Transparency and Accountability
Towards building trust in the cocoa sector’s sustainability efforts
A consultation paper for the 2022 Cocoa Barometer / September 2022
Sustainability has become a central element of the cocoa sector. Cocoa companies have ramped up their
Corporate Social Responsibility portfolios and taken individual and collective commitments. Producer
governments have developed sustainability policies and standards to build market confidence. Consumer
governments have started to propose legislation to tackle their trade footprint. Certification bodies have raised
their standards. Civil society and researchers have harnessed the explosion of accessible data on supply chains,
livelihoods and the environment. Yet, unsustainable cocoa production continues, and the impact of cocoa
stakeholders’ efforts are undermined by a general lack of trust in public and private actions.
Sustainability efforts can only become credible if built on a sound understanding of the risks and challenges, which
greater transparency can provide. These efforts must also include relevant and effective measures, which shouldbe framed by greater accountability. This paper argues that transparency and accountability are critical ingredientsfor trust building. It aims to demystify the two concepts and proposes actionable solutions to build trust in thecocoa sector, illustrated by case studies.
Contents
Part 1: Why transparency and accountability matter ...................................................................................................... 1
Part 2: Actions for a transparent and accountable cocoa sector................................................................................... 5
Part 3: Access to information and accountability ............................................................................................................ 8
Part 4: How can the different stakeholders contribute? ............................................................................................... 10
Colophon ........................................................................................................................................................................... 12Part 1: Why transparency andaccountability (T&A) matter
The state of play of traceability and transparency of thecocoa sector, and related gaps and challenges inmajor producer countries, is well documented (see forexample Nitidae and EFI, 2021a; Nitidae and EFI,
2021b; Nitidae and EFI, 2022; IDH, GISCO, CLever.org, 2021). This section highlights the potential
benefits of increased transparency and accountabilityof the cocoa supply chain for all actors.

T&A make traceability efforts effective
and credible
Traceability of cocoa to the area of production isessential to assess compliance with sustainability
standards – such as the proposed EU regulation on
deforestation-free products – and is a key tool toachieving sustainability objectives.
All the main cocoa trading companies have developed
internal traceability systems and use software to track
cocoa beans from the cooperatives or farmers’
associations they work with. Cocoa producing country
governments, such as Côte d’Ivoire and Ghana, arealso developing national unified traceability systems
that aim to trace cocoa from the plot to the port, anddigitise data and payments. These systems collectimportant information, such as on cocoa farms' andfarming
households’
socioeconomic
andenvironmental characteristics, plot geolocation,
certification premium payments, supply chainintermediaries or cocoa quality.

cocoa sector by strengthening transparency andaccountability.
Transparency is the disclosure of informationnecessary to know what is happening in the supply
chain. Transparency has an outward-looking
dimension of demonstrating performance andbuilding trust. The Accountability Framework Initiative(AFi, 2019) provides unified guidance to companies
on reporting and disclosure practices to increase thecredibility of their claims. This includes guidance on
sources of information that are most relevant to supply
chain transparency, but also on methods anddefinitions that underpin data collection and its
interpretation, including supply chain traceability andgeographical information on sourcing.

Yet, at this stage, current traceability efforts areundermined by the fragmentation of existing datasystems and metrics, reluctance among public andprivate actors to share data, and limited data quality
control. This situation has led to a duplication ofefforts. For example, more than 20% of farm polygons
registered by the Rainforest Alliance in Côte d’Ivoire
are mapped at least twice. It also makes it difficult toaddress the risk of fraud. Some farmers source frommultiple plots, in other cases plots are shared between
different farmers, complicating efforts to guarantee
cocoa comes from a particular place. Beans are also
mixed at various downstream steps in the value chain.
It can be mixed at the level of a cooperative, a local
trader, a wholesaler, an exporter, and/or a processor,
further challenging traceability systems (Nitidae andEFIa, 2021).

Supply chain transparency is not about making all data
available to everyone, nor about widely disclosing
competitive or proprietary information. Data sharing
can take various forms adapted and accessible to therelevant actors, especially to those that are ‘credibility
influencers’, such as trusted independent monitoringorganisations.
Accountability means being responsible for what you
do. Supply chain accountability goes beyond
transparency and includes other mechanisms – such asverification, audit, complaints mechanisms – that
demonstrate a willingness to make oneself ready toanswer for one’s acts. This can include the recognitionof errors and unforeseen negative consequences andactions to rectify them.

Improved data transparency, even when data is not
perfect or incomplete, helps to better manage risk inthe supply chain, enhances the reliability andefficiency of traceability systems, and helps build
legitimacy and trust. First-mile traceability and risk
management solutions require regularly updated plot
-level agroeconomic and spatial information aboutcocoa production, which is costly and imperfect.
Therefore, cross-referencing of data, validation andverification between sources can benefit all
stakeholders regulating and sourcing from the same
area. Disclosure of sustainability risk information at thelevel of the sourcing area can enable actions anddemonstrate legitimacy to the consumers (AFi, 2020).

