Retail Reflections

The Great Iceland Palm Oil Scandal

The Great Iceland Palm Oil Scandal

You may well have seen the banned TV advertisement on Youtube, if not the cute (sometimes shocking) pictures of baby orangutans, taken from their mother, shot, killed.

This, the result of mass deforestation in places such as Indonesia and Malaysia in order to make way for the planting of palm oil trees. And for what? So that we in the western world may enjoy everything from pizza to shampoo that little bit better?

Earlier this year, Iceland MD and member of Greenpeace, Richard Walker, son of the founder Sir Malcolm Walker, highlighted their plight and the harmful impact of deforestation on the environment to dramatic effect, pledging that hence forth Iceland would eradicate palm oil from all its own label products.

Back in April when he announced this, it garnered many positive headlines for Walker and Iceland from the environmentalist lobby. All very laudable.

However, somewhat confusingly, people in South-East Asia, where the deforestation is taking place were not so happy. 

How come?? 

According to environmentalist Jonathon Porritt in a blog he wrote just after the announcement in April:

“On a global basis, clearing forest either for grazing livestock, or for growing the feed that livestock needs, is a far more serious problem than conversion of forest for oil palm – up to ten times more serious, according to some estimates”

More than that, the amount of palm oil which Iceland uses is estimated to represent just 0.001% of global production. 

But if that wasn’t enough, the Roundtable on Sustainable Palm (RSPO) the not for profit organisation which champions sustainable palm oil, fundamentally disagrees with Iceland’s stance on the issue citing several reasons why it is flawed.

But according to Walker: “I’m absolutely 100% behind the idea of genuinely sustainable palm oil, but at the moment there isn’t such a thing”. Why then doesn’t he engage with the RSPO? 

Their CEO Darrel Webber said in April:

“If Iceland want to guarantee that their oils and fats sourcing is not causing rainforest destruction, they should work with the rest of the supply chain to promote the use of sustainable standards”

We should let consumers know that palm trees produce 4 to 10 times more oil per hectare than any other oil crop. Therefore eliminating palm oil might lead to the use of more land with higher risks of deforestation

Darrel Webber, CEO Roundtable on Sustainable Palm Oil

And so to this week with the news that the Iceland Christmas TV advertisement, recycling a Greenpeace video highlighting the plight of the orangutans, has been banned on the grounds of being too political.

In reality, it should have been banned on the grounds of being downright misleading. A cynical attempt to garner favour with their customers, too easily taken in by the terrible images.

Iceland as a business has much to be respected for; since 1970, filling a niche on the High Street which to this day is clearly welcomed by their customers.

And being sensitive to the environment, having a strong sense of corporate social responsibility should be part of the DNA of every responsible retailer.

However, when that responsibility – using the perfectly legitimate eco-friendly agenda, something we would all sign up to, in order to deliberately mislead the consumer – it should ring serious alarm bells as to the culture of the organisation.

Perhaps it’s time for Sir Malcolm to once more take back control of his business.

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