Sustainable agriculture means growing food in ways which sustain the soil, minimise water and fertiliser use, protect biodiversity and enhance farmers’ livelihoods.
Depending on the crop, sustainable farming has the potential to increase yields considerably. For the world to feed 9.5 billion people and mitigate the effects of climate change on agriculture, the widespread adoption of sustainable agriculture and elimination of deforestation is crucial.
70% of the world’s food is produced by smallholder farmers and three out of four people in developing countries depend on agriculture for their livelihoods. Supporting smallholder farming is the most effective way of stimulating economic development and reducing poverty, according to the World Bank.
So if we can help smallholders to adopt sustainable farming practices, it will help us secure future supplies of raw materials in developing and emerging markets from where much of our growth will come, help the world achieve food security and lift hundreds of thousands of smallholder farming families out of poverty.
As part of an overall review of our strategy we have taken the decision that, in addition to the large scale sustainable sourcing programmes we already have underway, from 2014 we will invest disproportionate effort in accelerating progress on two priorities through an explicit alignment of our business agenda with our partnerships and external advocacy agenda:
Working to eliminate deforestation from supply chains to help mitigate climate change - at a company level, at a consumer goods industry level and at a multi-sectoral level.
Championing sustainable agriculture and the development of smallholder farmers – driving transformational change in agricultural systems as a whole.
Unilever has been involved in sustainable agriculture since the mid-1990s. Since then we’ve achieved a number of milestones, including the development of our own Unilever Sustainable Agriculture Code, which we require all our suppliers to follow, and the development of a sustainable tea certification programme in partnership with Rainforest Alliance.
We are committed to sourcing 100% of our agricultural raw materials sustainably by 2020. Sustainable sourcing addresses a core business risk by ensuring security of supply and managing price volatility.
We focus on our top ten agricultural raw material groups, which account for around two thirds of our agricultural raw material volumes. We are also making progress with the responsible sourcing of our non-renewable materials, which make up about 50% of our total raw material purchases.
We will seek to go beyond ‘business as usual’ in considering the role we can play in attempting to drive transformational change.
Through the new commitments we have added to the Enhancing Livelihoods pillar of our Unilever Sustainable Living Plan, we are also aiming to improve the livelihoods of smallholder farmers, increase the participation of young entrepreneurs in our agricultural value chain and expand training and skills for women smallholders. We will also source 100% of our procurement spend from suppliers who commit to promote fundamental human rights in line with our new Responsible Sourcing Policy. See Enhancing Livelihoods.
Our progress in driving transformational change
We are committed to sourcing all our agricultural raw materials sustainably by 2020 and engaging with at least 500,000 smallholder farmers to improve their livelihoods. We have made strong progress against our target with 48% of all our agricultural raw materials coming from sustainable sources in 2013. In partnership with our suppliers we have reached 570,000 smallholders with help and training.
In addition to our own sustainable sourcing programmes which are already underway, in 2013 we have already started to make progress in driving wider transformational change across agricultural systems by:
Working to eliminate deforestation from supply chains
Developing a sustainable tea industry
Promoting sustainable agricultural systems with the Unilever Sustainable Agriculture Code
Driving change through continuous improvement policies with suppliers.
Driving change to eliminate deforestation from supply chains
Deforestation accounts for up to 15% of total global CO2 emissions. Just four commodities are major drivers of deforestation - palm oil, soy, beef, paper and pulp. We are determined to drive deforestation out of supply chains and are heavily involved in leading initiatives to make this happen - at a company level, at a consumer goods industry level and at a multi-sectoral level.
In our own company, we have achieved our target to source all our own palm oil from certified, sustainable sources, mainly through GreenPalm certificates. In 2013 we set a new and substantial milestone that all Unilever’s palm oil will be traceable to known sources by the end of 2014. This is a significant step towards our longer-term target to purchase all our palm oil sustainably from certified, traceable sources by 2020.
Strategic partnerships are key to our progress. These include Wilmar, the world’s largest palm oil trader, which makes up 35% of the world’s palm oil market. Its public commitment to sustainable palm oil is a significant step on the road to ending deforestation. In 2013 we signed a Memorandum of Understanding on palm oil with Wilmar to protect forests and communities.
