Mondelēz announces palm oil action plan: Non-compliant suppliers will be ‘eliminated’

A policy is meaningless unless it clearly defines what forest or land can and cannot be developed, says Greenpeace.

Mondelēz International has published a palm oil action plan promising to “prioritize” suppliers that meet its sustainability principles – something Greenpeace says is fundamentally flawed due to its definition of what a forest is.

The plan will require its suppliers to “achieve traceability” by the end of 2015, the confectionery giant announced at the Roundtable for Sustainable Palm Oil's (RSPO) European conference in London this week.

“The plan bolsters Mondelēz International's long-term commitment to only buy palm oil that's produced on legally held land; that doesn't lead to deforestation or loss of peat land; respects human rights, including land rights; and doesn't use forced or child labor. Mondelēz International plans to eliminate supplies that do not comply,” it said.

It said the plan - developed in consultation with the World Wildlife Fund (WWF) and the United Nations Development Programme (UNDP) - aimed to move sustainability into its commercial negotiations with suppliers. It will be reporting on progress annually, it added. 

Meanwhile, environmental NGO Greenpeace said the move was a sign of its and its supporters’ power to move big brands – having already moved consumer giants like P&G to begin cleaning their supply chains, the momentum for clean palm oil is undeniable”

However it said while Mondelēz’s new policy was part of this progress and it welcomed the commitment to remove suppliers that don't deliver, ultimately the initiative was flawed. 

Tristan Tremschnig, Greenpeace International's communications coordinator for Indonesian forests, said: "The major flaw in their policy is the way Mondelez defines 'forests' and essentially, how it does not spell out how to implement 'No Deforestation' in their supply chains. Without immediately adopting a definition of what a 'forest' is, it cannot demand what forest or land its suppliers can or cannot develop."

Greenpeace reservations

It said a High Carbon Stock approach (HCS) was already implemented by the likes of Golden Agri Resources, Wilmar, Asia Pulp & Paper and members of the Palm Oil Innovation Group. 

Tremschnig said: "By waiting to build consensus when others are already implementing accepted definitions of what constitutes forests - through the High Carbon Stock approach - Mondelez is taking the 'talk and log' approach. For Greenpeace, this is unacceptable and we believe Mondelez should immediately demand its suppliers stop the bulldozer while the HCS approach is implemented."

Responding to this, the confectioner's spokesperson Thomas Armitage, told us that the issue was addressed on page six of the plan with the statement that the company “urge[s] our suppliers and other stakeholders to reach consensus on definitions as soon as possible, so that we can align our criteria”.

The NGO also warned that policy on paper did not always translate into action. 

Challenging suppliers

Dave Brown, vice president of global commodities and strategic sourcing said sustainability should be universal and accessible to all. "So, rather than pursue a segregated supply from an existing pool of certified plantations, our priority has been to add momentum to efforts to transform the entire palm oil sector.  We're driving change to make sustainable palm oil a reality by embedding this policy into our commercial negotiations with suppliers." 

Mondelēz said the plan came after work with a number of stakeholders including WWF, UNDP and national governments, “as well as challenging its suppliers”. It said it conducted a survey last year to determine its suppliers’ ability to trace the raw material and added last year it achieved RSPO status for all of the palm oil it purchased, two years ahead of its own target. 

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