The Palm Scribe

Mondelez to Require Better Traceability Across its Entire Palm Oil Supply Chain


Giant snack producer Mondelez International, Inc. is saying that starting in 2021, it will require enhanced traceability of its palm oil sourcing across its entire supply chain to help transform the palm oil industry and the zero-deforestation drive.

“We’re proud of our strong progress and from Q1 2021, we expect 80 percent of our palm oil to meet enhanced traceability and forest-monitored expectations,” said the company on its official website, adding that its new palm oil policy was unveiled early this month.

Mondelēz International which is known for global and local brands such as OREO, belVita, Cadbury Dairy Milk, Milka and Toblerone chocolate said that it was continuing to pioneer partnership and action with its suppliers to ensure they shared and actively supported not only the company’s commitment, but the larger collective commitment “to realize a forest positive future where palm oil is sustainably sourced across the sector.”

 “We have a unique opportunity to help create a future where sustainable practices are universal across the palm oil sector,” Quentin Roach, Chief Procurement Officer at Mendeles International said in a company release announcing the new palm oil policy.

The new requirements included traceability to plantation and satellite monitoring covering all palm oil concessions, supplying mills attributed to the company, against the deforestation criteria set out in its Palm Oil Action Plan. 

It said that all mills must be identified on Global Forest Watch, with no active grievances against concessions in their direct supply, or operated by the same producer groups elsewhere. In addition, suppliers must have third-party assurance of their monitoring process and systems used and be subject to cross-check by Mondelēz International.

The enhanced sourcing requirements also demanded that suppliers confirm sustainable sourcing practices across their entire supply chain by 2025, not just the portion supplied to Mondelēz International.

Mondelēz International represented around 0.5 percent of demand for palm oil, and thus recognized that all actors have a role to play in achieving a solution to the complex problem of attaining palm oil sustainability by supporting the transition to sustainable practices across the palm oil sector.  It sources palm oil predominantly from Malaysia and Indonesia.

The company said it has maintained 10 percent RSPO (Roundtable on Sustainable Palm Oil) palm oil coverage since 2018, 98% of the company’s palm oil comes from suppliers with aligned-to policies across their entire supply chain and the company takes action against groups who don’t comply, including the suspension of 89 mills in 2019.

“We are concerned about the potential negative long-term environmental and social impacts of palm oil production, including deforestation and human rights,” the company said, spelling out its principle for palm oil production for its suppliers to follow.

They were no deforestation with palm oil development not taking place in Primary Forest, High Conservation Value (HCV) areas, High Carbon Stock (HCS Approach) forests, or use fire in plantation operation, no development on Peat lands regardless of depth, no exploitation of workers or communities, respect human rights as well as land rights, no forced labor, no child labor, or gender-based discrimination.

“We expect our suppliers to adhere to these principles at the parent group level within their own company, as well as oversight of their suppliers’ adherence to these principles at parent group level. In addition to suppliers’ published policies, we also expect suppliers to demonstrate implementation, progress vis-a-vis the most updated version of our Palm Oil Action Plan. This is a prerequisite of doing business with us.” the company said.

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