Researchers Slam Palm Oil Initiative as Industry Meets

Agence France-Presse Jakarta Globe 7 Nov 13;

Paris. Forests are still disappearing and local communities disregarded by palm oil development despite a plan to put the sector on a sustainable footing, researchers warned as an industry gathering kicked off Thursday.

After conducting 16 case studies in Africa and Southeast Asia, the hubs of the palm oil industry, researchers said in a new book they were disappointed with a joint industry-NGO initiative to reduce the sector’s impact.

The criticism came as the group behind the initiative, the Roundtable on Sustainable Palm Oil (RSPO), began its annual meeting in Indonesia.

“Since its founding 8 years ago, the RSPO has adopted good standards, but too many member companies are not delivering on these paper promises,” said Marcus Colchester, one of the authors of the book “Conflict or Consent? The oil palm sector at a crossroads”.

The RSPO was created in 2004 by members of the palm oil industry with the support of governments and non-governmental organizations such as the WWF to take a voluntary approach to limit the environmental and social impact of industrial farming.

Today it counts major producers of the popular cooking oil and processed food component as members.

The RSPO certifies operations that claim to respect the rights of indigenous peoples and adopt conservation policies.

The organization also aims to be a mediator for communities who have seen their way of life disrupted by palm plantations and the industry.

But as world demand for palm oil has boomed, it has touched off a land rush. Experts believe production will expand to Latin America in the next decade to meet growing demand.

In Indonesia alone, palm cultivation occupies 10.8 million hectares (26.3 million acres) — about the size of South Korea — and projects in the pipeline would occupy another 20 million hectares, or over 10 percent of the national territory.

Growing palm oil is a major source of conflicts, with the Indonesian government counting more than 4,000 disputes over land, according to Colchester.

It has also propelled Indonesia into third place globally for greenhouse gas emissions, following the United States and China, due to deforestation.

The 16 case studies included Indonesia and Malaysia, which between them account for 85 percent of global palm oil output. Also included were Philippines, Thailand, Cameroon, and the Democratic Republic of Congo.

In most cases the RSPO improved dialogue between local communities and producers, said the book’s authors.

Certain companies even adapted their practices to take concerns of local communities into account, they added.

“But RSPO-certified companies have not always held to their commitments, especially in respect to the rights of indigenous peoples and local communities,” according to the Forest Peoples Program, one the groups which conducted the case studies.

It pointed to a disconnect between company executives and managers.

“Senior company officials may have committed to the new approach but too often operational managers have failed to respond,” said the NGO.

Numerous companies also fail to follow guidelines and often local governments fail to protect communities, added Colchester.

He said they were disappointed with the slow progress and expressed concern some firms use RSPO certification as a marketing ploy.

Colchester also cited the case of the Singaporean giant Wilmar International, which processes 45 percent of the world’s palm oil, and is a RSPO member.

When residents of a community on the Indonesian island of Sumatra turned to the RSPO over a Wilmar project, he said the company sold the concession while mediation was under way, thus ridding itself of the problem it had created.

Agence France-Presse

Major palm oil companies accused of breaking ethical promises
Large plantations are destroying forests, damaging wildlife and causing social conflict in Asia and Africa, report finds
John Vidal theguardian.com 6 Nov 13;

Large palm oil companies that have promised to act ethically have been accused of land grabbing, ignoring human rights and exploiting labour in their African and Asian plantations.

In a damning 400-page investigation, the companies are variously charged with impacting on orangutan populations, destroying tropical forest and burning and draining large tracks of peat swamp forest.

Sixteen palm oil concessions, in Indonesia, Liberia, the Philippines, Malaysia, Democratic Republic of the Congo and Cameroon, all operated by members of the Roundtable on Sustainable Palm Oil (RSPO) were visited by monitors working with international human rights groups including UK-based Forest peoples programme and Sawit Watch, from Indonesia. Local communities consistently accused the companies of not respecting their customary land rights, violating laws and court rulings and acting in such a way that encouraged conflict.

The growing global demand for palm oil has fuelled a massive expansion of plantations across the forests of southeast Asia and Africa but concerns have been growing for over a decade about the resulting environmental and social impacts. The RSPO, set up in 2004 by the industry and civil society groups including WWF, sets criteria for greener palm oil production and tries to encourage industry expansion in ways that do not cause social conflict.

About 15% of the world's palm oil is now certified as "sustainable" by the RSPO, whose members range from some of the largest growers and traders, to relatively small companies.

