Are Major Companies Putting Revenue before Human Welfare?

The Ninth U.S. Circuit Court of Appeals has ruled against major chocolate producers Nestle, ADM, and Cargill, holding them accountable for any production that condones international child slave labor. The Court of Appeals stated that the companies knew they were fueling child labor in the Ivory Coast, but their main goal was “obtaining the cheapest cocoa possible, even if it meant facilitating child slavery.”

“Atrocities against mankind such as child slavery only underscore the need for global companies to have visibility into their operations on foreign soil,” commented Lina Ramos, Chief Business Officer at Source. “We’ve seen a trend of global companies coming to us to put due diligence processes and systems in place to identify any unethical or illegal manufacturing practices.”

Three former slave laborers for the cocoa farms had initially filed this lawsuit in July 2005, against the three major manufactures for working without pay for hours and days on end, with abusive treatment and malnourishment. The lawsuit was based off the 1789 law that allowed lawsuits in U.S. courts if there were human rights violations oversees.

The Ivory Coast is responsible for 70% of the world’s cocoa production, and these three companies “effectively control the production of Ivorian cocoa.” The legal system has taken a position: companies such as Nestle should be held accountable for their supply chain injustices that occur internationally.

Similar to labor issues disputed in this court of appeals ruling, companies are also being scrutinized for potentially sourcing minerals from conflicted regions, namely the Democratic Republic of the Congo and surrounding countries. The Dodd-Frank Act requires companies to provide transparency into corporate practices in order to mitigate funding for armed groups involved in human rights violations in that region.

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Source Intelligence® Contact:

Lina Ramos, Chief Business Officer

(877) 916 6337 ext. 1017

lramos@sourceintelligence.com