Dive Brief:
- Hershey has been ordered to confront a lawsuit by investors seeking to force the company to turn over records about cocoa from African farms that may use illegal child labor.
- Delaware Chancery Court Judge Travis Laster overruled a master’s recommendation that the shareholders’ request to see cocoa-supply chain records be denied yesterday. He claimed that a Louisiana pension fund's questions about Hershey executives’ knowledge of how much the company’s cocoa, grown in West Africa, may have been produced by child slaves were valid.
- Laster said the suit’s allegations create “a reasonable inference about the possibility” some cocoa Hershey acquired may have been obtained by illegal child labor, and “warrant further investigation.”
Dive Insight:
As we saw here back in November 2012, The Louisiana Municipal Police Employees’ Retirement System, which holds Hershey shares, sued the candy company to gain access to the company’s records about cocoa purchases from West African suppliers who don’t comply with international child-labor restrictions. The fund contends that Hershey officials put the candy company’s reputation at risk by relying on supplies produced by cocoa farms in West African countries that flout child-labor laws.They do have a point, as being linked to child labor would certainly taint a company's reputation, despite all the publicity it may garner for environmental progress.