The ALDI SOUTH Group is one of Europe’s biggest retailers and one of the companies taking part in the 2019 WWF Palm Oil Buyers Scorecard. They are ‘leading the way’ towards a transition to sustainable palm oil. Understanding that sourcing 100% certified sustainable palm oil is not enough; ALDI engages in the Palm Oil Transparency Coalition to push for sector transformation and follows a broader agenda of working towards smallholder inclusive supply chains.
ALDI SOUTH Group – Palm Oil Frontrunner among Retailers
100% Certified Sustainable Palm Oil
The ALDI SOUTH Group has sourced 100% RSPO certified palm oil, palm kernel oil and palm oil derivatives for their own-brand food and non-food products since 2018. Their sourcing commitment applies to the entire Group on a global level.
Tackling the Challenges of Sustainable Palm Oil Derivatives
Roughly 25% of their total volume sourced are derivatives and fractions (D&F) and ALDI’s goal is to source them entirely from sustainable supply chains. According to Sarah Bollermann, CR Group Director from ALDI SOUTH Group, achieving 100% RSPO certified derivatives from physical supply chains was a challenge:
“The palm supply chain is complex and the availability of physically RSPO certified derivatives and fractions for non-food products was limited, until 2018. Thanks to sector wide collaboration that provided further information and guidance on derivatives and fractions in the industry, sustainably sourced derivatives have become more readily available.”
Close Cooperation with their Suppliers
To meet their global commitment, the ALDI SOUTH Group closely collaborates with their ingredient suppliers. They conducted surveys at the global level to obtain specific information about the availability of derivatives and fractions (D&F) from physical supply chains and the challenges linked to their procurement. In addition, they have set up an E-Learning module for their suppliers, containing general information on the palm supply chain, certification, reporting and, in particular, on D&F.
Working towards Smallholder Inclusive Supply Chains
Understanding that engagement must go beyond their own supply chain in order to guarantee sustainable sourcing of palm oil, the ALDI SOUTH Group developed a smallholder approach in 2016.
This entailed different strategies: Purchasing RSPO Independent Smallholder (I.S.) Credits and also encouraging their suppliers to engage with smallholders. As the retailer representative, they participate in the RSPO Smallholder Standing Committee to empower smallholder farmers and increase the availability of I.S. Credits on the market. Together with ALDI Nord and Solidaridad, they supported a smallholder project in Côte d’Ivoire that paves the way for the sustainable cultivation of palm oil whilst native forests are protected.
Sector Transformation through the Palm Oil Transparency Coalition
To contribute to market transition towards traceable, sustainable palm oil, the ALDI SOUTH Group engages with palm oil traders via the Palm Oil Transparency Coalition (POTC), a non-competitive coalition that consists of retailers and manufacturers. They are a co-founder of this coalition, which currently consists of 15 members. POTC aims to address human rights and deforestation challenges within the palm oil supply chain and asks palm oil traders to move towards sustainable palm oil. Annual POTC assessments evaluate the performance of the largest palm oil traders and publicly reveal gaps and recommendations, and POTC members subsequently take actions with their suppliers. NGO partners are involved in the review process and challenge POTC members to accelerate their own practices towards eliminating deforestation and exploitation.