Unilever cancels palm oil purchase deal

London – Unilever has suspended all future purchases of palm oil from Indonesian company PT SMART, part of the Sinar Mas group, until it provides verifiable proof that none of its plantations contribute to the destruction of high conservation value forests and expanding onto peat lands.

For the past 18 months Unilever, a large user of palm oil, has been scrutinising the activities of its suppliers to ensure that they meet the highest possible sustainability standards. Early in 2009 the company also conducted an independent audit of its major suppliers, which identified several areas of concern.

While these issues are being addressed on an individual basis, Unilever said new evidence has come to light in the form of a Greenpeace report that, it said, makes “serious allegations” against Sinar Mas’s environmental practices.

“The Greenpeace claims are of a nature that we can’t ignore,” Marc Engel, Unilever chief procurement officer. “Unilever is committed to sustainable sourcing. Therefore, we have notified PT SMART that we have no choice but to suspend our future purchasing of palm oil. If PT SMART are able to come forward with concrete proof that they are not involved in unacceptable environmental practices then we would certainly re-consider our position.”