4C Statement on “Exploitation and Opacity: The Hidden Reality of the Mexican Coffee in Nestlé and Starbucks Supply Chains” published by Empower LLC

Empower LLC, in cooperation with Coffee Watch and ProDESC, published a report last Friday, 14^th of February 2025, highlighting concerns in Mexican coffee supply chains. The report raises issues regarding socio-economic conditions of smallholders, corporate influence on sustainability standards, and deforestation and environmental impact.

The report referenced the role of the 4C Certification in Mexican coffee supply chains. 4C takes the concerns raised seriously and provides clarification on key points. We have grouped the several issues that have been raised and refer to these in the following thematic chapters:

Independence of 4C

In various parts of the report, 4C is described as “Nestlé’s proprietary standard” or “Nestlé’s certification scheme”. This is not the case.

4C is a voluntary, independent third-party certification system that sets and maintains rigorous sustainability standards while operating impartially to monitor compliance. 4C does not belong to or implement its standards within individual company supply chains; rather, compliance is assessed by independent, accredited certification bodies through thorough, regular audits and on-site verifications. These processes are further reinforced by oversight from 4C system users, ensuring impartiality, credibility, and global applicability in line with internationally recognized third-party certification principles.

Both the German Federal Government and the German Coffee Association (Deutscher Kaffeeverband e.V.) were involved in the founding of the 4C certification system. This was part of a broader commitment to promoting sustainability and responsible sourcing in global agricultural supply chains.

The initiative was a public-private partnership, bringing together government agencies, industry representatives, and civil society organizations to establish a common standard for sustainable coffee production and trade. Today, 4C is an independent organisation with a broad multistakeholder approach, and is designed to function independently in its auditing and verification role in coffee supply chains.

Empowering Smallholder Farmers

The report claims that 4C certification marginalizes small-scale farmers.

4C is designed to be inclusive, with over 93% of certified producers being smallholders.

To ensure accessibility and sustainability for smallholders, 4C applies a group-based certification approach, allowing farmers to join a 4C Unit – a structured collective that provides key benefits:

(i) Capacity Building & Technical Assistance – Smallholders receive targeted training and technical support from the Managing Entity (ME), helping them adopt sustainable farming practices and enhance productivity.

(ii) Reduced Certification Costs – By certifying as a group, smallholders avoid the financial burden of individual certification audits, making certification more affordable and accessible.

(iii) Market Access & Business Scaling – Smallholder farmers can pool their coffee production, creating a larger and more competitive supply that strengthens their bargaining power and facilitates access to international and sustainable coffee markets, in addition to local markets.

This group certification model ensures that smallholders are not excluded but empowered with better economic opportunities and improved sustainability practices.

Beyond certification, 4C actively supports smallholder farmers through internal management systems, continuous training, capacity-building programs, and tailored sustainability projects aimed at improving livelihoods.

4C actively engages in projects to enhance farmer livelihoods, such as the develoPPP initiative in Colombia, which supports smallholders in adopting sustainable agricultural practices and securing long-term economic stability.

As part of our dedication to sustainability and farmer well-being, 4C is the first coffee certification system to integrate the Food Security Standard (FSS) as an add-on. This initiative, developed in collaboration with WWF, Welthungerhilfe, and the Center for Development Research (ZEF), and supported by the German Federal Ministry of Food and Agriculture, aims to strengthen food security and human rights on a global scale.

The 4C system is specifically designed to meet the needs of smallholder farmers. No individual farmer is required to pay fees for certification or audits. Instead, these costs are usually covered by the Managing Entity (ME) – typically a coffee cooperative or a regional organization that represents a group of farmers. However, practically, any company related to the value chain (e.g. exporters, traders, and rosters) can take on the role of an ME.

This “group certification” model centralizes and redistributes costs, ensuring that smallholders are not financially burdened while maintaining robust compliance standards. The ME covers certification, training, and audit expenses on behalf of the farmers, making certification more accessible without direct financial obligation for individual producers.

