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What we do
How we work with Johnson & Johnson on palm oil
Johnson & Johnson Consumer, Inc. and TFT began working together in March 2014 with the aim of ensuring that Johnson & Johnson suppliers of oleo chemicals meet Johnson & Johnson’s Responsible Sourcing Criteria for palm oil. TFT and Johnson & Johnson initially worked intensively to strengthen the existing palm oil commitment. On May 1st, 2014, Johnson & Johnson announced its Palm Oil Responsible Sourcing Criteria, a ground breaking commitment especially for a buyer of oleo chemicals.
Since then TFT has been supporting Johnson & Johnson by helping trace the origin of palm oil used, identify high-risk areas and engage priority suppliers to implement the criteria. Johnson & Johnson is also investing in a range of on-the-ground projects that contribute to positive impact on management practices in its palm oil supply chain through its Responsible Palm Oil Fund. An overall action plan is in place and progress is reported through TFT’s Transparency Hub (see below for the latest updates).
Johnson & Johnson palm oil usage
Palm Oil and Palm Kernel Oil Usage in Chemical Derivatives Supply Chains
About 0.1% of global palm oil eventually ends up being derived into ingredients used by Johnson & Johnson in its finished products. A majority of the Company’s usage, around 45,000mt enters its upstream supply chains as a feedstock for complex chemical ingredients that are derived partly from palm oil. The Company is transitioning to Roundtable for Sustainable Palm Oil (RSPO) physically certified supply chain models where possible, and in the interim is using a mix of segregated and mass balance oils, while buying certificates for the remaining palm oil used in its upstream supply chains.
Johnson & Johnson’s second largest usage, 36,500mt, is through ingredients derived from palm kernel oil. Palm kernel oil is the waste product from palm oil production crushed out of the inedible fruit nut that would otherwise be discarded.
Lastly, Johnson & Johnson purchases 8mt of refined palm oil from a distributor. All eight tons are RSPO Certified Mass Balance, which supports the sustainable production and introduction of palm oil into the market.
2017 progress update
While Johnson & Johnson’s usage is relatively small, its ambition and commitment to help advance responsible palm oil production is big. The following is a summary of Johnson & Johnson’s activities and progress in 2017:
- Alignment with Sourcing Criteria: Johnson & Johnson is committed to ensuring that 100% of its top suppliers, accounting for over 85% of its upstream palm oil and palm kernel oil usage, have sourcing commitments as strong as its own. In 2017 the Company engaged its top suppliers to evaluate alignment of their sourcing policies to its Responsible Palm Oil Sourcing Criteria. As a result, Johnson & Johnson confirmed that 50% of its top suppliers have palm oil sourcing policies or commitments aligned with its Responsible Palm Oil Sourcing Criteria.
- Transparency: Johnson & Johnson is dedicated to achieving 100% transparency across all mills feeding into its supply chains. To this end, the Company engaged its top suppliers to drive transparency in their respective supply chains, achieving an exceptional 68% traceability back to mill for its palm oil derivatives supply chains.
- RSPO Certification: Johnson & Johnson has been a member of the RSPO since 2006 and believes that a strong and recognized industry sustainability standard, like RSPO, is the best way to ensure long-term responsible production. The Company is committed to purchasing certificates, using RSPO-certified material from mass balance and segregated sources, and increasing its supply of certified material every year. Johnson & Johnson reports its progress on an annual basis through the RSPO Annual Communication of Progress (ACOP). Currently, 64% of the palm oil and palm oil derivatives used in J&J products are RSPO certified, with the following breakdown per certification category:
- Segregated: 12%
- Mass Balance: 1%
- Book & Claim: 51%
In addition to its traceability and certification efforts, Johnson & Johnson makes investments through its dedicated Responsible Palm Oil Fund, to support on-the-ground projects that contribute to positive impact in palm oil management practices in its supply chains.
There were three projects underway in 2017:
- In partnership with The Forest Trust Rurality Project, Johnson & Johnson created an action plan specifically developed for farmers in the Sei Nilo region of the Pelalawan sub-district in Indonesia to improve palm oil fruit quality, shorten supply chains and identify other potential commodities as alternative income generators.
- Through efforts with The Sustainable Trade Initiative, Johnson & Johnson helped increase productivity of palm oil plantations through smallholder capacity development and established farmer institutions that supervise and facilitate farmers in obtaining RSPO certification in Rokan Hulu, Indonesia.
- Johnson & Johnson supported an initiative with the University of Wageningen that was successful in increasing yields in smallholder palm oil fields and training farmers on implementing better management practices starting from the constraints faced on existing farms. Johnson & Johnson extended this project into 2019 to monitor progress on the effect of the program on yields and the impact of the training.
2018 Q1-Q3 progress update
Following is the summary of Johnson & Johnson’s progress in meeting its palm oil commitments so far in 2018:
- In an effort to increase transparency in its supply chains, Johnson & Johnson published a list of its top direct suppliers who gave permission for such disclosure. These suppliers represent about 83% of the Company’s palm oil derivatives volumes. In addition, Johnson & Johnson published a list of potential mills that its direct suppliers provided to The Forest Trust (TFT) and that they gave permission to disclose.
- In an attempt to optimize it’s efforts around verification and actions surrounding non-conforming producers, Johnson & Johnson also significantly refined its nonconformance process to differentiate the types of action pathways it may take as a palm oil derivatives buyer. Based on this revised approach, Johnson & Johnson has taken the following actions:
- 3 producers have been removed following Johnson & Johnson’s requests
- 2 subsidiaries of producers in Johnson & Johnson’s extended supply chain are facing commercial restrictions
- 8 producers are at various stages of TFT’s High Impact Supplier Program (HISP)
- 5 producers are awaiting viability assessments for inclusion in the HISP
Lastly, Johnson & Johnson initiated two additional partnerships to create impact on the ground – one with Ecohealth Alliance in Liberia and another in the final stages of development with a global NGO in Malaysia.
Q3 2018-Q2 2019 Workplan
Johnson & Johnson will continue its efforts to meet its palm oil commitments over the coming months. For information on the Q3 2018-Q2 2019 workplan click here