Mondelez International responds to the ethical dilemma of using palm oil by pointing to their Snacking Made Right report about their progress. They defined success as 100% RSPO palm oil by 2020, and they fully achieved that, according to the report. Their goal by 2025 is to maintain this percentage and also to expand their expectations to create more holistically ethical suppliers. Before I dive into that, I want to explain the term RSPO a bit better.
RSPO stands for Roundtable on Sustainable Palm Oil. This non-profit organization recognizes the social and environmental impacts of the palm oil industry, so it enables the gathering of all the stakeholder groups in the industry, including suppliers, investors, manufacturers, and NGOs. Together they created standards for suppliers to be considered Certified Sustainable based on key factors like fairness to workers and minimized environment destruction.
A recent Mondelez press release from September 3, 2020, highlights the “enhanced” 2025 goals for palm oil in more detail. Now that Mondelez only sources from suppliers with the RSPO “stamp of approval,” they aim to dig deeper into making sure those suppliers are sustainable sector-wide. For example, do they supply Mondelez with sustainable palm oil and other companies with non-sustainable palm oil? Mondelez wants transparency and traceability to ensure the whole supply chain of that company meets the sustainability requirements. The goal is for 80% of their suppliers to meet these enhanced criteria by 2025.
Another aspect of the enhanced goals includes satellite and third-party monitoring, especially against deforestation and forced labor. I find this helpful in making sure negative claims against a supplier are not going unnoticed. And at least satellite images form a source of hard data that can’t be argued against like words or reports. This inaccessibility to know what really goes on was one of the main concerns I had at the start of this case study, and it makes a difference that they will require continual monitoring. Otherwise, suppliers could break rules once they knew they had their certification in place.
In summary, I find Mondelez’s continuous improvement approach on this issue to be encouraging. When I first read the news article mentioned in post 1, I got the impression that Mondelez is actively involved in trying to cover up abuses in the palm oil industry. That is usually the case when we look deeper into ethical issues in the business world. On the contrary, they continue to enhance and raise their standards as time goes on, using their power and authority in the marketplace to set an example of ethical leadership.
Works Cited
@MDLZ. “In this environment, ESG is as important as ever.” Twitter, 28 July 2020, 5:13 p.m., https://twitter.com/MDLZ/status/1288221117384134657.
Mondelēz International. “Mondelēz International Advances Sustainable Palm Oil Sourcing with Enhanced Traceability.” Mondelēz International, 3 Sept. 2020, https://ir.mondelezinternational.com/news-releases/news-release-details/mondelez-international-advances-sustainable-palm-oil-sourcing.
Mondelēz International. “Snacking Made Right Report.” Mondelēz International, https://www.mondelezinternational.com/Snacking-Made-Right/Reporting-and-Disclosure.
Roundtable on Sustainable Palm Oil. “About.” RSPO, https://rspo.org/about.
The Longest Way Round 
From your research and discussions, the executive leadership has been taking great strides in the right direction among several ethical topics. I agree with you, Mondelez has made multiple improvements to their organization in different ways whether it was taking a corrective initiative or implementing sustainable practices within the work environment, they are progressing. Your graphics went hand in hand with your main points which was a great addition to your research.
You bring up a very crucial point, one of the largest impacts Mondelez is making is having transparency throughout their organization’s supply chain and operations. Having transparency throughout an organization indicates that they want their business practices, operations, and actions to be visible, and truthful to their organization, stakeholders, and the public. One of the ways you described in your post that they are expanding their company transparency is through the palm oil case. Mondelez now only works with suppliers that have the Roundtable on Sustainable Palm Oil certification, “stamp of approval”. Do you think Mondelez will make their goal by 2025 to have 80% of their suppliers with the RSPO certification? Also, do you think the suppliers will transition quickly to RSPO standards in time for Mondelez’s goal to happen?
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Thanks for posing this question about incorporating the enhanced criteria set by Mondelez by the year 2025. It is hard to tell with COVID-19 now throwing a wrench in the palm oil industry. I have read that demand for palm oil was affected, especially during the months of quarantine. I think they will be able to get to this goal by 2025, but as I talk about in post 4, the RSPO is not 100% reliable in punishing violations. So even if the suppliers are certified throughout their supply chain, who knows how reliable the certification will be in the future.
That is why transparency is also necessary to the flourishing of a company brand. If there is anything the company wants to hide, that is an indicator of something that needs to be corrected ethically-speaking. When I started out this project, I thought there would be more to uncover about Mondelez’s actions but it seems like they are doing everything they can to appear as a worthy and high-quality company to their customers, shareholders, and other stakeholders. That is, as far as we can see.
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Your research makes me very hopeful that Mondelez is moving in the right direction. The fact that they continually check in on the ethics of their suppliers, even after they receive a certification, makes me really see that the company wants to work in an ethical way throughout their entire supply chain. As you mentioned many companies try to hide and cover up their ethical issues, but it is clear that Mondelez is doing the opposite which is a really great change in the business world.
