We recognize that our business is inextricably linked to the continued availability of natural capital and are taking action to source natural resources in more sustainable ways. In particular, we consider palm oil together with paper and pulp to be our most critical natural resources. Palm oil is a key ingredient in surfactants, and paper and pulp are used in packaging materials, disposable diapers and numerous other products.
We support zero deforestation at source for sustainable procurement, and require all of our third-party suppliers and their corporate groups*1 in all forest risk commodities to adopt the NDPE*2 policies covering their all forest-risk commodities' supply chains as an obligation, work to confirm thorough compliance, and request them to respect the human rights of all those involved in the supply chain, respect the rights of workers and indigenous and local communities, and confirm free, prior, and informed consent (FPIC) of the communities. We have a zero-tolerance policy in place for our supply chains regarding violence, criminalization or intimidation of Human Rights Defenders (HRDs). We also take appropriate action against non-compliant suppliers in accordance with our corporate protocols, including the option of terminating business contracts.
We support NDPE policies to sustainably source palm oil and require that all of our third-party suppliers and their corporate groups involved in supplying our palm oil have adopted the NDPE policies covering their all forest-risk commodities' supply chains as an obligation and we are working to confirm their compliance with the policies as well as HCSA*3 thoroughly. We prioritize purchasing from suppliers who comply with NDPE policies and HCSA, do not use fire for land development and adhere to Free, Prior and Informed Consent (FPIC) processes. We ask non-compliant suppliers to take corrective action, verify that action has been taken and retain the option to terminate our business contracts with them.
We will expand our use of RSPO*4 -certified palm oil as we move toward 2025 and are planning to achieve full traceability down to the plantation level by working with palm suppliers as well as NGOs and NPOs.
We also recognize that independent oil palm smallholders in Indonesia (estimated at 2 million smallholders) have limited palm cultivation technology and low yields, placing them in a difficult position economically. We consider palm oil supply chains like these to be high-risk supply chains and, in 2020, began working with local partners*5 to provide direct assistance (in the form of training programs) to independent oil palm smallholders in Indonesia to tackle this problem at its root (SMILE Project*6 ).
By 2030, the project will have a scope of close to 5,000 estates and will provide technological instruction to increase productivity (with a target of doubling yields) and also educate smallholders to help them obtain RSPO certification (including RSPO Principles and Criteria, safety education and yield management methods). If all of Indonesia's independent oil palm smallholders were able to double their palm productivity, this would potentially curb new deforestation for an area of land equivalent to the current expanse of all the palm farms in Borneo (approximately 4 million hectares).
In 2022, we are implementing a grievance mechanism*7 for independent oil palm smallholders to rapidly resolve human rights issues. Under the grievance mechanism, we work with NPOs to investigate issues (grievances) at sites (oil palm smallholders), take action to resolve grievances and follow up afterward. In addition, we will start to disclose the Forest Footprint of our supply chains by 2023 as part of our deforestation monitoring.
Beginning with our dialogues with local oil palm smallholders, we are strengthening our activities in these areas to address key challenges in improving sustainability. We will also update external stakeholders such as NGOs, to further encourage improvements.
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