How technology can provide conclusive and verifiable information

September 19, 2023

In this guest contribution feature for International Confectionery, Charlie Watkinson, General Manager, Technical and Commercial at Source Certain, Carolyn Kitto, Director at Be Slavery Free and Puvan Selvanathan, Founder and CEO at Bluenumber discuss how technology can be harnessed to provide verifiable information about sourced cocoa and address forced labour and deforestation in our supply chains

Introduction

In an era where the origins of products can be shrouded in complexity, the cocoa industry demands more than mere claims. The question arises: If you don’t know where your cocoa comes from, how is possible that it can be claimed to be sustainable, free from slave labour, or free from deforestation?

Yet, there is no silver bullet for businesses operating global supply chains to comply with the many new regulations being rapidly embedded and progressively enforced. The silver lining is the consensus and coherence between blocs on what to report about sustainability, deforestation, carbon, and human rights. It is already clear that gearing-up together to meet the EU’s trifecta of directives on deforestation, corporate sustainability, and due diligence would be significantly more cost-effective than addressing each separately. That’s why Be Slavery Free, Source Certain and Bluenumber are collaborating to work with businesses who want to eliminate deforestation and slavery from their supply chains.

Collaborative forces for change

Be Slavery Free is an Australian charity working to end modern slavery. It is behind the collaboration of three Universities, 40 NGOs from the global south and north and subject matters experts and consultants who produce the Chocolate Scorecard. It analyses different players in the cocoa supply chain on traceability and transparency as well as human rights and environmental indicators.

Source Certain, headquartered in Perth, Western Australia, is a pioneering laboratory specialising in scientific verification of product origins. Their methodology hinges on precise chemical analysis, allowing them to trace the provenance of consumables, timber, minerals, and more, down to the very location of their origin. This scientific approach provides a tangible means of confirming claims about a product’s journey.

Bluenumber, a registered 501(c)(3) nonprofit, is dedicated to offering verifiable data on working conditions as a means to identify and address risks associated with forced labor and human rights violations. Their approach involves creating a platform for direct worker feedback, enabling regular surveys aligned with International Labour Organization (ILO) indicators of forced labour. This departure from traditional social audits introduces a level of authenticity that cannot be staged, yielding concrete evidence of supply chain practices devoid of forced labor.

Trends in legislation

It has been known for a long time that the food we eat takes its toll on the planet and the people that produce it. For at least a quarter century, child labour has been an endemic issue in cocoa farming. The problem is most evident in West Africa where two thirds of the world’s cocoa is produced.

The relentless pressure to meet the demands of consumer nations has compelled the expansion of cocoa production into new territories, often at the cost of seeking the most economical labor available. Regrettably, this practice has contributed to a staggering 1.54 million children engaged in labor in West Africa. Moreover, the consequences extend to the detriment of the environment, with Côte d’Ivoire witnessing an 80% reduction and Ghana a 94% reduction in their forests due to this expansion.

The dynamics of responsibility in the cocoa supply chain have followed a pattern where each stakeholder passes the buck to the one above. Retailers defer to manufacturers, manufacturers to processors, processors to traders, and so on, creating a chain that culminates in farmers—the most crucial yet vulnerable link—being burdened with the bulk of responsibility. This convoluted approach not only places undue pressure on the weakest link in the chain but also muddles transparency at each stage.

Recognising these challenges, a monumental shift in regulatory philosophy is taking shape—one that acknowledges agribusiness as more than a mere amalgamation of fertilisers and finances. Buyers can no longer limit their accountability for environmental and social impacts to the quantity of a farmer’s yield they acquire. Rather, their responsibility extends across all purchases bearing their brand, irrespective of volume.

In the realm of corporate social responsibility, the European Union stands as a trailblazer. The European Union Deforestation Regulation (EUDR), in effect since June 29, 2023, offers businesses importing timber, soya, cocoa, coffee, beef, rubber, and palm oil into the EU a transitional period of 18 months to align with its rigorous compliance requirements. Notably, the EU has also taken proactive steps towards eradicating forced labor. A proposal submitted in September 2022 aims to prevent products produced through coercive means from entering the EU market, while a directive introduced in March 2023 addresses the issue of deceptive environmental claims, striving to counteract “greenwashing.”

Ensuring compliance: Leveraging independent sources and technological innovation

In the pursuit of compliance, businesses must pivot towards sourcing information from independent and credible origins. The current landscape has been shaped by the stark reality that suppliers often fail to self-report critical issues such as forced labor, deforestation, fraud, and illicit commodity practices.

Fortunately, technology developed for social media and satellite mapping, as well as forensic science, is more than capable of monitoring (‘M’) activity, reporting (‘R’) data and verifying (‘V’) claims and is available to businesses. MRV is the inevitable and necessary enhancement to make traceability meaningful. The traditional approach to MRV is increasingly granular auditing, then sampled and extrapolated for the region or sector, maybe once every 18 months or so. Simple mathematics shows that there are not enough auditors on the planet to MRV even a fraction of a fraction of ingredients and food the EU imports. Even if there were, and they were deployed in traditional fashion to audit all the cacao in West Africa to a sufficient degree for required compliance, their cost would be comparable to the value of cacao traded. It is prohibitive both from cost and reality perspectives.

Show the exact location of production of cocoa and chocolate with Source Certain

Businesses need a way to accurately identify cocoa from areas associated with deforestation. While mass balance analysis can hint at inconsistencies within the supply chain, remote sensing can pinpoint deforestation hotspots, and traceability tracks a product’s journey, a systemic environment of misrepresentation and laundering necessitates more robust measures for establishing provenance.

