Palm Supporting the production of sustainable palm oil – increasing demands for sustainable palm oil 16 | AAK Responsible Growth Food manufacturers and retailers have an easy way to reward palm oil producers for adhering to sustainable and responsible practices, and to tell their customers that they have done so. It is an exclusive, RSPO-endorsed, webbased platform for trading in sustainable palm oil certificates, called the GreenPalm Program. Organised by Book & Claim Ltd, an AAK subsidiary, the platform makes it possible for end-users to pay producers directly for certified sustainable palm oil (CSPO). There are three obvious advantages to this: Globally, palm oil is the most produced and consumed vegetable oil, accounting for 33 percent of the world’s vegetable oil production. Soya bean oil, at 27 percent, holds second place. The oil palm has the highest yield of all oil crops at an average of 3.7 tonnes of oil per hectare – soya bean yield being around a tenth. While this makes palm oil plantations highly efficient, palm oil production has raised serious concerns, including relating to deforestation and elimination of orangutan habitats to name two. In 2003, WWF initiated the Roundtable on Sustainable Palm Oil (RSPO) along with AAK, Golden Hope Plantations, Migros, Malaysian Palm Oil Association, Sainsbury’s and Unilever. The organisation has now worked for more than a decade to promote the growth and use of sustainable palm oil worldwide. Due to our position as an intermediary in the palm oil supply chain, we are fully dependent on the availability of supply of physical, segregated sustainable palm oil and, to some extent, on the demand from customers. Customer requirements define the kind of palm oil we deliver and we see increasing demands for sustainable palm oil. In preparation for the future demand all of our major production plants have obtained RSPO Supply Chain Certification and are ready to produce sustainable palm oil as required. Our overall aim, as stated in the annual progress report to the RSPO, is for all palm oil used in AAK’s production plants to be RSPO-certified sustainable by the end of 2015. However with the current supply limitation, and the limited demand from our customers, this target looks challenging. RSPO progress AAK has continued its close involvement with the RSPO, as a founding member eleven years ago, as an Executive Board member ever since, and as a strong supporter. The RSPO has continued to grow rapidly, with over 1,000 members and now more than 8.5 million tonnes of certified production, covering over 15 percent of global palm oil production. Such progress is a significant achievement, with growth far exceeding that of other similar commodity and multi-stakeholder initiatives. The RSPO’s profile as the benchmark for palm sustainability has steadily increased, and with such a profile come inevitable criticisms. Many are concerned that the RSPO’s new Principles and Criteria, though clearly a significant step forward, do not go far enough (in particular, with regard to carbon emissions). Manufacturers of consumer products get a simple way to support sustainable palm production Sustainable palm oil producers can obtain a premium for their efforts Smallholders who lack access to a certified supply chain now have a certification option The GreenPalm Program supports the production of sustainable palm products that meet the requirements defined in the Principles and Criteria of the Roundtable on Sustainable Palm Oil (RSPO). As it expands, the onus is on the RSPO to further develop internal governance and to respond to the demands of worldwide markets. The challenge for the RSPO and its members remains to take the next step towards making sustainable palm oil the norm. Smallholders (responsible for a significant proportion of global production, but with only a small part certified) must be incentivised to join so that palm oil becomes known for its sustainability credentials. Tim Stephenson Finance and Global Trading Director RSPO Executive Board Member
AAK Responsible Growth 2012-2013 - UK
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