Unilever, a company owning 400 brands including Dove, Ponds and Vaseline, announced last week that it would cancel its supplier agreements with palm-oil producer and trader IOI over its involvement in Indonesia’s massive forest fires.

The decision came after IOI was suspended by the Roundtable on Sustainable Palm Oil (RSPO), a group of environmental stakeholders in the global palm-oil sector, according to The Straits Times.

Because of the suspension, IOI’s reputation as a top-10 global palm-oil company was tarnished. Unilever is one of the buyers of IOI palm oil.

Aside from Unilever, reputable US food manufacturers Mars and Kellogg’s have removed IOI as their prime supplier of palm oil. Both companies initiated steps to drop contracts with IOI’s refining subsidiary IOI Loders Croklaan, which has refineries in Malaysia and the Netherlands.

The immediate actions of the three global companies will tremendously affect the palm-oil company’s sales.

Palm and kernel oil are main ingredients in many of the products people consume daily, such as ice cream, biscuits, soaps, shampoos, and many more.

The cancellation of IOI palm-oil contracts will also have a domino effect on Malaysia’s palm-oil industry as other global companies vowed to source their materials from suppliers that don’t violate environmental safety laws and never employ child workers.

Last July, Indonesian forests in West Kalimantan were scorched for weeks after “slash and burn” forest practices caused the forest peatlands to ignite and cause haze. Palm-oil and paper companies were strongly blamed for the environmental catastrophe. –

Philippine Daily Inquirer