PepsiCo on track for palm oil goals despite NGO concerns

PepsiCo has released an updated sourcing policy in a bid to source 100% certified sustainable palm oil by 2020, a move that the Rainforest Action Network has described as a "dodge and cover" action plan.

PepsiCo released its updated progress report last week, outlining progress against ambitions to source 100% Roundtable on Sustainable Palm Oil (RSPO) certified sustainable palm oil by 2020. According to the company’s 2017 Palm Oil Progress Report, 32% of this target has been achieved.

The food and beverage giant notes that it is “on track” to reach 50% certified sourcing by the end of the year, while supply chain traceability to mill reached 94% at the end of 2017. In 2016, PepsiCo bought approximately 480,000 tonnes of palm oil globally.

“Our latest Progress Report and expanded policy reinforce our commitment to transparency regarding palm oil as we make progress towards our 2020 goals,” PepsiCo’s sustainability director Rob Meyers said.

“They reinforce PepsiCo’s multi-year objective of playing our part, alongside our peers, partners and producers, in the long-term transformation of the palm oil industry.”

The updated policy outlines long-term visions and commitments covering no deforestation, no developments on peatlands and no exploitation of indigenous peoples and local communities. Notably, PepsiCo has announced it will not purchase palm oil from land that has been cleared since the end of 2015.

Dodge and cover

However, US-based conservational organisation Rainforest Action Network (RAN) claimed that the updated policy failed to close loopholes that enabled palm oil companies linked to deforestation to “continue business as usual”.

RAN’s main concerns are linked to Indonesian firm Indofood and its subsidiary IndoAgri. In 2018, an RSPO certification auditor released a report linking IndoAgri to alleged cases of labour abuse and legal violations. Earlier this year, PepsiCo suspended sourcing contracts from the firm, but some outlets note that the company has maintained a joint venture with supplier’s parent company “without consequence”.

“This policy is a dodge and cover,” RAN’s palm oil campaign director Robin Averbeck said. “At the end of the day it still allows PepsiCo to remain in business partnership with companies actively abusing workers’ rights and destroying tropical rainforests and peatlands.”

“We are not asking for the impossible, PepsiCo has the ability and responsibility to meet the demands of global consumers to protect workers rights, eliminate deforestation and peatland destruction. PepsiCo needs to close the loophole that allows its partner Indofood to continue business as usual.”

PepsiCo clarified to edie that IndoAgri had been the “subject of separate complaints relating to deforestation and social/land conflicts” but its not a direct supplier to the company. The food and beverage giant also noted that a joint venture is in place with Indofood to make some products based in Indonesia.

As part of PepsiCo’s ongoing supplier engagement process, the company has worked with Indofood and IndoAgri on the specific allegations and potential steps to help progression, as noted by a policy briefing from January 2018.

Matt Mace

Action inspires action. Stay ahead of the curve with sustainability and energy newsletters from edie