Ferrero, Chester Zoo & Hutan: Reshaping Palm Oil Procurement

Ferrero UK has joined Chester Zoo and conservation organisation Hutan on a three-year Biodiversity Research Forest programme in Borneo's Kinabatangan UNESCO Biosphere Reserve.

The collaboration could show how procurement teams can extend sustainability commitments beyond direct supplier relationships to influence wider landscape management.

The programme runs through to 2028 and focuses on monitoring species such as Bornean elephants and orangutans.

According to Ferrero, the data collected will be shared with palm oil plantation managers to inform how wildlife needs can be incorporated into operational planning. This represents a shift from transactional supplier compliance towards collaborative landscape stewardship models.

Monitoring methods inform supplier strategies

Hutan has deployed 30 camera traps, thermal drones and bioacoustic recorders across the Kinabatangan reserve. The organisation has worked in the region since 1998 and leads the research programme.

Scientists confirmed 15 key species within the reserve during the first year. Bornean orangutans and elephants were identified using a corridor that links two forest fragments.

These findings provide procurement teams with evidence-based metrics to evaluate supplier performance beyond certification standards alone.

Thermal drones provide direct identification of orangutans above the forest canopy. Camera traps and bioacoustic equipment monitor soil invertebrates, birds and frogs. The multi-layered monitoring approach creates a comprehensive biodiversity baseline that suppliers can use to measure the impact of management interventions over time.

"At Hutan, our mission is to ensure that people and nature can thrive together in balance," says Amanda Shia, Scientific Officer at Hutan.

"With the support from Ferrero, Chester Zoo and other partners, the monitoring we are doing is helping us see what we have never been able to see before, building a much more accurate picture of where wildlife are and how management plans can benefit them across this mosaic landscape."

Traceability systems support sourcing decisions

The biodiversity work connects to Ferrero's approach to palm oil procurement. The company sources 100% RSPO-certified palm oil and maintains traceability through what it calls a "sacco conosciuto" or "knowing what's in the bag" system.

According to Ferrero, this approach provides visibility over ingredients throughout the supply chain.

The company uses satellite technology to monitor its palm oil supply chain and works with a limited number of suppliers. This concentrated supplier base allows procurement teams to develop deeper relationships and implement more rigorous due diligence processes than would be possible with fragmented sourcing models.

Ferrero has been a member of the Roundtable on Sustainable Palm Oil since 2005. The company ranked second out of 285 companies in the 2024 WWF Palm Oil Buyers Scorecard. These external benchmarks provide procurement professionals with independent validation of sourcing strategies and help identify areas for continuous improvement.

"Ferrero's approach to sustainable palm oil has never been only about what we source," says Paola Nogales, Responsible Sourcing Manager at Ferrero.

"It is about the landscapes where palm oil is grown, the communities who depend on them and the wildlife they support."

Research findings shared with suppliers

Results from the Biodiversity Research Forest programme will be presented to local stakeholders including palm oil plantation managers. The data could inform how suppliers evaluate existing landscape management strategies such as wildlife corridors, orangutan bridges and buffer zones.

Procurement teams can use these research outputs to set clearer expectations with suppliers about biodiversity outcomes. The evidence base helps move conversations beyond compliance checklists towards measurable conservation impact. Suppliers gain access to scientific expertise that would be difficult to develop independently, strengthening the business case for responsible sourcing investments.

The Kinabatangan reserve contains what researchers describe as a mosaic landscape. Agricultural land sits alongside native forest areas. Understanding species movement across these boundaries helps procurement teams assess whether suppliers are managing their operations as isolated units or as part of functioning ecosystems.

Ferrero is also supporting TRAILS within the Kinabatangan reserve. This research programme is coordinated by CIRAD and delivered with Hutan and Melangking Oil Palm Plantations to investigate how palm oil plantations can incorporate native forest species.

"The Biodiversity Research Forest programme is the next step in our work together, generating research that can help inform how palm oil landscapes are managed, with the view to hopefully help drive wider landscape transformation beyond our own sourcing regions," says Paola.

"Long-term strategic partnerships with experts are what allow us to go beyond our own supply chain and help contribute to the wider industry."

Partnership model extends procurement scope

The collaboration between Ferrero and Chester Zoo covers multiple areas including conservation, education and consumer awareness. The biodiversity programme represents an extension into wildlife monitoring and applied research.

Ferrero manages the sourcing of cocoa, hazelnuts, dairy products and palm oil. According to the company, suppliers must adhere to ethical, environmental and social standards.

The multi-stakeholder partnership model demonstrates how procurement functions can leverage external expertise to enhance supplier engagement strategies and build industry-wide capacity for responsible sourcing.

Palm oil production can contribute to deforestation, biodiversity loss and social challenges when not managed responsibly.

Ferrero uses a deforestation-free and exploitation-free sourcing model. These commitments require robust supplier relationship management systems that can verify compliance and support continuous improvement across complex supply networks.

"Palm oil is often misunderstood, but when it is sourced sustainably, it can be a highly efficient crop with an important role to play," says Kirsten Pullen, Chief Conservation Officer and Deputy CEO at Chester Zoo. "The challenge is ensuring it is produced in a way that protects nature and supports communities."

Applied research supports landscape planning

The Kinabatangan Biosphere Reserve follows the Kinabatangan River, one of Malaysia's longest waterways. The reserve links with Borneo's mountains, headwaters and wetland areas and is classified as a Ramsar site of international importance.

Bornean elephants have been included as endangered species on the IUCN Red List. Monitoring these species provides indicators of ecosystem health. For procurement teams, this creates a framework for assessing supplier operations within critical conservation landscapes where sourcing decisions carry heightened environmental responsibility.

"Effective wildlife management in landscapes like the Kinabatangan depends on long-term collaboration between conservation organisations, researchers and industry," says Kirsten. "Our partnership with Ferrero UK reflects exactly that. Through the Biodiversity Research Forest, we are generating vital new insights into how wildlife is using these complex landscapes and how they can be better managed."

The data collected through the programme could inform how procurement teams assess supplier operations in complex landscapes where agriculture and conservation interests overlap. According to Chester Zoo, this type of field research is needed to improve conservation outcomes and support the transition to sustainable palm oil production at scale.

The research model provides a template for how procurement functions can contribute to landscape-level transformation whilst maintaining commercial sourcing objectives.