Environment

Forest pledges multiply as palm oil companies respond to clean-up demands

2011-12-21T084224Z_01_JAK01_RTRIDSP_3_INDONESIADeforestation in Indonesia (Photo by Roni Bintang)

The number of multinational companies that say they are committed to supplying and using only deforestation-free palm oil is growing fast. More than twenty global food companies have now made no-deforestation pledges and the big traders Wilmar International and Golden Agri-Resources (GAR) have both made commitments that are far stronger than the standards established by the much-maligned Roundtable on Sustainable Palm Oil (RSPO).

The palm oil giant Cargill International has also made a no-deforestation pledge and has joined The Forest Trust (TFT) – a UK-based, non-profit organisation that helps companies and communities deliver their products responsibly. The agribusiness heavyweight Bunge said recently that it would also keep forest destruction out of its palm oil supply chain.

Much still needs to be done: peat forests in Indonesia are still being burnt to a cinder to make way for oil palms, orangutans and tigers are being pushed closer to extinction, land-grabbing continues, and many people are working for slave wages on  plantations, including those run by RSPO members.

tripa burns 20120613aceh07Burning of the Tripa peat forest in Aceh, Indonesia, to make way for palm oil.

Over the past 25 years, the total plantation area of oil palm has tripled, with current global estimates of more than 15 million hectares.

Malaysia continues to expand its palm oil cultivation, not least in Sarawak, which has already lost huge swathes of its forest, and the palm oil companies are clearing forest land not only in  Southeast Asia, but also in Africa and South America.

Most areas planted with palm oil were once forest, so the term deforestation-free means there has been no deforestation since a particular date. To qualify for RSPO certification, a plantation has to be deforestation-free since 2005.

Companies can commit to no-deforestation and be listed as selling certified palm oil from one plantation, but be deforesting elsewhere. They can say they produce sustainable palm oil, but only be doing this in one small area.

The fact that a company belongs to the RSPO doesn’t mean it is a certified producer, although all grower member companies are supposed to work towards certification and give a time-frame (the time-frame they give is often very lengthy). Also, certification applies to individual plantations, not companies. While the RSPO lists all of its members, it only lists plantations that have been certified.

Massive challenges clearly remain, but when a company like Wilmar draws up a policy as radical as the one it now has in place, it is a huge step forward.

“Everyone in the supply chain is critically important,” said TFT executive director, Scott Poynton, “but the real breakthrough came when Wilmar signed on.”

Poynton says Wilmar’s palm oil policy is the best one he has ever seen. NGOs are right to spotlight palm oil offenders, he says, but it’s also important to give credit to companies when it is due. “Wilmar was key in giving consumer companies confidence to move down this path.”

Wilmar has committed to no development of High Carbon Stock (HCS) forests or High Conservation Value (HCV) areas, no burning, a progressive reduction of greenhouse gas emissions on existing plantations, and no development on peat, regardless of depth.

Its commitment also includes zero tolerance of child, forced and bonded labour and no exploitation of local communities. This includes respecting the rights of indigenous and local communities to give or withhold their Free, Prior and Informed Consent (FPIC) to operations on lands to which they hold legal, communal or customary rights.

It expects all of its suppliers to comply with its policy by the end of 2015.

TFT was instrumental in bringing about the change at Wilmar. The other driving force was the US-based Forest Heroes campaign, headed by Glenn Hurowitz.

Thousands of consumer companies use palm oil, but most of them use small quantities, Hurowitz says. Unilever, he says, is the world’s biggest palm oil consumer, but it only uses about three percent of the world’s palm oil so it would take a very long time to go company by company and try to end deforestation that way.

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“We decided that the way we could transform the palm oil industry was by focusing on the big traders that stand astride global agriculture. We zeroed in on the six companies that stood at the pitch point of global agricultural trade, and, within that, Wilmar stood out as the most important one.”

Wilmar is not only the world’s palm oil titan, but also the biggest soy importer into China, the biggest soy buyer in Latin America, and one of the world’s biggest sugar companies. “They have the capacity to influence not just the palm oil business, but other commodity businesses as well,” Hurowitz said.

“There are certainly still problems in Wilmar’s supply chain, but the company seem to be addressing them seriously and we are hoping that – along with the other companies that have adopted no-deforestation policies – suppliers will now see this as the industry norm.”

TFT, Hurowitz says, plays a unique role “because they are able to not just tell companies that they can change, but actually show them how to do it”.

About 60 percent of palm oil production (about 50 million tonnes) is now covered by zero-deforestation commitments, but most of these are policy pledges for the future, not implemented actions. The timescales for compliance vary from company to company. Some date as far ahead as 2020 and there are many calls for more rapid action.

“I think 2020 deadlines are too far away,” Poynton said. “We want people to act now. We accept that it might take that long, but, if you set a 2020 deadline, you’re generally not going to start acting until 2019.”

Heavyweight leverage

There are those who dismiss all of the no-deforestation pledges made by the multinationals as mere greenwashing, but Poynton sees individual company commitments as the way forward.

Wilmar and GAR both have huge leverage. Wilmar controls more than 45 percent of the global trade in palm oil and GAR produces about five percent of the world’s supply. More than 80 percent of palm oil companies sell to Wilmar (they have more than 400 major palm oil suppliers).

Wilmar made its sustainability pledge in December 2013 and, in May this year, GAR extended its forest conservation policy across all of the palm oil it produces, sources, and trades. Recent data from the Indonesian policy development institute Greenomics shows that GAR’s pledges are translating into concrete action in the field.

In a report in September 2014, however, Greenomics said that two of Wilmar’s third-party suppliers – one in Indonesian Borneo and one in Sumatra – had been involved in clearing forest land since the announcement of Wilmar’s pledge.

Wilmar came under particularly heavy fire in the Greenpeace report ‘Licence to Kill’, published in October 2013. Greenpeace said Wilmar was trading with companies whose operations included illegal clearance, fires on peatland and extensive clearance of tiger habitat, and had no proper systems in place to ensure traceability in its supply chains.

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With the major traders in the palm oil industry now acting on deforestation, however, the smaller companies supplying them will need to stay in line if they want to stay in business.

More monitoring is clearly required to ensure that pledges are being implemented and there are numerous palm oil companies who have no concern whatsoever for the environment, but, after decades of hard work by conservationists and consumer activists, it seems that dirty palm oil is finally being driven out of the market.

About thirty companies have now signed up to work with TFT and have strong deforestation commitments, Poynton says. “There are others, such as Colgate and Procter & Gamble, who aren’t working with us, but have followed the lead that was started with Nestlé back in 2010. If suppliers want to sell their oil to these companies, they have to come on board on no-deforestation.”

A significant initiative was taken in New York in September. Wilmar, Cargill, GAR, and Asian Agri signed the Indonesia Palm Oil Pledge, an agreement that includes a commitment to greener palm oil development policies, more social benefits for workers, and further cooperation in establishing a mechanism to implement pledges. The signatories have also called on the Indonesian government to do more to protect forests.

Hurowitz welcomes Asian Agri’s new pledge, but says he still has concerns about the company. “Its parent group, Royal Golden Eagle, which owns one of the biggest pulp and paper companies in the world, has continued to engage in egregious deforestation.”

The Indonesian Chamber of Commerce (KADIN) signed the New York commitment, and Poynton sees this as a very positive development. “KADIN is not really politically powerful, but it is the business chamber of commerce, so it does have a voice,” he said.

Hurowitz says companies are starting to clean up their supply chains, but there needs to be government action. “There is now a political opportunity for the Indonesian government to protect forests long term. It is up to the government to seize that opportunity. We’re hopeful that this is Indonesia’s Brazil moment when it finally breaks the link between agricultural production and deforestation.”

There are concerns, however, about the recent merging of Indonesia’s forestry and environment ministries by the new president Joko Widodo.

The merger has not been welcomed by Greenpeace, where there are worries that the powerful forestry ministry could usurp some of the ministry of environment’s authority.

Greenpeace Indonesia’s chairman Longgena Ginting notes that the environment ministry is in charge of monitoring public officials who issue forestry permits and filing lawsuits against those who break the rules while the forestry ministry actually issues the permits.

One wonders whether court victories against palm oil companies like the recent ones in the province of Aceh will be achievable in the future.

Abetnego Tarigan, the chairman of WALHI (Friends of the Earth Indonesia), told the Jakarta Post newspaper: “Amid the paradigm of exploitation in our country, combining exploitation and conservation authorities into one body does not guarantee balanced decision making. The paradigm is influenced by the point of view that conservation is costly while exploitation is a source of income to the state.”

