As Fires Consume Indonesia, Pepsi Profits

by Ivy Schlegel

September 23, 2015

PepsiCo's updated sustainable palm oil commitment is another half step, but protecting forests requires a big leap.

Fighting Forest Fires in Sumatra

© Ulet Ifansasti / Greenpeace

As I write this, Indonesia and the surrounding region are covered in a dark cloud of haze and smoke, the result of forest fires associated with industrial pulp and palm plantations. Although there are laws against the burning, the fires continue, choking the region and forcing people to make the choice between wearing a mask when they go outside or not go outside at all.

Some of the fires are accidental ones that grow out of control in the landscape — dried by the draining of peatlands to plant oil palm. Some, however, are intentional, set by plantation companies looking to clear large swaths of land quickly. The public health impacts of the haze underscores the urgent and severe crisis that palm oil presents.


In 2013, Greenpeace launched the Tiger Challenge, pressuring consumer goods companies that use palm oil to remove deforestation from their supply chains. Thanks to pressure from supporters around the world, consumer companies like Procter & Gamble and Mars adopted sustainable palm oil commitments, moving the needle towards palm oil that is forest-friendly.

Lagging Behind

Back in May 2014, PepsiCo announced a new Forest Stewardship Policy and Palm Oil Commitment. PepsiCo uses palm oil in snack foods like Doritos chips and Quaker Oats granola bars. While it was refreshing to see such a large and influential company start to catch up to its peers in the Tiger Challenge, we were disappointed with its weak ambition. Though PepsiCo included measures that went beyond Roundtable on Sustainable Palm Oil standards, it failed to guarantee that its entire supply chain would be free from deforestation and social conflict, stopping short of applying this policy to its suppliers operations. We continued to push them to do better.

Sumatran Tiger in Indonesia

This week, PepsiCo has updated its palm oil commitment, taking a half step towards protecting more forests. The company has stepped up their efforts to identify their sources of palm all the way back to the plantation, and now includes specific language addressing workers’ rights, vital considering that forced and child labor is widespread on palm oil plantations. Still, this commitment falls massively short of what is needed to protect forests, with a lackluster timeline of 2020 for change on the ground, and failing to use the prevailing standard for defining high carbon stock forests (hint: it’s the HCS Approach).

A Critical Loophole

The company also left in a loophole: its current policy does not apply to joint venture partners,including the company that manufactures PepsiCo’s snack food products like Lays and Cheetos in Indonesia. A new report this week by Rainforest Action Network and Rainforest Foundation Norway contains case studies of palm oil production practices of PepsiCo’s partner, demonstrating that PepsiCo’s loophole is big enough to drive a bulldozer through.

Loopholes like this point to the massive shortcomings of individual sustainable palm oil commitments, both strong and weak, and the need for traders of palm oil to work together to close the market to palm oil made from forest destruction.


How You Can Help

The progress we’ve already made in protecting Indonesian forests from exploitation have been possible because of your actions. Now, it’s time to put the same pressure on PepsiCo to clean up its palm oil supply chain and save the last remaining rainforests in Indonesia.

Here are two things you can do:

  1. Click here to visit our friends at Rainforest Action Network and send a message to PepsiCo. RAN has been on PepsiCo’s tail, and with your support, they will continue to push them to close this disastrous loophole
  2. Click here to demand forest friendly palm oil from all companies who continue to expose their customers to forest destruction.

The problem with palm oil is not going away unless companies hear from their customers (that’s you). And with fires consuming vast areas of rainforest every day, there’s no time to waste..

Stand with us to fight for forests today.

Ivy Schlegel

By Ivy Schlegel

Ivy Schlegel is a senior research specialist with Greenpeace USA plastics team, focusing on strategic corporate research, the petrochemical and plastic value chains, and health and climate impacts of plastic production. Prior to joining the plastics team, Ivy worked on Greenpeace USA's forest work focusing on Indonesian palm oil and other forest-based commodities. Ivy has worked with Greenpeace USA since 2009.

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