17 F&B businesses in Singapore commit to sourcing for sustainable palm oil

Audrey Tan Straits Times 26 Feb 18;

SINGAPORE - Singapore has been free from the scourge of haze for the past two years, but at least 17 food and beverage companies here are not taking the clear skies for granted.

The 17 - including major brands such as Crystal Jade, F&N and TungLok, as well as smaller businesses such as Veganburg in Eunos and NomVNom in Tai Seng - have recently committed to sourcing for sustainable palm oil.

Of these, 10 of them made the commitment to do so this year. They include TungLok Group and Commonwealth Capital, whose portfolio includes brands like PastaMania and Baker and Cook.

On Monday (Feb 26), they officially joined the South-east Asia Alliance for Sustainable Palm Oil (Saspo) - an initiative led by the World Wide Fund for Nature (WWF) Singapore.

The alliance, formed since 2016, champions the use of sustainable palm oil in business supply chains, and now has a total of 15 member companies.

The other two F&B businesses that use sustainable palm oil are Veganburg and NomVNom. They are not part of the alliance but told The Straits Times that they have committed to sourcing for sustainable palm oil since last August and September respectively.

Ms Elaine Tan, WWF Singapore's chief executive, said Saspo is the first private sector-led initiative in the region to address the need for sustainable palm oil, in relation to the haze.

She added: "The addition of the 10 companies to Saspo raises the bar for corporate responsibility to the environment and puts the Singapore business community ahead of the region."

Mr Masagos Zulkifli, Minister for the Environment and Water Resources, who was guest of honour at Monday's Saspo event, said that with demand for palm oil projected to grow by another 50 per cent by 2020, sustainable production must take root in the industry.

"This underscores the significance of Saspo... Being the first of its kind, this industry-led initiative provides a platform for localised insights and shared resources for companies that source for sustainable palm oil," said Mr Masagos.

THE ENVIRONMENTAL HARM OF PALM OIL

The cultivation of oil palm in countries such as Indonesia has long been pointed out as a major contributor of air pollution in the region, due to drainage of carbon-rich peatland, deforestation and slash-and-burn tactics used by plantation companies and farmers to prepare land for crops.

But as palm oil is found in many products, from food items to cosmetics, banning it is a near impossible task.

Environmental groups are touting sustainable palm oil as an alternative. This refers to palm oil from plantations which adhere to strict standards set out by the Roundtable for Sustainable Palm Oil (RSPO). Among other things, certified plantations are not allowed to burn to clear land, and the rights of local communities must be respected.

Ms Zhang Wen of volunteer group the People's Movement to Stop Haze (PM.Haze) said that other important criteria under RSPO include not planting new crops on extensive areas of peat soil, maintaining water levels in existing plantations on peat, and conserving primary forests, as well as secondary forests, with high conservation value.

COSTS INVOLVED

Companies said the added costs of sourcing for sustainable palm oil were manageable, although an obstacle to more firms making the switch is a lack of awareness on the issue.

Dr Ng Wai Lek, founder of vegetarian company NomVNom, told ST that the price difference between sustainable and unsustainable palm oil is about $3 per tin.

Members of Saspo - such as TungLok Group, Wildlife Reserves Singapore and Commonwealth Capital - said during Monday's event that sustainable palm oil adds just less than 10 per cent to total operating costs.

Commonwealth Capital's group managing director Andrew Kwan said that there are audit costs involved, which can be reduced if more companies come on board and the use of sustainable palm oil is made the norm.

Businesses are also divided on whether or not to pass on the extra costs to consumers. Some, such as Veganburg and NomVNom, said they would not. "We strive to keep our food prices as reasonable as possible so we can make our sustainable and plant-based burgers accessible to everyone," said Veganburg's founder Alex Tan.

TungLok's chief executive Andrew Tjioe said it has not increased the selling price of its products even after using more expensive sustainable palm oil, although he suggested that consumers here would be willing to pay for sustainable products. "In the same way as people are willing to pay more for organic products... this (added cost) is not a problem in Singapore."

WWF's Ms Tan said that Saspo's 15 members, being prominent businesses in Singapore, could prompt smaller businesses to come on board. The alliance also plans to conduct outreach efforts to raise awareness of palm oil here.

HISTORY OF PALM OIL CAMPAIGNING IN SINGAPORE

The latest additions to Saspo follows a campaign launched by WWF last year pressuring firms here to use sustainable palm oil. WWF surveyed 27 Singapore firms from April to June using a global Palm Oil Buyers' Scorecard that the group does each year to track what companies are doing to prevent the negative impacts of palm oil production.

Among the 27 Singapore organisations contacted were Ayam Brand and Wildlife Reserves Singapore. Only 10 companies responded.

Following the release of the score card, four of the 17 companies which did not respond earlier - TungLok, Commonwealth Capital, Super Group and Bee Cheng Hiang - pledged that they would work towards using sustainable palm oil.

But there are some eateries flagged in the report that have yet to respond to WWF's latest call to switch to sustainable palm oil, including BreadTalk and Polar Puffs and Cakes.

