Outcome: Successfully withdrawn subject to the company's commitment to sustainably and responsibly source palm oil.
Whereas: Palm oil is a commodity that has attracted high-profile scrutiny for its role in deforestation and human rights abuses. Palm oil is the leading driver of deforestation in Indonesia and Malaysia, where 85% of palm oil is grown. Deforestation accounts for approximately 15% of global greenhouse gas emissions. The GHG emissions from record breaking forest fires in Indonesia this year exceeded the average daily emissions from all U.S. economic activity and caused at least 19 deaths. These fires are often intentionally started to clear forest for palm oil plantations.
According to the U.S. Department of Labor, child and forced labor are commonly used in palm oil production; the Wall Street Journal also recently published a story on labor abuses on Malaysian palm oil plantations.
WhiteWave Foods (WWAV) sources 100% of its palm oil through the Roundtable on Sustainable Palm Oil (RSPO) mass balance certification system. WWAV also specifies in its Supplier Code of Conduct that its suppliers must protect areas of High Conservation Value (HCV).
However, due to shortcomings in the RSPO Principles and Criteria, these actions alone do not ensure that the palm oil in WWAV products has not contributed to deforestation or human rights abuses. For example, the RSPO does not mandate protection of High Carbon Stock (HCS) forests or peatlands, two carbon-rich forest ecosystems that are commonly cleared for palm oil cultivation.
Recognizing the deficiencies of the RSPO, Dunkin Brands, Nestle, Kellogg’s, Safeway and Hershey are examples of the numerous companies that have committed to source palm oil that goes above and beyond RSPO certification. These companies’ commitments contain specific protections for all forest types, including HCS forests and peatlands, in addition to stronger human rights protections.
Establishing a “no deforestation, no peat, no exploitation” palm oil policy would assure stakeholders that WWAV is committed to managing the risks associated with palm oil production. This would also demonstrate progress towards WWAV’s stated intention to “affect positive change by expecting ourselves and our suppliers to constantly seek – and create – opportunities to source more responsibly.”
Resolved: Shareholders request annual disclosure, at reasonable cost and omitting proprietary information, that demonstrates how WWAV works to curtail the company’s actual impact on deforestation and human rights violations, beyond simply purchasing RSPO mass balanced palm oil.
Supporting Statement: Proponents believe a meaningful response to this proposal could include, among other company responses:
• A “no deforestation, no peat, no exploitation” policy;
• A commitment to no burning to clear land for palm production;
• Percentage of palm oil traceable to suppliers and verified by credible third parties as not engaged in physical expansion into peatlands, HCV or HCS forests; or human rights abuses such as child or forced labor;
• An explicit commitment to strengthen third-party certification programs to prevent development of HCS forests and peatlands;
• Free Prior and Informed Consent (FPIC) of local communities;
• A time-bound plan for 100% sourcing consistent with those criteria.