Palm NDPE Implementation Annual Report 2024 A
WE THRIVE
TOGETHER
PALM NDPE
IMPLEMENTATION ANNU AL REPOR T 2024
B Wilmar International Limited
Palm NDPE Implementation Annual Report 2024 1
CONTENTS
An aerial shot of one of our oil palm plantations, Oil Palm Uganda Limited, in Africa.
Summary of Progress
Introduction Global Context
Commitment to No Deforestation, No Peat, No Exploitation
About this Report
02
04
04
04
05
NDPE IMPLEMENTATION
Traceability
Traceability to Mill (TtM)
Traceability to Plantation (TtP)
Our Key Programmes in Ensuring Supplier Compliance
Satellite Monitoring
Supplier Compliance and Due Diligence
Due Diligence for Potential New Suppliers
Assessing Existing Suppliers through Supplier Reporting Tool
Ongoing Engagement with Suppliers
Grievance Mechanism
06
06
08
09
09
10
10
11
13
15
IMPLEMENTATION OF
"NO DEFORESTATION" AND "NO PEAT"
NDPE Implementation Reporting Framework Improving Understanding and Protection of
High Conservation Value-High Carbon Stock Areas
Minimising Risk of Fires in Plantations Landscape and Jurisdictional Approaches
18
21
22
22
IMPLEMENTATION OF "NO EXPLOITATION"
No Exploitation Protocol
Our Human Rights Due Diligence Approach Living Wage
Partnerships and Platforms Smallholders
Smallholder Programmes
26
27
28
28
29
29
APPENDIX
External Assurance from Control Union Certification Agriculture Sectoral Roadmap to 1.5-degree Celsius: Palm Oil Sectoral Roadmap Commitment Index
30
32
2 Wilmar International Limited Palm NDPE Implementation Annual Report 2024 3
SUMMARY OF PROGRESS
* Limited assurance conducted by CU. * Limited assurance conducted by CU.
Other palm producing countries include Brazil, Cameroon, Colombia, Costa Rica, Democratic Republic of the Congo, India, Ghana, Guatemala, Honduras, Ivory Coast, Liberia, Mexico, Nicaragua, Nigeria, Papua New Guinea, Sao Tome and Principe, Sierra Leone, Solomon Islands, Sri Lanka and Thailand.
Wilmar's Sapi plantation located in Sabah, Malaysia.
>23.1*
1,018*
SUPPLIER GROUPS MONITORED
7,921*
PLANTATION UNITS MONITORED
SATELLITE MONITORING
MILLION HECTARES (HA)
of land covered by satellite monitoring in Indonesia, Malaysia and other palm-producing countries1
87 GRIEVANCE CASES
3
GRIEVANCE CASES
as of December 2024
CASES IN PROGRESS
84
CASES CLOSED
906* (98.8%)
917*
SUPPLIERS ASSESSED AS LOW-PRIORITY MILLS
SUPPLIER ENGAGEMENT
(100%)
SUPPLIERS ASSESSED
11 (1.2%)
*
11 (100%)
*
SUPPLIERS ASSESSED AS
HIGH-PRIORITY MILLS
high-priority mills engaged
(e.g. field visit, improvement plan follow-up, meeting, email correspondence, etc.)
1,047
SUPPLIERS TRAINED ON NDPE IMPLEMENTATION SINCE 2015
TRACEABLE TO MILL
98.5%*
26.0*
MILLION MT OF PRODUCTS
TRACEABILITY
91.0%*
TRACEABLE
TO PLANTATION
24.0*
MILLION MT OF PRODUCTS
DELIVERING ON NDPE IMPLEMENTATION REPORTING FRAMEWORK (NDPE IRF)
95.9%*
OF PALM AND LAURIC PRODUCT VOLUMES ACROSS WILMAR'S GLOBAL SUPPLY CHAIN
have achieved "Delivering" status for both No Deforestation and No Peat requirements using the NDPE IRF
34
SUPPLIER GROUPS SUSPENDED SINCE 2015
2.6
10
MILLION HA
oil palm plantations removed from our supply chain due to suspension since 2015
APPROACH TO SUPPLIER
NON-COMPLIANCE
SUPPLIER GROUPS REMAIN ON OUR
SUSPENSION LIST
(covering 1.3 million ha of oil palm plantations)
24
SUPPLIER GROUPS
(covering 1.3 million ha of oil palm plantations) met Wilmar's reentry criteria
SUPPLIER GROUPS
have been suspended since the introduction of our "suspend first" approach effective 2019
12
4 Wilmar International Limited Palm NDPE Implementation Annual Report 2024 5
INTRODUCTION
A plantation worker in Sabahmas Plantation, Malaysia, applying best field and harvesting practices.