Traceability commonly refers to the ability to track theorigin, production, processing history and distributionof a product. Traceability plays a key role in supply
chain management. Traceability information usuallyremains in the ownership of supply chain actors thatgenerate it, unless required by law, commercial
agreements or voluntarily disclosed.

T&A provide a level playing field forsupply chain actors

Box 1: Definitions
Credibility is the quality of being trusted andbelievable. In this paper, we show how responsible
supply chain actors can improve credibility in the

All the major chocolate manufacturers and cocoa
traders have developed sustainability initiatives overthe past years, which include the partial disclosure of
information about suppliers and supply areas. These1

can include interactive maps featuring GPS
coordinates of supported farms, lists of supplying
certified cooperatives or numbers of certified farmers.

Box 2
Indirect sourcing makes transparency of cocoa
origin very complex

Yet, this disclosed information is scattered,aggregated, sometimes abstract and practicallyunverifiable. Organisations like Mighty Earth, throughits Accountability Map, or the Trase Initiative haveattempted to make sense of this data - their efforts
show that major gaps in transparency remain (Box 2).
Collaborative frameworks such as the Cocoa andForest Initiative have so far focused on harmonising
reporting frameworks on sustainability actions but
restrain from organising collective data disclosure.
Certification companies do centralise a lot of
information, but the transparency of this data, such as
on certified volumes, premium payments or impact
measurement – let alone polygon data or farm point
information - is far from its true potential.

Recently, Trase (Trase, 2022) used publicly available
data to map Côte d’Ivoire’s cocoa supply chain for2019. They used a list of suppliers in West Africa,
disclosed by several major cocoa traders andchocolate manufacturers.
Brands such as Nestlé, Ferrero, Mondelez and Mars,
are now reporting some of the traders andcooperatives they source from. Meanwhile, processors
and traders, such as Barry Callebaut, Cargill, Olam and
Sucden, disclose some of their cooperative suppliers.
In contrast, chocolate company Lindt & Sprüngli andtraders such S3C, Africa Sourcing, Theobroma andAlbrecht & Dill Trading disclose no information on
their sourcing.
In general, the level of transparent information isbetter for cocoa sourced from Côte d’Ivoire incomparison to Ghana, Cameroon, Nigeria, and manyother cocoa-producing countries.

However, a few trading companies and chocolate
manufacturers (such as Uncommon Cacao andEthiquable) demonstrate that transparency about theorigin of each ingredient in a chocolate product ispossible and commercially viable.

However, the data disclosed by companies isscattered, incomplete, often outdated and nonstandardised. For instance, the geolocation andnumber of farmers per cooperative can be missing,and volumes sourced per supplier are not provided. In
addition, so far, companies have not disclosed
information on their volumes of certified cocoa, i.e.
how much they source from different certified
suppliers _ cooperatives or farmer groups.

In a competitive market environment, most actors
might not be interested in increasing transparency
individually. But data is no longer competitive if
disclosure has become common practice. Whencocoa supply chain data is disclosed following bestpractices and standardised approaches, such as
described in the Accountability Framework Disclosure
guidance (AFi, 2020), it can unleash the potential toeliminate unfair competition and business practices inthe supply chain.

Similarly, once cocoa arrives in Europe, little
information is disclosed about the flow of processed
products within the EU block. In consuming countries,
retailers could lead by being more transparent,
disclosing where the chocolate they sell is processed
and the identity of their secondary suppliers (so called“tier 2 suppliers”).

For instance, the disclosure of information on
production and sales volumes would radically level theplaying field in terms of governance and sustainability
risk assessment. In addition, when information accessis guaranteed to those who have less power in the
supply chain (such as farmers, and local civil society), it
enables their effective participation in decision
making around natural resources and farmmanagement.

Most cocoa has an unknown origin
Overall, less than half (44%) of cocoa beans exported
from Côte d’Ivoire can be traced to a cooperative,
using publicly available data. The remainder isindirectly sourced from local intermediaries by major
traders (24%) (‘Indirect’ sourcing) or exported by2

traders who disclose no information about their
suppliers (32%) (‘Unknown’ sourcing). The percentage
of indirect sourcing varies among traders:approximately 30% for Olam and Barry Callebaut; andover 60% for Sucden and Touton.

stakeholder consultation; or insufficient accountabilityof public authorities on the use of proceeds fromcocoa trading.
Increased concerns of chocolate consumers havetriggered international scrutiny and legislative reforms
in consumer countries, which are significantly
impacting the supply chain. The forthcoming EU
deforestation regulation (see Box 3) is likely to provide
a competitive advantage to producing countries thatcan demonstrate they take cocoa sustainability
challenges seriously. This includes, for instance,
acknowledging drivers of cocoa unsustainability andquantifying cocoa production that is unsustainable orat risk of being so. In West Africa, collectively
identifying cocoa produced on illegally deforested
land and clarifying the rules that apply to cocoa
currently sourced from forest areas would be a major
step forward in providing market confidence andmitigating sourcing risks.

