How Nestle is Creating Better Lives for its Cocoa Farmers
A study by the KIT Institute into the programme reveals that high-quality pruning of income accelerator cocoa farms has contributed to a 32% increase in cocoa yields. The total net income of income accelerator households rose by 38%, resulting in a higher proportion of these households achieving a living income.
The program, spanning 28 cooperatives and 2,000 households in Côte d'Ivoire, has also effectively mitigated diseases, diversified incomes, empowered women, and enhanced child schooling rates.
The report is based on a study conducted over the first 18 months of the programme, examining a sample of 2,000 households across 28 cooperatives.
How has the programme helped procurement at Nestlé?
The Nestlé income accelerator test-at-scale, launched in January 2022, with the aim to help close the living income gap for cocoa-farming families and tackle child labour risks.
It encourages behavioural change and rewards positive practices, offering incentives for enrolling children in school, adopting good agricultural practices, participating in agroforestry activities, and diversifying sources of income.
The program's impact study found it effectively mitigated diseases and pests on farms, facilitated income diversification, promoted financial access, and increased child schooling rates by 10%.
There was a notable surge in small business investment, with the proportion of households investing in ventures like agro-processing, boutiques, barber shops, or soap-making doubling from 2022 to 2023, from 21% to 55%.
The program also promotes women's financial inclusion by facilitating their participation in Village Savings and Loans Associations (VSLAs). These associations provide opportunities for savings and loans, with a particular focus on women looking to start or expand their own business. They offer various training on topics such as gender equality and entrepreneurship.
The study highlights a 52% increase in the number of women enrolled in these associations.
"The test-at-scale of Nestlé's income accelerator program has confirmed the initial results we saw in the pilot phase," says Darrell High, Global Cocoa Manager at Nestlé.
"The program is transforming the way cocoa is farmed by professionalising labour and ensuring trees are pruned. It is great to see that these professionally pruned farms deliver higher yields which translates to higher income for cocoa-farming families.
“By putting the family at the centre of the program, we empower women who are supporting their children's education and are pursuing opportunities to diversify their household's income.
“We are continuing to gather feedback from the farming families, to learn and adapt the program accordingly. We are excited to have started to scale the program to 30,000 farming households and will continue to report on our progress."
The program has so far supported more than 10,000 families in Côte d'Ivoire and is expanding to Ghana in 2024 to include a total of 30,000 families.
By 2030, the program aims to reach an estimated 160,000 cocoa-farming families in Nestlé's global cocoa supply chain to create impact at scale.
Nestlé and it's wider commitment to improving supply chain management
Nestlé's commitment to betterment extends beyond this program. It's part of their broader efforts to improve their supply and value chains and reduce carbon emissions, with a commitment to reach net zero by 2050.
This includes advancing the production and sourcing of raw materials and achieving greater supply chain transparency.
As of the end of 2023, 91.9% of electricity in Nestlé's global manufacturing sites was from renewable sources, with a goal to reach 100%. Additionally, Nestlé New Zealand has achieved its goal of sourcing 100% renewable energy.
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