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Supply Chain Transformation

Supply Chain Overview

Our Supplier Guidelines outline the basic principles that we expect all our suppliers to uphold. They cover topics such as legal compliance and business integrity, labour and human rights, environmental protection, product quality and safety and reporting violations or misconduct. In turn, our suppliers are expected to communicate and implement the principles in our Supplier Guidelines throughout their own supply chains.

We have an extensive responsible sourcing programme to help our suppliers build capacity and meet the standards set out in our Supplier Guidelines. With strong roots in palm oil and sugar, we are particularly focused on the responsible sourcing of these two commodities through knowledge-sharing and on the ground interventions.

 

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ART is dependent on mapping all the mills supplying the refinery, as well as their FFB sources, where possible. Currently, the ART programme only focuses on Wilmar's own refineries and all direct mills supplying our refineries.

For a mill to be considered traceable, we need to be able to record all critical information, including parent company name, mill name, address, GPS coordinates, and volumes supplied to Wilmar refineries. A minority of mills are categorised as untraceable. Untraceable does not imply we do not know who we buy from but instead means that the supplier does not fully meet our traceability criteria, (e.g. parent company/group affiliation or GPS coordinates).

The ART programme does not seek to equally engage all mills in the supply shed simultaneously. Instead it adopts a Mill Prioritisation Process using spatial and non-spatial information to prioritise and target higher risk mills in a vast supply shed for deep engagement. Assessments will be carried out on the 10% high priority mills.

Spatial data is captured using GIS data overlaid with information from Global Forest Watch and Forest Monitoring for Action (FORMA) alerts. It includes legally protected areas, key biodiversity areas and peat soil areas as documented by an international body.

Non-spatial factors focus on the known sustainability policy and performance of the mills, and include companies that have their own NDPE Policy and implementation plan, RSPO certification status, volume supply to the refinery and TFT’s assessment register.

Following the mill prioritisation process, field visits are undertaken, and practices are assessed against Wilmar’s NDPE Policy requirements. Importantly, these field visits are not driven by a certification agenda or an audit; rather the visits seek to build trust and engagement for mills by providing practical recommendations for the mill and their FFB suppliers to improve practices. The site visits are supported by Wilmar’s consultants together with our internal teams.

An initial discussion at headquarter level with key management is followed up by an assessment, which includes samples of the mill’s third-party FFB suppliers such as commercial plantations, smallholders, as well as fruit collection centres. A typical visit will take three to five days, and prior to finalising the assessment report, the assessment team will meet with the mill to discuss findings. Following these three steps, an overarching report is developed, summarising issues and recommendations without identifying particular mills or growers. This report serves as a medium to provide important information about trends of issues that require attention across the region/landscape

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Wilmar wants to reach out as extensively as possible to ensure that our entire supply chain is included in the ART process and will be able to receive support for ongoing improvement. This is done through broad-level engagement workshops and training which all the suppliers of a particular refinery are invited to attend.

Workshops share the work that has been done in that landscape and provide an overview of what common issues were found, as well as recommendations for addressing the issues. The workshop is also complemented by a series of training sessions open to all our suppliers, as well as to their FFB suppliers. Key stakeholders, including industry experts, government agencies and our customers have actively participated in the workshop and training sessions to directly engage with our suppliers.

Supplier Reporting Tool (SRT)

Engagement with our third-party suppliers is an important part of ensuring that our No Deforestation, No Peat, No Exploitation (NDPE) policy is implemented effectively. To enable better assessment of our suppliers’ progress and their implementation of the NDPE policy, we have developed and launched the Supplier Reporting Tool (SRT) in 2017. The SRT is an online self-reporting tool that is hosted on the OnConnect system to allow suppliers to report their current compliance to environmental and social risk-related issues within our supply chain.