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Supply Chain
Hershey Updates Palm Oil Policy to Address Stakeholder Concerns

The Hershey Company has announced a new palm oil sourcing policy that updates and strengthens its commitment to source 100 percent traceable and responsible palm oil, a commitment the company announced in December 2013.

The comprehensive sourcing policy details the requirements to which all suppliers in the company’s palm oil supply chain will be held accountable. In addition to provisions that protect against deforestation, preserve native species’ habitats and protect the environment, the new sourcing policy also provides details on labor and human rights protections and the inclusion of smallholder palm farmers in the supply chain.

To help trace its palm oil supply chain and safeguard supplier adherence to the company’s new palm oil sourcing policy, Hershey has become a member of The Forest Trust (TFT). TFT will bring an important perspective and expertise to review and evaluate the Hershey palm oil supply chain and help the company make adjustments to achieve its progressive objectives. TFT is a global non-profit organization that works with companies to help transform the way they source their products.

Hershey says it is working towards establishing the best path forward to a sustained, traceable, responsible palm oil supply chain, and expects to achieve traceability to the mill level by first quarter 2015. From there, the company will use this information to assess which suppliers present the highest risk for engaging in deforestation. Hershey will require that these suppliers commit to implementing responsible expansion procedures to the plantation level in 2016.

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Hershey spent the first half of 2014 meeting and talking with many stakeholders across the palm oil supply chain, including commodities companies, plantation owners, non-profit groups and non-governmental organizations to fully understand the complex range of concerns and issues affecting the industry. The new policy reflects a synthesis of many stakeholders’ points of view and addresses the most important concerns in palm oil sourcing.

As it makes progress on the supply chain front, Hershey is also making steady strides to reduce waste. In March, the company surpassed its water consumption target three years early and its zero waste to landfill (ZWL) and recycling targets two years early. By the end of 2013, Hershey said it had converted six of its manufacturing facilities to ZWL, surpassing its 2015 goal of five; achieved a recycling rate of 86.6 percent, beating its 2015 goal of 85 percent; and reduced water consumption per pound of product by 58 percent by the end of 2012, far exceeding its 2015 goal of 10 percent.

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