Chris Lang, writing on redd-monitor.org, said the merger could be a sign that Jokowi is serious about improving the management of Indonesia’s forests. “There is little doubt that reform of the governance of Indonesia’s forests is urgently overdue. The impact on REDD in Indonesia could be interesting, as it could prise some control of forest land from the forestry ministry – control that the ministry jealously guards.”

The UN-REDD programme is aimed at reducing emissions from deforestation and forest degradation in developing countries. Under the scheme, major financial incentives can be granted to developing countries that fulfil emission-reducing criteria.

Palm oil manifesto

Poynton and Hurowitz prefer not to use the word sustainability; they would rather talk about acting responsibly.

“The word sustainable shouldn’t be used in reference to any industry,” Poynton said. “It is the biggest greenwash that we have ever created. Many negative things are done under the banner of sustainability.”

The new Sustainable Palm Oil Manifesto announced by leading producers in July this year is one example Poynton would cite. The manifesto signatories say their initiative goes beyond RSPO standards, but, at its launch, Poynton felt it was just an exercise in greenwashing.

Greenpeace says the manifesto will undermine consumer companies’ recent commitments to remove deforestation from their palm oil supply chains.

Five oil palm growers – who together produce more than nine percent of the world’s palm oil – are among the manifesto signatories:

  • The Malaysian multi-national, Sime Darby;
  • The Malaysian conglomerate, IOI Corporation Berhad;
  • The Musim Mas Group, which is headquartered in Singapore;
  • The multi-national Kuala Lumpur Kepong Berhad, which was recently exposed for its controversial involvement in deforestation in Indonesia and land-grabbing and human rights violations in Papua New Guinea and Liberia; and
  • The Indonesian company Asian Agri/Apical, which is owned by tycoon Sukanto Tanoto. In 2012, the company was fined more than 200 million US dollars for tax evasion.

Cargill is another manifesto signatory.

Sime Darby’s group CEO, Seri Mohd Bakke Salleh, said the manifesto represented an important milestone for the palm oil industry. “As the world’s leading palm oil producers, we want to make clear our commitment to driving progress towards sustainability in the industry, and across all sustainable agriculture, and to leading by example,” he said.

When the manifesto was launched, the head of Greenpeace International’s Indonesia forest campaign, Bustar Maitar, said it was not a milestone.

“Greenpeace does not support a process that allows companies to claim ‘no deforestation’ while their manifesto allows them to continue to clear forests. Indonesia’s forests are disappearing faster than anywhere else in the world, and the level of action must match this urgency.”

The new manifesto doesn’t require signatories to halt the clearance of potential HCS forests and peatlands immediately and doesn’t accept the current HCS forest definition and thresholds. “While the signatories are discussing how to determine which forests to develop or protect, deforestation will continue,” Greenpeace said.

Poynton says that companies in the manifesto group have now pledged to stop clearance. “This is a really positive thing, and the manifesto group and the HCS Approach steering group are talking to each other, and this is also positive.”

The US-based Rainforest Action Network (RAN) described the initiative as a talk-and-log manifesto, and said it fell short of the new global benchmark for responsible palm oil. “It is a far weaker commitment than the robust policies recently adopted by other palm oil producers and traders, including Wilmar and Golden Agri-Resources.

“It will not adequately address the current deforestation and climate crisis caused by palm oil expansion as it fails to require an immediate halt to the destruction of rainforests and peatlands throughout the signatories’ supply chains.”

The executive director of the Orangutan Land Trust, Michelle Desilets, also sees the new manifesto as a greenwash. “It falls short of the objectives set out by the Palm Oil Innovation Group (POIG) charter.”

large orangutan rescueAn adult male orangutan captured for re-release after its home forest was cleared for palm oil  in Tripa. Photo taken by Paul Hilton in April 2012.

 Palm oil innovation

The POIG was set up in June 2013. Its founding members include the Daabon Group, headquartered in Colombia, New Britain Palm Oil, which operates in Papua New Guinea and the Solomon Islands, Agropalma in Brazil, Greenpeace, RAN, the WWF, and the Forest Peoples Programme.

The group describes its focus as “environmental responsibility, partnerships with communities, and corporate and product integrity”. It says the RSPO principles and standards are inadequate.

Desilets says the manifesto signatories are showing some commitment to go beyond the RSPO, but lines are being purposely blurred to mislead buyers. “What is to prevent them showing complete commitment to the standards already identified either through TFT’s HCS method or the POIG?

“If companies are really serious about deforestation-free and sustainability, the POIG charter is the answer. I suspect that, like the Malaysian Sustainable Palm Oil and Indonesian Sustainable Palm Oil¹ schemes, this is yet another attempt to confuse buyers.

“It’s going to be up to the NGOs and the consumers themselves to differentiate between what is truly responsible palm oil and what are half-hearted stabs at sustainability.”

Desilets says the new manifesto doesn’t encompass free, prior, and informed consent, and this leaves the way open to land grabbing of community forest areas.

David Dellatore, who is programme manager for the UK-based Sumatran Orangutan Society (SOS), points to the vagueness of some of the manifesto commitments. “I hope it will prove to be more than an empty proclamation of intent. There is room in such documents for irresponsible outfits to do as they like and still remain under the manifesto banner.

“We have to keep reminding them, and any other venture purporting to support similar goals, that the onus is on them to prove to the world that they are doing the work properly and improving and/or operating on improved practices. There need to be positive and lasting changes on the ground.”

No third-party commitments

The new manifesto doesn’t bind signatories to adhere to its principles in all of their operations and there is no clear commitment to apply the principles to third party suppliers who may continue to clear forests, expand onto peatlands, and violate human and labour rights.

“This is a green light to continue to source Conflict Palm Oil from third party supplies and undermines the progress that is being made by peers to transform the palm oil sector,” RAN said.

The manifesto has no detailed, time-bound implementation plan and lacks a transparent system of progress auditing, verification, and monitoring. There are no open grievance mechanisms or dispute resolution processes.

“It will not result in the rapid supply chain changes needed to end the widespread human and labour rights violations, unchecked deforestation, and climate pollution caused by Conflict Palm Oil production,” said RAN’s research and policy advisor, Bill Barclay. “If this initiative was the only action taken by the manifesto’s signatories, it could undermine the very real progress being made towards achieving truly responsible palm oil on a global scale.

“Consumer companies such as Nestlé, Unilever, Kellogg, Mars, and Mondelez should not be tricked into believing this is more than an exercise in greenwashing.”

Food producers

In one of the most recent consumer company announcements, Dunkin’ Brands – which owns Dunkin’ Donuts and Baskin-Robbins – committed to buying all its palm oil from sources that do not cut down the rainforest.

Doughnut giant Krispy Kreme has said it is moving towards zero-deforestation production by the end of 2016. It says suppliers who are not in compliance by then will be required to submit a viable action plan for closing any identified gaps, or risk removal from the brand’s supply chain.

The food giant Mars is working in partnership with TFT to put its sustainability policy into action. It says it is on track to meet its commitment to achieve 100 percent traceability of its palm oil supplies by the end of this year and has asked its suppliers to confirm compliance with its sourcing charter by the end of 2015.

The chocolate producer Hershey has also become a member of TFT and has pledged to cut deforestation and exploitation out of its palm oil supply chain. The company says it is committed to sourcing 100 percent traceable and responsible palm oil.

McDonald’s says that 100 percent of its palm oil purchases will be certified by the RSPO by 2020. Many consider this to be a very weak commitment, with a deadline too far into the future.

Unilever, which is one of the world’s biggest palm oil buyers, has also set a 2020 deadline for tracing all of its sustainably sourced palm oil back to the plantation on which it was grown.

The US grocery giant Safeway is another company that this year committed to buying only deforestation-free palm oil that is “free of expansion on carbon–rich peat lands, not developed or expanded on illegal or customary use lands without the free, prior and informed consent of local communities and free of human rights violations including forced and child labour, human trafficking and poor working conditions”.

Translating messages into action

Sustainability consultant Shayne McGrath says companies are getting better at selling packaged no-deforestation messages. Much needs to be done before their promises translate into true sustainability in the field, he says, “but there is a now a greater expectation from the marketplace and consumers for companies’ pledges to be delivered upon”.

McGrath has been working with the private sector, the government, and NGOs in Sumatra for more than three years.

He says there needs to be more investigation of supply lines. “Before you can have sustainability, you need traceability. It is still hard for companies to work out which concession is the source of the oil they are buying. Until this problem of traceability can be resolved, sustainability is greenspin; it’s a myth.”

