Developing responsible sourcing policies in the palm oil industry 'palm oilImplementation and monitoring of responsible sourcing policyConclusion and recommendationsReferencesIntroduction and business drivers for the development of responsible sourcing policies. The supply chain is one of the organization's most strategic assets. The supply chain is a highly detailed process used by all types of organizations to obtain goods from suppliers, use them for production, and then deliver the final product to the end user. An optimized supply chain creates value for the organization throughout the lifecycle by not only enabling cost reduction and budget optimization, but also helping to generate greater operational and market efficiencies (Glass, Achour, Parry and Nicholson , 2012). Recent globalization and industrialization has brought changes to the business environment, allowing organizations to redefine their approach to procurement for greater sustainability. Specific factors such as environmental degradation, rising stakeholder expectations, cost volatility and compliance standards pose many risks to organizations, motivating the shift to more sustainable sourcing. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an original essay A responsible sourcing policy refers to “the integration of social, ethical, and environmental performance factors into the development of a supply chain policy” (Pagell and Wu 2009, page 37). The purpose of the responsible sourcing policy is to serve as a scale of continuous improvement that serves as a benchmark for sourcing practices. Companies engage in responsible sourcing policy to guide decision making and practice in procurement and supply chain management with the goal of creating competitive advantage and improved environmental outcomes (Skinner, 2013). A responsible sourcing policy encourages suppliers to adopt more environmentally friendly raw material production standards, enabling organizations to push for better environmental outcomes. (Glass, Achour, Parry, & Nicholson, 2012) The purpose of this report is to analyze two case studies involving responsible sourcing policy in the palm oil sector. One of the case studies will involve the analysis of Unilever, as an organization with good policing strategies, while the other case analysis will evaluate Mondelez, a company with bad policing strategies regarding palm oil. Both companies are involved in the production and distribution of food and beverages and are therefore suitable for the case analysis. The case analysis will lead to an analysis of the issues and challenges associated with the sourcing of palm oil. Case study evaluation Reasonable policy has been used as a tool to encourage progress towards reducing deforestation and improving palm oil production standards (Carlson and Curran, 2013, p347). Unilever is a British company with headquarters in London, United Kingdom and Rotterdam, Netherlands. The company deals with the production and distribution of “food, drinks, cleaning materials and personal care products (Unilever, 2018). According to the company website, the company's ambition is to becomeglobal leader in the development of responsible sourcing policies. The company hopes to operate in a way that generates positive environmental outcomes, achieves economic goals and improves social well-being. One of the sectors affected by the responsible police is the sourcing of palm oil, used in the production of all Unilever products. Unilever is currently phasing out suppliers without evidence of “no-deforestation policies,” thus encouraging suppliers to adopt more sustainable production methods (Lim, Parish, & Suharto, 2017). The aim of the responsible police is to ensure that all palm oil comes from suppliers not linked to deforestation. As part of the policy, the company must disclose its palm oil supply. Responsibility measures have resulted in the company achieving a sustainability rate of 88.5%, which is significantly high (Mclean, 2017). Unilever's responsible sourcing policy is underpinned by twelve core principles and is also strategically aligned to the overall strategic plan. of the company. (Glass, Achour, Parry, & Nicholson, 2012) For Unilever, reducing environmental footprint is not only seen as a platform for business growth and competitive advantage, but a platform for encouraging sustainable development and efficiency of supply chain (Unilever, 2018). The policing framework is based on three main aspects of performance which include: mandatory requirements, good and best practices. Mandatory sourcing policy requirements require all suppliers to be accountable for their own palm production practices. All suppliers must be accredited for safe sourcing of palm oil and also have an “anti-deforestation policy”. Suppliers must also be willing to adhere to the core principles developed by Unilever for sustainable supply chain practices. The aspect of good practices and best practices is based on the commitment to ensure socially responsible behavior from the point of supply to the point of sale (Unilever, 2018). The Core Principles outline the mandatory requirements that suppliers must meet to work with Unilever. The fundamental principles underlying the responsible sourcing policy are flexibly designed to ensure continuous improvement in response to the ever-changing business environment. The principles state that all activities must be conducted legally and with integrity. All suppliers must have clear and effective guidelines outlining their expectations for business integrity. The guidelines and policies presented must comply with the regulatory context and describe the criteria for addressing conflict of interest situations. Both Unilever and suppliers must have a plan to provide annual training to employees to ensure they reflect the organisation's sustainability culture in their decision making (Unilever, 2018). Any form of non-compliance entails sanctions and breach of contract. Suppliers must disclose adequate and well-maintained books and financial statements, demonstrating compliance with standard financial standards and procedures. Employees must work freely but according to agreed working conditions. All staff members must be treated fairly and equally, regardless of their skills, occupation or background. All workers must