Olam – Green Tigers Index Rankings

SCORE

42

Olam is a Singapore-based commodity trader. In 2010, Olam entered a joint venture agreement with the government of the Republic of Gabon that allocated the company 300,000 hectares of land, of which it has said it plans to develop at least 100,000 hectares into industrial palm oil plantations by 2019. If Olam’s project is completed, McKinsey & Company estimates that it will be Africa’s biggest palm oil plantation.

A study by the Rainforest Foundation UK found that of the three lots that make up the first 52,000 hectares identified for palm oil development, two are entirely within Ramsar-listed wetlands where endangered manatees live. A large part of the third lot was found to be home to endangered chimpanzees and elephants. Olam gave the first two lots back to the government after deeming them unsuitable for development, and has committed not to clear the high conservation value areas in the third lot, but the company has not announced independent third-party monitoring.

Overall, Olam’s forest protection policy lags significantly behind almost all the other major traders. Instead of using the standard definition of High Carbon Stock forests developed by TFT, Greenpeace, and GAR, Olam only says it defines HCS through a vague “multi-stakeholder process in the country of origin.” In addition, Olam’s policy does not apply to its third-party suppliers of palm oil.

POLICY

1.A

The company has a forest policy for palm oil produced, traded or processed that applies to its global operations including all subsidiaries and joint ventures. The company also requires its suppliers to follow the policy.

YES

1.B

The policy excludes the sourcing of  raw materials or products originating from natural forests including both primary and secondary forests.

NO

1.C

The policy specifically excludes the sourcing of raw materials or products originating from High conservation Value (HCV) areas.

YES

1.D

The palm oil policy specifically excludes development on peat soil regardless of depth.

HALF

1.E

The palm oil policy excludes the sourcing  of raw materials and products from developments in High Carbon Stock (HCS) Forests.

YES

1.F

The palm oil policy excludes the sourcing of raw materials and products from lands where burning has been used to clear vegetation.

YES

1.G

The company has pledged to use (or uses) a third party for compliance verification of its policy.

NO

1.H

The company has developed and published a non-compliance procedure that outlines thresholds for the suspension and/or cancellation of contracts with suppliers in breach of the policy.

NO

1.I

The company has committed to developing a traceability system that documents palm oil back to the plantation of origin within its entire supply chain.

HALF

1.J

The company specifically commits (and requires its suppliers to do so) to respect the rights of Indigenous and local communities to give or withhold their Free, Prior and Informed Consent (FPIC) to development on their lands.

YES

1.K

The company has programs that support small holders in its supply chain with support that goes beyond purely financial considerations and the palm oil supply chain but addresses longer term development.

YES

1.L

The company has policy to reduce the environmental and health impacts of chemical pesticides and/or fertilizers.

NO

IMPLEMENTATION & TRANSPARENCY

2.A

Date by which the company aims to achieve full traceability to plantation for its entire supply chain.

NO

2.B

The company or the relevant third party publishes detailed processes and results of the policy verification assessments.

NO

2.C

The company has established and published an accessible and transparent grievance and dispute resolution mechanism.

NO

2.D

The company reports on its progress towards meeting its policy goals at least annually against measurable indicators.

NO

2.E

The company has published the  names or  detailed locations (that allow for coordinates to be obtained) of all palm oil mills in its supply chain.

NO

3.A

Points are deducted for the following (occurring since January 1, 2015). There is public evidence that since January 1, 2015 the company has in its own operations not met criteria 1.C, 1.D, 1.E or 1.J (or uses palm oil from protected areas). Or the company has sourced from suppliers that have not met these criteria. Or the company had its RSPO license revoked or suspended since that date. Or there is evidence of significant workers rights violations or social conflicts.

NO

See all of the rankings of major palm oil and soy companies on their adherence to forest conservation requirements on the Green Tiger and Green Jaguar index.