Mondelēz International: Oreos

overall Rating:

1.83

planets

Taylor Ford
3/11/2021
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I’ve been eating Oreos for as long as I can remember. Even to this day, Oreo ice-cream is one of my go-to desserts after a long day. Oreos may be a delicious snack for most people, but are they sustainable? Oreos are made by the US manufacturing company Nabisco, whose parent company is Mondelēz International. When looking at the investors page on the Mondelēz website, the first thing you see is “Sustainable Growth- An Introduction to Mondelēz International.” I think it’s interesting that sustainability seems to be so important for such a large company and that they are actively looking for sustainable investors. They claim that their “sustainability goals are an ambitious end-to-end approach to reduce [their] environmental footprint.” There is such a vast amount of information about what Mondelēz is doing for sustainability that I had a hard time sifting through all of it, but I would always rather see too much information than not enough. I’m impressed with Mondelēz for not only reaching certain goals but actually making an effort to go above and beyond. While I admire the work they are doing, at the end of the day, their main goal is to make as much money as possible, which isn’t necessarily a bad thing, but if they want to become truly sustainable, they are most definitely going to have to sacrifice a least some of their profits.

what it's made of:

2.5

Oreos, of course, are not known to be the healthiest snack in the world, but the same can be said about literally any cookie. Is it okay to indulge in a dessert a couple of times a week? Sure. Should you eat a pack of Oreos a day? Probably not, but that’s a personal choice. The ingredients I am most concerned about are cocoa, palm oil, and soy. These ingredients are notorious for mass deforestation and human rights violations, so I was interested to see how and if Mondelēz would address these important issues. Cocoa: The main problem with cocoa farming is the issue of child labor. Mondelēz created Cocoa Life in 2012 to build on the Cadbury Cocoa Partnership (founded in Ghana in 2008). The goal is to invest “$400 million USD by 2022 to empower at least 200,000 cocoa farmers and reach one million community members.” Cocoa Life helps them “gain knowledge and skills to improve their livelihoods, strengthen their communities and inspire the next generation of cocoa farmers.” I very much appreciate that Mondelēz created a whole website dedicated to this program, as it provides so much information about the steps they are taking to better the cocoa industry. They understand that child labor is the product of poverty and lack of rural development and this program is aimed at helping the root issue. The ultimate goal of this program is to ensure that all of their chocolate brands will source their cocoa through Cocoa Life by 2025. As of right now, 63% of their cocoa volume is sourced via Cocoa life, including Oreos, that already have the “Cocoa Life” logo on the product itself. Palm Oil: Mondelēz claims to be “committed to sourcing palm oil sustainably and eradicating deforestation and human rights violations in the palm oil supply.” In order to turn this claim into action, Mondelēz has maintained 100% Roundtable on Sustainable Palm Oil (RSPO) certifications since 2013 and now they are trying to push for more reforms. RSPO is a non-profit organization that has developed a set of environmental and social standards that companies must comply with to obtain the certification, however, RSPO is known to be quite vague about their requirements, so I am a bit skeptical about this certification. Mondelēz claims to be actively working with their global suppliers to ensure all the palm oil is sustainably sourced and fully traceable. They also say they are the first multi-national company to requires its suppliers to trace all the oil they sell, not just the oil that is sold to the company. In 2014, they established the Palm Oil Action Plan which is a long-term roadmap to achieve a sustainable palm oil supply. Mondelēz is working with the United Nation Development Program (UNDP), the government of Indonesia, and others to make sure they achieve this goal. By the end of 2019, 97% of the palm oil sourced by the company was traceable to the mill and 98% was purchased from suppliers with published policies that are aligned with best practice sustainable principles. They will require suppliers to confirm sustainable sourcing practices across their entire supply chain by 2025. There is so much information on their website about palm oil, so I’ll spare most of the nitty-gritty details and say that most of their requirements for their suppliers seem to be pretty specific, meaning there is virtually no way for the supplier to scoot around the rules. Overall, I’m very impressed that Mondelēz is going beyond basic compliance with RSPO standards and are using the resources they have to ensure the sustainable production of palm oil. Soy: Soy is where Mondelēz falls short. They do not provide a lot of information about their soy production, only the amount of carbon emissions it creates. Considering the heaps of information they have about cocoa and palm oil, I would expect to see much more information here.