"Since its founding the RSPO has adopted good standards, but too many member companies are not delivering on these paper promises," said Norman Jiwan, director of human rights group Transformasi Untuk Keadilan Indonesia.

The report will be published on Thursday in Sumatra, where over 10.8m hectares of land has been planted with oil palm trees, to coincide with the annual meeting of the RSPO in Medan, Indonesia.

It follows growing alarm at the way communities in Asia and Africa are being pushed aside to make way for large plantations and the loss of wildlife, including the tiger. Many organisations, including the World Bank, the UN's Food and Agriculture Organisation, Greenpeace and Walhi, have expressed deep concern at the resulting impoverishment of local commuities and the growth of confllict around the concessions.

According to some, the RSPO's voluntary "best practice" rules and guidelines are not working and the organisation is in danger of becoming a figleaf for agribusiness to take advantage of weak land laws.

"Underlying this failure of 'voluntary best practice' are national laws and policies which deny or ignore indigenous peoples' and communities' land rights," said Marcus Colchester, an adviser at Forest Peoples Programme.

"In their rush to encourage investment and exports, governments are trampling their own citizens' rights. Global investors, retailers, manufacturers and traders must insist on dealing in conflict-free palm oil, and national governments must up their game and respect communities' rights."

Concern in the report centres on the Indonesian legal system which is described as "unjust" because it allows land to be expropriated from local peoople without regard for internationally recognised rights. Land laws favour large-scale plantations and lead to the widespread abuse of human rights. The report found that palm oil expansion in the Malaysian state of Sarawak was systematically grabbing Dayak lands without their consent.

"So much effort has been invested in the RSPO ... but to little avail," said Jefri Saragih, executive director of Sawit Watch, a founding member of the RSPO. "We can point to one or two good results on the ground, but there are thousands of land conflicts with oil palm companies in Indonesia alone, and the problem is now spreading to other parts of Asia and Africa. We are calling for an urgent and vastly expanded response to this crisis."

The RSPO responded to the criticism in a statement. "Making the palm oil market fully sustainable is possible but only over time, and with the right levels of commitment. The RSPO depends on the goodwill of companies on the ground, and local government authorities, to ensure that these principles and criteria are abided to. There have been a number of cases of non-compliant members."

It further said that it has strengthened its commitment towards human rights, requring companies to implement policies to counter corruption, ban forced labour and forbid use of disputed lands. However, there is no legal compulsion on members to comply with RSPO's principles and criteria.

"Non-complying member organisations can simply opt to leave the RSPO in the midst of a complaint, and consequently they will not be governed by any of our rules. The RSPO closely monitors the activities of its members [but] it has no legal way to enforce its members to comply."

The RSPO engine for sustainable palm oil seems to be sputtering
Vincent Lingga, The Jakarta Post 11 Nov 13;

More than 600 delegates from 30 countries are gathering in the Roundtable on Sustainable Palm Oil (RSPO) 11th annual conference opening in Medan, North Sumatra, today when the multi-stakeholder organization itself is facing bigger challenges to its own sustainability as the market watchdog of socially and environmentally sustainable palm oil.

Even though most big palm oil companies in Malaysia and Indonesia, which together account for over 85 percent of global production, and most consumer product giants, such as Nestle, Unilever and major environmental NGOs remain RSPO members, its effectiveness as the vanguard of sustainable palm oil is increasingly under scrutiny.

The establishment of the RSPO in 2004 by plantation companies, processors, manufacturers of consumer products, retailers, banks and environmental conservation NGOs was prompted largely by market forces or the mounting consumer demand for green products.

However, more than five years after the RSPO began its certification program, the volume of RSPO certified palm oil remains very small, amounting to only 8.3 million tons or 15 percent of global output.

Yet even more disappointing, both the market uptake of certified palm oil and the premium price gained by this supposed ‘green’ commodity are also negligibly small.

In fact since several RSPO members were implicated in the June-July forest fires in Riau, which caused the worst haze that Malaysia and Singapore had ever faced. This organization has been criticized for what several NGOs see as weak enforcement of its principles of sustainability.

The Indonesian government countered the RSPO with its own program called the Indonesia Sustainable Palm Oil (ISPO) in 2011 and Malaysia is also reportedly preparing its own sustainability initiative called the MSPO.