McGrath says companies’ commitments need to be seen in context. “It is just greenspin to talk about zero-deforestation policies in somewhere like Riau in Sumatra. The province has already lost 80 percent of its forest cover.”

Most of the fires that cause the annual choking haze in Indonesia, Malaysia, and Singapore originate in Riau.

“Despite ten years of loss, the Indonesian forestry department and the big NGOs like Greenpeace and the WWF are trying to portray these deforestation policies in Riau as a success, and this is dishonest,” McGrath said. “The forest has already all been cut down in Riau. There’s nothing left to deforest.”

Desilets says that sustainability commitments cannot be piecemeal, with companies pledging one standard and target date for Europe or the US and another standard for the rest of the world. “To be worth anything, the commitments need to be global and apply to a company’s entire production.”

Poynton says sustainability cannot exist in an industry that is still using so many chemicals and in which, in Malaysia, there is such widespread exploitation of immigrant workers.

He talks about the palm oil dilemma. “On the one hand, the palm oil industry has had a huge benefit on poverty reduction and rural development in Malaysia and in Indonesia, where there was huge migration into the slums of Jakarta.

“The industry has brought jobs. Hospitals and clinics and schools have been built. The palm oil industry has been outstanding as a path to helping people have better lives, but it has come at the expense of vast areas of forest and peatland and is endangering species like the orangutan.”

 Forest destruction

It was revealed at the end of June that forest clearance in Indonesia – the world’s biggest palm oil producer – had for the first time surpassed the clearance rate in Brazil.

A study published in the journal Nature Climate Change showed that that 6.02 million hectares of virgin forest were lost in Indonesia from 2000 to 2012, largely to make way for oil palm plantations.

By 2012, annual primary forest loss in Indonesia was estimated to be 840,000 hectares, as compared with 460,000 hectares in Brazil.

According to the United Nations Environment Programme (UNEP), oil palm plantations are the leading cause of rainforest destruction in Indonesia and Malaysia, who together produce close to 90 percent of the world’s palm oil.

As the forests disappear so do the habitats for endangered species like orangutans and tigers. Experts say that, because of habitat destruction, orangutans are in danger of extinction in an area of Indonesia where they used to be present in their thousands.

Up to one hundred orangutans are thought to have perished in forest clearing and peat burning by palm oil companies in the Tripa peat forest on the island of Sumatra. There were between 2,000 and 3,000 orangutans in the area in the 1990s, but only a few hundred are left today.

And it is not just orangutans and tigers that are endangered. The International Union for Conservation of Nature says that if habitat destruction continues at the current rate, the Sumatran elephant could be extinct within thirty years. “Effective action on the ground should be taken immediately to protect Sumatran elephants from extinction, especially in Riau,” the union said in a report in 2013.

rescued orphan orangutanA 2-year-old orphaned orangutan confiscated from a village on the edge of the Tripa peat forest in April, 2012. The orangutan was suffering from malnutrition, his skin was in bad condition, and he had a wound from being tied up with a rope. Photo: Paul Hilton/SOCP/YEL.

The director of the Sumatran Orangutan Conservation Programme (SOCP), Ian Singleton, says that not only are the wildlife in Tripa perishing, local people are having their livelihoods destroyed.

“The working conditions on the plantations are horrendous. Local people don’t want to work there; the wages are too low. People come from the islands of Simeulue and Nias; they are the only people willing to work for such awful wages in such dreadful conditions.

“Most of these plantations are in areas where local people claim ownership of the land because it belonged to their grandparents, but these people were just kicked off their property. Not only is this industry not paying dividends to local people through employment, it is actually robbing them.

“And Tripa is on the coast. It is barely one metre above sea level and the land surface is now being lowered because the peatlands are being drained. And all this in an area that has already been hit by a tsunami.”

IMG_7377Tripa burning in 2012; photo by Carlos Quiles.

Nearly all the plantations in the province of Aceh are owned by people who don’t live in Aceh, Singleton says. “None of the money made on the plantations stays in Aceh.”

Another area of Indonesia that has been devastated by fire is Tesso Nilo National Park in Riau. Half of it is now bare land, Poynton says.

“It’s been burnt to the ground. Mafia guys pay communities to burn these areas. The palm oil companies aren’t blameless. They could invest more in putting out the fires, and they could have better relations with the local communities so they don’t go and light the fires.”

Expansion in Malaysia

Statistics from the United Nations Food and Agriculture Organization show that Malaysia’s annual deforestation rate jumped almost 86 percent between 1990 and 2000 and between 2000 and 2005.

Between 1983 and 2003, there was a reduction of about 4.9 million hectares of forest cover – an average of 250,000 hectares of forest lost annually.

Malaysia has lost an average of 140,200 hectares – 0.65 percent of its forest area – per year since 2000. Between 1990 and 2010, it lost an average of 96,000 hectares, or 0.43 percent, of forest cover per year and in total lost about 1,920,000 hectares – or 8.6 percent.

According to statistics released by the RSPO last year, some 3.5 million hectares of forest in Indonesia, Malaysia, and Papua New Guinea were converted for oil palm plantations between 1990 and 2010.

Between 2000 and 2012, the area of the Malaysia planted with oil palms increased by 17,000 square kilometres.

Poynton says Malaysian companies were slow to get on board on no-deforestation and are not really grappling with the key issues. “It’s taking time to open doors in Malaysia, but we are seeing a change in tone as companies see how their businesses can benefit.”

Hurowitz has also seen resistance to no-deforestation policies in Malaysia, but says most Malaysian companies are highly dependent on the big agricultural traders so will need to change to stay in the market.

“They’ve shown some signs of movement and said they will implement a moratorium on the destruction of HCS forest while they are studying this issue. However, they didn’t define what they meant by HCS forest so it’s a little unclear.”

Hurowitz describes the Malaysian state of Sarawak as the global epicentre of peat clearance. “The state government has plans to clear two million more hectares of peat forest.”

When Wilmar launched its no-deforestation policy, the Sarawak palm oil companies and the state government reacted very negatively, Hurowitz says. “Wilmar went out to Sarawak to explain the policy in more detail, but it has still been a real problem. Sarawak is probably the jurisdiction where these deforestation-free policies face the biggest political challenge.

“We’ve had CEO-level meetings now with the major Sarawak palm oil companies so there is hope, but I think the jury’s out on whether Sarawak is going to change or not. If they don’t change, I think they will find it very difficult to access the global market.”

The new Malaysian Sustainable Palm Oil (MSPO) standard that is due to be launched in January 2015 is considerably weaker than the RSPO principles and criteria. It will start off as a voluntary standard, but may become mandatory in stages. The government says the standard’s principles and criteria have been finalised and field trials have been completed.

Segregation

Palm oil supplies from different plantations, mills, and even countries, are intermingled at each stage of production and delivery, so it is usually impossible for purchasers to know exactly where a supply of oil has come from, and how it has been produced.

New Britain Palm oil is one of very few companies that have a vertically integrated supply chain so can have full traceability. (The company owns the plantation, the mill, the freighters, and the refinery in Europe.)

Ian Singleton argues that a small company that is producing just 100 litres of sustainable palm oil would not be able to afford the astronomical shipping costs to segregate its oil. “It would become a non-viable product.”

Poynton says segregation adds a huge cost onto the oil and that’s why so little of it is being bought.

Poynton tells palm oil traders that they don’t have to segregate their oil. “Refineries have a catchment of suppliers and the refinery owners have complete leverage over those companies because palm oil needs to be moved from the plantation to the mill very quickly. They can decide whose oil they are prepared to buy.”

TFT visits mills and plantations, checking company practices. “It’s not an easy task,” Poynton said, “and this is where we need to work with the local NGOs. It’s about using everyone’s skills and leverage to bring about change.”

Hurowitz doesn’t think the RSPO segregation approach has worked. “Companies are selling palm oil to western companies from areas in peninsular Malaysia that were cleared decades ago then they use the premium that they get from selling RSPO-segregated palm oil to finance deforestation on the frontier in Sumatra or Borneo or Africa.”

GreenPalm certificates

Many companies rely on GreenPalm certificates to fulfil their targets for the use of Certified Sustainable Palm Oil (CSPO).

Unilever states that 100 percent of its palm oil was sustainable as of 2012 – but this is largely because of GreenPalm.

Under the book-and-claim system, RSPO-certified palm oil producers are awarded one GreenPalm certificate for each tonne of palm oil that has been sustainably produced. They can put the certificates up for sale on the GreenPalm web-based trading platform then manufacturers or retailers can bid for and buy the certificates on line. Companies can then state that they have supported the sustainable production of palm oil, but there is no guarantee that all of their palm oil comes from sustainable sources.