Indirect
480,400 tonnes
23.9%

Unknown
650,500 tonnes
32.4%

Traceable tocooperative
875,500 tonnes
43.6%

Traded Volumes

56.3%
Trase’s work highlights the importance of indirectsourcing, which – despite its scale – is not accounted
for in most corporate sustainability reporting.
Members of the Cocoa & Forests Initiative, forexample, submit annual progress reports onsustainable sourcing, but these reports are limited todirectly sourced volumes only. CFI members reportthat 72% of directly sourced cocoa is traceable to farmin 2020 (WCF, 2022). When indirect sourcing is added,
the overall percentage of cocoa that is traceable falls
closer to 50%. This means that cocoa trading
companies and the chocolate manufacturers further
along the supply chain do not know the origin or
sustainability risk of a large share – in some cases the
majority – of their cocoa.

By providing clear legal and institutional frameworks
and making available relevant official data on supply
chain production, trade and land-use, producing
countries can create a conducive environment for
operators to perform due diligence. This would also
give them a competitive advantage on the cocoa
market. For companies, pooling data on sustainability
risks and cross-referencing suppliers’ information
could reduce risk assessment costs and mitigate therisk of fraud in their supply chain, thus facilitating theiraccess to the EU market once the regulation will be inforce. It would also increase consumers’ trust in theirproducts.

T&A enable improved market accessBox 3

In major producing countries, the cocoa supply chain
is characterised by great opacity, due to the strategic
nature of the industry and its economic and politicalweight. Major governance challenges in producing
countries include: a lack of transparency and legal
basis for some supply chain rules, such as direct block
deals1 in Côte d’Ivoire or price scale updates; suddenchanges in supply chain management rules without

Upcoming EU due diligence requirements
Responding to growing consumers’ sustainability
concerns and in line with the EU Green Deal and Zero
tolerance approach against child labour, theEuropean Commission has initiated various legislative
processes to strengthen due diligence obligations of

A block deal is a privately negotiated transaction that is
executed apart from the public auction market.
1

3

companies operating on the EU market, to reduce theEU consumption’s environmental and social impact.

horizontal legislation aims at harmonising due
diligence frameworks that apply to large companies
operating in the EU, across their operations. This
proposed directive would complement supply chain
regulations on broader sustainability challenges suchas human rights, climate change or decent wages.

Among these measures, a proposal for a regulation oncommodities and products associated with
deforestation and forest degradation was adopted by
the European Commission on 17 November 2021.
This proposal follows the Communication of the Stateof the World’s Forests of 2019 and extensive
consultations and support from supply chain actors.
The proposed regulation, which covers cocoa and its
derived products, would require operators andtraders placing cocoa on the EU market to conduct
due diligence to ensure that cocoa is not linked todeforestation. It builds on three major requirements:

T&A help increase farmers’ income
Asymmetries of information in the agriculturalcommodities sector are well-known contributors topoverty. The lack of transparency in the cocoa market
impedes farmers from accessing information on
demand, prices, quality, harvest or premium payments(UNCTAD, 2016). For instance, many studies
investigating the impact of cocoa certification in West
Africa have highlighted the lack of awareness offarmers on price premium schemes and on their very
participation in those (Uribe and Ruf, 2019).

Traceability: Operators will need to be able todemonstrate cocoa origin to import cocoa into the EU.
Traceability from plot to port would be needed,
including geolocation information.
Zero deforestation: Cocoa cannot be placed on the
EU market if produced on a plot deforested after acertain cut-off date.

Tracking data on premium payments throughtraceability systems brings benefits both to farmers byincreasing their income and to companies bydemonstrating their sustainability claims (Fairfood andUniversity of Wangeningen, 2022).

Legality: Cocoa cannot be placed on the EU market if
not in conformity with the producing country’s legal
framework.

Furthermore, the unavailability of data on relevant
variables for farmer incomes (labour days required per
hectare, costs of production, costs of inputs, etc.) has
led to a lack of clarity and to mistaken assumptions
about how to improve farmer income. For instance,over the last decade, it has been assumed that
adopting Good Agricultural Practices would be
sufficient to improve farmers’ income. However,recent studies (IDH, 2021) have shown that higher
productivity could lead to lower net incomes, due tohigher costs.

