Supplier Responsibility Principles
Our multifaceted supply chain includes suppliers of hogs, turkeys, ingredients, packaging materials and transportation. While it is a complex undertaking to understand and measure the impacts of the supply chain, we took a first step by developing Supplier Responsibility Principles in 2010.
We introduced these principles to our key suppliers in fiscal year 2011. We then shared them with all of our suppliers in 2015 to ensure everyone is operating in a sustainable and responsible manner. We continue to review and update these principles on an ongoing basis to ensure that top sustainability concerns are addressed and that they are ingrained in all levels of our business.
These principles define expectations for our suppliers in areas such as:
- Quality and product integrity;
- Safe work environment standards;
- Human rights;
- Animal care; and
- Environmental management.
We require all participants in our business, just like everyone within Hormel Foods, to consistently meet our standards and demonstrate their commitment to transparency and honesty through ethical business practices.
Through our supplier quality management program, we formally assess key suppliers in the areas of service, quality and sustainability. In addition, in calendar year 2014 our Procurement Council completed a category-level risk assessment process. Based on the results from this assessment process, we will work with the suppliers in the categories in which opportunities for improvement have been identified.
Supplier Diversity Program
We employ a supplier diversity program that gives diverse companies, such as women-owned and minority-owned businesses, the opportunity to supply quality product options that meet our company’s growing business needs. Working together, we provide the highest quality materials and services to our internal and external customers on a timely basis at the best economic value. Suppliers can submit their businesses for consideration at suppliers.hormelfoods.com.
Palm Oil Sourcing Policy
Palm Oil Principles
Hormel Foods recognizes the unique environmental and social risks associated with palm oil. These risks require additional due diligence in sourcing, education and training to ensure the palm oil in our supply chain is not associated with human rights issues, deforestation or plantation expansion on carbon-rich peatlands.
While Hormel Foods is a relatively minor user of palm oil, we realize that responsible sourcing of even the smallest amount of this ingredient can make a difference. Therefore, we will only purchase palm oil from suppliers who comply with the following sourcing principles:
- Legally acquire land rights and operations.
- Follow local laws and regulations.
- Respect the rights of all workers.
- Respect the free, prior and informed consent of local and indigenous communities.
- Resolve social conflicts and provide remedy and redress for past violations.
- Include smallholders in supply chains and ensure equitable benefit sharing.
- Protect high conservation value areas and high carbon stock forests.
- Protect rainforests and peatlands, regardless of depth.
- Reduce greenhouse gas emissions and institute a ban on burning.
- Follow the principles and criteria of the Roundtable on Sustainable Palm Oil (RSPO).
- Comply with the Hormel Foods Supplier Responsibility Principles, which outline our expectations for all suppliers to uphold top standards related to food quality, product integrity, human and labor standards, environmental practices, business ethics and animal care. In the event an audit or other credible source reveals a supplier is in violation of these principles, Hormel Foods will require the supplier to implement corrective actions. If reasonable/appropriate corrective actions cannot be agreed to, Hormel Foods will suspend or discontinue purchases from the supplier.
Palm Oil Action Plan
- We purchase RSPO-certified palm oil. We made an initial commitment that by the end of 2014, we would purchase only fully traceable palm oil. We met this commitment by working with our suppliers and achieved traceability to the mill level. In the spirit of continuous improvement, our updated commitment is that by 2020, we will purchase only sustainable palm oil that is fully traceable to the plantation level.
- In 2015, all of our suppliers published sourcing policies for their entire operations that meet our principles and implementation timelines.
- All of our suppliers are required to report the locations of plantations, mills and refineries from which they source. They must also report annually their progress in verifying the palm oil they source meets responsible production practices. All of this documentation is reviewed by the Hormel Foods Palm Oil Council.
- In addition, to ensure compliance with our sourcing principles, Hormel Foods will require suppliers to assess plantations in its supply chain (through internal and external assessment teams) and submit reports and findings annually, which will be reviewed by the Hormel Foods Palm Oil Council. If a supplier is in violation of our sourcing principles, Hormel Foods will require the supplier to implement corrective actions. If reasonable/appropriate corrective actions cannot be agreed to, Hormel Foods will suspend or discontinue purchases from the supplier.
We will communicate our progress toward this action plan in future corporate responsibility reports.
This policy applies to all products that contain palm oil that our company sells, in all countries where we operate.
Hormel Foods is a member of the Consumer Goods Forum, which has committed to mobilizing resources to achieve deforestation-free supply chains by 2020. This will be made possible by initiatives introduced by individual businesses and by companies working together as partners of governments and non-governmental organizations.
We invite you to learn more about our supply chain in the 2016 Hormel Foods Corporate Responsibility Report.
South American Beef Sourcing
Hormel Foods is committed to supporting a sustainable supply chain. We require suppliers to comply with all applicable laws and regulations, and our Supplier Responsibility Principles. These principles outline our expectations for food quality, product integrity, human rights and labor standards, environmental practices, business ethics, animal care and continuous improvement.
We source beef from suppliers who share these commitments and follow the principles and criteria of the Global Roundtable for Sustainable Beef (GRSB). The GRSB is a multi-stakeholder group whose mission is to advance continuous improvement in global beef value chain sustainability. The GRSB envisions a world in which all aspects of the beef value chain are environmentally sound, socially responsible and economically viable.
To ensure compliance with our requirements, our beef suppliers have monitoring systems in place for farms supplying cattle, which use satellite images and geo-referenced maps of farms, deforestation data and information from public agencies regarding embargoed areas and human rights. We also require and review independent audits of the environmental monitoring systems of our suppliers.
In addition, Hormel Foods is a member of the Consumer Goods Forum, which has committed to mobilizing resources to achieve deforestation free supply chains by 2020. This will be made possible by initiatives introduced by individual businesses and by companies working together as partners of governments and non-governmental organizations.
If a supplier is found to be in violation of our sourcing principles, Hormel Foods will require the supplier to implement corrective actions. If reasonable/appropriate corrective actions cannot be agreed to, Hormel Foods will suspend or discontinue purchases from the supplier.
For additional information about our corporate responsibility efforts, please visit the 2016 Hormel Foods Corporate Responsibility Report.