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Supply Chain
Stakeholders Continue, with Mixed Success, to Push Brands on Contentious Ingredients

This week has seen another concerted push by concerned stakeholders to clean up major brands’ supply chains.

On Tuesday, for the second time in a month, hundreds of activists once again took part in a Week of Action in grocery stores and public spaces across the United States, rebranding grocery store shelves and engaging shoppers to warn them that products from PepsiCo’s Quaker brand may contain Conflict Palm Oil.

“Palm oil is in everything from the food we eat to the shampoo we use. It's practically inescapable, and irresponsibly produced Conflict Palm Oil is affecting our world in a very negative way,” said Lindsay Vanderhoogt, a 24-year-old activist leading an action in Boston.

The Week of Action marks the two-year anniversary of a campaign to pressure PepsiCo, the world’s largest globally distributed snack-food company, to cut Conflict Palm Oil from its supply chain.

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PepsiCo is one of the “Snack Food 20” group of companies targeted by Rainforest Action Network’s Conflict Palm Oil campaign. The snack giant consumes more than 450,000 metric tons of palm oil annually for brands such as Quaker, Doritos and others in the U.S., Mexico, Latin America, Asia and Europe, and its consumption of palm oil is reportedly on the rise.

“PepsiCo is starting to take these issues seriously, but it is lagging behind its peers as it lacks a truly responsible palm oil policy. The requirements it currently has in place have critical gaps that must be addressed before PepsiCo can meet the new global benchmark for responsible palm oil procurement,” said Gemma Tillack, Agribusiness Campaign Director for Rainforest Action Network. “For PepsiCo to meet consumer expectations, it must adopt a binding, time-bound policy with an action plan that includes full traceability of palm oil back to its source and verifiable safeguards for human rights, forests and peatlands.”

Also on Tuesday, McDonald's, having faced similar criticisms on its palm oil practice from stakeholders, pledged this week to eliminate deforestation from its global supply chains, making it the first global fast food chain to do so.

The Union of Concerned Scientists (UCS) — which recently gave McDonald’s 24.4/100 on its 2015 Palm Oil Scorecard, (an increase of 3.3 point over its 2014 score) — commended the announcement, which it says goes well beyond the deforestation-free palm oil commitments other fast food companies have made. By aiming to eradicate deforestation from all commodities, McDonald’s is initially focusing on the sourcing of deforestation-free beef, fiber-based packaging, coffee, poultry and palm oil. But until McDonald’s releases the details of the individual commodity commitments, UCS says the effectiveness of its pledge cannot be determined.

“The sheer scale of McDonald’s commitment includes significant potential for change, pushing the industry to implement new environmental standards across the board and ultimately reducing climate emissions,” said Lael Goodman, analyst with Union of Concerned Scientists’ Tropical Forest and Climate Initiative. “However, the commitment is still a work in progress. To force real change, McDonald’s must demonstrate real action in the form of strong individual commodity commitments and on the ground follow through.”

UCS says McDonald’s’ biggest challenge will be to make sure its palm oil comes from sustainable land and cut deforestation from its supply chain. The fast food giant must also put earlier, time-bound goals on all stages of the pledge, from those for individual commodity commitments to the company’s overall global supply chains.

“McDonald’s announcement has the potential to create a ‘new normal,’ where fast food brands sourcing forest-produced commodities demand deforestation-free products,” said Goodman. “While the details of this commitment have yet to be seen, the company is sending a powerful signal that it wants to reduce its environmental footprint.”

Meanwhile, on Friday, shareholders will plead with Abbott Laboratories (maker of Similac baby formula), for the third year in a row, to reveal which of its products contain genetically modified organisms (GMOs), and to take action to reduce or eliminate them, in a resolution once again filed by shareholder advocacy organization As You Sow.

“Abbott has serious transparency issues around the ingredients it sources,” said As You Sow CEO Andrew Behar. “The vast majority of GMOs are engineered to sell more pesticides, and pesticide overuse is causing major environmental problems. Consumers associate Abbott brands with environmental problems, and this is a material risk to investors.”

As You Sow published a memo in support of the resolution, noting that 93 percent of Americans favor GMO labeling and 64 countries label or ban GMOs, including the European Union. Vermont passed a GMO labeling law in 2014 taking effect in 2016, and counties in Hawaii and Oregon have banned the cultivation of GMO crops.

“In an age where a viral social media post can substantially impact a business’ bottom line, smart companies are decreasing their reputational risk by taking steps to avoid contributing to social or environmental problems,” said Austin Wilson, Environmental Health Program Manager at As You Sow. “This proposal calls for transparency about Abbot’s risk exposure, and asks what they’re doing to address it.”

Responding to market preferences, many major brands have already removed GMOs from their products, including General MillsOriginal Cheerios, Post’s Grape Nuts, Hershey’s Kisses and all of Ben & Jerry’s ice cream flavors. Whole Foods Market says it will label all food in its stores for GMOs by 2018.


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