Green Palm howitworks

GreenPalm is highly controversial. Some say the system is a disgrace and should be done away with, but others say the certificates are helping to increase the amount of sustainable oil on the market.

Scott Poynton says GreenPalm is a massive greenwash.

“It’s the most disgraceful, environment-destroying process that I’ve ever seen in my life. WWF are a disgrace for supporting GreenPalm so strongly. It’s a distortion of the marketplace by a false sustainability claim that allows business as usual.”

Desilets would disagree. She understands consumers who would reject the GreenPalm system and want to buy products containing only directly certified, segregated palm oil, but says there is a place for the certificates in the current supply chain.

They can be particularly appropriate, Desilets says, for companies that produce personal care products and find it difficult to get sufficient quantities of segregated derivatives.

“The certificates can also be of help to smallholders, who provide about a third of the world’s palm oil. It is absolutely necessary to give smallholders the opportunity to enter into a sustainable supply chain and this is where GreenPalm can come in.”

The problem, Desilets says, is when companies who do have access to physical CSPO continue to use Greenpalm to cover their usage. “This undermines the uptake of the physical CSPO – of which only 51 percent is being purchased – and this can be a disincentive for growers to become certified.” Desilets would support a move to set a minimum GreenPalm price that is more in line with the cost of the premium for physical CSPO.

Poynton says that, with GreenPalm, you don’t know where your oil comes from so you cannot know if you are causing deforestation or destroying people’s lives. “On the GreenPalm website they make of virtue out of the fact that you don’t have to change your business; you’ve just got to pay them a little bit of money and you can claim your oil is sustainable.

“The average price for a certificate is three bucks. The system is dressed up to make it seem like the money goes to the growers and incentivises them, but they only get one dollar more than the current price. A dollar goes to the RSPO, a dollar goes to GreenPalm for administration, and a dollar goes to the grower. That’s not much of an incentive to do the right thing.”

There are hardly any certified smallholders that are getting GreenPalm money, Poynton says. “They haven’t got any certificates to sell.”

Buyers, Poynton says, can buy their oil from wherever they want. “They can buy the cheapest, nastiest, most horrendous oil the world has ever seen, and just have to pay an extra three dollars a tonne to have a GreenPalm certificate. If a company did what the WWF and the RSPO and GreenPalm are doing, the NGOs would tear them apart for greenwashing.”

The system is painted as a necessary evil, Poynton says, because it makes up about half of the RSPO budget. “Without it, the RSPO would cease to exist.”

Hurowitz says GreenPalm is “just a scam” – a subsidy for deforestation. He compares it to what is happening with segregation, but says it is clearer and even worse. “The palm oil companies are using the proceeds from the GreenPalm certificates to finance deforestation on the frontier.”

Johnson & Johnson defends its use of GreenPalm. “It allows us to demonstrate our support for CSPO while we work toward achieving our Healthy Future 2015 goal of sourcing all palm oil and palm oil derivatives from certified sustainable sources,” said sourcing manager Simon Perry.

Krispy Kreme is another company that uses GreenPalm. It is meeting its sustainability commitments through a sourcing combination of RSPO-certified segregated supply, RSPO mass balance mixed-source supply, and the purchase of GreenPalm certificates.

The mass balance model requires processors to purchase palm oil from certified sources, but allows them to mix it with conventional palm oil during transportation, processing, and packaging.

“Everything to do with sustainability and palm oil is a matter of degrees and spectrums,” said Desilets. “At the very least, you would expect an EU company to cover 100 percent of its use of palm oil with GreenPalm certificates and there is no excuse for anything less. If they cannot source the physical CSPO, then they should be buying up those certificates.”

Ian Singleton also thinks the GreenPalm system is of value. “I don’t care whether the oil is segregated or not; I want the amount of sustainable palm oil increasing until hopefully it eventually becomes 100 percent.

“I don’t mind if I have bought the one percent that isn’t sustainable as long as I am helping promote the production of the 99 percent that is.”

Because of the lack of buyers willing to pay the premium for CSPO, 49 percent of it is being sold as conventional oil.

Many buyers prefer not to even attempt to purchase physically traceable oil, but instead opt for GreenPalm certificates because this works out cheaper and the purchasers can still say they are buying sustainable oil.

Of the 49 percent of Certified Sustainable Palm Oil not sold as CSPO,‎ a large volume is sold as “sustainable biofuel”, using the additional International Sustainability and Carbon Certification (ISCC). Unlike CSPO, these volumes are not traced in a central database, so it is not known how much is being sold.

Consumer pressure

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Greenpeace and RAN have both called on consumer companies to use their buying power to tell suppliers to demand forest protection and resolve the conflicts in their supply chains.

Calen May-Tobin, from the US-based Union of Concerned Scientists, says companies’ recent sustainability announcements demonstrate the influence that consumers can have in instigating change.

Nestlé, he said, used to have one of the worst sustainability reputations, but responded to a consumer outcry, motivated by a Greenpeace campaign, and became the first company to commit to deforestation-free palm oil.

TFT worked closely with Nestlé on its sustainability pledges. Poynton says the company is now sending strong market signals throughout its supply chain that are having a big impact. “They deserve great credit. They’re operating fundamentally from a values base, not from any push for certification.”

Poynton says the pledges made by the consumer companies give traders like Wilmar confidence in the changes they are making. “The traders then know that these companies will be buying their oil.”

Krispy Kreme and Dunkin’s brands commitments can also be tied to public pressure, says May-Tobin. “UCS and other groups rallied Dunkin’s customers to voice their concerns at the company’s annual shareholder meeting in May and attended Krispy Kreme’s new store openings in Tennessee, Delaware, and Florida.

“What we have seen time and again is that when consumers speak, companies listen, and act.”

In the UCS’s analysis of companies palm oil use, Donuts, Deodorant, Deforestation, eight out of ten fast-food companies received a zero score because their commitments were inadequate or, in some cases, non-existent. “It’s therefore promising to see two fast food companies taking this issue seriously,” May-Tobin said.

It was two girl scouts in the United States, Rhiannon Tomtishen and Madison Vorva, who put the most public pressure on the food manufacturing company Kellogg, challenging it for using palm oil in its Girl Scout cookies.

In a lengthy campaign, the girls highlighted the deforestation being caused by oil palm cultivation and the threats to endangered species. They eventually persuaded Girl Scouts of the USA to make a sustainable palm oil commitment and are still pushing for stronger action to protect forests and wildlife.

In February this year, Kellogg pledged to buy only fully traceable palm oil that has been produced in an environmentally responsible manner.

Rainforest and kelloggRAN’s Kellogg campaign

The sustainability commitments from Wilmar come after years of campaigning by environmentalists and human rights groups, who pointed to the deforestation caused by the company and its purchasing of “dirty palm oil” from third party suppliers.

Michelle Desilets says GAR has come a long way since the days when it was considered to be the pariah of the palm oil industry. “They’ve listened to the NGOs and they’ve really picked up the sustainability baton and run with it.”

P1020464Research being done on yields at the PT Smart Research Institute in Riau, Sumatra. PT Smart is a subsidiary of Golden Agri-Resources.

Desilets even has good words to say about Sime Darby. “They’ve also come a long way and they give a huge amount of money to conservation and social causes. They are certainly not the worst, but they could do more.”

The campaign director for the Forest Heroes campaign, Deborah Lapidus, said: “More and more consumers, investors, and suppliers around the world have shown that zero- deforestation palm oil is possible – and is increasingly what consumers and investors expect.”

Forest Heroes campaigned hard to convince Bunge – whose customers include Dunkin’ Donuts and Krispy Kreme – to announce a forest conservation policy and take action in the Malaysian state of Sarawak on the island of Borneo. It’s estimated that a third of peatland in Sarawak was cleared between 2005 and 2010 and there are plans for millions more hectares to be cleared in the future.

Bunge is the company that buys most palm oil from Sarawak.

Forest Heroes also lobbied the doughnut companies to announce their own forest conservation policies.

The group had initially named Bunge as a problem supplier in its Deforestation Doughnuts report, published in June this year, but recognised progress by the company in its recent Green Tigers report, which ranks the palm oil industry’s top suppliers, judging them on forest protection and their human rights records.

Bunge, which is headquartered in White Plains in the US, says it is committed to building a traceable supply chain for all of the palm oil and derivatives it trades or uses in its products. Its pledge includes the protection of HCV areas and HCS forests; protection of peat areas, regardless of depth; no burning; the prohibition of forced and child labour and the discrimination and harassment of workers; and respect for local and indigenous community rights and the application of FPIC for land purchases and use.