Moreover, the proposal introduces a country
benchmarking system that reduces due diligencerequirements when sourcing from countries
presenting a low risk of deforestation and have put inplace relevant policies and partnerships to address
drivers of deforestation.
On 23 February 2022, the Commission published a
Communication on Decent Work Worldwide, which
proposes a comprehensive approach that addresses
workers in domestic markets, in third countries and inglobal supply chains. As part of this initiative, theEuropean Commission published on 14 September
2022 a proposal for a regulation prohibiting products
made by forced labour, including child labour, fromentering the EU market.

Greater transparency and accountability are alsoneeded when it comes to farmer support and benefit
sharing in the value chain. In several producer
countries, dedicated funds financed by levies on thevalue chain are managed centrally on behalf ofsmallholder farmers. This is for instance the case of the
Rural Investment Fund (Fonds d’Investissement en
Milieu Rural) or the Fonds Sacherie in Côte d’Ivoire,
which are meant to reinvest proceeds from cocoa
exports into supply chain development, farmers’

In addition to these upcoming regulations targeting
specific supply chains, the European Commission also
put forward in February 2022 a proposal for a directiveon Corporate Sustainability Due Diligence. This4

support and infrastructure. However, misuse of funds
and lack of transparency has been reported for thesefunds (World Bank, 2021).

Action 1: Set up credible national andcompany traceability systems that
inform risk assessment and mitigation

Summary

Nowadays, most public and private cocoa traceability
systems focus on traceability back to the first point ofpurchase (cooperatives, Licensed Buying Companies,etc.), with data on traceability to farm level often being
unavailable or unreliable. In addition, cocoa
companies’ traceability efforts are limited to theirdirect suppliers (zu Ermgassen et al., 2022).

Increasing transparency & accountability brings many
benefits to the cocoa sector. It strengthens theefficiency and credibility of sustainability efforts. It
creates a level playing field for all actors. It enables
improved market access. And it can provide part ofthe enabling environment for higher farmer
incomes.

Côte d’Ivoire and Ghana’s efforts to put in place
integrated national systems – based on farmers’
registration and geolocation – are positive steps
forward. However, more transparency in thesesystems is needed, to demonstrate that cocoa at riskof deforestation or child labour is stopped fromentering the market, and create incentives to address,
rather than hide, causes of sustainability challenges.
Public traceability systems also need to respond to
supply chain actors’ needs, at the risk of not being
used by operators; and build on companies’ efforts
and data, at the risk of increasing costs. Traceability
should also be enhanced beyond producer countries(see Box 4).

Part 2: Actions for a transparent
and accountable cocoa sector
Transparency and accountability are only means to anend, which is to help deliver the economic, social andenvironmental sustainability outcomes wished for bycocoa stakeholders, first and foremost by smallholder
farmers. Eventually, cocoa supply chain transparency
will only be effective if the users have the capacity,interest and trust in the information provided (Garder
et al., 2019).
This section outlines actions that can be taken toachieve progress towards traceability, reduced
deforestation, increased farmers’ income anderadicated child labour.

The credibility and acceptability of traceability systems
by both companies and government can be enhanced
by making available clear national traceability
systems specifications that clarify their value
proposition, outline realistic and progressive
milestones for roll-out, and propose how
responsibilities and costs will be shared between
supply chain actors. These should also ensure theintegration of and interoperability between public
and private sector data.

Unintended consequences
Increased transparency can also lead to unintended
consequences, such as exacerbating existing
inequalities, including gender inequality, further
excluding vulnerable groups, or divesting from poorly
governed or risky areas (Gardner et al., 2019). Thismeans that all actions must be designed with a specificawareness of the challenges faced by supply chain
actors, of the incentives that could lead them toengage and must embed mitigation measures
addressing unintended consequences.

Establishing independent governance frameworks
to monitor progress of traceability and transparency
in the cocoa sector, that include representatives of thedifferent supply chain actors (especially farmers andlocal civil society) is an essential component. Setting
up clear accountability mechanisms, quality
control and cross-referencing of data (in particularat farm level), independent audits and inspection
functions, as well as provisions for data access for third5

party monitoring should be part of these governanceframeworks.

Germany records these trades as imports from Ghana,resulting in discrepancies even if no nefarious
activities occurred.

Finally, traceability systems need to include
mechanisms on how supply chain actors deal with
non-compliant cocoa, and they need to incentivise
conformity to sustainability standards.

This poses a challenge for tracing goods throughout
the supply chain from origin to destination market andfinal consumer. The complexity of global trade andfragmented reporting and disclosure complicate
efforts to attribute impacts, target actions to reducerisks in commodity supply chains, and ensure fair
distribution of benefits. Greater transparency oftransaction-level data and active cooperation ofcustoms authorities is needed to identify instances offraudulent practices and illicit financial flows and to
hold actors throughout the supply chain accountable.

