Policies & Practices

Our annual citizenship report provides a comprehensive overview of our Citizenship efforts including significant data related to our Environmental, Social, and Governance (ESG) systems. We recognize that some stakeholders prefer to use third party ESG disclosure frameworks to review corporate ESG performance. To help facilitate that process, here is additional perspective on the following ESG disclosure frameworks:

Task Force on Climate Related Financial Disclosures (TCFD): Please click here to go to a November 2020 report that was informed by the TCFD guidelines.

Sustainable Accounting Standards Board (SASB): Please click here to go our 2020 SASB Matrix which addresses SASB’s key disclosure topics for our industry sector.

Global Reporting Initiative: This report references GRI 102: General Disclosures 2016. A GRI Content Index for this report can be found here.

P&G operates with tomorrow in mind. We enforce science-based practices with our employees, suppliers and partners because we’re committed to preserving our planet for generations to come.

At P&G, we are committed to doing our part to reduce greenhouse gas emissions that impact climate change. We are reducing our own carbon footprint and helping consumers do the same.

P&G Climate Change Position Statement

July 2019

As a global citizen, we are concerned about the negative consequences of climate change and believe governments, industry, and consumers all have a role to play in reducing greenhouse gas emissions to the atmosphere. We are committed to doing our part by focusing our efforts in the following areas:

1. Reducing the intensity of greenhouse gas emissions (GHG) from our own operations through:
   1. Driving energy efficiency measures throughout our facilities
   2. Transitioning energy sources toward lower/zero carbon alternatives
   3. Driving more energy-efficient modes of transporting finished products
2. We will help consumers to reduce their own GHG emissions through the use of our products via:
   1. Product and packaging innovations that enable more efficient consumer product use and energy consumption
   2. Consumer education to reduce GHG emissions such as the benefits of using cold water for machine washing
3. Work with partners across our value chain to ensure responsible sourcing of agricultural commodities that are known to be associated with deforestation risks (e.g. palm oil, wood pulp).
4. Work with our suppliers to identify meaningful opportunities to reduce our Scope 3 emissions

We will share progress on our overall climate change efforts, including reporting our Scope 1, 2, and 3 greenhouse gas emissions and progress against our goals, via our annual Citizenship Report.

Additional References

TCFD Reporting Guidelines: Please click here to access our TCFD Report.

Third Party Assurance of our GHG Inventory: Lloyd’s Register Quality Assurance (LRQA) provides independent verification of our GHG program to ensure it meets the intent of the World Resources Institute/World Business Council for Sustainable Development (WRI/WBCSD) GHG protocol.

We always look for ways to improve the environmental quality of our products, packaging and global operations.

Quality, safety and the environment

Our goal is to provide products and services that make a positive impact on our consumers. As a result, we strive to improve the environmental quality of our products, packaging and operations worldwide.

To carry out our Environmental Quality Policy, we pledge to:

• Ensure our products, packaging and operations are safe for our employees, consumers and the environment.
• Reduce or prevent the environmental impact of our products and packaging through their design, manufacture, distribution, use and disposal. We're passionate about innovative, practical solutions to environmental issues related to our business. We support the preservation of resources and actively encourage reuse, recycling and composting. We also partner and offer assistance to others who may contribute to progress in achieving environmental goals.
• Meet or exceed the requirements of all environmental laws and regulations. We use environmentally sound practices, even in the absence of governmental standards. We also cooperate with governments in analyzing environmental issues and developing cost-effective, scientifically based solutions and standards.
• Continually assess our environmental technology and programs, and monitor progress toward environmental goals. We develop and use state-of-the-art science and product life-cycle tests to assess environmental quality.
• Provide our consumers, customers, employees, communities, public interest groups and others with relevant and appropriate factual information about the environmental quality of P&G products, packaging and operations.
• Ensure every employee understands and is responsible for incorporating environmental quality considerations in their daily business activities. We encourage, recognize and reward individual and team leadership efforts to improve environmental quality—in and outside of work.
• Keep operating policies, programs and resources in place to implement our Environmental Quality Policy.

We embrace our role in ensuring the sustainability of forest resources through responsible procurement practices.

We use wood pulp for tissue and absorbent hygiene products. And while we don’t own or manage forests, we have a responsibility through our procurement practices to ensure sustainability of these resources.