By alleviating cost barriers and providing targeted support, 4C creates an enabling environment where smallholder farmers can thrive in sustainable coffee production while gaining better market access and long-term economic stability.

The Reach and Impact of the 4C System

The report claims that 4C is a “light” standard which is misleading.

The 4C standard is reinforced by its recognition at the SAI Silver and Gold level, ISEAL membership, and active participation in global sustainability initiatives, such as the UN Global Compact. Furthermore, 4C is independently benchmarked within the International Trade Centre’s Standards Map, further demonstrating its alignment with internationally recognized best practices.

The accusation that 4C favours major buyers is inaccurate. The 4C Code of Conduct requires the Managing Entity to safeguard the economic and social well-being of the BP Producers they source from. It does not favour large corporations; on the contrary, it is designed to support smallholders by incorporating special requirements that reflect their unique challenges and resources.

Enhancing Transparency and Traceability

The report claims that traceability in supply chains is fragile and depends on Internal Management Systems.

Traceability in 4C means that 4C certified coffee can be tracked and traced every step of the supply chain, from the producers to Final Buyers.

Within 4C Units, full traceability must be ensured and verified during 4C audits.

Outside 4C Units, traceability is ensured through mandatory reporting of all transactions via the 4C Portal. Additionally, 4C has introduced the Chain of Custody Certification. These mechanisms enable tracking certified coffee from farms through the supply chain, aligning with globally recognized traceability frameworks such as ISO 22095 and EU deforestation-free supply chain regulations. The 4C standard’s traceability system exceeds many industry standards by requiring strict documentation and verification at each stage.

Clarifying Supply Chain Responsibilities

We acknowledge the concerns raised regarding supply chain due diligence and the German Supply Chain Due Diligence Act (Lieferkettensorgfaltspflichtengesetz – LkSG).

However, it is important to recognize that the German authority (BAFA) overlooking the LkSG implementation does not benchmark, monitor and recognize certification systems. The responsibility for ensuring compliance with due diligence requirements under the LkSG lies with the companies operating these supply chains, not with 4C as a certification system.

4C does not own, manage, or control any coffee supply chains; rather, it provides an independent certification system. The role of 4C is to establish sustainability principles and verify compliance with them through independent third-party audits.

We remain committed to transparency, continuous improvement, and ensuring that 4C certification upholds robust social, environmental, and economic sustainability standards.

The Role and Governance of the 4C Advisory Board

The 4C Advisory Board serves as a multi-stakeholder body that provides strategic guidance to ensure the continuous improvement of the 4C certification system. It includes representatives from various sectors, including coffee producers, trade, industry, civil society, and independent experts, ensuring a balanced and independent approach to sustainability. The 4C Advisory Board members can transparently be viewed on our website: https://www.4c-services.org/stakeholders/4c-advisory-board/.

While companies like Nestlé participate, no single entity has undue influence over 4C system, which are developed through broad stakeholder consultation and aligned with internationally recognized sustainability frameworks. The Advisory Board operates under specific by-laws and principles that uphold data privacy and security while ensuring that decisions are not influenced or dictated by any single representative.

Ensuring Fair Compensation for Farmers

Setting a fixed minimum price is not a viable solution due to the diverse economic realities in different coffee-producing regions and market dynamics. Instead of intervening in market mechanisms, the 4C system focuses on strengthening the economic resilience of farmers through sustainability standards that promote better agricultural practices, long-term productivity, and access to premium markets. This approach empowers farmers to navigate market fluctuations more effectively. While 4C does not set a fixed price, buyers of 4C-certified coffee typically pay a premium, reflecting the added value of sustainable production.

Commitment to Zero Deforestation and Environmental Protection

The 4C standard strictly prohibits deforestation and mandates the protection of primary forests, high conservation value areas, and water resources to ensure that coffee production does not contribute to environmental degradation. 4C-certified producers must adhere to rigorous sustainability criteria that go beyond legal requirements, including measures to prevent land conversion and promote biodiversity-friendly farming practices.