At an industry level, Unilever obtained a commitment in 2010 to zero deforestation by 2020 by all 400 members of the Consumer Goods Forum (CGF). The CGF includes all the world’s major consumer goods manufacturers, retailers and service providers, with combined sales of €2.5 trillion. This has accelerated the efforts of CGF members.
At a multi-sectoral level, Unilever co-founded the Roundtable on Sustainable Palm Oil in 2004 and the Roundtable on Responsible Soy in 2006 and has led the foundation of the Tropical Forest Alliance (TFA), a public-private partnership between the CGF and the governments of the US, UK, the Netherlands, Norway, Indonesia and Liberia. The Tropical Forest Alliance is committed to reduce, and eventually eliminate, the deforestation associated with the sourcing of palm oil, soy, beef, pulp and paper.
Driving change in the tea industry
In 2006 we helped Rainforest Alliance develop a certification process for sustainable tea. This had a galvanising effect not only on our own supply chain but on other tea manufacturers and today Rainforest Alliance certified tea accounts for around 14% of global black tea sales. 53% of our own volumes now come from sustainable sources.
We have worked with the Kenya Tea Development Agency (KTDA) and large suppliers, McLeod Russel and Camellia, to convert 26% of the world’s production to Rainforest Alliance certified tea. We have signed public-private partnerships in Tanzania, Vietnam and Yunnan province in China, which will develop sustainable practices and aim to improve the livelihoods of the people working in these supply chains.
In India, we developed the Trustea sustainable tea certification standard in partnership with the Tea Board of India and a range of other stakeholders, including the Sustainable Trade Initiative IDH, Tata Global Beverages, the Rainforest Alliance, Solidaridad and the Ethical Tea Partnership.
Driving change in agricultural systems with the Unilever Sustainable Agriculture Code
Our open-source Unilever Sustainable Agriculture Code has been used not only by other companies but by whole sections of the farming industry:
Australian dairy industry. Australia has become the first country to ensure its entire dairy sector is compliant with Unilever’s Sustainable Agriculture Code. All dairy production accredited by Dairy Australia – which represents the country’s whole dairy sector – now meets the requirements of the Code.
Madagascan vanilla industry. We buy a significant proportion of Madagascar’s vanilla crop for our ice creams, such as Magnum, Carte d’Or and Ben & Jerry’s. In January 2014 we announced a partnership between Unilever, our supplier Symrise and the German sustainable development agency GIZ, to improve the livelihoods of 4,000 vanilla farmers.
- North American soy industry. We have mainstreamed Field to Market’s Fieldprint Calculator, working in partnership with Field to Market, 41 of ADM’s farmers, the Iowa Soybean Association and WWF. In 2013 we went from zero to 44,000 acres – nearly a third of all the acres in the Field to Market initiative are down to this single partnership. More importantly we now have a network of farmers through ADM who we can prove are continuously improving.
Driving change though continuous improvement policies with suppliers
We work with suppliers to continuously improve sustainable practices. In 2013 and early 2014 we launched the following two important new supplier policies:
Sustainable Palm Oil Policy (launched November 2013). Building on the Roundtable on Sustainable Palm Oil’s Principles & Criteria as a foundation, our Sustainable Palm Oil Sourcing Policy is designed to drive market transformation by working with key suppliers and the industry to focus on a halt to deforestation, protect peat lands and drive positive economic and social impact for people and communities.
- Responsible Sourcing Policy (launched April 2014). We have developed a new Responsible Sourcing Policy and introduced our continuous improvement ladder for suppliers. This replaces our previous Supplier Code, launched in 2011, and demonstrates a new, more rigorous, but more rewarding approach to responsible and sustainable sourcing.
Sustainable sourcing of all our agricultural raw materials remains an ambitious target, especially where our market influence is low because we buy small volumes of materials. We started with our top ten agricultural materials – which account for around 70% of our total volumes – and have been moving beyond this to consider the next 30. These account for around 20% of our total volumes.
In 2013 we made progress on a wider range of ingredients from sourcing sustainable starch in Europe, partnering with Cargill and working with English mustard farmers for our Colman’s brand to working with meat suppliers and Compassion in World Farming.
We recognise that verification and certification are not end goals in themselves. The real challenge is to show the positive impacts that sustainability can have on the lives of farmers, the environment and the communities in which they live and work.
