Unilever Global Change location
Our approach to protecting and regenerating nature recognises the interdependencies between nature and society. We're tackling deforestation in our supply chain, building regenerative agricultural systems, restoring landscapes and preserving water – bringing communities, partners and technology together. Through collective action, we can prevent the worst impacts of climate change and improve livelihoods.
*Please refer to the relevant target for more information on this metric.
We are transforming our manufacturing infrastructure to bring us closer to our suppliers, increasing our ability to source deforestation-free volumes.
We are implementing regenerative agriculture, and protection and restoration programmes with our partners.
We increased our volumes of sustainably sourced crops during 2022, including palm oil, soy oil, dairy and cereals.
Our programmes in South East Asia are providing training and support to palm smallholder farmers.
We are working with partners and farmers to improve groundwater recharge, rainwater capture and water efficiency in the catchments of our water-stressed sites.
By collaborating with suppliers, partners and academia we are working to find innovative biodegradability solutions.
Our brands have launched pilot programmes to support our climate and nature agenda.
Our aim is to operationalise deforestation-free supply chains so that they become a standard way of working for our five key commodities in scope for this target. We are implementing the systems, processes and infrastructure for a deforestation-free supply chain for these key commodities by the end of 2023.
Our complex supply chain will require a significant transformation in our sourcing of raw materials – given the limited availability of deforestation-free commodity volumes and the highly volatile markets we face. At present, we are measuring and reporting volumes from areas of low deforestation risk as this provides us with an interim measurement of our progress, while we continue to roll out a verification programme for deforestation-free volumes. Our latest data on low-risk volumes is for the 2021 reporting period. 81% of the palm oil, paper and board, tea, soy and cocoa was from areas with a low-risk of deforestation.
One way we are working to achieve a deforestation-free supply chain is by investing in the transformation of our manufacturing infrastructure in North Sumatra. We believe this will bring us closer to our suppliers and simplify our supply chain, increasing our ability to source deforestation-free commodity volumes. In 2022, we began the upgrade of our Unilever Oleochemicals facility, with a spend of €59 million. €70 million is forecasted for further upgrades in 2023. This will help us to source deforestation-free palm kernel oil directly from smallholders who are at the heart of our strategy to deliver a deforestation-free supply chain. These investments are aiming to reach around 40,000 smallholder farmers by 2025.
In addition to securing supply from smallholder farmers, we are taking a number of other actions. Firstly, we are building resilience within our portfolio by adjusting our product formulations to reduce our reliance on commodities that have a high risk of deforestation such as palm oil, with lower-risk alternatives such as coconut oil. Secondly, we are working with partners to build greater traceability and transparency with the help of cutting-edge technology so that we have the tools, processes and systems in place to independently verify our deforestation-free volumes.
We rely on the natural environment for the raw materials and ingredients that we need to make our products. Protecting and regenerating nature, within and beyond our value chain, will increase our capacity to reduce GHG emissions, increase biodiversity and protect water systems while enhancing the resilience of our business.
We have made progress towards our target of helping to protect and regenerate 1.5 million hectares of land, forests and oceans. By the end of 2022, we had played an active role in protecting and regenerating 0.2 million hectares, compared to 0.1 million in 2021. We are focusing our efforts in two areas: regenerative agriculture and protection and restoration programmes.
Our regenerative agriculture programme was formally launched with suppliers in 2022, building on our previous Lighthouse Programmes. These pilot projects helped us to understand the kind of support our suppliers and farmers need to start using regenerative practices. Additionally, we continue to invest in our existing programmes across a range of agricultural commodities, such as soy, rice and vegetables, and we are committed to growing the scope and scale of these in years to come.
Another way we have been progressing towards this goal is through the continuation of our protection and restoration partnerships. For example, we have partnered with local governments as well as Conservation International, WWF, IDH and Inobu as part of our landscape projects across key palm oil production areas in Malaysia and Indonesia. We are also a founding member of the Rimba Collective to support large-scale forest protection and restoration in palm landscapes.
We use many different crops to make our products. Our key agricultural crops make up around two-thirds of our agricultural raw material volumes and include commodities commonly used in our products, such as palm oil, soy oil, dairy and cereals. Securing a sustainable supply of these materials is key to protecting and regenerating the natural ecosystems that we depend on. In 2022, 81% of our key agricultural commodities were sustainably sourced, up from 79% in 2021. In 2022 we maintained or improved our sustainable sourcing performance across all of our key crops.
Palm oil is one of the largest commodities that we buy by volume and an essential ingredient in many of our products. Read more about the work we are doing on sustainable palm oil.
Soy oil is another important ingredient used in products such as Hellmann’s mayonnaise. In 2022, 100% of our soy oil was sustainably sourced, partly through the purchase of soy credits as well as an increase in direct physical sourcing. In Iowa in the US, a key sourcing area, we are working with soy farmers and soy oil suppliers to increase the availability of sustainable volumes at the same time as introducing regenerative farming practices, such as cover crops to protect the soil.
Dairy is used by our Ice Cream brands such as Magnum and Ben & Jerry’s. In 2022, 74% of our dairy volume was sustainably sourced, an increase of 11% versus 2021. This was primarily driven by the onboarding of new dairy suppliers to our Sustainable Sourcing Programme.