Box 4Transparency of trade data and trade misinvoicing
Cocoa traceability does not end at the port of Abidjan
or Accra. There is significant cocoa trade andtransformation happening within and between bothproducer and consumer countries, for which
traceability is completely missing. This box illustrates
some of the implications and challenges linked toindirect trade flows between producing and consumer
countries.

Action 2: Make available reference
forest and land-use data based onconsensual
definitions
andmethodologies

A 2016 UNCTAD study found that between 1995 and2014 one-third of cocoa exports from Côte d’Ivoire to
the Netherlands – valued at USD 5 billion – were notreported on the Netherlands’ import records(UNCTAD, 2016). This discrepancy may be evidenceof trade misinvoicing, a form of fraud in which
exporters and/or importers deliberately misreport thevalue, quantity or quality of a shipment of good (CGD,2018). Trade misinvoicing is problematic especially for
producer countries because it contributes to tax baseerosion and prevents producer countries from
capturing the full value of foreign exchange income.

Collectively addressing deforestation in the cocoa
supply chain requires a consensus on the problems tobe addressed and a common approach to define,
identify, monitor and mitigate deforestation risks.
Demonstrating that cocoa production is free fromdeforestation relies on the availability of spatial
information on cocoa production areas and forests.
This information provides the basis for estimating how
much past deforestation is due to cocoa expansion
and monitoring that there is no future expansion of
cocoa into forest areas.

Given that poverty is a main driver of deforestation andchild labour in the cocoa sector, it is critical that
producer countries realise the full benefits from trade
to invest in sustainable development and reduce risks
in the sector.

Currently, there is no consensus among actors on
deforestation trends and on the extent of cocoa
encroachment into forests in most producing
countries. When data exists, these vary tremendously
between sources. For instance, in Côte d’Ivoire, the2020 Conseil du Café Cacao farm survey results
indicate that 15% of classified forest areas are undercocoa plantation (CCC, 2021), while the 2020 forest
inventory estimated cocoa and coffee encroachmentof classified forest areas at 36% (MINEF, 2021). Recent
satellite monitoring-based research in Côte d’Ivoire
and Ghana estimated cocoa encroachment inprotected areas at around 20% (Abu et al, 2021).

While mismatches in trade data may provide evidenceof trade misinvoicing in some cases, reporting
differences also play a role. Exporters identify theimmediate destination country, which may be the firststop before goods are re-exported to another country.
However, the final destination country identifies theoriginal exporter, not the intermediate country(Shaxson, 2016). For example, Ghana’s exports toGermany via the Netherlands might be recorded asexports to the Netherlands on Ghana’s records, while
6

Deforestation trends for Côte d’Ivoire and Ghana also
vary tremendously based on the source of information.
While no data is perfect, transparency on definitions
and methodologies is required to make sense ofavailable information and ensure credibility of supply
chain actors’ risk assessments. Alignment is alsoneeded to build action around a common
benchmark. These should include not only access tothe various spatial products on cocoa production andforests, but also in situ data, collected over time,
preferably with geotagged on ground photos.

Action 3: Enhance transparency onpurchasing practices, prices and farmer
incomePoverty is a cause of most problems in the cocoa
value chain. For this reason, more companies andgovernments are committing to closing living income
gaps in their supply chains. For these commitments
to be credible, transparency is needed at least at twolevels:At farm levelBox 7 Comparing existing cocoa maps

Data transparency at farm level is an essential
prerequisite to close the living income gap.
Documenting and publishing income levels of
farmers, as well as aggregated agronomic data suchas average yields, farm size, costs of production andrequired labour, is essential to monitor progress
towards meeting living income targets. This data isalso key to design targeted support for the mostvulnerable farmers, including women; and reduceincome and connectivity and market access gaps.

Several attempts have been made recently to remotelysense cocoa plantations in Côte d’Ivoire using satellite
imagery, involving such reputable researchorganisations like ETH Zurich and the Joint ResearchCenter of the European Union. Nevertheless, remotelysensed maps of cocoa plantations may differ
significantly, regarding both cocoa areas anddistribution patterns. Differences in part are due tovarying map dates, definitions (e.g. including oromitting agroforestry plots), methods and training
data available to calibrate remote sensing algorithms.
The Citizen-Science Platform Geo-Wiki has collected
the various maps and displays them for comparison
purposes (https://tm.geo-wiki.org/). This platform wasdeveloped as part of the project‘Transparent
2
Monitoring in Practice’.

Greater transparency on company purchasing
practices – at the very least at an aggregated level –such as contract length, price guarantees andpremiums paid, and direct suppliers could alsoenhance stability on both farmers and companies’
sides.
The cost and burden of data collection and disclosure
should not be borne by farming households. As such,
farmers could be rewarded for sharing data. If donewell, these processes can facilitate strong feedback
loops between farmers and companies These are
critical pathways not only to address concerns, butalso to build trust between farmers and their clients.
Rather than data providers forced to comply withrequirements from purchase agreements, farmers canbe turned into partners if the correct incentives are inplace.

