Step 4 of the OECD due diligence framework is about making sure that your due diligence activities are effective. This chapter describes how companies in the cocoa sector can track the effectiveness of measures implemented to prevent and mitigate human rights risks and impacts such as child labour and forced labour in their supply chains.
Business Handbook on Due Diligence in the Cocoa Sector
Addressing Child Labour and Forced Labour
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Step 4: Track implementation and results
Abstract
Strategic questions for enterprises to ask
Are you using assessment and grievance data to track the progress of individual suppliers against risk management plans and measures for addressing child labour and forced labour?
For manufacturers, brands, retailers and in some cases processors, are you verifying that identified control points in the supply chain are conducting due diligence on the upstream portion of the supply chain in accordance with OECD recommendations?
For farmers and co‑operatives, traders, distributors, transporters or processors (when applicable), are you gathering feedback on whether human rights risks and impacts such child labour and forced labour are effectively being addressed?
Are you tracking cases of child labour and/or forced labour that have been identified and how those cases were handled (i.e. what prevention, mitigation and remediation was provided)?
Are you tracking progress and impact using appropriate qualitative and quantitative indicators? Those may be aligned with industry monitoring frameworks and government initiatives (e.g. National Action Plans), or developed in consultation with child labour and forced labour experts, trade unions, sector associations or multi-stakeholder initiatives?
Track implementation and results
Tracking and verifying how well due diligence is carried out is instrumental to reducing child labour and forced labour in your supply chain.
Monitor and track implementation and effectiveness of the company’s commitments, goals and activities on due diligence
Assign senior management oversight for ensuring responsibility for tracking and verification of the company’s due diligence efforts.
A sourcing office within a company may have the primary responsibility for tracking implementation of supplier assessments and corresponding corrective action plans for addressing child labour and forced labour that are time‑bound and outcome‑oriented.
A company’s buying department may hold the primary responsibility of tracking rates at which orders are placed late, changed, or cancelled – all practices which may contribute to actual and potential adverse impacts of child labour and forced labour with their suppliers.
Operational level staff may seek feedback from impacted stakeholders and rights holders on whether the adverse impacts have been addressed, for example through consulting local communities and authorities, community-based organisations for child protection and women’s empowerment, co‑operatives and workers’ representatives, through collecting feedback from people who attend meetings and forums, or taking note of issues brought to remediation procedures such as child labour and working conditions on cocoa farms.
Downstream companies should engage with companies and suppliers at control points (e.g. traders, grinders, cocoa importers and exporters) of the cocoa supply chain and assess their due diligence processes and actions.
Record any children referred to local services in the monitoring system, including the date referred and the date assistance was received. Follow-up with all cases referred to local services, to check if they received support, understand how their situation has evolved, and identify further support needs.
In cases of forced labour, companies may be required to publicly disclose them under mandatory disclosure legislation. Cases should be monitored and check-ins done with victims to ensure they receive support and to identify further needs.
What to track and verify?
When looking at what to track and verify, it is useful to consider standardised data collection and how to aggregate data for scale and convergence. One way to do so is to research which indicators and key data points producing country governments, industry or multi-stakeholder initiatives have put in place and to align with them, or to use them directly. National Action Plans (NAPs) and national level child labour survey reports with performance measures (outcome indicators, baseline, targets) can be a useful source.
Table 6. Examples of indicators to track
|
Examples of child labour indicators |
Examples of forced labour indicators |
|---|---|
|
# households and # children covered by a CLMRS or similar programme # cases of child labour identified # children identified in child labour who received support # children identified in child labour who received at least two follow-up visits # children no longer in child labour # households covered by another type of child labour system and impact of these systems |
# households reached by awareness-raising on forced labour # households covered by an assessment of forced labour risks # households with access to a grievance mechanism to support forced labour risks and cases # grievances reported in the past 12 months # co‑operatives with a forced labour policy in place # people trained on forced labour |
Note: Examples of the common child labour indicators agreed on by ICI and the European Platforms on Sustainable Cocoa (ISCOs).
Carry out assessments of the supply chain
Supply chains are dynamic and can be affected by multiple factors including climate change, epidemics, and other vulnerabilities. Sourcing for cocoa beans can shift quite suddenly changing the risk level involved. Companies need to stay abreast of these changes and adapt their due diligence strategies appropriately. Some companies in the cocoa sector are piloting satellite and LiDAR mapping to provide real-time data and more accurate traceability information, as well as on risks such as deforestation. This helps provide insights into how cocoa is driving deforestation that may also hold a higher risk of forced labour (Myers, 2019[35]).
