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FACULTY OF LIBERAL ARTS & PROFESSIONAL STUDIES

SCHOOL OF ADMINISTRATIVE STUDIES

AP/ADMS1000

INTRODUCTION TO BUSINESS

Summer 2024 - ALL SECTIONS

MINI CASE

Weighting: 15%

Available: Friday, May 24, 2024 (9am Toronto Time)

Submission Deadline: Friday, May 31, 2024 no later than11:59pm (Toronto Time)

INSTRUCTIONS – READ THESE CAREFULLY

1. This Mini Case is submitted online and is an open-book activity. You may consult your notes and textbook and eClass materials posted for the course. However, you must not -- under any circumstances -- be searching for materials, examples or any answers (using Google, Bing, DuckDuckGo and other search engines in search of answers or analysis is strictly prohibited).

2. Keep track of time, so that you have sufficient time to upload your answer before the deadline. You must complete and submit your answers by the deadline (Toronto time). A grade of zero will apply if you do not submit your answers on time. Please remember that extensions will NOT be provided.

3. Preparing your answers:

• Write the Mini Case answers on your computer/device.

• Ensure that you save your file regularly, so that you do not lose your work. • NAME your file clearly, so that you know which file you are going to upload. • File format: You must submit your work as a Word file (or PDF). If you use a different format to prepare your answer, ensure you can export the file (save as) as a Word or Pdf document when you are ready to submit (this export option is available in Google docs, Pages, etc). iOS/Mac users: you will NOT be able to load a “Pages” file – the posting will fail and you will lose valuable time.

4. Submitting your answer: Upload your file (Word or Pdf) to the Mini Case turnitin submission link on the your sections’ eClass website (link name: “MINI CASE - Submit your

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answer file here”). Turnitin results will be used as part of the academic integrity assessment of the exam. Start submitting your file a few minutes before the deadline, to ensure you do not miss the deadline. Remember to upload the correct file (not a draft or another.) DO NOT upload Pages format, as it will not be accepted by the system.

5. Technical issues: Contact YU tech support: [email protected] or +1.416.736.5800 during business hours. Do not leave submission to the last minute, as late submissions will not be accepted. Do not email your answer file to your professor unless you are going to miss the deadline; note that there is no guarantee that an emailed assignment will be accepted.

6. Page limits and writing formatting requirements:

• Word limit: 1,000 words max (plus any references). In other words, citations or references are not included in the Word count limit. No bibliography is required for this Mini Case assignment.

• Font size: 12 point

• Font style: Arial

• Line Spacing: 2 (double)

• Margins: 1-inch margins (or 2.54 cm margins)

• Identification: Include your name and student ID at the top of each page. (you may use the “header” option for that; no title page required)

7. Citation: Any material you use in your answer that is not your own (textbook or eClass materials) should be cited (referenced properly). Presenting some else’s ideas in your own words requires citation. See also, Academic Honesty below.

• Citation is expected; however, no specific citation format is required (In-text citations or footnotes may be used).

• Page numbers must be used for verbatim quote citation.

• External research (searching for or soliciting materials and ideas from sources other than the textbook or eClass materials) is prohibited.

• No bibliography is required for this Mini Case assignment.

8. Penalties: Late submissions will not be accepted. Page Limits: There are no penalties for going over the page limit. However, anything beyond 1,000 words will not be marked.

9. Academic Honesty: Students are expected to adhere to the highest of academic integrity standards. When submitted the Mini Case, you attest that the work you are posting is yours, and only yours, and that you have not used any assistance in content or editing of your work (or provided such to others). Furthermore:

• You acknowledge that cheating on an assignment/exam, including impersonation and plagiarism are considered a breach of Academic Honesty and are punishable under the regulations of the Senate of York University. Examples of such actions include (but are not limited to) using unauthorized aids and assistance, copying or otherwise using the work of others without proper citation, impersonating another person, using answers that you have purchased or received without charge.

• You acknowledge that speaking with or seeking advice from other people during the

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exam, as well as sharing assignment/exam content or answers during the exam, are a breach of Academic Honesty and are punishable under the regulations of the Senate of York University. • You acknowledge that the assignment/exam materials are the property of the instructor and/or publisher. Any printing, saving, recording, sharing, copying, or dissemination in any form of the assignment/exam materials (or parts of them) before, during or after the assignment/exam are considered a breach of Academic Honesty and a violation of Canadian Copyright law (copyright.info.yorku.ca), and are punishable under the regulations of the Senate of York University. Any breach of academic integrity will be pursued.

