BOSTON, June 01, 2015 /3BL Media/ - Institutional investors representing over $5 trillion in assets have joined together with some of the world’s largest and most recognizable consumer brands, including PepsiCo and Procter & Gamble, to call on the Roundtable on Sustainable Palm Oil (RSPO) to strengthen its standards for certifying the sustainable production of palm oil – a key ingredient found in an estimated 50 percent of all packaged goods, from cosmetics to candy.
In a letter submitted today to the RSPO just before its European Roundtable and Board meeting in Amsterdam, investors and companies called on the RSPO to prohibit deforestation and peatland clearance for certified palm oil production and include additional environmental and human rights protections.
Signatories wrote, “[We] recognize deforestation as a significant risk to long-term business models and, consequently, investments…Palm oil production offers both challenges and opportunities to promote thriving, sustainable economic development. As such, we urge the RSPO to set and enforce standards for truly responsible and sustainable palm oil production.”
RSPO, the multi-stakeholder sustainability certification body for the palm oil industry, is tasked with providing assurance that palm oil has been produced sustainably, but has faced mounting pressure in recent years to strengthen its standards and enforcement. The standards currently do not include protections for peatlands or High Carbon Stock forests, and have an inconsistent record of enforcement. Following a recent wave of corporate commitments to source palm oil according to sustainability standards that go beyond RSPO standards, investors and companies have joined together in this letter with the aim of ensuring that the RSPO becomes a more effective tool for verifying and enforcing the sustainable production of palm oil.
Company signatories to the letter include Albertsons-Safeway, ConAgra, Coop Switzerland, Dunkin’ Brands, General Mills, Mars, Inc., Seventh Generation, Starbucks, The Kellogg Company, Walmart and five of the top 10 corporate purchasers of palm oil globally: Colgate-Palmolive, Kao Corporation (Japan), PepsiCo, The Procter & Gamble Company, and The Johnson & Johnson Family of Consumer Companies. The letter was organized by the office of New York State Comptroller Thomas P. DiNapoli and Green Century Capital Management, both members of Ceres’ Investor Network on Climate Risk (INCR) – a group of more than 110 investors focused on addressing the financial risks and seizing the economic opportunities associated with tackling sustainability challenges.
The $44 billion per year palm oil industry has become a leading driver of deforestation – which causes 15-20 percent of global greenhouse gas (GHG) emissions, according to the Environmental Protection Agency. GHG emissions are a leading cause of climate change, which scientists agree must be limited in order to prevent irreversible and potentially catastrophic impacts on the planet and the global economy. Deforestation also contributes significantly to species extinction, soil erosion, and conflicts with local communities over land rights.
In the letter, investors and companies said, “As an international certification scheme, the RSPO is uniquely positioned to support, promote, and enforce the widespread uptake of responsible and sustainable production practices across the palm oil industry. Given current gaps in RSPO certification, however, purchasing RSPO Certified Sustainable Palm Oil (CSPO) does not sufficiently address critical sustainability concerns in the palm oil supply chain.”
“Investors want their portfolio companies to have RSPO certification as part of a sustainable business strategy, but in order to enhance its credibility the certification program needs to improve,” said New York State Comptroller Thomas P. DiNapoli. “Stronger RSPO standards would allow the palm oil industry to grow, while minimizing risk to the environment and human rights.” The Comptroller’s Corporate Governance Director Patrick Doherty participated today in a press conference organized by the sustainability advocacy nonprofit, Ceres.
“Companies and investors increasingly recognize that widespread forest clearance degrades the environment and drives conflicts with local communities in ways that pose real risks to shareholder value,” said Lucia von Reusner of Green Century Capital Management, an environmentally responsible mutual fund company that has worked directly with corporations including The Kellogg Company, ConAgra, Archer Daniel Midland and Smuckers to develop their no-deforestation policies for sourcing palm oil. “We are calling on the RSPO to provide the assurance that strong protections are being upheld throughout palm oil supply chains, and to maintain its credibility in the marketplace by strengthening its standards to align with best practices that many of its member companies have already adopted.”
Specific recommendations outlined in the letter include:
- Conduct an accelerated review of RSPO’s Principles & Criteria and related documents. The review should include recommendations leading to adoption and implementation in 2016 of the following requirements for producers:
- Conserve High Carbon Stock areas;
- Protect peat, regardless of depth;
- Report on GHG emissions and reduction targets;
- Ensure full traceability back to the field;
- Strengthen transparency and monitoring
- Improve quality control measures for high conservation value and human rights assessments to ensure objective, rigorous auditing and verification, and grievance processes.
Visit www.ceres.org/rspoletter to access the letter and click here to download a recording of today’s press conference. For more information about Ceres’ Investor Network on Climate Risk, visit http://www.ceres.org/investor-network.
Ceres is a nonprofit organization mobilizing business and investor leadership on climate change, water scarcity and other global sustainability challenges. Ceres directs the Investor Network on Climate Risk (INCR), a network of institutional investors with collective assets totaling more than $13 trillion. Ceres also directs Business for Innovative Climate and Energy Policy (BICEP), an advocacy coalition of dozens of companies committed to working with policy makers to pass meaningful energy and climate legislation. For more information, visit www.ceres.org or follow on Twitter @CeresNews.
KEYWORDS: Environment and Climate Change, Business & Trade, CERES, Pepsico, Procter & Gamble, Roundtable on Sustainable Palm Oil, RSPO, Palm Oil, Sustainable palm oil, Deforestation, Albertsons-Safeway, ConAgra, Coop Switzerland, Dunkin’ Brands, General Mills, Mars, Seventh Generation, Starbucks, The Kellogg Company, Walmart, Colgate-Palmolive, Kao Corporation, The Procter & Gamble Company, johnson & johnson