Palm oil

Reducing deforestation and improving livelihoods

We are concerned about the palm oil supply chain and its impact on the environment, workers, and communities. Palm oil expansion has contributed to deforestation and climate change, as well as other negative impacts on biodiversity, endangered species, the human rights of workers and communities, and the broader environment.

And despite being a highly productive crop that can offer a path out of poverty, unsustainable palm oil production practices can also threaten the rights of rural communities and indigenous peoples.

In 2010, we made a commitment to source 100% of our palm oil from responsible and sustainable sources. This goal was achieved in 2015 through the purchase of RSPO certified volumes and we have continued to maintain that performance year on year.

Since 2014, we have evolved our sustainable palm sourcing activities reflecting the need to enhance our response to the complex sustainability challenges facing the sector. This began with our first statement on sustainable palm sourcing (2014) and was followed by the introduction of an annual supplier engagement process designed to evaluate the progress of our direct palm suppliers in meeting the principles set out in our policy.

In this update to our Statement on Responsible Palm Oil Sourcing we wanted to take this opportunity to highlight to our stakeholders' recent progress areas including:

• Updated Palm Oil Policy and Statement (2022)
• Consumer Goods Forum Forest Positive Coalition of Action
• Ongoing supplier engagement and performance reporting
• Status of RSPO certified volumes and traceability
• Enhanced supply chain transparency
• Internal Grievance Process & public tracker
• Smallholder program in Aceh Singkil region

Palm Oil Policy (2022)

Our 2022 updated statement on Palm Oil Sourcing strengthened the principles we expect of direct suppliers and ensured that they are in line with industry best-practice. Specific revisions to our policy and clarified expectations of our supply base include:

• Application of the integrated High Carbon Stock Approach (HCS)
• No burning for new plantations or replanting
• Progressive reductions of greenhouse gas emission
• Compliance with the General Mills Supplier Code of Conduct and Policy on Human Rights
• Measures to ensure inclusion of smallholders in the supply chain

As of December 2022, 98% of our supplier volumes were covered by a public No deforestation, No peat and No exploitation (NDPE) policy aligned with our sourcing expectations.

Critically, General Mills is now more actively engaging its suppliers in direct review of their palm oil production and sourcing practices, more detail of which can be found in section 3.

Consumer Goods Forum (CGF) Forest Positive Coalition of Action

General Mills is a founding member of the CGF Forest Positive Coalition of Action, formally launched in September 2020, which requires member companies to collaboratively work towards a forest positive future, and proactively work with suppliers to mainstream deforestation free production across their business. Click here to view more on the Forest Positive Coalition of Action. Within this membership, we have shared our membership with our direct suppliers.

As part of our effort to advance progress here, General Mills has also joined the No-deforestation, No-peat and No-exploitation Implementation Reporting Framework (NDPE-IRF) active working group – a reporting tool designed to help companies understand and track progress in delivering NDPE commitments, including deforestation-free supply chains.

Supplier engagement

As a downstream buyer, General Mills’ most important mechanism to drive sustainability performance, and compliance with our policy commitments, is through engagement with our direct suppliers.

Supplier evaluation
In 2017, with support from Proforest, General Mills began actively engaging its direct suppliers in review of their level of alignment with, and progress in implementing, our sustainable sourcing principles. The aim is to build an accurate picture of how our suppliers are performing and where there may be gaps or opportunities for improvement. This information is then fed into our annual supplier review process.

As part of our membership of the CGF Forest Positive Coalition, we are working to ensure our supplier engagement, performance tracking and reporting aligns with the requirements of the CGF FPC Palm Roadmap. This includes ensuring our suppliers are assessed on their performance against the CGF’s ‘Forest Positive Approach’. In 2023, we will continue to make explicit to our suppliers our expectations in this regard.