In a Green Tigers report update in October, Forest Heroes lists Indofood, KLK, Musim Mas, IOI Loders Croklaan (the marketing arm of the IOI group), First Resources Limited, and Astra Agro Lestari as “irresponsible suppliers”.

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Poynton says consumer pressure gives a mandate to NGOs like Greenpeace and the Environmental Investigation Agency to act and demand the attention of companies they target.

“Consumer and NGO campaigns are very important,” Poynton said, “but it’s vital not to take the moral high ground. We need to be sitting down in rooms with the CEOs of these companies and appealing to them as people, not as enemies to be defeated.”

Hurowitz says Wilmar’s CEO, Kuok Khoon Hong, deserves huge personal credit for leading the current transformation of the palm oil industry.

“He was really concerned about the haze in Singapore and the environmental pollution that he sees in China. He sees that Asia needs to change and he feels a responsibility to make it happen. Once Wilmar decided to make the shift, they have been quite aggressive about implementing it.

“It’s partly what has become an actual deep commitment to conservation; it’s also partly evidence of effective, fast-moving business practice.”

Hurowitz says Wilmar has cut off several companies that continue to cut down forests or have been unwilling to engage seriously in discussions about their practices.

One company that has been pushed to change its activities is the Indonesian palm oil supplier Bumitama Agri. “They have been engaged in deforestation, orangutan habitat destruction, and peatland clearance,” Hurowitz said. “Wilmar and GAR buy almost all of this company’s palm oil; they went to Bumitama and delivered the message that they had to change.”

As a result, Hurowitz says, Bumitama recently conducted a HCS assessment on five of its plantations and announced it was were setting aside 13,000 hectares of forest for conservation. “They’re saying they are going to work on a comprehensive policy by the end of the year. I think that shows some concrete progress, and other companies are engaged in similar processes.”

Targeted by Greenpeace

Several companies that were heavily targeted by Greenpeace for bad practices have now made sustainability pledges.

In a damning report entitled ‘P & G’s Dirty Secret’, produced in February this year, Greenpeace International accused the multinational Procter & Gamble of contributing to climate change, key tropical biodiversity loss, and social deprivation. It said the company was sourcing palm oil from companies that are destroying wildlife habitat in Indonesia.

Nearly 400,000 people emailed the Procter & Gamble CEO to demand a change in policy, and there were dozens of protests at the company’s headquarters in the United States.

0225-greenpeace-pg-head-and-shouldersGreenpeace campaign about Procter & Gamble.

Procter & Gamble listened, and, in a pledge published in April 2014, the company said it was aiming for traceability of palm oil and palm kernel oil from supplier mills by December 31, 2015, and from plantations by 2020.

The company has been working with the Malaysia Institute for Supply Chain Innovation on a six-month study to examine the practices of small farmers and see how those practices can be improved to benefit the farmers and protect local forests.

The Italian company Ferrero, which manufactures the Nutella spread and Ferrero Rocher chocolates, was also targeted by Greenpeace.

The company now has a strong sustainability commitment. It has pledged to purchase 100 percent traceable CSPO by the end of this year and says that, to accelerate the transformation to a truly sustainable palm oil sector, it is necessary to go beyond the RSPO certification standards.

In 2013, in collaboration with TFT, Ferrero launched its own Palm Oil Charter for suppliers.

There was controversy in France in 2012 over a failed attempt to introduce a “Nutella tax”, which would have imposed an extra 300-euro-per tonne tax on palm and coconut oil coming into the country for use in food for human consumption. Malaysia’s Palm Oil Council was outraged, and said the proposal was irresponsible and based on inaccurate information.

In its ‘Licence to Kill’ report, Greenpeace documented illegal oil palm plantations within Tesso Nilo National Park, harvests from which had previously been tracked to Wilmar’s mills. Greenpeace said oil palm plantations were driving the destruction of the national park, of which only a quarter remained.

“Although Wilmar has undertaken to preserve HCV forests and peatland on its own concessions,” Greenpeace said, “these areas supply less than four percent of the palm oil it trades and refines, with the remainder being produced by third-party suppliers.”

Labelling and logos

It’s currently very difficult for consumers to know which products have palm oil in them, and which contain certified oil. It’s also hard for them to know which sustainability standard is which and even if they can see, via a label, that oil is said to be responsibly produced, it is hard for them to know which standard is better than another.

In December this year, the European Union is set to introduce a labelling requirement for food oils. Under the new legislation, which will apply to all EU member states, the types of vegetable oil used in food products must be stated explicitly on the label. Manufacturers will no longer be able to hide palm oil in their ingredients under the generic term vegetable oil.

“This seems to be an incentive for some companies to secure at the very least Certified Sustainable Palm Oil,” said Michelle Desilets.

There is an RSPO logo, but it appears on just a few of the hundreds of thousands of products worldwide that contain palm oil, and research shows that people do not recognise or understand it.

“Despite admirable improvements in the last review of the principles and criteria,” Desilets said, “the RSPO standard falls short of what most people would consider truly sustainable – that is, that it should have prohibited the clearing of secondary forest and peatlands.”

There have also been concerns, she says, about rogue and laggard members of the RSPO, which has impacted the organisation’s credibility.

“We hope that soon we’ll be able to identify products that use 100 percent CSPO that is deforestation-free (produced by POIG growers, for example,) and perhaps be able to assist in that identification with a new logo that is easy to understand.”

Regardless of whether they are seeking RSPO certification or not, all RSPO members are bound by the roundtable’s New Plantings Procedures (NPP). Desilets says that, for many reasons, she thinks the NPP is the most important document in the RSPO because it is about preventative measures that have to be taken before a single blade of grass or tree is cleared and before even a road is built or a portakabin put up.

The issue of timelines, she says, is a contentious one and there is at least one company that says it plans to be certified as late as 2030. “There is no minimum or maximum timeline set and it is up to the members to argue if a company’s timeline is not ambitious enough.”

There are those within the RSPO who say there is a better chance of moving companies along by improving engagement and stimulating the market demand for CSPO than by setting a fixed maximum deadline for time-bound commitments, which would be difficult to enforce because the RSPO is a voluntary certification process.

Finnwatch report

A report was released in September this year by the Finnish business watchdog Finnwatch, which alleged that the IOI group had forced and slave labour contracts on their RSPO-certified plantations in Malaysia. “And the company is on the RSPO board,” Poynton said.

More than 80 per cent of the workers at IOI plantations are migrant workers from countries such as Indonesia, Bangladesh and Nepal. The report, “Law of the Jungle – Responsible Palm Oil Purchasing in Finland”, says that IOI confiscates workers’ passports and restricts freedom of association.

“The employment contract encourages workers to work up to 10-12 hour workdays,” said the executive director of Finnwatch, Sonja Vartiala. “Wages are based on the amount of palm oil bunches gathered, and workers do not receive compensation for overtime. Many workers do not earn even the statutory minimum wage.

“IOI deducts recruitment fees directly from its workers’ salaries, and pays workers a salary that is smaller than the minimum wage during their probationary period.”

In addition to being certified by the RSPO, the three plantations studied by Finnwatch also had International Sustainability and Carbon Certification (ISCC).

In response to the report, IOI said it would cooperate with the RSPO and the ISCC to improve its certification procedure. It said it was doing its own review of its labour policies and practices and would make further refinements or improvements to enhance the labour conditions in its estates.

The Finnwatch report criticises leading palm oil certifications for inadequate monitoring of working conditions.

“Certification assessments have turned a blind eye to labour rights violations,” Vartiala said. “The criteria for both certification systems require that workers are paid a decent living wage that exceeds the statutory minimum wage. In reality, it seems that the systems are unable to even monitor whether wages are in compliance with legislation.”

Finnwatch also blames EU regulations for the poor working conditions in palm oil production. “No responsibility requirements have been set for palm oil purchased by food and cosmetics companies, while the EU directives that apply to biofuels overlook social responsibility,” Vartiala said.

IOI Loders Croklaan is one of the main focuses for Forest Heroes. “Even this worst-of-the-worst company is facing pressure to clean up its act,” Hurowitz said. “We have been in negotiations with them and they’ve made a lot of improvements in their draft policy, but we are still concerned about the scope.

“One of the things that we find with many of these Asian conglomerates is that there are a lot of interlocking parts and not every part of the company is always open to scrutiny. That is one of the big issues that we are working on.”

 RSPO complaints

David Dellatore cites the Indonesian palm oil company PT Sisirau, against which the SOS filed an RSPO complaint. PT Sisirau has since resigned from the RSPO, so the complaint is now against the parent company, PT Ibris Palm.

