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Mondelez Sustainable Forestry 2014

Mondelez is one of the world’s largest consumer products companies, with a diversified line of brands including Oreo, Nabisco and Halls. Palm oil, soya, sugar and paper are used in a variety of Mondelez products.  Global demand for these commodities is fueling deforestation and human rights violations, including child and forced labor. 
Approximately a third of recorded large-scale land acquisitions globally since 2000 involve investment in cash crops such as sugar cane, palm oil, and soy. Many of these acquisitions involve evicting traditional land holders, through coercion or fraud ("land grabs").  
As a member of the Consumer Goods Forum, Mondelez recognizes that “Deforestation is one of the principal drivers of climate change, accounting for 17% of greenhouse gases today. The consumer goods industry, through its growing use of soya, palm oil, beef, paper and board, creates many of the economic incentives which drive deforestation.” (Consumer Goods Forum press release, 11/29/10). 
Climate change impacts from deforestation and poor forest management can be reduced through increased use of recycled materials, independent third party certification schemes, and monitoring of supply chains. 
Carbon Disclosure Project (CDP), an initiative backed by 184 financial institutions managing more than $13 trillion, calls on global corporations to report how their activities and supply chains contribute to deforestation and how those impacts are being managed.  Mondelez has declined to respond to CDP’s forestry survey.  
Mondelez discloses some information about its palm oil purchases. Nevertheless, Rainforest Action Network believes our Company’s products are “at high risk of contamination” with palm oil associated with human rights violations. Mondelez provides no information on the impact on forests and related human rights issues of its soya, paper and sugar purchases. Meaningful indicators would include:  
  • A company-wide policy on deforestation, with reference to key commodities driving deforestation, e.g., palm oil, soya, sugar, paper;
  • The percentage of each of these commodity purchases that Mondelez has traced back to its source;
  • The percentage of these commodity purchases that are sustainably sourced, with clear goals for each commodity;
  • Whether Mondelez and its suppliers have adopted a zero tolerance policy on “land grabs”;
  • Results of audits to ensure that suppliers are in compliance with Mondelez’s forestry goals;
  • Identification of certification systems and programs that the company uses to ensure sustainable sourcing of each of these commodities; and
  • An assessment of how Mondelez’s purchases impact deforestation and human rights, including rural communities’ land rights.
Proponent believes that Mondelez faces potential reputational and operational risks by failing to adequately disclose its approach to managing deforestation and related risks. For example, Cadbury, now a Mondelez brand, faced public controversy over use of palm oil in its Dairy Milk bars in New Zealand. 
RESOLVED:  Shareholders request the Board to prepare a public report, at reasonable cost and omitting proprietary information, by December 1, 2014, describing how Mondelez is assessing the company’s supply chain impact on deforestation, as well as associated human rights issues, and the company’s plans to mitigate these risks.