10. Marking Results: You will be able to access your graded paper in Turnitin once grades are released. General (not individualized) feedback / debrief will be provided through eClass. An announcement will be posted in eClass when papers and marks are available.

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Mars and the global chocolate industry

Chocolate, a tasty treat, is derived from the cocoa bean which grows in the tropical regions of Western Africa, Asia, and Latin America. Western Africa supplies about 70% of the world’s cocoa. But how chocolate gets grown and harvested has been linked to child labour, human trafficking and slavery.

Over the years, journalists have found the widespread use of child labour in many cocoa farms in Guinea, Nigeria, Cameroon, Sierra Leone, Ghana and the Ivory Coast. However, little has been done by chocolate companies and their suppliers to change this growing problem.

International chocolate companies such as Mars, Hershey’s and Nestle have argued they have corporate social responsibility programs to prevent child labour, but some analysts question how effective these programs are.

In a November 2023 investigation, CBS News, a U.S. news agency, found children in Ghana as young as five years old harvesting cocoa beans for the U.S. multinational, Mars. While the company claimed to be eradicating child labour from its supply chains, the CBS reporters found something quite different.i

“Only a third of the 300 students registered at one school visited by CBS News actually attend[ed] classes. All students said that they harvested cocoa either before or after school.” ii One observer saw children use a machete blade to try to open cocoa pods, apply pesticide chemicals and engage in other hazardous tasks on cocoa plantations. iii

In the CBS News interview, one farmer admitted that records are often falsified to meet requirements by the companies, and no one checks any further. No Mars executives or employees ever visit the farms.

A spokesperson for Mars explained,

“We condemn the use of child labor… We treat any claim of misconduct in our supply chain very seriously and we will thoroughly investigate once we have the necessary information and take appropriate action. Our cocoa suppliers in Ghana have agreed to adhere to our robust Supplier Code of Conduct and we have also been clear that they must have a Child Labor and Remediation System (CLMRS) in place by 2025 that complies with the industry leading International Cocoa Initiative (ICI) standard. Over 65% of our cocoa supply in West Africa is already covered by CLMRS which is implemented by our suppliers on the ground, with audits conducted by certification bodies as part of Rainforest Alliance and Fairtrade certification requirements.” iv

However, many advocates agree the problem of child labour is a complex one. Cocoa is an important export for many of these countries. For example, cocoa is the Ivory Coast’s most important product, making up half of its agricultural exports in volume. v Farmers, however, still earn less than $1 per day, below the poverty line.vi Therefore, using child labour can help keep their prices low and competitive. It is estimated that 2.1 million children in Ghana and the Ivory Coast work on cocoa farms. vii Some children work on farms to support their families; others are trafficked and forced to work against their will without pay. viii

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In August 2023, International Rights Advocates, a nonprofit group, filed a U.S. Federal lawsuit to try to force the U.S. Federal Government to block imports of cocoa harvested by children in West Africa. The lawsuit sought to use a 1930’s Federal law that required the government to ban products entering the United States if they are produced by children. However, by March 2024, this ban had not yet been implemented.ix

The Chocolate Manufacturer’s Association has argued that no legislation is needed because the industry has already taken steps to deal with the problem of child labour and is making significant progress. x One step includes getting third-party organizations to do farm inspections to certify that no child labour exists. Some organizations also verify what farmers earn to show a fair wage was paid.

While certification programs exist, audits are often announced in advance, allowing farmers to hide any evidence of their rule violations. xi

“In 2010, the founders of the “Fair Trade” certification process had to suspend several of their Western African suppliers due to evidence that they were using child labor. Additionally, in 2011, a Danish journalist investigated farms in Western Africa where major chocolate companies buy cocoa. He filmed illegal child labor on these farms, including those certified by the now merged certification bodies, UTZ and Rainforest Alliance. Another advocate found trafficked children laboring on Fair Trade certified cocoa farms in the Ivory Coast as recently as May 2017.”xii

By 2021, eight children filed a lawsuit against Nestle, Cargill, Mars, Hershey, Mondelez and other corporations for illegal enslavement in cocoa plantations, where they were forced to work without pay. The plaintiffs, now adults, sought damages for negligent supervision, emotional distress, and unpaid compensation. The main allegation of the lawsuit is that the chocolate companies knowingly profited from the illegal work of children and did nothing to stop it.xiii

Many observers agree that there are problems in tracing the origin of cocoa through the various global supply chains, and many issues need to be addressed. First, there are no strict, international auditing standards that are applied and enforced on all cocoa farms across all countries. Second, while some child labour laws do exist, enforcement by governments across countries vary, and is limited by a lack of funding. Third, forced labour across borders is ongoing, as people move and are trafficked between countries.

