The Hershey Co. (NYSE: HSY) announced a new palm oil sourcing policy that updates and strengthens its commitment to source 100 percent traceable and responsible palm oil, a commitment the company announced in December 2013.
The comprehensive sourcing policy details the requirements to which all suppliers in the company’s palm oil supply chain will be held accountable. In addition to provisions that protect against deforestation, preserve native species’ habitats and protect the environment, the new sourcing policy also provides details on labor and human rights protections and the inclusion of smallholder palm farmers in the supply chain.
“Since we first joined the Roundtable on Sustainable Palm Oil (RSPO) in 2011, we have strived to ensure we are responsibly sourcing palm oil,” said Frank Day, vice president of global commodities at The Hershey Co. “Our new sourcing policy gives our stakeholders the roadmap for how we will go beyond RSPO-certified palm oil and achieve a truly responsible and sustainable palm oil supply chain at The Hershey Co. Our new palm oil sourcing approach positions us as a leader among global food companies in sustainable palm oil.”
Partnering with TFT
To help trace its palm oil supply chain and safeguard supplier adherence to the company’s new palm oil sourcing policy, Hershey has become a member of The Forest Trust (TFT). TFT will bring an important perspective and expertise to review and evaluate the Hershey palm oil supply chain and help the company make adjustments to achieve its progressive objectives. TFT is a respected global non-profit organization that works with companies to help transform the way they source their products.
“Taking the decision to actively move beyond the accepted norm in palm oil is a very commendable one,” says TFT Director Robin Barr. “It’s also essential for transformation in the industry. Hershey has put a great deal of considered thought into its policy, and the commitment to involve smallholders is vital for shaping an industry where responsibility and reward can be experienced by all.”
The Hershey Co. is working towards establishing the best path forward to a sustained, traceable, responsible palm oil supply chain, and expects to achieve traceability to the mill level by first quarter 2015. From there, the company will use this information to assess which suppliers present the highest risk for engaging in deforestation. Hershey will require that these suppliers commit to implementing responsible expansion procedures to the plantation level in 2016.
New policy reflects input of key stakeholders
>Hershey spent the first half of 2014 meeting and talking with many stakeholders across the palm oil supply chain, including commodities companies, plantation owners, non-profit groups and non-governmental organizations to fully understand the complex range of concerns and issues affecting the industry. The new policy reflects a synthesis of many stakeholders’ points of view and addresses the most important concerns in palm oil sourcing.
“This policy really touches on all of the key issues that have impacted the palm industry during the past several years,” added Day. “We are proud of a policy that sets a high bar for how palm oil can be responsibly and sustainably sourced.”
The Hershey Co. will publicly report progress annually on its website beginning in the first quarter of 2015 after having completed the initial phase of supply chain mapping with the TFT.