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Too little, too late on slave labor in coffee?

2016-03-04 Comments Off on Too little, too late on slave labor in coffee?

Yesterday we published this reflection on Section 910 of the Trade Facilitation and Trade Enforcement Act of 2015—a measure that ends coffee’s 85-year-old exemption from the U.S. ban on the importation of goods produced by slave labor.

By now, most readers will have seen this blistering report from the Danish human rights organization Danwatch on modern slavery in Brazil’s coffee sector.

Regular readers of this blog will know, Brazil has been investing for more than 20 years to create precisely the kinds of tools that the coffee sector needs to keep coffee produced by slave labor out of its supply chains.  The tools it will need to comply with the terms of Section 910.  There’s only one problem: the coffee sector hasn’t really used them.  And now that the coffee sector desperately needs them, it may be too late.


The Dirty List

In 2003, Brazil’s Ministry of Labor and Employment (MTE) created an Employer Register, popularly known in Brazil as the “Dirty List,” that publicly identifies factories, farms and firms found by its inspectors to be profiting from what the country’s penal code calls modern slavery.  For years, the Dirty List included a small number of coffee farms.  When I started sharing the Dirty List privately with allies in the coffee sector in late 2013, few of them had ever heard of it and it seemed that none of them was using it to inform their purchasing decisions in Brazil.  Now that they really need it, it may be too late: the Dirty List was suspended by a Supreme Court injunction during the final days of 2014 and there is no timetable for its reinstatement.

There are work-arounds.

Friends of ours in Brazil—the Institute for the National Pact to Eradicate Slave Labor and Repórter Brasil—filed the Brazilian equivalent of a Freedom of Information Act request to access the information that would have been published if the Dirty List hadn’t been suspended.  It seems the country’s commitment to transparency is just as deep as its commitment to worker protections, because the request was granted.  The two organizations now publish what they call the Transparency List of Slave Labor.  We call it an “unofficial-official” Dirty List: it is NOT an official list published by the MTE, but it IS based on official MTE data.  It may NOT hold the same legal weight as the Dirty List did, but it can inform corporate decision-making just as effectively.


InPacto—The Institute for the National Pact to Eradicate Slave Labor

The Walk Free Foundation, in the 2014 edition of its Global Slavery Index, ranked Brazil second in the world for its efforts to enlist the private sector in it campaign to end modern slavery.  Only the United States scored better.  A big reason why is the National Pact to Eradicate Slave Labor, an innovative platform for private-sector engagement among companies committed to eliminate slave labor from their supply chains.

At its peak, more than 300 companies representing over 30 percent of the country’s GDP had signed onto the National Pact, making a public commitment to eradicate slave labor from their supply chains and report annually on their efforts to do so.  They included leading Brazilian firms from diverse sectors of the economy and Brazilian subsidiaries of multinational companies.  But no coffee companies.  Again, now that they really need it, it may be too late.

In 2014, the National Pact went through a process of institutional reengineering.  The process put the National Pact on more solid footing for the long haul, but it has meant some growing pains over the short term.  Companies no longer simply sign the National Pact and commit to its provisions.  They must become dues-paying members of the Institute for the National Pact to Eradicate Slave Labor (InPacto).  The transition from the National Pact to InPacto member has meant starting over from scratch in building up membership.  InPacto has built back a strong core of private-sector partners under its new format, but still no coffee companies have signed on.


Putting these tools to use

Given the big news out of Washington last week, these tools seem more important than ever for U.S. coffee companies that want to stay on the right side of the law (to say nothing of getting on the right side of history). Is it too late for the coffee industry to put them to use in eradicating slave labor from the country’s coffee supply chains?  Well, they are rusty from disuse.  But we are working with key stakeholders in Brazil to sharpen them so they are more effective and more accessible as coffee companies are likely to reach for them for the first time.

With Repórter Brasil we are scoping a project that surfaces additional information that may be helpful for companies seeking more insight into labor dynamics in Brazil’s coffee sector.  And with InPacto, we are talking about a coffee-sector working group that would enlist Brazilian exporters and their downstream supply chain partners in a pre-competitive collaboration focused narrowly on coffee and designed to root out modern slavery from Brazil’s supply chains.

Perhaps it is not too late.  In fact, it may be that there has never been a better time for the coffee sector to reach into Brazil’s anti-slavery toolkit than right now.