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Sustainability and Palm Oil

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Presentation on theme: "Sustainability and Palm Oil"— Presentation transcript:

1 Sustainability and Palm Oil
Globoil 2015 © Kate Holt / WWF-UK

2 WWF IN SHORT +100 +5000 1961 +5M WWF is in over 100 countries, on
5 continents WWF has over 5,000 staff worldwide 1961 +5M WWF was founded In 1961 WWF has over 5 million supporters

3 WWF works with business and government on arrange of sustainability themes
Forestry Fisheries Freshwater Finance Agriculture Aquaculture Climate Change Markets Places Policies Globoil 2015 3 3

4 Palm oil’s success… Versatile with multiple applications
Relatively disease resistant Requires less inputs than most veg oils High volume of end product obtained from conversion High yields per hectare Provides livelihood for millions Affordable oil for a wide range of consumers Globoil 2015

5 …and important role in India….
The largest importer of palm oil in the world – 20% of global imports. Domestic production challenging due to unfavorable conditions and long gestation periods. Indonesia largest supplier (~70% share) followed by Malaysia. ~90% of PO in India is used for cooking/food items. Demand to reach 25 MMT in 2025. India‘s production of PO is a fraction of total demand. Globoil 2015

6 …has not been without consequences.
ENVIRONMENTAL SOCIAL Deforestation through slash and burn leading to biodiversity loss. Climate change from emissions and release of sequestered carbon from peatland draining and burning. Soil, water, and air pollution from use of inputs which have effects on local ecologies. Population displacement of local people for plantations. Disputes over workers’ rights and fair wages and conditions. Secondary and tertiary health effects from smoke inhalation caused by haze. Globoil 2015

7 Part of the global challenge of climate change…
Deforestation and forest degradation are responsible for around 15% of global greenhouse gas emissions. “Without effective action to curb emissions from deforestation and forest degradation, the probability of limiting global warming to 2°C drops from more than 90% to just 35%”. Climate Solutions: WWF’s Vision for 2050 Globoil 2015

8 Information descriptor
…with implications for business. Insuring against supply risks Buying from certified sustainable vendors/suppliers is one way to insure against supply risks and shifting legal frameworks. Protecting brand value Using sustainable palm oil shows leadership on a key global issue and a way to increase company goodwill. Maintaining access to markets Sustainable palm oil is being increasingly demanded by consumers in a range markets. Attracting investors and credit Long term investors and a growing number of banks are making aspects of sustainability a precursor to financing. +15% Information descriptor Can appear below the numbers Globoil 2015

9 Progress through the Roundtable on Sustainable Palm Oil
Started in 2003, a Industry wide, multi-stakeholder group Growers, traders, processors, retailers, NGOs, and investors Promotes palm oil production practices that help reduce deforestation, preserve biodiversity and respect the livelihoods of local communities. Ensures the integrity of the supply chain Globoil 2015

10 …and elsewhere, both overseas and locally.
Major global initiatives FMCG: Unilever Global: 100% commitment to CSPO by 2022, P&G deforestation free & traceable by 2020, Reckitt -100% CSPO/B&C by 2020, J&J - 100% GP by 2015 (already met) and 100% physical PO by 2020. Producers and Traders: Wilmar – Deforestation and peat free by 2022, Cargill – Fully traceable by 2020 in Indonesia, GAR – Commitment to physical CSPO by 2025. Indonesia: Indonesian Sustainable Palm Oil (ISPO) , Indonesian Palm Oil Pledge (IPOP) by 5 major producers. Malaysia: Malaysian Sustainable Palm Oil (MSPO), major effort to legally protect national forests. India Companies: RSPO membership increased to 43 in 2015, Certification for 9 companies/14 units as, Green Palm Certificates: 8 companies buying in 2015. Notable developments: HUL – Fully covered by GP Adani Wilmar – 4 units certified Godrej Agro –2 units certified Galaxy Surfactants – All relevant units certified Kamani Oils - 1 unit certified Fine organics – First unit certified Croda – 1 unit certified VVF – 2 units certified Croda and Worldchem – 1 unit certified RSPO re-established in Mumbai plus Roundtable initiatied by Solidaridad in Delhi. Globoil 2015

11 But significant challenges remain…
Broader trade and tariff considerations What policy incentives are needed to assist sustainable trade? Cost and complexity What supply chain innovations make sustainable palm oil cheaper? Consumer awareness What messages will most appeal to Indian consumers to be build demand? Lack of awareness and understanding in industry What training is needed ? Improvements to sustainability methods What will industry do to support the strengthening of sustainability frameworks? Globoil 2015

12 …and answers can only be found by working together.
Sustainable imports INDIAN ROUNDTABLE POLICY OPTIONS COMPANY COMMITMENTS SUPPLY CHAIN INNOVATION AWARENESS AND TRAINING GUIDELINES OR STANDARDS FOR DOMESTIC PRODUCTION INTERNATIONAL LINKAGES BUSINESS GOVERNMENT INDUSTRY ASSOCIATIONS ACADEMIA AND RESEARCH CIVIL SOCIETY INDONESIA MALAYSIA Sustainable domestic production Globoil 2015

13 What can be done straight away?
Seek membership of RSPO and become an active member Map your supply chain and identify areas of improvement in terms of traceability of to suppliers Make a positive public commitment to sustainable palm and work only with certified suppliers Acquire RSPO supply chain certification by complying with RSPO parameters and audits Collaborate with industry members and civil society to raise profile of issues for improving the overall market. Globoil 2015

14 THANK YOU Philip Tapsall Director, Sustainable Business WWF-India
Globoil 2015

15 Additional information
13 January

16 Information descriptor
RSPO - Principles and criteria to define sustainability +15% Information descriptor Can appear below the numbers Globoil 2015

17 Information descriptor
RSPO - Different approaches and degrees There are three main categories of ‘Sustainable’ Palm Oil supply chain options available for companies who are members of the Palm Oil value chain SG (Segregated) Fully traceable back to mill Most expensive but best option Separate facilities for certified palm oil and non certified oil Highest level of sustainability certification Ensures complete compliance with Zero deforestation commitments MB (Mass Balance) Partially traceable Permits mixing of CSPO and Non CSPO provided records are kept of volumes at each step Balanced option between cost and effectiveness Most popular CSPO approach globally Labeling is allowed if the final product contains PO less or equal to the proportion of CSPO in the mix B&C (Book and Claim) Offset system where buyer pays a sum to producers of sustainable PO for every ton purchased Buyer gets certificates per ton which supports producers of CSPO Market decides price of certificates which can be traded Starter option for companies – not a long term solution Information descriptor Can appear below the numbers Globoil 2015

18 RSPO India RSPO India Mr Yogesh Kolte Head, RSPO India
Globoil 2015


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