Downstream companies should engage suppliers and business partners operating at control points of the supply chain to verify that their risk mitigation measures with regards to child labour and forced labour are up-to-date, and that incidences of child labour and forced labour have been addressed. Establishing a system for regular transfer of information from upstream to downstream enterprises is crucial for promoting transparency in the supply chain over time.
Consult and engage impacted or potentially impacted rightsholders
Stakeholder engagement is an integral part of the OECD due diligence process. Tracking and verification systems are strengthened when they engage stakeholders such as internal staff, representatives of co‑operatives and farmers’ groups, civil society organisations, workers’ representatives, local community leaders and government authorities.
In the context of child labour and forced labour it is important to engage with farmers and farmers’ groups, farming families and parents – especially those representing women, civil society organisations working on child labour and forced labour issues, workers’ representatives, trade unions and labour leaders, local community leaders, schools, government authorities and agencies including those responsible for child protection and labour rights. These groups should be regularly consulted and engaged to monitor and update information on child labour and forced labour issues.
Downstream companies may wish to work with local and international NGOs experienced in child and labour issues, as well as industry associations and initiatives operating on the ground. Children identified in child labour can be consulted and engaged through household visits, to understand their current situation and work status and monitor any changes, is key. This is a core part of monitoring systems such as CLMRS, which requires regular follow-up visits until a child can be considered “withdrawn” from child labour according to the criteria previously documented.
Conduct periodic reviews of multi-stakeholder and industry initiatives of which the enterprise is a member
The cocoa sector has a number of multi-stakeholder and industry level sustainable cocoa initiatives which can support companies, in particular those companies many tiers removed from the production of cocoa, in conducting due diligence to address child labour and forced labour. These initiatives should be assessed periodically by participating companies as due diligence remains the responsibility of companies themselves. Companies participating or using such initiatives to complement their due diligence actions should check that these initiatives are aligned with OECD recommendations on due diligence.1
Include feedback of lessons learned into the enterprise’s due diligence to continuously improve the process and outcomes
Companies should undertake a broader assessment of overall due diligence efforts periodically, including through third-party audits by competent and accredited independent parties who are knowledgeable and experienced in child labour and forced labour verification.
Third-party audits are most effective when they are independent, competent and accountable, and conducted in line with OECD recommendations. They should cover, for instance, chain of custody systems, including an evaluation of the quality of documentation, information on child labour and working conditions at the farm level.
Box 7. Considerations if you are a...
Processor (when applicable), trader, distributor, transporter, farm and co‑operative:
Ensure your downstream buyers know how you verify and collect information, including the type of data collected (see Table 6), frequency of collection and who you work with in obtaining that data.
Be honest in communicating what information you do not have, and why you do not have it.
Discuss with downstream buyers how they may support your data collection activities, and resources you need. If their leverage is greater than your own, ask for their support to utilise their leverage and capacity.
Identify and support existing CLMRS and human rights grievance mechanisms and support expansion and coverage.
Manufacturer, brand, retailer (and in some cases processors):
Organise regular meetings with your suppliers, in particular those operating at control points of the supply (e.g. traders, grinders, cocoa importers and exporters) to assess their due diligence efforts to address child labour and forced labour risks and adverse impacts.
Identify local NGOs, international organisations with expertise in working on child labour and forced labour cases, and who are knowledgeable of the communities; speak to them regularly to verify that the information you receive from suppliers is accurate.
Involve local NGOs and/or trade unions to support ongoing monitoring systems on farms.
SMEs
Upstream SMEs should understand the type and frequency of data needed to fulfil buyer or legal compliance requests. Seek ways in which data can be pooled across customers, or how technology can be used to increase efficiency and get best value for effort.
Upstream SMEs should incorporate the process of tracking and verifying effectiveness data into existing community-based or supply chain systems, such as the CLMRS. This ensures that feedback from internal and external sources is incorporated into the tracking of the process and helps to address potential financial and/or capacity concerns.
SMEs, regardless of their position in the supply chain, should consider using tools and standardised indicators from industry or multi-stakeholder initiatives they may be part of. This reduces duplication of efforts while helping pool leverage and resources.
Robust, long-term processes are needed within a company for tracking and verifying the effectiveness of due diligence. Downstream SMEs should consider establishing permanent business relations with their suppliers as the best means for a continual flow of tracking and verification information.
Note
← 1. To learn more about OECD Alignment Assessment, visit https://www.oecd.org/corporate/industry-initiatives-alignment-assessment.htm