Palm oil solutions: What should responsible businesses be doing?

Since global output reached close to 11 million metric tons in 1990, the ubiquitous problem of unsustainable palm oil production seems to have encapsulated most if not all of the ethical, social and environmental concerns surrounding global food production, resulting in significant media pressure and boycotts on palm oil-containing products and the companies who produce them…
 

Greenhouse gases

Millions of hectares of tropical rainforest have been destroyed in recent years, with devastating reports published by Greenpeace indicating that the process of clearing Indonesia’s forests to make way for oil plantations, followed by draining and burning the remaining peatlands, contributes around 4% of all global carbon emissions.

Exploitation

While palm oil production provides employment to many people in Southeast Asia, the industry has also has been linked to major human rights violations and cases of child labour, with communities in Indonesia and Malaysia reportedly finding themselves with no choice but to become plantation workers in poor and degrading conditions.

Destruction of wildlife

Large-scale deforestation also has huge implications for many native species, including tigers and orangutans, which are being pushed closer to extinction as their natural habitat is destroyed. According to the non-profit organisation Rainforest Rescue, “rainforest area the equivalent of 300 soccer fields is being destroyed every hour”. 

 

Indonesia’s tropical rainforests are among the world’s most diverse

Media pressure

Amongst news stories of SOS distress calls being carved into the green hills of Sumatra’s oil plains to highlight massive deforestation, to desperate pleas from indigenous communities calling for European nations to tighten oversight of supply chains, topped off with grim reports of murdered land activists, it comes as no surprise to read of Iceland becoming the first UK retailer to say “no” to palm oil in their own-brand products, reportedly eliminating 500 tonnes from their supply chain.

 

Is boycotting palm oil the answer?

While Iceland’s intentions have been widely praised, it will undoubtedly prove a difficult task, given that palm oil is found in approximately 68% of all packaged products, a figure that is likely to continue increasing given the growing need for affordable food.

Sourcing alternatives would also mean facing the hurdle of identifying palm oil that is listed under a common alias, such as:

  • Vegetable oil
  • Palm oil kernel
  • Palmitate
  • Margarine (highly likely to be derived from palm oil)
  • Cocoa butter equivalent (CBE)
  • Cocoa butter substitute (CBS)
  • Palm Olein
  • Palm Stearine

 

Vegetable oils are largely interchangeable, but boycotting palm oil may in fact prove to be less environmentally-friendly solution; less productive oil crops reportedly use ten times more land, meaning that sunflower, rapeseed or soybean oil may have a more negative environmental impact in the long term.

Rather than moving the problem elsewhere, it may be better to move things forward by having skin in the game. 

 

The role of retailers and manufacturers 

The issue is one of ownership, influence and responsibility. It is important for retailers and manufacturers to actively engage with supply chains in order to drive demand for palm oil which meets criteria sustainability criteria such as that outlined by the Roundtable on Sustainable Palm Oil.

However, the solution is far from simple. There are criticisms from environmental organisations such as Greenpeace who declare it “virtually impossible” to know whether or not a given supply of palm oil has been grown on deforested land, accusing organisations such as the RSPO of merely paying lip service to the protection of peatlands in order to justify the expanse of the palm oil industry.

In the face of these challenges, stakeholders who are closer to the consumer end of the supply chain have an important role to play in increasing collaboration and transparency within sustainable sourcing.

No more Nutella?

When Segolene Royal, France’s former Minister for Ecology, called for a boycott on Nutella due to its palm oil content, the nation’s favourite spread was saved by a comment from Greenpeace who commented that “a blanket boycott of this agricultural crop will not solve problems in its production”.

Rather than losing its place in shopping baskets across the country, Nutella’s parent company Ferrero was actively defended for being one of the more progressive consumer-facing companies with regards to its sustainable sourcing as a member of the Palm Oil Innovation Group with a robust and defensible palm oil policy.

What’s the advice for businesses?

According to the WWF, who produce a Palm Oil Scorecard for over 130 global brands, the advice for companies is as follows:

  • Join the RSPO
  • Calculate how much palm oil is in your products and where it is from
  • Be transparent
  • Make it clear to suppliers that only sustainable palm oil is expected

Understanding origins

In order for businesses to be confident that they are not complicit in the environmentally destructive practices which surround palm oil production, it is crucial to understand the origins of palm oil contained in their products and ensure that the necessary criteria are being met to guarantee responsible sourcing.

By leveraging technology to pinpoint the origins of palm oil supplies, monitor supplier compliance and share accurate information about palm oil content, fragile landscapes and their inhabitants could be safeguarded and palm oil production could be transformed into an example of bad business gone good.

The issue is massively complex and pervasive, with significant political complications, but whether the pendulum swings towards the reduction/elimination of palm oil use or an increase in transparency across sustainable supply chains, ignoring the problem is no longer an option for responsible businesses.

Posted by: Authenticate 04/05/2018