There is proof that PT Sisirau cleared an area of forest containing orangutans. The RSPO complaints panel found enough evidence to conclude that there was secondary forest within the concession that supported a transient group. “PT Sisirau knew of this population of orangutans and failed to take corrective actions,” they said.

sisirau pic20519oic6Orangutan rescue on the PT Sisirau plantation.

The panel said PT Sisirau failed to stop all land clearing immediately upon discovery of the orangutans and, “despite repeatedly encountering the orangutans, did not undertake a HCV assessment of the concession area to verify and ascertain the population of the orangutans before resuming land clearing work.”

It said the company was in breach of RSPO criteria 5.1 and 5.2, and asked it to carry out several actions, including reviewing all its standard operating procedures. All remaining secondary forest and unplanted areas should be preserved as buffer, the panel said, “allowing the orangutans the freedom of movement between the concession and other concessions in the area and the nearby national park”.

The panel said a steep area, river and stream buffer should be established and enhanced to serve as refuge for transient orangutans and there should be socialization of the conservation areas with the local community to prevent harm to any orangutans that might exist in the area.

Discussions between the RSPO and PT Sisirau are ongoing. The RSPO says some of the requested actions have not been completed according to the stated timeline, and the compensation process has not been complied with.

Dellatore points to the amount of time and energy expended making the complaint against PT Sisirau “and a number of dangerous evacuations that we were forced to do regardless of the RSPO existing”.

He added: “I do believe the RSPO is trying to help, and a good number of the members are trying to do the right thing, but there are a few who just don’t care and are doing whatever they want.”

Dellatore says the final outcome of the PT Ibris Palm case is vital for the future credibility of the RSPO and if the company is allowed to remain within the RSPO, the system will be ruined for everyone.

“If this company is allowed to be certified, it means that you will have no idea if an RSPO-certified product came from cleared forest containing orangutans or not. When consumers pay a premium for certified oil, they expect that oil to have been produced without HCV forest being cleared, and in a manner in which orangutans are protected.

“Removing PT Ibris Palm would show the world and other companies that the RSPO has some teeth and is willing to protect its assets, its members, and its standard.”

The RSPO says that its compensation procedure in cases of land being cleared without prior HCV assessment is not a “clear-and-pay” mechanism, but there are those who say it is exactly that.

The Environmental Investigation Agency says that complaints against RSPO members who have violated its voluntary terms “are stymied by opaque bureaucratic procedures and a lack of clear process”. In a report released in 2013, the agency focused on the HSBC bank and its dealings with the Indonesian palm oil companies Bumitama and Triputra. It said HSBC’s reliance on the RSPO as an indicator of compliance with its policy was fundamentally misguided. “It is delegating responsibility for the protection of its professed principles to a broken system.”

According to the EIA, the RSPO lacks credible mechanisms to ensure members protect HCV forests. “When such violations are brought to its attention, the RSPO’s mechanisms for redress are insufficient to either compensate for the damage or serve as a disincentive to the same behaviour being repeated.”

Certification systems

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The Rainforest Alliance has developed its own certification system. According to the standards set by the Sustainable Agriculture Network (SAN), a plantation can be certfied by the Rainforest Alliance if no deforestation has occurred on it since November 2005. The alliance also demands that all damage since November 1999 is mitigated through reforestation, ecological preserves, and biodiversity offsets.

Senior vice-president of the Rainforest Alliance, Richard Donovan, says certification brings a written standard and transparency and can have a mainstream impact on a massive scale. “Certified palm oil is now above 20 percent and that’s been done in a relatively short period of time.”

The RSPO secretary-general Darrel Webber has described his organisation as “the most creative, the most diverse, the most innovative open network discussing sustainability for the palm oil sector today”.

Hurowitz says that if a certification scheme is trustworthy it can be a useful tool to ensure that particular companies are protecting the environment, but the challenge is that it relies on companies paying a premium for a certified product. “In a competitive marketplace, companies are not always willing to do that. I don’t know if certification can deliver wholescale industry transformation.”

“We have found companies willing to support improving standards across the board even if that raises costs to the whole industry, but they’re much less willing to take a cost disadvantage relative to their competitors just to achieve sustainability. They don’t mind paying a little extra if everybody’s paying a little extra, but they don’t want to be the only ones doing it.”

Beyond certification

Scott Poyton says the palm oil industry needs to go beyond certification. The RSPO standard, he says, is a weak initiative that was developed by the palm oil industry and was designed to allow business as usual. “It hasn’t stopped the destruction of forests because there’s no real incentive.”

By contrast, he says, if customers like Nestlé refuse to buy dirty palm oil, that’s a multi-million, or in many cases a multi-billion dollar point of leverage that, up until recently, hadn’t been used.

People may be sceptical about company pledges, Poynton says, but he has seen CEOs becoming very passionate about their own policies. “This doesn’t happen with RSPO certification; that’s just someone else’s standard, someone else’s box they need to tick.”

Poynton doesn’t think the RSPO has any scope to transform the palm oil industry. He has seen evidence of more progress being made when companies make their own commitments.

“When company leaders start talking about having no links to deforestation or the exploitation of people, I see a different emotional response and this is being converted into policies.”

The companies have real ownership of those policies, Poynton says, and follow them up. “These commitments are far-reaching and deeply embedded in the company identity, which gives us great hope that they will be implemented. And they are being implemented.”

Hurowitz says the Forest Stewardship Council, which certifies timber, has much better governance and much higher standards in general than the RSPO or any of the other agricultural commodity roundtables.

“Outside of any certification scheme, we need this broader approach where you actually get the companies to change their whole operations regardless of certification.”

Desilets says the Orangutan Land Trust remains very active within the RSPO, working to try and improve on its shortcomings, but is also now a member of the POIG. She believes it is possible to go beyond the RSPO standard and demonstrate truly responsible palm oil production.

Commitment scorecards

The Union of Concerned Scientists produces regular scorecards, which rank the palm oil sourcing commitments of top companies in the packaged food, fast food, and personal care sectors. The card it published in March 2014 showed that 24 of the 30 top companies had inadequate commitments or lacked commitments altogether.

The fast food sector was the worst, and the personal care sector scores were mixed. Nearly all the packaged food companies, except Kraft Foods, had commitments, and some were high achievers. Several companies, including Dairy Queen, Kraft Foods, Domino’s Pizza, and Wendy’s, have no palm oil commitments at all.

“In our scorecard,” May-Tobin said, “the packaged food sector scored the highest in part because those companies have been subject to years of public campaigning.”

Six companies on the scorecard – the personal care companies L’Oréal and Reckitt Benckiser and the packaged food companies Mondelēz, Nestlé, Unilever, and Kellogg – have committed to purchasing palm oil that is deforestation-free, peat-free, and can be traced in a transparent way.

fast food cos

packaged foods

personal care cos

The WWF also produces a palm oil scorecard. In 2013, it found that less than 50 percent of the palm oil used by the companies it studied was certified.

Scott Poynton says the scorecards can be useful depending on the criteria used for ranking. He values the UCS scorecard, which he says is based on careful consideration of scientific fact, but says the WWF scorecard has no merit at all.

“WWF rank GreenPalm certificates as the equivalent of being certified, which is ridiculous and produces a completely nonsensical result that has the perverse effect of having people carry on business as usual, investing in GreenPalm and propping up an RSPO system. It’s ridiculous.

“If five percent of the oil you buy is segregated and RSPO certified and 95 percent is covered with a GreenPalm certificate, you will be ranked by WWF as having 100 percent sustainable palm oil, but you don’t know where 95 percent of that oil comes from. So you can’t know if it’s causing deforestation or if the workers producing it have slave-labour contracts?”

The UCS says Danone, General Mills, HJ Heinz, PepsiCo, and ConAgra Foods have committed to source certified, sustainable palm oil through the RSPO. “But they lack de­forestation- and peat-free commitments and have weak traceability or transparency commitments.”

In March this year, Colgate-Palmolive raised its score when it released its new palm oil sourcing policy. Sharon Smith from the UCS’s Tropical Forest & Climate Initiative welcomed the initiative: “It’s great to see that Colgate-Palmolive expects its palm oil suppliers to apply the company’s new policy across all parts of their operations. We’re thrilled with the comprehensive nature of this commitment.

“The one defect in Colgate-Palmolive’s plan is its timetable. The company plans to fully implement this commitment by 2020 – that’s six years of climate emissions from deforestation and peatland conversion as well as labour violations that the company will condone before they demand full compliance with the policy. While the commitment itself is looking good, Colgate-Palmolive should speed up the implementation timetable.”

