Our approach to sustainable sourcing
We're working with farmers and suppliers to drive up social and environmental standards in our supply of agricultural raw materials.
The raw materials that make brands loved by billions
People a day use a Unilever product
Around 2.5 billion people a day use a Unilever product – and we use raw materials from around the world to make them.
Many of the raw materials we use in our brands come from farms and forests. That means we need a secure, sustainable supply of these materials for the future growth of our business. At the same time, our agricultural supply chain connects us to millions of people, which creates a pathway to realise many of our ambitions for positive social impact. That's why our commitment to sustainable sourcing, underpinned by our Sustainable Agriculture Programme, is a crucial part of our Unilever Sustainable Living Plan.
Our Sustainable Agriculture Programme
Our Sustainable Agriculture Programme was inspired by our ambition to buy our agricultural raw materials from farms applying sustainable agricultural practices – growing crops in ways which sustain the soil, minimise water and fertiliser use, protect biodiversity and enhance farmers’ livelihoods.
At the heart of the programme is our Sustainable Agriculture Code (SAC). We developed the Code to give us and our farmers and suppliers a set of rigorous standards which would spur on improvements across our supply chain.
The Code defines what sustainable sourcing means in practice, using 11 social, economic and environmental indicators: soil health, soil loss, nutrients, pest management, biodiversity, farm economics, energy, water, social and human capital, local economy and animal welfare.
We’ve been working with our suppliers to help them comply with our SAC since 2010. To make the greatest progress as fast as possible, we’ve focused our efforts on a priority set of key crops and commodities, chosen for their importance to our business and our brands as well as our ability to have a greater positive impact within these agricultural sectors. These priorities include palm oil, paper and board, soy, sugar, tea, dairy, rapeseed, cereals, vegetables, cocoa, herbal infusions and vanilla.
Driving positive change throughout our supply chain
We want to drive sustainability throughout our supply chain. In this Report (our Sustainable Living Report), we describe how we’ve reviewed our strategy and evolved our approach to sustainable sourcing. We cover our commitments and progress on palm oil and tea, paper and board, soy and rapeseed oils, vegetables, cocoa, sugar and dairy. We also set out how we protect biodiversity as a core element of our approach.
But our Sustainable Living Report aims to give a wider view, too. Given the reach and scale of our supply chain, we are exploring how we can have positive impacts on sustainable agriculture that go beyond our SAC. Transforming global food systems describes how we’re working to achieve the transformational changes that will further improve the lives of farmers, the productivity of their farms, and the resilience of our supply chains. And in Connecting with smallholder farmers we describe how many of our sourcing initiatives aim to boost smallholders’ incomes and achieve other social impacts alongside fostering sustainable agricultural practices.
Making sure we address the biggest issues
We reviewed our sustainable sourcing strategy over 2016–2017 to ensure it continues to have the greatest possible impact on the ground while supporting our business by building trust and addressing risk in our supply chain. One of the outcomes of this review was the revision of our Sustainable Agriculture Code.
Our Sustainable Agriculture Code
In 2017, we updated our Sustainable Agriculture Code (PDF | 2MB) (SAC 2017) to raise our standards further by emphasising five key areas:
- no deforestation
- human rights (including Free, Prior and Informed Consent)
- legal compliance
- migrant labour, and
- grievance processes for workers.
We are moving the programme from self-assessment to third-party certification, to provide greater trust and transparency and ensure more accurate reporting. The SAC continues to recognise external certification (such as Rainforest Alliance certification) that meets or exceeds our own standards.
We require our suppliers to comply with our Responsible Sourcing Policy (PDF | 9MB) (RSP). The updated SAC includes a chapter dedicated to the RSP for farms. It also includes requirements addressing land use change and deforestation, specific areas of health and safety, sustainable production of livestock feed and land rights protection. It extends animal welfare provision to transportation and slaughter.
In 2018, we set out to certify an initial 40 suppliers against SAC 2017. We selected these suppliers to ensure a representative variety of our crops and geographies. Feedback showed they welcomed the more intensive interaction with the auditor during the certification process, and the opportunity to improve their farming practices by remediating non-conformances.
Our other suppliers will continue with self-assessment against the Unilever Sustainable Agriculture Code 2010 (PDF | 2MB), until they too are invited to transition to SAC 2017.
