Introduction to Cocoa Life

1. Introduction to Cocoa Life Building a sustainable cocoa supply chain ICCO - International workshop on cocoa certification June 2013 David PREECE

2. Overview Challenges of the global cocoa supply chain Certification and cocoa sustainability Our experience Cocoa Life Working together

3. Challenges of the global cocoa supply chain

4. Cocoa thrives in narrow geographic area Key cocoa origins % of global supply WEST AFRICA 70% Cote d”Ivoire 35% Ghana 25% Nigeria 5% Cameroon 5% ASIA 20% Indonesia 10% Malaysia <5% Vietnam <5% India <1% LATIN AMERICA 10% Brazil 5% Ecuador <5% Peru <5% Dom Rep <5%

5. Issues facing cocoa communities Farming Low yields due to aging trees, poor farming practices and lack of access to inputs. Community Many cocoa communities lack basic infrastructure making them unattractive places to live. Limited access to education and health services. Challenges around gender equality and women’s empowerment. Livelihoods The limited cocoa season and poor returns means that poverty and food insecurity are real challenges for the many small-holders which make up cocoa farming communities. Youth Cocoa is struggling to attract young people from farming communities resulting in an aging and declining workforce. Child labour continues to be a problem in cocoa communities. Environment Cocoa farming is conducted in a very narrow geographic area, vulnerable to the challenge of climate change.

6. Demand predicted to outstrip supply Without intervention a 1MM tonnes deficit is forecast by 2020 Source: LMC

7. Certification and cocoa sustainability

8. Certification background Certification is one of the tools the market has used to improve the sustainability of cocoa supply Wide variety of different certification schemes – main ones: Fairtrade, Rainforest Alliance, UTZ Varying approaches but similar objectives: to improve farmer livelihoods, minimize environmental impact, improve social conditions Focus on farming practices. Fairtrade focus on trading relations The amount of certified cocoa is growing rapidly. Currently 6% of the market (Source: KPMG ICCO report)

9. Sustainability and certification MDLZ is one of the largest buyer of Fairtrade cocoa and of Rainforest Alliance cocoa in the world Source: Cocoa Certification (2012) KPMG commissioned by the ICCO

10. Our experience of cocoa sustainability

13. Cocoa Life approach Generate empowered, thriving cocoa communities to increase sustainable cocoa supply Three principles Holistic farmer-centered Sourcing alignment Partnership Measuring, evaluating and reporting on 5 key areas defining thriving communities Independently verified

14. Outcomes define thriving communities Farming We believe cocoa farmers deserve to earn an income that lifts them out of poverty so we help farmers improve their yields and livelihoods Community We believe in empowering cocoa farming families to create the kind of communities they and their children want to live in. We believe gender equality benefits everyone and work to improve women’s empowerment. Livelihoods We believe providing business knowledge and skills will create farming entrepreneurs and support farmers to increase incomes from other sources. Youth We are working towards eliminating child labor by helping communities tackle its root causes. We believe cocoa farming should be an attractive business for the next generation, so we work to inspire young people about a future in cocoa farming. Environment We believe in protecting the landscapes in which cocoa is grown to maintain eco-systems and provide viable environments and farming land for future generations

15. Working together

16. All stakeholders in thecocoavaluechain must design solutionstogether For Mondēlez International, sustainability is a business necessity. Mondēlez International is a major buyer of certified products. „Cocoa Life“ will invest $400 Million by 2022 in West Africa, India, Indonesia, Dom. Republic and Brasil. Key principles: holistic farmer-centric, partnership, supply chain alignment.

17. Merci Thank You!