Of the three certification groups, Utz, the Dutch label, rapidly became the leader in cocoa, at least in part because the organization had aimed at making Utz attractive enough to reach beyond the niche markets.
The organization began as a certification label for coffee — the original name was Utz Kapeh, a phrase that means “good coffee” in a Mayan language. It moved into cocoa in 2008.
The goal was to bring sustainability to mainstream cocoa production, with chief executive Han de Groot saying, “making a meaningful impact would only be possible if we could reach massive volumes.” Accordingly, the organization took several steps to entice big companies.
For one thing, the price of Utz cocoa was right: The “premium” that cocoa buyers paid for Utz certified cocoa was significantly lower than what buyers paid for Fairtrade cocoa — sometimes just half as much, according to figures published by the labels. Several food industry executives served on the Utz board, among them two former executives from Cargill, a major cocoa buyer.
Last year, about 65 percent of the world’s certified cocoa bore the Utz label.
Four auditing firms cited
While the word “certification” may suggest rigorous enforcement, however, the inspections are patchy and the incentives for fraud considerable, according to interviews with former Utz employees.
The recent trouble in Ivory Coast highlighted just how critical these problems can be.
Ivory Coast is the main source of Utz certified cocoa, and the four auditing firms cited by Utz for auditing problems were responsible for about 90 percent of the Utz farms there, according to figures provided to The Post.
Two of those auditing firms are based in Africa — AfriCert and Bureau Norme Audit; two others, Control Union and Bureau Veritas, are based in Europe. The auditing companies involved revealed little about why they received warnings from Utz.
Utz “found that our local auditors had failed to investigate thoroughly the non-compliances found,” Udi Gabay, regional manager in Africa for Control Union, the auditing firm received the most severe warning from Utz, said in a statement. “This was the result [of] a lack of supervision by local management.”
Control Union is seeking to be reauthorized as an Utz inspector.
A representative of AfriCert referred questions to Utz.
A Bureau Veritas representative said that there had been “weaknesses at the auditors level.”
A representative of Bureau Norme Audit said the firm remains a fully certified auditor for Utz.
The sanctions do not “mean that all activities (audits, certification decisions) were conducted incorrectly,” Utz said in a statement.
Even when the auditing firms are operating properly, however, the inspection system allows many farms to go unchecked.
At Utz — as at other certifiers — when a group of farmers seeks certification, only a small sample of the farms are inspected. For a typical co-op of 1,000 farmers seeking Utz certification, for example, auditors might inspect only about 32. Audits are generally announced in advance, a practice that allows farmers to hide evidence of any deviations from the rules.
Once at the farm, inspectors often face an array of challenges, according to former employees, beginning with the fact that farmers have a substantial financial incentive to fool the auditors: If they pass muster with Utz, they may receive about $80 extra per metric ton of cocoa they sell.
Lenneke Braam, who until June was head of standards and assurance at Utz and Rainforest Alliance, noted that the pressures on auditors can be extreme, including not just enticements such as bribes but also death threats.
“How many I cannot say,” she said of the death threats. “But it happens.”
At the root of the problem is the desperation of the farmers, said Lucas Simons, who was global program director at Utz in 2008. The question, he said, is whether the high-minded certification guidelines drafted in Europe or the United States can be enforced in a setting where illiteracy and poverty are widespread, and where basic infrastructure — roads and electricity — are often missing.
“These people are poor — for them it’s a matter of survival,” Simons explained. “If people cannot read or write, if they make just 70 cents a day, and we come with 35 pages of requirements that they must meet, we are not creating a sustainable economy.”
Marginal difference between farms
Even some of Utz’s own research provides further evidence that the inspection system is weak: In key ways, the farms that it approves in West Africa are little different from those that are not certified.
Twice, in 2013 and again in 2017, researchers from Wageningen University & Research surveyed hundreds of farmers in Ivory Coast and compared farmers certified by Utz with those who were not certified.
The results were not flattering.
On the issue of child labor, the Utz-certified farmers had more child laborers than farmers who lacked certification. About 14 percent of noncertified farmers told surveyors they had child labor; about 16 percent of Utz-certified farmers did.
On environmental issues, the researchers studied general practices, planting of shade trees and waste management. There were some ways that Utz farms looked better: Utz farmers were more likely to have planted shade trees, which are a recommended means to counter deforestation. The researchers also credited the certification program with disseminating agricultural knowledge beyond Utz farms.
But overall, the studies found, the “levels of impacts have generally been marginal for certified farmers.”
“There remains a gap between what certification alone has been expected to deliver and [what] actually has been delivered,” according to an academic paper the researchers published.
Other researchers were more blunt.
Charity Ryerson, co-founder of the nonprofit Corporate Accountability Lab, visited five cocoa villages in Ivory Coast over the past year and found little evidence of anyone checking that “certified” farms were operating according to standards. For example, she said, a checklist requiring clean bathrooms was fully checked in one report even though none of the farms has bathrooms.
“From our experience talking to farmers, it was clear that certification meant almost nothing,” Ryerson said. “It’s an open secret in the Ivory Coast that almost no one checks the certified farms for compliance.
“Certification misleads consumers to believe that farmers earn a living wage, their children go to school, and labor conditions are decent. From the perspective of a farmer living in abject poverty, this is morally outrageous.”