be paid in full and must be respected despite their age. It is wrong to force work on any of your employees. Community well-being will be promoted at all times, including indigenous communities. All business operations must beconducted in an environmentally friendly manner and enhancing sustainability. This means that “operations, procurement, production, distribution of products and provision of services must be conducted with the utmost respect for the environment” (Unilever, 2018). The second aspect of the policy framework is the achievement of good practices. The doctrine of good practices requires that all guidelines and procedures relating to the responsible sourcing policy are provided to all employees in a convenient manner. Unilever must engage in the active monitoring, evaluation and management of supplier activities directly associated with supplier operations. The policy states that Unilever must establish adequate procedures regarding the monitoring of the ethical and compliance standards of all suppliers and their workers. To ensure good practices, it is necessary to conduct periodic reviews on suppliers with the aim of continuously evaluating their level of compliance and ethical conduct (Unilever, 2018). It is necessary to offer continuous training and development to all employees to ensure sound decision-making skills for more sustainable results. All complaints regarding sustainable practices should be forwarded to the supplier's executive director, and the organization should also practice open communication to encourage employees to contribute and comment on sustainability efforts. To achieve best practices, additional policies need to be generated in collaboration with relevant stakeholders with the aim of ensuring that compliance risks are avoided and that the implementation of organizational policies is practical and feasible. (Glass, Achour, Parry, & Nicholson, 2012) Achieving best practices also requires that all contractors train and develop their employees with the aim of orienting them towards the organization's sustainability culture. The identity of people who report concerns about the practice is kept anonymous and will not be available for victimization. The business plan must include objectives for achieving environmental sustainability to ensure that the organization remains focused on achieving these standards. However, for a company like Mondelez, the official manufacturer of “Oreo” and “Nutter Butter”, had poor oversight in sourcing. palm oil, achieving a sustainability score of 30% according to EcoWatch statistics (Mclean, 2017). According to the Greenpeace organization report (2017), Oreo purchases its palm oil from Wilmar. Wilmar is considered the poorest and most unethical palm oil producer in the world. Although Mondelez made commitments towards sustainability in 2007, the implementation of the responsible sourcing policy was not achieved system-wide as the company regularly received consumer complaints about its products. use of bad palm oil. While most responsible and committed organizations are part of an initiative to only use palm oil whose source is certified by the RSPO, Mondelez has not taken part in this initiative. Both Mondelez and Wilmar have failed to respond to consumer and stakeholder calls to clean up their supply chain with the aim of building reforms in the palm oil sector. Wilmar International obtains 80% of its palm oil from third-party suppliers who are not monitored or controlled as the company does not have a policy to do so (Bai et al 2017, p.93). The company promised to clean up its supply chain in 2007 and even developed a responsible sourcing plan aimed at driving more sustainable practices. Mondelez however continued tosourcing unethically produced palm oil from companies that continue to clear forests for palm oil production (Greenpeace organization, 2017). Issues and challenges regarding the development of “responsible policing” in the palm oil industry The development of a responsible sourcing policy for palm oil has been a controversial issue. Modern organizations have regularly been accused of not seeking alternative means of production and at the same time increasing the production of consumer goods, which has instead put pressure on palm oil suppliers to increase production. More than half of all human consumer goods are made up of palm oil, making it a very valuable input in various organizations (Brack, Glover, and Wellesley 2016). Palm oil is used in numerous consumer products and is therefore in high demand worldwide. However, palm oil only works well in tropical regions such as southwestern Asia, where 85% of all the world's palm oil comes from (Hidayat, Offermans, and Glasbergen 2018, p232). The remaining 15% is grown in areas of Africa and South America, where the climate is favourable. As organizations strive to expand their profitability, increasing production capacity plays an important role in increasing the quantity of sales which leads to revenue growth. (Bai et al 2017, p.95) This means that although there are sustainability efforts towards palm oil production, the demand for palm oil has continued to grow.increase. Traditional farms can no longer meet demand, a factor that has motivated various producers to seek unethical means to produce more palm oil. The palm oil business is very profitable and has encouraged more and more suppliers to destroy forests with the aim of creating more land for palm cultivation. According to Bai et al (2017, p.93), palm oil production is expected to grow at double the current level of production by 2050, placing even greater pressure on vulnerable environmental resources. Inconsistency in government regulation against palm oil due to economic dependence on the product has encouraged the growth of poor palm oil production practices. Companies like Wilmar and Sime Darby have a poor reputation for environmental sustainability, but have since won contracts to expand their operations into the Uganda, Liberia and South African regions. Some palm oil companies are run and managed by high government officials and other elite people, which makes control very difficult. (Skinner, 2013) According to Dixon (2016), 11% of palm oil production in Indonesia is controlled by the government. Unfortunately, palm oil is responsible for