- Cargill is the latest palm oil user to take action against IOI Group after its sustainability certification was suspended by the Roundtable on Sustainable Palm Oil earlier this year.
- Three of IOI’s subsidiaries in Indonesian Borneo are alleged to have cleared rainforest without the proper government permits, operated on carbon-rich deep peat soil, and used fire to clear land cheaply — practices not uncommon in an industry rife with illegality.
- Until its suspension, IOI was one of the biggest suppliers of RSPO-brand “Certified Sustainable Palm Oil.”
Cargill is the latest palm oil user to suspend ties with IOI Group, the Malaysian company that has had its certification suspended from the Roundtable on Sustainable Palm Oil (RSPO) over environmental destruction in Indonesia.
Cargill, which has committed to purge its vast supply network of deforestation, peatlands conversion and human rights abuses, is one of the last major customers of IOI to act in response to the RSPO’s decision. More than two dozen consumer goods giants had already moved to cut off IOI, phase out existing supplies or suspend future purchases before Cargill made its announcement on Monday.
“IOI Group has yet to deliver a responsible sourcing policy or a detailed sustainability implementation plan to meet our requirements,” Cargill said in a statement. “Cargill will suspend business by not entering into any new purchase contracts until IOI Group can meet our requirements and comply with our sustainable palm oil policy.”
Cargill had said in late June that unless IOI issued a new sourcing policy and sustainability plan by July 15, it would not enter into any new purchase agreements with the company.
“Cargill gave IOI every opportunity to reform and IOI failed to meet their expectations. The market has spoken. IOI is not a source of responsibly produced palm oil,” said Deborah Lapidus, campaign director at the Center for International Policy.
“IOI can’t just issue another paper commitment and wipe its hands clean of its many violations,” she added. “It has serious work to do to implement a moratorium on new forest and peat clearing, demonstrate verified progress on the ground, and make up for past damage to ecosystems and communities.”