““These companies kept saying, ‘We can’t trace it back,’…… said former [U.S.] Senator Tom Harkin, who led a push for legislation to reform the industry, but ended up agreeing to a protocol that allows corporations to regulate themselves. “They just won’t do it because it will cost them money.” xiv

“Harkin said Americans don’t realize the treats they hand their children originate with child abuse.”xv “It’s not just the chocolate you eat, it’s the chocolate syrup you put on your ice cream, the cocoa you drink, the chocolate chip cookies you bake,” he said. xvi

Still, advocates are hopeful that there is much more that can be done.

The chocolate industry is a profitable one, with approximately $103 billion a year in sales and growing. xvii In recent years, many consumers are also turning to chocolate for its health benefits.

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Dark chocolate that contains at least 70% cocoa is considered to have health benefits due to its lower sugar and higher antioxidant content. xviii Demand for chocolate in Europe is expected to grow by 4.3% by 2033. xix Chocolate is also used in confectionary products, biscuits and bakery, dairy and desserts, ice-cream and frozen items, cereals and other food products. xx

“The World Cocoa Foundation, which represents major cocoa companies, said it is committed to “improving livelihoods of cocoa farmers and their communities.” xxi

Human rights advocates, however, argue that the industry association is not doing enough, and that the problem is even challenging for many governments to manage.

In the Ivory Coast (officially the Republic of Côte d'Ivoire), regional police units have done random searches of cocoa plantations and have arrested more than 1,000 traffickers since 2012. In 2021, police saved 2,116 children and arrested 25 people. Of these, five people were sentenced to 20 years in prison.

Yet, child labour remains a significant problem. And many children who do not attend school to work on farms do not receive an education and continue the cycle of poverty.

Mars, a private company, is estimated to have over $40 billion in annual sales. Its four business segments consist of petcare, Mars Wrigley confectionery, food and edge. However, it is best known for its global chocolate empire. xxii Mars, founded in 1911 by Frank Clarence Mars and his wife Ethel, has expanded to over 100 countries and employs more than 100,000 people worldwide.xxiii

Today, the Mars family owners are the third wealthiest family in the U.S. xxivThe company has a strong reputation for philanthropic endeavors. For example, in 2017, the company made a US$1 billion investment in a sustainability program to contribute to the US’s Sustainable Development Goals and the Paris Climate Agreement.xxv The company also continues to support initiatives to prevent child labour on cocoa farms.

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Case Questions: (Total: 30 marks)

Question 1 (20 marks)

Explain how the six (6) external environmental factors have impacted or are impacting Mars. Explain your answer using examples from this case.

Question 2 (10 marks)

Explain how the behavioural management approach may be beneficial for Mars and why? Explain your answer using examples from this case.

Please note: No outside research is required. However, a complete, detailed and thorough answer including all relevant examples is required for full marks.

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End Notes:

i Patta, Carter, Guzman and Breen. Candy Company Mars uses cocoa harvested by kids as young as 5 in Ghana” CBS News investigation. CBS News. November 29, 2023. https://www.cbsnews.com/news/children-harvesting-cocoa-used-by-major-corporations-ghana/ ii Patta, Carter, Guzman and Breen. Candy Company Mars uses cocoa harvested by kids as young as 5 in Ghana” CBS News investigation. CBS News. November 29, 2023. https://www.cbsnews.com/news/children-harvesting-cocoa-used-by-major-corporations-ghana/ iii Balch, Oliver. Mars, Nestle and Hershey to face child slavery lawsuit in U.S. The Guardian. February 12, 2021. https://www.theguardian.com/global development/2021/feb/12/mars-nestle-and-hershey-to-face-landmark-child-slavery-lawsuit-in-us