deforestation and peatland destruction in areas such as Indonesia where it primarily comes from. Palm oil production has also been associated with the loss of indigenous communities, poor working conditions, and child labor (Department of Labor, 2013). Indonesian forests are vast and are considered a powerful weapon against climate change. The forests are also home to some endangered species such as “Sumatra tigers, elephants and orangutans” (Schlegel, 2016). Indonesia is the world's largest producer of palm oil and so far 31 hectares of forest have been cleared away with the aim of paving the way for further palm oil plantations. Indonesia is considered the country with the highest rate of deforestation. In Malaysia, 10 million hectares of land once covered by forests have been used for palm oil production. (Glass, Achour, Parryand Nicholson, 2012) Across the Southeast Asian region, it is estimated that more than ten million people depend on the palm oil industry as a source of livelihood (Brack, Glover, and Wellesley 2016). While activists are calling for more sustainable practices, there has been a lot of uncertainty about alternative sources of income and what people would do if they didn't engage in palm oil production. The conflict of interest experienced between environmental sustainability and economic sustainability has led people to focus more on their own economic interests. The GDP of countries such as Indonesia, Singapore and Malaysia is strongly supported by palm oil production. According to Brack, Glover, and Wellesley (2016), palm oil accounts for almost half of Malaysia's national GDP in terms of the production and processing of palm oil-related products. In Indonesia alone, more than 4 million people are employed in the palm oil industry. Palm oil production is a pillar of economic performance as palm oil production and manufacturing contributes 30% to GDP, significantly increasing economic performance (Ministry of Forestry, 2014). In 2014, Indonesia reached a GDP of $878 billion, emerging 16th in the world GDP ranking (Dixon 2016). Singapore is considered the financial center for palm oil growers and producers in surrounding countries as the country provides financial resources, loans and investments of various types. Switching to alternative sources of petroleum and palm oil elements is not a solution, making sustainability efforts even more important. uncertain (May-Tobin et al, 2012). Palm oil is the most efficient and economical vegetable oil to produce. The use of palm oil is also inextricably linked to consumer goods in the global market, meaning that large organizations would have to collapse if palm oil were to take over production. Palm oil makes up 50% of all consumer packaged products, meaning 100% elimination of palm oil cannot be considered (May-Tobin et al, 2012). So the debate remains between using bad palm oil and good palm oil. Good palm oil is produced in arid lands, while bad palm oil is produced in forested areas. The irony of palm oil sourcing is that, although some suppliers are believed to operate ethically, ten years ago the land used to grow palm oil in the modern world was still forested area. Huge brands such as Nestlé, PepsiCo, Colgate, General mills and others purchase products from suppliers found to be actively deforesting forests in the early 21st century (Environmental Protection Agency, 2013). Despite the responsible police, companies have grown thanks to the economic benefits resulting from the expansion of the palm industry. Furthermore, research conducted by Glass, Achour, Parry, and Nicholson (2012) showed that switching to other sources of oil could lead to 4-5 times the amount of land currently used for palm oil production, in order to meet current demand. Switching to alternatives would therefore mean greater deforestation and land destruction in more parts of the world. Consumer product manufacturing companies from areas such as Malaysia and Singapore have also established poor records in palm oil sustainability. This is a significant challenge given that Malaysia and Singapore are also sources of palm oil for the global market. While most global organizations have been motivated to redefine their supply chains to meet stakeholder expectations,organizations in Malaysia, Singapore and other areas have no incentive towards developing sustainable sourcing and manufacturing policies. According to Schlegel (2016), one of the main incentives towards adopting an open responsible sourcing policy is the emergence of ethical consumerism. Ethical consumerism has emerged as a consumer trend for most countries, signifying consumers' preference for ethically produced and environmentally safe products. As organizations strive to maintain a competitive advantage, they have had a great incentive from changing consumer behaviors (Bessou et al, 2017). However, statistics conducted in Malaysia and Singapore have shown that consumers are not aware of the need to promote sustainable organizational practices, making local organizations very reluctant to promote sustainable palm oil sourcing practices (Hong 2017). A survey conducted by Hong (2017) showed that consumer interest in sourcing sustainable palm oil was low and created little incentive for local organizations to adopt sustainable palm oil as it is considered expensive. Implementing and Monitoring Responsible Sourcing Policing To support due diligence and compliance assurance processes through responsible sourcing policing, various types of audits are needed to ensure that organizations remain committed to achieving their sustainability goals ( Thompson et al 2013). Organizations should start by conducting a risk impact assessment with the goal of identifying suppliers associated with the highest risk. Suppliers with higher risks should undergo desk audits, assessing their policy and procedural frameworks, as well as the level of compliance with relevant laws and requirements (Schlegel 2016). An on-site audit must be conducted on all raw materials and finished products to ensure that high quality and environmentally friendly products are supplied. Employees are identified as the factors that determine the achievement of organizational objectives. An organization cannot achieve its business goals or objectives without the support and collaboration