Combating Child Labor in the Supply Chain in India

Child labor cannot simply be eliminated by decree. To this day it remains deeply rooted in many societies. In particular, subsistence farmers still frequently resort to child labor to manage their fields. Implementing the effective abolition of child labor may be laborious and time-consuming for businesses if child labor is the norm. Yet pursuing this approach is worthwhile in every way, as shown by an example from India.

In India child labor can still be found in many parts of everyday life. Some years ago, the International Labour Organization (ILO) found that the subcontinent has the highest number of working children worldwide, with an estimated 5.6 million working in agriculture alone. In the face of this enormous social challenge, can companies make a meaningful contribution at all?

Bayer in India has now been focusing on this question for more than 10 years. In 2002, the company’s agricultural business unit, Bayer CropScience, acquired an Indian company that was active in seeds. In areas such as the states of Andhra Pradesh and Karnataka – where child labor is particularly widespread – contract farmers were growing cotton seeds on behalf of the newly acquired company. Bayer – one of the first companies to become a participant of the UN Global Compact – had long attached great importance to respecting ethical principles, including in the supply chain. In line with one of the Ten Principles of Global Compact – namely that businesses should uphold the effective abolition of child labor – it became clear very soon after the takeover that child labor among the contract farmers was a significant issue.

Apart from all the other arguments against child labor, it robs children of almost all educational opportunities and thus a range of possibilities to determine their own lives. Yet implementing the ban was easier said than done. What evolved out of a steep learning curve was probably one of the most comprehensive sustainability projects in Bayer’s 150-year history: the Bayer CropScience Child Care Program.

But let us start at the beginning: Soon after the local Indian seed company Proagro had been taken over by Bayer as part of the larger international acquisition of Aventis CropScience, a potential child labor issue at Proagro was raised by nongovernmental organizations. And our Indian seeds unit was subject to critical scrutiny. Later, key institutional investors called for more information on how Bayer intended to combat child labor among contract farmers in India.

Initially, Bayer started working together with industry partners that were facing similar problems. That resulted in the foundation of the Child Labor Elimination Group (CLEG) under the Association of Seed Industry, which used communication strategies in particular in an effort to persuade farmers to dispense with child labor in the future. Bayer also developed initial strategies to create economic incentives, with farmers receiving bonuses for complying with the ban. 

Yet because no significant progress was made with the CLEG program, Bayer decided to proceed alone in taking action against child labor. It became increasingly clear that more comprehensive approaches with a longer-term impact were necessary to bring about a real change in mentality in village communities. Thus the Bayer CropScience Child Care Program was launched in 2007. The program extends far beyond abolishing child labor. Besides a contractual ban of child labor, it includes monitoring and control as well as an incentive and sanction scheme. Moreover, it focuses on: engaging local people and combining initiatives to improve education in local governmental schools; increasing awareness about working the fields profitably without resorting to the use of children; knowledge-transfer concerning sustainable crop production; vocational training opportunities for children; as well as communication strategies to raise awareness of the problem among parents.

A dedicated team within Bayer was formed to put this comprehensive program into practice, which has since proven a great success. The latest figures from December 2012 show how many people the program has reached to date: In 2006, an average of around 0.6 children per acre were still being employed on the fields of suppliers – a figure that was, however, already well below what was normal among Indian cotton seed companies. In the 2012/2013 main season, only 21 isolated cases were noted on the 3,898 acres in total managed by suppliers. Sanctions were applied against these immediately. The number of children as a proportion of the total workforce thus went down dramatically to 0.03 percent.

Ultimately, the Bayer CropScience Child Care Program can be described as a genuine win-win situation for all involved. Children now receive education instead of having to work in the fields, giving them a better start in life. Farmers acquire a substantial volume of know-how to improve their cultivation methods, which has resulted in a better quality of the seeds produced, among other benefits. Last but not least, research has shown that farmers’ earnings tend to be higher because they can harvest more. Bayer itself draws positive results from the closer and more efficient collaboration with the farmers. However, the highest benefit lies in the fact that the Group helps combat child labor and is thus living up to its own values and the expectations of society and investors – in India and worldwide.

With this program, Bayer is the first company to have achieved a lasting impact in tackling child labor in India – a commitment that was highlighted for instance in the 9th Human Rights Report of the German federal government. Seeing the Child Care Program succeed was a priority for Bayer CropScience, and the Executive Committee has actively supported it as a core sustainability program. We are convinced that, with such an initiative, we can make a key contribution to eliminating child labor and at the same time help improve the lives of Indian cotton farmers and their children. That is why we have extended the Bayer CropScience Child Care Program to other crop cultivation areas in India.