Palm oil is a vegetable oil obtained from the fruit of the palm tree. It is the most widely used vegetable oil on Earth. Most of the palm oil used by Fazer is in vegetable oil mixtures. We use palm oil based fats in the production of laminated coffee breads, biscuits and in some confectionery fillings.
Palm oil has very good technological properties which has made it a highly suitable ingredient in the food industry replacing the use of transfatts. It is also highly productive, and requires relatively less land than any other crop to produce oil. Growing palm oil has been a source of economic growth for many countries such as Indonesia and Malaysia offering employment opportunities for communities.
With the rapid expansion of the palm oil industry the environmental and social challenges associated with the palm oil industry has become evident. There has been a lively discussion and a variety of concerns among consumers and other stakeholders regarding the sustainability of palm oil production.
The use of palm oil as such is not harmful. What makes a difference is the way palm oil is produced. When produced irresponsibly, clearing excessive amounts of land for palm oil plantations can lead to loss of rain forests, destroy habitats for endangered species, accelerate climate change, and cause social problems through loss of land and livelihoods.
Responsible and transparent sourcing of palm oil can be supported by following the requirements of the Roundtable on Sustainable Palm Oil (RSPO), a global, multi-stakeholder initiative on sustainable palm oil, established to tackle the challenges related to palm oil production. As a member of the RSPO we are committed to supporting responsible sourcing of palm oil.
Fazer Group’s Commitment to Responsible Palm Oil
In 2014 Fazer made a committed to source 100% RSPO certified sustainable palm oil with increased traceability by 2020. With increased traceability we mean that we shall aim for improved traceability by complying with the following supply chain option hierarchy:
- Segregated supply chain system
- Mass balance supply chain system if segregated palm oil is not available taking availability, quality and market conditions into account
- Book & Claim / GreenPalm certificates in the most complex palm oil derivatives that are not available as segregated or mass balance.
Segregated palm oil is certified palm oil kept separate from non-certified palm oil throughout the value chain, but that is mixed with certified palm oil from other origins. Mass Balance is a blend of certified and non-certified palm oil. Book and claim (Green Palm Certificates) means that for every tonne of palm oil we use in the production of our products, we have paid a voluntary premium to a palm oil producer operating within RSPO guidelines for social and environmental responsibility. The benefit of this is that the premium reaches even the small growers. However the physical palm oil we receive on delivery is uncertified.
Fazer will purchase 100% RSPO segregated palm oil for those confectionery products containing palm oil by 2016. In 2018 all Fazer’s palm oil will be RSPO segregated in Finland, Sweden, Norway, Denmark and Baltic countries. For those quantities that cannot be sourced segregated or as mass balance we will continue to but Green Palm certificates. Read more about our palm oil commitment here.
On WWF’s palm oil ranking list for 2013, Fazer’s rank was one of the two highest ranking Finnish companies, receiving eleven out of twelve points.
On WWF’s palm oil ranking list for 2013, Fazer received eleven out of twelve point. Fazer's rank was one of the two highest ranking among Finnish companies. The ranking was based on the amount of RSPO certified palm oil used and goals to increase the use of sustainable palm oil. In 2012 and 2013, a full 100% of Fazer’s palm oil was covered by GreenPalm certificates.
As a part of our commitment, we have also committed to develop a policy to protect biodiversity, prevent deforestation and take into consideration greenhouse gas emissions in our palm oil supply chain. During 2014–2017, we will collaborate with WWF Finland to improve our environmental performance, focusing on protecting biodiversity. Additionally we will also have an open dialogue and work in close co-operation with our suppliers, NGOs and other palm oil stakeholders to better manage our environmental impacts and to develop traceability in the palm oil supply chain.