of employees. The implementation of the responsible policing process should involve favorable change management processes that are collaborative and participatory, as well as motivation strategies aimed at inspiring employee work engagement (Bessou et al, 2017). Quality change management offers training to employees regarding the new philosophies, methods and procedures involved in apolitics, which eliminates resistance to change. Motivational strategies, on the other hand, inspire positive work behaviors and attitudes that make employees engaged in their work. Engaged employees care more about their productivity as it is seen as part of their identity and will therefore strive to be productive. The success of implementing a plan is strongly determined by employee perceptions and attitudes toward the policy. Since implementation cannot be done without employee collaboration, promoting a healthy work environment should be a priority to ensure successful policy implementation. Additionally, leaders should promote a supportive organizational culture that emphasizes the need for ethics, professionalism, and diversity (Schlegel 2016). Organizational culture provides a favorable environment for policies to work and can therefore form a favorable basis for the implementation of responsible sourcing policy. TheOrganizations must maintain good relationships with suppliers and contribute to supplier development. As an approach to ensuring adequate implementation and monitoring, contracting organizations should provide recommendations for improvement and even participate in collaborative training and employee development to promote a culture of cooperation (Bessou et al, 2017). Procuring organizations can also share technological resources and directly fund research and development projects aimed at improving suppliers' sustainability practices. The supplier must also be given the opportunity to reform and correct its policies before receiving any sanctions. If an audit reveals a failure to comply with agreed terms, the supplier must be willing to develop an immediate corrective action plan aimed at correcting the situation, failure to comply with which the supplier will be charged for breach of contract (Thompson et al, 2013) . Management should devise strategic tools aimed at measuring the actual performance of policy objectives against expected outcomes. Continuous monitoring of performance indicators can help identify weaknesses and opportunities in the supply chain, enabling proactive risk management and capitalization of opportunities (Hidayat, Offermans, and Glasbergen 2018, p232). Performance evaluation tools include sustainability scorecards designed to evaluate a company's environmental performance in various operational areas. Please note: this is just an example. Get a custom paper from our expert writers now. Get a Custom Essay Conclusion and Recommendations Palm oil is a valuable commodity from which the global economy as it contributes to the production of a variety of consumer goods, supports economies and provides employment. However, palm oil production contributes significantly to the destruction of forests, the loss of biodiversity, the loss of indigenous communities and the encouragement of poor labor practices. As organizations move towards more sustainable models, adopting responsible policy to facilitate sustainable development is very important. Responsible sourcing policy will provide organizations with a rationale to follow when making supplier decisions, which in turn will help shape suppliers' manufacturing practices. To limit the negative effects of palm oil production, all brands using palm oil are advised to take responsibility for developing their own policies to ensure they support sustainable supply chains. The goal should be to avoid all companies that use forest land to grow and produce palm oil and only work with those companies that do not destroy forest land. Organizations can also create palm oil sustainability campaigns as part of implementing their policies, to help encourage ethical consumerism and environmental awareness. References Bai, B., Wang, L., Lee, M., Zhang, Y., Alfiko, Y., Ye, B.Q., Wan, Z.Y., Lim, C.H., Suwanto, A., Chua, N.H., & Yue, G.H. , 2017. Genome-wide identification of markers to select for higher oil content in oil palm. BMC Plant Biology, 17(1), p.93.Brack,D., Glover, A. and Wellesley, L., 2016. Agricultural commodity supply chains. Available at: https://www.chathamhouse.org/sites/files/chathamhouse/publications/research/2016-01-28-agricultural-commodities-brack-glover-wellesley.pdfBessou, C., Rival, A., Levang , P., Feintrenie, L., Bosc, P.M., Cheyns, E., Djama, M., Wohlfahrt, J., Marichal, R., Roda, J.M. and Caliman, J.P., 2017.Sustainable palm oil production project summary: Understanding and anticipating global challenges (Vol. 165). CIFOR.Carlson, K.M. and L.M. Curran. 2013. Refined carbon accounting for oil palm agriculture: distinguishing the potential contributions of indirect and smallholder emissions. Carbon Management 4(4):347–349.Department of Labor, 2013. List of goods produced by child labor or forced labor. Washington, DC. Online at www.dol.gov/ilab/reports/child-labor/list-of-goodsDixon, KD, 2016. Palm oil expansion in Indonesia and its further contribution to economic fragility. Environmental Protection Agency (EPA). 2013. United States Greenhouse Gas Emissions and Sink Inventory: 1990–2011. EPA 430-R-13-001. Washington, DC. Online at www.epa.gov/climatechange/Downloads/ghgemissions/US-GHG-Inventory-2013-Main-Text. pdf,Glass, J., Achour, N., Parry, T. and Nicholson, I., 2012. Engaging small businesses in sustainable supply chains: responsible sourcing practices in the UK construction sector. Greenpeace Organization (2017), Oreo: Stop rainforest destruction! Tell Oreo to drop the dirty palm oil. Available at: http://www.greenpeace.org/?_ga=2.16604543.871775990.1546945687-1190573608.1546945687Hidayat, N.K., Offermans, A. and Glasbergen, P., 2018. Sustainable palm oil as a public responsibility? On the governance capacity of the Indonesian Standard for Sustainable Palm Oil (ISPO). Agriculture and Human Values, 35(1), pp.223-242.Unilever (2018), Our responsible sourcing policy in action, available at: https://www.unilever.com/sustainable-living/enhancing -livelihoods/fairness-in-the-workplace/promoting-human-rights-with-suppliers-and-business-partners/our-responsible-sourcing-policy-in-action/Hong, TH 2017 , Poor response for sustainable palm oil, Available at: https://www.minimeinsights.com/Lim, KH, SS im, F. Parish, and R. Suharto. 