Breakthrough on palm oil transparency to stop deforestation
Unilever continues to drive transparency across the palm oil sector, with a tougher stance taken against companies whose actions are linked to deforestation.
We believe that having a palm oil industry that is socially, economically and environmentally sustainable is possible and we have been fighting to make this a reality since the late 1990s.
We also believe that the most responsible approach is to work with our partners to help transform the industry from within. Our supplier partners can help us get closer to the people who grow the palm oil we purchase, which in turn helps us ensure it comes from sustainable sources.
Over the years, we have launched or joined a range of projects, collaborations and groups to improve the palm oil supply chain, and our efforts are currently focused on delivering full traceability by the end of 2019.
Our work has been about implementing our no deforestation palm oil policy with suppliers, driving RSPO certification, getting closer to the smallholder farmer and increasing traceability across the entire industry with our Universal Palm Oil Mill List.
Working with Aidenvironment, we have helped evolve its existing mapping platform – that pinpoints exactly where palm oil companies are operating – as well as its engagement processes. Specifically, we have been a strong partner in improving how information is gathered, shared and accessed, with suppliers now required to publish and regularly update data about the land they are using across their palm oil plantations. This has boosted the platform’s capabilities and, importantly, the value and impact of its output.
Wilmar International, the world’s largest palm oil trader and one of our strategic supplier partners, announced on December 10th, that it will start using – and pushing for wider adoption of – the enhanced platform. Wilmar will carry out an audit of all its suppliers by the end of January 2019, with those found to be driving forest loss facing immediate verification and, potentially, additional measures. The company will also use its existing satellite technology to monitor supplier farms, ensuring transparency and compliance.
When implemented successfully, this would put Wilmar International a step closer to eliminating deforestation from its supply chain and would have a major impact on the rest of the industry. The ambition is to extend the mapping platform to other suppliers in the industry.
To make wise, sustainable choices, as well as to hold companies to account, consumers need full visibility.Marc Engel, Chief Supply Chain Officer, Unilever
We have introduced a range of initiatives to address the need for greater transparency in the palm oil industry. For example, in February 2018, we became the first consumer goods company to publicly disclose the supplier partners and mills we source from, both directly and indirectly, and published our palm oil supplier partner list on our website.
As Priscillia Moulin, Head of Corporate Research at Aidenvironment Asia, describes it, “Over the past few years, many palm oil trader-refiners have worked very hard to implement their ‘No Deforestation, No Peat, No Exploitation’ (NDPE) policies. Yet sadly, because a fairly limited number of companies remain unwilling to comply – by lacking transparency, hiding behind opaque corporate structures and/or continuously clearing forest and opening up peatland – the whole industry suffers from an unduly negative image. This is why leading companies such as Wilmar and Unilever have committed to speed up actions regarding non-compliant suppliers.”
Unilever’s Chief Supply Chain Officer, Marc Engel, says: “To make wise, sustainable choices, as well as to hold companies to account, consumers need full visibility. They need to know where the products they buy come from, and how they were made. They need nothing less than radical transparency all the way up and down palm oil supply chains.”
This evolved mapping platform and processes will help businesses like Unilever better understand where we buy our palm oil from and how those companies comply with our NDPE procurement policy. This policy helps to drive impact because its scope applies to all of the buyers’ third-party suppliers and all the oil palm plantation operations undertaken by those suppliers, regardless of the individual mills that the buyers’ source from. The mapping database will enable suppliers’ land development activities to be monitored, using detailed forest cover and peatland baseline maps with high-resolution satellite imagery.
The information and insights that the platform is now capable of delivering will help allow companies to act more quickly – by triggering various next steps – if suppliers are found to be involved in deforestation and new peatland development. What’s more, suppliers who have been non-compliant in the past will have to submit recovery plans before re-entering the market.
Banning palm oil would most likely increase the production of other oil crops to meet demand for oil, displacing rather than halting the significant global biodiversity loss.International Union for Conservation of Nature
Palm oil production is a complex, controversial and often misunderstood vegetable oil and industry. But the problem is not the oil itself – it’s the bad practices that are sometimes used when cultivating it.
Palm oil is in fact the most land-efficient vegetable oil. Using an alternative would result in 8–10 times more agricultural land being devoted to non-food crops. A report by the International Union for Conservation of Nature (IUCN) this year highlighted this opinion, and WWF also states that boycotting palm oil is not the answer. The science also shows that a palm oil boycott would actually displace and not solve the problem, potentially making things worse.
It also delivers significant economic benefits to local producers. Globally, more than 3 million smallholder farmers make a living from palm oil. Switching to an alternative would imperil their livelihood and the wellbeing of their families.
A sustainable, responsible palm oil industry is possible, and Unilever has a legacy of strong and progressive leadership on this highly complex issue. This latest move with the mapping platform is another opportunity for us to use our scale to influence the wider transformative change necessary to make that ambition a reality.