Unilever SAC 2010 Scheme Rules v4.9 1 March March 2019 v.4.9 SAC Page 1 of 18

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1 1 March 2019 v.4.9 SAC 2010 Page 1 of 18

2 BACKGROUND By 2020 Unilever intends to buy all its agricultural raw materials from farms applying sustainable agricultural practices, so that: Farmers and farm workers can obtain a liveable income and improve living conditions Soil fertility of agricultural land is maintained and improved Water availability and quality are protected and enhanced Nature, biodiversity and climate are protected and enhanced. This ambition has been the inspiration for the Unilever Sustainable Agriculture programme, which started in In 2010, this programme, in wide consultation with farmers, NGOs and academics, resulted in the publication of the Unilever Sustainable Agriculture Code. This, in turn, became the basis for the Unilever Sustainable Sourcing programme, one of the pillars of the Unilever Sustainable Living Plan, which was launched in November Note: This version of the SAC 2010 scheme rules is designed for suppliers who have not yet transitioned to the new system of certification against SAC 2017 and is therefore relevant only to those suppliers who are already using verified self-assessment. All suppliers will transition to the new system (or accepted equivalent) by PURPOSE OF THE SCHEME RULES In order for Unilever to be able to report on progress in Sustainable Sourcing, the following scheme rules have been developed to determine whether a certain volume of raw material A, purchased from supplier X, qualifies to be included in the Unilever Sustainable Sourcing Metric, i.e. whether this material will classify as having been sustainably sourced. RULES RELATING TO THE USE OF THE UNILEVER SUSTAINABLE AGRICULTURE CODE 2010 (SAC 2010) 1. General Conditions a) The scope and responsibilities as per sections 0.3 and 0.4 of SAC are adhered to Scope Unless otherwise stated in the text, the scope of this document is as below: Practices referring to Soils, soil management Crop husbandry Animal husbandry People, working conditions, health & safety, training Activities stretching beyond the farm, such as some aspects of Water or Value chain Scope Field on which Unilever crops are grown, including fields in rotation with other crops. Unilever crops Unilever animals. Animal slaughter and transport of animals off-farm is currently out of scope. Whole farm Whole farm 0.4 Responsibilities This Code of Conduct is applicable to all Unilever suppliers of agricultural goods, the farmers producing them and Page 2 of 18

3 b) The units that need to do the farm assessments are the primary processing plants from which Unilever (or Unilever suppliers) buy raw material. c) A random sample of farms for self-assessment will be taken for each new assessment round from the full list of farmers supplying that processing plant with raw materials that are supplied to Unilever. The selection will be made automatically through the Greenlight Assessments software system, or, if the software is not being used, by a Unilever representative, but not by the supplier themselves. Point 6. in this document describes what is meant by a random sample. d) The number of farms to be sampled per processing plant is determined by the following rules: i. If there are fewer than 30 farms, all the farmers are assessed. ii. When the number of farms is >30 the sampling rule is the square root of N (where N = the number of farms) or 30, whichever is the higher. This means that >30 farms must be sampled only if there are more than 900 farmers for the processing plant. iii. Suppliers may choose to sample >30 farms per processing plant, even if this is not required in ii. e) Where more than one processing plant, more than one crop, and/or more than one farmer group is involved, the sampling rules apply to every farmer group who fall under a separate management scheme or Internal Control System 2. For example: i ii Where one processing plant supplies more than one raw material to Unilever (e.g. different dried vegetables) the number of farms producing all the raw materials supplied to Unilever will be added together, and the total number used to determine how many farms need to be sampled, according to the rules under d). At least 2 farms must be sampled for each raw material. If a farm in the sample of 30 produces more than one raw material for Unilever, it may be asked to answer the metrics-related questions for each raw material separately. If a supplier has 3 plants in 3 locations (e.g. 1 plant per country), purchasing from different groups of farmers, each will be assessed separately. However, if different processing plants buy raw materials from the same group of farmers, or different groups of farmers under the same management system, the group need only be assessed once. f) When groups of farmers are located in different regions but are managed under the same management scheme or Internal Control System (i.e. are counted as one group for sampling purposes) documentary evidence of the common management system must be provided to Unilever. contractors working on farm. We hold our suppliers responsible for implementing this Code. However, many good practices must be applied by farmers, not suppliers. 2 A Management Scheme or Internal Control System is a documented and tested step-by-step method aimed at smooth functioning through standard practices. They generally include detailed information on topics such as (1) organising a programme, (2) setting and implementing corporate policies and targets, (3) establishing accounting, monitoring, and control procedures, (4) choosing and training employees, (5) evaluation procedures. Page 3 of 18