2017. RSPO Best Management Practice (BMP) Manual for Existing Oil Palm Cultivation on Peat. Kuala Lumpur: Roundtable on Sustainable Palm Oil. Online at www.rspo.org/file/RSPO_BMP_1_Update_24_April_2013_small.pdf, accessed 19 January 2014Margono et al., 2014. Loss of primary forest cover in Indonesia 2000–2012. Natural climate changes. www.nature.com/nclimate/journal/v4/n8/full/nclimate2277.May-Tobin, C., D. Boucher, E. Decker, G. Hurowitz, J. Martin, K. Mulik, S. Roquemore and R Stark. 2012. Recipes for Success: Deforestation-Free Vegetable Oil Solutions. Cambridge, MA: Union of Concerned Scientists and Climate Advisers.Ministry of Forestry (2014) Statistik Kementerian Kehutanan/Ministry of Forestry, Indonesia 2013, Ministry of Forestry, July 2014Ministry of Environment and Forestry (2014) Deforestasi Indonesia Tahun 2012-2013 , Kementarian Lingkungan Hidup dan Kehutanan, 2014Pagell, M. and Wu, Z., 2009. Building a more comprehensive theory of sustainable supply chain management using case studies of 10 examples. Journal of supply chain management, 45(2), pp.37-56.Schlegel, I. 2016, Palm Oil Scorecard: Are brands doing enough for Indonesia's rainforests? Available at: https://www.greenpeace.org/usa/palm-oil-scorecard-are-brands-doing-enough-for-indonesias-rainforests/blog/Skinner, EB 2013. The Indonesian palm oil industry Palma is full of human rights violations. Bloomberg Businessweek, July 18. Online at www. businessweek.com/articles/2013-07-18/indonesias-palm-oil-industryrife-with-human-rights-abuses, accessed January 2014.Thompson, ID, MR Guariguata, K. Okabe, C. Bahamondez, R Nasi, V. Heymell and C. Sabogal. 2013. An operational framework for defining and monitoring forest degradation. Ecology and Society 18(2):20.WWF 5(19):1

Topic > Developing responsible sourcing policies in the palm oil industry 'palm oilImplementation and monitoring of responsible sourcing policyConclusion and recommendationsReferencesIntroduction and business drivers for the development of responsible sourcing policies. The supply chain is one of the organization's most strategic assets. The supply chain is a highly detailed process used by all types of organizations to obtain goods from suppliers, use them for production, and then deliver the final product to the end user. An optimized supply chain creates value for the organization throughout the lifecycle by not only enabling cost reduction and budget optimization, but also helping to generate greater operational and market efficiencies (Glass, Achour, Parry and Nicholson , 2012). Recent globalization and industrialization has brought changes to the business environment, allowing organizations to redefine their approach to procurement for greater sustainability. Specific factors such as environmental degradation, rising stakeholder expectations, cost volatility and compliance standards pose many risks to organizations, motivating the shift to more sustainable sourcing. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an original essay A responsible sourcing policy refers to “the integration of social, ethical, and environmental performance factors into the development of a supply chain policy” (Pagell and Wu 2009, page 37). The purpose of the responsible sourcing policy is to serve as a scale of continuous improvement that serves as a benchmark for sourcing practices. Companies engage in responsible sourcing policy to guide decision making and practice in procurement and supply chain management with the goal of creating competitive advantage and improved environmental outcomes (Skinner, 2013). A responsible sourcing policy encourages suppliers to adopt more environmentally friendly raw material production standards, enabling organizations to push for better environmental outcomes. (Glass, Achour, Parry, & Nicholson, 2012) The purpose of this report is to analyze two case studies involving responsible sourcing policy in the palm oil sector. One of the case studies will involve the analysis of Unilever, as an organization with good policing strategies, while the other case analysis will evaluate Mondelez, a company with bad policing strategies regarding palm oil. Both companies are involved in the production and distribution of food and beverages and are therefore suitable for the case analysis. The case analysis will lead to an analysis of the issues and challenges associated with the sourcing of palm oil. Case study evaluation Reasonable policy has been used as a tool to encourage progress towards reducing deforestation and improving palm oil production standards (Carlson and Curran, 2013, p347). Unilever is a British company with headquarters in London, United Kingdom and Rotterdam, Netherlands. The company deals with the production and distribution of “food, drinks, cleaning materials and personal care products (Unilever, 2018). According to the company website, the company's ambition is to becomeglobal leader in the development of responsible sourcing policies. The company hopes to operate in a way that generates positive environmental outcomes, achieves economic goals and improves social well-being. One of the sectors affected by the responsible police is the sourcing of palm oil, used in the production of all Unilever products. Unilever is currently phasing out suppliers without evidence of “no-deforestation policies,” thus encouraging suppliers to adopt more sustainable production methods (Lim, Parish, & Suharto, 2017). The aim of the responsible police is to ensure that all palm oil comes from suppliers not linked to deforestation. As part of the policy, the company must disclose its palm oil supply. Responsibility measures have resulted in the company achieving a sustainability rate of 88.5%, which is significantly high (Mclean, 2017). Unilever's responsible sourcing policy is underpinned by twelve core principles and is also strategically aligned to the overall strategic plan. of the company. (Glass, Achour, Parry, & Nicholson, 2012) For Unilever, reducing environmental footprint is not only seen as a platform for business growth and