how it's made:

2

Mondelēz International claims that their “belief is simple: it’s better to not generate waste to begin with.” I really admire this statement as they are acknowledging that offsetting the amount of waste they produce is not as effective at helping the planet as reducing the amount of waste in the first place. Most of their factories have already achieved zero waste to landfill, so now they are focusing their efforts beyond recycling waste to reducing total waste in their manufacturing. Most of this waste is food waste and their goal is to halve this waste within their operations by 2025. I also appreciate that Mondelēz lays out all of their company-wide initiatives for the year and if they achieved them or not. This year, they were able to reduce 15% of their carbon emissions across manufacturing operations, reduced water usage by 27% (specifically in priority areas where water is most scarce), reduced manufacturing waste by 21%, and signed a renewable energy partnership in the US with Enel Green Power, with enough energy to produce more than 50% of all Oreo cookies consumed in the US annually. This reduced 5% of their total manufacturing emissions. I admire that the company has set concrete goals that they are working to achieve and that they are very transparent about their numbers. However, they seem to only put their successes on their website, so I’m wondering if there are any goals they are working on that they haven’t achieved and didn’t advertise. I would also like to know what they are doing about Oreo’s packaging at it is single-use plastic. Recently, Mondelēz joined the Forest Positive Coalition of Action, a group of “seventeen global consumer goods brands, retailers and manufacturers [who] will work together to accelerate systemic efforts to remove deforestation, forest degradation and conversion from the key commodity supply chains.” As the Forest Positive Coalition of Action is relatively new, they have yet to create any concrete initiatives yet, so I can’t say much about it, but I’m interested to see what goals they will create in the future. I really admire that the company seems to be going above and beyond to acknowledge their role in climate change and are actively working to fix it. I would really like to see Mondelēz join other coalitions in the future to really push their company to be sustainable.

who makes it:

1

Mondelēz has several initiatives and programs in place in order to improve the lives of others. Along with improving the environmental and social sustainability of their supply chains, Mondelēz also states that their “financial means can be put to use in ways that create a positive impact in the communities in which we operate.” In order to turn this statement into action, the company partners with social entrepreneurs to support in the form of seed funding or growth capital rather than grants. They claim that this will better help to “incubate, nurture, and scale their ideas for a more sustainable and equitable future.” Along with these social ventures, Mondelēz also released how much money they gave in donations. According to their website, they donated 74.2 million dollars in 2019. While I admire that the company is taking action in order to give back to others, I would like to see exactly who they are donating to, and what percentage of their profits this amount of money is. While I do acknowledge the effort the company is putting in to give back to its communities, it is worth mentioning that they only seem to put the good things they do on their website, not the bad. Looking around different news sources about Mondelēz, I discovered that in 2014, they closed their American factories and moved production to Mexico. They made this decision as Bill Ackman, a hedge-fund billionaire, purchased a 7.5% stake in Mondelēz and allegedly pushed for cost-cutting measures. They did not move all of their production to Mexico, as they still produce Oreos in the US, but it did end up costing about 600 American jobs. This shows how the company values money over everything else, which obviously isn’t surprising for a multi-billion dollar company, but it definitely makes me think they are holding back a lot in terms of sustainability simply due to their desire to maintain a ridiculously high profit margin. Along with this, the current CEO, Dirk Van De Put, made 18 million USD in compensation in 2019, while the average salary of an employee is around 52,000 USD, making the CEO pay ratio around 346:1. This ratio is about the average for a lot of large companies, but that doesn’t make it any less shocking. I strongly believe that that ratio needs to decrease a lot and the company needs to pay their workers more. Overall, I am impressed with the work Mondelēz is doing to become more sustainable, but they still have a long way to go.

sources:

https://www.cocoalife.org/ https://rspo.org/ https://mondelezinternational.com/ https://www1.salary.com/Dirk-Van-de-Put-Salary-Bonus-Stock-Options-for-MONDELEZ-INTERNATIONAL-INC.html#:~:text=As%20Chairman%20and%20Chief%20Executive,made%20%2418%2C115%2C449%20in%20total%20compensation. https://en.wikipedia.org/wiki/Oreo_boycott https://www.theconsumergoodsforum.com/environmental-sustainability/forest-positive/