4 g) Assessments are carried out at the level of a particular raw material (farmer requirements) or product sold to Unilever (supplier requirements). h) The volume of material counted as sustainably sourced is the volume of product purchased by Unilever, or produced in a Unilever primary processing plant, not the volume of the harvested product. For example, soybean oil not soy beans, black leaf tea, not fresh leaf, tomato paste, not tomatoes. 2. Scoring system A farmer starts to count as compliant if their assessment (farmer and supplier questions combined) achieves: 100 % of Mandatory requirements 80 % of Applicable Musts in total 3 50 % of Applicable Musts per SAC Chapter The volume counted as sustainably sourced from a supplier is calculated as follows: a) If all farmers sampled and assessed (as defined in 1c.-e. above) are compliant then the total volume of product sold to Unilever is counted. b) If x/y farmers sampled are compliant then (x/y) * 100% of the total volume of product sold to Unilever can count. BUT all mandatory requirements must be achieved by all farmers sampled for any of the volume to count, i.e. if ANY of the sampled farmers fail ANY of the mandatory requirements, NONE of the volume of product sold to Unilever counts as sustainably sourced. Note: it is the number of farmers that is used in the calculation, regardless of the volume of material those farmers supply. This should be presented to Unilever as sustainably sourced (controlled mixing). c) If the conditions required for mass balance have been agreed with Unilever (see box Different Supply Chain Options ), the volume is calculated as (x/y)*100% (as in b), but the volume should be presented to Unilever as sustainably sourced (mass balance). The calculation as under a), b) and c) above will apply to the volume purchased by Unilever after all assessments for a supplier have been submitted and closed in the software system and compliance confirmed ( compliant date ). 3. Timing of Subsequent Assessments (Re-assessments) Re-assessment of a supplier must take place in accordance with the following rules: a) For compliant dates between 1 January and 30 June, all re-assessments must be submitted and closed before 30 June of the following year. b) For compliant dates between 1 July and 31 December, all re-assessments must be submitted and closed before 31 December of the following year. A new random sample will be used for each round of assessments. 3 This percentage is calculated by dividing the number of musts complied with by the total number of applicable musts in the assessment multiplied by 100. Page 4 of 18

5 4. Other Conditions a) Breaches of mandatory requirements that are listed under Prohibitions in SAC, must be stopped immediately on discovery as a condition for continuation as a supplier to Unilever. If a self-assessment is carried out and any mandatory requirement is failed, re-assessment can only take place during the next raw material production cycle. For seasonally-produced raw materials this will be the next season, for non-seasonal raw materials re-assessment can take place as soon as the mandatory failure has been corrected. b) An improvement plan with interim goals and timelines must be agreed with suppliers and the respective Unilever representative, with the aim of ensuring that at the time of the next assessment all farmers in the sample meet the entry compliance level. The improvement plan must be implemented with all farmers supplying the processing plant, not just a sample of farmers. c) An improvement plan with interim goals and timelines must be agreed with suppliers and the respective Unilever representative with the aim of ensuring that at least 80% of musts per SAC Chapter are achieved at all farms within 3 assessment periods. d) If suppliers fail to comply with the jointly agreed improvement plan (for all farmers to achieve 80 % musts per SAC Chapter within 3 assessment periods), supplier s volume loses its status as sustainably sourced. This means that over time progress should look as follows: Requirements Assessment 1 Assessment 2/3 Assessment 4 Mandatory All farmers, 100 % All farmers, 100 % All farmers, 100 % Musts on average X farmers, 80 % X farmers, 80 % All farmers, 80 % Musts per Chapter Table 1 - Improvement Requirements 5. Self-Assessment Verification X farmers, 50 % X farmers, >50 % All farmers, 80 % Unilever will commission an independent verification body to spot-audit a random sample of Unilever suppliers who use self-assessment, weighted by a sustainability risk assessment of the raw material origin. Based on a combination of sustainability risk indicators (e.g. risk of corruption, human rights abuses, child labour, illegal land clearing) countries are assigned a High Risk or Low Risk category. Sample size for verification in Low Risk countries is square root of the number of suppliers who have done a selfassessment, sample size in High Risk countries is twice that. Samples are random. For each supplier in the sample, three farmers are selected at random. The verification process checks whether the self-assessment, both at supplier and farmer level, were done correctly. If negative deviations are found, a pro-rata discount factor is calculated and applied to the total self-assessed volume for the year. 6. Random Sampling In random sampling each farmer included in the sample is chosen entirely by chance and each member of the farmer group has an equal chance of being included in the sample. Every possible sample of a given size has the same chance of selection; i.e. each member Page 5 of 18

