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Cadbury, Kellogg’s revise palm oil policies

KUALA LUMPUR MALAYSIA – DECEMBER 15TH 2017. Cadbury chocolates. Cadbury is British multinational confectionery company wholly owned by Mondelez International since 2010. It is the second-largest confectionery brand in the world after Wrigley’s.

Confectionery giant Mondelēz International is transitioning to segregated palm oil for all of its Australian made products, most notably in the Cadbury Dairy Milk range.

‘Segregated’ palm oil means that it’s kept separate from ordinary palm oil throughout the supply chain and, in this instance, it will be certified by the Roundtable on Sustainable Palm Oil (RSPO).

“While Australian made Cadbury Dairy Milk chocolate doesn’t contain any palm oil, we do use a small amount in some flavoured centres and inclusions, so we want to ensure it’s sourced in the right way,” marketing director for Cadbury ANZ, Paul Chatfield said.

“We’ve worked to achieve this for many years by asking suppliers to reform their entire palm oil business, not just the volumes supplied to Mondelēz.”

Chatfield said about 96 per cent of the palm oil was traceable to the mill by the end of 2017 and 99 per cent was bought from suppliers with “best practice” sustainable principles.

“We want to make sure that when we use a small amount of palm oil in flavoured inclusions or soft centres, that it’s farmed in a sustainable way. When palm oil is farmed in a sustainable way, it’s an efficient form of vegetable oil that minimises land use and supports rural livelihoods, however it can be devastating to ecosystems when it’s farmed unsustainably,” said Chatfield.

The transition is expected to be complete by the end of March.

Cadbury uses dairy milk from Tasmanian farms, sugar from Far North Queensland and sustainable cocoa from West Africa for its popular chocolate blocks.

Chief executive of Zoos Victoria, Dr Jenny Gray, praised Cadbury’s efforts.

“It’s wonderful to see Cadbury respond to our calls for our suppliers to choose segregated palm oil. When it comes to palm oil we are focused on being the voice for wildlife, encouraging food manufacturers that use palm oil to shift to the highest standard of sustainable palm oil available. We’ve worked with Cadbury to support their transition which aims to ensure that those products that contain palm oil are not destroying precious habitats and ecosystems,” she said.

But Tracey Bailey, founder of eco store Biome, said she had some concerns.

“I see two good things about this move, but others that concern me,” Bailey told Inside FMCG.

“It is positive that Cadbury is being transparent with the consumer that its products contain palm oil instead of hiding it behind labels such as ‘vegetable oil. And secondly, committing to segregated palm oil that can be traced back to the plantation is crucial for accountability in the industry.

“However, just because palm oil is segregated does not mean that it is sustainable, and that may confuse consumers. In my opinion, RSPO certification is not reliable and certainly no guarantee of sustainability.”

Bailey said segregation is only the first step to solving this issue and believes deforestation and wildlife deaths will continue to meet the “ever increasing demand for palm oil”. 

Kellogg’s revises palm oil and deforestation policies

At a global level, the Kellogg Company recently revised its palm oil and deforestation policies.

The new policy commits to restoring forests and ecosystems which were lost or degraded; immediate suspension of companies that threaten and are violent towards human rights defenders, communities, and workers; undertaking a consistent and transparent approach to grievance management and suspending offending suppliers at a company-group level.

The move was applauded by the Rainforest Action Network (RAN).

“We applaud the Kellogg Company’s new palm oil and deforestation policies as an important step forward and urge the company to rapidly turn them into action on the ground for communities, workers, and forests. There is no time to waste,” Robin Averbeck, agribusiness campaign director at Rainforest Action Network said.

Kellogg’s said it has made “tremendous progress” on its journey to responsible sourcing and has seen improvements in transparency and sustainability.

“Through this journey, we have better understood the dynamic nature of our supply chains and our business. Although some of the priority ingredients that we selected in 2014 are still at the core of our business – like corn, wheat, rice and potatoes – others have had significant decreases in volumes due to divestiture or shifts in strategy. Similarly, new ingredients have come [to] become more material to our business as we grow in emerging markets and acquire new businesses,” Kellogg’s said in the revised policy update.

The company is now focused on the 20 most material ingredients but said this could change between now and 2030. Kellogg’s will assess material ingredients based on its global volume, global spend, environmental risk, social risk and proximity to brand.

RAN had previously cited Kellogg’s as the worst-performing business among its rival companies in a recent analysis of global food companies’ ranking their progress in fulfilling their 2020 deforestation promises.

“In the critical year of 2020, as the global climate crisis worsens and deforestation and human rights abuses continue to grow, multinational corporations must make meaningful commitments with never-before-seen ambition and back them up with robust and transparent actions,” said Avebeck.

RAN called out FMCG giants including Unilever, Nestlé, PepsiCo, Mondelēz, General Mills, Kellogg’s, Mars and The Hershey Company in the report.

“[They] have not stopped deforestation, threats to endangered species, or delivered respect for human rights or remedy for exploitation of Indigenous Peoples, local communities and workers,” said Averbeck in the report.

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