We are concerned about the palm oil supply chain and its impact on the environment, workers, and communities. Palm oil expansion has contributed to deforestation and climate change, as well as other negative impacts on biodiversity, endangered species, and the broader environment.
And despite being a highly productive crop that can offer a path out of poverty, unsustainable palm oil production practices can also threaten the rights of rural communities and indigenous peoples.
In 2010, we made a commitment to source 100% of our palm oil from responsible and sustainable sources. This goal was achieved in 2015 through the purchase of RSPO certified volumes and we have continued to maintain that performance year on year.
Since 2014, we have evolved our sustainable palm sourcing activities reflecting the need to enhance our response to the complex sustainability challenges facing the sector. This began with our first statement on sustainable palm sourcing (2014) and was followed by the introduction of an annual supplier engagement process designed to evaluate the progress of our direct palm suppliers in meeting the principles set out in our policy.
In this Palm Oil Progress Update – the first produced by General Mills – we wanted to take this opportunity to highlight to our stakeholders a number of recent progress areas as we seek to deliver on our commitments. Highlights include:
- Updated Palm Oil Policy and Statement (2018)
- Status of RSPO certified volumes and traceability
- Enhanced supply chain transparency
- Introduction of internal Grievance Process
- Ongoing supplier engagement
1. Palm Oil Policy and Statement (2018)
Earlier this year we made public our revised Statement on Palm Oil Sourcing (2018). These updates have strengthened the principles we expect of direct suppliers and ensure that they are in line with industry best-practice. Specific revisions and expectations of our supply base include:
Critically, General Mills is now more actively engaging its suppliers in direct review of their palm oil production and sourcing practices, more detail of which can be found in section 4.
2. Status of RSPO certified volumes and traceability
Our commitment to source 100% of our palm oil from responsible and sustainable sources was achieved in 2015 through the purchase of RSPO certified volumes. We have continued to maintain that performance year on year, including a purchasing shift toward mass balance and segregated oil and away from certificates.
Our aggregated purchasing volumes for 2018 (along with traceability progress figures) are expected to be available in Q1 2019, however we expect these to be line with figures for 2017 where mass balance and segregated accounted for 96 percent of our purchases, and where 99 percent of our palm oil volume was categorized as traceable to the extraction mill.
3. Enhanced supply chain transparency
We agree that mill list transparency across the sector is a necessary requirement for effective monitoring, and in 2018 we made public our global supplier mill list and will continue to update this on an annual basis.
We are pleased to see that the vast majority of our direct suppliers have done the same and, where they haven’t, we will continue to encourage them to do so.
4. General Mills Grievance Process
In 2018, we received an increasing number of producer related grievances with alleged cases of non-compliance against our policy. To ensure the effective handling of these cases, we have introduced an internal grievance management system which reflects best-practice in handling grievances.
As a brand owner and manufacturer which is often many times removed from the producer, we expect our direct suppliers to robustly manage their own supply chains to ensure palm volumes supplied to General Mills meet or exceed our standards. In cases where there is verified non-compliance with our policy, or where there is continued failure to remediate verified non-compliances in a timely manner, we take steps to remove those producers from our supply chain.
In 2018, we demonstrated this in action when we instructed our suppliers to remove Indofoods and Salim Group companies from our supply chain following persistent and concerning social and environmental allegations. More details can be found here.
5. Supplier Engagement
In 2017, with support from Proforest, General Mills began engaging its direct suppliers in review of their level of alignment with, and progress in implementing, our sustainable sourcing principles. The aim is to build up an accurate picture of how our suppliers are performing and where there may be gaps or opportunities for improvement across our key sourcing principles. This information is then fed into our annual supplier review process.
Our 2018 supplier engagement process is nearing completion and we will be analysing results from this in Q1 2019. Key focus areas we are looking at include: implementation progress, upstream supplier monitoring and verification, grievance management, transparency and reporting.
Policy expectations – supplier concession maps
General Mills expectations of its suppliers evolves over time in line with developments in our common understanding of what is needed to drive change in global palm oil supply chains. We periodically communicate these expectations to our direct suppliers as part of our engagement process.
- Mill lists: As noted earlier, we made public our global supplier mill list in 2018 and are pleased to see that the vast majority of our direct suppliers have done the same. Where they haven’t, or where we bring on new direct suppliers in the future, we will ensure that publicly available mill lists are a precondition of business with General Mills.
- Concession maps: General Mills asks our direct suppliers to commit to the publication of concession maps for all the mills purchased from and to similarly demand that all upstream suppliers make group level concession maps a requirement of trade.
May 2018-Supplier Performance Update
Due to unresolved concerns about the social and environmental record of Indofoods and Salim Group companies, General Mills has instructed its suppliers to remove palm oil originating from these companies from its supply chain. We are committed to sourcing palm oil in a socially and environmentally responsible manner and to working with suppliers to help them achieve that.
We are acting to ensure that our supply chain remains aligned with our sustainable sourcing commitments. We will continue to monitor Indofoods’ performance through third parties and ongoing engagement with our suppliers.
General Mills also confirms that palm oil from Repsa is no longer in our supply chain as a result of divestment decisions previously made in line with our policy by relevant direct suppliers.