{"id":21995,"date":"2017-11-13T21:14:33","date_gmt":"2017-11-14T02:14:33","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/melting-chocolate-climate-change-and-the-cacao-bean-supply-chain-for-lindt-sprungli\/"},"modified":"2017-12-05T21:00:53","modified_gmt":"2017-12-06T02:00:53","slug":"melting-chocolate-climate-change-and-the-cacao-bean-supply-chain-for-lindt-sprungli","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/melting-chocolate-climate-change-and-the-cacao-bean-supply-chain-for-lindt-sprungli\/","title":{"rendered":"Melting Chocolate \u2013 Climate Change and the Cacao Bean Supply Chain for Lindt & Spr\u00fcngli"},"content":{"rendered":"

Lindt & Spr\u00fcngli (Lindt) is a Swiss chocolate company with an exceptional reliance on the cacao bean as a raw material input for their chocolate products. Nearly every product in their annual sales of 365 billion CHF[1]<\/a> is composed of a minimum of 30% cacao[2]<\/a>. Cacao cultivation will be negatively affected by climate change because it can only be grown in a narrow temperature and humidity band around the equator, and that the amount of land suitable for cacao cultivation will decrease significantly with rising global temperatures. For example, in Ghana where Lindt sources 100% of their Africa-based cacao[3]<\/a>, agricultural surveys found that of 294 locations assessed, 10.5% showed increasing suitability for cacao production and the remaining 89.5% would become less suitable by 2050[4]<\/a>. Importantly, not only will the total area of cultivation decrease, the quality of existing land will also decrease. The figure below highlights this risk.<\/p>\n

\"\"
\n<\/a>
\nRecognizing the importance of this threat, Lindt is taking action to strengthen their supply chain and sourcing strategies. To-date, their primary initiative has focused on a holistic approach referred to as the \u201cCocoa Commitment Campaign[6]<\/a>\u201d. Three key aspects of the program involve working closely with small-holder cacao famers to promote specialist skills and training, providing farmers direct capital resource support, and ongoing evaluation\/auditing processes of the overall program. The specialist training focuses on good farming practices, biodiversity, harvesting, labor rights, and more. Capital support is delivered by providing farm equipment, and construction of schools and drinking water wells. Finally, Lindt has implemented a partnership with an NGO called The Forest Trust to evaluate progress made by farmers and the overall effectiveness of the program, with proposed interventions and iterations made as required.
\nMaps highlighting the decline in suitable land for growing cacao in 2050[5]<\/a><\/p>\n

Due to the success of the program so far, Lindt is planning to roll out the program beyond just Ghana over the next 3-5 years. They hope to fully cover their cacao supply across Ecuador, Papua New Guinea and others by 2020.[7]<\/a><\/p>\n

While Lindt\u2019s progress so far has been notable, I believe the severity of the risk requires additional action to further protect their supply chain. For example, ironically, it is the cocoa trade that is partly responsible for helping fuel deforestation and climate change by extension.[8]<\/a> Lindt should publicly take a stand against farmers and organizations that clear rainforest land in order to plant cacao farms. As Lindt already maintains a tight tracking and quality control process for their source farms, clamping down on these farmers and farming techniques would be unlikely to affect their cacao supply. In fact, it would be a great opportunity to highlight their strong sustainability and other community engagement initiatives. In the medium to long term I believe that Lindt could also begin diversifying their cacao source countries and more importantly, exploring cacao substitutes like the carob bean[9]<\/a>. Another longer term strategy could be to explore GMO-cacao to be more resistant to the rising temperature and humidity changes. Mars Chocolates is already pursuing this approach through a couple different channels.[10]<\/a><\/p>\n

Finally, a few open questions came to mind while researching this topic. I felt that there are many parallels to coffee farming and the coffee trade, and it would be interesting to see how companies like Starbucks are planning to address similar challenges. Secondly, since I don\u2019t believe that Lindt can protect cacao fully by themselves, I wonder about how an industry-consortium could work between other multinational firms.
\n(738 words)<\/p>\n