Their work towards transparency throughout the supply chain will hopefully spread throughout the entire business industry. Many consumers do not pay attention to where their products come from past the first company, so hopefully as more companies begin to talk about it, it will become more natural to look through the entire supply chain. However, it is hard to change human behavior and people may be willing to ignore something they cannot directly see. Do you think that even with Mondelez’s transparency, that other companies will still get away with unethical practices due to lack of consumer research? How do we as a society make that change? I think that it is an important change to make because if consumers do not hold companies accountable, they will never make the change.
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Thanks for posing those questions. I agree with the importance of consumer awareness and activism as the driver of change. But at the same time, I recognize this awareness is not feasible for all people (due to income or time factors), as one of our classmates brought up. And with the sheer number of products we buy, it is unrealistic to assume that we will research each one and each supply chain. So yes, other companies will get away with unethical practices; they will fail to use Mondelez as an example of ethical transparency. But the goal, as Mondelez mentions with their supply chain initiative, is for one company’s ethical actions to inspire others. It can be difficult to pioneer an ethical mode of business during a pandemic or even in the midst of daily demands. But then when one company steps forward, there is a model to draw from and improve upon.
I think that we should call out the worst of the ethical issues and encourage businesses to make self-motivated changes. For those mediocre companies who feel no moral obligation on their own, then the actions of their competitors can spur change. What I am trying to say is that consumer and competitor pressures can work together to achieve results.
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It is refreshing to head this company is actually following through on their word to change their actions and effects on the environment. I too agree if I had only read that first article, I would be a little more hesitant to accept their new and improved company plan, but upon seeing them actually enact these changes, I think they are headed in a better direction than most.
I think being this transparent in their inner workings is a new modern take on how a company operates. And it seems to be working great for them — as I, a potential consumer, am much more willing to give my money to them after seeing just exactly how they operate. I am curious to see if this philosophy they have will carry over into other companies as well. And alongside this will probably carry more drastic change in worker conditions as everything will be much more public than it is now. I’m curious how you see this playing out?
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Anytime a company takes a stand, its competitors take notice. The status quo has changed, and so forward-thinking companies might just follow suit. As a quick example, I looked up ConAgra Foods, one of Mondelez’ competitors. They have a decent emphasis on environmental sustainability, like with energy and waste reductions. I predict that over time they will feel pressure from the industry to further expand these (at the very least, they will not reduce their commitments). And good point about worker conditions. With satellite monitoring, new aspects may come to light. I think satellites only pick up on large-scale changes like deforestation, not person-to-person interactions. But this monitoring may still have the potential to bring public outrage and new labor laws if workers are not treated right.
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I agree with your impression from post 1, with Mondelez at first seeming to have more nefarious interactions with the palm oil industry, and other such sustainability efforts. However, going through this post, and seeing the actions they are taking in regards to the palm oil industry is more reassuring. I think it is a good stance for the company to be on the for front of the issue, and creating a plan to be achieved by 2025. I am glad they are going into satellite tracking to keep these companies accountable with hard evidence. One of the biggest ethical issues our generation has seen is the deforestation of the Amazon rain forest. The summer of 2019, when the Amazon remained on fire for over a month, saw a new precedent in preserving the rainforest and finding more ethical solutions to harvesting resources. As you stated, having the satellite tracking will ensure these companies continue to source ethically after they received the certification. Do you think there is any way companies will try to circumvent these satellite tracking measures? We have seen throughout these blog posts that many companies will exploit any loophole present for the sake of profit. Going back to Mondelez as a whole, I think it is good they want to track the whole manufacturing process and ensure sustainable and ethical actions are being taken.
This is a such a concerning topic and I am glad you’re shinning a light on it. Sustainable and ethical issues are often overshadowed by the sheer volume of human rights issues such as racism, sexism, and homophobia. Sustainable and ethical issues deserve the same level of concern, given the Earth is our home and our future; we should protect it. I am excited to see what other nuances you’ll bring to light in regards to these issues.
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Thanks for that information about the Amazon rainforest fires recently and the responses. I mostly know the science side of the issue of deforestation, like the loss of biodiversity and habitats for key species. So I appreciate your knowledge being added to this. Satellite imaging should help to slow deforestation; but unfortunately, it is an irreversible action. I wonder if they have sufficient monitoring staff to be able to stop deforestation efforts in the process. And yes, suppliers/plantation owners will probably try to circumvent the new regulations and find loopholes. Unethical decisions could be rationalized in light of the COVID-19 pandemic, like reasoning that prohibited actions are necessary to keep one’s business afloat. I’m sure this can happen during economic booms as well, but I just wanted to bring a current events standpoint in there.
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