An investigation commissioned by Unilever, the world’s largest buyer of palm oil, confirms that Indonesian group Sinar Mas, the world’s second largest producer of palm oil, has been destroying forests and peatlands despite committing to “greener” palm oil production as a member of the Roundtable on Sustainable Palm Oil (RSPO). Unilever has now suspended its $32.6 million contract with Sinar Mas.
The findings of the investigation are a setback to RSPO, which has developed criteria to ensure that palm oil production is less damaging to the environment. But Greenpeace, the environmental group whose 2008 report linking Sinar Mas to deforestation spurred Unilever’s investigation, says Unilever’s decision could “could represent a defining moment for the palm oil industry.”
“What we’re seeing here is the world’s larger buyer of palm oil using its financial muscle to sanction suppliers who are destroying rain forests and clearing peatlands,” said Greenpeace director John Sauven in a statement. “This has set a new standard for others to follow. Companies that wish to be seen as environmentally responsible must immediately stop sourcing products from the Sinar Mas group.”
Response
On Saturday Sinar Mas issued a statement declaring a readiness to open discussions with Greenpeace over forest clearing in Kalimantan, but the environmental group said it will not meet with Sinar Mas until the palm oil company declares a moratorium on clearing of forests and peatlands.
According to the Jarkarta Globe, Sinar Mas labeled the Greenpeace report “one-sided, inaccurate, exaggerated and misleading.” But the investigation commissioned by Unilever found “the situation on the ground to be worse than depicted by Greenpeace,” according to the Eric Wakker of Aidenvironment, the non-profit consultancy that conducted the audit for Unilever.
Statement from Unilever
Verification of the Greenpeace report “Burning up Borneo” [PDF]
Unilever suspends palm oil contract after supplier found to be destroying rainforests
(12/12/2009) The world’s largest user of palm oil, Unilever, has suspended its $32.6 million contract with the Indonesian group Sinar Mas after an independent audit proved that Sinar Mas is involved in the destruction of rainforest, reports Reuters. The audit was conducted early this year after a report by Greenpeace alleged that Sinar Mas was engaged in deforestation and the draining of peatlands, both of which release significant amounts of greenhouse gases into the atmosphere. Deforestation across Indonesia and Malaysia, in part for oil palm plantations, has also added pressure on many many endangered species, including orangutans, tigers, elephants, and rhinos.
“Responsible” palm oil producers pledge not to develop endangered Sumatra rainforest
(11/13/2009) Members of the Roundtable on Sustainable Palm Oil (RSPO), an initiative developing criteria to improve the environmental performance of palm oil, agreed to declare the Bukit Tigapuluh Ecosystem in Sumatra a ‘high conservation value area’. The decision, voted on by RSPO General Assembly members at the group’s annual meeting earlier this month in Kuala Lumpur, effectively bans oil palm development of the endangered forest ecosystem by RSPO members.
Palm oil developers push into Indonesia’s last frontier: Papua
(11/10/2009) Oil palm developers in the Indonesian half of New Guinea are signing questionable deals that exploit local communities and put important forest ecosystems at risk, alleges a new report from Environmental Investigation Agency (EIA) and Telapak.
Sales of certified palm oil grow
(10/08/2009) Sales of palm oil certified as being produced at less cost to the environment have accelerated after a slow start, reports the Roundtable on Sustainable Palm Oil (RSPO), the body that developed the criteria for certification.
Britain bans palm oil ad campaign
(09/09/2009) Britain’s Advertising Standards Authority (ASA), a group that regulates advertisements, has again banned “misleading” ads by the palm oil industry, reports the Guardian. ASA ruled that a campaign run by the Malaysian Palm Oil Council (MPOC) makes dubious claims, including that palm oil is the “only product able to sustainably and efficiently meet a larger portion of the world’s increasing demand for oil crop-based consumer goods, foodstuffs and biofuels.” The ad said criticism over “rampant deforestation and unsound environmental practices” were part of “protectionist agendas” not based on scientific fact. ASA held the ad breached several of its advertising standards codes, including “substantiation,” “truthfulness,” and “environmental claims.” In rebuking the MPOC, the ASA said that the merits of new eco-certification scheme promoted by the palm oil industry is “still the subject of debate” and that the ad’s attacks on detractors implied that all criticisms of the palm oil industry “were without a valid or scientific basis.”
World Bank’s IFC suspends lending to palm oil companies
(09/09/2009) The World Bank has agreed to suspend International Finance Corporation (IFC) funding of the oil palm sector pending the development of safeguards to ensure that lending doesn’t cause social or environmental harm, according to a letter by World Bank President Robert Zoellick to NGOs. A recent internal audit found that IFC funding of the Wilmar Group, a plantation developer, violated the IFC’s own procedures, allowing commercial concerns to trump environmental and social standards. The findings were championed by environmental and indigenous rights’ groups who have criticized World Bank support for industrial oil palm development which they say has driven large-scale destruction of forests in Indonesia, boosting greenhouse gas emissions, endangering rare and charismatic species of wildlife, including the orangutan, and displacing forest communities.