Sustainable sourcing

Our perspective

In April 2012, we announced that we would reach our 2015 target three years ahead of schedule. This has been achieved primarily through the purchase of GreenPalm certificates. We recognise that these make a significant contribution to a more sustainable palm oil industry, but they are only a first step.

To source sustainably we need to be able to trace our palm oil back to the plantation on which it is grown, and trace its route through certified mills, transport and use. Our new target is to source all our palm oil from certified, traceable sources by 2020.

We began sourcing traceable palm oil for our European markets in 2011, from suppliers certified by the Roundtable on Sustainable Palm Oil. We are investing €69 million in a palm kernel oil processing plant in Indonesia and considering similar joint venture investments in processing crude palm oil derivatives elsewhere to help us achieve traceable supplies.

We are committed to working with suppliers, peers, competitors and governments to transform the industry. This will provide assurances to consumers and help to break the links between palm oil, deforestation and land conflict.

Promoting the uptake of sustainable palm oil in China

Around 14% of palm oil is now certified as sustainable by the RSPO, but only half the available certified sustainable palm oil is being taken up in the market.

In 2012 Unilever joined key players in industry and government for the China Sustainable Palm Oil Supply Chain Forum, for talks on promoting faster uptake in China, the world’s second-largest consumer of palm oil.

* To be independently assured by PwC in 2013.

Our perspective

Of the 63%, 87% comprised recycled fibre and 13% certified virgin fibre.

In our 2011 Progress Report we estimated that 60% of our paper and board came from sustainable sources. Since then, we have made significant improvements to our data collection and reporting processes so that we now have more detailed, auditable data that does not rely on estimates.

In 2012 we rolled out sustainable paper packaging certified by the Forest Stewardship Council for our Knorr wet soups in Europe, and for our AdeS soy drinks in Brazil.

Our perspective

We use soy oil in our spreads, mayonnaise and dressings. We have supported the Round Table on Responsible Soy (RTRS) since it first issued certificates and in 2012 we were one of the largest single purchasers of the certificates.

We buy most of our soy oil in the US, where there is currently no RTRS certified soy. Over 2011-12 we explored the potential for an RTRS National Interpretation for the US soy industry with the United Soybean Board (USB) and WWF US, but were unsuccessful. However, we have joined Field to Market: The Keystone Alliance for Sustainable Agriculture. This brings together US producers, agribusinesses, food companies and conservation organisations to create sustainable outcomes for agriculture. Its Fieldprint Calculator enables growers to analyse how their management choices impact natural resources and operational efficiency. Making use of this tool, we continue to work with the USB as it refines its Soy Pledge’s assurance protocol for sustainable soy.

In 2012, we did not purchase as much sustainable soy oil as we hoped; however, in 2013 we will begin a pilot with US soy farmers to track and verify performance improvements to achieve equivalence to our Sustainable Agriculture Code.

Soy beans make up about 10% of our soy purchases, for use in our AdeS soy drinks. We expect to make the first purchases of sustainable beans in 2013. We are determined to make progress and have a roadmap in place to meet our 2014 target.

Our perspective

In 2007 we were the first major tea company to commit to sustainable sourcing of tea on a large scale. We are on track to achieve our 2015 milestone and 2020 target.

Over the last five years Unilever and our suppliers have invested heavily in improving farming practices among tea farmers, building capacity to more than 170,000 tonnes of Rainforest Alliance certified tea. For example, all the tea we source from Argentina is now Rainforest Alliance certified, and this effort has contributed significantly to the development of the tea industry in the Misiones Province.

Between 2007 and the end of 2012, a total of around 450,000 farmers had been trained to the Rainforest Alliance standard, in partnership with Unilever, in preparation for certification.

During 2012 we continued to partner with the Netherlands-based Sustainable Trade Initiative (IDH) and the Kenya Tea Development Agency (KTDA) to co-fund farmer field schools which promote sustainable agriculture through group learning and field observation techniques.

Unilever and IDH have jointly agreed to invest a further €4 million over the next two years to help take our sustainability initiatives to scale in Africa, Vietnam and India. This training will not only benefit Unilever but also the tea industry as a whole.

Our perspective

We bought our first sustainable fruit in 2012. In 2013 we will focus our efforts on working with our suppliers and looking for further partnership opportunities as we are a small player in this market. We have not made as much progress as we would have liked. This makes our 2015 target challenging, but we have a plan in place which makes us confident we will reach it.

We exceeded our interim target for our top 13 vegetables and herbs; more than half our suppliers had self-verified their practices according to the Unilever Sustainable Agriculture Code by the end of 2012. We now have 24 ‘Landmark Farms’ supplying vegetables for our Knorr brand and acting as agricultural role models for other suppliers.

To meet our target, we have been working with suppliers and their farmers around the world to identify areas for improvement and assess their progress using the Unilever Sustainable Agriculture Code. We work with suppliers of onions, garlic and tomatoes in California, US and suppliers of gherkins and fruit in India. In India we aim to boost yields to at least the global average.