We will continue to work on the traceability and transparency of our raw materials’ supply, together with our suppliers.
We are determined to make meaningful progress in transforming complex global supply chains at scale. We can only do this when all relevant stakeholders – including primary producers, processors, traders, retailers, civil society and governments – work together.
What do we mean by sustainable agricultural sourcing?
Sustainable agriculture means growing food in ways which sustain the soil, minimise water and fertiliser use, protect biodiversity and enhance farmers’ livelihoods.
Each of our agricultural raw materials, whether tea, tomatoes or soy, has a different growing method. When we began working on this issue, there were no agreed definitions of what sustainable farming meant for these and other crops. We established our Sustainable Agriculture Programme over 15 years ago. Since then, we have developed detailed guidelines on what sustainable agriculture means for our key crops which we publish open-source in the Unilever Sustainable Agriculture Code.
We define sustainable sourcing using 11 social, economic and environmental indicators:
Soil health: improving the quality of soil and its ability to support plant and animal life.
Soil loss: reducing soil erosion which can lead to loss of nutrients.
Nutrients: reducing the loss of nutrients through harvesting, leaching, erosion and emissions to air.
Pest management: reducing the use of pesticides.
Biodiversity: helping to improve biodiversity.
Farm economics: improving the product quality and yield.
Energy: reducing the greenhouse gas emissions associated with farming.
Water: reducing the loss and contamination of water supplies from agriculture.
Social and human capital: ensuring the capacity of people to earn and sustain their livelihoods as well as enhancing farmers’ knowledge, training and confidence.
Local economy: helping sustain local communities.
Animal welfare: ensuring animal standards are based on the ‘five freedoms’ defined by the Farm Animal Welfare Council.
We also have a clear definition of sustainable sourcing for paper and board materials. See Sustainable paper & board.
How do we measure sustainable sourcing?
We have developed a metric for the sustainable sourcing of raw materials. This is defined as either raw or packaging material sourced from verifiable sustainable renewable sources or made from recycled materials (% by weight).
Laying the foundations of the Unilever Sustainable Agriculture Code
Unilever has been carrying out research into sustainable agriculture since the mid-1990s. Our Lead Agriculture Programmes have investigated a range of techniques to reduce the environmental impact of farming, whilst maintaining yield and profits for farmers.
We started with a focus on five key crops – palm oil, peas, spinach, tea and tomatoes. Whilst some of these programmes continue today, we have now extended our work into other crops and ingredients, for example fruit and vegetables, gherkins, dairy, eggs and vegetable oils. Throughout, we have worked closely with local growers and planters, research institutes, industry and farmers’ associations, local government, NGOs and sometimes community groups.
We began publishing these techniques for all our key crops in Good Agricultural Practice Guidelines. In 2004, we started engaging our growers in the use of these Guidelines, in cooperation with other partners. This led to several changes and improvements leading up to the open-source publication of the Unilever Sustainable Agriculture Code in April 2010.
Unilever Sustainable Agriculture Code
Our sustainable sourcing programme relies on compliance with the Unilever Sustainable Agriculture Code (SAC), either through self-assessment and verification against the code or through external certification standards that we recognise as equivalent to the code, such as those of Rainforest Alliance (RA) or the Roundtable on Sustainable Palm Oil (RSPO). Rainforest Alliance works to arrest the major drivers of deforestation and environmental destruction. The Rainforest Alliance Certified™ seal provides reassurance to consumers that our products are sourced from farms applying rigorous sustainability standards. RA supports our supplier development programme across all major tea producing countries. The Roundtable on Sustainable Palm Oil is a multi-stakeholder organisation made up of buyers, processors and plantation owners that provides the standard for sustainable palm oil cultivation. Through mandatory and good practice standards, our SAC defines a process of continuous improvement.
We have developed a new Responsible Sourcing Policy in 2014 and introduced our continuous improvement ladder for suppliers. This replaces our previous Supplier Code, launched in 2011, and demonstrates a new, more rigorous, but more rewarding approach to responsible and sustainable sourcing.
