Palm Oil Action Plan
- Sustainability
- Efforts for sustainable procurement (action plans)
- Palm Oil Action Plan
In June 2018, we established the Palm Oil Procurement Policy to further our understanding of the environmental and societal issues pertaining to the palm oil industry and contribute to the healthy development of the industry, and in December 2018, we issued a No Deforestation, No Peat, No Exploitation (NDPE) Declaration.
We have also set a CSV target of 100% traceability to plantations by FY2030, and are making efforts to establish a sustainable palm oil supply chain by formulating and revising this action plan.
Palm Oil Action Plan
Action plan and progress
| Activities | Progress in FY2023 (including some results to date) | ||
|---|---|---|---|
| 1 | Establish a traceable, transparent supply chain | (1) Participate in FFB*1 dealer projects | Held workshops with FFB dealers in collaboration with NPOs to reach a shared understanding of the significance of our NDPE Declaration. Tracked the distribution of FFBs and improved traceability to plantations from 68.5% in FY2021 to 90.9% in FY2022 |
| (2) Procure certified palm oil and ascertain traceability to plantations | Set KPIs of over 50% SG RSPO-certified oil and 100% certified oil by 2030 as the basis for ascertaining traceability to plantations (48.9% and 63.5%, respectively, from January–June 2023) | ||
| (3) Ensure transparency in all routine procurement activities | Evaluated suppliers as part of routine procurement activities. Regularly checked for RSPO certification, informed non-certified suppliers of our procurement policy, conducted on-site checks and periodic questionnaires | ||
| 2 | Protect forests and respect human rights by helping small farmers increase their productivity and profitability | (1) Plan and promote a Small Holder Support Program (direct support) | Began a three-year plan starting in 2023 with European confectionery company Ferrero and Hap Seng, one of the Group’s main sourcing plantations, to help small farmers acquire RSPO certification. Plans call for the Group to procure SG certified oil and supply it to Ferrero |
| (2) Participate in POCG*2 working groups (indirect support) | There are four groups, including groups working on small farmer production and forest protection; in FY2023, supplier compliance with NDPE policy was disclosed to establish a supply chain free of deforestation | ||
| 3 | Promote human rights efforts and collaboration with stakeholders | (1) Engagement with plantations | Surveyed work environments and hiring of plantation workers with NPOs, European confectionery company Ferrero, and KULIM, one of the Group’s main sourcing plantations, to identify issues to be addressed for improvements in the future |
| (2) Engagement with oil mills | Held workshops with small and medium-sized oil mills we work with directly to help them understand and disseminate NDPE and MSPO revision points and acquire certification | ||
| 4 | Reduce Scope 3 CO2 emissions in the palm oil supply chain | (1) Lobby Malaysian palm oil related government agencies to reduce CO2 emissions for palm oil and utilize a certified oil system | Contributed to reducing CO2 emissions by expanding procurement of RSPO- and MSPO-certified oils, which promote the reduction of CO2 emissions in the palm oil supply chain |
| (2) Use of methane fermentation gas | Methane fermentation gas, which utilizes the methane generated in the palm oil production process, was used as an energy source to replace fossil fuels in the production process, to contribute to reducing greenhouse gas emissions in the palm oil supply chain | ||
| (3) Absorb CO2 through afforestation | Planned to plant 8,000 mangrove trees on four hectares of land in three years starting in 2022 to absorb CO2 and restore ecosystems; planted 3,500 trees as of June 2023 | ||
| 5 | Social contribution activities | (1) Social contribution for residents living near the Dengkil Plant | Under consideration |
*1 FFB (Fresh fruit bunch): Palm fruit bunches harvested at plantations
*2 POCG (The Palm Oil Collaboration Group): A group of companies involved in the palm oil supply chain that aims to accelerate effective action on NDPE
Please see here for information about other action plans.
Percentage of certified oil/Traceability to oil mills and plantations
| Percentage of certified oil* | SG ratio of RSPO-certified oil | Traceability to oil mills | Traceability to plantations | |||
|---|---|---|---|---|---|---|
| Palm oil, palm kernel oil, fatty acids, etc. |
Palm oil | Palm oil | Palm oil, palm kernel oil, fatty acids, etc. |
Palm oil | Palm kernel oil | |
|
Materials procured from January–December 2023 |
58.1% | 66.9% | 56.3% | 99.6% | 92.7% | 80.9% |
|
Materials procured from July–December 2023 |
62.3% | 71.3% | 63.1% | 99.8% | 93.0% | 81.5% |
|
Materials procured from January–June 2023 |
53.6% | 62.0% | 48.9% | 98.5% | 92.4% | 69.6% |
|
Materials procured from January–December 2022 |
52.3% | 59.6% | 51.1% | 98.8% | 90.9% | 72.7% |
Data on palm oil sustainability
The following are links to a list of oil mills, our grievance procedure, a grievance log, information about our subsidiaries, and sustainable procurement reports for palm oil.