Knorr’s first product with sustainably sourced label

Knorr’s new Tomato and Mascarpone soup was launched in France in 2012 carrying the label ‘Made with sustainably grown tomatoes’. This is the first time we have promoted an ingredient as sustainably sourced with farmers verifying their progress in accordance with Unilever’s Sustainable Agriculture Code.

We have been working with tomato suppliers for the last 15 years to reach this point. Building traceability has been key – to ensure that the tomatoes that reach our packs are sustainably grown and traceable right through the supply chain and manufacturing process.

Our perspective

On pack and online, Magnum shares with its consumers why it has teamed up with Rainforest Alliance: to source high-quality cocoa beans, to increase the income of farmers and deliver social benefits such as improved health and safety practices.

To achieve certification, we are working with 20,000 small farmers across West Africa. Our strategic supply partner, Barry Callebaut, runs farmer training schools. The schools work with groups of local farmers to build their skills and knowledge around sustainable cultivation practices. Those farmers then act as trainers spreading good practice amongst their community and encouraging more farmers to follow the programme.

Our perspective

Unilever has joined the Bonsucro roundtable, a not-for-profit initiative that is dedicated to reducing the environmental and social impacts of sugar cane production.

In December 2012, we purchased the first-ever Bonsucro sustainable sugar credits in Brazil. Although we are not a major buyer of sugar, we were the first Bonsucro member to buy credits as we are committed to the sustainable production of sugar.

In 2012, we also sourced our first sugar from beet farmers in France, Germany and the Netherlands. This was verified according to our Sustainable Agriculture Code.

Our perspective

In 2011 we scoped pilot projects for sustainable sunflower oil in several regions, but these took longer than expected to come to fruition. However, in 2012, we were able to source our first sustainable sunflower oil and are back on track to achieve our target.

Our supplies were self-verified according to our Sustainable Agriculture Code and sourced from Hungary via Cargill and from South Africa.

Investing in traceability for sunflower oil

In South Africa we have been working with our supplier Ceoco to improve traceability in the supply chain. We identified a farming community in Limpopo with good practices that we could build on, then worked with the farmers by providing financial incentives to develop hybrid seeds with higher yields. We can trace the oils right back to the individual farms where the seeds were grown.

Our next step will be to scale up the project and roll it out to different provinces and more farmers.

Our perspective

During 2012, we worked with one of our major suppliers, Cargill, to verify German oilseed rape production against the Unilever Sustainable Agriculture Code. This builds on a pilot project we began in 2009, which has helped us to agree annual improvement plans that go beyond European good agricultural practice, including biodiversity action plans to enhance habitats. We now have a model that can be applied to other oilseed crops.

In the UK, we have worked closely with the sustainable agriculture NGO, LEAF (Linking Environment And Farming), and our supplier ADM to source certified rapeseed oil at scale for the first time.

Our perspective

We made significant progress in 2012, increasing the proportion of sustainably sourced dairy ingredients from 10% in 2011 to 31% in 2012.

Following a successful pilot in 2011, we have scaled up our work with one of the largest dairy co-operatives in the world, FrieslandCampina. The company has its own sustainability commitments, such as the treatment of cows, grazing conditions, local biodiversity and waste impacts. These are aligned with the standards of our Sustainable Agriculture Code.

Our perspective

In Europe, our five key commodities (sugar, cocoa, coffee, vanilla and bananas) were converted to Fairtrade (FT) by the end of 2011.

Converting the rest of our ice creams is a major undertaking, involving around 200 ingredients for nearly 90 flavours. In 2011 we reported setbacks in the US which meant that we could not source all the FT-certified ingredients we needed for our US business.

We have found that FT ingredients are simply not available or do not meet our specifications for a range of the ingredients we use (such as some nuts and spices). So we have had to revise our target from our previous ‘all ingredients’ to ‘all flavours’.

In 2012 we worked with Fairtrade International to adjust our US conversion plan and identified that by using FT ingredients for the five major commodities in all our base mixes and for our chunks and swirls, all our ice cream flavours will qualify for FT certification by 2013. The vast majority of our ice creams will be available in stores by the end of the year, with the remainder becoming available early in 2014.

Our perspective

In Western Europe our Hellmann’s, Amora and Calvé brands have been 100% cage-free since 2009 and by the end of 2011, 99% of all eggs used in Ben & Jerry’s ice cream mix worldwide were cage-free.

We have made good progress in North America in 2012, and are confident that we will achieve 100% cage-free eggs in our mayonnaise portfolio in this region over the coming years.

Our progress has been helped by the fact that we have built long-term contracts to give suppliers the confidence to invest in cage-free production.

*Where allowed by local legislation.

Our perspective

We are making good progress towards our 2013 target and will continue to work closely with our suppliers to ensure the robustness of our reporting process.