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GreenToken: Unilever and SAP aim to tackle palm oil deforestation with blockchain pilot

Unilever moves to put palm oil on the blockchain with a new pilot project that improves the cost-effectiveness and transparency of its global supply chain.

The company announced this morning that it has partnered with German business software giant SAP to create a pilot of the GreenToken by SAP solution, which aims to digitally track palm oil through its supply chain.

The use of blockchain technology aims to limit the risk of raw materials such as palm oil with identical raw materials from verified and unverified sustainable sources after the ‘first mile’ of the supply chain, causing the original information to be either hidden or lost.

The companies said the pilot is following a successful proof of concept program in Indonesia, where Unilever applied GreenToken to obtain more than 188,000 tons of oil palm fruit.

The solution allows Golden Agri-Resources and other suppliers from which Unilever sources create tokens that reflect the material flow of palm oil through the supply chain and capture the unique attributes associated with the origin of the oil, SAP said.

“With GreenToken, we want to bring the same traceability and supply chain transparency to bulk raw materials that you get by scanning a bar or QR code on any consumer product,” said Nitin Jain, co-founder and CEO of GreenToken at SAP. “Our solution allows companies to tell what percentage of palm oil products they have purchased is from a sustainable origin and track it down to the end consumer product.”

Dave Ingram, Chief Purchasing Officer at Unilever, said the project will help the company achieve its goal of achieving a debilitating supply chain by 2023.

“Blockchain technology has the potential to help companies, like us, track their supply chains to ensure the commodities we source respect the people and the planet,” he said. “We are encouraged by the promising results of our pilot with SAP’s GreenToken, the latest building block for our tech-enabled approach to ensure a more traceable and transparent supply chain.”

Anita Neville, chief sustainability and communications officer at Golden Agri-Resources, similarly argued that the technology helped improve its offering to customers. “Technology has played an important role in our efforts to improve visibility and transparency in our own palm oil supply chains,” she said. “Our participation in the GreenToken pilot with SAP and Unilever has provided useful insights into how information is successfully passed between different actors in the supply chain.”

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