Palm oil and its rising demand has been quite a controversial topic the past couple of decades due to its strong correlation to deforestation and poor history of regulation, especially in Malaysia and Indonesia, where 80 percent of the world’s supply is cultivated. In fact, the area of land used for palm oil cultivation has increased by 43 percent since the 1990s. Yet palm oil remains a staple for billions of people worldwide. Its uses are exceedingly diverse, ranging from food like margarine and ice cream to health products like shampoo and lotion. It’s not too surprising, then, that the palm oil industry is under tight scrutiny when it comes to sustainable practices and traceable supply chains.
Unilever has taken a step forward in the name of sustainable palm oil industry. One of the world’s largest buyers of palm oil with about 1.5 million tons purchased annually (or from another perspective, 3 percent of global production), Unilever is now also one of the world’s greenest buyers. The health and well-being conglomerate has announced it will reach its target of 100 percent certified sustainable palm oil covered by GreenPalm Certificates by the end of 2012, three years ahead of its original schedule. This success is in step with the company’s previous Good Agricultural Practice Guidelines for oil palm established in the mid-1990s as part of Unilever’s Sustainable Agriculture Program.
The GreenPalm Program, a certificate trading program designed to “tackle the environmental and social problems created by the production of palm oil” is open to all Roundtable on Sustainable Palm Oil (RSPO)-certified palm oil producers who register a quantity of their output. They are awarded one GreenPalm certificate for each ton of sustainably produced palm oil. These certificates can then be put up for sale on the GreenPalm web-based trading platform where manufacturers or retailers can bid for and buy them and be able to claim that they have supported the sustainable production of palm oil. Consumers can then make educated, environmentally responsible purchasing choices.
Among Unilever’s other commitments and sustainable actions:
- Became a founding member of the Roundtable on Sustainable Palm Oil (RSPO) in 2004 – a multi-stakeholder initiative set up in cooperation with WWF. The aim of the Roundtable is to move towards an industry-wide approach to sustainability in palm oil cultivation.
- Biggest single buyer of Green Palm certificates globally. Sixty-four percent of the company’s palm oil was purchased from sustainable sources, in the form of Green Palm certificates.
- Committed itself to buy all its palm oil from traceable sources by 2020, creating the capacity to trace every ounce of certified oil back to its home plantation.
- Currently in advanced discussions with the Indonesian government for investing over $130 million in a large processing plant for palm oil derivatives in Sumatra, leading to cutbacks on transport, less spending, and easier tracing of the sources of the palm oil used.
Unilever CEO Paul Polman said, “In a world where temperatures are rising, energy is costing more, sanitation is worsening and food supply is less secure, companies can no longer sit on the sidelines waiting for governments to take action. We have to see ourselves as part of the solution to these problems. In Unilever, we believe that our future success depends upon being able to decouple our growth from our environmental footprint, while at the same time increasing our positive social impacts.”
Take a look at Unilever’s short video on palm oil here.
Unilever’s 2011 Sustainable Living Plan Progress Report is available here.
Photo courtesy of Wikipedia.