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A Chat with Nestle's COO About Cocoa and Child Labour

We had a sit town with Jose Lopez to have a pretty combative conversation.

by Joe Sandler Clarke
08 October 2015, 5:00am

Jose Lopez (Photo: Nestle)

When I meet Nestle's recently retired chief operating officer, Jose Lopez, in the basement of a central London hotel, our conversation begins combatively and goes on from there.

"Someone who reads your news doesn't understand the situation," he says, when I ask about child labour being used on the Ivory Coast cocoa farms that supply the company. "You clearly over-simply everything."

After taking up the job in 2009, Lopez managed to transform Nestle from an organisation censured for human rights violations and international controversies to one with an enviable reputation for sustainability and social responsibility. In 2013, KPMG ranked the company as one of the ten best businesses in the world for corporate social responsibility.

But problems persist. Despite opening up its supply chain to investigators from the Fair Labor Association (FLA) three years ago, last autumn some 56 under-18s were found working at Nestle suppliers in Ivory Coast, 27 of them being under-15.

Then there are the allegations contained in a recent Wall Street Journal investigation alleging abuse of migrant workers at the Malaysian palm oil plantations that supply the company.

There are also two lawsuits being brought against Nestle in the US. The first, filed this year, alleges that the fish in the company's Purina pet food is sourced from ships in Thailand that use slave labour. The second, started back in 2001, and still being fought, alleges that children were trafficked into Ivory Coast to work as slaves on cocoa farms used by the company.

Nestle insists "forced labour has no place in its supply chains", but the company has an unfortunate habit of attracting negative headlines.

So where does this leave Lopez, a man who uses phrases like "sustainability" and "shared value" like punctuation? Is all his talk about improving Nestle's image hot air?

"Tell me, have you been to Africa?" he asks, turning my child labour question on its head.

I tell him I haven't.

"Well there you go," he smiles. Dressed in a pinstripe suit, with designer glasses and slicked-back thinning white hair, he pauses. "You haven't been there and you don't know the situation."

On the lawsuit from 2001, which lawyers allege has been held up for years by delaying tactics from Nestle and the other defendants, he is similarly dismissive.

"When was that? 2001? Like the world has not changed since then," he says.

But what about the hold-ups? Or the manner in which Peter Brabeck-Letmathe, the company's chief executive, dealt with the allegations in the early-2000s by suggesting the situation would be worse if Nestle bought nothing?

"I was not the chief operating officer then," explains Lopez. "At that time my preoccupations did not let me think about this. But when I entered my job I was determined to do something."

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Then he turns his fire back on me.

"I have worked with the World Cocoa Foundation, with the FLA, with countless NGOs and journalists, and you come here and talk about 2001?" he says, raising his arms in mock exasperation. "Well fine, fine."

Throughout our discussion, you never get the sense that Lopez is genuinely annoyed. This is a game. The journalist from a liberal publication, versus the corporate big-shot. He frequently takes on the role of educator, telling me about Africa, Nestle's business model and, his favourite word, "sustainability". All the while, he is trying to be in control of the conversation.

He tells me Nestle invested $110 million (£72 million) back in 2009 to establish the Cocoa Plan, a project designed to improve the lives of cocoa farmers in West Africa and decrease the incidence of child labour. He talks up his company for inviting in FLA inspectors to map out Nestle's supply chain and report annually on incidents of child labour.

"Let me be very clear," he says at one point. "I believe, and this is maybe a philosophical point, but economic activity does not need to harm communities. We can create real value for society."

Moments later, he tells me to switch off my dictaphone. I do and he launches into a speech about his upbringing in southern Spain and the hardships his father endured as a jobbing factory worker who moved to Switzerland with the rest of the family when Lopez was young. There's no need for this to be off-the-record, except to illustrate the dynamic of our conversation.

Lopez has an impressive story to tell. From working-class stock, he studied mechanical engineering in Geneva before joining Nestle in 1979 as a project engineer. The fact that his family moved around a lot while he was young set him up for a career that has seen him hold senior positions at the company in Japan, Malaysia and Australia. Today, he works between 70 to 80 hours a week, with some of that time taken up by the international flights he makes to visit the company's vast empire. Along with the 200,000 people directly underneath him, he estimates that his work touches 25 million people worldwide, 10 percent of which are directly affected.

Nestle is massive, and perhaps that is part of the problem. How can you keep track of working conditions in some of the poorest parts of the world when your work directly affects the equivalent of half of Wales? "I cannot buy all my cocoa one bag at a time. You have to let it be harvested, be sent to the port and shipped off to Europe, America and elsewhere," says Lopez, when discussing the cocoa farms.

One of the big problems found by the FLA inspectors at the cocoa farms in Ivory Coast was a lack of awareness about Nestle's code of conduct and the fact many child workers do not have birth certificates, which, combined with a lack of age verification systems at plantations, means child labourers can slip through the net.

"If the kids don't have birth certificates, it's even more difficult. That needs to be the first thing. Paying more doesn't create birth certificates," he says. "There's only so much we can do in Ivory Coast, a country of 23 million. But because of our efforts we have the international cocoa initiative doing monitoring and remediation."

When I bring up the idea of simply paying workers more money, or not buying from suppliers who use child labour, he responds: "What would happen to them if we stopped buying from them? What would their life be like? They would fall into the hands of the black market. Of people who gave them money with no idea of what a fair price is."

Lopez retires from his role at Nestle the end of the month and will take up a host of roles, including a position at the Cambridge Institute for Sustainability Leadership, part of Cambridge University, as well as spending more time with his children and Francisca, his wife of 36 years. "I don't like to talk about legacy," he says, when I ask him how he would like to be remembered. "But I did my best."

@JSandlerClarke

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