We’re 100% committed to vetting the sources of our pulp fiber, being transparent in our sourcing and ensuring sustainable forest management. We also work to avoid any unwanted sources of wood and will collaborate with key stakeholders on increases in preferred certification schemes.

We take countless measures to ensure sustainable sourcing. Independent third-party verification systems are used to ensure sustainable forest management and wood traceability. And we partner with global multi-stakeholder organizations to develop tools and scientific methods to protect values and services that forests provide such as biodiversity, watershed protection and climate moderation. When it comes to transparency, we track and report the amount of wood pulp it purchases and relevant information on certification status.

Sustainable forest management

P&G requires that the forest certification systems utilized by our wood pulp suppliers adhere to the following criteria for sustainable forest management:

• Ensuring that unwanted wood sources are avoided and that wood is legally harvested and that all legal requirements are met. P&G will not knowingly use illegally sourced materials in our products.
• Ensuring the safety of forestry and manufacturing operations for employees and the environment.
• Ensuring that our supply chain is incorporating the principles of sustainable forest management and continuous improvement in their own operations and that these are verified by independent forest and chain-of custody certification.
• Ensuring that trees are not harvested from high-conservation-value forests. P&G supports multi-stakeholder efforts to develop information sources and tools that will help suppliers identify these areas on their own forestlands and in their procurement of wood raw materials from third parties (e.g., hcvnetwork.org).
• Ensuring that wood fiber obtained from converted forest lands where HCV are present have been protected.
• Ensuring that there is no sourcing from genetically modified trees.
• Ensuring that supplier practices reflect our social values and support of universal human rights through work with local governments and communities to improve the educational, cultural, economic and social well-being of those communities.
• Ensuring that our supply chain does not contain fiber from conflict timber (timber that was traded in a way that drives violent armed conflict or threatens national or regional stability).

At P&G, we are unequivocally committed to zero deforestation in our palm supply chain and are using our innovation strength to drive positive change in the industry.

Rooted in conviction

We are committed to no deforestation in our sourcing of palm oil, palm kernel oil and derivatives.

Goal Overview

P&G’s new goals call for ensuring no deforestation in its entire palm supply chain. Specific commitments include:

1. Establishing traceability of palm oil and palm kernel oil to supplier mills by December 31, 2015. ACHIEVED
2. Ensuring no deforestation in the palm supply chain to plantations by 2020;
   a. For palm oil, require suppliers to submit plans by December 31, 2015, that demonstrate how they will ensure no deforestation in the supply chain for their mills by 2020. COMPLETED
   b. For palm kernel oil, begin investing in and working with small farmers, with the aim of improving their practices to ensure no deforestation in the supply chain by 2020;
3. Working with suppliers, industry peers, NGOs, academic experts and other stakeholders to promote consistent industry standards and practices for sustainable palm oil sourcing.
4. Continuing to support universal human rights as outlined in P&G’s existing Sustainability Guidelines for Suppliers, and to support the rights of indigenous people.
5. Reporting annually on progress toward achieving these goals.

Details on our Palm Oil Policy

Palm oil is an important and versatile vegetable oil that is used as a raw material for both food and non-food industries. Palm is a highly productive crop, requiring much less land use than alternatives, and can contribute to economic development and poverty alleviation in regions where it is produced. These positive attributes have driven a significant increase in the global demand for palm oil and led to the rapid expansion of palm plantations. In some regions of the world, the rapid expansion of palm oil production has threatened environmentally sensitive areas of tropical forests and peatlands and has resulted in some incidents where the rights of workers and indigenous peoples have been infringed.

P&G uses relatively little palm oil, but we do use a by-product of palm oil production called palm kernel oil. Our combined use of palm oil, palm kernel oil and derivatives of each represents less than 1% of worldwide production. While our overall use is small, we recognise our responsibility to ensure our sourcing of palm-derived materials does not contribute to deforestation or infringe upon the rights of workers and indigenous peoples.

Our Commitment

P&G is committed to ensuring that our sourcing of palm oil, palm kernel oil and derivatives does not contribute to deforestation and respects the rights of workers and indigenous peoples.

