Foodservice the laggard in ‘decade of failure’ on palm oil

Foodservice Footprint shutterstock_165902177-300x198 Foodservice the laggard in ‘decade of failure’ on palm oil Foodservice News Analysis    WWF’s latest scorecard on sustainable palm oil isn’t all bad news, but food chains, caterers and pubs should be ashamed of their record, says David Burrows.

Ten years ago WWF started assessing the palm oil sourcing strategies of leading food manufacturers and retailers. However, it wasn’t until 2013 that the spotlight turned on foodservice, with Compass, McDonald’s and Sodexo the first three to be scored. By 2016 there were 11 companies from the sector, covering 166,960 tonnes of palm oil. The findings were mixed.

Having been scored on just three actions – joining the Roundtable on Sustainable Palm Oil (RSPO), reporting progress, and setting “tough targets” to buy RSPO-certified sustainable palm oil (CSPO) – the likes of McDonald’s, Tim Hortons (owned by Restaurant Brands International) and Sodexo managed maximum points (nine out of nine), but Whitbread and Yum! didn’t manage a single point.

Meanwhile, Compass (four points) wasn’t buying any CSPO. A spokesperson suggested WWF’s assessment of the group globally was partly to blame for the score, but this didn’t wash with WWF’s agricultural commodities manager Emma Keller: Sodexo had managed it so others could too, she told Footprint at the time.

“While we see some very good performers in this sector, like McDonald’s and Sodexo, too many others are not yet moving far or fast enough,” Keller explained. “A number of foodservice companies didn’t respond to our requests for information, and in a world where transparency and openness is so important this is not acceptable behaviour.”

Which brings us to the latest scorecard, published this month. It is a far more comprehensive assessment of how companies are doing, with scores based not just on commitments to buy CSPO, but also on how much sustainable palm oil is actually being used, whether there is full traceability down the supply chain, and if there are requirements on suppliers to commit to no deforestation or no conversion. WWF even looked beyond the supply chain, awarding additional points for supporting smallholders and conservation projects, for instance.

The findings were not particularly pretty. Of the 22 points on offer, only McDonald’s (13.8) and Yum Brands (12.3) managed to score more than 50%, with Sodexo (10) and Greggs (9.5) the only other companies not deemed “laggards”. Compass (nine), Whitbread (six) and Wendy’s International (2.8) all have a lot of work to do.

Greggs claimed the score isn’t reflective of where it is today on palm oil; however, the only upodate a spokeswoman offered was the fact it has since joined the RSPO, a move that merits a single point. McDonald’s said it takes its promise to eliminate deforestation from its global supply chains by 2030 “seriously”, but so far only 67% of its palm oil supply is verified as deforestation-free. Whitbread said it is confident of meeting its 2020 target to source 100% CSPO by the end of the year (it’s on 80%, all of which is “mass balance”, which is when CSPO is mixed with ordinary palm oil in the supply chain).

With an average score of nine out of 22 for respondent companies, and 7.3 if non-respondents are included, foodservice scored the lowest of the sectors, and is the only sector to pick up less than half of the points available. Retailers, by comparison, scored 12.9, while manufacturers mustered 11.9.

Arguably, none of the three sectors has much to celebrate. After a decade of promises, too many companies have failed to deliver,” said Keller. But it’s when looking at individual company scores that the gulf between foodservice and leaders in other sectors is truly exposed. McDonald’s, remember, scored 13.8 out of 22, with 100% of its palm oil being CSPO. Yum Brands (12.3) and Sodexo (10) were next in the table. Now compare that with the other two sectors. Some 32 of the 108 manufacturers scored the same or more than McDonald’s – a brand that has been “carrying the weight of the [foodservice] sector” given its CSPO volumes, according to the 2016 scorecard – while 17 of the 54 retailers scored at least 13.8, with Ikea and Marks & Spencer hitting 19 and 18.8 respectively. Of the 31,826 tonnes of palm oil used by Ikea, 100% is segregated or identity-preserved CSPO. This is essential, says WWF, given that brands can show that the palm oil they are using for their products is actually from sustainable sources.

Foodservice companies, however, remain heavily reliant on mass balance or the “book and claim” approach, through which companies pay producers of CSPO for certificates to cover the volume of palm oil they use, although the actual palm oil that goes into their products may come from uncertified sources. Book and claim is ideal for kick-starting the process to more sustainable sourcing but it still allows the global supply chain to continue trading uncertified and potentially unsustainable palm oil, said WWF in its accompanying notes.

The fact that only 16.3% of all the palm oil across the three sectors was segregated and identity-preserved CSPO is cause for concern, therefore. None of Yum’s near 158,000 tonnes met this standard. Still, Yum’s progress is noteworthy given that it scored zero in 2016. Whitbread (six out of 22) is still struggling, but having not responded in 2016 and scored zero, it now has some points on the board. It used 92.6 tonnes of palm oil in 2018, of which 80% was mass balance, with the rest “uncertified or not disclosed”. The pub chain is one of four foodservice companies to have publicly committed to sourcing 100% CSPO by the end of this year. Yum looks to be at 94%, while McDonald’s and Gregg’s have already met the target. Compass, which didn’t respond to requests for a reaction, has a deadline of 2022, but it’s already at 100%. Sodexo has also already made it despite going for 2025, although 41% is book and claim. “Our commitment is to source 100% physical CSPO globally by 2025 for our two highest palm oil content products: frying oil and margarine,” a spokeswoman said.

Only four foodservice companies require their suppliers to have a zero deforestation policy, which is concerning given the criticism levelled at the RSPO and CSPO in relation to deforestation. The foodservice sector performed similarly poorly in the area of traceability – only four firms require traceability to mills and only two require traceability to plantations.

Overall, foodservice companies assessed in the scorecard claimed to use 294,368 tonnes of palm oil in 2018, representing just 3% of the total palm oil usage across all three sectors. The low volumes being used compared to manufacturing and retail was actually put forward as an excuse for inaction by one company Footprint spoke to). However, there are “questions regarding how accurately this sector – and to a certain extent all the sectors – have been at quantifying their actual dependence on palm oil via their declared volumes”, said WWF. And while a “disappointing” 55% of foodservice firms have achieved 100% CSPO, this is in line with retail and manufacturing. It also represents a “significant step” since 2016 when the figure was 25%.

Looking at the overall results across the past three scorecards, there has been a similar “encouraging albeit slow” uptake in sustainable palm: from 29% in 2013 to 39% in 2016 and 58% in 2019. But this isn’t anywhere near fast enough to counteract the damage caused by irresponsible production. Action must be “bigger, bolder and faster”, WWF concluded in its 2019 scorecard summary. Worryingly, this was much the same message in its first assessment, back in 2009: "The sector as a whole still has a long journey ahead before sustainable palm oil sourcing becomes the norm. And yet, many companies appear to be moving in the right direction in terms of their intention to use CSPO." Ten years have made a difference, but not enough of one.

WWF Scorecards over the years:





2019: (summary:




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