P&G Perspectives on Palm Oil

Palm Oils are produced from the fruit of the palm tree: one of the most land use efficient crops, it is versatile, productive, and easy to cultivate

• Approximately 6 million people rely on palm for their livelihoods
• 40% of palm globally is grown by smallholder farmers – it's easy cultivation and year-round productivity make it appealing for smallholder (RSPO definition <50 hectares land ownership)
• 30-35% of the world's vegetable oil is palm yet it is grown on only 10% of the land used to produce vegetable oils
• Palm Oil is 4x more productive* than the next best vegetable oil (Soy, Rapeseed) and up to 10x more productive than Coconut, Sunflower

_{*defined as volume output per hectare of land cultivated}

Oil palm is cultivated in the “Tropics or Equatorial Zone” an ecologically important, biodiverse and sensitive area. The rapid development of palm plantations in the last 20 years has in some cases involved:

• Clearance of High Conservation Value (HCV) areas and High Carbon Stock (HCS) Forests; Depletion of Peat; and use of clearance methods including burning
• Habitat loss has put endangered species like Orangutans, Tigers, Sumatran Rhinos and Elephants at risk
• Disregard for the human, labor and land rights of local communities, indigenous peoples, and human and labor right concerns

P&G acknowledges the complexities and concerns related to the use of palm-based ingredients. Many stakeholders recognize that there is no obvious single straightforward solution or option. Alternate sourcing options for palm oil ingredients often present different dilemmas e.g. use of petroleum-based synthetics, animal derived materials or less land efficient vegetable oils. The challenge is that these choices may result in unintended consequences – rather than resolving concerns and they could potentially create new or worse issues.

P&G believes it is possible to work for and towards sustainable and responsible palm use – one that protects the planet and respects the rights and livelihoods of the people and communities who rely on palm for their livelihoods. We recognize that this will take our commitment and identifying solutions is an on-going journey. P&G is committed to responsible sourcing within our supply chains, to work together with other stakeholders to find industry wide solutions and to continue to support programs that can have a positive impact on palm landscapes.