Forest and land-use classes definitions are needed
to detect and monitor boundaries between different
land uses. Legal frameworks should also clarify
whether legal forest conversion is still permitted ina given context and under which conditions. Other
important tools to operationalise zero-deforestationcommitments include up-to-date forest andprotected ecosystem maps, forest and land-use
monitoring systems, deforestation alert systems
and verification/sanction protocols.

At export and terminal markets
One major recent development in cocoa has been theimplementation of the Living Income Differential (LID),2

See https://www.transparentmonitoring.org/
7

a surcharge of USD 400 per tonne on the global
markets. Disclosing information on the export
contracting process, including auction and export
contract prices, and comparisons to the level of theterminal markets could help increase transparency ofthe markets, which is very much needed to make priceinterventions effective.

reporting framework on sectoral progress at thenational level. This involves consensus on
definitions and methodology of data collection. It
also requires regular large-scale research on thescope of the challenge. So far, attempts have been
made to discredit the results of such efforts (including
the various reports undertaken by Tulane and NORC).
Although there might be grounds to dispute themethodologies of such research, it will be important
going forward to find common grounds, acknowledge
the issues, and bring transparency to the results. The
biggest challenge at the level of sector-wide
transparency on child labour is not technical, butpolitical in nature.

Action 4: Create systems for individualand joint transparency on child labour
For two decades, promises to tackle child labour in thecocoa sector have not led to significant progress.
Claims about investments must be coupled withtransparency about achieved impact.

Part 3: Access to information
and accountability

Corporate reporting
The past decade has seen a positive development. A
handful of companies – at the time of writing, Nestlé,
Tony’s Chocolonely, Hershey, and Barry Callebaut –started to disclose the number of children found inparts of their cocoa supply chain and the number ofchildren taken out of child labour. These systems havecome to be known as Child Labour Monitoring andRemediation Systems (CLMRS).

Having transparent and accurate information about
the nature and scale of the issues at stake provides astrong basis for action and remediation. To be fully
effective, transparency needs to be mediated andmanaged by trusted intermediaries (Gardner et al.,2019).

However, other companies also use CLMRS without
disclosing any information on its impact. Furthermore,increasingly, CLMRS are not providing clarity on a
supply chain basis, instead favouring communitybased systems. This further reduces the transparencyof cases found and the accountability of companies fortheir supply chain. The publication of CLMRS data, atthe very least on households covered, number ofchildren and cases found, support provided andnumber of children who benefited from remediation,is needed to demonstrate impact.

Public disclosure
observation

andindependent

The development of traceability systems in the cocoa
sector is only one part of the challenge. For building
trust in markets and accountability, the accessibility ofsuch information is key. This doesn’t mean, however,that all information shall be made accessible toeveryone all the time.
Where national cocoa supply-chain information
systems create reporting obligations to supply chain
actors (for instance, mandatory disclosure of farmlevel traceability information) that involve confidential
or sensitive information, the information may bedisclosed only to a mandated independent
observer, tasked by the government to verify the
information provided and to hold the supply chain
actors accountable.

Collective reporting and commitments
Child labour is not only a question of individual
corporate responsibility. It also requires collective
action by all stakeholders involved, including
corporations and governments. This collective action
has often been hampered by a lack of credible data,
vague commitments and inconsistent reporting on
progress. In addition to individual reporting as
outlined above, collective action requires a strong8

Even when the principles of data transparency andeffective stakeholder involvement are met, the role ofindependent monitoring remains key for the successand credibility of the approach. Its important
contribution has been recognised in various trade
agreements between the EU and timber-producing
countries in the context of forest law enforcement,
governance, and trade (FLEGT) (Box 5). It contributes
to holding actors accountable to their respective
responsibilities and improves information systems
over time.

independent
enforcement.

monitoring

and

more

effective

Through this inclusive process, the relationshipbetween the Forestry Commission and CSOs
transformed from being adversarial to collaborative,
with CSOs ultimately contributing to the development
and operation of the WTS and its functionalities, aswell as in promoting the WTS as a credible tool toensure legality in national and international arenas.
There may be different levels of access for different
users especially for sensitive or commercial data.
Public disclosure is not always a necessity where atrusted group of key stakeholders –especiallyindependent monitoring organisations – has access tothe critical information.

Box 5
Ghana’s Timber Information Portals
In 2009, Ghana entered into a bilateral VoluntaryPartnership Agreement (VPA) with the EU under the
EU Forest Law Enforcement, Governance, and Trade(FLEGT) initiative. As part of their efforts under the
VPA, Ghana developed a national traceability system,
the Ghana Wood Tracking System (WTS), to track the
trade of timber and to ensure that timber entering the
supply chain is legally sourced. The electronic systemmonitors chain of custody from forest to export orplacing on the domestic market, collects data oncompliance by operators at critical control points, andraises potential breaches allowing for controls andfield verification.

