Investors Applaud Bunge’s* Commitment to Decouple Palm Oil From Deforestation
Contact: Lucia von Reusner, Green Century Capital Management, 617-482-0800, email@example.com
October 27, 2014: Today, global agribusiness giant Bunge Ltd (Bunge) joined the growing number of companies that have pledged to eliminate palm oil linked to deforestation from their global supply chains. Responding to concerns from investors and customers, Bunge announced today that 100% of the palm oil it trades, processes, and sells would be fully traceable back to suppliers verified as protecting High Carbon Stock Forests, peatlands, and worker and community rights. Concerns remain however that Bunge has not included a timeline for implementing this ambitious pledge.
“Companies and their investors increasingly recognize that destroying rainforests and driving climate change is unacceptable business practice,” commented Lucia von Reusner, Shareholder Advocate for Green Century Capital Management, which manages the first family of diversified responsible fossil fuel free mutual funds and coordinated the investor letter urging Bunge to adopt this commitment. “With the market rapidly shifting away from unsustainable deforestation, it is absolutely critical that Bunge adopt a clear timeline for when suppliers, customers, and investors can expect the company to provide deforestation-free palm oil. We also urge Bunge to extend this commitment across all of its commodities, since the risks associated with deforestation are not unique to palm oil alone.”
Bunge is a global agribusiness company involved in the trading and processing of major agricultural commodities, including palm oil. Palm oil is the most widely used vegetable oil in the world. In the past decade, clearing land to grow palm oil has become a leading driver of deforestation and carbon emissions in Southeast Asia. In the past year, companies representing over 60% of global palm oil trade have pledged to ensure that all palm oil they purchase will not contribute to the destruction of forests or peatlands, or human rights abuses. Last month, Bunge’s competitor Cargill,* the largest importer of palm oil into the United States and largest private company in the nation, pledged to eliminate deforestation across all commodities it trades and sells.
“Climate change is risky business—for people, the planet, and investors,” noted Leslie Samuelrich, President of Green Century Capital Management. “Investors expect companies to build sustainable supply chains that protect the environment upon which their businesses and all of us depend,” stated Samuelrich.
When allegations emerged that Bunge was a top customer of a highly controversial palm oil supplier that has been actively working to sabotage sustainability efforts, Green Century Capital Management sent a letter urging Bunge to adopt and enforce stronger environmental and social standards for sourcing the commodity. The letter, signed and supported by institutional investors representing over $360bn in assets under management and available here, expressed concerns that Bunge was exposed to significant business risks associated with sourcing from high-risk suppliers. Green Century has since had several phone call discussions with the company about adopting a zero-deforestation palm oil sourcing commitment.
Over the past few months, Green Century has secured commitments from top palm oil consuming companies including Kellogg’s,* Smuckers,* and ConAgra* to only purchase palm oil from suppliers that adhere to ‘no deforestation’, as defined by no clearance of High Carbon Stock and High Conservation Value forests. Other companies that have recently adopted zero-deforestation palm oil commitments include several of the world’s top palm oil consumers such as Procter & Gamble,* Mondelez,* and Colgate-Palmolive. Responding to the demand from these companies, several of the world’s largest palm oil traders including Wilmar,* Golden Agri-Resources (GAR),* Bunge, and Cargill, which together trade over 60% of the world’s palm oil, have committed to ensuring zero deforestation across all of their supply chains
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Green Century Capital Management is an investment advisory firm that manages the first family of responsible and diversified fossil fuel free mutual funds. Founded in 1991 by a network of non-profit organizations, the state Public Interest Research Groups (PIRGs), Green Century leads an effective shareholder advocacy program to convince companies to establish and implement environmental policies that protect our land, water and air.
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*As of September 30, 2014, Bunge, Ltd; Kellogg Company; The JM Smucker Company; Procter & Gamble Company (The); Mondelēz International, Inc.; and Colgate-Palmolive Co. comprised 0.00% and 0.18%, 0.00% and 0.25%, 1.12% and 0.15%, 0.00% and 3.35%, 0.00% and 0.86%; and 0.00% and 0.89% of the Green Century Balanced Fund and the Green Century Equity Fund, respectively. Other securities mentioned were not held in the portfolios as of September 30, 2014. References to specific securities, which will change due to ongoing management of the Funds, should not be construed as a recommendation by the Funds, their administrator, or their distributor.
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