Companies and civil society organisations oppose any calls to reopen the substance of the EU Deforestation Regulation, urges immediate release of guidance documents and FAQ

The undersigned companies and civil society organisations in the cocoa and chocolate sector have consistently supported the introduction of the EUDR. 

It is deeply disappointing that at the meeting of the Commission’s Multi-Stakeholder Platform on Protecting and Restoring the World’s Forests on 24 September, the Commission was unable to share or even announce the publication of the guidance and updated FAQ document that have been in preparation for months. This is jeopardising companies’ ability to implement the EUDR.

However, we strongly oppose the calls by some to reopen the substance of the EUDR for new negotiations. This would only serve to increase uncertainty and jeopardise the significant investments our member companies have made in preparing for its application. 

We call for the publication of the guidance and FAQ documents without further delay as a matter of urgency. We also call on the Commission, member states and the corporate sector to provide appropriate support for the implementation of the EUDR for smallholder farmers and their organisations so that the costs of compliance are not passed to them and they are not excluded from the EU market due to a lack of resources.

Companies: Ferrero, Mars Wrigley, Mondelēz International, Nestlé, Tony’s Chocolonely

Civil society and other organisations: Fairtrade International, Fair Trade Advocacy Office, International Cocoa Initiative, Rainforest Alliance, Solidaridad, VOICE Network

On International Coffee Day, a new alliance of civil society organisations in coffee releases their first report: “Coffee’s Regulatory Blend”. This report points to the benefits of the upcoming regulations in the coffee sectors, and urges the sector to catch up and step up on their compliance, rather than pushing back. It also calls on the EU to not bow to pressure to reopen the negotiations on the regulation, and provide support to smallholders. 

Mandatory sustainability regulations are becoming the new standard for global commodities, including coffee. This shift is not just necessary but overdue, and is vital for the sector’s future. The coffee industry’s response to this evolving regulatory environment has been inadequate. However, these regulations bring significant benefits for the planet, farmers, and coffee companies alike. They aim to curb deforestation, enhance human rights protections, and boost the credibility of sustainability claims. 

By mandating companies to address the living income needs of smallholders, these regulations make it clear that fighting farmer poverty is no longer a voluntary action. Additionally, the private sector stands to gain from a more harmonized and equitable marketplace, where all players must adhere to the same sustainability standards. The short-term costs of implementing sustainability measures are far outweighed by the risks of doing nothing and losing viable coffee-growing land due to environmental neglect or a waning appeal of coffee farming for future generations.

The coffee sector needs a clear understanding of the benefits of regulatory changes and the harms of maintaining business as usual. Embracing this new normal – where sustainability is no longer voluntary – is essential for the industry. Sustainability regulations are here to stay and will be a driving force in driving systemic sector transformation going forward. 

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VOICE is hiring a Finance and Administration Manager (0.4 FTE), based in the Netherlands (and optionally Belgium).

Job posting closes on June 12th. The vacancy can be read here.

The terminal market for cocoa is currently trending at around $10,000 a tonne. This is way higher than the low trending prices of the past decades. Why is the price so high? Are farmers earning from this? What should happen?

We try to answer a few of these questions with this non-paper, which the VOICE secretariat drafted for our membership. If you are a cocoa expert and believe data is missing, feel that points need to be challenged, etc, please reach out to us. We like to be a learning organisation, and our opinions change based on new information, so please do reach out to us. This document is a work in progress, and will likely be amended regularly in the coming months.

The Cocoa Coalition has consistently supported the proposed EU Directive on Corporate Sustainability Due Diligence. We believe that it represents an important step forward in driving the necessary transformation of the cocoa and chocolate sector and in making human rights and environmental due diligence the norm in global value chains. We called for EU-wide due diligence legislation in the first position paper we published, in 2019.

Accordingly, we urge support for finalising the text of the Directive as soon as possible and before the end of the current EU legislative term. Failure to do so would undermine the position of those companies aiming to put in place systems that protect human and labour rights and the environment. It would risk the emergence of a patchwork of national legislation in EU member states, increasing compliance costs without any benefit to the sector or consumers. This would be a major setback to sustainability in global supply chains.

