Supply Chain

Mars, J&J, P&G and a Dozen Other Consumer Brands Join Investors in Pressing RSPO for Stricter Standards

Today, institutional investors representing more than $4 trillion in assets are joining Mars, PepsiCo, Kellogg Company and a dozen other giants from the food/beverage and personal care industries to call on the Roundtable on Sustainable Palm Oil (RSPO) to strengthen its standards for certifying the sustainable production of palm oil. Palm oil is found in an estimated 50 percent of all packaged goods, from cosmetics to candy.

By Caitlin Kauffman | Published 9 years ago | About a 3 minute read

Today, institutional investors representing more than $4 trillion in assets are joining Mars, PepsiCo, Kellogg Company and a dozen other giants from the food/beverage and personal care industries to call on the Roundtable on Sustainable Palm Oil (RSPO) to strengthen its standards for certifying the sustainable production of palm oil. Palm oil is found in an estimated 50 percent of all packaged goods, from cosmetics to candy.

The companies and investors submitted a letter to the RSPO summarizing their recommendations today – just days before the group hosts its European Roundtable. The letter calls on RSPO to prohibit deforestation in palm oil supply chains and include additional environmental and human rights protections. In March, RSPO removed members that were not fulfilling basic membership obligations in an attempt to create a more transparent, environmentally sustainable and socially responsible palm oil industry, but dissatisfaction with the efficacy of the group’s standards remains.

The office of New York State Comptroller Thomas P. DiNapoli and Green Century Capital Management, an environmentally responsible mutual fund company, organized the letter.

“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. 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. We are, therefore, writing to urge the RSPO to strengthen its standards and practices to reflect best practices widely recognized as necessary to ensure palm oil is produced in a manner that does not degrade the environment or result in violations of human rights,” the letter reads.

It goes on to highlight specific concerns about critical externalities not taken into account by the RSPO. They cite High Carbon Stock forests and peatland expansions, as well as insufficient assurance that standards are being fully complied with. The letter also notes that many palm oil refiners and traders have voluntarily adapted their own standards that go beyond those of RSPO in the supply chain.

The complete list of signatories:

Mars, Inc
PepsiCo
The Procter & Gamble Company
Kao Corporation
Colgate-Palmolive
Johnson & Johnson Family of Consumer Companies
Starbucks
ConAgra
Dunkin’ Brands
The Kellogg Company
General Mills
Walmart
Albertsons-Safeway
Coop Switzerland
Seventh Generation

The letter makes the following recommendations:

Conduct an accelerated review of the P&C and related documents. The review should include recommendations leading to adoption and implementation in 2016 of the following requirements:

Conserve High Carbon Stock areas;
Protect peat, regardless of depth
Report on greenhouse gas emissions and reduction targets;
Ensure palm oil originates from known sources;
Strengthen transparency, auditing and enforcement among member companies:
Improve quality control measures for High Conservation Value and human rights assessments to ensure objective, rigorous auditing, verification and grievance processes. The fight against deforestation and for more sustainable palm oil has been a long and arduous one. Just last week, NGOs and investors voiced their dissatisfaction and concern about the lack of follow-through from companies including McDonald's and Bunge Limited on deforestation commitments.