April 20, 2018

TFT challenged to clean up its members’ supply chains

( - Considering that numerous major palm oil buyers and suppliers are members of The Forest Trust (TFT), posed the following three questions via email to this organization (Apr 18) related to the recent decision by UK supermarket chain Iceland not to use palm oil in its brand products from the beginning of next year.

First of all, TFT was asked whether it agrees with the statement from Greenpeace UK that Iceland's decision is a direct response to the failure of the palm oil industry to clean up its act.

Secondly, with reference to the same Greenpeace statement, is it fair to conclude that Iceland's decision similarly reflects a failure on the part of TFT to ensure deforestation-free supply chains among the major palm oil buyers and suppliers that make up its membership?

Thirdly, in view of the fact that deforestation and peat destruction associated with the supply chains of major palm oil buyers and suppliers - most of which are TFT members - is ongoing, does TFT feel the Greenpeace statement is valid?

In reply to (Apr 18), TFT stated that it is in the process of writing about this matter (Iceland's decision).

A day later (Apr 19), TFT sent an email including a link to an open response posted on its website concerning Iceland's move entitled ‘Iceland is bowing out of the palm oil fight: Here's why it shouldn't.’

In reaction to this email, informed TFT that its open response did not adequately answer the three specific questions put to it. TFT subsequently promised to address these three questions by Monday at the soonest (Apr 23).

Nonetheless, the team regards certain aspects of TFT's open response as relevant enough to form the basis of this news report.

The mention of TFT members in this news report refers specifically to those members which have declared deforestation-free palm oil supply chains while, in reality, continuing to be linked with deforestation and peat destruction.

Measuring real impacts

TFT's open response failed to address exactly how many hectares of land have been subjected to deforestation and peat destruction by its members, from the time they became TFT members until its response was released.

For example, TFT has yet to be open with the public about the real impact of Wilmar's supply chains, which were declared deforestation-free in early December 2013 as part of the company's No Deforestation, No Peat, No Exploitation Policy. Initial estimations were that Wilmar's policy would significantly reduce carbon emissions, in particular thanks to its ending of deforestation and new peat development.

TFT should also reveal how many hectares of high carbon stock (HCS) forests and peatlands have been successfully saved and how many have failed to be saved from the supply chains of the world's largest palm oil traders, both from December 2013 to December 2015 as well as after 2015.

TFT is undeniably aware that, as of today, Wilmar's supply chains remain connected to major palm oil buyers, such as Nestle and Unilever, which are still linked to deforestation, new peat development and the clearing of orangutan habitat.

In fact, TFT should really divulge the real effects - as measured on the ground - of the implementation of deforestation-free supply chains by all its members, not only Wilmar. By doing this, TFT would not merely be able to hide behind its so-called ‘change journey’ while the supply chains of its members remain inextricably linked to deforestation and peat destruction.

If this situation persists, the business transformation model TFT attempts to apply to its members will be seen as increasingly irresponsible and lose trust due to its contradictions.

On the one hand, TFT espouses a policy of 'no deforestation, no new peat development' for palm oil supply chains, yet what happens in the field is actually more deforestation and more new peat development.

The following photos portray a recent example of how Wilmar, one of TFT's key members, has failed to clean up its supply chains from the destruction of peatlands which play host to the critically-endangered Bornean orangutan in the GAMA palm oil concession. The Indonesian Environment and Forestry Ministry is currently taking law enforcement measures in this case against these peat violations.

Transparency with lack of monitoring

Improved supply chain transparency, especially from TFT members, would certainly be appreciated. However, such progress needs to be backed up by a robust monitoring system, something neither TFT itself nor its individual corporate members possess.

As a result, TFT members are unable to escape from the smear of deforestation and peat destruction that continues to stick to their supply chains. Indeed, numerous reports from various NGOs indicate that TFT's members are still seriously linked with deforestation and peat destruction.

If any attempts at improved transparency fail to have a real positive impact by making the supply chains of TFT members truly deforestation-free, and the current facts on the ground linking these supply chains to deforestation and peat destruction persist, then any further TFT arguments and opinions would be hard to take seriously.

TFT's ability to bring about true transformation is in doubt, as exemplified by the ongoing clearing of Papua's HCS forests and vanishing Bornean orangutan habitat, both of which are directly related to Wilmar's supply chains. There are important questions to be asked as to why no announcement from TFT suspending Wilmar's membership has ever been forthcoming.

Such questions not only pertain to Wilmar, but also to the supply chains of Nestle which remain tied to deforestation and peat destruction. TFT has also yet to address this, and such silence can only cause further distrust about the supply chain transformation it is supposedly facilitating.

The photos below depict another example of peat violations, in this case by two palm oil companies - whose operations have been halted by the Indonesian forestry authorities for peat violations - which are linked to the supply chains of TFT members, most notably Wilmar.

Importance of third-party monitoring

TFT also needs to recognize the significance of the role played by third-party monitoring in exposing deforestation and peat destruction practices carried out within the supply chains of its members.

Supply chain transformation by TFT members would in fact be unimaginable without such third-party monitoring, given TFT's lack of monitoring resources.

The facts confirm that third-party monitoring has contributed to putting pressure on TFT members to clean up their supply chains from deforestation and peat destruction.

Wrapping up its analysis, the team has come to the conclusion that if TFT continues to fail to ensure that the supply chains of its members are genuinely deforestation free, there would be no good reason whatsoever to trust in the supply chain transformation that TFT claims to be facilitating for its members.