We have also developed a roadmap for the sustainable sourcing of cereals, with 44% sustainably sourced in 2022 – an increase of 10% versus 2021. Supplier partnerships play an important role in the delivery of our roadmap. For example, our rice programme in Arkansas in the US is not only helping to increase the yield of rice production and availability of sustainably sourced rice, it is also reducing methane emissions and water use.
Empowering smallholder farmers within and beyond our value chain, alongside improving the livelihoods of smallholder communities, is a key part of our strategy to protect and regenerate nature.
Palm oil is one of our key agricultural commodities and one of our main focus areas for smallholder farmer engagement. In 2022, we released our Reimagining Landscapes report (PDF 13.87 MB) which details progress and learnings from five smallholder farmer programmes in South East Asia. One of the things we are doing in this region is to provide training and support farmer groups to reduce pressure on forests. We are also supporting our suppliers to map and monitor their own supply chains and acquire land titles and cultivation licences – all essential to help us achieve a deforestation-free supply chain by 2023.
We are pooling many of our smallholder programmes into new hubs in Indonesia’s Aceh, North Sumatra, and Riau provinces, linked to independent palm oil mills and their smallholder suppliers. Through these hubs, we will channel our good agricultural practice training and business management initiatives, as well as new modules on issues such as regenerative agriculture and gender equality.
Working with larger farmers through our brands is another important part of this target. In 2022, Knorr continued its programme in Arkansas in the US, in partnership with a supplier to reduce the environmental impact of rice production – increasing yield while reducing methane emissions and water use.
Water forms a critical part of our approach to protecting and regenerating nature. It helps to both mitigate and adapt to the effects of climate change and is also essential for our business – from growing crops to using our products.
The focus of our programmes is on water in the catchment areas of our factories in water-stressed areas. Since we set this target, we have identified a number of our factories to introduce these programmes. By the end of 2022, we had implemented eight water stewardship projects(a) as part of our Prabhat programme in India where we have been working with partners for over eight years to improve rainwater capture and groundwater recharge.
Amongst a range of other interventions in water-stressed basins, the programme aims to strengthen water governance at village level, so communities can decide which crops to grow based on water availability. Prabhat’s water conservation programmes have saved an estimated 50 billion litres of water so far.
Prabhat serves as a model for future water stewardship programmes in other countries. In the coming years, we will work to identify and expand our programmes and partnerships in new catchment areas, to improve water availability and quality.
We want consumers to be confident that the products they use will not leave a physical trace on the environment. Practically, this means that our products must break down completely to their component parts – carbon dioxide, water and mineral salts – and then return to the earth’s natural cycles within hours, days or, at most, weeks.
Our Home Care Business Group is innovating with new types of polymers and other ingredients that leave no trace behind. For example, in France, we introduced Skip 3-in-1 laundry capsules with more biodegradable active ingredients which work in short cycles and cold water. Sunlight dishwash was also relaunched in Thailand with a 99% biodegradable formulation.
Our Beauty & Wellbeing Business Group is trialling biodegradable alternatives to silicone hair conditioners to get the same or better conditioning performance, with improved biodegradability. Some of the ingredients that we currently use have no viable biodegradable alternatives, so we are collaborating with fragrance suppliers and partners to develop fragrances with higher levels of biodegradability.
We recognise that this goal creates a tension with our net zero target because when products biodegrade, they break down into their component parts, which could include CO2, producing additional emissions. We remain focused on increasing our use of renewable and recycled ingredients which will lower GHG emissions as our products biodegrade.
Our Climate & Nature Fund was launched in 2020 and aims to connect value chain transformation with our brands. This will help us to take targeted action to address climate change, protect nature and grow responsibly – ultimately helping us achieve our net zero ambition. By the end of 2022, we had spent and committed over €200 million.
A number of our brands are working on projects. Knorr is launching 50 projects in collaboration with farmers to reduce and remove greenhouse gas emissions and reduce water consumption, while improving biodiversity, soil health and livelihoods. One project is using satellite data and digital sensors to help tomato farmers in the south of Spain optimise their water use as well as improving soil health through cover cropping. Crucially, Knorr will bring consumers along on the journey, by communicating the benefits of this approach.
Dairy products are a priority raw material used by our Ice Cream brands such as Wall’s, Magnum and Ben & Jerry’s. Ben & Jerry’s is working on a pilot project with 15 dairy farms across the US and Europe to develop a potentially game-changing initiative which aims to reduce GHG emissions by up to half of the industry average, by the end of 2024. The pilot will use a mixture of new technology and regenerative agricultural practices to reduce emissions across three focus areas: cow (ruminant) digestion, manure management and soil. We will use lessons from this initiative to develop scalable ways of making dairy farming less carbon-intensive.
We are also working with partners to finance regeneration and restoration programmes beyond our value chain. For example, we are a founding member of the Rimba Collective Fund to support the protection and restoration of at least 500,000 hectares of forests and lands in Asia over the next five years. And, together with private equity fund Tikehau and AXA, we have committed €100 million to a Regenerative Agriculture Fund. All investments made by the fund aim to generate a long-term, positive impact on atmospheric carbon, ecosystem biodiversity and water management, using tools such as land restoration and regenerative agriculture.
Measured for 12 month period ended 30 September.