 <\/p>\n

[1]<\/a> Lindt, \u201cKey Figures\u201d, Lindt Corporate Site, [http:\/\/www.lindt-spruengli.com\/investors\/financial-information\/key-figures\/], accessed November 2017.<\/p>\n

[2]<\/a> Lindt, \u201cFAQ\u201d, Lindt Corporate Site, [https:\/\/www.lindtusa.com\/faq], Accessed November 2017<\/p>\n

[3]<\/a> Lindt, \u201cThe Lindt Sprungli Farming Program\u201d, Lindt Corporate Site, [http:\/\/www.chocolate.lindt.com\/world-of-lindt\/sustainability\/the-lindt-spruengli-farming-program\/], accessed November 2017.<\/p>\n

[4]<\/a> P. L\u00e4derach, \u201cPredicting the future climatic suitability for cocoa farming of the world\u2019s leading producer countries, Ghana and C\u00f4te d\u2019Ivoire\u201d Springer Link, [https:\/\/link.springer.com\/article\/10.1007%2Fs10584-013-0774-8], accessed November 2017<\/p>\n

[5]<\/a> P. L\u00e4derach, \u201cPredicting the future climatic suitability for cocoa farming of the world\u2019s leading producer countries, Ghana and C\u00f4te d\u2019Ivoire\u201d SpringerLink , [https:\/\/link.springer.com\/article\/10.1007%2Fs10584-013-0774-8], accessed November 2017<\/p>\n

[6]<\/a> Lindt, \u201cLindt & Sprungli Achieves 2016 Cocoa Commitment\u201d, Lindt Corporate Site, [https:\/\/tinyurl.com\/y9lu6vzk], accessed November 2017<\/p>\n

[7]<\/a> Lindt, \u201cResponsible Procurement\u201d, Lindt Corporate Site, [http:\/\/www.lindt.ca\/en\/world-of-lindt\/sustainability\/responsible-procurement\/], accessed November 2017<\/p>\n

[8]<\/a> Anna Pujol-Mazani, \u201cIs Your Chocolate bar Fueling Deforestation in West Africa?\u201d, Reuters, [https:\/\/www.reuters.com\/article\/us-westafrica-chocolate-deforestation\/is-your-chocolate-bar-fuelling-deforestation-in-west-africa-idUSKCN1BP1J4], accessed November 2017<\/p>\n

[9]<\/a> Battle I, Tous J (1997).\u00a0Carob tree<\/a>\u00a0(PDF). Rome, Italy: International Plant Genetic Resources Institute.\u00a0ISBN<\/a>\u00a0978-92-9043-328-6<\/a>. .ccessed November 2017<\/p>\n

[10]<\/a> Rebecca Rupp, \u201cCan GMOs Save Chocolate?\u201d, National Geographic, [http:\/\/theplate.nationalgeographic.com\/2015\/03\/18\/can-gmos-save-chocolate\/], accessed November 2017<\/p>\n","protected":false},"excerpt":{"rendered":"

Exploring how a global chocolate manafacturer, Lindt, will adapt to climate change threatening its cacao bean supply<\/p>\n","protected":false},"author":9587,"featured_media":21998,"comment_status":"open","ping_status":"closed","template":"","categories":[1218],"class_list":["post-21995","hck-submission","type-hck-submission","status-publish","has-post-thumbnail","hentry","category-climate-change","hck-taxonomy-organization-lindt","hck-taxonomy-industry-food-and-beverage","hck-taxonomy-country-switzerland"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-rctom\/assignment\/rc-tom-challenge-2017\/","yoast_head":"\nMelting Chocolate \u2013 Climate Change and the Cacao Bean Supply Chain for Lindt & Spr\u00fcngli - Technology and Operations Management<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/melting-chocolate-climate-change-and-the-cacao-bean-supply-chain-for-lindt-sprungli\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Melting Chocolate \u2013 Climate Change and the Cacao Bean Supply Chain for Lindt & Spr\u00fcngli - 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