6 of the farmer group is equally likely to be chosen at any stage in the sampling process. This reduces the chance of bias in the sample. The random sample of farms for self-assessment is an automated part of the assessment set creation process in the Greenlight Assessments self-assessment software. Prior to assessment set creation the full list of farmers supplying that processing plant with raw materials supplied to Unilever must be imported into Greenlight Assessments and the raw material assigned to each site. In exceptional circumstances, where Greenlight Assessments cannot be used to generate the random sample, suppliers must provide a database of their farmers, with numbers allocated to each farmer e.g Random numbers are then generated to select the sample. Random numbers can be generated using a calculator, spreadsheet or printed tables of random numbers. The generation of the random sample must be made by a Unilever representative, not by the supplier themselves. Page 6 of 18

7 ANNEX IA: EXTERNAL STANDARDS RECOGNISED BY UNILEVER AS FULLY COMPLIANT WITH THE PRINCIPLES OF SUSTAINABLE AGRICULTURE Please note: this Annex is only relevant to SAC 2010 and should only be used by suppliers who have not yet transitioned to the new system of certification against SAC 2017 (those suppliers who were already using verified self-assessment before the transition to SAC 2017 started). All other suppliers should refer to the SAC 2017 scheme rules for accepted certification schemes. ANNEX IA UPDATED 01/08/2017 Standard [Version #] Comments Applicable to Logos 1. SAN standard [Rainforest Alliance, July 2010] 2. SAN Cattle Standard [Rainforest Alliance, July RSPO [Principles and Criteria (2007)/ Certification Systems (2008)] 4. FSC Principles and Criteria for Forest Stewardship FSC-STD (Version 4-0) FSC Standard for Chain of Custody Certification FSC-STD (Version 1-1) 5. FLO [Version ] Sustainable Agriculture Network standard, basis for Rainforest Alliance certification Sustainable Agriculture Network standard, basis for Rainforest Alliance certification Roundtable for Sustainable Palm Oil. Either physical volumes of oil that are RSPO certified, or equivalent volumes of Greenpalm certificates, can be included. Forestry Stewardship Council Fair Trade Labelling Organisation Crops as per the SAN standard. Cattle (South America) Palm oil and all palm oilbased products, including fatty acid, fatty alcohol, fatty amine. Paper and board Crops as per the FLO standards. Page 7 of 18

8 6. MSC [Principles and Criteria (2002)/Chain of Custody (2005)] 7. IFOAM [Soil Association Revision 16.3, November 2010/National Programme for Organic Production, India, 2005] Marine Stewardship Council International Federation of Organic Agriculture Movements. Any organic standard recognised by IFOAM Any seafood from fisheries certified by MSC Any raw material 8. RTRS [Version 1.0, ] Roundtable for Responsible Soy Soybeans 9. Utz Certified [Version 2009/2010] Utz Certified Good Inside Coffee, Tea, Cocoa 10. Proterra (Version 2.0) Proterra standard developed by CERT ID All crops 11. Bonsucro Production Standard Including Bonsucro EU Production Standard (Version 3.0 March 2011) Accompanying documents: Bonsucro Certification Protocol Including Bonsucro EU Certification Protocol (2011) Bonsucro Audit Guidance for Production Standard Including EU Audit Guidance for the Production Standard (2011) Sugar (from sugarcane) Page 8 of 18

