Palm Oil

Our Approach to Responsibly Sourced Palm Oil

Responsibly produced palm oil can reduce pressure on forests and biodiversity, support smallholder farmer livelihoods, and improve economic development in palm-growing regions. However, Hershey recognizes that palm oil can also have negative impacts on forests, biodiversity and producer communities when not grown or sourced responsibly.

Hershey is committed to the highest standards in responsible and sustainable palm oil sourcing, including our commitment to No Deforestation, No Peat Development and No Exploitation (NDPE) stated in our Responsible Palm Oil Sourcing Policy. Hershey maintains our commitment to source 100% of our palm oil volumes as physically certified through the Roundtable on Sustainable Palm Oil (RSPO) and to maintain 100% traceability to the mill. We continue to strengthen traceability to plantation where it is most material to environmental and human rights risk, using traceability as a tool to inform due diligence in higher‑risk parts of our supply chain. We are committed to achieving a deforestation- and conversion-free (DCF) supply chain for in-scope palm oil by December 31, 2030, while respecting and protecting the human rights of individuals as outlined in our DCF Policy.

We work with Earthworm Foundation, our supply chain partners, and the broader industry to help assess and address the associated environmental and human rights risks in our supply chain, including through monitoring, grievance response, and collective landscape initiatives that support transformation on the ground.

Our Palm Oil Supply Chain

We source palm oil through a network of direct suppliers and work with them to strengthen transparency, monitoring and responsible sourcing practices. In the first half of 2025, we sourced from eight direct suppliers: AAK, Alianza/Team Foods, Bunge, Cargill, Fuji Oil, Intercontinental Specialty Fats, Manorama and Wilmar.

The palm volumes from H1-2025 have originated from mills in nine countries—though most of the palm oil we source is from Indonesia and Malaysia.

As members of the RSPO, we annually report our palm oil volumes in our Annual Communication on Progress report. We also annually disclose how we comply with the RSPO Shared Responsibility requirements through our MyRSPO profile.

Through our partnership with Earthworm Foundation, we are focused on four strategic areas:

• Supply Chain Mapping: Mapping our palm oil sources at the mill and plantation level to understand high-risk sourcing areas in our palm supply chain and inform where in our palm supply chain we can make the biggest impact
• Supply Chain Monitoring and Response: Implementing satellite monitoring and response protocols as we work toward a DCF palm supply chain
• Origin Transformation: Investing in on-the-ground programs in our palm supply chain with a focus on protection and restoration of forests and biodiversity, smallholder inclusion, NDPE capacity building and resilience and livelihoods of local palm growing communities
• External Engagement: Engaging with suppliers and industry to communicate our expectations and strengthen NDPE policies, commitments and performance throughout the palm supply chain

Traceability and Risk Mitigation

Palm oil supply chains are complex and often involve multiple tiers of suppliers as well as intermediaries and smallholder suppliers. Supply chain mapping and purchasing certified palm oil enable us to prioritize our due diligence efforts in monitoring and verifying our palm suppliers’ compliance with our NDPE commitments.

Supply Chain Traceability

Twice per year, Hershey conducts a traceability exercise with our palm oil suppliers to understand the universe of potential mills and plantations from where the palm we source could have been produced. In this context, traceability is not a chain of custody concept and does not alone allow us to identify the specific source of palm oil used in a given Hershey product. Rather, the list of mills and plantations provided by our suppliers – collected in accordance with industry practice and principles adopted by the Palm Oil Traceability Working Group (TWG) of IDH, The Sustainable Trade Initiative – helps us understand the origin of the palm we purchase (including sources that may be considered high-risk), so that we may direct our resources to the locations where they are most needed.

In H1-2025, our direct suppliers reported 100% traceability to the mill (TTM) level – in other words, our direct suppliers could identify all of the mills from which they directly or indirectly purchased palm oil products during that six-month period, both for Hershey and other purchasers. The 796 mills in the lists provided by our suppliers therefore include mills outside Hershey’s physical supply chain.

In H1-2025, our direct suppliers reported 88% traceability to plantation (TTP) level. With Earthworm Foundation, we strengthened our traceability to plantation criteria to align with current industry guidance. We no longer accept a supplier-reported score and instead require GPS coordinates or polygon boundaries of plantations. For smallholders, we have moved to accepting the declaration of relevant jurisdictional areas where the smallholders are located as a minimum (e.g., village).

We remain committed to advancing traceability to the plantation level through our suppliers; that is, the identification of plantations from which the reported mills purchase. We recognize the pathway to this goal is complex due to the realities of the palm supply chain, including challenges associated with mapping smallholders.

Our partner, Earthworm Foundation, supports us in collating and analyzing the supply chain mapping submissions from our suppliers.

We provide bi-annual updates on these palm oil mapping efforts on this website and through our annual Responsible Business Report to give stakeholders visibility into our ongoing progress.

Certified Palm Oil

Hershey has been a member of the Roundtable on Sustainable Palm Oil (RSPO) since 2011. By the end of 2014, all of our palm and palm kernel oil directly purchased for our operations in the U.S. and Canada were RSPO Mass Balance certified. By the end of 2017, all of our direct palm and palm kernel oil purchases for Global operations were RSPO Mass Balance-certified palm oil. We remain committed to purchasing 100% RSPO Mass Balance and Segregated certified palm oil. As needed due to lack of RSPO certified palm or palm kernel oil volumes to meet our demand, Hershey purchases RSPO Credits to cover such gaps.