Even though the credibility of both programs are questionable due to the non-involvement of NGOs and independent auditors, the ISPO certification has been made compulsory for all companies.

The principles of sustainable management promoted and assessed by the RSPO for its certification process includes elements, such as transparency, legal and regulatory compliance, best production practices, environmental responsibility, commitments to local community development, human rights as well as land rights to name a few.

By and large, these principles and criteria are precisely the best practices for agricultural development that the ISPO itself has been trying to promote.

The good news is that earlier this month, the RSPO and ISPO signed an agreement on strategic cooperation to eventually develop a unified certification program for sustainable palm oil.

At present, companies in Indonesia deal with two different certification programs: RSPO certification, which is voluntary but recognized by the consumers in the developed countries, and ISPO certification, which is mandatory but lacks international credibility due to the absence of environmental NGOs and independent auditors as well as weak law enforcement.

But it will probably take a long time before the RSPO and ISPO can finally develop a unified certification plan, which will be globally recognized, especially if the Indonesian government is not willing to involve environmental NGOs and other private-sector stakeholders, such as consumer products and retail giants.

But without government involvement in or co-ownership of its certification program, the RSPO would find it extremely difficult to influence policies in Indonesia and Malaysia.

In fact, the RSPO has been perceived in many quarters in both countries mainly as a forum of multinational buyers and international NGOs despite the active participation of smallholders.

Despite these differences, it is nevertheless totally misguided to say that the green campaign for agricultural commodities will weaken. On the contrary, the clock of the global green-consumer drive has been ticking faster and can no longer be turned back.

The force of the gren consumer drive has also been quite strong within the 21-member Asia Pacific Economic Cooperation, which held its annual summit in Bali last month.

APEC has drawn a list of 54 Environmental Goods that are eligigible for deep import tariff cuts as low as five percent.

Indonesia, as the host of the summit, lobbied hard to enter palm oil and rubber to the list, but failed miserably.

The rationale for the green campaign for agricultural commodities is this: because the prominent role of agriculture in the use of natural resources — notably land, water and biodiversity — ensuring sustainable resource use has become an important challenge.

The allegations that the RSPO movement is a subterfuge by the producers of vegetable oils, such as soybean, sunflower, rapeseed and corn oil in the rich countries in coping with the fierce competition from palm oil seem misplaced.

Independent product certification has earlier been used in the forestry industry as a market-based instrument to supplement the regulatory system in curbing illegal logging.

The Bonn-based Forest Stewardship Council (FSC), which groups the representatives from environmental and conservation groups, timber industry, forestry professions, forest certification organizations and forestry communities, has developed forest certification standards and accredits independent certifiers.

The Indonesian government has launched an official timber legality certification program, called SVLK, and has made this program compulsory for all forestry products under an agreement with the European Union.

The green consumer campaign for socially, environmentally and economically sustainable farm commodities has escalated around the world and covered other agricultural commodities, such as soybeans and sugar cane.

Soybean growers and processors in North and South America and Australia, grouped in the Roundtable on Responsible Soy Association (RTRS), and sugarcane growers and processors under their Bonsucro organization, have also begun similar certification programs.

Industrial users in Europe, which consume more than six million tons of palm oil a year, have committed to using only RSPO certified palm oil by 2015.

The Singapore-based International Rubber Study Group (IRSG) has embarked on an ambitious initiative to draw up a plan for the industry, much like what the RSPO has been doing in palm oil.

IRSG said recently all stakeholders of the rubber supply-chain system should come up with a sustainability plan, especially because over 85 percent of rubber production comes from small growers.

The campaign for sustainable agricultural commodities, especially palm oil, still has still a long way to go, especially because India and China, the world’s largest palm oil consumers, have yet to realize the urgency of this green consumer agenda.

But as the experiences of several the RSPO members who have certified their plantations have shown, the primary beneficiaries of sustainable oil palm development are the growers themselves.

Several RSPO certified palm oil companies have showcased that their best agricultural and corporate governance practices immediately generated benefits like higher efficiency, higher productivity, peaceful labor relations, good relations with local communities, better pest management and certainly better reputations (corporate image).

The biggest challenge now is how to integrate the RSPO, ISPO and the imminent MSPO and put the sustainability agenda under government leadership, while also including the involvement of private-sector stakeholders.

Because a global platform, even if it is led by multinational companies or NGOs, cannot be seen as dictating or influencing the policies of sovereign countries.

The writer is a senior editor of The Jakarta Post