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Supply Chain
PepsiCo's New Palm Oil Commitment Is Major Improvement, But Other Companies Are Doing More

Last week, PepsiCo became the latest in a recent string of consumer packaged goods (CPG) giants — including Colgate-Palmolive, General Mills, Kellogg and Procter & Gamble — to announce a new “zero deforestation” palm oil sourcing commitment.

PepsiCo has committed to achieving zero deforestation in its company-owned and -operated activities and supply chain by 2020. Specifically, it says it will work to ensure that by 2016, all 450,000 tons of palm oil it sources each year will come only from suppliers certified by the Round Table on Sustainable Palm Oil (RSPO), do not develop on high carbon stock or high conservation value forests, or convert peatland into plantations.

But NGOs including Greenpeace and the Union of Concerned Scientists (UCS) find the company’s new policy a tad underwhelming.

“PepsiCo produces a lot more than soda,” said Calen May-Tobin, an analyst with UCS’s Tropical Forests and Climate Initiative. “Palm oil is in many of its products, from Quaker Oats to Grandma’s Homestyle cookies. PepsiCo’s announcement that it’s joining so many other companies in improving how it sources palm oil is good news, but it could do more to ensure that it is delivering on its promise.”

May-Tobin noted that while PepsiCo’s new commitment also protects peatlands, the commitment lacks explicit efforts to trace palm oil back to the source, ensuring that it is deforestation-free. Additionally, the commitment would be stronger if PepsiCo included independent verification of how suppliers are complying with their commitments.

"While PepsiCo's announcement includes measure that go beyond the RSPO, such as the protection of high carbon stock forests and all peatlands, it still lacks a strong commitment to full traceability, a demand for similar commitments from its suppliers and most importantly, an implementation plan," said Greenpeace USA forest campaigner, Joao Talocchi. "Consumer companies such as P&G, Unilever, and Nestle have already committed to policies that — if fully implemented — will guarantee their products will become free from deforestation. There's no reason PepsiCo can't follow suit."

Palm oil is used in everything from food and fuel to deodorant and cleaning agents. In many cases, new palm oil plantations displace tropical forests and peatlands, areas that store massive amount of carbon in the soil.

UCS recently scored the palm oil sourcing commitments for 30 consumer companies, including PepsiCo. The report found that the company’s previous deforestation efforts had demonstrated “little commitment” to procuring palm oil from deforestation-free sources. Its commitment at the time earned it a score of 33.7 out of 100. PepsiCo reports that it buys around 450,000 metric tons of palm oil annually for producing its snack food; UCS points out it takes an area roughly the size of New York City to produce that much palm oil.


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