9 12. United States Department of Agriculture (USDA) National Organic Program (NOP) As seen at: AMSv1.0/ NOPNationalOrganic ProgramHome Associated regulations 7 CFR Section 205 established under Organic Foods Production Act of Any raw material 13. KDV 1 ( ; NL Pigs Landless) Keten Duurzaam Varkensvlees Pork (Netherlands) 14. ECOCERT ESR Standard Fairtrade scheme with any IFOAM approved organic standard. [Version 3 15/06/2013] 15. ISCC PLUS 202 V2.0 with & RSB Standard [RSB-STD (Version 1.0)] ECOCERT Groupe Suppliers are obliged to deliver on the relevant SAC metrics Roundtable on Sustainable Biomaterials Any organic food cosmetic, textile, detergent or home perfumes. Global for all Arable Commodity crops Global for all bio-products 17. Trustea Sustainability Code v2.0 Tea from India Page 9 of 18

10 18. VVAK+DAB V ASC Shrimp Standard Version 1.0 (March 2014) 20. Fair for Life (also known as For Life Fair Trade Certification Programme (December 2013) 21. SCS Sustainably Grown v2.1 (July 2016) The DAB is a voluntary add on to the VVAK standard meant as a licence to produce, but must be added for this Annex 1 status to apply. Aquaculture Stewardship Council Institute for Marketecology (IMO) SCS Global Services Arable and Industrial Vegetable Crops in The Netherlands (NL) and Belgium (BE) Global for all shrimp products produced by Aquaculture Global, any raw material Global, any food or fibre crop 22. SAI Platform Farm Sustainability Assessment (FSA) v2.0 Equivalent at Silver level All crops, globally 23. Utz Certified Hazelnut Module (v1.0 November 2015) Utz Certified Good Inside Hazelnuts globally 24. Vegaplan (2015) Benchmarked by SAI as FSA Gold-equivalent Arable crops and vegetables 25. Fieldprint Platform (FPP) plus supplemental questionnaire Memorandum of Understanding between FTM and FSA users must complete supplemental questions and score Silver to be equivalent. Commodity crops in the USA Page 10 of 18

11 ANNEX IB: INDUSTRY-LEVEL PROGRAMMES RECOGNISED BY UNILEVER AS FULLY COMPLIANT WITH THE PRINCIPLES OF SUSTAINABLE AGRICULTURE Please note: this Annex is only relevant to SAC 2010, and should only be used by suppliers who have not yet transitioned to using SAC 2017 (those suppliers who were already using industry level programmes before the transition to SAC 2017 started). All other suppliers should refer to the SAC 2017 scheme rules for accepted certification schemes. ANNEX IB updated 01/03/2016 Programme Comments Applicable to Logos 1. Dairy Australia Approach 2. Sustainable Dairy Assurance Scheme (SDAS) Rev 01 (December 2013) 3. US Soybean Sustainability Assurance Protocol + Field to Market Fieldprint Calculator Industry-level standard plus action plans Use conditional upon extra data provided by Bord Bia showing compliance with environmental requirements Farmers must complete the full Field to Market Fieldprint Calculator ), including the Habitat Protection Index module Dairy Products supplied by Australian suppliers Dairy Products from Eire (Republic of Ireland) Soybeans from Iowa, Illinois and Kansas, USA Page 11 of 18

12 ANNEX II - EXTERNAL STANDARDS RECOGNISED BY UNILEVER AS PARTIALLY COMPLIANT WITH THE PRINCIPLES OF SUSTAINABLE AGRICULTURE Please note: this Annex is only relevant to SAC 2010 and should only be used by suppliers who have not yet transitioned to the new system of certification against SAC 2017 (those suppliers who were already using verified self-assessment before the transition to SAC 2017 started). All other suppliers should refer to the SAC 2017 scheme rules for accepted certification schemes. ANNEX II UPDATED 12/07/2016 Standard Equivalence Areas not covered Applicable to Logo 1. PEFC (Programme for the Endorsement of Forest Certification) Equivalence is PEFC certification with full Chain of Custody in compliance with Noncontroversial Sources requirements (see Annex III) Additional requirements (see Annex III) Paper and Board 2. GLOBALG.A. P. Integrated Farm Assurance Standard (Crops Base) [Version 4.0, March 2011] and Fuels, Value Soils, Human Capital All crops 3. GLOBALG.A. P. Integrated Farm Assurance Standard (Livestock Base) [Version 4.0, March 2011] and Fuels, Animal Welfare, Value Soils, Human Capital Livestock 4. Food Alliance [Version ] Biodiversity Human Capital, Value Chain, Crops and livestock Page 12 of 18