Global Context
Palm oil is a highly versatile and efficient oil crop, capable of producing more oil per hectare (ha) than alternative oilseeds almost all year round. This helps meet the ever-growing global demand for food, personal care products, biofuels and more. Beyond its commercial value, palm oil is a vital source of income for millions of farmers, workers and communities worldwide.
At the same time, we recognise the environmental and social challenges associated with palm oil production such as deforestation, biodiversity loss and exploitation risks. However, these issues can be effectively managed with responsible practices.
Traceability remains a key focus, serving as an important first step in mapping our supply to specific palm oil mills and eventually to plantations, enabling us to evaluate suppliers' performance against our NDPE Policy.
Beyond continually bolstering our supplier monitoring, we proactively identify and assess high-risk suppliers and work with them to improve their operations. When compliance issues arise, we take decisive action which may include removing non-compliant suppliers from our supply chain.
Industry-wide efforts such as the Agriculture Sector Roadmap to 1.5-degree Celsius, launched at COP27 in 2022, have demonstrated the value of collective action in reducing deforestation and mitigating climate impacts. Studies have also highlighted tangible benefits from NDPE commitments, such as a significant slowdown in deforestation in key regions and the preservation of millions of hectares of forestland.
Sustainability is at the core of our operations, guided by our No Deforestation, No Peat, No Exploitation (NDPE) commitment since 2013. We continuously strengthen our efforts in addressing potential challenges, invest in traceability, work with farmers on sustainable practices as well as champion human and labour rights. At Wilmar, our mission is to produce palm oil responsibly, balancing the needs of people and nature.
Commitment to No Deforestation, No Peat, No Exploitation
Our NDPE Policy has been a cornerstone of our sustainability approach since 2013. Wilmar was the first in the industry to adopt a NDPE commitment that extended beyond our own operations to include joint ventures, regardless of shareholding, and third-party suppliers. Over the years, we have strengthened our commitment, refining policies and procedures to address emerging challenges and lead the development of best NDPE practices in the industry.
The European Union Deforestation Regulation
As part of our commitment to deforestation-free practices, we closely monitor our operations and third-party suppliers at the group level2using satellite monitoring. Verified cases of deforestation or new peatland development result in immediate group-level suspension, in line with our "suspend first" approach. This aligns with our broader NDPE Policy and extends to conserving biodiversity across our operations and supply chain.
We welcome and support the EUDR as a crucial step in encouraging the consumption of deforestation-free products and addressing global deforestation and forest degradation.
Throughout 2024, we actively engaged with European Union authorities and industry associations to share our knowledge, experiences, challenges, concerns, and recommendations on the implementation of the regulation. This engagement allowed us to contribute valuable insights and have our perspectives considered in the regulatory process.
In addition, we actively engaged with our suppliers, who play a crucial role in making sustainable agriculture and food production a reality. By working closely with them, we aim to promote sustainable practices, improve transparency and support the collective goal of building a more sustainable and responsible supply chain.
Wilmar has adopted the RSPO's definition of "group".
About This Report
Our goal is to achieve a supply chain free of deforestation, peatland degradation and social exploitation. Achieving this requires transparency, accountability and collaboration across all levels. 2024 marked the 11thyear of implementing NDPE, reinforcing our long-term dedication to responsible palm oil production.
We continue to closely monitor and manage our suppliers on their compliance with our NDPE Policy, actively engaging them through training and raising awareness on our NDPE expectations. Existing suppliers undergo assessments where relevant and necessary, while all new suppliers are subjected to a rigorous due diligence process. This allows us to incrementally transform our supply chain to improve traceability and alignment with our sustainability goals.
