The Hershey Company

The undersigned entity strongly supports an EU wide due diligence regulation and urges legislators to come to a timely resolution.

"The Cocoa Coalition has consistently supported the proposed EU Directive on Corporate Sustainability Due Diligence. We believe that it represents an important step forward in driving the necessary transformation of the cocoa and chocolate sector and in making human rights and environmental due diligence the norm in global value chains. We called for EU-wide due diligence legislation in the first position paper we published, in 2019.Accordingly, we urge support for finalising the text of the Directive as soon as possible and before the end of the current EU legislative term. Failure to do so would undermine the position of those companies aiming to put in place systems that protect human and labour rights and the environment. It would risk the emergence of a patchwork of national legislation in EU member states, increasing compliance costs without any benefit to the sector or consumers. This would be a major setback to sustainability in global supply chains."

Following the agreement of text of the CSDDD in December 2023, the signed entities urge the EU for timely approval and implementation of the CSDDD.

"The Cocoa Coalition ... welcomes the conclusion of a political agreement on the EU Corporate Sustainability Due Diligence Directive (CSDDD) on 13 December 2023. We believe that it represents an important step forward in driving the necessary transformation of the cocoa and chocolate sector, and in making due diligence the norm in global value chains. We reiterate the critical importance of approving the CSDDD as soon as possible and before the end of the current EU legislative term. Failure to do so would significantly undermine the establishment of a level playing field across the European Union, lead to a fragmentation of national approaches and result in a major setback to sustainability in global supply chains."

The undersigned entity calls for no modifications of the CSDDD to be undertaken i relation to the Omnibus Package Proposal.

"In our view, the current CSDDD represents an important step forward in driving the necessary transformation of the cocoa and chocolate sector and in making human rights and environmental due diligence the norm in global value chains. Through the Cocoa Coalition, we have called for EU-wide due diligence legislation since our joint paper in 2019.""A failure to implement the CSDDD on time would undermine the position of those companies aiming to put in place systems that protect human and labour rights and the environment. It would risk the emergence of a patchwork of national legislation in EU member states, increasing compliance costs without any benefit to the sector or consumers. This would be a major setback to sustainability in global supply chains. In order to prevent more uncertainty and delays, we urge the European Commission to focus on the preparations as required in the CSDDD. We call upon the European Commission not to undertake any modification of the adopted text of the CSDDD, nor to reopen it for renegotiation by the co-legislators."

The undersigned entity supports an EU wide due diligence regulation.

"EU legislation and actions could make a real difference to cocoa farmers and their countries, if properly and fairly implemented and enforced.""Key priorities: Ensuring that the European Commission and EU member states do all they can to ensure the full implementation of the CSDDD."

The undersigned entity supports an EU wide due diligence regulation.

"A crucial element of an EU strategy to achieve this aim is the introduction of mandatory EU-wide due diligence legislation, including the cocoa sector – as we argued in our first joint position paper on the EU’s policy and regulatory approach to cocoa, in December 2019. This would help to create a framework for the sustainable and responsible consumption of cocoa (and other products) within the EU, the world’s largest consumer of cocoa and chocolate."

The undersigned entity welcomes the publication of the CSDDD and calls for strengthening of the regulation.

"The signatories to this position paper welcome the publication of the proposed EU Directive on Corporate Sustainability Due Diligence (COM(2022)71). We believe that the proposed Directive, alongside the proposed Regulation on Deforestation published in November 2021, represents an important step forward in driving the necessary transformation of the cocoa and chocolate sector, among many other areas of activity. We called for legislation for both these approaches to due diligence in the first position paper we published in 2019, and in our more detailed position paper published in October 2021.""We believe that the Directive could be further strengthened in a number of important respects ... partnerships agreements in the cocoa sector, ... due diligence process and business relationships, ... purchasing practices, ... material scope: human rights and environmental criteria, ... company size, ... engagement with stakeholders, ... due diligence process, ... access to justice, ... sectoral guidelines"

The undersigned entity supports requiring human rights due diligence of all companies regardless of sector or size, recognising the additional support needs of SME's. The undersigned entity calls for the inclusion of companies larger than micro-enterprises in all sectors to be covered by the Directive.

