Hershey's Sweetens Stakeholder Engagement

Hershey's has had its share of critics in recent years. The company lagged on issues including responsible sourcing, and when it released its first corporate social responsibility (CSR) report in 2010, critics amplified their displeasure with the company. Accusations over child labor have plagued Hershey while other companies within its space appeared more proactive in tackling such issues. In fairness the company asked for feedback, and they received a lot of it, especially regarding responsible palm oil and cocoa sourcing.

Now, Hershey’s is getting with the program, and its most recent CSR report is a step in the right direction. The company listened to a variety of stakeholders and asked them about the most pressing problems facing the company. To that end, Hershey defined eight engagement priorities, which include ethical sourcing, sustainable agriculture, child labor, and consumer health.

So what is Hershey working on?

A responsible cocoa supply chain. A company sourcing from 10,000 different vendors is only one wayward supplier way from dealing with a massive public relations headache. But the pain that agricultural laborers endure to collect cocoa for internationals is far more intense. Hershey is therefore working to identify high risk suppliers and improve the overall ethical performance of its supply chain with the engagement of third-party monitoring organizations Sedex and AIM-Progress.

The company is also contributing $10 million towards an initiative to work with farmers on improving their standard of living, educational opportunities and long term sustainable development. Most of the world’s cocoa is grown on small family farms, and with the future of the world’s cocoa crop at a tipping point, it is only in Hershey’s and its competitors’ best interest to do more to improve the livelihood of the families who keep the chocolate companies in business. Other initiatives include the funding of a program to eliminate child labor as well as a mobile technology system to help farmers learn best practices, learn child labor laws and understand how they can more effectively market their cocoa crops.

Energy efficiency: Hershey has realized that managing resources effectively can only add to its bottom line. They company has upgraded properties to LEED-specific guidelines, installed solar power installations at its Pennsylvania amusement park, converted a boiler at a Hawaii facility to turn macadamia nut shells into energy and has installed wastewater treatment facilities to capture methane gas for use as a fuel source.

Waste reduction: All those snacks result in massive amounts of waste, and Hershey has set some goals for the next few years. Its operations in Mexico have redesigned packaging to use less plastic. And by 2016, the company is determined to eliminate 20 million pounds of packaging material from its products and use 80 percent recycled materials in all of its packaging.

Hershey still has a long road ahead towards proving to its stakeholders that it is taking responsible sourcing seriously. So far what it has announced in its CSR report are in reality more words than actions. But the company has listened to its critics, who currently, and even more a year from now, will hold the company accountable for the goals it has set. The company is on the right track, and it will be interesting to see what Hershey accomplishes a year from now.

Leon Kaye, based in California, is a sustainability consultant and the editor of GreenGoPost.com. He also contributes to Guardian Sustainable Business and Inhabitat. You can follow him on Twitter.

Photo courtesy Hershey.