Unilever lays bare palm oil supply chain in rare industry move

LONDON (Thomson Reuters Foundation) - Consumer goods giant Unilever said on Friday it had laid bare its entire palm oil supply chain, including all the suppliers and mills it sources from, to boost transparency in a rare industry move.

Unilever said it was the first consumers goods company to publish such details, having disclosed the location of more than 1,400 mills and over 300 direct suppliers of the oil used in products from snacks and soaps to cosmetics and biofuels.

The $62 billion palm oil industry has been plagued by concerns about deforestation and human rights abuses in countries such as Indonesia, the world’s biggest producer.

Marc Engel, Unilever’s chief supply chain officer, said the company hoped sharing the information would be the start of a new industry-wide movement toward supply chain transparency.

“Unilever believes that complete transparency is needed for radical transformation,” Engel said in a statement posted on Unilever’s website.

“This is a big step toward greater transparency, but we know there is more work to be done to achieve a truly sustainable palm oil industry and we will continue our efforts to make this a reality.”

Unilever said transparency and the ability to trace palm oil are vital in addressing deforestation and human rights abuses.

Palm oil supply chains are complex as the fruit changes hands many times from farmers to agents before it reaches a mill. It is then transported via traders to refineries for further processing, when it enters a company’s supply chain.

Over the past decade, consumer activist groups have pressed big palm oil buyers such as PepsiCo, Unilever and Nestle with supermarket boycotts and other protests over palm oil’s perceived links to deforestation and human rights abuses.

Pepsi-Co last month suspended procurement from a palm oil supplier over claims of labor abuses on its Indonesian plantations.