competitive advantage, but a platform for encouraging sustainable development and efficiency of supply chain (Unilever, 2018). The policing framework is based on three main aspects of performance which include: mandatory requirements, good and best practices. Mandatory sourcing policy requirements require all suppliers to be accountable for their own palm production practices. All suppliers must be accredited for safe sourcing of palm oil and also have an “anti-deforestation policy”. Suppliers must also be willing to adhere to the core principles developed by Unilever for sustainable supply chain practices. The aspect of good practices and best practices is based on the commitment to ensure socially responsible behavior from the point of supply to the point of sale (Unilever, 2018). The Core Principles outline the mandatory requirements that suppliers must meet to work with Unilever. The fundamental principles underlying the responsible sourcing policy are flexibly designed to ensure continuous improvement in response to the ever-changing business environment. The principles state that all activities must be conducted legally and with integrity. All suppliers must have clear and effective guidelines outlining their expectations for business integrity. The guidelines and policies presented must comply with the regulatory context and describe the criteria for addressing conflict of interest situations. Both Unilever and suppliers must have a plan to provide annual training to employees to ensure they reflect the organisation's sustainability culture in their decision making (Unilever, 2018). Any form of non-compliance entails sanctions and breach of contract. Suppliers must disclose adequate and well-maintained books and financial statements, demonstrating compliance with standard financial standards and procedures. Employees must work freely but according to agreed working conditions. All staff members must be treated fairly and equally, regardless of their skills, occupation or background. All workers must be paid in full and must be respected despite their age. It is wrong to force work on any of your employees. Community well-being will be promoted at all times, including indigenous communities. All business operations must beconducted in an environmentally friendly manner and enhancing sustainability. This means that “operations, procurement, production, distribution of products and provision of services must be conducted with the utmost respect for the environment” (Unilever, 2018). The second aspect of the policy framework is the achievement of good practices. The doctrine of good practices requires that all guidelines and procedures relating to the responsible sourcing policy are provided to all employees in a convenient manner. Unilever must engage in the active monitoring, evaluation and management of supplier activities directly associated with supplier operations. The policy states that Unilever must establish adequate procedures regarding the monitoring of the ethical and compliance standards of all suppliers and their workers. To ensure good practices, it is necessary to conduct periodic reviews on suppliers with the aim of continuously evaluating their level of compliance and ethical conduct (Unilever, 2018). It is necessary to offer continuous training and development to all employees to ensure sound decision-making skills for more sustainable results. All complaints regarding sustainable practices should be forwarded to the supplier's executive director, and the organization should also practice open communication to encourage employees to contribute and comment on sustainability efforts. To achieve best practices, additional policies need to be generated in collaboration with relevant stakeholders with the aim of ensuring that compliance risks are avoided and that the implementation of organizational policies is practical and feasible. (Glass, Achour, Parry, & Nicholson, 2012) Achieving best practices also requires that all contractors train and develop their employees with the aim of orienting them towards the organization's sustainability culture. The identity of people who report concerns about the practice is kept anonymous and will not be available for victimization. The business plan must include objectives for achieving environmental sustainability to ensure that the organization remains focused on achieving these standards. However, for a company like Mondelez, the official manufacturer of “Oreo” and “Nutter Butter”, had poor oversight in sourcing. palm oil, achieving a sustainability score of 30% according to EcoWatch statistics (Mclean, 2017). According to the Greenpeace organization report (2017), Oreo purchases its palm oil from Wilmar. Wilmar is considered the poorest and most unethical palm oil producer in the world. Although Mondelez made commitments towards sustainability in 2007, the implementation of the responsible sourcing policy was not achieved system-wide as the company regularly received consumer complaints about its products. use of bad palm oil. While most responsible and committed organizations are part of an initiative to only use palm oil whose source is certified by the RSPO, Mondelez has not taken part in this initiative. Both Mondelez and Wilmar have failed to respond to consumer and stakeholder calls to clean up their supply chain with the aim of building reforms in the palm oil sector. Wilmar International obtains 80% of its palm oil from third-party suppliers who are not monitored or controlled as the company does not have a policy to do so (Bai et al 2017, p.93). The company promised to clean up its supply chain in 2007 and even developed a responsible sourcing plan aimed at driving more sustainable practices. Mondelez however continued tosourcing unethically produced palm oil from companies that continue to clear forests for palm oil production (Greenpeace organization, 2017). Issues and challenges regarding the development of “responsible policing” in the palm oil industry The development of a responsible sourcing policy for palm oil has been a controversial issue. Modern organizations have regularly been accused of not seeking alternative means of production and at the same time increasing the production of consumer goods, which has instead put pressure on palm oil suppliers to increase