3. Financial investment via the cooperative management fee Partner cooperatives play a central role in enabling the 5 Sourcing Principles on the ground. Specifically, they are responsible for: • Enabling a member-led, community-centred approach to implementing our shared programmes • Implementing and operating BeanTracker, our proprietary software for tracking and tracing beans from farm to processor • Implementing and operating our approach to the Child Labour Monitoring and Remediation System (CLMRS) • Ensuring premium payments are distributed to cocoa farmers • Implementing activities related to the productivity programme, including farmer coaching Building out these systems requires ongoing technical and financial investment beyond the first couple of months of onboarding. In addition to funding for the initial start-up costs required to set up BeanTracker and the CLMRS, Tony’s Open Chain Mission Allies pay a cooperative management fee (defined as an amount per metric ton of cocoa) to fund further development of the partner cooperatives’ business models and day-to-day operationalisation of programmes. In total, Tony’s Open Chain has invested more than €3. 9 million in cooperative management fees since its founding in 2019. This fee is a vital investment in the cooperative business model, helping cover operational costs and enabling long-term development. Such investments are becoming increasingly important in the context of rising administrative costs under emerging due diligence legislation. Companies must take financial responsibility for implementing these compliance requirements, rather than passing the burden down the supply chain. Partner cooperatives that are in their Initial Collaboration Agreement or in their first MoU often use the funds to cover the ongoing costs of implementing the 5 Sourcing Principles (e.g., salaries, insurance, equipment maintenance). Partner cooperatives in their second and subsequent MoUs typically invest in expanding their membership to scale their impact, or strengthening their operations (such as by building warehouses, purchasing trucks for bean transport, or developing additional income generating activities for the cooperative). This evolution is possible because, as we grow the cocoa volumes sourced with each partner cooperative over time, the corresponding cooperative management fee also grows and can be invested more strategically. The allocation of the cooperative management fee is determined collaboratively by the partner cooperative and Tony’s Open Chain, as part of the annual activity planning process and ongoing evaluations. Ultimately, the cooperative fee is designed to foster independence, strengthen systems and drive innovation across all partner cooperatives.
Investing in enabling environments With funding from the Chocolonely Foundation and other external partners, we also invest in building enabling environments that support the strengthening of wellbeing and resilience in partner cooperatives’ communities. Key focus areas include investments in infrastructure, healthcare and education, for example through building accessible schools, healthcare facilities, and clean water sources.
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