Ensuring a Living Wage Across Hershey and Our Supply Chain

We believe that all individuals deserve the opportunity to earn a living wage and income, including the men and women that work for Hershey directly or make their living as part of our supply chain. Hershey recognizes the concepts of living wage and living income as human rights and that mandated minimum wages are not always sufficient to allow workers a basic, but decent, standard of living including but not limited to: adequate housing, food, access to education, childcare and savings for unexpected events. 

In addition, within our extended supply chain, lack of income for smallholder farmers is a root cause of poverty; this increases the risk of other human rights violations such as child or forced labor as well as deforestation.

That’s why we are acting to maintain our strong pay practices within our Hershey operations including continuing to pay a living wage to full-time Hershey employees across our global locations. We are also establishing new partnerships and programming in our cocoa supply chain that will allow us to:

  • Directly measure farmer incomes on Cocoa For Good Farms in Côte d’Ivoire and Ghana to better target our programs and investments focused on improving incomes
  • Strengthen our engagement in the pre-competitive platforms and multi-stakeholder collaborations we feel are critical to enable an environment ultimately needed to promote a living income for cocoa farmers

We have prioritized the following areas for action in the next two years. We will revisit the scope of our current commitment in 2023 including assessing the need for activities in our Tier 1 supply chain and other agricultural commodities such as palm oil and sugar cane.

 

Hershey Employees and Operations

Living wage is only one part of our larger companywide commitment to promote equity and build a more diverse and inclusive workplace. Competitive and fair pay plays a central role in this commitment, including the promotion of gender pay equity, where we currently have closed our gender pay gap with U.S. salaried women and people of color, in aggregate, earning dollar for dollar with male colleagues.

To incorporate a living wage into our approach to compensation for Hershey employees, we partnered with BSR to undertake an assessment of wages in our company operations. This assessment looked at all full-time Hershey employees across our global locations. All Hershey employees currently meet BSR’s living wage benchmarks in their respective locations.

To continue our commitment to paying Hershey employees a living wage, we will:

  • Review employee wages against the BSR benchmark on an annual basis and adjust any pay levels that would fall below the living wage level
  • Continue our efforts on promoting equity for people of color
  • Ensure that all regional compensation managers are trained on the concept of a living wage and that it is incorporated into our annual review process and wage requirements
  • Continue to assess the scope of our living wage efforts, relevant benchmarks and methodologies for measurement, which are continuing to evolve at both the national and international level

Cocoa

Currently, more than 80,000 farmers participate in Hershey’s Cocoa For Good program. Fundamental to our programming are investments focused on increasing assets and resilience, concepts we believe are directly connected to increasing farmer income and poverty. Since 2018 we have gone beyond our 100% certification commitment to support broader sustainable livelihood initiatives in Côte d’Ivoire and Ghana.

These efforts include improving crop yields, work on land tenure titling, alternative income generation projects on-farm and off-farm, financial literacy training, village savings and loan associations (VSLAs), and gender-awareness training.

We are putting in place new partnerships and programs that will allow us to directly measure the incomes of farmers in our Cocoa For Good programs in Côte d’Ivoire and Ghana. This will allow us to better target our programs and investments focused on improving incomes. When we seek to understand the gap between farmer income and living income, we will use benchmarks endorsed by the Living Income Community of Practice.

Our activities in cocoa will include:

  • Continuing to support the West Africa governments’ Living Income Differential (LID) and requiring our suppliers to comply with paying the LID
  • Maintaining our existing commitments to 100% certified and sustainable cocoa and paying certification premiums to farmer groups and farmers who successfully meet internationally recognized environmental and labor standards
  • Using a direct-sourcing model through our suppliers for 100 percent of our cocoa from Côte d’Ivoire and Ghana by 2025, which includes responsible procurement practices such as long-term agreements with suppliers that allows them to foster long-term relationships with farmer groups and continuity of investments focused on asset strengthening, income diversification and professionalization of cooperatives
  • Establishing a new partnership with the global market research firm Ipsos that, along with broader monitoring and evaluation activities, will allow us to gather household income data on Cocoa For Good farms, including insight into income levels by gender and farm size (data collection begins in 2021). This baseline research will allow us to refine our income-based programming and work to improve farmer incomes
  • Participating in the Living Income Community of Practice (LICOP), including supporting new research by LICOP and the Anker Research Network that will contribute to updated living income benchmarks in Côte d’Ivoire and Ghana along with five additional cocoa origins
  • Publishing and reporting on our progress via our website and annual sustainability reports

We will revisit the focus of our commitments in 2023 to assess our progress as well as the opportunity for new programming in other parts of our operations and extended supply chain.

Find out more about our approach in our Living Wage & Income Position Statement