production. More than half of all human consumer goods are made up of palm oil, making it a very valuable input in various organizations (Brack, Glover, and Wellesley 2016). Palm oil is used in numerous consumer products and is therefore in high demand worldwide. However, palm oil only works well in tropical regions such as southwestern Asia, where 85% of all the world's palm oil comes from (Hidayat, Offermans, and Glasbergen 2018, p232). The remaining 15% is grown in areas of Africa and South America, where the climate is favourable. As organizations strive to expand their profitability, increasing production capacity plays an important role in increasing the quantity of sales which leads to revenue growth. (Bai et al 2017, p.95) This means that although there are sustainability efforts towards palm oil production, the demand for palm oil has continued to grow.increase. Traditional farms can no longer meet demand, a factor that has motivated various producers to seek unethical means to produce more palm oil. The palm oil business is very profitable and has encouraged more and more suppliers to destroy forests with the aim of creating more land for palm cultivation. According to Bai et al (2017, p.93), palm oil production is expected to grow at double the current level of production by 2050, placing even greater pressure on vulnerable environmental resources. Inconsistency in government regulation against palm oil due to economic dependence on the product has encouraged the growth of poor palm oil production practices. Companies like Wilmar and Sime Darby have a poor reputation for environmental sustainability, but have since won contracts to expand their operations into the Uganda, Liberia and South African regions. Some palm oil companies are run and managed by high government officials and other elite people, which makes control very difficult. (Skinner, 2013) According to Dixon (2016), 11% of palm oil production in Indonesia is controlled by the government. Unfortunately, palm oil is responsible for deforestation and peatland destruction in areas such as Indonesia where it primarily comes from. Palm oil production has also been associated with the loss of indigenous communities, poor working conditions, and child labor (Department of Labor, 2013). Indonesian forests are vast and are considered a powerful weapon against climate change. The forests are also home to some endangered species such as “Sumatra tigers, elephants and orangutans” (Schlegel, 2016). Indonesia is the world's largest producer of palm oil and so far 31 hectares of forest have been cleared away with the aim of paving the way for further palm oil plantations. Indonesia is considered the country with the highest rate of deforestation. In Malaysia, 10 million hectares of land once covered by forests have been used for palm oil production. (Glass, Achour, Parryand Nicholson, 2012) Across the Southeast Asian region, it is estimated that more than ten million people depend on the palm oil industry as a source of livelihood (Brack, Glover, and Wellesley 2016). While activists are calling for more sustainable practices, there has been a lot of uncertainty about alternative sources of income and what people would do if they didn't engage in palm oil production. The conflict of interest experienced between environmental sustainability and economic sustainability has led people to focus more on their own economic interests. The GDP of countries such as Indonesia, Singapore and Malaysia is strongly supported by palm oil production. According to Brack, Glover, and Wellesley (2016), palm oil accounts for almost half of Malaysia's national GDP in terms of the production and processing of palm oil-related products. In Indonesia alone, more than 4 million people are employed in the palm oil industry. Palm oil production is a pillar of economic performance as palm oil production and manufacturing contributes 30% to GDP, significantly increasing economic performance (Ministry of Forestry, 2014). In 2014, Indonesia reached a GDP of $878 billion, emerging 16th in the world GDP ranking (Dixon 2016). Singapore is considered the financial center for palm oil growers and producers in surrounding countries as the country provides financial resources, loans and investments of various types. Switching to alternative sources of petroleum and palm oil elements is not a solution, making sustainability efforts even more important. uncertain (May-Tobin et al, 2012). Palm oil is the most efficient and economical vegetable oil to produce. The use of palm oil is also inextricably linked to consumer goods in the global market, meaning that large organizations would have to collapse if palm oil were to take over production. Palm oil makes up 50% of all consumer packaged products, meaning 100% elimination of palm oil cannot be considered (May-Tobin et al, 2012). So the debate remains between using bad palm oil and good palm oil. Good palm oil is produced in arid lands, while bad palm oil is produced in forested areas. The irony of palm oil sourcing is that, although some suppliers are believed to operate ethically, ten years ago the land used to grow palm oil in the modern world was still forested area. Huge brands such as Nestlé, PepsiCo, Colgate, General mills and others purchase products from suppliers found to be actively deforesting forests in the early 21st century (Environmental Protection Agency, 2013). Despite the responsible police, companies have grown thanks to the economic benefits resulting from the expansion of the palm industry. Furthermore, research conducted by Glass, Achour, Parry, and Nicholson (2012) showed that switching to other sources of oil could lead to 4-5 times the amount of land currently used for palm oil production, in order to meet current demand. Switching to alternatives would therefore mean greater deforestation and land destruction in more parts of the world. Consumer product manufacturing companies from areas such as Malaysia and Singapore have also established poor records in palm oil sustainability. This is a significant challenge given that Malaysia and Singapore are also sources of palm oil for the global market. While most global organizations have been motivated to redefine their supply chains to meet stakeholder expectations,organizations in Malaysia, Singapore and