Global Canopy has released its 2019 Forest 500 report, in which the not-for-profit assesses the most ‘influential’ businesses in forest-risk supply chains.
According to the Global Canopy’s findings, 140 (40%) of the most influential companies in forest-risk supply chains still do not have any deforestation commitments, and 75 (21%) companies have commitments for just one of the commodities they source or produce, but not for the others.
Further, of the 157 companies which previously had commitments to remove deforestation by 2020 or earlier, seven have removed their commitment completely, and 18 have removed the deadline from their commitments since 2018, noted the report.
However, some food companies have suggested inaccuracies in Global Canopy’s report, including confectionery giant Mars.
Mars contests Forest 500 calculation
“As 2020 approaches, some companies are starting to go backwards,” noted Global Canopy in the 2019 report.
Global Canopy: How companies score points
Companies are assessed on publicly available information on their commitments to tackle commodity driven deforestation and their implementation of those commitments.
Scores are calculated out of 100 according to a company’s overall approach, commitment strength, reporting and implementation, and social considerations.
Here, the NGO refers to a list of ‘high profile’ companies which dropped in score due to the removal of commitments since 2018. Mars achieved a score of 69% in 2018 yet in Global Canopy’s original 2019 report, dropped -6% in 2019 to 63%.
According to Global Canopy, the drop was attributed to Mars removing “deadlines from its traceability commitments on palm oil and soya, and [failing] to update the deadline for its commitment on pulp and paper”.
Mars, however, demonstrated there were ‘errors’ in how its score was calculated. “Mars should not have been included among the ‘going backwards’ list of companies,” a Mars spokesperson told FoodNavigator.
“In short, we have not removed commitments to soy and palm, and, in fact, we have deepened our approaches to ending deforestation in a number of our supply chains – made clear by our Palm Positive plan, which was made publicly available in Sept. 2019.”
The company has committed to deforestation-free soy, beef and cocoa supply chains by 2025, and aims to deliver deforestation-free palm oil by the end of 2020.
With regards to Mars’ pulp and paper supply chain, the firm is maximising the use of recycled fibre where possible. When virgin fibre is used, Mars is committed to forest management certification or equivalent verification by 2025, we were told.
“We have invested significantly in providing greater traceability and transparency on each of the five raw material supply chains mentioned to better identify and define deforestation and conversion risks and understand sourcing origins, which we believe is a necessary step in effectively addressing deforestation,” the spokesperson continued.
“We’re in the process of updating our other raw material action plans, which will be posted this quarter.”
Global Canopy has acknowledged the mistake and updated its report. “We have been informed that there was an error in the Global Canopy Forest 500 report and Mars should not have been included in the list of companies that have removed their commitments and has not weakened its soy commitment, which was stated on page 14 of the embargoed report,” noted the NGO.
‘Laggards and low scorers’ hit back
Maker of probiotic milk drinks, Yakult Honsha Ltd., also features in the report’s list of companies ‘going backwards’ and dropping commitments.
In the 2018 Forest 500 report, the company scored 7% . In 2019, Yakult Honsha dropped -4% to 3% for removing “deforestation commitment for pulp and paper from their 2018 CSR report”.
Following up with the dairy major, a company spokesperson told FoodNavigator ‘Yakult’s environmental policy has not changed’ and that the company is ‘committed to the preservation of the environment’.
“This includes the use of certified paper in our products. As we continue this commitment, we will also work to improve the disclosure of information related to these efforts.”
French dairy company Groupe Lactalis, which owns brands such as Président, Siggi’s Dairy, and Rachel’s Organic, has also responded to Global Canopy’s findings.
In the report, the NGO lists Lactalis in the ‘laggards and low scorers’ category. With a score of 0%, Global Canopy suggests Lactalis’ sole deforestation pledge is a commitment to increase the proportion of recycled paper in its packaging.
Group Director for Public Affairs and Sustainability, Axel Bigot, told this publication that Lactalis Group ‘fully endorses’ sustainability and has developed ‘several action plans’ to prevent deforestation.
Concerning ingredient purchases, the company has developed a policy to gradually switch palm oil and palm oil derivative volumes into mass balance or segregated Roundtable on Sustainable Palm Oil (RSPO)-certified volumes in countries including France, Canada, Mexico, Brazil, Colombia, Turkey, Algeria, Poland, the Czech Republic, and South Africa.
“This policy allowed us to grow from 30% RSPO-certified volumes in 2016 up to 57% in 2019,” said Bigot.
Lactalis has also developed initiatives to switch volumes of carton packaging to FSC-certification and told this publication it is also taking actions to prevent indirect deforestation.
“We recently updated our Supplier Charter with additions related to the supplier’s obligation to prevent deforestation in its own supply chain. Suppliers are being audited regularly to control compliance with the Charter.”
Together with initiatives concerning indirect deforestation stemming from raw milk production at the farm level, Bigot told us the Lactalis Group “commits itself into actions contributing to prevent deforestation”.
Challenges in sustainability reporting
Global Canopy’s error draws attention to challenges faced in sustainability reporting. Mars, too, suggested that such ‘large scale’ exercises can be complex undertakings.
“We understand these large scale data collection exercises are challenging and appreciate Forest 500's efforts to address the issue quickly,” the company spokesperson told this publication.
Oliver Nieburg, market analyst for Lumina Intelligence Sustainability (the insight platform owned by FoodNavigator’s publisher, William Reed Business Media) and the host of the Sustainable Food & Drink Podcast, agrees.
“Scoring – whether to highlight laggards or to reward high achievers in sustainability – is complex and often measured by subjective weighting.
“It’s important for industry to demonstrate impact and for NGOs to hold companies accountable on sustainability. But collectively we need a universal path for a crop to be deforestation-free and an agreed definition of ‘sustainability’,” Nieburg told FoodNavigator.
“Does it only mean it’s traceability? And traceable to what degree - to a processing plant or to farm gate? Is mass balance or only identity-preserved acceptable? Does it mean a living income for farmers? Should the crop be grown in an agroforestry system? Is buying third-party certified volumes enough?” – Oliver Nieburg, market analyst, Lumina Intelligence Sustainability
The report recommends due-diligence legislation, which report author Sarah Rogerson suggests could speed up progress. To date, overall progress has been ‘painfully slow’, she said.
“Pressure from governments, particularly mandatory requirements, would help to bring up the laggards (those which currently have no commitment or any action on deforestation) and level the playing field between them and the leaders that have been investing resources into tackling deforestation,” she told this publication.
“This could help to drive sector-wide action which is what is needed to eliminate deforestation on a global scale.”
For Lumina Intelligence’s Nieburg, a legal requirement for due diligence should define what it means to be ‘deforestation-free’. “Regulation could also propose standardised reporting templates and comparable metrics,” he said.
“It’s a tough task to keep pace with ever-changing industry pledges. Reporting is not standardised and definitions vary widely. A deforestation commitment – and progress to that commitment - can be embedded in an annual report, spread across multiple pages of a company websites or strewn across press releases from different divisions of a single company.
“A commitment to a company sustainability programme for example, can be communicated as a percentage of total volumes, a monetary commitment in dollars or a volume commitment in tonnes and may be limited to select countries. A company may later ditch a commitment, but replace it with something else and it’s open to interpretation how effective you view the new approach. The CSR landscape is riddled with grey areas making it very challenging to holistically assess if a company is sustainable. This will be easier with a legislative level playing field for all.”