Coconut – further efforts in responsible sourcing

AAK has been sourcing coconuts from India and Sri Lanka since the 1930s. Nowadays, Indonesia, the Philippines, and India are the three biggest coconut producers, accounting for 70 percent of global production. We source our coconut oil from the Philippines, Indonesia and partly from India.

Understanding our supply base

In 2018, AAK identified coconuts as a key raw material for responsible sourcing together with shea, palm oil, rapeseed and soy. For coconuts, the major risks in the supply chain still had to be identified and no industry-wide sustainability standard exists. Therefore, AAK teamed up with Proforest to conduct a risk assessment for our coconut supply chains.

The main priorities based on the risk assessment are listed below:

1. Improve traceability
2. Improve farmer livelihoods and keep them interested in growing coconuts
3. Rejuvenate the coconut industry

Engaging with suppliers and farmers

Based on priorities one and two, we have progressed on our supplier engagement in three different ways.

1. We have developed a supplier engagement workshop aimed at the mill, middlemen and farmer levels.
2. We have directly engaged with our tier 1 suppliers to help them improve the traceability in their supply chains. Key suppliers have been engaged and follow-up workstreams have been initiated.
3. We have completed the Rainforest Alliance Chain of Custody certification for our factory in Sweden, meaning AAK is fully ready to test if certification is the right tool to improve traceability and farmer income in our direct supply chain originating in Indonesia.

Driving impact beyond our supply base

Because approximately 90 percent of all coconut trees globally are reaching the end of their productive lifecycle, AAK has identified the rejuvenation of coconut tree populations as a priority. As a first step, we have engaged with a key supplier in the Philippines and have established a coconut nursery.

Additionally, AAK has been part of the initial industry meetings on sustainable coconut production. We plan to continue contributing to these discussions in the future.