Our Unilever Sustainable Agriculture Code applies to all our suppliers of agricultural raw materials, the farmers producing them and contractors working on farms. Suppliers must comply with the Code Scheme Rules, which detail external-certification standards and self-verification methods. We published these Rules in 2012. Implementation Guides help farmers put our Code into practice. We work with software developer Muddy Boots to implement the SAC according to the Scheme Rules and with Control Union to provide training to suppliers.
We now have sustainably sourced tomatoes, dairy, rapeseed, sunflower seed, sugar beet and potatoes, demonstrating the Code’s flexibility across crops and countries. See Downloads for more information.
Our aim is to ensure continued access to our key agricultural raw materials and communicate the value of sustainable sourcing to consumers and influence their buying habits. We expect all our suppliers of agricultural raw materials to commit to improving their sustainability and to demonstrate that they adopt minimum standards and improve performance over time.
Meeting the criteria for sustainable sourcing
We use a variety of methods to ensure that our supplies of raw materials meet our sustainable sourcing requirements. We are working with certification organisations such as Rainforest Alliance (for tea and cocoa), the Roundtable on Sustainable Palm Oil (for certified, sustainable palm oil), the Round Table on Responsible Soy (for certified, sustainable soy), Fairtrade (for Ben & Jerry’s ice cream flavours) and Bonsucro (for the sustainable sourcing of sugar) and others.
However, external certification is not an option available to us in all cases. Sometimes these standards do not apply to all types of raw materials or geographies. Working with hundreds of different national and crop-specific schemes is complex and resource intensive. Where certification standards do not exist, our approach is to supplement our certified partnerships with a system based on self-verification following the standards in the Unilever Sustainable Agriculture Code.
For some of our crop suppliers we are using Quickfire, a software tool that enables our suppliers to carry out a self-assessment against each of the 11 indicators which make up the Unilever Sustainable Agriculture Code (SAC).
The tool allows assessment of whether a supplier’s materials comply with the sustainable agriculture requirements of the SAC and identifies areas of best practice and areas for improvement, providing a basis for us to build a collaborative action plan for continuous improvement. It also collects data that allows us to measure the impacts of sustainable sourcing.
We began using this system in 2009 with our suppliers of fruit and vegetables. By the end of 2012, more than half of our suppliers had self-verified their practices according to the Unilever Sustainable Agriculture Code. This process is being reviewed by an independent verifier to ensure that it is an adequate basis for including raw material volumes as sustainably sourced.
Tools to improve sustainable farming
In 2010 we launched our Cool Farm Tool with experts from the University of Aberdeen in Scotland. This is a calculator to help farmers reduce their carbon emissions on their farms.
In addition to raising awareness of the effect their actions have on the climate, the tool prompts farmers to make improvements, which often cut bills as well as benefiting the planet. It is designed to be simple and practical to use, allowing farmers to identify the changes that will have an impact on reducing emissions. It also allows farmers to prioritise options by running different scenarios to see how much of an impact they make. Cool Farm Tool takes account of a wide variety of factors including soil, climate, livestock, land use and input intensities, then presents the user with measures that can be implemented at the field and farm level.
In 2013, The Cool Farm Institute (CFI), which includes Unilever, launched a new online tool that is based on our Cool Farm Tool. Businesses of all sizes, including individual farmers, are being invited to join the initiative. The tool can be accessed via the Institute’s website(Link opens in a new window). Use of the online tool is free, but it does not allow data storage or data output. Members of the CFI enjoy the full functionality of the tool. CFI is considering additional functionalities (eg water footprinting and biodiversity footprinting).
We also use our web-based tool, EIGER, which provides maps giving detailed information about agricultural raw materials, biodiversity, water, GDP and population. EIGER helps us to identify new supply chains and new supply routes to ensure a secure supply of raw materials over the long term. It identifies opportunities and risks posed by global environmental and social trends that we need to consider when making sourcing decisions. These include:
New sourcing countries: where do crops grow best, now and in the future?
Water vulnerability: which areas suffer water scarcity or will do so in the future? What is the irrigation water demand for our crops?
Biodiversity impacts: are existing or new sites and supply chains close to or inside biodiversity conservation areas?
The database was compiled using data from a range of R&D organisations and institutes.
Livestock Implementation Guide
Our Livestock Implementation Guide can be downloaded from this page. It was completed in 2013 with the help of our external partners FAI Farms (Farm Animals Initiative). It replaces our previous Dairy Implementation Guides and extends the advice to cover meat as well as dairy.
