Palm Derivatives Users Pool Funding to Create Positive Impact in Sourcing Regions

This impact story was originally published on the Action for Sustainable Derivatives (ASD) website here.

Leading cosmetics, personal care, healthcare and oleochemicals companies are providing funding to a project that will generate positive environmental and social impact in the region where they source palm oil derivatives.

At least six members of Action for Sustainable Derivatives (ASD) – including Croda International, The Estée Lauder Companies through its Charitable Foundation, GSK Consumer Healthcare, Natura &Co, Seppic and Stéarinerie Dubois – will collectively provide financial support to an on-the-ground project in a priority region that has strong supply chain links and systemic environmental and human rights challenges.

The ASD Impact Fund has been developed in partnership with Tides Foundation, using the Tides collective action fund model which provides an established, efficient and effective way to enable multi-donor collaboration to help create positive change in the world.

ASD is a collaborative initiative of palm oil derivatives users aiming to transform their supply chains. Each year, ASD conducts an investigation to map its members’ supply chains and monitor risks. This helps to identify priority supply chain players to engage, as well as the priority landscapes in which to focus investment.

To drive positive impact on the ground in those priority landscapes, the collaboration undertook an extensive process to identify existing projects that address underlying issues influencing responsible practices in palm production landscapes. The funding model will enable the six ASD members to collectively direct resources to those projects.

“We’re proud to launch the ASD Impact Fund. Together, a number of our members are able to pool their resources to fund projects that support our vision for palm derivatives sourcing that is free from deforestation, respects human rights, and supports local livelihoods,” said Edwina McKechnie, Associate Director, Consumer Sectors at BSR. “This first project will ensure resources go into directly supporting smallholders, landscapes and communities linked to ASD’s supply footprint.”

The primary purpose of ASD is to positively transform industry practices for key derivatives supply chains, and we are pleased to see this work take concrete next steps. The collective impact efforts conducted through ASD will now allow different types of downstream companies, including intermediary players and SMEs, to support on-the-ground actions in strategic palm oil production areas connected to their supply”, added Ariane Denis, Deputy Director, Sustainable sourcing at Transitions.

“Through the Fund, we are able to facilitate impact on-the-ground by providing a mechanism to collect finance from multiple sources, and secure a pipeline of funding to projects in priority production landscapes shared by palm derivatives users.” said Ricki Berkenfeld, Manager, Consumer Sectors at BSR.

Michelle Fargen, Global Head of Procurement and Sustainable Sourcing, Croda, said: “Croda is very happy to be a contributor to the ASD Impact Fund. Our use of palm derived raw materials is fully supported by RSPO Supply Chain Certification, supply chain mapping, and compliance to NPDE principles.

“It has been our desire to participate in direct impact projects to enable further positive results at local levels. The ASD Impact Fund will enable us to do this in partnership with like-minded ASD members. We are excited to see the positive impacts to our local market areas.”

Nancy Mahon, Senior Vice President, Global Corporate Citizenship & Sustainability, The Estée Lauder Companies, said: ”At The Estée Lauder Companies, we know that global challenges require collaborative solutions. That’s why we’re proud to support, through The Estée Lauder Companies Charitable Foundation, the launch of the ASD Impact Fund.

“Responsible palm sourcing and production requires collaboration among like-minded members and with local communities, and we look forward to continuing our commitment to support the local communities in which we live, work and source to drive positive impact on the ground with the Fund.”

Marie Ollagnier, Global CSR Director, Seppic, said: “At Seppic we are proud and excited to contribute to the ASD Impact Fund. Seppic has actively promoted the sustainable transformation of the palm supply chain for years, and our participation in this on-the-ground collective program is a new step for us to further engage at the local level to reach higher positive impacts on the environment and communities.”

Hervé Gondrand, General Manager, Stéarinerie Dubois, said: “Stéarinerie Dubois is proud to be a member of the ASD and glad to provide financial support to the ASD Impact Fund.

“As a Small and Medium Enterprise, our contribution to this fund is a milestone in our strategy for forests, since we joined RSPO in 2011 and embarked all of our industrial customers with a 100% RSPO Mass Balance Supply Chain Certification Standard product offer.

“Building this bridge between the downstream and upstream actors is fully in line with our commitment to make palm oil derivatives sourcing more sustainable, free from deforestation, respectful to human rights and supporting local livelihoods. It provides us a path to the accomplishment of the agenda of the Sustainable Development Goals of the United Nations Global Compact.”

Sarah McDonald, Vice President of Sustainability, GSK Consumer Healthcare, said: “GSK Consumer Healthcare is proud to support the ASD Impact Fund. Addressing the social and environmental barriers that stand in the way of people’s everyday health is fundamental to our company purpose and sourcing commodities, such as palm oil, in a sustainable and inclusive way is a core part of our sustainability strategy. 

“Meaningful collaborations such as this enable us to create positive impact for people and planet in priority areas we source ingredients from, tackling nature loss and protecting human rights.”

More details on the specific project being supported will be announced next month. The project will have an identified need and scope where ASD can add value through pooled funding contributions. In choosing the project ASD assessed:

  • environmental conservation/ restoration potential; 
  • proximity to priority mills and landscapes; 
  • potential to enhance smallholder livelihoods; 
  • how established and robust the project is.

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