Highlighted KPIs from our 2022 supplier assessment include:

• 8 of our 9 suppliers (98% of volumes) have in place a public NDPE policy/commitment
• 8/9 suppliers (98% of volumes) have in place a mechanism to identify and respond to palm grievances
• 7/9 suppliers (96% of volumes) are supporting initiatives delivering forest positive development at landscape and/or sectoral level

Policy expectations – transparency and deforestation monitoring

General Mills’ expectations of its suppliers evolve over time in line with developments in our common understanding of what is needed to drive change in global palm oil supply chains. We periodically communicate these expectations to our direct suppliers as part of our engagement process.

• Mill lists: As noted below, we made public our global supplier mill list in 2018 and 8/9 of our direct suppliers (representing 96% of our volumes) have done the same. Our most recent mill list can be found on the side column.
• Deforestation monitoring: General Mills asks our direct suppliers to cover all palm oil concessions in our supply base with deforestation monitoring systems. As of 2022, 7/9 of our direct suppliers (96% of volumes) have deforestation monitoring systems in place for concessions.

Status of RSPO Certified Volumes and traceability

Our commitment to source 100% of our palm oil from responsible and sustainable sources was achieved in 2015 through the purchase of RSPO certified volumes. We have continued to maintain that performance year on year, including a purchasing shift toward mass balance and segregated oil and away from certificates.

Our aggregated purchasing volumes for 2022 are provided below. Mass balance and segregated volumes accounted for 99 percent of our 2022 purchases. In relation to traceability, 95.8% percent of our palm oil volume was categorized as traceable to the extraction mill, while further upstream, our traceability of FFB to known production (plantation) is 78%.

RSPO certified volumes above refer to purchased palm only. This information is not indicative of RSPO certification of any specific General Mills finished product. All General Mills finished products that are certified RSPO are certified under the Mass Balance supply chain model.

Enhanced supply chain transparency

We agree that supply chain transparency across the sector is a necessary requirement for effective monitoring, and in 2018 we made public our global supplier mill list and will continue to update this on an annual basis.

We are pleased to see that the majority of our direct suppliers have done the same and, where they haven’t, we will continue to encourage them to do so. In addition, we declare our list of direct palm oil suppliers, updated annually, as part of our commitment to supply chain transparency.

2022 General Mills global direct palm oil suppliers

AAK
ADM
Agropalma
Bunge Loders Croklaan
Cargill
Fuji
Shanghai Zhongwu/COFCO China
Soya Hellas
Stratas Foods

General Mills grievance process

In 2018, we received an increasing number of producer related grievances with alleged cases of non-compliance against our policy. To ensure the effective handling of these cases, we introduced an internal grievance management system which reflects best-practice in handling grievances (see grievance management process and public Palm Oil Grievance Tracker on sidebar).

As a brand owner and manufacturer which is often many times removed from the producer, we expect our direct suppliers to robustly manage their own supply chains to ensure palm volumes supplied to General Mills meet or exceed our standards. In cases where there is verified non-compliance with our policy, or where there is continued failure to remediate verified non-compliances in a timely manner, we take steps to remove those producers from our supply chain.

Smallholder Hub program in Aceh Singkil region

General Mills is currently engaged in a multi-year landscape initiative with Musim Mas Group in Aceh Singkil, Indonesia. The Smallholder Hub program is designed to integrate independent smallholders from villages neighboring the Leuser Ecosystem in Aceh Singkil, Sumatra, Indonesia, into the sustainable palm oil supply chain to reduce deforestation by building capacity and improving livelihoods. In consultation with non-governmental and private sector entities, this area was chosen due to its proximity to the protected forest, remote geography and subsequent ability to focus on multi-stakeholder goals of conservation and positive inclusion of smallholder farmers.

We recognize the opportunity for industry investment at origin in partnership with key upstream suppliers to support smallholders in addressing environmental, social and economic challenges, and we are now putting this into practice in the Aceh Singkil region. We are pleased to partner with Musim Mas focused on improving the economic security of smallholders and assisting them on their journey towards sustainable production, through collaboration with local government.

Financial investment from General Mills supports the capacity building of village extension officers who provide good agricultural practice, financial literacy and NDPE training and resources to smallholders.