Smith also welcomed the commitment made by the food production giant General Mills in March this year. General Mills operates in 100 countries and markets more than 100 consumer brands, including Cheerios, Yoplait, Häagen-Dazs, and Green Giant. The company pledged not to source palm oil from suppliers who develop peatlands, but Smith says the policy contains a major flaw.

“General Mills seems out of touch with the industry definition of HCS forests. The company claims there isn’t an industry methodology – an argument generally used to justify cutting down important forests – but in fact, there is an established method and General Mills needs to adopt it.”

The established method Smith refers to is the HCS toolkit developed by GAR, Greenpeace and TFT, which is currently being refined.

Smith adds that General Mills plans to implement its new policy by 2015. “That’s an appropriately ambitious timetable that will help accelerate a transition to cleaner palm oil production. This policy update is certainly an improvement for General Mills, but the company will need to follow through if it wants to demonstrate a true commitment to reducing deforestation.”

On the McDonald’s commitment, May-Tobin said: “While RSPO palm oil is better than business as usual, it still leaves a lot of forests and peatlands unprotected. Most companies making deforestation-free commitments are pledging to do so by 2015, so McDonald’s commitment isn’t just weak, it’s also five years late.

“McDonald’s was the target of a Greenpeace campaign a number of years ago about soy-driven deforestation in Brazil, so it is no stranger to the issue of tropical deforestation. But so far the company has seemed reluctant to go beyond the RSPO and address all palm-driven deforestation in their supply chain.”

Data and mapping

Access to data became easier in June this year, when the US-based World Resources Institute released online maps that show where all RSPO-certified palm oil concessions are located. The maps are hosted on the WRI’s new Global Forest Watch platform.

The maps encompass more than 1.6 million hectares of palm oil concessions in Indonesia, Malaysia, Cambodia, Papua New Guinea, and Brazil. The areas account for more than six million tonnes of annual palm oil production from 134 mills.

In another step forward – prompted by a resolution brought to the RSPO by the Sumatran Orangutan Society – all RSPO members are supposed to make publicly available for download a digital file that details the boundaries of their existing concessions. It remains to be seen how many of them will actually do this. “We have seen or heard nothing on this yet, and it’s now well past the 19 September 2014 deadline,” Dellatore said.

Indonesia is, meanwhile, working towards having just one map of all the palm oil concessions in the country, but there are currently several different versions. Until these baseline issues are resolved, says Shayne McGrath, companies will not be able to back up their sustainability pledges.

Ian Singleton says the availability of satellite imagery to pinpoint hotspots means companies can no longer go into denial, hoping their critics will go away. “We now have the data we need at our fingertips. We have never had so much power and ability to access information as we do now.”

Conservationists have even been able to use drones to obtain footage of the aftermath of the fires that ravaged the Tripa peatlands.

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Halting expansion

Panut Hadisiswoyo, who founded the Orangutan Information Centre in Medan, North Sumatra. says there cannot be sustainability in Indonesia while the government and corporations still allow the expansion of palm oil cultivation into the rainforests. They are focusing, he says, on short-term profit. “The government may talk about sustainability, but as long as the expansion continues, and they are not preventing it, they are not being serious.”

Hadisiswoyo mentions one palm oil company, which he declines to name, which is a member of the RSPO, but still wants to expand and now wants to move into Papua. “Sustainability doesn’t work when the forest is still suffering; when the expansion is still continuing.”

Little has been done at ground level to halt the expansion, Hadisiswoyo says. “I’ve talked to a lot of palm oil smallholders and they aren’t even aware of the terms ‘sustainability’ or ‘certification’. There are RSPO signs here, but a lot of people don’t know what it is.”

It’s not just the impact on wildlife that is disastrous, Hadisiswoyo says; the whole ecosystem is affected by deforestation. “This needs to be seriously addressed. It is up to the government to stop the expansion. There are even big companies with no-deforestation policies, companies that belong to the RSPO, that are still expanding.”

P1080375Burning of government-owned forest land in North Sumatra.

Hadisiswoyo says that, in Aceh, oil palm expansion is causing the destruction of wildlife habitat and farmland, landslides, and flash floods. “Local people are not gaining from this palm oil euphoria. There’s an impact on the microclimate, and this affects their crops. The river is brown and polluted and people have to buy water, even for washing.”

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In the village near to the forest restoration site run by the OIC in the Gunung Leuser National Park, locals have lost the land they used to use for paddy fields so now have to buy rice.

Hadisiswoyo says the government needs to look at the cost of using natural resources without proper planning, and the value of protecting the forest. “There are about four million hectares of palm oil already in Sumatra; that’s already enough. There is only 30 percent of primary forest left.”

One reason palm oil companies opt for forest land is they can make money on the timber they cut down to clear the area. “The companies obtain licences to develop an area of land, then they extract the timber,” Hadisiswoyo said. “In one year they are already at break-even point.”

Hurowitz says there are millions of hectares of land across the tropics that are available for planting without deforestation. “Several studies have shown that there are higher economic returns from planting those areas than forested lands, particularly peatlands.”

The reason companies clear forest land has much to do with corruption, Hurowitz says. “The palm oil companies have found it easier to bribe an official at the Ministry of Forestry or a local official to get a concession on national forest land than negotiate with local landowners.

“Much of the degraded land is controlled by local communities, Hurowitz says. “The palm oil’s business model is cheap land and cheap labour. They just don’t like to go through the trouble of these negotiations. Wilmar and GAR are showing, however, that it is possible to make big profits while confining planting to degraded land.”

Hadisiswoyo wants to see the palm oil market stabilise and says production needs to be maximised on land already allotted and there needs to be a focus on small-scale agro forestry that benefits local people.

In their book, ‘Palms of controversies: oil palm and development challenges’, Alain Rival from the French research centre CIRAD and Patrice Levang from the Center for International Forestry Research say there are several ways in which oil palm plantations can be developed without destroying vast stretches of tropical forests, and these include agro-forestry techniques, patchwork developments, and ecological planning.

Oil palm does not need to be planted on forest lands, Levang says. “You can plant oil palm on savannahs and on degraded lands. So oil palm per se is not responsible for deforestation.” The major take-home message in the book, Levang says, is “Don’t confuse the crop with the people who develop it”.

The writers say that, even if economically viable agro-forestry systems can be developed, they have very low biodiversity as compared with primary forest. “There is always the danger that local people will be induced to make more agricultural land out of the adjacent forest.”

Ecological planning is similar to patchwork development, but is more tightly organised. The objective is not to preserve the forest as a whole, but to limit the worst effects of conversion. Only part of the countryside is converted into plantations.

“Where necessary, agro-forest zones serve as buffers between conservation and plantation zones,” Rival and Levang write. “This model was recently tested in Malaysia and Indonesia by a few companies keen to improve their environment-friendly image.”

Implementation of ecological planning requires a degree of technical knowledge still rarely available in the companies active in the field. “It also entails a substantial additional outlay, which is by no means made up for by the benefits of certification,” said Rival and Levang.

The financial and legal incentives of ecological planning are still too low for most companies, the authors say.

“The market dominated by the emerging countries is more interested in cheap oil than ‘clean’ oil and the weak governance in most of the countries where the major companies are active tends not to respect legislation (when this exists at all).”

The authors say that, over the past few decades, Indonesia has seen the conversion of more than five million hectares of primary forest, Malaysia more than four million, and Nigeria one million.

“The conversion of primary forest into monospecific oil palm plantations is undoubtedly an ecological disaster. After the bulldozers have been through and the land has been burned, little is left of the biodiversity of fauna and flora, nor of the habitats of the innumerable species living in the forest.

“Orangutans, gibbons, tigers and elephants are often in the headlines, but the damage extends well beyond these few emblematic species.”

Rival and Levang say environmental NGOs are right to emphasise this negative aspect of oil palm expansion, but oil palm itself bears no responsibility for this. There has, they say, been a positive socio-economic impact. “The problem is not the oil palm, but the way people have chosen to exploit it. The palm tree is just the vehicle; the real problem is the conversion of the forest for agricultural use, particularly where this use takes the form of a monoculture.

“Be it oil palm, soybean, sunflower, rapeseed, sugar cane or Acacia mangium, the problem remains the same: the forest with its rich biodiversity is sacrificed.”

Hurowitz wants to see companies and governments helping to restore some of the forest that’s been lost. “Asian Pulp and Paper are committed to one million hectares of conservation and restoration and we hope that Wilmar and Cargill and GAR will join them in investing in forest restoration.”