"We also welcome the many references to the need for support for SMEs affected by the Directive (which should encompass SMEs outside the EU as well as inside)""As we have argued in our previous paper: ‘As recognised in the UN Guiding Principles, the responsibility to respect human rights applies to all companies regardless of their size, sector, operational context, ownership or structure … the human rights and environmental due diligence legislation should apply to all companies registered or operating in the EU regardless of their legal form or size, including state-owned enterprises. We recognise that smaller companies may possess simpler supply chains. We do not believe, however, that these companies should be exempted from the due diligence obligation. In a very fragmented end market, the inclusion of smaller players is critical to establish a level playing field and to ensure that all companies do their part and work closer together to improve the sustainability of the cocoa sector.’""Accordingly, we believe that all companies larger than micro-enterprises (defined as companies which employ fewer than 10 persons and whose annual turnover and/or annual balance sheet total does not exceed €2 million) in all sectors should be covered by the requirements of the Directive. (This is consistent with the position we have adopted with regard to the Deforestation Regulation.) We recognise that SMEs are likely to need additional support in introducing due diligence frameworks, but there are already several relevant provisions in the existing text. In addition, we suggest an extended implementation period for SMEs from the entry into force of the Directive."

The undersigned entity supports enforcement mechanisms.

"Enforcement of a company’s implementation of its due diligence obligations should take into account the extent of the company’s involvement and leverage over its suppliers"

The undersigned entity welcomes provisions to enable remedy for human rights impacts.

"As we argued in our 2021 due diligence paper, the Directive should require member states to fulfil the provisions of the UN Guiding Principles whereby states must take appropriate steps to ensure those affected by abuses have access to effective remedy through judicial, administrative, legislative and other appropriate means, including provisions for civil liability.""We welcome ... provisions to enable access to effective remedy, including civil liability""If a company has caused or may cause an adverse impact, it should cease, prevent or mitigate the impact and remediate any harm if the impact has occurred.""... It should also contribute to remediating the harm if the impact has occurred, to the extent of its contribution."

The undersigned entity supports exerting leverage to provide support with other parties.

"the Directive should be consistent with the UN Guiding Principles, which encourage companies to take a risk-based approach and prioritise their efforts on the basis of: (1) the severity of the actual or potential harm to people and the environment; and (2) the extent of companies’ leverage over their suppliers.""Accordingly, and in line with the UN Guiding Principles, companies should be expected to take appropriate action to identify, prevent, mitigate and account for their adverse human rights and environmental impacts depending on their involvement and the extent of their leverage on their suppliers: ... • If a company has contributed or may contribute to an adverse impact, it should cease, prevent or mitigate its own contribution to the impact, and use or increase its leverage with other parties to prevent or mitigate it.""If a company has not caused or contributed to an adverse impact, but its operations, products or services may be linked to an impact through a business relationship, it should use or increase its leverage with other parties, including suppliers, to seek to prevent or mitigate the impact."

The undersigned entity supports judicial enforcement particularly civil liability.

"As we argued in our 2021 due diligence paper, the Directive should require member states to fulfil the provisions of the UN Guiding Principles whereby states must take appropriate steps to ensure those affected by abuses have access to effective remedy through judicial, administrative, legislative and other appropriate means, including provisions for civil liability.""The extent of civil liability should take into account the extent of a company’s involvement""we welcome... provisions to enable access to effective remedy, including civil liability"

The undersigned entity supports a due diligence process covering the entire supply chain and calls for a rewording of established business relationships to include the entire supply chain.

