Today Amnesty International has published a damning new report into the practices of major consumer goods multinationals. The human rights NGO unpicks the palm oil supply chain and finds evidence of forced labor, child employment and dangerous working conditions within the palm oil supply chain. Although the company primarily under investigation is Wilmar, the world’s largest palm oil producer, it is the brand names that this firm suppliers that faces the charity’s opprobrium. Colgate, Nestlé and Unilever all come under heavy criticism for allowing conditions to emerge in their supply chains that many would regard as shocking. Amnesty International interviewed 120 workers within Wilmar’s plantations, as well as digging deeper into their suppliers in Indonesia. "Corporate giants like Colgate, Nestlé and Unilever assure consumers that their products use 'sustainable palm oil', but our findings reveal that the palm oil is anything but," noted Meghna Abraham, Senior Investigator at Amnesty International. "Companies are turning a blind eye to exploitation of workers in their supply chain. Despite promising customers that there will be no exploitation in their palm oil supply chains, big brands continue to profit from appalling abuses." Palm oil is a highly versatile product that is estimated to be in half of all consumer products, ranging from toothpaste to shampoo. It is mostly produced in Indonesia, which services over half of global demand. The palm oil sector is rife with corporate social responsibility issues and is linked to deforestation, where its land-intensive farms denude the Indonesian jungle and deny rare species, such as orangutans, of habitation. It also is an area of alleged worker exploitation. The Amnesty International report describes a punishing work regime with demanding performance targets. Failure to meet objectives can yield financial deductions. Penalties are levied at the manager’s discretion. Many laborers, the reporters find, feel compelled to work 10-11 hour-long days, accumulating to exceed the legal maximum of 40-hours per week in Indonesia. Despite this grueling schedule many claim they are paid beneath the legal minimum wage. The report finds that, such are the pressures under which workers are placed, they enlist their spouses and children to toil unpaid to avoid penalties from the employer. The charity found children as young as eight in employment, many of whom dropped out of school to meet their quota. One worker was quoted as saying: ““I get the premi [bonus] from the loose fruit that’s why my kids help me. I wouldn’t be able to meet the target … otherwise. … The foreman sees my children helping me. The foreman says it is good that my child is helping me.” Indonesia bans child labor. Amnesty International also finds evidence of using paraquat, highly dangerous herbicide. The chemical is banned in the European Union and Wilmar itself has made commitments to phase out its use. The report finds that suppliers are still routinely making use of the chemical. The investigators found one instance of a worker that was splashed in the face by the chemical, leading to severe injuries. “I can’t see through the eye. I get headaches in part of my head, when I do, my eye feels really swollen. I still get a bit dizzy”. These allegations are obviously serious and, if true, highly damaging to the brands concerned. In a statement to Fairfax Media, Wilmar acknowledge the report’s findings, and urged many within the industry to help combat these issues. Unilever also welcomed the report, agreeing that more needs to be done in the sector. Nestle also expressed concern and vowed to challenge Wilmar with the presented evidence. Colgate-Palmolive stated that they “prohibit discrimination and child or forced labor”. The companies concerned are signatories to the Roundtable on Sustainable Palm Oil, a declared commitment to use sustainable sources of the commodity. Despite this, and their own independent policies, these major organizations have failed to spot abuses within their own supply chains. Time and again, we can see that campaigning bodies, or even journalists, out-perform auditors in uncovering abuse in supply chains. There are some advantages that the smaller bodies possess: they are nimble, more focused and, even though they are significantly smaller than their target, can commit more resources to the investigation. Large multinationals, who commonly manage over 100,000 suppliers, are overwhelmed by the scale of their own supply chains. Third-parties can hone in on one supplier and subject it to a level of scrutiny the corporation could never match. This is the essential weakness of large companies. As multinationals' supply chains have bloated to ungovernable levels, they will be continually vulnerable accusations of abuse invisible to the corporation. Unless they commit the resources to match the NGOs and journalists, big companies will be easy prey for some time to come.
Colgate, Nestle, Unilever and Wilmar are among the companies that have been slammed over working conditions in their supply chains in a damning report by Amnesty International on the practices of major multinationals, with the palm oil supply chain being particularly criticised. The report found evidence of child employment, dangerous working conditions and forced labour in the industry. Palm oil is used in around half of all consumer products and is primarily produced in Indonesia, however, it is also rife with corporate social responsibility issues.