Sustainable Procurement Commitment to Eliminate Child Labor and Prevent Deforestation

We at Fuji Oil Holdings Inc. (President & CEO: Hiroshi Shimizu) would like to talk about the mid-to-long term goals we've drawn up in order to contribute to the realization of sustainable palm oil and cacao bean sourcing.

The Fuji Oil Group uses palm, cacao, and soybeans as raw materials for its business, which are environmental and social issues at the production site. We consider that switching all raw materials to sustainable ones is an essential strategy to enhance the sustainability of the Group's business.
For cacao and palm, we have already made the following efforts. In order to accelerate these activities, we will formulate a KPI and announce it internally and externally. This KPI will be reviewed in the next two years in line with changes in social conditions.

Mid-to-long term target		Current status 2025	2025	2030	Final Goal
Cacao	Child labor	CLMRS*1 97% Blommer direct supply	Zero WFCL*2	Zero Child labor	Eliminate child labor, eradicate deforestation
	Reforestation	130,000 trees current program tree planting	500,000 tree planting	1 million trees planted
Palm	Deforestation prevention	(TTP*3 52％)	TTP 75％	TTP 100％	NDPE*4
	Exploitation prevention	Improved working environment 10% (Major subsidiary)	Improved working environment 100％ (Major subsidiary)	Improved working environment (all direct supplier)

Plan	Current status
Soybean	Joined RTRS**5 May, 2020	Sourcing Policy and KPI by mid-2021

Our sustainable Cacao sourcing goal

While consumption of chocolate is increasing around the world, there are a number of societal issues in West Africa, the main producer of cacao beans. With the addition of Blommer, our group will accelerate our approach to solving social issues related to cocoa beans. We announced our 'Responsible Cacao Sourcing Policy' in August of 2018. We've established the following goals with this sourcing policy at their foundation.

New KPIs1. To completely eradicate child labor from our cacao bean and cacao product supply chain by 2030, we will eliminate what the International Labor Organization defines as the 'Worst Forms of Child Labor' by 2025.2. We will plant one million trees in cacao producing regions by 2030.
Background of issues and efforts to solve themIn Côte d'Ivoire and Ghana combined, the number of children working in cocoa agriculture is said to be around 2.1 million. Too often, many of these children are exposed to hazardous work and lack access to quality education. To eliminate this issue, our group, will launch a new program in Ghana, working on the cacao farmer's support such as child labor monitoring and improvement, women's empowerment, and reforestation, building on what Blommer has been working on in Côte d'Ivoire since 2007. In addition to our expanded programs, we have partnered with the Jacobs Foundation in their CLEF and ELAN programs pledging $1 million over five years. These programs based in Côte d'Ivoire will provide children with quality educational opportunities and improve their children's nutritional status.
As initiatives to aid in the preservation of biodiversity and to stem climate change, we have pledged to zero deforestation in both countries, and will actively focus on reforestation through the distribution of one million forest trees in cacao producing regions by 2030.

Our sustainable Palm oil sourcing goal

We announced our 'Responsible Palm Oil Sourcing Policy' in March of 2016.
To fundamentally resolve the societal issues facing the palm oil industry, we have established new goals in this sourcing policy.

Newly KPIs1. Traceability To Plantation (TTP) will be 100% by 2030. (52% at present)2. Labor Transformation Program (LTP) will be applied to suppliers with regard to our subsidiary Palmaju Edible Oil (Malaysia) and will be 100% by 2025.

To make progress with the prevention of random deforestation and human rights issues, it is necessary to work with local governments and NGOs to open a dialogue with area oil plants and plantations, so we can ensure that we are all on the same page when it comes to the preservation of forests. To that end, we will implement the promotion of certified oils, grievance mechanisms, landscape initiatives, satellite monitoring and the LTP method to create initiatives that ensure palm oil plantations do not engage in deforestation. In our group, we are promoting a sourcing policy with no deforestation, no peatland, and no exploitation (NDPE).

Regarding Soybean sourcing

Soybeans are a plant that can be produced in a wide variety of climates, from cool and temperate to the tropics. However, there are issues that cause concern in soybean production areas, like deforestation due to the development of farm land and soil pollution due to the application of agricultural chemicals. We were involved with the platform, the Roundtable on Responsible Soy Association (Head office: Switzerland) in May 2020. We're aiming to use what we learned on sustainability to draw up a sourcing policy by mid-next year.

Recognizing the social issues of palm, cacao, and soybeans, which are the main raw materials of our business, and utilizing the position of being able to obtain upstream and downstream information in the midstream of the supply chain, the Group will improve the sustainability of the supply chain. We will accelerate and make efforts to promote sustainable production and consumption in the 'SDGs Goal 12'.
We believe that securing sustainability in procurement is essential even for soybean, which has received relatively new attention from society compared to palm and cacao, where problems have been pointed out for some time. We regret not being able to announce the progress at the same time, but we will carefully and proactively consider it and respond promptly.

*1:CLMRS: Child Labor Monitoring and Remediation System
*2:WFCL: Worst Forms of Child Labor
*3:TTP: TTP: Traceable to Plantation
*4:NDPE: No Deforestation, No Peatland and No Exploitation
*5:RTRS：Roundtable on Responsible Soy Association

About Child labor: Definition by ILO: What is meant by child labor?
https://www.ilo.org/moscow/areas-of-work/child-labour/WCMS_249004/lang--en/index.htm
Worst Forms of Child Labor (No.182, 1999)
For the purposes of this Convention, the term the worst forms of child labour comprises:
(a) all forms of slavery or practices similar to slavery, such as the sale and trafficking of children, debt bondage and serfdom and forced or compulsory labour, including forced or compulsory recruitment of children for use in armed conflict;
(b) the use, procuring or offering of a child for prostitution, for the production of pornography or for pornographic performances;
(c) the use, procuring or offering of a child for illicit activities, in particular for the production and trafficking of drugs as defined in the relevant international treaties;
(d) work which, by its nature or the circumstances in which it is carried out, is likely to harm the health, safety or morals of children.
https://www.ilo.org/wcmsp5/groups/public/---ed_norm/---declaration/documents/publication/wcms_decl_fs_46_en.pdf
About palm supply chain:
https://www.fujioilholdings.com/en/csr/sustainable/sustainable_01/

Joint statement with Company Blommer

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