What’s with Nestle’s move to do the right thing on child labour?

Photo by Riccardo Annandale on Unsplash

So here I was, wondering if Nestle, a company with an often unsavoury reputation, really means to make direct payouts to cocoa farmers in Cote d’ Ivoire and Ghana to end child labour in its supply chain?

Is the social welfare scheme for real or is it meant to be just good PR?

On the phone from the Netherlands, Antonie Fountain, managing director of VOICE Network, a global non-profit umbrella group working for sustainable cocoa, told me: “It’s a significant investment that Nestle is making and the plan has some interesting components, which could be successful.” Nestle is one of seven big western companies involved in the chocolate trade, so “it’s a good start” towards reform of the sector, he said.  “It can’t solve all the problems, of course,”

Mr Fountain added: “For instance, Nestle has not said anything about paying farmers a fair price. But, there are some good things in this anti-poverty measure, such as gender equality, which they place at the centre of the approach.”

I felt reassured somewhat but wanted to check in with another NGO.

Jeroen Douglas, executive director of Solidaridad, a civil society organisation that works on sustainable supply chains, said he welcomed “Nestlé’s innovative plan for an income accelerator in parts of their cocoa supply chain.” He added that the proposed investment “in four different layers shows that there is no such thing as a silver bullet to solve the systemic problems in the cocoa sector. We hope Nestlé will be able to scale the programme to its entire sourcing base, as well as to other chocolatiers.”

Mr Fountain, who has advocated for a sustainable cocoa sector for more than a decade and co-authors the biennial Cocoa Barometer report, praised Nestle’s plan as “a new thing for which Nestle wants to take credit” as it will obviously be good for business.

But there’s a further upside for Nestle, of course there is. “It’s bad for business,” said Mr Fountain, “when your consumers think you’re unethical.”

Too true. So we’ve come full circle. We’re back at Harvard business administration professor Nien-hê Hsieh‘s suggestion that businesses must think for themselves about right and wrong. We’ve returned to the UN Ruggie Principles and their deliberate refusal to make corporate moral responsibility an obligation. In fact, we’re back at first principle: businesses, just like individuals, have agency and can effect change, if they see fit.

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