other areas have no incentive towards developing sustainable sourcing and manufacturing policies. According to Schlegel (2016), one of the main incentives towards adopting an open responsible sourcing policy is the emergence of ethical consumerism. Ethical consumerism has emerged as a consumer trend for most countries, signifying consumers' preference for ethically produced and environmentally safe products. As organizations strive to maintain a competitive advantage, they have had a great incentive from changing consumer behaviors (Bessou et al, 2017). However, statistics conducted in Malaysia and Singapore have shown that consumers are not aware of the need to promote sustainable organizational practices, making local organizations very reluctant to promote sustainable palm oil sourcing practices (Hong 2017). A survey conducted by Hong (2017) showed that consumer interest in sourcing sustainable palm oil was low and created little incentive for local organizations to adopt sustainable palm oil as it is considered expensive. Implementing and Monitoring Responsible Sourcing Policing To support due diligence and compliance assurance processes through responsible sourcing policing, various types of audits are needed to ensure that organizations remain committed to achieving their sustainability goals ( Thompson et al 2013). Organizations should start by conducting a risk impact assessment with the goal of identifying suppliers associated with the highest risk. Suppliers with higher risks should undergo desk audits, assessing their policy and procedural frameworks, as well as the level of compliance with relevant laws and requirements (Schlegel 2016). An on-site audit must be conducted on all raw materials and finished products to ensure that high quality and environmentally friendly products are supplied. Employees are identified as the factors that determine the achievement of organizational objectives. An organization cannot achieve its business goals or objectives without the support and collaboration of employees. The implementation of the responsible policing process should involve favorable change management processes that are collaborative and participatory, as well as motivation strategies aimed at inspiring employee work engagement (Bessou et al, 2017). Quality change management offers training to employees regarding the new philosophies, methods and procedures involved in apolitics, which eliminates resistance to change. Motivational strategies, on the other hand, inspire positive work behaviors and attitudes that make employees engaged in their work. Engaged employees care more about their productivity as it is seen as part of their identity and will therefore strive to be productive. The success of implementing a plan is strongly determined by employee perceptions and attitudes toward the policy. Since implementation cannot be done without employee collaboration, promoting a healthy work environment should be a priority to ensure successful policy implementation. Additionally, leaders should promote a supportive organizational culture that emphasizes the need for ethics, professionalism, and diversity (Schlegel 2016). Organizational culture provides a favorable environment for policies to work and can therefore form a favorable basis for the implementation of responsible sourcing policy. TheOrganizations must maintain good relationships with suppliers and contribute to supplier development. As an approach to ensuring adequate implementation and monitoring, contracting organizations should provide recommendations for improvement and even participate in collaborative training and employee development to promote a culture of cooperation (Bessou et al, 2017). Procuring organizations can also share technological resources and directly fund research and development projects aimed at improving suppliers' sustainability practices. The supplier must also be given the opportunity to reform and correct its policies before receiving any sanctions. If an audit reveals a failure to comply with agreed terms, the supplier must be willing to develop an immediate corrective action plan aimed at correcting the situation, failure to comply with which the supplier will be charged for breach of contract (Thompson et al, 2013) . Management should devise strategic tools aimed at measuring the actual performance of policy objectives against expected outcomes. Continuous monitoring of performance indicators can help identify weaknesses and opportunities in the supply chain, enabling proactive risk management and capitalization of opportunities (Hidayat, Offermans, and Glasbergen 2018, p232). Performance evaluation tools include sustainability scorecards designed to evaluate a company's environmental performance in various operational areas. Please note: this is just an example. Get a custom paper from our expert writers now. Get a Custom Essay Conclusion and Recommendations Palm oil is a valuable commodity from which the global economy as it contributes to the production of a variety of consumer goods, supports economies and provides employment. However, palm oil production contributes significantly to the destruction of forests, the loss of biodiversity, the loss of indigenous communities and the encouragement of poor labor practices. As organizations move towards more sustainable models, adopting responsible policy to facilitate sustainable development is very important. Responsible sourcing policy will provide organizations with a rationale to follow when making supplier decisions, which in turn will help shape suppliers' manufacturing practices. To limit the negative effects of palm oil production, all brands using palm oil are advised to take responsibility for developing their own policies to ensure they support sustainable supply chains. The goal should be to avoid all companies that use forest land to grow and produce palm oil and only work with those companies that do not destroy forest land. Organizations can also create palm oil sustainability campaigns as part of implementing their policies, to help encourage ethical consumerism and environmental awareness. References Bai, B., Wang, L., Lee, M., Zhang, Y., Alfiko, Y., Ye, B.Q., Wan, Z.Y., Lim, C.H., Suwanto, A., Chua, N.H., & Yue, G.H. , 2017. 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