Multinational pledges to ensure that the palm oil and palm kernel oil it sources is traceable to the supplier mills

Procter & Gamble has bowed to pressure from environmentalists and revealed a new, extensive no-deforestation policy in the production of its products, including demanding fully traceable palm oil from suppliers.



In the wake of severe criticism by a Greenpeace report earlier this year, the multinational company said on Wednesday that by the end of 2015 it would ensure that the palm oil and palm kernel oil it sources is traceable to the supplier mills.

It also pledged to ensure no deforestation is involved anywhere along the supply chain by 2020.

“P&G’s commitment to no deforestation in its palm supply chain is unequivocal,” said Len Sauers, P&G vice-president of global sustainability.

“Our aim is to develop effective long-term solutions to the complicated issue of palm oil sustainability. We are committed to driving positive change throughout the entire supply chain, not just for us, but for the industry and for the small farmers who depend on this crop.”

The Greenpeace report detailed links between the multinational company and palm oil suppliers in Indonesia which allegedly engaged in destructive deforestation, clearing of endangered animal habitat and potentially illegal forest fires. Palm oil is believed to be the single biggest driver behind deforestation in Indonesia.

“As a result of rainforest destruction by Procter & Gamble’s suppliers, household brands containing palm oil, such as Head & Shoulders shampoo and Gillette shaving gel, are contributing to climate change, key tropical biodiversity loss and social deprivation,” the Greenpeace report said.

Less than 10% of the palm oil used by the company was certified sustainably sourced, Greenpeace said. On Tuesday the multinational company announced its commitment to a “no-deforestation policy” in its palm oil supply chain, but on Wednesday the company also pledged to provide annual updates of its own progress and to promote consistent sustainable practices and standards across the industry.

The policy appears to go further than the assurances made at the time of Greenpeace’s report, that it would have 100% sustainably purchased palm and palm kernel oil by 2015, and 100% recycled or third-party certified paper products by 2020.

This new commitment also goes further than the current industry goals set through the Roundtable on Sustainable Palm Oil (RSPO). The RSPO aims for 100% sustainable palm oil by 2015, although many signatories are falling well short of that target. P&G claims to have met this goal already. There are also a number of levels of sustainability within the RSPO, as well as trading certificates to assist companies reach sustainability on paper.

“P&G's policy is testimony to the transformation that the palm oil industry is currently undergoing: from consumers demanding deforestation-free products, to traders and producers such as Wilmar and GAR adopting no-deforestation policies: responsible palm oil is fast becoming the norm,” said Areeba Hamid, a Greenpeace International forest campaigner.

The environmental organisation said the new policy is a sign of an attitude change within the industry and a step towards ending deforestation and is a result of intense campaigning by protesters, but it wants P&G to go further.

“The policy is not perfect. It leaves suppliers six more years to clear forests,” said Hamid, urging the company to take immediate action against suppliers identified to be clearing forests and peatlands.

“Also for P&G to guarantee that all its products are completely free from forest destruction, it would need to implement a similar no-deforestation commitment across forest commodities, that it sources apart, such as wood pulp.”