Nestle Update on Palm Oil and Deforestation

sent to a supporter.
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Dear Consumer

You have, in the past written to us with regard to palm oil and we thought you would like to know that as a further step in its commitment to fight the major issue of deforestation, Nestlé has entered into a partnership with The Forest Trust (TFT). TFT, a global non-profit organisation with expertise in responsible sourcing, will help Nestlé enhance its commitment to responsible supply chains, by identifying and addressing threats to forest conservation.

Nestlé is the first global consumer goods company to become a TFT member. We want our purchasing power to act as a force for forest conservation.

The partnership will start with palm oil. We are determined to identify any companies that own or manage plantations or farms linked to deforestation, and where we identify them, we will exclude them from our supply chain.

Working with TFT, we have developed a set of Responsible Sourcing Guidelines that will guide Nestlé's palm oil procurement process. These demand that our purchases will:

a) Be derived from plantations and farms operating in compliance with local laws and regulations
b) Protect high conservation value forest areas
c) Support the free prior and informed consent of indigenous and local communities to activities on their customary lands where plantations are developed
d) Protect peatlands
e) Protect forest areas of ‘high carbon’ value

The partnership with TFT will therefore focus on assessing suppliers' performance in relation to these requirements. Where suppliers do not meet these criteria, but are committed to achieving sustainability, the partnership will provide the technical assistance they need to improve their practices. We will also identify new suppliers who comply with the guidelines (or could comply with the right technical assistance).

This is the latest step on our sustainable sourcing journey, building on our aim to use 100% sustainable palm oil by 2015. We are tracking progress carefully, and this year, 18% of our palm oil purchases will come from sustainable sources. We expect this to rise to 50% by the end of 2011.

While we do not use a huge volume of palm oil (0,7% of total palm oil production) compared with other companies, we hope that by focusing on sustainable solutions, we will inspire other companies around the world to follow suit - ensuring that the producers take responsibility for what happens along the entirety of the supply chain.

And this is just the beginning of our partnership with TFT – we will study our supply chains to identify a similarly ambitious plan for the pulp and paper we use.

Greenpeace has welcomed the move, describing it as “a very positive step”.

Thank you again for taking the trouble to contact us. We are grateful for the interest you have shown in our company.

Lynne Fearnley
Consumer Relations Officer
Consumer Services