Ethical and sustainable coffee production is the main advantage of both micro-roasters and international corporations. That’s why brands like Starbucks and Nestle – two of the largest coffee companies in the world – have created certifications that confirm responsible production, both in terms of the land where they are grown and the people who work on them and their coffee is treated.
But scathing new report maintains that these two companies in particular are failing to meet their own standards and that at their coffee plantations in China “an environment characterized by excessive working hours without overtime pay, child labor, lack of medical and health insurance, lack of protective equipment, low wages, lack of paid leave and the exploitation of indigenous peoples.”
Created in collaboration between Coffee Watch and China Labor Guardthe report is based on undercover investigations conducted at coffee plantations across Yunnan province that supply coffee to Starbucks and Nestle. Over the course of 2024, investigators traveled to the area three times and interviewed “66 people, including coffee farmers, their families and teachers from schools attended by children from coffee-growing families” to “better understand the problem of child labor.” – we read in the report. states.
They identified cases of child labor and adults having to work excessive hours – “approximately 12 hours a day, 7 days a week for 3 consecutive months” – without paid leave, compensation for public holidays, sickness or personal leave, and without any insurance medical or protective equipment despite “grueling conditions, exposure to harsh conditions, agrochemicals and occupational health risks.”
These violations not only violate Starbucks and Nestle’s CAFE Practices and 4C minimum ethical certification standards, respectively, but also violate China’s labor laws.
However, these coffees are still CAFE Practices certified and 4C certified thanks to a loophole called “ghost farms.” According to the report, international brands such as Starbucks and Nestle buy coffee from immense farms that have been certified and “comply with production and labor standards.” However, these farms source their coffee from smaller, unregulated “ghost farms” that are not held to the same standards, allowing unethically produced coffee “to be ‘laundered’ into the global market under the guise that it is ethically sourced,” the report claims.
Coffee Watch and China Labor Watch report no allegations that Starbucks or Nestle were party to, or even aware of, the labor violations they detected. Both companies submitted statements to Washington Post Office about the report, and Starbucks’ director of international communications said it was “committed to thoroughly investigating” the allegations and that the company’s contracts with suppliers “require all farms to maintain detailed records regarding coffee production and purchases,” meaning that the company was at least aware that coffee was purchased that did not come from the estate. Nestle senior corporate spokeswoman Claudia Alfonso said they “take these allegations very seriously and have contacted our suppliers to thoroughly investigate the matter and, if necessary, take corrective action.”
Still, the report states that this “repeated pattern of neglect and abuse of coffee certified by 4C and CAFE Practices (operated by Conversation International for Starbucks) calls into question whether these certifications can truly serve as industry benchmarks, and they can even be considered ethical standards at all.
Read it full ghost farming and coffee laundering report here.
