Palm Oil Supply Chain Abuses Reported by Amnesty International: Steps to Mitigate Legal Risk

by Perkins Coie

Perkins Coie

Amnesty International recently released a report alleging that supply chains for production of palm oil—a common ingredient in many consumer products—are tainted by forced and child labor. In the nearly 150-page report titled “The Great Palm Oil Scandal: Labour Abuses Behind Big Brand Names,” Amnesty International accuses several major brand-name consumer goods companies of sourcing palm oil from suppliers that operate plantations where the alleged abuses took place. 

The report has already received substantial media attention, including articles published by Forbes, The Washington Post, Reuters and Yahoo News. Although the accuracy of the report’s assertions have not been tested, it nonetheless emphasizes the growing importance of proper diligence in supply chain management and compliance with associated legal obligations for a company’s disclosures about its supply chain practices.

Mitigating Risks  

We recommend several steps to mitigate legal risk in these areas, including risk associated with follow-on litigation that has occurred after similar reporting about supply chain issues for other commodities. Specifically, we recommend that our clients take the following actions:

1. Review product lines for use of palm oil or other palm products, and assess practices and controls in related supply chains.

Palm oil is found in a wide range of consumer goods, including food products, cosmetics and detergents. Amnesty International estimates that approximately 50% of all packaged supermarket products contain palm oil. Amnesty International’s report and the corresponding increased media attention to palm oil supply chains make any manufacturer or retailer of products containing palm oil a potential target of consumer or government enforcement measures.

Companies should (1) review their product lines carefully to determine the prevalence of palm oil use; (2) assess existing controls and actual practices in their palm oil supply chains and (3) determine whether their palm oil is sourced from one of the suppliers specifically identified in Amnesty International’s report. Regardless of the actual merits of Amnesty International’s allegations about palm oil suppliers’ labor practices, any company that sources significant quantities of palm oil can mitigate their risk of government enforcement or private litigation by following these steps.

2. Review public supply chain disclosures for consistency with actual practices.

While Amnesty International’s report may serve as a fact-based catalyst for consumer and government enforcement measures, the legal hook will likely be laws requiring qualifying companies to publicly disclose the nature and scope of their efforts to eradicate forced labor from their worldwide supply chains. The most prominent of these are the California Transparency in Supply Chains Act (S.B. 657) and the United Kingdom’s Modern Slavery Act 2015. We recently published a review of these laws in an article titled “Don’t Let Forced Labor and Bribery in Your Supply Chain Spoil the Holidays.”

These disclosure laws are broadly applicable. The California Act, for instance, applies to all companies that have annual worldwide gross receipts in excess of $100M and “do business” (broadly defined) in California. If your company is a potential target of enforcement measures aimed at palm oil supply chains, it is essential that you review your company’s public supply chain disclosures for consistency with actual practices. Among the mistakes most commonly made by companies making supply chain disclosures is overstating the company’s actual efforts (as distinct from their aspirations). Exaggerations (e.g., “our supply chain is 100% free of forced labor”) and inconsistencies between disclosures and actual practices should be identified and avoided.

3. Adjust practices and disclosures as necessary.

If you determine there are inconsistencies or deficiencies in your company’s supply chain practices and/or disclosures, take measures now to cure the problems. Proactive, preventative action is relatively low-cost and will be invaluable from a human rights, reputational and litigation perspective. A swift and decisive response can make all the difference in the eyes of the public, a prosecutor or a jury.    

4. Conduct a broad review of supply chain practices, controls and disclosures. 

Amnesty International’s report merely adds to a growing chorus of clarion calls for consumer product retailers and manufacturers to take a closer look at their supply chain practices, controls and public disclosures. Put another way, companies are now clearly on notice. As consumer and government scrutiny and enforcement ramp up in this area, any company that does not keep pace through increased supply chain oversight risks becoming the next poster child.

[View source.]

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Perkins Coie | Attorney Advertising

Written by:

Perkins Coie

Perkins Coie on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at:

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.