Wilmar to require suppliers to implement ‘no-burn’ policy

Neo Chai Chin Today Online 7 Dec 13;

SINGAPORE — In a new policy that observers say could transform agricultural production, Wilmar International — the world’s biggest palm oil trader — will require its suppliers to stop deforestation and development on peatland, and implement a “no-burn” policy on all their plantations.

It has also pledged to ensure both its own plantations and companies from which it sources will “provide only products that are free from links to deforestation or abuse of human rights and local communities”.

The Singapore-listed firm expects its suppliers to be fully compliant with its new No Deforestation, No Peat, No Exploitation policy by Dec 31, 2015.

Palm oil companies have been accused of destroying rainforests and burning carbon-rich peatlands to clear land for plantations. Some of them came under the spotlight after thick haze blanketed Singapore and parts of Malaysia and Indonesia in June.

A Wilmar spokesperson said some commitments had already been made previously, in line with standards set by the Roundtable on Sustainable Palm Oil, an industry body.

But, with greater expectations for more responsible sourcing, “this policy is to ensure our supply chain meets stakeholder aspirations and expectations”, said the spokesperson. Wilmar Chief Executive Kuok Khoon Hong said the firm believes the palm oil sector “can provide a sustainable and affordable source of vegetable oil to meet rising global demand” for products produced in a “responsible” manner.

Given its central role in the palm oil industry, the firm’s commitment could “transform agricultural production to a responsible basis”, said Mr Glenn Hurowitz of Climate Advisers, which worked closely with Wilmar to develop the new policy.

On Thursday, Wilmar signed a Memorandum of Understanding with consumer-goods firm Unilever to spur the palm oil industry towards sustainability. Unilever — which buys about 3 per cent of the palm oil produced globally, or about 1.5 million tonnes annually — announced last month that all the palm oil it purchased will be traceable to known sources by the end of next year.

Environmental campaign group Greenpeace said the success of Wilmar’s policy depends on how it is implemented and enforced. Now, it is up to other palm oil traders, such as Cargill, Musim Mas and Sime Darby, to release similar policies, said Bustar Maitar, Head of Greenpeace’s Forest Campaign in Indonesia.

Wilmar said it would provide quarterly public updates in the first year of the policy’s implementation, with regular updates given thereafter.

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