Central collection and access point of information
In recent years, there has been a proliferation oftransparency instruments, including databases,
dashboards, scorecards, traceability platforms,
interactive maps and independent monitoringorganisations. The cocoa supply chain is no exception
to this trend, even if the general sentiment remains
one of opacity. And an increasing number of actors,
especially in downstream stages of the supply chain,can feel disoriented by the increasing variety of
information sources.

Information collected through the WTS is shared withstakeholder groups through various data portals. The
Forestry Commission has developed an internal
dashboard to support compliance monitoring,decision making, and to inform policy. With CSOs, theForestry Commission also developed portals to makeinformation available for use by industry actors and the
public. EU competent authorities can also accessinformation from the WTS through a designated portal
to validate issued legality licences.

Having the main reference information in one
place recognised by the main stakeholders, in one
online platform, organised, accessible and ideally
hosted by an institution in government or mandated
by it, is key to help supply chain actors navigate
through the proliferation of information and data
sources.
The creation of a central point of information hosted
by a government institution can also become aconcrete accelerator for improving the interoperability
between different public and private data sources(including certification data), while recognising the
primary source and ultimate data holder for eachdataset. It can accelerate the development and use ofcommon reporting formats.

The Ghana WTS has been lauded as a major successin the sector, with many commending theparticipatory, deliberative, multistakeholder processthat was establishedin
its development.
Functionalities with varying levels of information
disclosure – such as data portals – were developed tomeet the needs of stakeholder groups, facilitating

Furthermore, it can be the opportunity for supplychain stakeholders to set up practical and harmonised
9

ways of connecting supply-chain information(traceability data) with sustainability information (dataon forest protection or deforestation, for instance).
Integrating traceability information with, for instance,
impacts on forests - be they negative (deforestation) or
positive (forest protection or reforestation), poses
important challenges that are more likely to beaddressed with a centralised traceability information
system. For instance, in the absence of systematic
farm-level deforestation data, deforestation risks canbe assessed at the level of a production landscape or
region, which then can be linked to supply chain datawhen pooled together.

-

-

-

Finally, a central point of information can also support
the existence of an effective complaint mechanism,
which can further boost the trust and credibility in thecocoa sector.
Summary-

The way collected data is reported requires carefulconsideration. Some sensitive or confidential data is
best reported to independent monitoringorganisations. Other data is best disclosed publicly.
Additionally, a central collection of data by agovernment agency can provide clarity about thevarious streams of data that are reported, function as
an accelerator for more transparency, help connect
sustainability with supply-chain data while
supporting effective complaint mechanisms.

-

Part 4: How can the different
stakeholders contribute?

-

The above-mentioned action proposals require valiant
and collaborative efforts from all actors in the supply
chain. The recommendations below highlight some of
the main contributions that each stakeholder groupcan bring to improve cocoa transparency andaccountability.

Cocoa producing
recommended to:-governments

-

are
-

Implement national traceability approaches that
respond to the needs of supply chain actors,
10

ensure the interoperability with existing data
management systems, and enable full traceability
to the cocoa plot.
Create a central point of information or a national
platform that hosts reference data on traceability
and sustainability in the cocoa supply chain andprovides differentiated access modalities to supply
chain actors, based on their needs.
Disclose methodologies and approaches for
supply chain data collection, including for farmdata, and clear data management and ownershipframeworks.
Publish and regularly update reference data
related to cocoa production and trade that can
support supply chain actors’ decision making, suchas cocoa production statistics at sub-national level,
and aggregated and anonymised farmer data
statistics on farm size, average yields, costs ofproduction, diversified production, etc.
Publish and regularly update relevant spatial
information that can support cocoa supply chain
actors’ risk assessments, such as protected areas
and forest boundary maps, forest and crop maps,
aggregated annual cocoa production maps andcocoa asset maps (cooperatives, warehouses,etc.). Ensure that this data is accessible, verifiable
and up to international standards andmethodologies.
Implement a national forest monitoring anddeforestation alert system, associated with clear
processes for ground verification, control
mechanisms, sanctions and reporting.
Establish a governance framework for traceability
that guarantees the participation of supply chain
actors, that includes the role of independent
monitoring organisation(s) in providing third-party
verification and foresees a complaint mechanism.
Establish national reporting frameworks on
sectoral progress to address child labour.
Disclose annually the tonnages of cocoa sold,price received for cocoa sales, including all
differentials, and price setup of farm gate price vs.
world market price.
Report annually on the use of cocoa tax revenues.

are

-

Disclosure cocoa import statistics and cooperatewith producing countries’ customs authorities.
Establish mutually benefiting and ambitious
partnerships with producing countries, thatincentivise transparency and accountability whiletargeting the roots causes of cocoa-related
deforestation and child labour, such as living
income and poor land-use governance.
Supportmultistakeholder
engagementat
producing country level and representation of civilsociety and farmers.
Provide sustained financial and technical support
to build producing country capacity, policies andtools for cocoa traceability and sustainability, witha focus on smallholders.
Communicate clear expectations and guidelines
for compliance with consumer country regulation.