This is where Source Certain plays a pivotal role. It equips businesses with scientific tests that offer a resolute means to validate the authenticity of sourced products. Source Certain’s testing methodologies, renowned for their application in criminal investigations and authentication of diverse goods, extend a global reach. An illustrative instance is their involvement, upon the UK Government’s request, in verifying the origin of Ukrainian oilseeds and grain, thereby bolstering global food security amid geopolitical upheaval.

Recent research unveils a concerning underinvestment in traceability within West African cocoa, with over 55% of cocoa eluding linkage to cooperatives or departments. Complementing the stringent requisites of the EUDR, Source Certain’s innovative solutions accurately geolocate commodities. Land parcels below four hectares are precisely identified by latitude and longitude coordinates with six decimal places, while plots exceeding four hectares are captured using polygon boundaries.

Source Certain’s researchers have created rapid and low-cost methods using trace element profiling to differentiate cocoa nibs from specific farms and routinely offer ‘back to farm’ verification services that can show the exact location of production. Additionally, they’ve devised tests capable of validating claims about country and regional origins for dark chocolate bars. Notably, their current model attains an impressive accuracy rate of 99.6% in verifying the provenance of chocolate bars.

Direct Worker Voice and community verifiable polygon mapping for transparency – Bluenumber

The only way to MRV the agrifood sector is to digitally equip and enlist the billions of farmers, teachers, and villagers on the ground. If properly encouraged and incentivized to deliver any data necessary to contextualize their crop, they are the in-situ field force to handle the logistics of data gathering at scale. The ROI from training a community to report on itself and its achievements, thereby enable its own development as stewards of their own environment and defenders of their own human rights. The data writes stories that write themselves.

Polygon mapping can be used to assess if yield matches up with mass-balance declarations so cocoa with false origins does not enter supply. It can also be used to ensure that the land is owned legally, and to enable remote sensing to see if farms are spreading beyond their boundaries. However, mapping countless smallholder farms before full EUDR implementation poses costs and challenges.

Bluenumber transforms this landscape. It empowers farmers to define their polygon boundaries collaboratively with neighbours. This collective approach accelerates the process, fostering transparency in boundary-setting.

Bluenumber’s prime directive is facilitating Direct Worker Voice, enabling workers to share their experiences. This transparency enhances working conditions’ insight and cultivates accountability.

Harnessing Satellite Technology in Deforestation-Free Cocoa Supply Chains.

The adoption of remote sensing by major cocoa buyers as a tool for EUDR compliance is a positive step forward. However, remote sensing alone cannot guarantee the absence of deforestation within cocoa supply chains. For any technology to be effective, it must be part of a comprehensive ecosystem.

Effective problem-solving hinges on acknowledging the core issues. In the realm of forced labour and deforestation-linked cocoa, the following realities are crucial to grasp:

The cocoa industry lacks robust traceability systems.
There is large-scale laundering of deforestation-associated cocoa into clean cocoa supply.
Entities responsible for curbing deforestation-associated cocoa production lack sufficient powers and incentives.

The EUDR sets the deforestation/forest degradation cut-off as December 31, 2020. Legitimate cocoa-producing regions often remain untouched by deforestation, while forest degradation is primarily concentrated in national parks and classified forests—areas unlikely to be claimed as sourcing origins by cocoa buyers. Consequently, when seeking to prove that mapped farms are free from deforestation, remote sensing’s gaze will naturally align with these deforestation-free areas. This may create a blind spot where buyers could claim cocoa from locations tied to deforestation does not infiltrate their supply chains.

Scientific tests will be used by competent authorities as evidence of Operator due diligence.

Article 18 of the EUDR states that a competent authority may use “any technical and scientific means adequate to determine the species or the exact place where the relevant commodity or relevant product was produced, including anatomical, chemical or DNA analysis.”

At the forefront of this scientific endeavour, multiple research groups have been developing tests in the decade leading up to the EUDR entering into force. Timtrace, housed at the University of Wageningen, aligns its efforts with this cause, as does the World Forest ID initiative. The Advanced DNA Identification and Forensic Facility (ADIFF) at the University of Adelaide, the Center for Environmental Forensic Science at the University of Washington, the Von Thuenen Institute, and the Wood Identification and Screening Centre within the United States Fish & Wildlife Service are among the entities actively engaged in the development of tests to discern the species and provenance of regulated materials as mandated by the EUDR and other environmental protection laws.

Notably, these tests have already demonstrated their utility in upholding the EU Timber Regulation—precursor to the EUDR. As the latter assumes full authority across the European Union, these tests are poised to undergo further refinement and innovation. This ensures that competent authorities are provided with a gamut of options when submitting samples of regulated items for forensic evaluation, enabling them to validate the accuracy of claimed origins.

To embrace technology for compliance we will need support from the ground up.

Amid the imminent legislative changes, it’s vital to transcend the punitive perspective and recognise the unprecedented chance for transformative progress that lies ahead. The looming regulations are not just a matter of compliance; they represent an unparalleled opportunity for positive change—a change that can reverberate to the benefit of all stakeholders.

The challenges we face cannot be unravelled by a single technological thread. Rather, it’s the convergence of methods that holds the key – a fusion of direct worker voice, technology, and policy enhancements. Only through this collective effort can we effectively address these issues. It’s in this synergy that our solutions truly take shape, paving the way for comprehensive resolution.

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