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The True Cost of Cocoa – Tony’s Chocolonely Progress Report 2018

Impact Institute* and Tony’s Chocolonely have a multi-year collaboration. In 2013, Impact Institute on behalf of True Price carried out an analysis for Tony’s Chocolonely in which the social and environmental costs of a conventional chocolate bar and a Tony’s Chocolonely chocolate bar were calculated. In 2013, Tony’s performed 44% better than the sector cocoa. Now we have published an extensive report that tracks the performance of Tony’s Chocolonely. While the current true cocoa cost for both Tony’s Chocolonely and the sector benchmark show improvement since 2013, there is still work to be done to have lower true costs and more sustainable cocoa.

Tony’s Chocolonely cocoa is more sustainable than the average cocoa

Impact Institute found that the true cost of cocoa for Tony’s Chocolonely farms in 2017 is €4.52 per kilogram. This is 54% lower than the true cost of the (weighted) average cocoa in Côte d’Ivoire and Ghana (true cost of €9.91) and is an 43% improvement compared to the Tony’s Chocolonely farms in 2013 (true cost of €7.93).

This is mainly because Tony’s Chocolonely performs better on the impacts underearning of smallholder farmers (that receive a Tony’s Chocolonely premium), child labor and forced labor (that Tony’s Chocolonely actively seek to prevent). In addition, Tony’s Chocolonely’s farms have higher yields, which also helps to reduce the true costs per kilogram cocoa. As the cacao sector is unable to provide a living income for farmers and uses child and forced labor, more work needs to be done.

Tony’s Chocolonely has improved since 2013, but there are still external costs

While the results of this study show that real progress has been made over the years, external costs remain. Impact Institute’s work with Tony’s Chocolonely provides valuable insights into the opportunities for progress and improvement for the chocolate sector.

In moving forward, there are several actions which can help drive down external costs further. First, more targeted attention should be given to specific costs so to have a more focused effort. Costs such as those from underearning of smallholder farmers and child labor have been a persistent challenge within the cocoa industry, and would benefit from more focused attention. Second, and connected with this, is developing further methods for measuring progress made on these costs. Third, once progress is more clearly measurable, they can be addressed, and progress can be steered at a company level. Finally, reporting mechanisms can be strengthened on these three areas for improvement to share knowledge and best practices.

*Impact Institute was working under its former name True Price.

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