Banana Beef Cocoa Coconut Coffee Palm oil Soy Figure 1: Top origins of our high priority supply chains as per our deforestation risk assessment Sugar Timber & cane paper products By working closely with business partners and multi-stakeholder initiatives, we can find ways to maximise transparency in our supply chains to address data gaps and reduce operational risks. For some of the commodities that have the highest impact on deforestation, such as palm oil and soy, supply chains are especially complex, and a relatively small number of raw material traders have a much higher leverage than retailers or manufacturers. Regular assess - ments performed individually or collectively, will assist us in achieving transparency at trader level in the upcoming years. Standards are the basis Independent third-party certification schemes are key in allowing retailers to determine if sustainability requirements are implemented on the ground. This is especially important when local environmental protection legislation and/ or law enforcement in sourcing countries are insufficient to guarantee the protection of forests and natural ecosystems. To make sure we use certification schemes effectively, we apply the following principles: The membership in the Palm Oil Transparency Coalition (POTC) allows us to join forces with other retailers to assess traders and engage with them to drive improvements in their sustai - nability approaches. • We carefully assess the standards we accept as measures to reduce the risk of deforestation and conversion in our supply chains along several criteria, including credibility of a certifica - tion, the definition of cut-off dates, independent audits, and control mechanisms. Page 6
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