P&G is a member of the Roundtable on Sustainable Palm Oil (RSPO), and we will continue to support RSPO standards as a key mechanism to drive responsible palm practices across the industry. Given the continued pressure on forests and peatlands, we recognise the need to take additional steps beyond RSPO to confirm the palm-derived materials we purchase are not contributing to deforestation. Therefore, to ensure no deforestation in our palm supply chain, we will:

• Develop a traceable supply chain
• Ensure our suppliers meet RSPO criteria and can ensure:
  • No development of High Conservation Value (HCV) areas and High Carbon Stock (HCS) forests
  • No new development of peat lands regardless of depth.
  • No burning to clear land for new development or replanting.
  • They meet expectations of P&G’s existing Sustainability Guidelines for Suppliers
  • Respect for human and labor rights
  • Respect land tenure rights, including rights of indigenous and local communities to give or withhold their free, prior and informed consent for development of land they own legally, communally or by custom
• Work with suppliers, industry peers, NGOs, academic experts and other stakeholders to promote consistent industry standards and practices in palm oil sourcing with the aim of achieving full traceability and eliminating deforestation.

Our Actions

To ensure we drive measurable progress against the commitments outlined above, we will take the following actions.

1. Palm oil and palm oil fractions. The following actions will apply to our purchases of palm oil and palm oil fractions:
   a. We have established traceability to palm oil mills by December 31, 2015.
   b. We have required suppliers to submit plans by December 31, 2015, to demonstrate how they will ensure no deforestation in their supply chain by 2020.
   c. As we advance progress against the goals above, we also will continue to purchase 100% RSPO certified palm oil.
2. Palm kernel oil. The following actions will apply to our purchase of palm kernel oil:
   a. We have established traceability to palm kernel oil mills by December 31, 2015.
   b. We will invest in and work with palm kernel oil suppliers, and the smallholders who supply them, with the aim of improving both practices and livelihoods to establish zero deforestation in our supply chain by 2020. We will work quickly over the next six months to define the details of this approach and will then communicate our plans.
3. Palm oil derivatives and palm kernel oil derivatives
   a. We will require suppliers to put forward time-bound plans by the end of 2016 to demonstrate how they will ensure no deforestation in their supply chains.
4. We will continue to work with the Consumer Goods Forum and other stakeholder groups to promote efforts for consistent industry standards and processes aimed to achieve traceability and eliminate deforestation.
5. We will report progress on each of these targets at least annually via our sustainability report.

Our Tier 1 palm suppliers are FGV, Wilmar, KLK, Musim Mas, GAR and AAA.

For the full list of our Palm Oil Sourcing Mills click here.

Click here for key drivers to land use.

Water is vital resource that must be preserved, conserved and shared to build healthy communities. We continue reducing our usage and are helping those who use our products to do the same.

At P&G, water is of crucial importance for both the production and use of our products. Thus, our approach to water aims at responsible use by both our Company and the consumers who use our products.

P&G respects the 2010 United Nations General Assembly resolution which recognizes the right to safe and clean drinking water and sanitation as a human right that is essential for the full enjoyment of life and all human rights. In all countries in which we operate, we will help ensure the sustainable use of water by abiding to the policy as outlined below:

1. Quality
The Company will continually improve our operations to preserve the quality of water in the communities in which we operate. The Company is also committed to a long-term, not-for-profit social and emergency relief effort to provide safe drinking water in the developing world aimed at reducing illness and death, particularly in children.

2. Availability
The Company is committed to sustainable water management by both our operations and consumer use of our products. This commitment includes water reduction goals, use of new technologies, product innovation using a lifecycle approach and siting decisions using a watershed approach.

3. Affordability
The Company understands that water use may affect affordability. Thus we are committed to water efficiency and sustainable use of water by our operations. We will also seek innovative ways to reduce water use by our consumers as well as educate them about the opportunity to save water. This will positively impact the cost of water to the Company, our consumers and the communities in which we operate.

4. Information
The Company will make available relevant and appropriate factual information about our water use. The Company is also committed to raising the awareness of water-related issues with our consumers, stakeholders and business partners with the aim of sustainable water use. We support external efforts to better understand key water-related issues with external partners, NGOs, associations and communities as well as support stewardship initiatives, standardization and measurements/reporting tools.

5. Legal Compliance
The Company will meet or exceed all applicable legislative and regulatory requirements with respect to water quality and consumption.

Click here to see how we manage water while making the products in your home.