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Palm giants ask Indonesian gov't to clear path toward sustainability

May 1, 2015

Palm giants ask Indonesian gov't to clear path toward sustainability

Philip Jacobson
May 01, 2015

Executives from palm oil giants Wilmar, Cargill and Golden Agri-Resources (GAR) appeared at a green investment summit in Jakarta this week, providing a window into the nature of a high-profile, joint sustainability pact the companies have entered into together with Asian Agri, Musim Mas and the Indonesian Chamber of Commerce and Industry (Kadin).

The agreement, known as the Indonesia Palm Oil Pledge (IPOP), has been lauded in some quarters for its potential to transform the sector, a major driver of the country's sky-high deforestation rate, and dismissed in others as mere lip service to protecting the environment.

Despite the IPOP firms' control of at least four fifths of global palm-oil refining capacity, questions remain about how much influence they can exert over their vast, often opaque supplier networks.

"These are complicated, fragmented supply chains, so a lot of these buyers – and they'll admit it – they don't know who they're buying from," Andrew Bovarnick, the head of the United Nations Development Programme's (UNDP) global Green Commodities' Program, told Mongabay on the sidelines of the Tropical Landscapes Summit on Tuesday.

Antitrust concerns also loom over the pledge, with some from among the companies suggesting they might not be able to cooperate to the extent necessary to realize their ambitious goals.

Asked if he was worried about violating competition guidelines, perhaps via a collective blacklist of problematic suppliers, Wilmar's chief sustainability officer, Jeremy Goon, answered, "Yes. And if someone wants to come up with an issue with that, they can. … Of course there are concerns."

Read more at Mongabay.com.

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