SDG 12 - ENSURE SUSTAINABLE CONSUMPTION AND PRODUCTION PATTERNS

We were the first in the palm oil industry to launch an integrated NDPE Policy across our entire supply chain in 2013. In implementing the Policy, we work tirelessly with our supply base to understand the challenges and provide support to enable sustainable practices.

We trace supply flows from ports and refineries back to palm oil sources to map our supply base, evaluate suppliers’ performance against our NDPE policy, and engage with our suppliers to make improvements where needed.

Achieving full traceability has not been possible due to the ongoing challenges of commodity transportation and trading. In palm oil procurement and trading, the supply network to refineries is not limited to direct purchase of crude palm oil and/or palm kernels from mills. Refineries may also procure bulk and redistributed oil from third-party refiners or traders, in which case the mill origin may not be available.

For traceability to plantation, we disclose the fresh fruit bunches sourcing of our own mills in Malaysia on our sustainability dashboard.

The chart below illustrates the traceability status of Wilmar’s operations globally from October 2016 to September 2017.

We adopt the Aggregator Refinery Transformation (ART) approach to improve supplier compliance to our NDPE Policy and as part of risk management. Field assessments are conducted based on a selected sample of direct palm oil suppliers in a specific region. Results of these assessments are anonymised and consolidated into a wider generalised report that is shared with all suppliers in the region. The objective of ART is to provide a collaborative framework of solutions and shared best practices to overcome common issues faced by mills and growers in a region.

As of 2017, we have completed 69 assessments of mills in Indonesia, Malaysia, Latin America, and West Africa.

Certification is an important aspect in our sustainability endeavour and forms the basis for sustainable practices yielding improvements in efficiency and productivity.

As of 2017, 28 mills and more than 80% of our planted area across Malaysia, Indonesia and Ghana are RSPO-certified, producing about 880,000 MT and 190,000 MT of certified sustainable palm oil and palm kernels respectively.

For midstream and downstream operations, we have 56 sites certified against the RSPO Supply Chain Certification Scheme which are capable of delivering palm products under the Segregated and Mass Balance supply chain models.

We support the ISPO certification which is implemented by the Ministry of Agriculture to improve the competitiveness of Indonesian palm oil in global markets, meet the country’s commitment to reduce greenhouse gas (GHG) emissions and focus on environmental issues.

As of 2017, we have eight mills and their supply bases certified against the ISPO standard.

We are a member of the ISCC Association which seeks to establish an international, practical and transparent system for the certification of biomass and bioenergy. ISCC is oriented towards the reduction of GHG emissions, sustainable use of land, protection of natural biospheres and social sustainability.

As of 2017, we have 35 sites, covering the biodiesel supply chain, certified against the ISCC standard.

Smartcane BMP is a world-class best practice system for sugarcane growing in Australia, developed by industry researchers and sugarcane farmers based on productivity, profitability and sustainability. Smartcane BMP consists of seven modules covering key aspects of sugarcane growing.

Our sugarcane farming operations are progressively working towards accreditation of the Smartcane BMP core modules. As of 2017, over 80% of our sugarcane farm is accredited for the three core modules. To encourage early Smartcane BMP uptake by our suppliers, we offer growers a one-off financial incentive of 15 cents per tonne of cane when they obtain Smartcane BMP accreditation for all core modules.

Bonsucro is a global standard for responsible sugarcane production that is designed to create lasting value for people, communities, businesses, economies and eco-systems in all cane-growing areas. The Bonsucro Production Standard uses six principles to achieve sustainability in the production of sugarcane and its derived products, while the Bonsucro Chain of Custody Standard is concerned with the traceability of a product and adheres to five fundamental principles to ensure high performance and consistency.

As of 2017, about 54% of our sugarcane farm area as well as one raw sugar mill in Australia are certified against the Bonsucro Production Standard and Bonsucro Chain of Custody Standard. Another two mills and their supply bases in Australia have completed the certification audits in 2017 with certificates to be issued in 2018. Further down the supply chain, we have also obtained the Bonsucro Chain of Custody certification for all sugar refineries and warehouse operations in Australia and New Zealand, Jawamanis sugar refinery in Indonesia as well as the sugar trading office in Singapore.

We offer a one-off incentive of 10 cents per tonne of cane to growers who are eligible to be included in the Bonsucro certification process.