The need for transparency and accountability in global supply chains

In December, the US Supreme Court heard arguments about whether Nestle USA and Cargill should be held responsible for child labor on the West African farms from which they buy their cocoa. The details of the specific case are devastating. Regardless of what the courts say on legal liability these companies might have in their home countries for such practices abroad—which is a mixed record across jurisdictions—there is no question that society is increasingly looking to global companies to take accountability in cases like these. Importantly for companies like Nestle and Cargill, the judges on the court of public opinion are also consumers and they can make decisions every time they go to the supermarket. 

 And yet before we can begin to address accountability, we have to acknowledge and remedy the dearth of reliable information–for consumers and, in many cases, for companies that are increasingly expected to be accountable for practices at all points in their supply chains, no matter how distant

Across many different supply chains, large, multinational companies are often unable to answer questions about their last mile suppliers and producers, typically facing a steep information cliff at the trader level. Solidaridad, an international nonprofit organization working to create fair and equitable supply chains, is working hand in hand with smallholder farmers, workers, and businesses to close those information gaps, while also supporting a more environmentally and socially sustainable economy for all.

Solidaridad has learned that several key factors lead to increased transparency and accountability in global supply chains. Supply chain transparency not only speaks to the interests of increasingly conscious consumers, it also reduces risks for companies. 

Solidaridad is leveraging digital tools that are locally-relevant, context and commodity specific. These tools are integrated in our programming to support producers to improve production and access finance, while simultaneously incentivizing the production of data. This can provide more supply chain insights, but importantly provides value to the producers and also protects their interests. Achieving all this can be a very fine balancing act, which Solidaridad is working to accomplish.

Cross sector collaboration leads to better outcomes

Solidaridad has been an active member of Bonsucro, a global multi-stakeholder nonprofit leading the way for sustainable sugarcane. In Bonsucro, farmers, producers, NGOs and big brands collaborate to support an increasing number of sugarcane producers in making their production sustainable. In an effort to make Bonsucro certification more attainable, the Farmer Support and Loyalty tool was developed, enabling farmers to fill out a brief survey that generates a tailored work plan report, while also capturing important information about groups of farmers. Gathering data at this level of the supply chain is a significant challenge, and this tool not only makes that data more available, it generates a value in return for the farmers and workers supplying it in the first place.

The concept of making data a two-way street—that isn’t only about extracting information from farmers, but ensuring that they benefit from the information they’re sharing—has permeated Solidaridad’s approach to supply chain transparency.

Information exchange creating value for all parties 

In Central America, the Top Cana project, rooted in the sugarcane sector, is a digital platform focused on the transfer of knowledge, including technical assistance, and providing training to rural producers and their families on farm management. The project also embraces the use of social media as a means for producers to ask questions to experts and share best practices with peers.

At the time of launch, Solidaridad’s Monique Vanni, remarked, “By using a digital platform to collect data and generate mechanisms for continual improvement, not only can we support producers in the field, but also build a platform where supply chain stakeholders can meet to exchange and align ideas.”

Allowing producer associations to apply shared knowledge to their own realities, and adapt their projects accordingly has led to improved soil management and the scaling of good agricultural practices. It has also led to greater take up of technical assistance and other services such as financing, facilitated by tailored and accessible information on the platform. Because incentivizing engagement, such as delivering information for great transparency in supply chains, is critical when farmers and workers weigh the many obligations they must meet each day.

Connecting the dots

Outside of agriculture, there is also a tremendous need for greater transparency in other supply chains, including minerals. In West Africa, Solidaridad launched The Gold Solution—a suite of digital tools designed to promote adoption of best practices by mines and miners, while improving their access to markets and finance and increasing the transparency of supply chains. The Gold Solution has three components:

  • An Interactive Voice Response platform compatible with basic feature and Android phones and allows miners to receive practical guidelines on responsible mining practices, such as safe working conditions, responsible use of mercury and environmental management in their local dialect.

  • An android-based application to help mine managers track responsible mining practices at their mining sites and also provide information to regulatory bodies on mines’ compliance to set standards.

  • A web dashboard for key stakeholders, such as industry actors, donors and credit institutions to track the activities of small-scale miners.

By connecting the dots from miner to mine to upstream actors, the quality of information through the supply chain is improved and relationships are strengthened.

An enabling environment for accountability

With millions more entering extremely vulnerable employment situations, the urgency is higher than ever to demand equitable and environmentally sustainable working conditions for all. The debate continues in courts about exactly how domestic companies are held accountable for wrongs committed abroad, and the loopholes that are created. And, regardless of the outcome, these conversations highlight an urgent need for greater transparency in supply chains, which can be facilitated through creative use of digital solutions, and fair and mutually beneficial exchanges of information. This potentially gives all of us—companies, producers, consumers, governments, non-profit organizations—tools to make better informed, smarter decisions along the road to best practices and to ultimately hold each other accountable, regardless of our reach in the world.  

Read more about our work in Cocoa.