The Human and Economic Costs of Big Chocolate

What's the story?

• An Oxfam report found that chocolate corporations' sustainability programs are failing to deliver on promises to protect the environment and pay farmers a living wage.  

Corporate profits: The big picture

• The world's four largest public chocolate corporations — Hershey, Lindt, Mondelēz, and Nestlé — made nearly $15 billion in profits from their confectionary divisions, up 16% since 2020.
• The big four paid out more than their total net profits (113%) to shareholders between 2020 and 2022.
• The families who own Mars and Ferrero, the two biggest private chocolate corporations, have seen their fortunes rise by $39 billion since 2020. They currently have a combined net worth of approximately $157 billion.

Workers stuck in poverty

• Oxfam surveyed over 400 Ghanaian cocoa farmers who supply the big name brands and found that during that same time period, their incomes fell by an average of 16%. Women's incomes fell by 22%.
• Out of 800,000 chocolate farmers, 90% live under the poverty line and said they were doing measurably worse after the pandemic.
• Ghana and the Ivory Coast produce 70% of the world's cocoa beans while bearing the human and environmental costs of the industry. 
• There have been reports of farmers using child labor to reduce costs and remain competitive. Children are sold by traffickers to cocoa farmers or even kidnapped from poor villages. The Supreme Court case Nestlé USA and Cargill v. Doe shed light on six plaintiffs' plight: they were trafficked from Mali into the Ivory Coast as children and forced to labor on cocoa farms. The Court ruled in favor of the chocolate corporations.
• Amitabh Behar of Oxfam said:

"There's big money in chocolate —but definitely not for farmers. Cocoa farmers work extremely hard, under grueling conditions, yet can't always feed their families."

Environmental impacts

• It is estimated that 70% of the illegal deforestation in the Ivory Coast is due to cocoa farming. Less than 4% of the country remains covered in rainforest.
• An investigation by Mighty Earth found that some of the biggest names in chocolate knowingly purchase cocoa grown in illegally deforested national parks in West Africa. 
• In the Ivory Coast, only 100-400 elephants remain from a previous population numbering in the hundreds of thousands.

Unfulfilled promises

• In 2017, Hershey vowed to source 100% certified sustainable cocoa by 2020, a promise that was not fulfilled.
• Oxfam found that none of the sustainability programs of the 10 manufacturers they analyzed had achieved their goal of increasing cocoa production and, in tandem, boosting farmer income.
• They found that the small premiums paid to farmers on top of their selling price did not make any meaningful dent in the farmers' low incomes. 
• Chocolate corporations make vague promises about ending child labor and promoting the environment. In 2001, major companies signed a deal called the Harkin-Engel Protocol, pledging to end "the worst forms of child labor" in the supply chain. They missed the deadline three times before reducing the scope of their goals.
• Behar said:

"[Chocolate giants] must rid themselves of their colonial legacy of extracting raw materials and keeping farmers in poverty while making astronomical profits for their rich shareholders. Without fair pricing and living incomes there will never be such a thing as 'sustainable' or 'exploitation-free' chocolate."

Will you think twice about dessert?

—Emma Kansiz 

(Photo credit: iStock/ALEAIMAGE)