"Both the UN Guiding Principles and the OECD Due Diligence Guidance stress the need for due diligence to be risk-based, for companies to identify, prevent, mitigate and account for how they address their adverse human rights impacts in their operations and supply chains, prioritising the most salient issues. However, this emphasis on risk is largely absent from the proposed Directive, which focuses instead on business contractual relationships.""On top of this, the Directive restricts the due diligence obligations to entities with whom a company has an ‘established business relationship’ (alongside the company’s own operations and subsidiaries) – a term which is difficult to define precisely and does not feature in the UN Guiding Principles or OECD Due Diligence Guidance. This unduly restricts the reach and impact of the due diligence process. In practice, it is entities in more remote parts of the value chain and with whom companies have less well-established business relationships that are often most likely to be associated with adverse human rights and environmental impacts.""We therefore believe that the restriction to ‘established business relationships’ should either be removed or reworded to make it clear that companies are obliged to conduct due diligence across their entire supply chain. Instead, the Directive should be consistent with the UN Guiding Principles, which encourage companies to take a risk-based approach and prioritise their efforts on the basis of: (1) the severity of the actual or potential harm to people and the environment; and (2) the extent of companies’ leverage over their suppliers.""Accordingly, and in line with the UN Guiding Principles, companies should be expected to take appropriate action to identify, prevent, mitigate and account for their adverse human rights and environmental impacts depending on their involvement and the extent of their leverage on their suppliers: ...""If a company has contributed or may contribute to an adverse impact, it should cease, prevent or mitigate its own contribution to the impact, and use or increase its leverage with other parties to prevent or mitigate it."

The undersigned entity is supportive of additional action generally.

"The legislation needs to encourage the establishment of closer and more long-term relationships between companies and their suppliers, including the provision of investment and capacity-building"

The undersigned entity is supportive of stakeholder engagement throughout the due diligence process and calls for clearer recognition of its importance.

"The due diligence process described in the proposed Directive includes a number of references to engagement with stakeholders, but these are limited to consultations with potentially affected groups in gathering information on actual or potential adverse impacts (Article 6(4)), and in developing prevention action plans and corrective action plans (Articles 7(2)(a) and 8(3)(b)); and these consultations are only to take place ‘where relevant’, in the opinion of the company.""We believe that the Directive should more clearly recognise the need for meaningful and continuous engagement with affected stakeholders or their legitimate representatives: an ongoing process of interaction and dialogue between a company and its actually or potentially affected stakeholders that enables the company to hear, understand and respond to their interests and concerns, including through collaborative or joint approaches between a company and its suppliers to ensure a coordinated and coherent dialogue. A stronger requirement for meaningful and continuous engagement should be written into the Directive as part of each stage of the due diligence process. Special efforts should be made to engage with particularly vulnerable groups, including smallholders and indigenous peoples and local communities, and engagement strategies should be gender-sensitive."

The undersigned entity is supportive of stakeholder engagement throughout the due diligence process and calls for clearer recognition of its importance.

"The due diligence process described in the proposed Directive includes a number of references to engagement with stakeholders, but these are limited to consultations with potentially affected groups in gathering information on actual or potential adverse impacts (Article 6(4)), and in developing prevention action plans and corrective action plans (Articles 7(2)(a) and 8(3)(b)); and these consultations are only to take place ‘where relevant’, in the opinion of the company.""We believe that the Directive should more clearly recognise the need for meaningful and continuous engagement with affected stakeholders or their legitimate representatives: an ongoing process of interaction and dialogue between a company and its actually or potentially affected stakeholders that enables the company to hear, understand and respond to their interests and concerns, including through collaborative or joint approaches between a company and its suppliers to ensure a coordinated and coherent dialogue. A stronger requirement for meaningful and continuous engagement should be written into the Directive as part of each stage of the due diligence process. Special efforts should be made to engage with particularly vulnerable groups, including smallholders and indigenous peoples and local communities, and engagement strategies should be gender-sensitive."