We remain committed to achieve our bold target to source 100% of our agricultural raw materials sustainably by 2020.
What do we mean by sustainable agricultural sourcing?
Sustainable agriculture means growing food in ways which sustain the soil, minimise water and fertiliser use, protect biodiversity and enhance farmers’ livelihoods.
When we began working on this issue over 15 years ago, there was no agreed definition. So we pioneered our Sustainable Agriculture Programme. We have since developed detailed guidelines for key crops, as each raw material has a different growing method. These are published in our Unilever Sustainable Agriculture Code (SAC) | 696KB, which we require all our suppliers to follow.
We define sustainable sourcing 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 also have a definition for sustainable paper and board materials. We have developed a metric for tracking sustainable sourcing of raw materials. This is defined as either raw or packaging material sourced from verifiable sustainable renewable sources, or made from recycled materials (% by weight).
Our Sustainable Agriculture Programme relies on compliance with our SAC and continuous improvement. This is done through self-assessment against the Code, or through external certification that meets or exceeds our own standards. For example, the Rainforest Alliance (RA) Certified™ seal provides reassurance to consumers that certified products are sourced from farms applying rigorous sustainability standards. RA supports our supplier development programme across all major tea producing countries. We helped establish the Roundtable on Sustainable Palm Oil (RSPO), made up of buyers, processors and plantation owners. This provides the standard for sustainable palm oil cultivation.
We started with our top ten agricultural materials, accounting for around 70% of our total volumes and the materials our business depends on. We then started to consider the next eight materials which account for around 10% of our total volumes.
In 2014, we increased our efforts by setting out to drive transformational change in agricultural systems as a whole. In addition to the programmes we already have in place, we are championing smallholder farmers, the mainstreaming of sustainable agriculture, and the elimination of deforestation from supply chains.
We aim to create systemic change in agricultural systems by:
- sustainably sourcing to the highest standards in our own operations first
- driving change through continuous improvement policies with suppliers
- raising awareness of sustainable sourcing amongst our consumers
- playing a leading role in the transformation of agriculture sectors relevant to our business
- developing a sustainable tea and palm oil industry
- protecting biodiversity.
In 2014, we launched our Responsible Sourcing Policy (RSP) | 4.1MB and continuous improvement ladder for suppliers. This replaces our previous Supplier Code, and demonstrates a more rigorous and rewarding approach to responsible and sustainable sourcing. It includes, for example, promoting fundamental human rights.
We are committed to sourcing 100% of our agricultural raw materials sustainably by 2020.
Progress to date
We have made considerable progress since 2010, reaching 60% by 2015. We are starting to see this delivering benefits, for example our biggest brand Knorr now sources 92% of its top 13 vegetable and herb ingredients from sustainable sources for its sauces, soups and seasonings and is able to communicate with its consumers about its sustainable sourcing credentials.
Sustainable sourcing progress 2010 - 2015
Sustainable sourcing of all our agricultural raw materials remains an ambitious target, especially where our market influence is low because we buy small volumes. We will continue to work on the traceability and transparency of our raw materials’ supply, together with our suppliers.
We recognise that verification and certification are not end goals in themselves. The real challenge is to show the positive impacts that sustainability can have on the lives of farmers, their communities and the environment. We need to communicate the value of sustainable sourcing to consumers. In doing so, we will influence their buying habits towards sustainably sourced products and drive growth for our business.
Our vision is of a wider movement towards sustainable sourcing. To deliver on our ambition and drive transformational change, collaboration with partners is essential – our peers, sustainability experts, academics, governments, multi-lateral organisations and civil society organisations.
We will not reach our 2020 goal if others do not move with us to bring about this wider change. That is why we take an active role in industry collaborations such as Field to Market and the Sustainable Agriculture Initiative (SAI) Platform. We established the SAI Platform with Nestlé and Danone in 2002 to develop knowledge of sustainable agriculture - today it involves 80 companies from the food and beverage industry and communicates with a wide range of stakeholders.
A focus on palm oil
In 2009, Unilever was amongst the first companies to publicly commit to a long-term target to source 100% of our palm oil sustainably. For us, this means physically certified palm oil through both mass balance and segregated sources. We have been working hard to make this a reality, not only in our own supply chain, but across the entire industry.
In 2012, we announced that we reached our 2015 target to source 100% of our palm oil from sustainable sources three years ahead of schedule. This was achieved primarily through the purchase of GreenPalm certificates. GreenPalm is a trading programme that allows manufacturers and retailers to purchase one certificate from a grower certified by the Roundtable on Sustainable Palm Oil (RSPO) for each tonne of palm oil used.
Whilst we originally saw the purchase of GreenPalm certificates as an adequate entry point to the sustainable palm oil industry, we also recognise that it was only a first step. That is why in 2013, we announced our commitment that all palm oil bought will be traceable to known sources by the end of 2014, and will come from traceable and sources certified as sustainable by 2020. As we look at increasing our percentage of sourcing physically certified oil, we are carefully assessing the role of certificates in our supply chain.
By the end of 2015, 73% of the palm oil in our supply chain was traceable to known mills. In 2015 we accelerated sourcing of physically certified palm oil to 19% (up from 8% in 2014). Our remaining 81% is covered by GreenPalm certificates. We will phase out GreenPalm as we progress towards 100% physically certified oil by 2020.
Our progress on traceability and transparency for palm oil, as well as other commodities, is being enhanced through our partnership with the World Resources Institute (WRI), Proforest and Daemeter. Together we are implementing a robust traceability and risk verification system on the ground with WRI’s Global Forest Watch Platform. This is a dynamic online monitoring and alert system to help protect forests worldwide. It is the first platform to use the latest satellite technology, open data and crowd-sourcing to guarantee access to timely and reliable information about forests.
Timeline to achieve our targets:
From 2017, all of the palm oil we source will be traceable to known origins. Upstream suppliers would be required to provide independent third party verification that the palm oil supplied to Unilever meets the Principles outlined in our Sustainable Palm Oil Sourcing Policy if those sources are deemed high risks.
From 2018, all of the palm oil we source will be traceable to plantation. All non-smallholder sources of palm oil in our supply chain will be required to provide independent third-party verification to best practice standards that the oil supplied to Unilever meets the principles of our Sustainable Palm Oil Sourcing Policy. We will source all of our palm oil from physically certified or third-party verified sources.
By 2020, all of the palm oil suppliers in Unilever’s supply chain will have been verified by independent third parties to be compliant with the Sustainable Palm Oil Sourcing Policy and meeting high industry standards throughout their operations.
Transformational change - Discover how we’re driving transformational change by eliminating deforestation, championing sustainable agriculture and smallholder farmers, and improving water, sanitation and hygiene.
Unilever Sustainable Living Plan, Mobilising Collective Action: Summary of progress 2015
Annual Report and Accounts 2015