Unilever implements ‘radical step’ on palm oil traceability

Unilever has become the first consumer goods firm to publicly disclose palm oil suppliers and mills that it sources from, both directly and indirectly, a move described by the firm as a "major milestone" in driving sustainability through the industry.

The extensive mapping exercise covers more than 1,400 mills and more than 300 direct suppliers. Whereas companies are able to map palm oil sources as it enters the supply chain, the fruit has to first pass through plantations, middle men and agents before entering mills. Unilever is still committing to “complete transparency” of this particular supply chain.

Unilever’s chief supply chain officer, Marc Engel, said: “We have been long committed to lead the drive towards transparency and the best way to demonstrate this is by opening up our own supply chain. Due to traditional commercial sensitivities and the complexity of the palm oil supply chain, it has required perseverance to get to where we are now.

“We are very proud to be the first consumer goods company to take this step. Unilever believes that complete transparency is needed for radical transformation. We want this step to be the start of a new industry-wide movement.”

Unilever first launched its Sustainable Palm Oil Policy in 2013, with the aim of achieving a fully-traceable supply chain. The latest announcement was described by the firm as a “radical step” in tracing an industry that is notoriously difficult to map and is constantly linked to acts of deforestation.

Alongside Pepsico and Nestlé, Unilever was accused of complicity in the destruction of Sumatra’s last tract of rainforest. In that case, the palm oil reached major brands via a twisting supply chain that stretches from the PT Agra Bumi Niaga (ABN) logging company, which delivers to a processing mill owned by PT Ensem Sawita (ES).

Last year, Unilever suspended sourcing from an Indonesian-based palm oil supplier which was found to be in breach of policy on deforestation and peatland clearance. In fact, Unilever is known to work with companies to help them improve sourcing standards. It is a founding member of the Roundtable on Sustainable Palm Oil.

“A lot of people think if you outsource your value chain you can outsource your responsibilities. I don’t think so,” Unilever’s chief executive Paul Polman added. “We need to be at the forefront of change. This is why Unilever is committed to greater transparency and continue to work with our partners to drive positive change in the palm oil industry.”

Matt Mace

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