Calling on food companies to ‘open up’ their supply chains!

29 May 2012

Globalisation of business has accelerated the complexity of supply chains. Today, very many food companies are increasingly linked to a large web of suppliers, ingredient vendors, processors and brokers from various parts of the world. For instance food and beverage giant Unilever alone sources raw materials for production from more than 10,000 suppliers and non-production goods and services from about 160,000 suppliers. With the complex nature of present day supply chains, it becomes imperative for food and beverage companies to ensure that internationally recognised standards are nurtured and maintained by all of their suppliers. Supply chain transparency is a key element of this process.

Generally, companies are known to be reticent about the issue of transparency in their supply chains; there have been growing concerns over the alarming occurrences of labour exploitation on farms and factories, slavery and human trafficking, child labour and other forms of human rights abuses as well as the use of toxic pesticides within the supply chains of food and beverage companies. The case of child labour in the cocoa industry is a clear example. Whilst over 1.8 million children are said to be part of cocoa laborers in West Africa, big cocoa companies are quite tight-lipped about its occurrence in their supply chains. CNN’s investigative report on the cocoa sector in Ivory Coast proved that indeed child labor still exists in supply chains of big chocolate companies. Last year, some research by one of our alliance partners –SOMO – revealed several unnerving socio-economic issues in the Peruvian mango supply chains of major EU food and beverage companies.

Food and beverage supply chains haven’t been scrutinised as much as should be; two important legislations –the H.R. 2759: Business Transparency on Trafficking and Slavery Act (Bill introduced in US Congress 01-08-11) and the California Transparency in supply chains Act 2010 (already in effect since 01-01-12) – essentially require some US companies (including food companies) to disclose any measures they are taking to identify and address issues of child labour, slavery and other forms within their supply chains. A handful of them however are making good efforts; last year we saw Nestle open up its supply chain for assessment by The Fair Labour Association to make sure that “Child labour has no place in our supply chain”.  More food companies need to follow this example.

In the coming months Fairfood International will be taking a closer look at some of the important issues that occur in food companies’ supply chains. With the launch of OPEN UP today, Fairfood will be calling on Food and beverage companies to be more transparent about how they are addressing important issues occurring in their supply chains. The expectation is that with increased supply chain transparency, food companies can identify, mitigate and prevent risks to their brand and reputation as well as risks to people’s lives and the environment.

– Anselm Iwundu, Executive Director, Fairfood International