ZSL demands greater transparency around supply chain issues
The Zoological society of London (ZSL) is demanding clarity around supply chains, as its concerns about competition and accountability obscure risks to tropical forests and threatened species grow.
The research data from ZSL’s latest SPOTT assessment claims that 79% of the natural rubber manufacturers assessed are yet to publicly claim traceability to rubber processor-level. ZSL claims just two companies; Michelin and Bridgestone, report they can trace some rubber back to the area where it was harvested.
ZSL Sustainable Business Specialist Sam Ginger, who led the assessment said: “Tyre manufacturers are the major players in the rubber supply chain, consuming over 70% of production. They often compete for access to the same rubber sources, and disclosing supplier locations could reveal competitive advantages, such as better pricing or more secure supply chains. However, this lack of transparency calls into question if enough is being done to protect nature.”
“The majority of rubber production occurs in Southeast Asia, home to species such as Endangered Asian elephants and Critically Endangered pangolins. Unsustainable practices threaten the future of these animals through habitat loss and increased human-wildlife conflict as animals stray onto plantations. Without supply chain traceability, companies cannot determine if they are supporting habitat destruction and biodiversity loss.”
ZSL claims pilot projects have shown that it is possible to trace rubber from processing facilities back to smallholder farms, enabling buyers to target interventions to improve farm sustainability.
Ginger added: “Buyers, investors, and organisations such as Global Platform for Sustainable Natural Rubber (GPSNR) are all calling for greater supply chain transparency in the natural rubber industry. Companies that are transparent about their supply chains can build trust with stakeholders, demonstrate their commitment to sustainability, and differentiate themselves from competitors. If they can also trace supply back to origin, claims of action on sustainability commitments can be corroborated.”
ZSL’s assessment also claims that rubber companies might not be ready for the implementation of the upcoming EU Deforestation Regulation (EUDR).
Under the EUDR, companies placing products on or exporting from the EU market must demonstrate that products are deforestation-free and legal, including rubber derivatives such as tyres, gloves, and apparel.
Joe Horrocks Taylor, environmental ESG analyst at Columbia Threadneedle Investments, which utilises the SPOTT assessment to rate rubber manufacturers, commented: “With agreement on the EUDR reached and natural rubber included in the final list of covered commodities, there is now an even stronger imperative for natural rubber manufacturers to disclose geo-location data for upstream production locations and to strengthen due diligence efforts.
“ZSL SPOTT’s Natural Rubber assessments are a crucial input which we use at Columbia Threadneedle Investments to be able to rate the quality of natural rubber manufacturers traceability, due diligence and environmental and social management. We engaged with seven natural rubber manufacturers and eight automotive companies in 2022, using ZSL SPOTT’s assessments and framework to focus on the most material issues. This is a programme which we will look to expand in 2023 by working with ZSL and our financial sector peers to accelerate the pace of change in the natural rubber industry.”
ZSL says it is firm on the need to create traceable and transparent natural rubber supply chains - part of their core mission to restore ecosystems and protect species. “Companies must publish lists of their suppliers - an action already commonplace for buyers of palm oil - and trace rubber to source so investments in sustainable cultivation practices can reach the farmers and environments in most need of assistance,” added Ginger.