Sustainable palm oil: how successful is RSPO certification?

The industry's certification body champions the multi-stakeholder approach, but it needs to move faster. Oliver Balch interviews the organisation's secretary general
Oliver Balch in Kuala Lumpur, Malaysia Guardian Professional 4 Jul 13;

In Kuala Lumpur, the haze is back. It's dry season, which puts this whole region of south-east Asia on alert for forest fires. This year, the outbreaks are more serious than usual. Blazing fires across central Sumatra in Indonesia have been coating neighbouring Singapore and Malaysia with a choking ash cloud for the last few weeks.

Darrel Webber is remarkably upbeat given the circumstances. As secretary general of the Roundtable on Sustainable Palm Oil, he presides over the world's flagship certification body for the palm oil industry. Many blame the fires – five of which are reportedly burning on roundtable-certified plantations – on slash-and-burn approaches to forest clearance.

That gives Webber some explaining to do. The energetic former environmentalist is quick to defend his member companies. Citing research from the World Resource Institute, he claims that about half (47%) of the fires are raging outside timber and palm oil plantations.

The roundtable has given the palm oil companies embroiled in the controversy 48 hours to respond with detailed maps of the affected areas. "If the fires are outside (the companies' plantations), then great; if they are inside, then we have to understand why it is happening."

If those firms turn out to be negligent, then they could face expulsion from the high-profile certification group, he warns.

Slow pace of change

This is tough talk. Set up nearly 10 years ago, the rondtable has become the poster boy for the multi-stakeholder approach to sustainability. Around the table sit environmental NGOs, social organisations and banks, as well as the various businesses involved in the palm oil trade: growers, processors, traders and retailers. It now counts just shy of 1,300 members, far outstripping similar roundtables on commodities such as soya, sugar, cotton, seafood and beef.

The downside of the multi-stakeholder model is the pace of change. Having to pass everything via consensus generally means setting the bar low to keep everyone on board. Webber says this inclusive response meets companies where they are at and pushes them towards "continuous improvement". Companies that gain certification for part of their operations, for example, must achieve compliance across the board within three years.

That said, only two companies have been thrown out of the roundtable to date for non-compliance. Even Webber can accept that things are moving slowly. Deforestation and other environmental damage caused by palm oil continues – although he'd argue that it's not primarily being driven byroundtable members. As well as the heartlands of Malaysia and Indonesia, new areas of tropical Africa and Latin America are opening up to the cash crop.

Uptake by consumers of certified palm oil is more sluggish than Webber would like, too. "Sustainable palm oil is still not a commodity; it's a niche. We only have 15% of the [total palm oil] market", he admits.

To make matters worse, nearly half (48.3%) of the 8.59m tonnes of certified palm oil produced over the last 12 months has failed to find a buyer. Instead, it was sold as conventional palm oil without a price premium. That hardly inspires producers to certify.

Laggard buyers

Amid this lacklustre picture, a few bright spots stand out. Countries such as The Netherlands, Belgium and the UK have all pledged to import 100% certified palm oil by 2015. Consumption rates in these countries run at around 30%-40%. The European Union is set to introduce compulsory labelling for all products that contain palm oil in late 2014, as well. Webber hopes this will raise consumer awareness of the issues related to palm oil production and increase pressure on the industry to certify.

While he accepts there is "headroom" for growth in Europe, his chief concern is winning uptake in huge consumer markets, such as the US, India and China. Certified palm oil has yet to make a dent on non-European consumers – something Webber hopes that would turn around were Europe to act as a "guiding light for other regions".

He blames global buyers for being lukewarm towards certification. Unlike consumers, the world's big purchasers of palm oil – food manufacturers, personal care brands, pharmaceuticals and so on – have full visibility of the supply chain.

"Companies have that power of analysis. They also have the scale to bring it [certified palm oil] to the market. I think it's those companies that need to work much harder", he states.

Difficulties in accessing available supply shouldn't detract them, he insists.

When roundtable growers cannot sell their produce on the premium market, they can issue virtual credits instead. Consumer goods companies and brands can then buy these so-called Green Palm certificates as a means of offsetting their purchase of non-sustainable palm oil. It's not perfect, but it's a step in the right direction, he says.

"There is nothing to stop companies offsetting their [unsustainable] purchases today with certificates. You can get certificates tomorrow if you want … Once the level [of certified supply] is high, then it'll be easy for you to get the physical supply. You can just pick up the phone," Webber explains.

Consumer pressure

As the market for sustainable palm oil struggles to find its feet, environmentalists and consumer groups are growing understandably frustrated. Webber is not deaf to the calls in some quarters to abandon the use of palm oil altogether, especially in foodstuffs and biofuel. That would be the "worst thing" consumers could do, he argues. Why?

Because palms require much less land to produce the same volume of oil as the best agricultural alternatives. Soya is about 10 times less productive per unit of cultivation, for instance, while rapeseed is around five times less.

"Saying no to palm oil means somewhere else you are going to have to produce one tonne more of another vegetable oil … So if you're saving one hectare of rainforest today from palm oil, you're removing four hectares of the Cerrado from Brazil tomorrow", he states.

Put that way, there doesn't seem to be much choice. Opt out of palm oil, and we'll either lose some of our favourite products or see yet more land given over to vegetable oil production. Stick with it, and we have to watch as sustainable certification schemes limp along.

Governments can certainly help to speed things up. In Indonesia, for example, lawmakers recently obliged all palm oil producers to meet a watered down version of the roundtable certification criteria. The fires there suggest such an approach has its limitations. Webber is the first to admit the fickleness of lawmakers.

"The only thing that is stopping further deforestation is legislation," he notes, in reference to measures such as moratoriums on felling and restrictions on new plantations. "And legislation can change."

The big push that the roundtable needs must ultimately come from consumers. A clear message from the tills will force buyers to act and thus oblige traders and producers to respond. But what will make consumers sit up and start shouting?

Strange as it may sound, an immediate answer might just be lurking in the smog outside Webber's office window in downtown Kuala Lumpur. "If you dig deeper, you'll find that RSPO plantations do come out much better," he maintains, referring to the supposed eradication of slash-and-burn techniques and better fire-risk management.

The results of RSPO's internal investigation will be out "within a fortnight". If Webber's claims prove right, it could well bolster his case for consumers to start demanding more certified palm oil. If he's wrong, well, we may need to find an alternative to the roundtable or to palm oil production, or both – and fast.