The TFT Palm Oil Journey

5 December 2013: Wilmar, Asia’s largest agribusiness company, announces its commitment to No deforestation, No Exploitation and No Peat. The company controls 45% of the global palm oil trade, one of the most environmentally intensive commodities on earth.


What does this declaration mean? And how did we get here?

2010: Nestlé has a problem. Greenpeace has just launched a graphic video campaign linking the palm oil in Nestlé’s KitKat to the destruction of rainforests.

At Nestlé there is a shock. This doesn’t align with how the company sees itself and its values.

Nestlé wants to take the lead.

TFT’s Scott Poynton explains how Nestlé reacted to the Greenpeace investigation

TFT begins working alongside Nestlé to bring about change in its global supply chain, developing a vision of a palm oil industry free of deforestation and human exploitation.

The change process is fuelled by Nestlé’s inner values, not by external rules or standards. The company owns its policies and doesn’t depend on anyone else to make it happen. It creates its own story about what it wants for its products.

 

Transparency – How to go about it?

“The question was not should we do or not do, the question was how we go about it.”
Marco Gonçalves, Nestlé Chief Procurement Officer

 

To lead change, Nestlé now has to find out what is happening in its supply chain – all the way back to the palm oil plantation.

Transparency allows Nestlé to understand the impacts of its supply chains on people and nature.

It also creates trust. By being open with NGOs about issues and progress in its supply chain, these stakeholders become Nestlé’s allies rather than their enemies.


2011: Transformation – Innovating away from deforestation and exploitation

Nestlé’s engagement leads some of its suppliers to make their own commitments, innovating in the field.

Golden Agri-Resources (GAR), the world’s second largest palm oil producer, announces the most far-reaching sustainability policy of any palm oil company to date.

Peter Heng on working with Greenpeace and TFT

 

2012: Transformation – Innovating for the environment

TFT, Greenpeace and Golden Agri-Resources (GAR) develop a ground-breaking methodology to change the way land is chosen for palm oil development.

Some forests and peatlands store higher levels of carbon than others, and if cut, emit far greater amounts of carbon into the atmosphere. Using the latest science, satellite technology and precise measurements in the field, such land can be classified and protected from development as High Carbon Stock (HCS), across GAR operations.

“The global market is increasingly demanding No Deforestation palm oil. Only those companies who deal with the High Carbon Stock issue will be able to meet this demand. This is a challenge not only for Indonesia, but for the entire palm oil industry.”
Scott Poynton, TFT

 

2013: Transformation – Innovating for people

Golden Verloeum Liberia (GVL) partners with TFT to engage with local communities in West Africa.

Some of the most complex challenges in the transformation process are the social issues. Palm oil has as big effect on people as it does on the environment. Issues include exploitation of workers and land grabbing from local communities.

TFT is working with Wilmar, GAR, GVL and many others to ease the tension between companies, workers and communities. Free, Prior and Informed Consent (FPIC) initiatives are implemented to ensure that the rights of the community are respected and that communities have a say in issues affecting them.

The journey continues

“The main difference this whole experience has made: we are really changing things on the ground, we are improving things.”
Marco Gonçalves, Nestlé Chief Procurement Officer

Colgate-Palmolive and Groupe Rocher are among the latest to join Nestlé, Ferrero, ADM, Mars, Cargill, Danone and others leading the transformation of the palm oil industry.

Each company follows its own values and policies, but all are converging towards palm oil without deforestation and exploitation. They are flying and innovating freely, but fundamentally in the same direction.

We believe this is an emerging movement creating a pathway for change extending beyond palm oil into all commodity markets.