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Corruption scandal at palm oil company linked to environmental destruction and human rights abuses

BERKELEY, CA — The newest corruption scandal to rock the palm oil industry is unfolding in Guatemala as several executives with the Guatemalan palm oil company Reforestadora de Palmas AC (REPSA) face charges of corruption in a high-profile tax fraud investigation in Guatemala.

Following years of campaigning by Friends of the Earth and other groups in Guatemala and the U.S, Cargill and Wilmar International, two of the world’s largest agribusiness traders, suspended palm oil sourcing from REPSA last month. REPSA has been linked to a massive spill of palm oil effluent into Guatemala’s Pasion River in 2015, and to the killing of indigenous community leader Rigoberto Lima Choc following Lima Choc’s role in denouncing the spill. Another member of REPSA’s parent conglomerate, Grupo Hame, was fined $50 million USD for tax evasion in 2016.

Jeff Conant, Senior International Forests Program Director at Friends of the Earth, issued the following statement in response:

It is widely known that there are strong links between corporate corruption and environmental destruction, and the news out of REPSA is just the latest example. The company’s disastrous environmental record and its links to human rights abuses were known for years. Why did it take so long for Wilmar and Cargill, REPSA’s biggest customers, to stop buying REPSA’s conflict palm oil?

Many popular consumer brands, including Nestlé, continue to source palm oil from REPSA despite its criminal record, and against the express desires of the indigenous communities devastated by REPSA’s business. If the deadly 2015 ecocide did not motivate every company with ties to REPSA to cut those ties, maybe this corruption scandal will. We challenge Nestlé to take the first step, and cut its ties to REPSA once and for all.

Brands such as Colgate-Palmolive, Conagra Brands, Dunkin’ Brands, Grupo Bimbo, The Hershey Company, Kellogg Company, The Kraft Heinz Company, Krispy Kreme, Mars, Mondelēz, Nestlé, PepsiCo, Procter & Gamble and Unilever may be sourcing from REPSA or from suppliers that continue to do business with REPSA or Grupo Hame. Both Cargill and Wilmar International have been considering re-engagement with REPSA following their recent suspension of business.

To learn more, read our blog on this topic.

Expert Contact: Jeff Conant, (510) 900-0016, jconant@foe.org
Communications Contact: Erin Jensen, (202) 222-0722, ejensen@foe.org

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