Findings demonstrate impact
We now have data on our sustainable agriculture programme covering 2012–2017. While factors such as the variability of weather mean that this is a short period in which to identify trends in agricultural data, our findings to date are positive. Averaged across all crops in the SAC programme (and measured per tonne of product), we see:
- a 21% reduction in irrigation water use
- a 17% reduction in pesticide use, and
- a 2% reduction in carbon footprint.
For farmers who have been part of our programme since 2012, performance against most of our sustainability measures has improved. We have started to give specific feedback to individual suppliers and their farmers to help them to focus their improvement programmes.
Strategic partnerships and third-party certification schemes are a key part of our approach. Many of our raw materials are certified to sustainability standards which meet or exceed our SAC, such as those of the Rainforest Alliance, Roundtable on Sustainable Palm Oil and Round Table on Responsible Soy. These multi-stakeholder platforms help suppliers by providing a common definition of sustainable agriculture, which makes their products more marketable to us and others.
Protecting biodiversity protects agriculture
Agriculture, the livelihoods of farmers and farming communities, and the health of the planet are all dependent on the ecosystems in which crops and commodities are grown.
That means protecting biodiversity is a vital element in our Sustainable Agriculture Programme. One of the four principles in our Programme is: “Ensuring any adverse effects on biodiversity from agricultural activities are minimised and positive contributions are made where possible”. Biodiversity is also one of the 11 core indicators we use to measure sustainable farming practices.
The business case for protecting biodiversity is quite simple. Without biodiversity, there is no business.Giulia Stellari, our Sustainable Sourcing Director
Our Sustainable Agriculture Code has a specific chapter devoted to biodiversity. It covers both ecosystem services and the protection of rare and vulnerable species and ecosystems on and around farms.
Forests support 80% of terrestrial biodiversity (the variety of life forms on land) , so our commitment to take action against deforestation is also critical in this area. This is described in Protecting our forests. Our work with other organisations, and the advances being made by our Safety and Environmental Assurance Centre (SEAC) in this area, are described in Natural capital.
Biodiversity Action Plans
We want to inspire farmers to start their own Biodiversity Action Plans (BAPs). The scope for a BAP can range from field to landscape level in the growing area of any crop. The ideas behind the plans often come from farmers and suppliers themselves, based on the wild animals or plants they value or have observed.
Since biodiversity issues vary widely across the world, farmers’ efforts have resulted in a wide range of projects. Some are showcased in our booklet, Unilever Suppliers – A Closer Look at Biodiversity (PDF | 998KB).
Helping farmers & suppliers promote sustainable sourcing
We can only achieve a sustainable supply of agricultural raw materials by working with our suppliers and the farmers who grow our ingredients. Making that process both efficient and rigorous helps both us and them.
That’s why our SAC recognises a range of external standards used by suppliers to comply with the principles of sustainable agriculture – a full list can be found in our Scheme Rules (PDF | 2MB).
We will consider any current in-house or industry-level sustainability programmes that suppliers use, asking suppliers to benchmark their system or programme against our SAC, and agreeing with them which areas, if any, of a supplier or industry-level system are equivalent to the SAC.
However, we know that certification alone does not guarantee a solution to all problems. So we work in partnership with our suppliers and NGOs to drive sustainable practices across the entire value chain.
Our external advisers
We don’t claim to know all the answers when it comes to sustainable agriculture, and we welcome expertise from beyond our business. Our Sustainable Sourcing Advisory Board advises us on issues such as climate impact, biodiversity, water stress, labour conditions, poverty alleviation and the use of chemicals.
Our Sustainable Sourcing Advisory Board
Our Sustainable Sourcing Advisory Board (PDF | 372KB) (SSAB) includes seven external experts, including academics and representatives from NGOs and impact investing:
- Dr Julia Balandina Jaquier, JBJ Consult, Switzerland
- David Bright, Open Society Foundations, UK
- Professor Ken Giller, Wageningen University, The Netherlands
- Alan Knight, ArcelorMittal, UK
- Karin Kreider, ISEAL, UK
- Dr Ruth Nussbaum, Proforest, UK
See how our governance structures help us deliver the Unilever Sustainable Living Plan.