Species covered are cattle (for dairy and beef), pigs (for pork) and chickens (broilers for meat and layers for eggs). The advice covers the full range of Sustainable Agriculture Code chapters, giving specific advice for livestock farming on issues such as manure management and reduction of greenhouse gas emissions. It gives more detailed, species-specific information for the Animal Welfare chapter.
As well as the Sustainable Agriculture Code coverage, there is an additional guide for the transport and slaughter of animals. This is outside the current scope of the Unilever Sustainable Agriculture Code, but will be included in the next version, as both are important in terms of animal welfare. We are pre-empting these revisions with guidance for suppliers ahead of time.
Oxfam report: Behind the Brands
In February 2013, Oxfam released their ‘Behind the Brands’ report, as part of the GROW campaign on food security. In the report, which is based on publicly-available information, Oxfam assesses the social and environmental impact of the ten largest, branded, food and beverage products companies worldwide.
Unilever tops the scorecard on the issues of farmers (including small-scale farmers) and workers (including farm workers). The report recognises the progress Unilever has made in its policies and practices under our Sustainable Living Plan and sustainable sourcing programme, including the areas of water use and climate change.
The report places emphasis on greater transparency and on the importance of the role of women and land rights in the supply chain. We welcome this as we have highlighted these two issues ourselves.
Sustainable Agriculture Initiative Platform
What can be achieved at farm level by Unilever alone is limited. We need the co-operation of others in the food industry to make progress in sustainable agriculture. That is why we worked with Nestlé and Danone to establish the Sustainable Agriculture Initiative Platform (SAI Platform) in 2002. The initiative today involves more than 50 companies from the food and beverage industry. It aims to develop knowledge about sustainable agriculture and communicate widely with a range of stakeholders.
The SAI Platform has working groups on four commodity areas: dairy, arable and vegetable crops, coffee and fruit. Another working group addresses water-related issues. It has also established a Farmer Self Assessment (FSA) tool with the objective of offering its members a standard assessment tool, benefiting suppliers and their farmers through a consistent approach.
Unilever is an active member of most of the working groups. Progress includes the development of an online database of best practice in water management. The SAI Platform also played a key role in establishing a Global Dairy Agenda for Action on Climate Change.
Our mined-minerals programme
Responsible mineral extraction is an area we are currently looking at. As Unilever is not a major driver in this space, it is important that we work with suppliers and others in the industry to get advice on how we can make progress.
This also needs a very different approach to sustainable agriculture. So we have started a programme to assess responsible mineral extraction, which was piloted in 2013. This involves assessing transparency in our supply chain back to the extraction sites; raising standards where necessary to a minimum; and then encouraging continuous improvement to best-in class.
In 2013 we worked with key suppliers in China and India to understand issues. In 2014 we are looking at learnings from these and developing actions that we will report on in due course.
Sustainable Sourcing Advisory Board
Our Sustainable Sourcing Advisory Board (SSAB) was established in 2011 and replaces our previous Sustainable Agriculture Advisory Board that was established in 2000. The group reflects the broader expertise needed to help deliver our Sustainable Living Plan targets. See Our Governance for more information.
Our SSAB includes external experts, academics and representatives from NGOs. Its role is to advise Unilever on the key aspects of sustainable sourcing of raw materials and the various areas that make up sustainability in Unilever’s value chains. This includes everything from climate impact, biodiversity and water stress, to labour conditions, poverty alleviation and the use of chemicals. An important aspect of its role will be to identify and explore potential connections with similar initiatives in other companies, sectors and research institutes, and with governments, multi-lateral organisations and civil society organisations.
Sustainable Sourcing Advisory Board members
|Janet Barber||Forum for the Future||UK|
|David Bright||Oxfam GB||UK|
|Colin Chartres||Independent||Sri Lanka|
|Christophe Liebon||Intertek||Hong Kong|
|Ken Giller||University of Wageningen||Netherlands|
|Camilla Toulmin||International Institute for Environment and Development||US|
|Anne Wallin||Dow Chemical Europe||US|
|Tensie Whelan||Rainforest Alliance||US|
|Tom Burke||Rio Tinto||UK|