EU’s Momentum for Achieving a Responsible Cocoa Sector

The vision of the World Cocoa Foundation is “a sustainable and thriving cocoa sector, where farmers prosper, cocoa-growing communities are empowered, human rights are respected, and the environment is conserved.” This is an excellent vision. I have worked my whole political career in defending and advocating human rights. Past years I have more and more focused on the Business and Human Rights. The question is, how can we best encourage, empower and sometimes even oblige the private sector to engage in human rights and sustainability. Your vision tells me that I don’t need to convince you that human rights and sustainability are important.

Momentum in the EU

I am convinced that the EU’s momentum for achieving a responsible cocoa sector is at hand. We are in the beginning of a new legislature: the European Parliament mandate and soon also the European Commission mandate. The omens for responsible and sustainable cocoa, and to responsible and sustainable cocoa have never looked this good:

The big picture is that Ursula von der Leyen, President-elect of the European Commission, raised the United Nations Sustainable Development Goals high on the EU agenda: Each Commissioner is responsible to ensure the delivery of the United Nations Sustainable Development Goals within their policy area and the College as a whole will be responsible for the overall implementation of the Goals.

The European Parliament raised the issue of responsible and sustainable supply chains and the due diligence legislation in the Commissioner hearings, when appointed EU commissioners appeared in front of the Parliament. Justice Commissioner Reynders, Trade Commissioner Hogan and Commissioner on International Partnerships Urpilainen were all asked about their views and visions. Justice Commissioner Reynders, who is likely to be the commissioner responsible, emphasized that for a real sustainable policy needs to incorporate climate, environment and local communities and that voluntary commitments on human rights are not enough. He confirmed that he will act and improve the legislative framework in regards to sustainability and human rights.

The enthusiasm has reached even the Council that usually is the slowest one to move among the EU institutions. Current EU presidency, Finland, will organize a presidency conference “Business and Human Rights: Towards a Common Agenda for Action” in December.

Also the forthcoming German presidency has identified due diligence as a priority. We will see, if and how the due diligence work is linked with the German Initiative on Sustainable Cocoa.

I have understood that this initiative has been a success story so far: the share of sustainably produced cocoa in Germany has been increased from five percent in 2011 to about 60 percent today. We need more of this kind of initiatives in the cocoa sector, and in all other sectors as well, but you know this initiative much better than I do.

In 2018 I was the rapporteur of the European Parliament Report on transparent and accountable management of natural resources in developing countries: the case of forests. In this report the European Parliament clearly acknowledges that “the EU is clearly part of the problem of global deforestation.” This European Parliament report led the European Commission to publish its study on options to step up EU action against deforestation, and later, last July, a full Communication on Stepping up EU Action to Protect and Restore the World’s Forests

As one of its key actions the Commission will assess both regulatory and non-regulatory measures to ensure a level playing field and deforestation-free supply chains. These are not the only actions the EU Commission is taking. The Commission is also finalizing a study on regulatory options to require business to undertake due diligence for human rights and environmental impacts in own operations and the supply chain. Also this study is foreseen to be published in December.

I hope you don’t need more proof that the momentum for a responsible cocoa sector in the EU is now. The time is right.

We have a momentum but why do we need legislation?

Legislation is not a goal in itself. It does not have inherent value. What is more important is that the legislation is able to deliver, able to make a change in the society. Professor John Ruggie, former UN Special Representative behind the UN Guiding Principles on Business and Human Rights explains this perfectly. What we need is a smart mix!

This smart mix means the right combination of mandatory, voluntary, national and international measures that are needed to effectively foster business respect for human rights in a particular context. It does not mean just voluntary means, but it does not mean legislative and regulatory means only either. A secret to good legislative and regulatory intervention is to use the right tool in the right place. Voluntary initiatives have brought us to this point but it is evident that all problems are not solved. We need to consider new means to fight against deforestation, to eradicate child labour and to empower and improve of the livelihoods of the cocoa farmers and their communities.

Legislation would benefit also consumers as well as companies!

Supply chain due diligence legislation would require companies to make sure that no illegally produced cocoa, or cocoa not produced in accordance with social and environmental standards, would end up in the supply chain. I understand perfectly well that tracing the true origin of cocoa and verifying the sustainability of the supply chain is very difficult, but that burden cannot be placed on an individual consumer, who somehow, would need to make the right choice. Every consumer has a right to assume that no matter which chocolate he or she buys, he or she is not even indirectly contributing to social or environmental problems but, on the contrary, is through his or her purchase supporting sustainable and responsible cocoa production!

Only legislation is able to provide a level playing field for the companies in the market! Legislation would protect responsible companies against their fraudulent competitors and freeriders. Responsible and sustainable actions should be rewarded. These changes can be achieved only through legislative measures.

What kind of legislation we need then?

Now is time to seriously evaluate how such legislation should be construed. The legislation should not be just a combination of goals and values. This is a multifaceted, complex issue.  The legislation needs to be comprehensive yet implementable, and also enforceable. It should be based on thorough impact assessment. This legislation should incorporate best practices and lessons learned from already existing laws: For example: The Duty of Vigilance law in force in France requires companies to analyse the risks in their supply chains, come up with a strategy to mitigate these risks and report this information publicly

Another great example is the Voluntary Partnership Agreement -model under the Forest Law Enforcement, Governance and Trade, so called FLEGT. These agreements also support good governance and bring inclusivity into the EU’s partner country’s decision making. It is utmost important. The good governance is the key to both vibrant agriculture sector as well as the vibrant private sector, as Mr MIZZI from the Commission explained yesterday.

Finally, this legislation needs to made in the EU-level, not nationally. We need less fragmentation, not more. Sometimes the road to hell is paved with good intentions: That could be the case, if the EU single market is overburdened with overlapping national laws.

Not just legistation

Finally, I want to say that the legislation is not a silver bullet. It does not operate in a vacuum. Actually, without supporting policies and infrastructure it may not work at all. The legislation is just one piece in the puzzle. We also need development cooperation and EU partnerships with the cocoa producing countries. The EU should provide technical cooperation so that full potential of legislation and other EU-policies can be achieved.

Essentially, what we should do, and what we are doing here, today, in this Conference, is to work towards a common goal that is sustainable production of cocoa, free of deforestation, child labor and bonded labor. And we can only achieve this goal together.