Deforestation for an oil palm plantation in Borneo
Personal care products giant Johnson & Johnson (J&J – NYSE:JNJ) today unveiled a comprehensive palm oil sourcing policy that eliminates deforestation and social conflict from its global palm oil supply chain.
The policy applies to all palm oil and palm oil derivatives J&J uses. The company says it presently sources about 75,000 tons — about 0.2 percent of global palm oil production — annually, most of which goes into shampoos, soaps, lotions and creams.
J&J will work with The Forest Trust (TFT), an NGO that helps companies implement zero deforestation and zero conflict commitments for various commodities. TFT has recently signed similar commitments with Nestle, Indonesian palm oil giant Golden-Agri Resources, Neste Oil, Ferrero, Reckitt Benckiser, Asia Pulp & Paper, Wilmar, New Britain Palm Oil, Cerelia, Vandemoortele, Mars; Florin, and Delhaize Group, among others.
But the J&J deal may be more complex than some of the other agreements since the majority of consumer product company’s palm oil use comes in the form of oleo-chemicals derived from palm oil and palm kernel oil.
J&J explains: “Most of the palm oil that Johnson & Johnson companies buy is not directly from the plantations where it is grown. Rather, we purchase surfactants, conditioners and emulsifiers that are derived from the class of chemicals called “oleo-chemicals” (chemicals derived from a plant or animal fat), derived from palm oil. Palm oil supplies from different plantations, processing plants and countries are intermingled at each stage of the production and delivery process making it very difficult to verify the origins of the raw materials used to produce the oleo-chemicals we use in our supply chains.”
But J&J and TFT say they are up to the challenge. Together they plan to set up sourcing systems that deliver fully traceable palm oil. The hope is that the effort will help provide a path for other companies to move toward greener palm oil sourcing and production. In support of that goal, J&J intends to blog about its progress.
“In the past, many companies have considered palm oil derivatives supply chains ‘too complex’ to provide traceable sourcing,” said TFT in a statement. “J&J is eager to tackle this complexity with TFT, map its supply chain and innovate with its suppliers to build traceability and responsible practices throughout its supply. The company is also inviting other actors, such as brands, in the palm oil derivative market to join them in addressing this challenge.”
J&J’s commitment involves a range of social and environmental criteria, including no conversion of high conservation value areas or high carbon stock forests; no conversion of peatlands; zero tolerance for burning to clear land; no forced, bonded or child labor; respect for the rights of all workers including migrant workers; respect for local communities’ right to reject new plantations; and inclusion of smallholders in the supply chain. J&J says it will require suppliers to also implement criteria set by the Roundtable on Sustainable Palm Oil (RSPO).
“Although our usage is small on the global scale, we are committed to using our buying position to drive responsible palm oil practices worldwide,” said J&J.
Paulette Frank, Vice President of Sustainability at J&J, added that “deforestation and social injustices” associated with palm oil production “must stop”.
New plantation development in Malaysia
J&J’s commitment is part of a widening trend among consumer products companies to adopt stricter palm oil sourcing policies as an instrument for cleaning up abuses in the industry. Activists are now singling out perceived laggards and campaigning to get them to also commit to zero-deforestation, conflict-free palm oil. For example, the Rainforest Action Network, the Union of Concerned Scientists and SumOfUs.org recently signaled that they are going to target food and beverage giant PepsiCo, which consumes six times as much palm oil as J&J.
Palm oil is the world’s highest-yielding commercial oilseed but the industry’s growth in recent years has taken an increasing toll on endangered rainforests and peatlands in Indonesia and Malaysia. Now palm oil companies are eyeing tropical Africa and Latin America for new plantations, posing new threats to wildlife and traditional communities in those regions. Environmentalists are trying to limit future expansion to non-forest areas, including millions of hectares of deforested scrublands in Southeast Asia and tens of millions of hectares of low productivity cattle pasture in South America.