Can Pepsi and Coke end land grabs for sugar?

The Sirinhaem River twists to the southern Atlantic through the Brazilian state of Pernambuco, breaking into a small delta once lush with mangrove trees where Maria Nazarete dos Santos is no longer allowed to live.

Blame the world's ravenous demand for sugar. Dos Santos is a member of one of more than 50 families that lived on small islands and fished the Sirinhamem for nearly a century until 2002. That's when a militia working for the Trapiche sugar company, owner of a nearby mill and cog that supplies major companies like Coke and Pepsi, swept through their villages, burning their dwellings.

Many of evicted islanders remain homeless. They "got no compensation from the company and live underneath the bridge now", Dos Santos told the anti-poverty non-profit Oxfam (pdf) last year in a report on land grabs in the sugar industry. Twelve years after the eviction, the displaced families remain in a court fight with Trapiche and government authorities to return to the islands, but have no land title, clear rights and few legal resources.

It's an all-too-common story in the equatorial belt. The Oxfam report lists 100 large-scale land deals for sugar alone since 2000, and places where commodities such as palm oil and soy are grown have followed a similar pattern. Companies have been snatching up real estate in countries such as Brazil, Cambodia and Zambia, displacing some of the world's poorest and most voiceless inhabitants at a growing rate.

Recently, though, signs of change have emerged.

Under pressure from Oxfam, two global behemoths – Coca-Cola and Pepsi – recently issued new policies on land grabs by their suppliers, including Trapiche, that could have global implications.

In March, Pepsi announced "a land policy with zero tolerance for illegal activities in our supply chain and for land displacements of any legitimate land tenure holders." Coke made a similar statement late last year, in response to Oxfam's social media campaign publicizing its critical report.

Those announcements seem like a sea-change after decades – if not centuries – in which commodity providers have removed native and traditional peoples from land, often with state support in the names of trade and commerce, according to Chris Jochnick, head of Oxfam America's private sector development arm.

"We may be reaching a tipping point," he said, calling the recent developments "remarkable".

Tracing the invisible chain

Given the long history of a lack of transparency by food and beverage companies about their suppliers and 'don't ask don't tell' policies about where raw products come from and who is hurt in the acquisition process, the change that excites Jochnick will likely come slowly.

Pepsi is beginning studies of its supply chains and the conduct of companies from which it buys sugar, said Paul Boykas, PepsiCo's vice-president of public policy and government affairs.

There's a big difference though, between announcing a new policy and ending land grabs throughout a supply chain, Boykas acknowledged.

"We're going to try and bring suppliers along", he said in an interview. "We aren't saying that it'll be easy or that we'll ever get to 100% compliance." Sugar, he noted, may pass through a supply chain five tiers deep before landing in a soda bottle. He was cautious about saying how Pepsi would achieve compliance, but ultimately the hammer may be cutting ties with unethical and shady suppliers.

But first, companies have to unravel a system in which opaqueness seems to be a guiding principle.

"Often, we just don't know where stuff is coming from," said Tara Norton, director of advisory services for the NGO Business for Social Responsibility.

Palm oil could prove even harder to trace than sugar. An estimated 85% of the world's supply of it is produced in Malaysia and Indonesia – much of it on remote plantations carved from rainforests in places like Borneo – which have few regulations and little transparency or accountability. As Sandra Seeboldt, Oxfam's palm expert, explained: "[In Indonesia], the government says it is all state land. To have real title to your land it is very complex. To most people, it is impossible." Brazil has similar title issues.

To add to the complexity, thousands of small-holders might grow palms on a few acres, said Adam Harrison, who monitors deforestation and palm oil for the World Wildlife Fund. All this adds up to a supply chain that's "nearly impossible to trace", he added.

Consumers' right to know

But while it's a difficult and complex task, it's also an important one. Ultimately, end users have a moral imperative to know where commodities come from and who's harmed in their acquisition, said Princeton University bioethics professor Peter Singer, author of The Ethics of What We Eat.

Buying unethically obtained commodities is akin to "buying stolen goods and then saying 'I didn't know they were stolen'. Claiming ignorance is no excuse", Singer said during a phone interview from Australia, where he also teaches at the University of Melbourne.

If big, well-known companies don't disclose where they obtain commodities, the public makes decisions based on ignorance, Singer said. "They see a [popular] brand and think that there's a state of ethical responsibility" that may not exist, he said. "They don't know that the sugar may come from a plantation where people were forcibly displaced."

Who's responsible?

Ending land grabs and other human rights abuses isn't the responsibility of companies like Coke and Pepsi alone; it will also require action from governments of commodity-producing countries, said Norton of Business for Social Responsibility in a phone interview from Paris.

"Agricultural products are at big risk of human rights violations. Companies have to engage with governments to make enforcement happen."

The best solution, according to Norton, is for governments to create and enforce a certification process throughout their supply chains (think USDA certified organic food). "I can't see any other way … to enforce [human rights] globally," she said.

And getting there would require the cooperation of governments and suppliers in some of the world's most remote regions, where far more than sugar is grown.

With so much money at stake in the developing world, that's unlikely to come easily. Indonesia exported palm oil worth $17.6bn in 2012, according to UN Comtrade data, and the palm oil industry is expected to grow 20% by 2020, according to Oxfam. That means an equal demand for more land, Seeboldt said.

Indonesia natives have been forced from common lands that have sustained them for centuries or longer, have been promised jobs that either didn't materialize or were short lived, and have even seen ancestral graves desecrated, according to a 2008 report – written by NGOs Friends of The Earth, LifeMosaic and Sawit Watch – about the human rights impacts of the nation's palm oil industry.

"It's hard to find vegetables or bushmeat nowadays," said the unidentified daughter of an Indonesian oil-palm farmer in a 2007 short film called "Palmed Off" on LifeMosiac's website. "There isn't any forest anymore. Everything has become palm oil. There is nothing else."

Legal measures

In Brazil, as in Indonesia and elsewhere, the lack of land titles and clear jurisdictions, there has been little action aimed at restoring Dos Santos and others to the Sirinhaem river delta.

After Oxfam's report late last year, a Pernambuco state prosecutor, Silvia Regina, announced an investigation and held public hearings to examine long-delayed appeals from the families to return to the river, according to reports. Since then, though, the investigation seems to have stalled.

"There hasn't been any movement on the case," said Simon Ticehurst, Oxfam's Brazil country director. "It is very complex. There are three claims to the land – national state and local and they keep hitting up against each other."

Regina couldn't be reached for comment.

Can corporate power pave a new path?

Despite the stalemate, Tichurst said he believes the policies announced by Coke and Pepsi could have a major impact on land rights. "It's early," he said. "We don't want them to stop buying. We think Brazil could be a model" for reform.

A local priest who's worked with the families during their 14 years of displacement, however, expressed doubt.

They were "expelled, evicted, persecuted. The majority of [them] have not been able to adapt to their forced change in lifestyle: health problems for the more elderly; drug problems for the younger people," Reverend Tiago Thorlby wrote in an email.

Some of those he called "fisherfolk" continue to work the river, but they are routinely harassed, Thorlby wrote, adding that he thinks little will change even after the "great hoo-ha" over the Oxfam report and announcements by Coke and Pepsi.

There is, he said, a "bloody taste in the sugar that can't be disguised".

Thomas Peele is an investigative journalist in California and the author of Killing the Messenger. Follow him on Twitter @thomas_peele.

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