Engaging our palm oil suppliers
Working with our suppliers is crucial for achieving our target of making sustainable palm oil commonplace.
Suppliers hold the key to sustainable palm oil
We know our suppliers are at different stages of progress towards sustainability. By working closely together, we can assist them in appropriate ways to deliver a positive impact. In practice, this requires a combination of approaches, including proactive engagement aimed at improving standards and responding to challenges brought to our attention.
Our work with suppliers is underpinned by our, new People and Nature cross-commodity policy (PDF | 3MB), which supersedes our previous sustainable palm oil policy, which describes our commitment to respecting human rights, adhering to national laws, becoming more inclusive of smallholder farmers and increasing the traceability of our supply chain. We require all our suppliers to comply with our Five Principles for Sustainable Palm Oil throughout their operations, including traders and their third parties.
Additionally, in November 2018, the RSPO Principles and Criteria were updated after an 18-month review process. We’ve been actively involved in this process to ensure the updated Principles and Criteria are embedded and are now inclusive of No Deforestation, No Peat, No Exploitation (NDPE) principles, as per our policy.
We believe transparency plays an important role and in 2018, we became the first consumer goods company to disclose a full list of our suppliers (PDF | 270KB) on our website. For more details of our work in this area, see Partnership and technology-led traceability.
Industry-first partnership with direct suppliers to support smallholders & 'NDPE'
Our suppliers can help us get closer to the people who grow our palm oil – which, in turn, helps us ensure it comes from sustainable sources.
In January 2018, for example, we signed a Memorandum of Understanding (MoU) with the Indonesian government-owned palm oil plantation company PT Perkebunan Nusantara (PTPN) as part of our initiative to support 25,000 smallholder farmers in priority landscapes by 2030. It sets out how we will work together to support local mills and smallholder farmers to produce palm oil according to the standards of No deforestation, No development on peat, and No exploitation of people and communities (NDPE).
As part of the partnership, PTPN will provide Unilever with access to its mills and its supplying farmer base, and we will support the mills and farmers to obtain sustainability certification through a combination of dedicated resources, funding and technical expertise. This will ensure smallholder farmers are better positioned to enter the palm oil supply chain – they will be able to increase their productivity while producing palm oil to the right standards.
Marc Engel, our Chief Supply Chain Officer, said: “The MoU with PTPN enables a partnership that will have a positive impact in Indonesia from an environmental, social and economic perspective, which makes it unique to the industry.”
This programme with PTPN is now in place in North Sumatra and Riau. All of this increases our ability to source directly from suppliers down to farm level which we know comply with the best standards of sustainability.
This work contributes to the following UN Sustainable Development Goals
Addressing concerns with our palm oil suppliers
We know serious issues, including human rights issues, exist within the palm oil industry. So, as well as working alongside our suppliers to help them improve their standards, we need to respond whenever concerns about a particular supplier are brought to our attention – and to make sure our response is transparent and appropriate.
We're committed to handling all allegations of supplier policy non-compliance responsibly and have a clear Grievance Procedure for doing so.
Our Grievance Procedure for Sustainable Palm Oil
Our Grievance Procedure for Sustainable Palm Oil (PDF | 2MB) provides a systematic framework for handling, investigating and resolving both social and environmental issues within our supply chain in a timely, transparent and effective manner.
The process includes three important steps:
- An acknowledgement of the grievance and a preliminary review to determine whether the grievance is applicable to our supply chain.
- An in-depth review of the grievance, working with the supplier and an independent organisation to develop a time-bound action and remediation plan.
- Actions implemented by the supplier to resolve the issue, with the outcomes monitored.
We will often involve an independent organisation to collate further information and outline the requirements to which the supplier needs to adhere. We have found that it is better to work with suppliers to help improve practices and resolve issues. However, we will take appropriate action consistent with our Five Principles for Sustainable Palm Oil against suppliers who are unwilling or unable to comply.
In line with our Grievance Procedure and our commitment to a sustainable palm oil industry, we have a Palm Oil Grievance Form where you can lodge a palm oil grievance, or you can email us at email@example.com. Since January 2019 we have maintained a public list of palm oil grievances, see our Palm Oil Grievance Tracker (PDF | 614KB).
In 2020, we are taking another step towards transparency and introducing a List of Suspended Palm Oil Suppliers or Oil Palm Growers (PDF | 255KB). This document publicly communicates previous direct palm oil suppliers or indirect oil palm growers that have been suspended from Unilever’s supply chain due to grievances brought to our attention alleging non-compliance against the People and Nature cross-commodity policy (PDF | 3MB) and/or Unilever’s Responsible Sourcing Policy (PDF | 9MB) or due to the fact that it could not be confirmed that these companies were in compliance with our policy at a group level.
We believe that being open and transparent about the partners we do not want to work with is key to achieving our commitment to a deforestation-free supply chain by 2023.