Memorandum submitted by Masterfoods UK
1. EXECUTIVE
SUMMARY
1.1 Masterfoods UK is part of Mars Incorporated,
and produces some of Britain's best-loved confectionery brands
including Mars, Snickers and Galaxy. We are committed to producing
quality branded products and contributing to a sustainable global
and local environment. At Mars we view sustainability as a whole
business issue and our aim is to return a fair benefit to our
local and national communities, increasing their prosperity and
quality of life as we benefit from partnership with them.
1.2 Cocoa is the unique ingredient of chocolate
and at Mars we devote significant resources to ensuring the sustainability
of the whole cocoa supply chain to the mutual benefit of all those
it touches. Our Cocoa Sustainability Programme embraces a holistic,
proactive set of activities designed to ensure future supplies
of cocoa and a responsible approach to its production so that
the community and environment in which it is grown can thrive.
1.3 Our experience of operating in the cocoa
supply chain confirms to us that agricultural development, and
in particular working in public-private partnerships, can make
a tangible and lasting contribution to achieving the Gleneagles
G8 objectives and beyond that the Millennium Development Goals.
Masterfoods supports the key point made by Business Action for
Africa in response to the Eliminating World Poverty White Paper:
"... It is only private-sector led growth that can finally
and forever make poverty history."
1.4 Our privately owned company's heritage
is based on a genuine commitment to the communities that are touched
by our business. Furthermore we have taken a leadership role in
our industry's efforts to ensure a sustainable future for the
family farms where many of our products begin. This also includes
us working closely with the Biscuit, Cake, Chocolate and Confectionery
Association (BCCCA) on all aspects of cocoa, and we support their
response to the Committee as part of this inquiry. Nevertheless,
we would like to offer several additional comments in response
to a number of your questions.
MASTERFOODS UK'S
RESPONSE TO:
2. How can aid be more effectively mobilised
to help producers improve the quality of their produce in order
to access fair trade markets?
2.1 In the cocoa sector we have experience
of a number of development initiatives including establishing
public-private partnerships to address the specific needs of farming
communities, the most prominent example of which is the Sustainable
Tree Crops Program (STCP). It is our experience that successful
and sustainable futures are grounded in partnerships that share
expertise.
2.2 One example that demonstrates the opportunity
for business to support ethical trading is demonstrated by the
International Cocoa Initiative (ICI), an organisation dedicated
to achieving social improvements in the cocoa supply chain. The
ICI illustrates how industry and NGOs can collaborate towards
common development goals.
2.3 Appropriate working conditions are a
prerequisite for a sustainable supply chain and—together
with its industry partners, national governments of growing countries,
labour experts and community based organisations—Mars is
supporting the establishment of a certification process in Cote
d'Ivoire and Ghana (the world's largest cocoa growing countries)
in order to ensure that cocoa is not only farmed free from the
worst forms of child labour, but also that the working conditions
are as sustainable as possible.
2.4 Creating an exchange of information
and knowledge between global experts and experts at "ground
level" is also an important development initiative. The STCP
is actively facilitating knowledge transfer both at the top level
of sharing scientific research amongst country experts and also
through Farmer Field Schools at the practical micro farm level.
MASTERFOODS UK'S
RESPONSE TO:
3. How does the international trade system
impact on ethical and fair trade production?
3.1 A fundamental macro-economic objective
must be an equitable trading system that provides access to markets
whilst at the same time allowing freedom of choice, for example
to use such channels as Fair Trade. Agriculture has a key role
to play in creating economic growth in developing countries but
will struggle to flourish in the absence of stable governments,
good governance structures and transparency that must be accompanied
by investment in infrastructure, including educational provision.
The role for donor support in achieving agro-economic growth must
not be under-estimated.
MASTERFOODS UK'S
RESPONSE TO:
4. Do existing government guidelines on procurement
of ethical and fair trade products provide an enabling environment
for the development of this market and the opportunities for producers?
4.1 Support for Fair Trade by UK government
departments is an example of policy into action. However it is
important to note that there are also other ethical trading models.
Examples of these, in which we are involved as part of our cocoa
sourcing, are explored in more detail below. We would be pleased
to see the UK Government provide even more support for these models
of ethical trading and development, which are best viewed as complementary
to Fair Trade initiatives rather than in competition with them.
4.2 Labour Certification is an important
ethical trading model. It is a system to monitor, track and drive
labour practice in the cocoa sector that is under development
by the global chocolate and cocoa industry in partnership with
West African governments, labour specialists and other interested
NGOs/CBOs.
4.3 The STCP, a public-private partnership
between the cocoa and chocolate industry and government donors
has successfully supported farmers' organisations and co-operatives
leading to improvements in the supply chain. Many farmers, when
better organised, are able to achieve better prices for their
cocoa. For example, in Cameroon participating farm families saw
their incomes increase by up to 55% in 2004, and in Cote d'Ivoire
where there is a different farm levy structure average cocoa farm
income rose by 24%.
4.4 A further initiative under the STCP
seeks to improve farming techniques through Farmer Field Schools.
Losses to pests and diseases averaging 30% annually pose an ever-present
threat for cocoa farmers. At Farmer Field Schools smallholders
learn skills to combat this threat leading to improved yields
and hence income gains.
4.5 For any agricultural supply chain to
be sustainable there must also be investment in local infrastructures,
in particular investment in education. We recognise this to be
the case in the cocoa sector and have sought public-private partnerships
to deliver appropriate training. For example, Mars is working
in partnership with Winrock International and others to deliver
vocational skills to school children in Cote d'Ivoire providing
today's students with the opportunity to become better farmers
of tomorrow.
February 2007
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