In its latest Sustainable Palm Oil Report and video, agribusiness giant Cargill tries to convince both its customers in the Snack Food 20 and the public that “Cargill surely are responsible.” The reality on the ground tells a different story.
Greenwash Alert: Here's how Cargill wants to spin its progress
Cargill dresses up its progress by talking about the initiatives it has undertaken on its own plantations only. However, Cargill is both a major importer of palm oil into the U.S., and has a two-part business model in the palm oil industry: it both owns and operates palm oil plantations in Indonesia and it purchases and trades palm oil and its derivatives worldwide. Cargill’s palm oil problem stretches far beyond its own plantations.
While it is true that progress can, and should, be made to reduce the impacts of its own plantations, the real human and environmental costs of Cargill’s palm oil business is in the actions of its suppliers in plantations where oil palm fruit is planted and grown. More spin than substance, Cargill fails to come clean about the real and ongoing impacts of its supply chain in its new video. Overly focusing on its own plantations, Cargill admits the true nature of its palm oil supply chain almost as an aside, briefly stating in its report, “we source primarily from third-party suppliers.”
Cargill first committed to eliminate palm oil suppliers associated with deforestation, degradation of carbon-rich peatlands and human and worker rights’ violations in September 2014. Since then, little progress has been made to drive real change on the ground in Indonesia, Malaysia and Latin America, where a majority of the palm oil Cargill buys and sells is produced. Take for example, the following cases where serious environmental and social impacts remain:
Problem: Land grabbing and Human Rights Abuse
The practice of land grabbing occurs when palm oil companies seize community land for the further development of plantations. Over the past years, Kuala Lumpur Kepong Berhad (KLK), a known supplier to Cargill, has attempted to pursue development in Collingwood Bay, Papua New Guinea, and Grand Bassa County, Liberia, despite active opposition and lack of Free, Prior and Informed Consent from local communities.
Grupo Olmeca, and its subsidiary REPSA, is a major palm oil company in Guatemala that according to local communities has committed egregious violations of human rights, including the alleged murder of human rights defender Rigoberto Lima Choc, who opposed its operations due to direct impacts on local communities and workers.
Cargill has failed to take meaningful and transparent actions to remedy the human rights violations of these suppliers, but has instead kept KLK and Grupo Olmeca in the supply chain with little transparency and no accountability.
Problem: Exploitation of Workers
In a recent Wall Street Journal report, forced labor and human trafficking were exposed in the operations of palm oil giant Felda Global Ventures (FGV)––a known supplier to Cargill in Malaysia where a number of Cargill’s palm oil refineries are located. Rather than admit that problems exist and develop a plan to address them, FGV has denied the accusations, accused the reporter of lying, and attempted cosmetic efforts to ride out the media storm without making any fundamental changes to its labor practices. An inadequate audit commissioned by the Roundtable on Sustainable Palm Oil (RSPO) detailed several indicators for forced labor but then failed to actually investigate two of the most critical indicators: the method of recruitment and legal work status of subcontracted workers.
Cargill has so far failed to commission a skilled labor assessor to independently and transparently verify FGV’s compliance with its policy. Even on its own plantations, Cargill’s efforts toward upholding workers’ rights are weak. In 2015, Cargill undertook a ‘labor pilot’ on its own plantation in West Kalimantan but the findings have not been published.
Problem: Deforestation Of Endangered Species Habitat and Carbon Rich Peatlands
Cargill has failed to enforced a moratorium on forest and peatland clearance in the operations of its suppliers and new acquisitions, such as the Polipant Group. Palm oil expansion continues to drive deforestation in the 6.5 million acre global biodiversity hotspot known as The Leuser Ecosystem. Located in Aceh on the island of Sumatra, it is the last place on Earth where Sumatran orangutan, tiger, elephant, rhino and sunbear coexist in the wild, and the companies responsible for the destruction of rainforests and peatlands in the area sell palm oil to Cargill’s key global suppliers.
Sadly, a devastating annual forest fire season has become the norm in Indonesia, as fires intentionally set to cheaply clear land for new plantations rage out of control. Cargill has posted maps of the fires in its own concessions as a way to appear like it is taking action to address its contribution to the fires which burn across Indonesia and blanket the skies of local villages and cities, as well as those cities across Southeast Asia, with toxic smoke each year. The fires are huge drivers of climate change, disrupt air traffic, provoke public health emergencies and trigger diplomatic crisis among Indonesia, Malaysia and Singapore. Cargill will not be able to guarantee that it is not sourcing palm oil from plantations where fires are ablaze until it requires all its suppliers to publish all concession maps and enforce a moratorium on the clearance of forests and peatlands across their entire operations.
What’s more, Cargill’s efforts to halt deforestation have taken a step backward as it supports and plans to trial the High Carbon Stock (HCS+) Study. The so-called “High Carbon Stock+” model will allow further clearance of forests and peatlands and includes a dangerous loophole that allows companies to offset ongoing deforestation in palm oil concession areas through setting aside forests in other landholdings. Its proposal to use ‘offsets’ and a ‘carbon neutral approach’ in the implementation of “No Deforestation” commitments has been criticized by many NGOs. If implemented, Cargill will continue to drive further destruction of important forests and the expansion of the flawed, industrial concession palm oil plantation model, aggressively developed in Indonesia and Malaysia into other frontier regions.
Problem: Lack of Transparency and Accountability
While Cargill has begun issuing regular progress reports in an effort to update its customers and critics these reports lack the details needed to demonstrate whether or not real progress is being made on the forest frontlines of palm oil expansion and in existing plantations growing the palm oil Cargill currently sells.
Cargill has not yet made public the names and locations of all of its suppliers in its global supply chain; its non-compliance protocols or the names of suppliers it has dropped; or data on the proportion of its suppliers that have been verified by an independent third-party as compliant with its policy. Cargill has established a grievance procedure, but has failed to ensure that it meets international norms for truly independent grievance mechanisms and the company currently fails to recognize and demand the resolution of outstanding social conflicts in its supply chain.
These cases demonstrate that more action is needed before Cargill can claim to be “responsible.” Cargill must stop misrepresenting the progress it has actually made, come clean on the ongoing impacts of its global palm oil supply chain and start taking real action to address the serious social and environmental consequences of its palm oil business.
Cargill’s business lines touch all aspects of palm oil production, trade, refining and marketing as it moves palm oil from producers to end consumers. The palm oil giant has a crucial role to play in building traceable and responsible palm oil sourcing from growers to markets. With your help, Rainforest Action Network will demand real action, not just lip service, and continue to hold Cargill to account for the impacts of its global demand for commodities, including palm oil.
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