-

Cocoa consumer
recommended to:
-

-

-

-

governments--

Certification bodies are recommended
to:

Cocoa traders and manufacturers arerecommended to:
-

-

-

-

Report on risks identified, volumes sourced thataredeemednon-compliant
(e.g.
not
deforestation-free), and actions undertaken.
Report annually on the number of children
identified as being in child labour and those
remediated out of child labour in their supply
chain, as well as how much of their supply chain iscovered by their CLMRS.
Report annually on tonnages of cocoa sourced bycountry/terminal market and disclose payments of
Living Income Differential and other differentials,
including country differentials and certification
premiums.
Disclose data to independent monitoringorganisations when needed.
Support farmer organisations’ capacity toparticipate in traceability system design andmanagement.

-

Annually disclose supply chain information,
following norms established by the Accountability
Framework initiative. These include the identity
and location of tier-1 (traders) & tier-2 suppliers(cooperatives/farmer groups), volumes sourced
per tier-2 suppliers, volumes sourced bycertification system, and volumes sourced
directly/indirectly.
Publish aggregated annual cocoa production
maps based on companies’ traceability systems
and share plot-level data with producing
governments.
Publish data and methodologies used for the
spatial monitoring of their supply areas whencompany systems exist.
Align company sustainability frameworks andforest monitoring efforts to nationally agreed
definitions and standards, as well as to the
Accountability Framework initiative guidelines ontransparency disclosure guidelines.

-

Publish the volumes and origin of certified cocoa.
Publish farm gate prices and premiums received
by cooperatives and farmers.
Publish major risks identified per cocoa sourcing
region and the incidence of these major risks.

Civil
societyorganisations
academia are recommended to:
-

-

-

11

and

Structure and implement third-party monitoring of
cocoa traceability systems and sustainability risks.
Support farmer organisations’ capacity toparticipate in traceability system design andmanagement.
Support the continuous improvement of forest
monitoring and cocoa detection methodologies
and approaches.
Make available open source and robust data tosustain the objectives and actions described in thispaper.

Colophon
Text: Adeline Dontenville (EFI), Thomas Sembres (EFI)
Editor: Antonie C. Fountain
Citation: Dontenville, A., Sembres, T., Fountain, A.C., Transparency and accountability. Towards building
trust in the cocoa sector’s sustainability efforts, 2022.
Additional contribution by: Mariana Broitman (Fairfood), Jinke van Dam (Tropenbos International),
Erasmus zu Ermgassen (UCLouvain/Trase), Michaela Foster (EFI), Steffen Fritz (IIASA), Christiane Hellar(Hamburger Stiftung fuer Wirtschaftsethik), Cécile Lachaux (WWF), Ian McCallum (IIASA), Cécile Renier(UCLouvain/Trase), Johannes Pirker (IIASA), Fabienne Yver (EFI).
Published by the Cocoa Barometer Consortium.
Administered by the VOICE Network.
The Cocoa Barometer Consortium consists of ABVV/Horval, ACE Japan, Be Slavery Free, EcoCare,
European Federation of Food, Agriculture and Tourism Trade Unions (EFFAT), Fair World Project, Fern,
Global Labor Justice/International Labor Rights Forum, Green America, Inades Formation, INKOTAnetzwerk, Mighty Earth, Oxfam America, Oxfam Belgium, Oxfam Ghana, Public Eye, Rikolto, SEND West
Africa, Solidaridad Europe, Solidaridad West Africa, SÜDWIND Institut, Tropenbos International, Tropenbos
Ghana, WWF France
Contact
Requests for information can be addressed to:Antonie Fountain - VOICE Network antonie@voicenetwork.cc
The final responsibility for the content and the views expressed in this publication lies solely with theauthors.
This publication is based on publicly available data and off-record information provided to the authors. The
authors welcome any corrections to data provided and challenge all actors of the cocoa sector to be much
more forthcoming with public data on the core challenges the sector faces.
This paper is a Consultation Paper for the 2022 Cocoa Barometer, which is to be released in December
2022. The authors welcome any input, corrections and/or feedback on the content of this paper.
We encourage the use of (parts of) this paper in other publications, provided proper references are
given. Published under Creative Commons License Attribution-ShareAlike 4.0 International.

12References
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