From bean to bar: Building transparent cocoa supply chains
From partnering with family-run farms to national governments, global food business Cargill is working to make cocoa production more sustainable. By developing together a digital reporting platform, we’re boosting transparency that’s protecting the future of farmers, their communities and the planet.
Worldwide, the chocolate industry continues to grow – and so does our appetite for understanding the ingredients in the confectionery we buy. However, with cocoa supply chains spanning continents and countless markets, they can harbour serious human rights and environmental challenges, like fair wages and deforestation.
Mitigating these issues would be much easier if producers could trace the origin of every cacao bean.
Feeding the world more responsibly
As the largest privately held company in the United States in terms of revenue, Cargill serves customers in more than 125 countries across five continents. It is committed to feeding the world in a responsible way, which includes a goal of 100% farm-to-factory traceability for all beans in its direct sourcing network by 2030.
To achieve this Cargill launched its Cocoawise™ digital reporting platform. The interactive portal, developed with Deloitte, uses multiple data sources to track the journey made by its cacao beans. Customers worldwide, such as major food and beverage brands, can now see where, how and by whom crops are grown and processed, increasing transparency and trust.
Cargill buys its beans from 170,000 smallholders in Ghana, Côte d’Ivoire, Cameroon, Brazil, Ecuador and Indonesia. These are then transported in bulk around the world. The more it knows about its ingredients and the supply chain, the more Cargill can do to manage quality, sustainability and environmental impact.
The insights and human stories shared via the portal also help customers see the developments being made in cocoa farming, so they can connect with those communities and progress their own environmental, social and governance goals.
A data-driven picture of sustainability
Led by Deloitte Netherlands, the project called for expertise across IT, data, strategy and risk. Consulting partner Patrick Schunck says: “In recent years, sustainability has become core to Cargill’s strategy as it realises the size of the impact it can have. For us, it wasn’t so much delivering the idea – Cargill knew what it wanted – it was co-developing the solution and bringing it to life.”
The portal pulls data from a centralised Cargill platform fed by a range of digital tools. It includes the company’s own information on suppliers, processes and logistics, plus a layer of external data on for instance human rights violations, or environmental and weather conditions. As an example, information drawn from geospatial mapping can show changes in tree cover on suppliers’ farms, indicating areas of deforestation.
By building a real-time picture of what’s happening on the ground, the company can also see where its impact can be increased.
The Cargill Cocoa Promise is a programme of activities that supports growers and their communities so they can improve their incomes and living standards through more sustainable practices. Cargill has, for example, reached 244,364 farmers through coaching and training. The programme also helps to empower women with technical training and access to finance and give children access to quality education.
“The impact on farmers, their livelihoods and the environment is clear, but this has also enabled Cargill to stay true to its customers - customers that value the important work it’s doing to nourish the world in a safe, responsible, sustainable way.”
Naser Bakhshi, Deloitte Netherlands
Enabling more accurate environmental reporting
The success of Cocoawise™ has resulted in two more platforms. Soyawise™ and Palmwise™ provide the same traceability and transparency for customers, but this time for sustainably-certified soya and palm oil purchases.
The three platforms allow Cargill to better understand and report on its Scope 1, 2 and 3 emissions and wider environmental performance. They will play an important part in meeting obligations under the EU’s Corporate Sustainability Reporting Directive, which is set to transform how companies report on a wide range of sustainability topics. The regulations, which come into force in 2024 for many organisations, are an opportunity for firms to future-proof themselves and deepen their understanding of sustainability opportunities and risks.
The EU Deforestation Regulation, which applies from the end of 2024, will also require companies trading in seven commodities, including cocoa, palm oil and soya, to understand their value chains in detail.
Deloitte Netherlands partner Naser Bakhshi leads the Data and AI team for clients in the consumer industry. He explains: “This has been Cargill’s journey – it had the vision and set the way forward – and the company is very proud of what it has achieved. By providing the right technical, strategic and change process capabilities, we were fortunate to be able to stand shoulder to shoulder with our client to ensure these projects were successful.”
Zero in on… Scope 1, 2 and 3
Scope 1, 2 and 3 is a way of categorising the different kinds of carbon emissions a company creates in its own operations, and in its wider value chain.
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This covers the Green House Gas (GHG) emissions that a company makes directly - for example while running its boilers and vehicles.
These are the emissions it makes indirectly - like when the electricity or energy it buys for heating and cooling buildings, is being produced on its behalf.
Now here’s where it gets tricky. In this category go all the emissions associated, not with the company itself, but that the organisation is indirectly responsible for, up and down its value chain. For example, from buying products from its suppliers, and from its products when customers use them. Emissions-wise, Scope 3 is nearly always the big one.
