In partnership with the Malaysia Institute for Supply Chain Innovation (MISI), the consumer goods multinational, whose brands include Head & Shoulders and Old Spice, is set to carry out an in-field study to understand the practices of small farmers, in order to be able to apply these to its wider sourcing practices.
"We want to make the sourcing of palm oil and palm kernel oil sustainable from start to finish - and still economically viable for local farmers who depend on the crop to support their families," said Len Sauers, vice president of P&G Sustainability, has said.
A large minority
The consumer goods giant points out that although it is already making strides with the larger players in palm oil production, smaller producers together account for ’35-45%’ of the market.
“We need to understand their needs and practices so we can create innovative solutions to the problem, just like we understand the day-to-day lives of consumers to meet their needs with innovative products," asserted Sauers.
The study will form a key part of the company’s pledge to reduce to zero deforestation in its products’ palm oil supply chain, which requires that the ingredient can be traced right back to the plantations.
Responsible sourcing
After lobbying earlier in the year from NGO Greenpeace, including a protest in which activists abseiled down the face of the P&G Ohio headquarters, the Gillette brand-owner mobilised in committing to sustainable palm oil sourcing.
With its new plan, P&G hopes to establish traceability of palm oil and palm kernel oil to supplier mills by December 31, 2015, and ensure no deforestation in the palm supply chain to plantations by 2020.
"P&G's commitment to no deforestation in its palm supply chain is unequivocal. Our aim is to develop effective long-term solutions to the complicated issue of palm oil sustainability,” Sauers has said.
“We are committed to driving positive change throughout the entire supply chain, not just for us, but for the industry and for the small farmers who depend on this crop.”