informal grievance structures than existing groups.

Following work with two women’s associations to build confidence and economic capacity, in May 2016 we trained women in effective dialogue and grievance-handling mechanisms. Women representatives on the fora were selected by the existing associations. The fora also gave women a clear path to obtain advice when needed.

High illiteracy rates in the communities meant that training materials and techniques needed to be designed to suit the participants. This led to a strong focus on participatory activities such as role plays and simulations. In all, 108 women from Zaranou and 67 from Yaokouakoukro participated.


Looking ahead

Our objectives towards 2020

By 2017: Source 150 000 tonnes of cocoa through the Nestlé Cocoa Plan. Ongoing: All co-ops will adopt the CLMRS within a year of joining the Nestlé Cocoa Plan.

By 2018: Source 175 000 tonnes of cocoa through the Nestlé Cocoa Plan.

By 2020: Source 230 000 tonnes of cocoa through the Nestlé Cocoa Plan.

This year we are starting to report on the outcomes and impact of the Nestlé Cocoa Plan, along the lines of CocoaAction KPIs and reporting. We will develop and improve this reporting as we obtain more data in the coming years.

The roll-out of our CLMRS will continue in 2017, with all new co-ops in the Nestlé Cocoa Plan being in the CLMRS within a year. We will also continue extending the system in Ghana, and publish initial results. The impact of the CLMRS is also increasing, with the addition of literacy training to the support offered to farmers and communities.


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