Furthermore, 4C provides solutions for EUDR (EU Regulation on Deforestation-free products) compliance, supporting certified producers and supply chain actors.

It is a 4C requirement to conduct risk assessments prior to audits. Comprehensive risk assessments are based on advanced remote sensing data analyses, use of biodiversity databases, and social and ecological data. 4C uses deforestation maps which are i.a. based on the tree cover loss dataset by Hansen et al. Agricultural replanting activities may be identified as “loss” by the dataset. Therefore, 4C uses in addition to deforestation maps forest maps to differentiate between deforestation and replanting.

The 4C system upholds strict sustainability criteria that prohibit hazardous pesticides listed under international agreements such as the Stockholm and Rotterdam Conventions. Certified units must comply with the 4C Pesticide List as well as national pesticide regulations and must implement measures to minimize environmental impact.

Transparency, Credibility, and Alignment with the EU Green Claims Directive

As an independent, third-party certification standard, the 4C system complies with the requirements of the Green Claims Directive. The 4C logo and related claims rely on verifiable data that can be cross-checked via the respective audit report documents and overall audit result. 4C applies very strict rules on the usage of the 4C logo, which can be verified in chapter ten of the 4C System Regulations.

The 4C standard was created and is continuously being revised on the basis of public consultation. Public consultation is open to all, including NGOs, producers or other interested actors. Additionally, 4C operates a complaint mechanism that is available and open to all through which appeals of any actor can be shared: https://www.4c-services.org/process/procedure-of-complaints-and-appeals/. 4C highly appreciates any feedback received through those channels and encourages all stakeholder to actively share their feedback.

Strengthening Trust: The 4C Integrity Program

4C continuously evaluates the effectiveness of its system via the Integrity Program and the respective integrity audits. 4C sets out very robust rules in its Code of Conduct in regard to the compliance with regional and local laws. Cases brought to 4C’s attention are investigated thoroughly.

4C operates its own integrity program, which double-checks the work of the auditors (“watch the watchman”) and also manages a grievance and complaint channel, open to all stakeholders. Findings from the integrity program and our grievance and complaint channels contribute to the continuous improvement of the 4C system.

4C remains fully committed to assessing reported risks and addressing them through targeted interventions. Through our integrity program, we continuously evaluate real-world conditions and ensure compliance with 4C requirements.

Commitment to Action

Currently, 4C is undergoing a system revision, and we welcome stakeholder feedback to strengthen our certification framework. We invite Empower LLC, ProDESC, and Coffee Watch to share insights from their assessment and engage in an open dialogue on potential recommendations, as collaboration is key to driving meaningful progress in the sector which can only be achieved if stakeholders go hand in hand.

 

Cologne, 19^th February 2025

 

The full statement can be downloaded here 4C Statement

4C Statement on “Ghost Farms and Coffee Laundering: how labour violations enter Starbucks’ and Nestlé’s Chinese coffee supply chain” published by China Labor Watch (with the support of Coffee Watch)

U.S.-based China Labor Watch, supported by Coffee Watch, published a report about “ghost farms,” “coffee laundering,” and labour issues in coffee supply chains in China; these coffee supply chains are either certified under C.A.F.E. Practices or 4C.

4C is an independent stakeholder-driven organization, which values external findings and constructive feedback, as provided in the report. 4C views these findings as an opportunity for reflection and will consider this valuable input to improve the operations, monitoring, and system. 4C certifies 1.8 million tons of green coffee annually in 20 countries. More than 90% of the 4C farmers are smallholders. The average size of the more than 300,000 farms is 2.5 ha. Nestlé is a system user of 4C, as are several other major brand owners.

4C takes the report seriously, and would like to clarify and comment on the key findings as follows:

• Informal employment relationships and piece-rate pay systems incentivise labour rights violations

4C is aware that informal employment relationships and piece-rate payment systems pose a risk to the protection of labour rights. Therefore, the 4C Code of Conduct explicitly requires fair labour contracts for all workers, with written agreements mandated, unless verbal agreements are permitted for temporary workers complying with national laws and regulations. 4C does not accept informal employment relationships and requires authorized worker representation.

