Big buyers of palm oil may have adopted forest-friendly purchasing policies, but they appear still to have little control over their suppliers’ practices

Two years after a Greenpeace campaign led to big names in the palm oil industry agreeing to curb deforestation, and around 400 international members of the Consumer Goods Forum committed to zero-deforestation supply chains by 2020, pledges are going unfulfilled, and the rate of deforestation may be accelerating, particularly in Indonesia (see EthicsWatch, November 2015).

In a new report released this month, Greenpeace says a survey of 14 global consumer goods companies reveals that only two, Nestlé and Ferrero, the Italian manufacturer of Ferrero Rocher and Nutella, are making “significant headway” on removing deforestation from their palm oil supply chains. Of the others surveyed, Kellogg’s, Danone, Ikea, Mars, Orkla, Unilever, Procter & Gamble, Mondelez, and General Mills are making some progress, while three, Johnson & Johnson, Pepsi and Colgate Palmolive are “failing” to deliver on their promises.

Richard George, a forest campaigner for Greenpeace UK, says: “While there are very different degrees of progress, none of the companies can yet guarantee that their supply of palm oil is not linked to deforestation.”

Most of the companies surveyed are unable to say how much of their palm oil comes from suppliers that comply with their own sourcing standards. Until now, companies have been focusing on tracing the palm oil they buy to the mill and then to the plantation where it is grown. Now they need to start actively monitoring their suppliers for deforestation, peatland destruction, labour issues and social conflicts, George says, “and take swift action against persistent offenders. In the coming months, we expect all companies to publish a clear protocol for tackling suppliers that are unwilling to conform to these standards.”

Companies should consider hiring consultants to help them meet the goals they have set, George says. “However, we still expect all companies to obtain independent third-party verification to best-practice standards, such as those contained in the Palm Oil Innovation Group Charter, and report transparently on their progress.”

Greenpeace is seeking maps from Indonesian government officials so it can employ satellite technology to determine which companies are still destroying rainforests and where. The environmental group also wants a government moratorium on clearing forest and peatland areas and is encouraging supermarkets and food companies to stop trading with palm oil suppliers that continue these practices.

Palm oil plantations are the main cause of deforestation in Indonesia and Malaysia, where 85% of the world’s palm oil is produced. Besides contributing to the fight against climate change by sequestering CO2, rainforests in Indonesia are the main habit for endangered orangutans. Already, 80% of the habitat for orangutans has been damaged or lost, mainly as a result of human activity, and the remaining orangutans could be gone in as little as 25 years if deforestation continues at the current pace, Greenpeace says.

Some bright spots have emerged. Golden Agri-Resources (GAR), the world’s second largest palm oil plantation company, announced last month that it had completed mapping the 7m tonnes of palm oil in its supply chain back to 489 individual mills. It promised to announce a timetable in the next few months for tracing its supply chain back further, to individual plantations.

The Roundtable for Sustainable Palm Oil has launched a new, stricter palm oil label called RSPO Next, an add-on to the RSPO’s existing principles and criteria. Member companies that voluntarily exceed the current sustainable palm oil production requirements set by the RSPO can be granted the new status. To qualify for RSPO Next, growers must agree to no deforestation, fires, planting on peat, or use of the highly toxic herbicide paraquat and commit to enhanced transparency.

No company can guarantee its palm oil is deforestation-free

RSPO also says its GreenPalm certificate trading system will now certify traceability back to individual mills.

Last year a group of major companies and institutional investors urged the RSPO to strengthen its standards, saying they currently “do not include protections for peatlands or high carbon stock forests, and have an inconsistent record of enforcement”. Greenpeace says the new label falls short of adequately addressing deforestation, and criticized it for being voluntary.

Among other findings from the recent Greenpeace survey:

  • Only Ferrero can trace nearly 100% of its palm oil back to the plantation on which it is grown.

  • Most companies have yet to obtain independent third-party verification.

  • None publishes a full list of its palm oil suppliers, although some list top suppliers.

  • None publishes a list of suppliers that it has stopped buying from from as a result of its zero-deforestation policies.

Palm Oil  deforestation  Greenpeace  supply chains  agriculture  RSPO  EthicsWatch  innovation 

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