Louisiana pension sues Hershey over child labor

November 01. 2012 5:00PM

Jim T. Ryan

The Louisiana Municipal Police Employees Retirement System today sued The Hershey Co. in Delaware's Chancery Court seeking to force the Dauphin County-based chocolate maker to open its books as part of a claim that it continues to benefit from illegal child labor in West African cocoa farms.

The pension fund hired the Wilmington, Del., law firm of Grant & Eisenhofer to press its complaint with the court that hears corporate law in Delaware, where Hershey is incorporated, R. Randall Roche, the pension fund’s general counsel, said in an email.

The pension fund is seeking to inspect Hershey’s records as a shareholder of the company to further its complaint with the courts, Roche said.

According to the suit, Hershey has continued to benefit from cocoa production in the West African countries of Ghana and Ivory Coast, which produce 70 percent of the world’s cocoa and where illegal child labor is rampant.

The suit relies heavily on the 2011 Payson Center report on child labor in West Africa cocoa that found only between 5 percent and 10 percent of child laborers were paid. The suit goes on to list additional information from the report, as well as news reports over the last 10 years outlining illegal child labor in West African cocoa.

According to the court complaint, Hershey has had knowledge of illegal child labor activity in West Africa and has been indifferent, refusing on multiple occasions to disclose or discuss its cocoa suppliers with shareholders.

The pension fund is seeking to have Hershey make its records accessible so the pension fund can inspect its cocoa suppliers over the past 10 years, as well as communications among directors and company officials related to its cocoa supply, any illegal activities and child labor, according to the court complaint.

The pension fund asked Hershey open its books in early October, but the company declined, according to the court complaint.

Hershey deflected the charges in its Oct. 12 response letter, according to the complaint, saying it does not buy cocoa directly from West Africa and instead from multinational companies and third-party suppliers.

The suit alleges that Hershey is in violation of U.S. and international law regarding its cocoa sourcing, which benefits from illegal child labor, according to the court complaint.

Hershey did not respond to a request for comment.

On Oct. 3, the Derry Township-based company said it would commit to purchasing all of its cocoa from certified sustainable sources by 2020, an expansion on its earlier commitment to use Rainforest Alliance certified cocoa for several of its products.

Hershey’s shares are traded on the New York Stock Exchange under the ticker symbol HSY.

 


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