A piece-rate payment system may cause labour rights violations if the equivalent total remuneration (e.g. for an 8-hour workday) is lower than the minimum wage. Piece-rate payment systems are common in the agricultural sector; the coffee sector is not an exception and is often a necessity for seasonal harvesting work. According to 4C criteria, all workers must be paid at least the minimum wage, therefore requiring that piece-rate payment systems are fair and implemented effectively. Piece-rate systems applied accordingly enable workers to earn higher wages than the minimum wage.

• Lack of direct contractual relationships between coffee firms, certified estates, and smallholder farms

In the 4C system, the sourcing from unregulated “ghost farms,” allowing coffee to be laundered into the global market, is explicitly not allowed and classified as a critical non-compliance, which will result in the withdrawal of the certificate.

The 4C system includes robust traceability requirements to ensure transparency and accountability across the coffee supply chain. Coffee must originate from farms and supply chain entities that are part of the 4C Unit. 4C requires that all farms supplying coffee within a 4C unit must be registered and accounted for. These requirements enable buyers to verify that coffee labelled as 4C-compliant meets the sustainability criteria and originates from certified sources. Certified entities must maintain detailed records to track the flow of 4C-compliant coffee through the supply chain.

The report implies that smallholders cannot be certified under the 4C framework and are therefore obliged to sell to large estates in an informal manner. This is not correct, as 4C pursues an inclusive approach to enable smallholder coffee producers to enter certification and not to be marginalized in global markets. The 4C system offers tailored support and certification pathways to ensure smallholders can participate. This includes group certification options, capacity-building programs of the 4C Managing Entities, and simplified documentation requirements to accommodate their limited resources. In the 4C system, smallholders are producers whose workforce consists primarily of family or household labour or workforce exchange with other members of the community, and whose coffee farm size is context-dependent but usually ranges from less than 1 hectare to 5 hectares of coffee-growing land. Based on this definition, most of the farmers certified under 4C in China are smallholders.

In addition, the 4C Code of Conduct requires the establishment of traceability systems to verify that the volume of 4C certified coffee is traded only between registered farmers (regardless of their size), service providers and the Managing Entity. Coffee trade has to be reported, and physically segregated from non-4C certified coffee. The traceability system is audited on-site to verify that the amount of 4C certified coffee sold aligns with the size and capacity of the registered fields within a 4C unit, which must be supported by documentation such as contracts, invoices, and delivery notes. This should avoid a situation in which “ghost farms” laundering non-certified coffee into global markets.

• Child Labour

The report describes a case of child labour in which a child was sorting defective beans in a workshop. The report also mentions young family members helping out during summer breaks by picking and sorting coffee beans. These tasks are not considered hazardous work and are in principle in line with international conventions.

4C does not allow the employment of children below the legal minimum age as per the laws of the country where the coffee is produced or in alignment with international standards. In case of discrepancies, the stricter rule shall always be followed. The 4C system strictly prohibits any type of child labour as defined by international conventions, such as ILO C182.

Children carrying heavy loads and being exposed to chemicals are issues not in compliance with 4C. 4C includes specific requirements to ensure that children are not exposed to agrochemicals, in alignment with its sustainability standards and the prohibition of child labour in hazardous environments.  E.g., children are strictly prohibited from handling, applying, or being involved in the preparation of agrochemicals (e.g., pesticides, herbicides, or fertilizers) or entering fields or areas recently treated with agrochemicals. The 4C system includes several requirements regarding appropriate handling and storage of chemicals, in line with ILO, Stockholm Rotterdam, and Montreal Conventions, e.g. prohibition of hazardous chemicals, minimization of chemical uses, safe storage and application practices, disposal and waste management.

