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Mondelēz sets new palm oil supplier standards

16 Nov 2016

Mondelēz International has laid out new milestones and requirements for suppliers to work toward a sustainable supply of palm oil as part of its updated Palm Oil Action Plan - and will exclude those who don't comply.

Mondelēz International has laid out new milestones and requirements for suppliers to work toward a sustainable supply of palm oil as part of its updated Palm Oil Action Plan. The update is said to advance the company's goal to make sustainable palm oil the mainstream option, based on the principles that production should be on legally held land; not lead to deforestation or loss of peat land; respect human rights, including land rights; and not use forced or child labour.

The new plan builds on progress made since June 2014. As such, at the end of 2015, 90% of the palm oil sourced by the company was traceable to the mill, and 91% was purchased from suppliers with published policies that are aligned with Mondelēz International's principles.

Mondelēz International says it was the first multinational consumer goods company to require suppliers to track oil sourced from third-party suppliers as well as their own farms, and believes this was a critical step in catalyzing systemic change in sustainable palm oil.

"Our suppliers have done great work to align their policies and make their palm oil more traceable," said Walter Nobles, Vice President, Global Raw Materials. "But more is needed to drive real progress on the ground, so we're asking them to improve practices across their entire operations and engage their third-party suppliers — who supply much of the oil they trade — to implement the same practices.

"We'll exclude suppliers who don't immediately cease deforestation in their own concessions or exclude deforestation in their third-party supply."

Key new provisions in the updated plan require suppliers to map and assess the risk for all supplying mills on Global Forest Watch; provide assurance that no deforestation occurs on their own concessions and exclude third-party suppliers who do not immediately cease deforestation; and work with recognized third-party experts to protect labour rights

The updated palm oil action plan complements Mondelēz International's wider commitment to sustainably source key agricultural commodities. In 2013, the company achieved RSPO coverage for 100% of the palm oil it bought, two years ahead of its commitment.