When we started our journey to better understand Coca-Cola’s sugar supply chain, we knew it would be a major undertaking. But an important one that would allow us to better understand and address key risks on child labor, forced labor and land rights. Since 2015, we’ve published five sugar studies to date, with more to come.
So where are we going from here? Translating our sugar study findings into a clear Action Plan. A process that requires strong internal alignment and close collaboration with our bottlers and suppliers. This is especially the case for a complex area such as land rights – an area that we have needed to not only acquire a clear understanding of the issues, but develop effective tools and processes that ensure alignment with our land rights policy.
Brazil Sugar Study
As one of top three sugar sourcing countries, Brazil served as an ideal country to more fully road-test the development of an Action Plan. Through the Brazil sugar study, which we published in January 2016, we were able to identify gaps and potential risks on land rights for our sugar suppliers:
Absence of policy: The study found that none of the participating mills had land rights policies in place related to land acquisition.
Land expansion: Nine mills had already expanded their lands over the last 10 years and seven currently have expansion plans.
Complexity in Brazil land tenure: The study found that complexities of Brazilian land tenure, environmental and indigenous law, especially in certain areas like the Northeast region, as well as other social and economic dimensions elevates risks for our suppliers operating in these areas.
Based on these findings, the company has developed an Action Plan, which is to also serve as a framework for other countries, addressing the above risks, and which includes three main components:
Development of Due Diligence and Guidance Tools
Supplier Guidance on Free, Prior and Informed Consent (FPIC): Working with our land rights knowledge partner, Landesa, we are developing FPIC guidance that will outline concrete steps to educate our suppliers on FPIC and help ensure adherence to the company’s policy. We will be publishing this FPIC guidance by the end of 2016 on Coca-Cola Journey. Although the FPIC guidance is intended to help safeguard against major conflicts arising from land transactions, disagreements or conflicts may still arise. Because of this, the FPIC guidance encourages suppliers to establish a monitoring and evaluation process as well as provide the community with access to a functioning and accessible grievance mechanism. Monitoring helps ensure that transactions are completed in line with the FPIC agreement.
Case studies on land rights: In partnership with Landesa, we will be developing global case studies on FPIC implementation in 2017, including on Brazil.
Continued Monitoring and Supplier Engagement
Audit protocols: Through our Supplier Guiding Principles (SGP), in 2016 we continue to monitor indicators related to land rights. Issues such as title, compensation, grievance mechanism and FPIC are captured in the audit reports under a separate land rights section. These audit protocol elements allow us to monitor land expansions and socialize our policy with suppliers. In addition, we are working with Bonsucro to refine their land rights indicators for their mill audits.
Strengthened communications: We are strengthening our communications with our Brazil sugar suppliers on social and land rights issues to address social issues, including issues raised in the sugar studies, i.e. expansion and land tenure complexity. We are focused on continued engagement on the Trapiche case, and working with counterparts at Oxfam, PepsiCo and local organizations on a positive resolution.
Ensure Greater Inclusion of Gender Issues and Land Rights and Increase Accessibility of our Studies and Findings
Building upon analysis in the Brazil sugar study on women and land rights questionnaires, we will work with our suppliers to provide additional context and information on the importance of land rights and women.
We will translate the Brazil sugar study and Action Plan and make it available on Coca-Cola Journey.
More broadly, we have generated significant learnings on our country studies over the past few years. We have sought and received feedback from a range of government, NGO and private sector stakeholders. We believe this input makes our work stronger. Two areas of improvement are on transparency and women and land rights.
Our studies have enabled a higher level of transparency, and we are committed to increasing information publicly available on our supply chain and due diligence processes. To that end, we are pleased to publish our sugar study methodology and sample mill and farm questionnaires on child labor, forced labor and land rights. In addition, this week, the company took a major step forward towards greater transparency by launching a Sourcing Map of our top agricultural ingredients, highlighting the locations where the company sources 11 of its top 14 ingredients.
For future studies, we will also work to ensure that the researchers are included in the report. In addition, the company will translate and make available the sugar studies in the country’s primary local language.
Women and Land Rights
Feedback from stakeholders emphasizes the importance of women’s access to land tenure. Specifically, that secure rights spur investments in the land, increase environmental stewardship, and add significantly to household wellbeing, particularly when women have land rights. Our sample questionnaires for researchers include various questions on women’s access to land and related issues.
We will also be working with the sugar study researchers to further underscore the importance of the gender dimension of land, and modify the Global Workplace Rights section of Coca-Cola Journey to include information on women and land.
Brent Wilton is director of global workplace rights at The Coca-Cola Company