4C is committed to further strengthening the external verification of any form of child labour within 4C certified units. The report refers correctly to the 4C Guidance on the Protection of Children’s Rights, which already includes clear definitions and examples of child labour, as recommended in the China Labor Watch report. In addition, the new 4C Code of Conduct will require certificate holders to perform a holistic Child Labour Risk Assessment (CLRA). This process will evaluate the likelihood and underlying drivers of child labour in the regions of operation, enabling 4C certificate holders to identify risk factors and implement targeted measures to address them effectively.  This will take effect with the 4C System Revision of the Code of Conduct v.5.0 aimed for 2025.

• Contractual conditions (wages, working hours, paid leave, insurance)

4C requires certified units to be compliant with at least legal regulations and fair employment conditions, including working hours, breaks, and holiday entitlements. These regulations and the 4C audit checklist are regularly reviewed and benchmarked against SAI Platform’s Farm Sustainability Assessment 3.0 (FSA) Silver and Gold requirements to ensure compliance with internationally recognized standards. The report states that coffee pickers are being paid RMB 80 – 200/day, barely meeting minimum wage. The minimum wage for piece-rate workers in Yunnan province is RMB 1,990 per month. If the median of the wide range mentioned in the China Labor Report is taken, a piece-rate worker working 5 days a week would earn RMB 2,800, 40% above minimum wages.

According to the Labour Law of the People’s Republic of China, employees who have worked continuously for more than one year are entitled to paid annual leave. Therefore, by law, temporary workers are not entitled for paid annual leave if they have not worked continuously for more than one year. Another issue reported is a 7-day workweek schedule for three consecutive months – this is not allowed in the 4C system. Regarding insurance, which is clearly an institutional issue, the report states that farmers have signed in to the new Rural Medical Insurance scheme.

• No protective gear

The report indicated that workers were not provided with protective equipment, thereby increasing the risk of injuries. 4C requires its farmers, service providers and Managing Entities to establish a health and safety program to identify major risks at the workplace and train workers accordingly. In addition, workers must be provided suitable protective clothing and equipment for free. This is a major requirement in the 4C system; non-compliance requires immediate corrective measures to rectify the bad practices, otherwise, the certificate will be withdrawn.

• Discrimination against indigenous communities

The report also highlights systemic discrimination against indigenous communities, including cultural and linguistic marginalization, and exclusion from key processes. 4C emphasizes the importance of equal rights and non-discrimination, requiring certified entities to identify and support groups potentially vulnerable to exploitation or marginalization. 4C certification includes robust requirements on non-discrimination and gender equality with regards to access to rights, resources, education, and representation.

The report entails an accurate description of 4Cs criteria and refers to the main due diligence requirements. Verification of compliance with the 4C requirements are conducted by independent external certification bodies. Only if units are compliant with 4C requirements, can a certificate be issued. It is a core focus of 4C to make sure that non-compliances are detected by auditors. Furthermore, 4C requires certification bodies to conduct risk assessments prior to conducting audits. Risk assessments allow for audit planning based on specific ecological and social challenges present in the respective area.  Auditors therefore need to fulfil a high level of qualifications and are trained by 4C.

4C operates its own integrity program, which double-checks the work of the auditors (“watch the watchman”) and also manages a grievance and complaint channel, open to all stakeholders. Findings from the integrity program and our grievance and complaint channels contribute to the continuous improvement of the 4C system. Integrity audits of Nestlé units carried out so far have not shown major non-compliances as described in the China Labor Watch report.

Social auditing remains challenging due to the complexity of the topics. 4C has recently been granted the ISEAL Innovations Fund for a project aimed at enhancing social auditing and the identification of human rights violations for both external third-party certification bodies and internal monitoring by the certificate holders. Learnings from the project will be integrated into the revision of the 4C system.

4C is fully committed to analyse the risks of relevant issues reported and address them with tailored interventions. 4C will evaluate the actual situation and compliance with 4C requirements through its integrity program. 4C invites China Labor Watch to share details of the assessment and is open to discuss recommendations arising from this.