The Cocoa Coalition comprises companies (Ferrero, The Hershey Company, Mars Wrigley, Mondelēz International, Nestlé, Tony’s Chocolonely, Unilever), NGOs (Fairtrade International, Fair Trade Advocacy Office, Rainforest Alliance, Solidaridad, VOICE Network) and multi-stakeholder organisations (International Cocoa Initiative).

The full statement with logo’s can be downloaded here.

On 19 February 2024, Italian company Ferrero, jointly with industry peers like Mars and Mondelēz, urged the Italian Government to support the adoption of the Corporate Sustainability Due Diligence Directive (CSDDD) at EU level. The call was joined by leading civil society actors active in the cocoa sector and on deforestation.

The statement welcomes the carefully negotiated text and recalls that over the last years many voices from business have “called for the introduction of pragmatic, consistent and uniform legislation at the EU level and therefore welcome the text of the directive provisionally approved by the Council and the European Parliament.

The new agreement, reached by the EU institutions in December 2023, reflects a careful and pragmatic balance between countries’ resolute commitment to protecting human rights and sustainability and the need for caution in imposing new obligations on a sector that is already facing uncertainty and complexity in the global marketplace.

The obligations in the directive ensure a high level of alignment with the internationally recognised standards on due diligence. The harmonisation proposal will provide common standards, instead of regulatory fragmentation that would only bring uncertainty and complexity, including for Italian companies.” [unofficial translation from Italian]

The full statement in Italian including signatory logos can be found here.

Join us as we gather for a day of building knowledge, strategy, and relationships with civil society and farmers from across the globe.

Are you attending Amsterdam Cocoa Week (or happen to be in the neighbourhood) and working for an NGO or union in the cocoa sector, or are you (representing) a cocoa farmer?

The VOICE Network is happy to invite you to a global Civil Society and Farmer Based Organisation meeting in Amsterdam on the 5th of February, ahead of the World Cocoa Foundation WCF partnership meetings and Chocoa (6-10 Feb). This  in-person gathering during Amsterdam Cocoa Week is aimed to bring together representatives around the world to discuss key issues in cocoa. Coffee and lunch will be provided and we will foresee interpretation in the three main cocoa languages, English, French and Spanish.

Register here.

The Cocoa Coalition of companies, NGOs, certification organisations and multi-stakeholder organisations welcomes the conclusion of a political agreement on the EU Corporate Sustainability Due Diligence Directive (CSDDD). We believe that it represents an important step forward in driving the necessary transformation of the cocoa and chocolate sector, and in making due diligence the norm in global value chains.

As this Coalition has previously stated, it is crucial that the Directive is supported by guidance, including on what companies are accountable for, and accompanying measures, especially to support upstream economic actors and vulnerable stakeholders in global value chains. We call on the European Commission to start this work without further delay and engage with relevant stakeholders throughout the process.

[Note: the Cocoa Coalition comprises companies (Ferrero, The Hershey Company, Mars Wrigley, Mondelēz International, Nestle, Tony’s Chocolonely), certification organisations (Fairtrade International, Rainforest Alliance), NGOs (Fair Trade Advocacy Office, Solidaridad, VOICE Network) and multi-stakeholder organisations (International Cocoa Initiative).]

launch webinar december 5th 14:00 cet

What are principles and steps that cocoa and chocolate companies should take to ensure the way they do their core business is sustainable? The Cocoa Barometer Consortium is publishing a consultation paper to outline what good purchasing practices could and should look like in cocoa.

Join us for an online launch webinar, including a presentation of the key findings and a panel discussion, on December 5th, from 14:00-16:00 CET. This webinar will be in English and French with simultaneous interpretation.

Register for the webinar here.

The world market price for cocoa is at an all-time high due to poor harvests. Over the past weeks, reports have surfaced in the media of large companies actively trying to reduce the world market price. Ivorian and Ghanaian farmer-based and civil society organisations have responded in this joint statement last week. Attached (also in French) and below are the thoughts of the members of the VOICE network.