Wilmar adopts a data-driven approach, consistently aiming to
deliver the highest levels of clarity, accuracy, and transparency in the data and information we disclose.
This Report provides up-to-date progress relating to certification, conservation, supply chain monitoring, NDPE compliance, grievances and traceability. It contains data and information from the financial year from 1 January 2024 to 31 December 2024 and may reference events in previous years, where relevant.
This Report should be read together with our Annual Report 2024 and Sustainability Report 2024 as an integrated suite of reporting materials. More information can also be found on our Sustainability Dashboard.
Material palm disclosures such as traceability to mill and
plantation data, satellite monitoring efforts and the NDPE IRF disclosures, amongst others, have been assured by Control Union Certifications (CU). Other material ESG disclosures have been externally assured by Ernst and Young (EY). For details on the assurance from CU, please refer to pages 30 to 31 of this Report. For details on external assurance from EY, please refer to pages 164 to 165 of our Sustainability Report 2024.
In line with SGX's sustainability reporting requirements, Wilmar's external assurance covers all key aspects of Wilmar's sustainability disclosures. Based on this approach, no further internal review has been conducted, as determined by Wilmar's internal assessment.
6 Wilmar International Limited Palm NDPE Implementation Annual Report 2024 7
NDPE IMPLEMENTATION
Traceability
The palm oil supply chain is complex, spanning millions of smallholders to large corporations. Today, more than seven million smallholders3around the world make a living from oil palm and contribute about 35.0% to 40.0% of global palm oil supply. In major producing countries such as Indonesia, the supply chain consists of a network of small-scale growers and intermediaries. While each plays a crucial role, they contribute to the industry's fragmented nature. Tracking the journey of palm oil from these smallholders to global markets is particularly challenging due to the complex network of growers, agents, and intermediaries.
As Wilmar sources over 90.0% of our palm oil from third-party suppliers, traceability goes beyond being a logistical requirement-it is a crucial step towards enhanced sustainability. Mapping the supply chain back to the mills and eventually to plantations ensures the enforcement of vital policies like our NDPE Policy. Beyond compliance, traceability also enables us to provide targeted support to smallholders to improve their practices and yields while safeguarding the environment and communities.
As the world's largest palm oil trader, Wilmar recognises that supply chain transformation presents both a significant challenge and an immense opportunity to driving meaningful change.
Traceability to Mill
To manage risks in our supply chain, understanding the origin of our raw materials is essential. Wilmar is committed to achieving a fully traceable and transparent supply chain, initially setting the goal of 100% traceability to mill (TtM) for all volumes handled by our refineries by 2015.
While significant progress has been made over the years, achieving full transparency remains a challenge, especially within the intricate systems of commodity transportation and trade, particularly in markets like China and India. As of December 2024, we have achieved 98.5%* TtM for crude palm oil (CPO) and palm kernel oil (PKO), representing approximately
26.0* million MT of palm and lauric products traceable to mill across our global operations.
Closing the gap to 100% TtM requires close collaboration with our suppliers and the implementation of robust processes to address systemic challenges. We remain firmly committed to achieving this goal and have revised our target of full traceability to palm oil mill by 2025.
Our approach to full traceability involves requesting detailed traceability information for volumes received from third-party refiners, traders and bulkers. Wilmar's Sustainability Department then consistently monitors supplier data to ensure compliance with our NDPE Policy. In addition, our procurement practices prioritise sourcing from suppliers who provide clear visibility into the origin of their products, reinforcing responsible sourcing across our entire supply chain.
* Limited assurance conducted by CU.
ACHIEVED
98.5%*
(26.0* MILLION MT)
TtM For Palm And Lauric Products Across Our Global Operations
* Limited assurance conducted by CU.
https://rspo.org/as-a-smallholder/
A worker in one of our mills in Sapi Plantation located in Sabah, Malaysia.
| Attention: This is an excerpt of the original content. To continue reading it, access the original document here. |