This statement is available here in PDF format.

Join us at the Asia International Coffee Conference!

4C is excited to announce its participation as a sponsor and exhibitor at the Asia International Coffee Conference, taking place on December 3rd and 4th, 2024.​

Key Highlights:​

• Keynote Presentation: Dr. Norbert Smith, Managing Director, will deliver a keynote presentation on “EUDR and Beyond: Other Regulatory Impacts on Asia and Vietnam“. Check the agenda here.​
• Panel Discussion: Dr. Norbert Smith will also participate in a panel discussion on EUDR and Threshold​
• Exhibition Booth: Visit Booth No. 6 to connect with our team, including Mrs. Viet Ha Nguyen, Senior Sustainability Manager, and learn more about how 4C is driving sustainable coffee practices.​

Want to schedule a meeting with our team? Please contact us to register: nguyen@4c-services.org​

Venue address: Reverie Saigon Hotel located in 22-36 Đ. Nguyễn Huệ, Bến Nghé, Quận 1, Thành phố Hồ Chí Minh, Vietnam.

Let’s shape the future of sustainable coffee together!

On Friday, October 11th, 4C had the pleasure of hosting a delegation from the Vietnam Coffee Cocoa Association (VICOFA) with representatives of VICOFA board and VICOFA members such as Vinhhiep Company Limited., Cat Que Coffee co., Olympic Coffee Jsc., and the Community Development Centre – CDC (CDC). The visit, led by Mr. Nguyen, Nam Hai, President of VICOFA, marked a significant step in strengthening our relationship with the Vietnamese coffee and cocoa industry.

Vietnam plays a crucial role in the global coffee landscape. As the world’s second-largest coffee producer, with 17% of global production in 2023-2024 (according to USDA info), Vietnam is a key player in shaping the industry. This significance extends to sustainable coffee production, as Vietnam holds the top spot for 4C-certified coffee (until December 2023). With 36% of all 4C-certified coffee and a staggering 59% of the world’s 4C-certified Robusta grown there, Vietnam is a leader in ethical and sustainable coffee practices.

During the meeting, we engaged in fruitful discussions on a wide range of topics, including:

• EUDR implementation: Exploring strategies to ensure compliance with the European Union Deforestation Regulation (EUDR). 28 Vietnamese 4C certified units have successfully completed the EUDR compliance checks, demonstrating a strong commitment to sustainable and responsible coffee production. With 12 more units currently undergoing assessment and an additional 50% expected to complete the process soon, Vietnam’s 4C certified coffee sector is well-positioned to meet the stringent requirements of the EU Deforestation Regulation.
• Human Rights Due Diligence requirements: Understanding the requirements and learning from good experiences from MCS (Grievance mechanism, Child labour, etc.) and cooperation between 4C and Meo Carbon Solutions to explore the cooperation on ground with Vietnamese stakeholders in coffee sector
• Market requirements: Understanding the evolving demands not only for European market, but also the US and Japan market, for Vietnamese coffee products.
• Strengthening system regulations: Exchange the practical experiences for sustainable coffee standards on the field, which is valuable input for 4C to strengthen system requirements in the future.
• Potential collaboration: Exploring potential partnerships with VICOFA members with 4C Services, Meo Carbon Solutions, and GRAS – Global Risk Assessment Services to drive positive change in the coffee and cocoa sector. 4C and VICOFA are pleased to concretise their cooperation in the near future to join the organisation of the 4C Regional Stakeholder Conference for Vietnam and the region, to be held in December this year.

This visit underscores 4C’s commitment to fostering strong partnerships with key stakeholders in the coffee industry. We look forward to continuing our collaboration with VICOFA and working together to promote sustainable and ethical coffee and cocoa production.

4C, as a leading organization in sustainable coffee certification, has been awarded a grant from the ISEAL Innovations Fund for a groundbreaking project aimed at enhancing social auditing and the identification of human rights violations for both external third party certification bodies and internal monitoring by the certificate holders.

