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Companies call for tougher sustainability standards for palm oil Companies call for tougher sustainability standards for palm oil
(about 11 hours later)
Businesses are often urged to adhere to tougher green standards. But on Monday, 16 companies rallied together with investors and NGOs to call for more oversight for palm oil production, which is a huge contributor to deforestation.Businesses are often urged to adhere to tougher green standards. But on Monday, 16 companies rallied together with investors and NGOs to call for more oversight for palm oil production, which is a huge contributor to deforestation.
Big-name companies such as food and beverage multinational PepsiCo, retail giant Walmart and coffee chain Starbucks, as well as numerous investors and NGOs, signed a letter, released Monday, urging the Roundtable on Sustainable Palm Oil (RSPO) to enforce stricter standards.Big-name companies such as food and beverage multinational PepsiCo, retail giant Walmart and coffee chain Starbucks, as well as numerous investors and NGOs, signed a letter, released Monday, urging the Roundtable on Sustainable Palm Oil (RSPO) to enforce stricter standards.
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“As an international certification scheme, the RSPO is uniquely positioned to support, promote, and enforce the widespread uptake of responsible and sustainable production practices across the palm oil industry,” the letter states. “Given current shortcomings of RSPO certification, however, purchasing RSPO Certified Sustainable Palm Oil (CSPO) does not sufficiently address critical sustainability concerns in the palm oil supply chain.”“As an international certification scheme, the RSPO is uniquely positioned to support, promote, and enforce the widespread uptake of responsible and sustainable production practices across the palm oil industry,” the letter states. “Given current shortcomings of RSPO certification, however, purchasing RSPO Certified Sustainable Palm Oil (CSPO) does not sufficiently address critical sustainability concerns in the palm oil supply chain.”
Palm oil is the cheapest vegetable oil on the market, and is used in approximately 50% of consumer goods from cosmetics to packaged foods. Imports to the United States have jumped 485% in the past decade, and this increased demand has led to the rampant destruction of rainforests and the displacement of local communities to make way for palm oil plantations, primarily in Indonesia and Malaysia. Most worryingly, by razing rainforests to farm the oil, companies are releasing dangerous quantities of greenhouse gas emissions into the atmosphere, making palm oil production a big contributor to climate change.Palm oil is the cheapest vegetable oil on the market, and is used in approximately 50% of consumer goods from cosmetics to packaged foods. Imports to the United States have jumped 485% in the past decade, and this increased demand has led to the rampant destruction of rainforests and the displacement of local communities to make way for palm oil plantations, primarily in Indonesia and Malaysia. Most worryingly, by razing rainforests to farm the oil, companies are releasing dangerous quantities of greenhouse gas emissions into the atmosphere, making palm oil production a big contributor to climate change.
According to the letter, the RSPO isn’t doing enough to curb deforestation or to ensure companies are complying with its standards. As a result, those businesses concerned about the environment – as well as their reputations – have been forced to adopt their own sourcing standards. Five of the top 10 corporate purchasers of palm oil – including Colgate-Palmolive and Johnson & Johnson – have gone beyond the RSPO and created their own sourcing policies.According to the letter, the RSPO isn’t doing enough to curb deforestation or to ensure companies are complying with its standards. As a result, those businesses concerned about the environment – as well as their reputations – have been forced to adopt their own sourcing standards. Five of the top 10 corporate purchasers of palm oil – including Colgate-Palmolive and Johnson & Johnson – have gone beyond the RSPO and created their own sourcing policies.
“The RSPO have been left behind,” said Mark Mills, partner at Generation Investment Management, a London-based investment management firm focused on sustainability and a member of UN Principles of Responsible Investment palm oil working group, during a conference call Monday.“The RSPO have been left behind,” said Mark Mills, partner at Generation Investment Management, a London-based investment management firm focused on sustainability and a member of UN Principles of Responsible Investment palm oil working group, during a conference call Monday.
In the letter, companies and investors, along with nonprofit sustainability advocacy group Ceres, ask the RSPO to do more to conserve so-called “high carbon stock areas” – typically rainforests that hold large stores of carbon – and protect carbon-rich organic soils known as peatlands.In the letter, companies and investors, along with nonprofit sustainability advocacy group Ceres, ask the RSPO to do more to conserve so-called “high carbon stock areas” – typically rainforests that hold large stores of carbon – and protect carbon-rich organic soils known as peatlands.
“Currently, [RSPO] standards do not require its members to protect peatlands as a criteria for producing palm oil sustainably, so we are urging the RSPO to explicitly prohibit the clearing of peatlands as a condition for growers companies to claim that their palm oil has been sustainably produced,” said Lucia von Reusner, shareholder advocate at environmentally responsible mutual fund company Green Century Capital Management, which helped spearhead the letter.“Currently, [RSPO] standards do not require its members to protect peatlands as a criteria for producing palm oil sustainably, so we are urging the RSPO to explicitly prohibit the clearing of peatlands as a condition for growers companies to claim that their palm oil has been sustainably produced,” said Lucia von Reusner, shareholder advocate at environmentally responsible mutual fund company Green Century Capital Management, which helped spearhead the letter.
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Other actions include reporting on greenhouse gas emissions and reduction targets and ensuring palm oil originates from known sources.Other actions include reporting on greenhouse gas emissions and reduction targets and ensuring palm oil originates from known sources.
“I think it’s important to emphasize that this initiative should be seen less as a criticism than as a constructive attempt to strengthen standards and enforcement,” said Pat Doherty, corporate governance director of New York State Comptroller Thomas P DiNapoli, during the conference call. The Comptroller’s office is the sole trustee of the $177bn New York State Common Retirement Fund, which in recent years has pushed companies in its portfolio to source palm oil more sustainably.“I think it’s important to emphasize that this initiative should be seen less as a criticism than as a constructive attempt to strengthen standards and enforcement,” said Pat Doherty, corporate governance director of New York State Comptroller Thomas P DiNapoli, during the conference call. The Comptroller’s office is the sole trustee of the $177bn New York State Common Retirement Fund, which in recent years has pushed companies in its portfolio to source palm oil more sustainably.
“Considering that RSPO remains in our estimation an indispensable organization, it’s therefore especially important they implement a higher standard of protection of human rights,” he said.“Considering that RSPO remains in our estimation an indispensable organization, it’s therefore especially important they implement a higher standard of protection of human rights,” he said.
The palm oil debate is funded by the Roundtable on Sustainable Palm Oil. All content is editorially independent except for pieces labelled advertisement feature. Find out more here. RSPO responded to the letter with a press statement: “The RSPO acknowledges the importance of the issues raised by some institutional investors and industry players in the recent letter published by Ceres. It is encouraging to see that more and more actors today are willing to play an active role in moving towards a sustainable palm oil supply chain, and share RSPO’s vision of making sustainable palm oil the norm. We are, and will continue taking all constructive comments on board. We are confident that with a commitment to continuous improvement and with the support of all committed players we will be able to truly achieve our vision of market transformation.”