Mr Andrew Kwan, Commonwealth Capital's group managing director, said on Monday that his company was surprised by the results of the scorecard when it was first made public, citing the lack of awareness of sustainable palm oil in Singapore.

"The lack of awareness could have contributed to the poorer take-up rate... Events like these and the press could help get more industry players on board," he said. "In this regard, we count it a privilege to help raise awareness among consumers and (those) in the market on the importance of growing businesses sustainably," he said.


Crystal Jade, Bee Cheng Hiang among Singapore firms pledging switch to sustainable palm oil
Liyana Othman Channel NewsAsia 26 Feb 18;

SINGAPORE: Ten more Singapore food and beverage (F&B) businesses have joined the Southeast Asia Alliance for Sustainable Palm Oil (SASPO), tripling the number of members since its launch in 2016.

These 10 businesses include Crystal Jade, Bee Cheng Hiang, Tung Lok,F&N and the parent company of PastaMania and Udders Ice Cream.

The addition of these 10 companies take the total number of local businesses that have publicly committed to 100 per cent sustainable palm oil to 15, accounting for more than 80 brands and 200 F&B outlets across the country.

SASPO is the first private sector-led initiative in the Southeast Asia region to address the importance of sourcing for sustainable palm oil in a bid to tackle the haze issue, which has crippled the region in the past.

It was launched by WWF and five founding companies comprising Ayam Brand (Denis Asia Pacific), Danone, IKEA, Unilever and Wildlife Reserves Singapore.

“For a business, changing palm oil sourcing is always a commitment, a joint effort and a journey. But every step taken shows other businesses in Singapore and the region that it can be done. Over time, this pushes the industry towards using a hundred per cent sustainably-sourced palm oil,” said Mr Hervé Simon, Group Marketing Director of Denis Asia Pacific, which produces Ayam Brand.

AWARENESS STILL LOW, BUT CONSUMER RESPONSE ENCOURAGING

TungLok Restaurants president and CEO Andrew Tijioe said sourcing for palm oil from plantations approved by the Roundtable for Sustainable Palm Oil was not costly.

Members of the global certification body have to comply with stringent rules, like not using the slash-and-burn technique to clear forests.

“It’s a very small difference that we don’t even care about it. It’s within 10 per cent (more than regular palm oil)”, Mr Tjioe said.

A bigger issue, he said, is a lack of awareness.

“There are many products in the restaurant that contain palm oil, like sauces. Many of them are produced in other countries like Hong Kong or China," he said.

"We have sent out a circular to them (manufacturers), asking them to declare whether their products contain sustainable palm oil. But the result is still quite lukewarm. Many of them say 'we use very little (palm oil)', or they don’t even know if their products contain sustainable or non-sustainable palm oil," he added.

WWF-Singapore CEO Elaine Tan echoed this, saying that "general awareness is pretty low in this part of the world" compared with Europe.

However, Ms Tan said the addition of the new restaurants was “testament that companies and businesses are ready, and they also want to be responsible to consumers demanding right now for sustainable palm oil”.

"I think it’s the beginning of a real ground swell," she said.

As for consumers’ buy-in, the businesses said the response has been encouraging, and people are willing to pay the premium. Mr Andrew Kwan, Group Managing Director of Common Wealth Capital - which owns brands like PastaMania, The Soup Spoon and Udders Ice Cream - likened the momentum to organic food.

"I’m hopeful and I’m quite confident that consumers will be discerning, and that they will pay just a little bit more if they know that companies that offer food are also getting products that are sustainably sourced," he said.

NOT ABOUT TURNING AWAY FROM PALM OIL COMPLETELY: MASAGOS

In 2015, raging forest fires in Indonesia caused by a combination of dry weather and slash-and-burn techniques to clear land sparked one of the worst haze crisis on record.

The haze caused the air quality in Singapore to turn hazardous, forcing the closure of schools and costing the economy an estimated S$700 million.

As a result, Singapore authorities in 2015 took action against companies believed to be behind the polluting fires, under the Transboundary Haze Pollution Act.

“We cannot resolve this issue without addressing the production of palm oil”, said Environment and Water Resources Minister Masagos Zulkifli at the announcement of SASPO’s new members on Monday (Feb 26).

But it is not about turning away from palm oil completely.

Out of the world's palm oil production, 85 per cent is produced in this region.

The palm oil industry not only contributes about up to 2.5 per cent to Indonesia’s gross national product (GNP), but also is the fourth-largest GNP contributor in Malaysia.

“The palm oil industry also supports the transition of many communities out of poverty, and significantly improves the livelihood of farmers”, Mr Masagos added.

He said that this is why Singapore supports the growth and success of a sustainable palm oil industry in the region, particularly as the demand for palm oil is expected to grow by 50 per cent by 2020.

The public has also sent signals to companies to use sustainable palm oil.

Most recently, a petition launched by two students to get food companies to make the switch garnered more than 8,000 signatures.

In 2017, a campaign led by World Wide Fund for Nature (WWF Singapore) saw people in Singapore sending 60,000 emails to local brands to show their support for responsibly-sourced palm oil.

Source: CNA/ad