Project Overview

Over the next 24 months, 4C will develop a holistic and socially sensitive auditing methodology, including practical tools and supporting materials to enhance the detection of human rights violations during on-site audits. This project will be executed in collaboration with partners such as Meo Carbon Solutions, ISCC and a number of 4C cooperating Certification Bodies.

Key Objectives and Activities

The primary goal is to improve the identification, assessment, and management of social risks and human rights violations. Initial efforts will focus on stakeholder consultation and needs assessment to design effective auditing and capacity-building methodologies.

Activities will include:

• Baseline assessment with Certification Bodies and auditors on current auditing techniques and challenges.
• Consultation with 4C Managing Entities and ISEAL community members
• Revision of the Internal Management System (IMS) and creation of templates for internal risk assessment
• Developing a hybrid auditing approach and tools combining in-person and e-learning methods
• Elaborating a comprehensive training package (including a training pilot with Certification Bodies and Managing Entities) to support the capacity building of auditors and improve the internal management and monitoring system of the MEs.
• Integration into 4C System and results dissemination.

Innovation and Impact

The project emphasizes a participatory approach, ensuring the inclusion of voices from affected communities. Auditors will be trained to recognize, and document nuanced human rights issues while maintaining confidentiality and objectivity. The initiative aims to integrate these improvements into the 4C Certification System, enhancing its social impact.

By improving social auditing techniques that support transparency, risk mitigation and stronger grievance mechanisms, the project aspires to foster greater accountability and continuous improvement in the internal and external detection of human rights violations. Certified entities, auditors, and local communities will benefit from increased capacity to detect social risks, ultimately leading to better protection of human rights across the coffee supply chain.

Conclusion

With the grant from the ISEAL Innovations Fund, 4C’s project represents a significant step towards detecting human rights issues in the coffee sector. By enhancing social auditing processes and integrating community voices, the initiative aims to create a more transparent and accountable certification system, ultimately improving the wellbeing of coffee farming communities worldwide.

This project was made possible thanks to a grant from the ISEAL Innovations Fund, which is supported by the Swiss State Secretariat for Economic Affairs SECO and UK International Development from the UK government.

 

 

About the ISEAL Innovations Fund

The ISEAL Innovations Fund (‘the Fund’) is ISEAL’s grant making-facility, co-developed and funded by the Swiss State Secretariat for Economic Affairs SECO since 2016, which supports the exploration of innovations that help sustainability systems deliver more value to their stakeholders and effectively drive improvement over time, and at scale. The Fund launched a second phase of work in 2023. Grants in phase two (2023 – 2027) are made possible through financial support of SECO and UK International Development from the UK government. This grant empowers sustainability systems to develop innovative partnerships, approaches, and scalable solutions. It offers technical support, guidance, and promotes cross-sector learning within and beyond the ISEAL community. The fund focuses on innovation, relevance, replicability, beneficiary engagement, monitoring, collaboration, and value for investment.

Simexco Dak Lak has become the first company to comply with the requirements of the European Union Deforestation Regulation (EUDR) using 4C certification. The EUDR aims to curb global deforestation by ensuring that commodities imported into the EU do not contribute to deforestation or forest degradation. This regulation, effective from the end of 2024 onwards, requires companies to demonstrate that their supply chains are free from deforestation and maintain detailed records of their sourcing practices. Additionally, companies must comply with national laws, international conventions, such as the International Labour Organization (ILO) core conventions, and the Rights of Indigenous Peoples, including the principle of Free, Prior, and Informed Consent (FPIC).

EUDR Overview

The EUDR was enacted to combat global deforestation. By enforcing stringent measures, the EUDR seeks to ensure that agricultural commodities, including coffee, cocoa, soy, and palm oil, entering the EU market are not associated with deforestation or forest degradation. Companies must prove that their supply chains are deforestation-free through comprehensive traceability systems, polygons and geo-coordinates to prove that their operations are in line with local legal regulations. This involves maintaining detailed records of the origin of their products and providing evidence that these sources comply with sustainable land use practices. Non-compliance can lead to severe penalties on the operator, the trader importing the respective commodity to or exporting from the EU, including fines and import bans, underscoring the EU’s commitment to environmental protection.