Over recent years, chocolate manufacturers have enjoyed record profits, whilst the vast majority of the farmers at the base of their cocoa supply chains have been unable to meet the basic needs of their families due to low cocoa prices and unfair contract terms. During recent weeks, supply shortages caused by a low harvest have seen cocoa prices climb steadily upwards, offering some hope that small-scale growers in West Africa, where most of the world’s cocoa originates, could begin to reap greater rewards for their labour.

Instead, the companies supplying major chocolate brands have refused to buy cocoa at the increased market prices, claiming that doing so would “create too much risk” for them, if the chocolate companies refuse to pay the asking price down the line.

Clearly, there is a double standard at play. When prices are low, cocoa companies claim “you can’t interfere with the market”. But suddenly, when prices are high, they want intervention in the market. This position is untenable.

Though higher farm gate prices are only part of what’s required to ensure cocoa growers earn a living income, they are a key prerequisite. There is not a business case for higher productivity if prices for farmers are too low and their risks too high. But that has been the stark reality for a very long time now. Farmers cannot simply grow their way out of poverty. But that has been the industry’s flawed approach to poverty alleviation.

Smallholder cocoa farmers do not have the capacity to avoid risk – risks of prices falling due to windfall harvests, or risks of crops failing due to weather or pests and diseases. They absorb the full brunt when prices are low.^[1] And even when prices are high, they hardly benefit, as prices are only high when harvests are bad.

Furthermore, in the two major cocoa producing countries of Ghana and Côte d’Ivoire, the forward sales system means that farmers are not receiving the currently high market prices in any case. Most of the cocoa harvested at the start of the new season on 1 October 2023 was sold already last winter/spring when prices were much lower.

Meanwhile, the large cocoa and chocolate companies continue to make hundreds of millions in profits every year. Companies can do so precisely because they can push risk further upwards in the supply chain – basically saying that the risk is not their problem, but the problem of their supplier – and because they can hedge their risks on the terminal markets.

It is clear who ‘can’t afford’ low prices: cocoa farming households, the vast majority of which live far below a living income line. The same families bear almost all of the risk in the sector.

This current market dynamic should be a wake-up call to everyone about the current system of ‘price discovery’, which benefits the most powerful actors in the supply chain and makes the weakest actors compete with each other.

Farmers cannot win in the current situation.

Virtually all large cocoa and chocolate companies either individually or collectively^[2] have committed to ensuring the farmers in their supply chain earn a living income. Yet just when the price is getting closer to what would be necessary for this to be possible, these same companies turn around and try to push the prices back down again.

These companies are not just the traders – who are directly engaged in the present standoff – but also the chocolate manufacturers and supermarkets, who make the vast majority of the profits in the supply chain and who are also refusing to buy cocoa unless the price is discounted.

Companies engaging in this behaviour are guilty of hypocrisy of the highest order.

As the VOICE Network, we call on companies to:

• In the short term, buy their usual volumes of cocoa at the current market price instead of trying to force the origin governments to lower the price by delaying their purchases or by reducing country differentials (as they are currently doing)
• In the medium term, adopt purchasing practices that enable farmers to earn a living income, including paying a Living Income Reference Price and negotiating long-term asymmetric contracts with small farmer suppliers where the companies start to assume a more equitable portion of the risk.

We call on producer governments to

• Provide transparency on current sales prices – including country differentials and
• Provide transparency about management of the Living Income Differential

We also call to the European Union To ensure that the implementation of the Deforestation Regulation (EUDR) and Corporate Sustainability Due Diligence Directive (CSDDD) ensures a living income for producers and requires companies to adjust their purchasing practices accordingly.

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^[1] The 2022 Cocoa Barometer, as well as the Living Income Compendium of September last year, clearly argue that the business case for Good Agricultural Practices builds upon a conducive enabling environment, which requires governments to ensure good policies are in place, and which requires companies to ensure they are conducting Good Purchasing Practices. A more detailed perspective on these purchasing practices will be available in our forthcoming consultation paper, to be released early December.

^[2] All of the five national Initiatives for Sustainable Cocoa (ISCOs) in Europe, of which all the major cocoa and chocolate multinationals are members, have commitments to achieve a living income. Furthermore, all major cocoa and chocolate companies have signed the Economic Pact with Côte d’Ivoire and Ghana, committing to paying the Living Income Differential.