Furthermore, since 2020, Hershey has been a member of the North America Sustainable Palm Oil Network (NASPON), which works to accelerate the uptake of certified sustainable palm oil in North America.

Supply Chain Assessment and Monitoring

We expect all of our palm oil sourcing partners (including subcontractors) to be compliant with our Supplier Code of Conduct, uphold our Responsible Palm Oil Sourcing Policy and DCF Policy, and remain compliant to our NDPE position at the corporate-group level.

In addition, to assess that our palm suppliers uphold our standards within their own operations we have enrolled all Tier 1 palm suppliers and their manufacturing sites in our Responsible Sourcing Supplier Program.

As part of this program, all our palm suppliers and sites are required to complete a Self-Assessment Questionnaire, undergo a Sedex Members Ethical Trade Audit (SMETA) 4-pillar audit (or equivalent) and develop corrective action plans to remediate non-compliances.

Palm Oil Grievance Procedure and Log

As outlined in our Grievance Procedure, Hershey takes any reported grievances regarding deforestation, peatland development and exploitation in our palm oil supply chain seriously. If our direct suppliers and their parent and sister companies at the corporate-group level fail to uphold our commitments, they may be removed or suspended from our supply chain in accordance with our sourcing policy.

Listings of grievances and suspended palm companies are disclosed in our Palm Oil Grievance Log.

We bi-annually map our supply chain and monitor and ensure these suspensions are implemented. Suspensions remain in place until we see acceptable, timebound corrective action plans with proven progress that leads to a resolution. We also encourage our suppliers to remain engaged with these suspended parties to push for meaningful and decisive corrective action plans and the establishment of a timeline and progress report.

Engagement for Policy Implementation

Starting in 2019, Hershey began using Earthworm Foundation’s Engagement for Policy Implementation (EPI) tool with several of our direct suppliers. Our suppliers complete a self-assessment questionnaire focused on their palm sourcing and NDPE policies, commitments, traceability status, grievance procedure, social and environmental program investments and monitoring and verification activities.

Through EPI, Hershey gains deeper insights into our suppliers’ practices, activities, performance and opportunities for improvement to achieve a responsible palm oil supply chain. We use this data to structure how we engage with our suppliers to identify gaps related to their NDPE policies and commitments. Suppliers are supported to develop action plans to close these gaps.

Deforestation & Land Conversion Monitoring and Industry Collaboration

Since 2020, Hershey has worked with Starling, a satellite monitoring solution co-developed by Earthworm Foundation and Airbus, to monitor whether our palm oil supply chain is deforestation and conversion-free (DCF). 

We have made strong advancements, reporting 91% DCF based on monitoring of our H2-2024 and H1-2025 mill lists. We continue our efforts towards a DCF palm oil supply chain in line with our current DCF Policy and DCF Implementation Approach. 

Forest Footprint

In 2022, we engaged Earthworm Foundation to map our Forest Footprints for our palm supply chain in North Sumatra and Aceh, Indonesia, following the Rainforest Action Network’s methodology. This analysis has enabled us to identify areas of forest, peat and customary land at risk of palm expansion inside and outside concessions. These efforts resulted in Hershey’s funding of a Forest Conservation Fund project in North Sumatra, Indonesia described below. 

Origin Transformation

As part of Hershey’s commitment to restore and protect priority ecosystems and forests, we continue to invest in landscape collective actions and forest conservation projects in Indonesia and Malaysia. These on-the-ground programs focus on a range of priority areas including the protection and restoration of forests and biodiversity, smallholder inclusion, respect for human rights, NDPE capability building and the resilience and livelihoods of local palm-growing communities.

We financially support the following projects:

• Since 2017, Hershey has supported Earthworm Foundation’s Aceh Landscape, which is home to the biodiverse Leuser Ecosystem and the Rawa Singkil Wildlife Reserve. Based on 2025 reporting, through village‑led land‑use planning and local regulations, over 87,000 hectares of forest outside concessions were protected, alongside conservation actions within palm oil concessions, helping strengthen community‑based stewardship of standing forests.
• Since 2021, Hershey has supported Earthworm Foundation’s Southern Central Forest Spine (SCFS) landscape, a priority palm oil sourcing region in Malaysia, contributing to collective efforts to protect and manage remaining forest ecosystems. Through community‑led initiatives and multi-stakeholder collaboration, over 8,400 hectares were actively managed for forest protection and human-wildlife coexistence, and landscape‑level monitoring showed a 75% reduction in deforestation in 2025 compared to a 2020 baseline, reflecting progress toward safeguarding critical forest corridors.
• Since 2024, Hershey has supported Forest Conservation Fund’s Lobu Tayas Forest project in North Sumatra. The project supports local communities in establishing formal village forest management rights, enabling the protection of approximately 10,000 hectares of forest, while allowing sustainable livelihoods through non timber forest products and conservation-based land management.
• Starting in 2026, Hershey is also supporting the Forest Conservation Fund’s Lesan River Forest in East Kalimantan, Indonesia. Our co-funding is supporting joint forest patrols between the government and the community as well as planting fruit trees on the edges of the forest to secure the health of the local Orangutan population and safeguard the future of this biodiversity hotspot.