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Darden Palm Oil Policy 2013

Whereas:  The social and environmental impacts of palm oil production create important challenges for companies trying to ensure more sustainable and lower risk supply chain practices. Because our Company has not yet committed to procure certified sustainable palm oil for its products, we believe it opens itself to risks to its reputation as well as risks to the long-term security of its palm oil supply.
 
The largest suppliers of palm oil for the United States are Indonesia, Malaysia and Papua New Guinea.
 
In the Philippines, it is estimated that almost 25% of palm labor production comes from child labor (http://ctuhr.org/labor-groups-says-24-of-workers-in-oil-palm-plantations-are-children-calls-on-the-public-to-combat-child-labor/). The U.S. Department of Labor reported that child and/or forced labor contributed to palm oil production in Indonesia and Malaysia.  (http://www.dol.gov/ilab/programs/ocft/PDF/2010TVPRA.pdf). Many of these children are not part of family farms. Such labor practices may violate international codes of human rights.
 
According to the Union of Concerned Scientists, palm oil plantations “are a disproportionately large source of global warming emissions because they are often established on land converted from swamp forests. When these wetlands are drained, their carbon-rich peaty soils decay, releasing large amounts of both carbon dioxide and methane. Thus the expansion of plantations onto peat soils is an important source of the emissions that cause global warming.” (Ucsusa.org, June 2011).
 
Due in part to deforestation, Indonesia has been the 3rd largest emitter of greenhouse gases (GHGs) globally (World Bank).  The conversion of peatlands accounts for roughly half of Indonesia’s GHG emissions but only 1% of its gross domestic product (Mongabay, January 19, 2010). 
 
Palm oil plantations that are not sustainably managed have devastated habitats of endangered species, such as the orangutan. Failure to manage reputational risk connected to palm oil in supply chains has been disruptive for a number of major companies including Nestle, Mattel, and others who made palm oil contracts in Indonesia that resulted in negative publicity (http://en.wikipedia.org/wiki/Sinar_Mas_Group).
 
To address the social and environmental concerns associated with palm oil production and to promote sustainable palm oil products, the Roundtable on Sustainable Palm Oil was formed in 2004. Leading companies have committed to source only certified sustainable palm oil by 2016 or sooner, including: H.J. Heinz, SC Johnson, Wal-Mart, General Mills, McDonalds, Mars, Nestle, Starbucks and Unilever. Our company has not made such a commitment and has not adequately addressed the risks described above.
 
Resolved: Shareholders request the board of directors adopt and implement a comprehensive sustainable palm oil policy.
 
Supporting Statement: We believe such a policy should include: 1) a target date for sourcing 100% Certified Sustainable Palm Oil or for purchasing GreenPalm certificates covering 100% of sourced palm oil; 2) plans for independent verification of suppliers’ compliance with the policy; 3) support for a moratorium on palm oil expansion in rainforests and peatlands; and 4) a commitment to disclose publicly the company’s progress on this issue.