iv Patta, Carter, Guzman and Breen. Candy Company Mars uses cocoa harvested by kids as young as 5 in Ghana” CBS News investigation. CBS News. November 29, 2023. https://www.cbsnews.com/news/children-harvesting-cocoa-used-by-major-corporations-ghana/ v Child labour and slavery in the chocolate industry. The Food Empowerment Project. https://foodispower.org/human-labor-slavery/slavery-chocolate/ vi Child labour and slavery in the chocolate industry. The Food Empowerment Project. https://foodispower.org/human-labor-slavery/slavery-chocolate/ vii Child labour and slavery in the chocolate industry. The Food Empowerment Project. https://foodispower.org/human-labor-slavery/slavery-chocolate/ viii Child labour and slavery in the chocolate industry. The Food Empowerment Project. https://foodispower.org/human-labor-slavery/slavery-chocolate/ ix Mendoza, Martha. Your favorite chocolate is probably produced by West African child labour and the government doesn’t care, advocates argue in lawsuit. The Associated Press. August 15, 2023. https://fortune.com/2023/08/15/chocolate-cocoa-child-labor-west-africa-lawsuit-hershey-nestle-mars/ x Child labour and slavery in the chocolate industry. The Food Empowerment Project. https://foodispower.org/human-labor-slavery/slavery-chocolate/ xi Child labour and slavery in the chocolate industry. The Food Empowerment Project. https://foodispower.org/human-labor-slavery/slavery-chocolate/ xii Child labour and slavery in the chocolate industry. The Food Empowerment Project. https://foodispower.org/human-labor-slavery/slavery-chocolate/ xiii Balch, Oliver. Mars, Nestle and Hershey to face child slavery lawsuit in U.S. The Guardian. February 12, 2021. https://www.theguardian.com/global development/2021/feb/12/mars-nestle-and-hershey-to-face-landmark-child-slavery-lawsuit-in-us

xiv Mendoza, Martha. Your favorite chocolate is probably produced by West African child labour and the government doesn’t care, advocates argue in lawsuit. The Associated Press. August 15, 2023. https://fortune.com/2023/08/15/chocolate-cocoa-child-labor-west-africa-lawsuit-hershey-nestle-mars/ xv Mendoza, Martha. Your favorite chocolate is probably produced by West African child labour and the government doesn’t care, advocates argue in lawsuit. The Associated Press. August 15, 2023. https://fortune.com/2023/08/15/chocolate-cocoa-child-labor-west-africa-lawsuit-hershey-nestle-mars/ xvi Mendoza, Martha. Your favorite chocolate is probably produced by West African child labour and the government doesn’t care, advocates argue in lawsuit. The Associated Press. August 15, 2023. https://fortune.com/2023/08/15/chocolate-cocoa-child-labor-west-africa-lawsuit-hershey-nestle-mars/ xvii Child labour and slavery in the chocolate industry. The Food Empowerment Project. https://foodispower.org/human-labor-slavery/slavery-chocolate/

xviii The industrial Chocolate Market. 2023. https://www.futuremarketinsights.com/reports/industrial-chocolate

market#:~:text=The%20industrial%20chocolate%20market%20is%20projected%20to%20thrive%20at%20a,CAGR%20from%202023%20to%202033. xix The industrial Chocolate Market. 2023. https://www.futuremarketinsights.com/reports/industrial-chocolate

market#:~:text=The%20industrial%20chocolate%20market%20is%20projected%20to%20thrive%20at%20a,CAGR%20from%202023%20to%202033. xx The industrial Chocolate Market. 2023. https://www.futuremarketinsights.com/reports/industrial-chocolate

market#:~:text=The%20industrial%20chocolate%20market%20is%20projected%20to%20thrive%20at%20a,CAGR%20from%202023%20to%202033. xxi Mendoza, Martha. Your favorite chocolate is probably produced by West African child labour and the government doesn’t care, advocates argue in lawsuit. The Associated Press. August 15, 2023. https://fortune.com/2023/08/15/chocolate-cocoa-child-labor-west-africa-lawsuit-hershey-nestle-mars/ xxii Hoffower, Hillary. Notoriously secretive: The mysterious family behind the $127b Mars chocolate empire. The Sydney Morning Herald. March 29, 2019.

xxiii Mars and good management make for long-lasting success. Prosperity. Retrieved March 9, 2024. https://www.prosperity.net/mars bar/#:~:text=Mars%20Candies%20applied%20management%20skill,places%20to%20work%20in%20Europe.

xxiv Patta, Debora; Carter, Sarah; Guzman, Javier; and Breen, Kerry. Candy company Mars uses cocoa harvested by kids as young as 5 in Ghana: CBS News investigation. CBS News. November 29, 2023. Video: https://www.cbsnews.com/news/children-harvesting-cocoa-used-by-major corporations-ghana/

xxv Hoffower, Hillary. Notoriously secretive: The mysterious family behind the $127b Mars chocolate empire. The Sydney Morning Herald. March 29, 2019.

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