A Dutch chocolate company’s fight to end illegal child labor – Transcript

00:00Nearly two-thirds of the world's cocoa production comes from West Africa, where an estimated 1.6 million children work illegally on farms across the region. But rooting out the illegal practice is difficult. Last month, the U.S. Supreme Court ruled in favor of food giants Nestle and Cargill, where both companies were being sued over claims that they knowingly bought cocoa beans from farms which used child slave labor.

00:25But one small company in the Netherlands is on a mission to shake up the industry and eliminate illegal child labor completely. NewsHour Weekend Special Correspondent Megan Thompson reports. There's something striking about the Amsterdam offices of chocolate company Tony's Chocolate Only, the tables and bikes outside, the floors, envelopes and shipping boxes inside.

00:47Red balloons. Virtually everything is fire engine red. It's partly the playful nature of the growing company where employees all have fanciful titles like Impactist Prime, Inspire to Actress and the boss. So I hate to be called CEO.

01:04I just want to be the Chief Chocolate Officer. But the color also serves a serious purpose. The real color of alarm is red. And if you really want to point out that there is a problem and that something has to be done, you have to use the color of red. These are the kids. The problem?

01:20Children working illegally in the supply chain of cocoa. And if you realize kids are actually producing the chocolate that we love, then you have to feel something needs to change. Tony's has a goal to make chocolate what they call 100% slave-free, not just their chocolate, all chocolate.

01:39Our goal is to eradicate all illegal labor from the very chain of cocoa. That is quite an ambitious mission for a small company that we are, but we are very serious about it. And it is a serious problem. According to a recent report, in the cocoa growing areas of Ghana and Ivory Coast, where most of the beans used to make the world's chocolate come from, almost half of the children work as child laborers.

02:05That's more than one and a half million children. Most are doing what's termed hazardous work, involving sharp tools, heavy loads or toxic pesticides. It's all part of the laborious process of separating beans from the large cocoa pods pulled from trees.

02:22If the child is working on a weekend, for example, helping the parents, that's not child labor, that's child work. But if they're missing school or if they're doing work that is detrimental to their health, that is child labor. Nagoy Nyango is the global CEO of Fair Trade International, which certifies ethical practices of products around the world.

02:43Cocoa is its flagship issue. Nyango says the price is basically controlled by a handful of large chocolate conglomerates who pay farmers very little. Families who can't afford to hire workers are using their children instead. It's about not earning a living income.

02:59It's about farmers struggling but not getting the returns that they should get from the products that they grow. The worst forms of child labor, when children are trafficked and forced to work without pay, that's what police in Ivory Coast were after in this raid on a cocoa farm last year.

03:20According to one study, as many as 16,000 children in West Africa are being exploited this way. Although child labor is not unique to cocoa, the fact that chocolate is a luxury product, a more than $100 billion a year business when most cocoa farmers live below the poverty line is what struck Dutch journalist Ton van de Koken as particularly outrageous.

03:43He was even filmed for a television program trying to get himself prosecuted, arguing that by eating chocolate, he was complicit in a crime. In 2005, he co-founded Tony's Chocolate Lonely, a combination of his first name and what he called the Lonely Battle to reform the chocolate industry.

04:00But on the inside, the messaging includes the uneven way the bars are divided. Sometimes you have a big piece like the big chocolate companies and sometimes you only get a very small piece just like the cocoa farmers get so little of the value of chocolate. While Tony's isn't the only chocolate company touting its ethical practices, it's arguably one of the most successful.

04:21What started off in a whimsical way with just 5,000 chocolate bars is now the most popular chocolate brand in the Netherlands with about $100 million in revenue last year. And the company is expanding into markets around the world, including the United States.

04:38Key to Tony's strategy is traceability. Cocoa beans in West Africa come from thousands of small farms and pass through many hands. Most big chocolate companies admit they don't know where all their beans come from. Tony's, on the other hand, has long-term relationships with specific cooperatives.

04:55Like the fly chain machine. And it's even developed its own online software to track every bag of beans by lot number. And we can trace back which farmers it gives us.

05:14And Tony's pays premiums to help farmers modernize and get out of poverty. In Ivory Coast, for example, Tony's is now paying about 68% more than the minimum price set by the government. And that contributes to making the chocolate more expensive. The US, this bar is a little under $5.

05:32And this bar would have costed, let's say, $3.50 if we were paying the lowest possible price to farmers. But we don't pay the lowest possible price to farmers. We pay a dignified price. It brings them to living income.

05:48This problem is not exactly new. The chocolate industry has been under fire for years. Back in 2001, after the US Congress threatened legislation to address child labor in cocoa, eight of the biggest chocolate companies negotiated a voluntary agreement instead, pledging to eradicate the worst forms of child labor in cocoa by 2005.

06:08That deadline and others in 2008, 2010, and 2020 came and went. Now they say they're committed to a new deadline, 2025. And if you look at some of the big chocolate company websites like Mars, Nestle, or Hershey, the issue is front and center.

06:26They talk about protecting children with big investments in local communities, working with families to get kids back into school, and increasing child labor monitoring programs. But still, the number of child laborers in West Africa hasn't changed much over the years.

06:43And as of today, only about 25% of the supply chain is even being monitored for child labor. The aim is to increase those programs. Alexander Ferguson is with the World Cocoa Foundation, a trade group that represents about 80% of the chocolate industry.

07:00A lot of the big chocolate companies have programs to crack down on child labor. Are those programs going far enough? I think the mistake made in the past is that companies thought they could solve this alone. Many of our companies do have supply lines that are traceable and look for child labor and also pay premiums to farmers so that they get a higher income.

07:28I mean, this is something that is being done across the industry, and there needs to be more of it. So some companies could be doing very well. Some companies are not doing anything because all this is voluntary.

07:45And for years, over 20 years, we've had a lot of these voluntary initiatives that have really made little difference, I must say. And I think when it becomes compulsory that companies have to be responsible for what happens in their supply chain, I think that's where we really make an impact.

08:07Tony's agrees, laws are needed. It's most recent lobbying effort, a petition to the EU signed by more than 66,000 of its Choco fans, supporting a law that would hold all companies accountable for their supply chains. We have to look for problems in the supply chain in order to solve them.

08:26So it's about putting the problems towards us instead of pushing them away. And Tony's does find problems, cases of child labor among its farmer cooperatives. When it does, says impact navigator Pavithra Ram, local monitors track everyone and work to get children out of danger or into school.

08:44Other chocolate companies also use some sort of the child labor monitoring system. What makes us unique is that we implemented for 100% of our supply chain. So you can't just go to some communities or a part of your supply chain and say, oh, we're monitoring there, we found cases.

09:01You need to do it for your entire supply chain because otherwise it's, you're not doing enough. Tony's efforts have won over at least one major ally, Barry Callebaut, the biggest chocolate manufacturer in the world.

09:17I think Tony's is really a pioneer and also a leader and a front runner. Barry Callebaut produces chocolate for brands around the world, turning beans into liquid, a key part of the chocolate making process. Tony's convinced the company to use separate tanks to segregate its beans, to preserve the integrity of its supply chain.