Simexco Dak Lak’s Commitment

Simexco Dak Lak, founded in 1993, has a history of pioneering efforts in sustainable coffee production. Over the years, the company has grown to become a leading coffee exporter in Vietnam. The company collaborates closely with local farmers, providing them with training and support to adopt sustainable practices that meet international standards.

To achieve compliance with EUDR, Simexco collected all the necessary data such as geo-coordinates and polygons required by the EUDR. These were checked by 4C and uploaded to the 4C Portal. In addition, they ran the legality self-assessment based on the 4C Code of Conduct, available open source on the 4C website and signed the attached self-declaration on legal production.

4C Certification: A Cornerstone of Success

Central to Simexco Dak Lak’s success is its 4C (Common Code for the Coffee Community) certification. The 4C certification is a globally recognized standard for sustainable coffee production, emphasizing economic viability, social responsibility, and environmental stewardship. This certification played a crucial role in helping Simexco Dak Lak meet EUDR requirements by providing a robust framework for sustainable practices.

The 4C certification ensures that coffee is produced in a manner that conserves biodiversity, reduces greenhouse gas emissions, and promotes fair working conditions, among other social, economic and environmental principles of good and recognized practices. For Simexco Dak Lak, adhering to 4C standards meant implementing comprehensive traceability systems, ensuring that all coffee production processes were transparent and verifiable. This certification validated the company’s sustainable practices and enhanced its credibility in the international arena.

Celebrating Success

The achievement was celebrated in a recent ceremony, underscoring Simexco Dak Lak’s role in the coffee industry. This milestone sets a benchmark for other companies in the region and highlights the importance of sustainable practices in ensuring long-term success and environmental protection. The company’s commitment to 4C standards demonstrates how certification can drive compliance with global regulations and promote a sustainable coffee sector.

For more details, visit the Simexco Dak Lak and VietnamPlus articles.

We are proud to announce that 4C has joined the Swiss Sustainable Coffee Platform (SSCP), a significant step forward in our mission to promote sustainability in the coffee industry.

About the Swiss Sustainable Coffee Platform

The SSCP, launched on June 6, 2024, is a collaborative initiative that brings together the Swiss coffee industry, the State Secretariat for Economic Affairs (SECO), civil society, and academia. The platform aims to create a coffee industry that respects human rights, protects the environment, and ensures sustainable sourcing practices, ultimately improving the livelihoods of coffee producers and their families.

Benefits of Membership

Membership in the SSCP offers 4C access to a wealth of shared resources, know-how, and best practices. This collective knowledge enhances our ability to address systemic sustainability issues such as climate change and living income for coffee farmers. Additionally, our participation in the SSCP enables us to collaborate on public-private partnership projects in coffee-producing countries, co-financed by SECO.

Our Commitment to Sustainability

As a member of the SSCP, 4C is committed to:

• Leveraging collective knowledge to tackle key sustainability challenges.
• Participating in and promoting projects that improve living conditions and economic resilience for coffee farmers.
• Engaging in policy dialogue and peer exchanges to foster continuous improvement in sustainability practices.
• Collaborating with other members to navigate regulatory requirements in a pre-competitive context.

Looking Ahead

Joining the SSCP aligns with our ongoing efforts to advance sustainability in the coffee value chain. We are excited about the opportunities this membership presents and look forward to working closely with other SSCP members. By sharing insights and learning from one another, we aim to make a substantial impact on the coffee industry, benefiting producers, their families, and the environment.

Stay tuned for further updates on our initiatives and progress as part of the Swiss Sustainable Coffee Platform. Together, we can build a more sustainable future for the coffee industry.

For more information about the SSCP and our involvement, please visit the SSCP website.