Fairtrade & DISCO compliant cocoa
Fairtrade supports retailers, traders and processors, manufacturers and brands in fulfilling their DISCO commitments for cocoa.
The Dutch Initiative on Sustainable Cocoa (DISCO) is a public-private partnership active in the Dutch cocoa and chocolate sector. Companies that signed this sector initiative have committed to achieving goals on living income, deforestation and child labour. In order to fulfil these commitments, companies must first understand the requirements of what is referred to as ‘DISCO compliant cocoa’. Once understood they can adjust their purchasing practices.
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Fairtrade standards
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Living Income Reference Price
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Strong Producer Organisations
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Customized projects on productivity and diversification
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Assessing gaps to living income
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Advocacy
The business case:
When your company buys cocoa on Fairtrade terms, you work towards enabling farmers to reach a living income in the following ways.
1. The income gaps of cocoa farming families in your supply chain can be identified on the basis of economic baseline data collected at farm level through farm records. 2. You purchase your cocoa responsibly on the basis of a smart mix of interventions including paying farmers better prices, starting with the Fairtrade minimum price and premium. 3. You support cocoa cooperatives in becoming democratic, professional, farmer led organisations. Working together, these farmers can implement programs to achieve higher yields, cost-efficient production and more diversification. Take a look at the monitoring report of our Fairtrade West Africa Cocoa Programme. 4. You are part of a global network that works with and for farmers. Fairtrade has a capable team of advisors in Côte d’Ivoire, Ghana and other cocoa producing countries. They work directly with farming cooperatives on a daily basis to support them in becoming strong and professional cooperatives.
Fairtrade’s impact in our work towards living incomes for cocoa farmers:
Fairtrade’s living income reference price is recognised by the industry as the most reliable methodology developed to calculate the price needed to close the living income gap for cocoa farmers. Companies we work with directly include: Colruyt and Lidl, as well as Tony’s Chocolonely that has been a core supporter and Fairtrade certified since day one. Tony’s Open Chain is built on the principles of Fairtrade. Tony’s Open Chain mission allies that are Fairtrade certified include Aldi, Ben & Jerry’s, Jokolade and PLUS supermarket. Tony’s Open Chain Living Income Analysis shows that premium payments including the Living Income Reference Price (LIRP) calculated by Fairtrade and paid by all Tony’s Open Chain mission allies, contributed on average 21.4% of income earned by cocoa farmers through cocoa in 2020-21. This was reinforced in Fairtrade’s farm record data from the same partner cooperatives during the same harvest season. Cocoa farmers received 6-15% more cash income due to the additional LIRP payment (the percentage varies depending on volumes sold at LIRP level). When taking in-kind income into account the percentage increased by 11-20%. In-kind income includes basic living costs covered by Fairtrade premium benefits, voted on by cooperative members. This varies per cooperative and can include housing or healthcare related costs.
The Fairtrade Cocoa Standard has seven key interventions that complement European regulation and aim to protect natural forests:
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Fairtrade Minimum Price and Premium
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Farming on deforested land prohibited
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First-mile traceability
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Geolocation data
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Prevention and mitigation including satellite monitoring
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On the ground support
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Advocacy
The business case:
When your company buys cocoa on Fairtrade terms, you are effectively working towards ending deforestation and forest degradation in the areas where you source.
1. Your cocoa is traceable back to the farm level (first mile traceability). 2. Your cocoa comes from farms that are mapped with GPS location points or GPS polygons (for farms larger than 4 hectares). 3. You buy cocoa from cooperatives and farmers that produce cocoa with respect for the environment. These farms are reviewed to confirm that your cocoa comes from land that was not deforested after 31st December 2018, two years prior to the European Deforestation requirement. 4. You support farmers in gaining access to quality information and training; and being better aware of the impacts of environmental issues on their crops and livelihoods. 5. In choosing Fairtrade you’re driving positive change in cocoa farming communities and supporting a fairer future where cocoa farmers can grow their incomes, invest in new cocoa trees and agroforestry to increase production in a sustainable way.
Fairtrade’s impact in our work to end deforestation and forest degradation:
Fairtrade ‘s interventions, including standard requirements, pricing tools, producer support, climate academies, deforestation data and intelligence all contribute to building the climate resilient practices of Fairtrade producer organisations. Fairtrade cocoa farmers can grow their incomes, invest in new cocoa trees and agroforestry to increase production in a sustainable way. We complement our certification services with a range of tailored programmes so that together we can deliver maximum impact for farmers and their families. Programmes are usually funded through a combination of commercial partners, cooperatives and Fairtrade, often with institutional funding. Three examples in relation to deforestation are: 1. Access to farm geolocation data and data management tools 2. Access to satellite monitoring data of deforestation risks 3. Promotion of smallholder farmers as forest protectors
Specific requirements against child labour are integrated in the Fairtrade Standards:
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Risk assessments conducted
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Monitoring and remediation system
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Fairtrade Child Labour and Forced Labour Prevention and Remediation Programme
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On the ground support
The business case:
When your company buys cocoa on Fairtrade terms, you are effectively working towards eradicating child and forced labour
1. By sourcing cocoa on Fairtrade terms you tackle the underlying root cause of child labour, poverty, by paying at least the Fairtrade minimum price and premium. 2. Fairtrade has strong teams in Ghana, Côte d’Ivoire and other cocoa producing countries that work directly and on a daily basis with the coops to support them, ensuring that farmers have the knowledge and resources to address human rights issues such as child labour in their communities. 3. Fairtrade cooperatives conduct risk assessments. They identify where there are high-risks and develop and implement action plans to prevent, mitigate, cease and remediate child labour. 4. Fairtrade cooperatives in Ghana and Cote d’Ivoire have a child labour monitoring and remediation system in place to regularly check for and respond to cases of child labour and forced labour. 5. You can contribute to the Fairtrade Child Labour and Forced Labour Prevention and Remediation Programme. This fund allows cocoa cooperatives to apply for financing to do additional work towards the prevention and remediation of child labour. In this way you can meet the Fairtrade requirement that companies throughout the Fairtrade chain provide resources and support to cocoa cooperatives who have identified child labour and/or forced labour as a high risk. Support can be in the form of funding, training, facilitation of partnerships, advocacy with government, etc.
Fairtrade’s demonstrated impact in our work towards ending child labor in cocoa:
1. Fairtrade certified farmer organisations show positive effects on addressing child labour. Review of research on Fairtrade from 2015-2020, page 32. 2. Compared to other farmers, Fairtrade cocoa farmers in Ghana are more aware of child rights norms and the benefits of going to school. Assessing the Impact of Fairtrade on Poverty Reduction and Economic Resilience through Rural Development, 2022, page 47. 3. Child rights awareness is very high. Farmers have internalised values around child rights. They believe that children (both boys and girls) should go to school, that they should not engage in dangerous labour, and that any work should not interfere with their schooling. West Africa Cocoa Programme Monitoring Report, 2023, page 24.
Are you interested in learning more about how working with Fairtrade supports your commitment to DISCO goals? Please contact Susanne Boetekees at susanne@fairtradenederland.nl.