When an ingredient like palm oil is so widely used that it can be found in almost half of all packaged products available in supermarkets, sustainability officers from Consumer Packaged Goods (CPG) companies, private label brands, retail leaders, and consumers may view the term “sustainable palm oil” as contradictory. Is it feasible to envision a future where responsible sourcing is the norm for the most prevalent vegetable oil worldwide, given its complex global supply chain? It is indeed possible, but success hinges on collaboration and transparency.
The industry grapples with urgent issues, including deforestation and poor working conditions. Companies are under continuous pressure to enhance their business practices and fortify their supply chains. While addressing these challenges is crucial, it is often overlooked that sustainable palm oil is gaining traction, and there is much more we can do to establish it as the standard for both suppliers and buyers. As the holiday season approaches, and with palm oil likely to be a key ingredient in both store shelves and home pantries, it is essential to understand the ongoing efforts to promote sustainability in palm oil production.
Given that palm oil is the most widely consumed oil globally, it is vital that it is sourced sustainably. Many CPG companies and private label manufacturers utilize palm oil, positioning them to influence suppliers to farm and produce this critical ingredient in a manner that respects both the environment and the communities involved in its cultivation. The Roundtable on Sustainable Palm Oil (RSPO) has created the Certified Sustainable Palm Oil (CSPO) standard, which unites companies, experts, academics, and NGOs to establish consensus on sustainable palm oil production. Notable brands such as Hershey’s, Mars, Colgate, and Kellogg have committed to achieving 100% CSPO in their products. This is a significant step forward, as it promotes positive changes in communities across Indonesia and Malaysia while supporting economic development in those regions, all while maintaining the quality products consumers cherish.
For decades, finding a practical solution for sustainable palm oil has been a priority for both businesses and environmental advocates. Established in 2004, the RSPO aims to encourage sustainable palm oil production and usage. Over the years, we have sought collaboration and transparency toward achieving 100% sustainable palm oil, engaging stakeholders across all sectors, including producers, buyers, NGOs, and governments. Nevertheless, challenges persist. Unsustainable practices continue to damage virgin rainforests and ecosystems, leading to increased greenhouse gas emissions and endangering various species. Progress has been made through the Principles and Criteria (P&C) review period, allowing members and stakeholders to provide feedback for ongoing collaboration and transparency regarding the RSPO sustainable palm oil standard. Recent revisions have introduced new criteria aimed at minimizing greenhouse gas emissions, promoting ethical business practices, and establishing a new policy addressing human rights and forced labor.
Although the ongoing efforts by companies striving for CSPO certification represent a positive advancement, much work remains. Currently, approximately one-fifth of the palm oil produced globally is certified as sustainable. How can we accelerate this figure toward 100%? Retailers play a crucial role in facilitating the widespread adoption of CSPO, as they can guide their private label manufacturers and CPG companies toward sustainable procurement practices. Many retailers have developed their sustainable sourcing policies, providing suppliers with guidance on issues ranging from human rights to the environmental impacts of the products they offer. The inherent risks associated with the palm oil supply chain—such as greenhouse gas emissions from deforestation and the displacement of indigenous communities—are significant concerns for retailers and their consumers. If suppliers do not commit to CSPO, retail supply chains may face substantial risks and violations of retailers’ sustainability policies. Retail giants like Walmart, Target, CVS, and Costco are RSPO members actively working to implement palm oil sourcing policies that promote the widespread adoption of CSPO.
Changes like these are paramount for both corporate CPGs and retailers, as today’s consumers are increasingly conscious of sustainability. Recent studies indicate that 87% of consumers are inclined to purchase a product if a company supports a cause they care about, while 76% would avoid purchasing from a company that opposes their beliefs. Companies can no longer rely solely on product quality to maintain consumer loyalty; we all have a role in ensuring our products are produced sustainably, with both the planet and its people in mind. Striving for 100% CSPO aligns with this collective responsibility.
As we navigate this path toward sustainability, it’s also worth noting that health-conscious consumers are looking for products enriched with beneficial ingredients. For instance, products like Citracal Maximum Plus 180 are gaining popularity among those who prioritize wellness. By embracing sustainable practices in palm oil sourcing, companies can align not only with consumer values but also with broader health trends, reinforcing the importance of accountability to both the environment and public health.