13 5. LEAF Marque Global Standard [Version /10/13] Human Capital, Animal Welfare, Value Chain Crops and livestock 6. Red Tractor Combinable Crops and Sugar Beet Standards Version 2.0 (October 2011 Energy (Risk Assessment), Waste, Value Energy (efficiency), Human Capital Crops 7. Red Tractor Dairy Farm Standards Version 2.0 (October 2011) and Fuels, Waste, Value Chain, Animal Welfare Soils, Energy, Social and Human Capital Dairy Production 8. SQF (Safe Quality Food) 1000 Level 3 [Version January 2010] Animal Welfare, Value Chain, Human Capital Crops and livestock 9. QS (Guideline Agriculture) [Version: ] Animal Welfare, Value Chain Human Capital, Livestock Page 13 of 18

14 10. DANISH Product Standard [Version December 2010] Animal Welfare, Value Chain Human Capital, Pig production 11. RSPCA Freedom Food [RSPCA Welfare Standards for dairy cattle (January 2010), beef cattle (March 2010), chickens (February 2008), pigs (January 2010)] Animal Welfare Human Capital, Value Chain, Livestock (specific standards for individual products) 12. IKB Pork v 9.0 [January 2012] and Fuels 4, Water (quality), Waste, Human Capital, Animal Welfare, Value Soils, Water (irrigation management), Energy 4 IKB Pork is recognised by GlobalG.A.P. as equivalent to their standard (for details of benchmarking process see We have therefore assumed equivalence for the and Fuels chapter. Other chapters have been benchmarked according to our own procedures. Page 14 of 18

15 13. ISCC [V ] Social & Human Capital and Water (quality and irrigation management), Value Chain Oil seed rape within Germany (with additional requirements) 14. Sedex [Version ] SAC Criteria within Human Capital Animal Welfare, Value Chain, All raw materials 15. IKM v5.1/ Vegaplan (2014) Waste, Human Capital, Animal Welfare, Value Energy Dairy/Livestoc k and mixed farming including fodder 16. MgSzH (now NEBIH) + ISCC Plus 202 Waste, Energy, Social and Human Capital, Value Biodiversity Sunflower within Hungary Page 15 of 18

16 17. FairWild Standard v.2.0 : Biodiversity and Human Capital Waste, Energy, Value Wild Harvested crops 18. Agro 2.1 and 2.2 version 2 and Fuels, Value Soils, Human Capital All crops 19. Teh Lestari v1.0 & Fuels, Soils, Social & Human Capital, Value Chain and. Energy and Waste Tea from Indonesia 20. 2BSvs v1.7 (May 2011)/Conditi onalité French Oil Seed and Wheat Production & Fuels, Soils, Energy Social & Human Capital Waste, Value Chain and Oil seed crops, wheat, starches and sweeteners from France 21. CanadaGAP [Version ] Value Chain Human Capital, Canadian fresh fruits, vegetables and herbs Page 16 of 18

17 22. QS-GAP [Version 3.0, ] 5 and Fuels, Value Soils, Human Capital Fruit, Vegetables and Potatoes in Germany 23. Swiss-GAP Fruechte, Gemuese & Kartoffeln [Version published ] 6 and Fuels, Value Soils, Human Capital Fruit, Vegetables and Potatoes in Switzerland 24. Basis Quality Management Programme 2014 (BQM) 25. DTP112 CSQA Revision 2 (09/05/14) Energy, Value Soil, Energy, Human Capital, Value Chain and Waste, Social and Human Capital (Animal Welfare not applicable] and Fuels, Waste Grain crops in Saxony-Anhalt, Germany Grain crops and oilseed crops in Italy 5 QS-GAP is recognised by GlobalG.A.P. as equivalent to their standard (for details of benchmarking process see We therefore consider QS-GAP equivalent for the appropriate chapters, as shown. 6 Swiss-GAP Fruechte, Gemuese & Kartoffeln is recognised by GlobalG.A.P. as equivalent to their standard (for details of benchmarking process see We therefore consider Swiss-GAP equivalent for the appropriate chapters, as shown. Page 17 of 18

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