4C Code of Conduct: marginal standards for corporate coffee

Note that this is now the Baseline Common Code of the Global Coffee Platform.

“Mainstream” commodity coffee makes up over 85% of the sold and consumed in the world. Most of it is bought and sold by the large corporate coffee roasters. It is this cheap, anonymous coffee that is usually responsible for environmental destruction and related woes.

The 4C Association, made up largely of mainstream producers and suppliers, put together the 4C Code of Conduct to address some of the most egregious, unsustainable practices in the industry.

While compliance with the 4C Code of Conduct does not constitute a certification, it’s a useful frame of reference. Here, we’ll see how the big corporate roasters address environmental sustainability and how much it contrasts with the standards of other certifications and even uncertified specialty coffee. Prepared to be appalled — this Code reveals how most of the world’s coffee is apparently produced.

Introduction to the 4C Association

The 4C Association was established in 2006 as an offshoot of the Common Code for the Coffee Community project. The 4C Association is a global, “open and inclusive” group of members in the coffee industry, including producers. Membership fees are nominal for small producers, but may be up to €160,000 for large industry members (such as Kraft, Nestlè, Aldi, and Tchibo, as well as importers, brokers, etc.). Membership fees help fund 4C Support Services, which provide training for producers.

The 4C goal is to ensure that all coffee complies with minimum sustainability standards, via their 4C Code of Conduct.

The 4C Code of Conduct

The 4C Association states: “The 4C Code of Conduct includes baseline requirements for the sustainable production, processing and trading of coffee and eliminates unacceptable practices. The code facilitates a dynamic improvement process by providing guidance for and commitment to continuous improvement.”

First, there are ten Unacceptable Practices. These are the mandatory prohibitions. 4C compliant members must not engage in the following:

1. The worst forms of child labor. [Using this definition, in Article 3.]
2. Bonded and forced labor.
3. Human trafficking.
4. Prohibiting membership or representation by unions.
5. Forced eviction without adequate compensation.
6. Failure to provide adequate housing for workers, where required.
7. Failure to provide potable water to all workers.
8. Cutting of primary forest or destruction of other forms of natural resources that are designated as protected areas by national and/or international legislation.
9. The use of pesticides banned under the Stockholm convention and listed in the Rotterdam Convention on Persistent Organic Pollutants (POPs).
10. Immoral transactions in business relations according to international covenants, national law and practices.

In other words, activities that are illegal. I presume that the compilation and mere existence of this list indicates that coffee is produced — perhaps commonly — under at least some of these atrocious conditions. While 4C roaster/final buyer members have to commit to buying increasing amounts of coffee from producers verified as complying with the Code of Conduct, they are not required to do so exclusively.

4C estimates that only about 30% of the global green coffee supply comes from 4C members that do not use these practices. Another 10% of the global supply is made up of specialty and various certified coffees.

That means at least 60% of the world’s coffee is produced under conditions that violating these basic human rights, environmental laws, and business ethics. Please think about that next time you are tempted to buy Folgers, Nescafè, or other cheap brand.

Beyond the 10 Unacceptable Practices, there are 27 social, environmental and economic principals. Each one has three criteria/indicators, categorized like traffic lights: red (to be discontinued), yellow (to be improved), and green (desirable practice).

Producers are considered in compliance with the code even if they score “red” in some principals, so long as there is an equal number of ”green” practices in the same dimension (social, environmental, or economic) equaling a ”yellow” average.

A look at the environmental principals

Of the 27 principals, 10 are listed under the environmental category. They are summarized below, using their “green” or highest criteria. While I have paraphrased and condensed here for space, I have not over-simplified the indicators — their generic generality is much as you see it below (you can download the entire Code on this page).

• Conservation of biodiversity is supported. Land use maps exist, and a protection program exists and meets at least national law.
• Use of pesticides is minimized.
• Soil conservation practices are in place, and there are no signs of erosion.
• Fertilizers are used appropriately via soil and plant analysis and documentation.
• Organic matter management is in place through the use of organic fertilizers and reuse of organic waste.
• Water resources are conserved via a water management plan which includes efficiency in irrigation and wet processing and conservation of water sources.
• Wastewater management for sewage and wet processing is in place.
• Safe waste management is in place (reuse, recycling and safe disposal).
• Preferential use of renewable energy (potential sources identified and used if possible).
• Saving energy by quantifying use, reduction of use, and improvement in efficient use.

Imagine the opposite of these “green” criteria and you’ll have the “red” criteria. The red criteria for#2, for example, is that “use of the most hazardous pesticides…is practiced.” Yellow criteria represent somewhere in between the two, of course.

Therefore, under the “yellow average” rule, a coffee could be 4C compliant even if there was evidence of hunting of endangered species, hazardous pesticides applied and stored without regard to safety, wastewater discharged directly into the environment, AND severe soil erosion, so long as there was appropriate use of fertilizers, including organic fertilizers; efficient use of water; and energy use is monitored, with fossil fuel use reduced and renewable sources used if possible.

Conclusions

I know we all have to start somewhere, and something is better than nothing. I can appreciate the effort it took to get all these big players on the same page — any page. But frankly, it’s unacceptable to me that any major corporation purchases coffee from producers that don’t meet basic standards of human and environmental decency.

Only 3.26% of the coffee purchased by the four largest buyers of green coffee in the world — Nestlè, Kraft, Sara Lee, and JM Smuckers — was reported to have met any sort of standards at all.*

I know that because of their large volumes, these roasters sometimes don’t even know where their coffee comes from. I believe that they should. I also think that the highest level of compliance (“green”) for every one of the 28 principals of the 4C Code of Conduct should be the starting point — the minimal standards required. These companies can afford to clean up their supply chains, and help their sources meet these standards. The combined profits of these four companies in 2009 was nearly $15 billion. Perhaps I’m oversimplifying and being naïve, but the worst thing that could happen would be that their profits would drop temporarily and the price of coffee to consumers would finally reflect the true cost to people and the environment.

I doubt this will happen any time soon. So the least we can do is take a look at those ten unacceptable practices and ask ourselves if that’s what we want to support. We need to look at that list and remember that we have no assurance that over 96% of the coffee bought and sold by Nestlè, Kraft, Sara Lee, and JM Smuckers (brand list here) wasn’t produced under some — maybe all — of these loathsome conditions.

Today is National Coffee Break Day, a coffee-awareness campaign sponsored by the National Coffee Association, an industry trade group. Tweet or link to this post on Facebook — let’s all spread some awareness about the nature of “corporate coffee.”

*In my previous post on how much sustainably-grown coffee is purchased by big buyers, I excluded the amounts that were listed as 4C compliant (and Fair Trade certified) because I didn’t feel it represented coffee produced under meaningful “eco-friendly” standards. The figure stated above, 3.26%, includes 4C and Fair Trade coffees, plus all the other certifications.

Posted in Corporate coffee