Consumers around the world are beginning to favour responsibly produced goods; and many companies that manufacture end-user goods have given themselves deadlines of between 2015 and 2020 to source 100% sustainable products to meet market demand. It is therefore critical that palm oil companies and the governments of the countries that produce them realize how important it is to move in this direction.

In December 2013, Wilmar International Limited announced a “No deforestation, no peat and no exploitation” policy, with sustainability commitments covering the company’s entire palm oil supply chain. There is a need for momentum towards a more sustainable future in an industry that continues to be embroiled in debates over deforestation, biodiversity loss, greenhouse gas emissions and social conflicts.

It is a time for ambitious goals and strategies, and we believe these can be achieved if all actors and key stakeholders work together. Among planters, the younger generation is helping to raise awareness about global sustainability issues. They are very committed to ensuring responsible frameworks and approaches are in place for the future, but they need support from all of us. Substantial challenges lie ahead, not only in coordination but in implementation on the ground, and this effort will require investment of time and resources to build capacity across supply chains.

Wilmar is working to achieve these goals. Since the announcement of the policy 10 months ago, progress includes:

  • Active socialization of new policies to our suppliers to make sure they understand and commit to the new approach and goals
  • Engagement with customers, investors, bankers and other stakeholders who have a keen interest in a sustainable palm oil industry
  • Mapping the company’s supply chain
  • Risk assessments on Wilmar’s own operations and that of its key suppliers
  • Communication on progress through our quarterly updates, which can be found online
  • Establishment of a grievance procedure
  • Building the capacity of the internal team to meet an ambitious timeline

Even with all our best efforts and intentions in working towards fulfilling our policy commitment, I would like to emphasize that the work we are doing to make the industry more sustainable is a shared responsibility and requires concerted efforts from all actors along the value chain, including and especially the financial community, which can have considerable leverage over the business conduct of the industry.

We certainly recognize that there are issues, whether environmental or social, and that industry practices fluctuate. What is important is the long-term commitment of suppliers to proactively address these issues. Our goal is to support our suppliers as they tackle the challenges, and enable the development and strengthening of a responsible and sustainable industry.

The sustainability agenda has come to the fore recently, with a number of major palm oil producers adopting similar policies. But the pace needs to increase still further, to produce the desired change in curbing deforestation within these ambitious timelines. The industry as a whole needs to adjust to market needs and expectations if it wants to remain competitive.

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Author: Jeremy Goon, Chief Sustainability Officer, Wilmar International, Singapore

Image: Omar Aguilar, a pruner or “desmochador”, climbs a Royal Palm tree to cut branches of berries on a farm on the outskirts of Havana February 17, 2011. REUTERS/Desmond Boylan