P1080223Panut Hadisiswoyo at the OIC forest restoration site. Elephants are returning to the replanted areas, but often cause damage to the young trees and seedlings. The replanted land was reclaimed after being illegally planted with palm oil.

Increasing yield

Rival and Levang say palm oil producers could intensify production in zones that have already been converted into plantations rather than sacrifice more primary forests.

“Areas already planted with oil palms often fall well short of producing the yields of oil expected (3.7 tonnes per hectare as a global average while selected plant material used in trials produces more than 10 tonnes per hectare under optimum ecological conditions).”

“Despite its favourable agro-climatic conditions, Malaysia has an average national yield of less than four tonnes per hectare, which remains far below the top yields achieved in some plantations in the region (6–7 tonnes per hectare). Africa offers particularly dramatic margins for progress. In Cameroon, for example, the average yields of smallholder plantations are only a quarter of the average yield of Indonesian smallholders.”

Shayne McGrath also highlights the importance of productivity. “Four times the profit margin off the same amount of land means more forest can be saved. The companies could have long-term, sustainable businesses, and still have rivers flowing through the water catchments, providing irrigation for the plantations.”

Michelle Desilets also urges companies to increase yields. “There are growers in Indonesia who could quadruple their yield using the same land. But that of course costs money and access to technology and good seedlings, and smallholders may not have ready access to these.”

Dellatore sounds a warning note, however: “Without regulation and the concessions not being sold, I don’t think many business people are going to settle for more productivity with less land when they can also get even more productivity with even more land.”

The HCS approach

The signatories of the new palm oil manifesto will be funding research to define what constitutes a HCS forest and to establish HCS thresholds. Wilmar is also involved in financing the initiative.

“Further research to strengthen the HCS Approach is welcome,” Bustar Maitar said, “but allowing clearance in the name of sustainability is nothing less than greenwashing. To show they are serious about addressing deforestation, the group must immediately stop clearing potential HCS forests.”

Greenpeace, TFT, and Golden Agri-Resources worked together to develop the HCS Approach, which combines carbon and biodiversity conservation and takes into account community rights and livelihoods to determine which land can and cannot be developed.

“Tools for implementing no-deforestation are already being tested and starting to be implemented by the likes of Asia Pulp & Paper, Golden Agri-Resources, Cargill, and Wilmar,” Bustar said. “Companies who are serious about breaking their link with forest destruction will stop the bulldozers now, and work to strengthen this definition, rather than support a fringe initiative that has not gained credibility in the eyes of NGOs.”

RAN’s Bill Barclay says the manifesto signatories are proposing to redefine HCS forests so that they can continue to clear ecologically important areas of secondary forest.

At the start of 2014, when the sustainable palm oil manifesto was launched, Poynton was concerned and said Malaysian companies were engaged in “spin and mischief” over forest definitions and thresholds. Now, he says, the manifesto group is in dialogue with the HSC Approach group “and there is real hope that everyone can become aligned”.

New business models

The managing director in charge of sustainability policy at one of Indonesia’s biggest forestry companies has called for a new business model for managing forest in Indonesia. She was responding to the news that Indonesia had surpassed Brazil as the world’s top deforester.

In a letter published by the environmental website Mongabay, Aida Greenbury from Asia Pulp & Paper said deforestation needed to be recognised as an economic and social challenge, not just an issue of policing and control. “The private sector in Indonesia needs to be more proactive and to act with more urgency.

“The bigger picture, and my hope, is that the economic success of companies operating zero- deforestation businesses will demonstrate to others that it is possible to operate profitably without having a detrimental impact on the landscape.

“International consumer brands, the NGO community, and the wider business community have a key role to play in this, by supporting zero-deforestation businesses.”

By demonstrating that zero deforestation practices bring market reward, the wider business community can establish zero-deforestation as the new norm, Greenbury says.

At the recent Innova forum in London, Greenbury welcomed the New York declaration as an important initiative, but called for “delivery mechanisms, action plans, and independent verification”.

She said zero-deforestation commitments needed to be made now, not in 17 years’ time. In a recent article published in BusinessGreen, she wrote: “The time to act to save the world’s natural forest is now. Targets can be set and achieved by individual companies; we have shown this, and there simply isn’t any time to waste if we are to collectively save one of the world’s most precious natural resources.”

Also on Mongabay, conservation researcher and manager Gabriella Fredriksson said in an interview that Indonesia needed a system in which the annual funding allocated to individual districts by central government is partly based on their environmental performance.

She gave the example of districts whose boundary encompassed the upper parts of watersheds that provided water and prevented flooding for downstream districts. “They should get a specific annual budget allocation based on their performance in keeping that forest intact.”

Districts that had allowed peat areas to be burned and had caused excess carbon emissions should have their funds cut, Fredriksson said.

“Districts that have high biodiversity values that need to be conserved get higher budget allocations based on that. As money rules … I think this might very quickly lead to better forest conservation and environmental management in general.”

New law hampers conservation

A law passed recently by the Indonesian government is causing difficulties for at least one palm oil company that is trying to conserve forested land.

A report published by Greenomics in October this year shows how complex things have become. It focuses on the zero-deforestation policy established in 2011 by GAR, Indonesia’s largest palm oil producer.

The Greenomics study found that GAR was effectively protecting HCS areas in seven of its concessions in West Kalimantan, but said that its concession operated by PT BAT in Central Kalimantan was showing less signs of success, with several block of HCS forest apparently losing cover. “These blocks range from small to relatively large in area, and they are being opened up at an increasing rate.”

The report says GAR has succeeded in protecting most of the HCS forests on its palm oil concessions, “but there is no legal guarantee that such protection can be sustained in the long term”.

The lands that GAR has set aside for conservation are classified as “plantable” by the Indonesian government. Under revision to the Plantation Act in September 2014, any area under a Right of Cultivation permit must be fully cleared and converted for its intended purpose within six years of the licence being granted. Companies are required to cultivate at least 30 percent of the area within three years of getting the licence.

If the land isn’t cultivated, it can then be seized by the state and turned over to an entity that will convert the area. Any company in breach of the Act’s requirements is subject to administrative sanctions, including fines, the suspension of its commercial operations, and/or the revocation of its business licences.

Areas of land set aside for conservation could be given to companies that don’t have zero-deforestation commitments. According to the Greenomics report, such areas cannot be incorporated into the nationwide moratorium because the moratorium only applies to new forestry concessions, not existing ones.

However, if the opening up of HCS forests can be categorised as an activity that causes environmental damage, then the HCS forests set aside by palm oil companies could be conserved as part of the overall effort to prevent environmental damage. “The conservation of HCS forests must no longer be equated from the legal perspective with the neglect of land,” the report states.

Greenomics says the new Plantation Act has the potential to completely undermine efforts to maintain HCS forests over the long term. “The new Indonesian government has the opportunity, albeit not a straightforward one, to legally support the conservation of HCS forests in oil palm plantation concessions.”

Scott Poynton hopes the pledge made in New York and the involvement of the Indonesian Chamber of Commerce will help those pushing for a change in the abandoned land policy. “If this law can be changed, it will be a dramatic development. It has been a loose part of the puzzle for a long time. It’s holding back the charge forward.”

Indonesia had aimed to increase its palm oil output by a third to 40 million tonnes by 2020, but this goal seems unlikely to be reached after a new regulation was brought in that limits the size of certain plantations to 100,000 hectares.

The new law exempts state-owned firms, co-operatives, and listed firms in which small individual investors make up a majority stake, and will not affect companies that already have plantation permits.

Palm oil currently covers an estimated eight million hectares in the country.

 Court victories

There was a landmark court victory in January this year when Indonesia’s environment ministry took a palm oil company to court for illegal forest clearance in the Tripa peat forest, and won.

PT Kallista Alam was found guilty of illegally burning 1,605 hectares of Tripa, which lies within Sumatra’s Leuser Ecosystem – the only place on earth where tigers, elephants, rhinos, and orangutans can be found living together in the wild.

The judges ordered the company to pay 114.3 billion rupiah (nearly 9.4 million US$) in compensation and 251.7 billion rupiah (close to 20.8 million US$) to restore the 1,000 hectares of forest affected.

The Kallista Alam director and one of the company managers were also given jail terms for illegal forest clearance.

The court decisions were hailed as important steps forward in law enforcement, but the Kallista Alam case is a rare example of a company being brought to book and the damage already caused to one of the most precious ecosystems on the planet is disastrous.

It was the then governor of Aceh, Irwandi Yusuf, who gave the permit to Kallista Allam to cultivate palm oil on what should have been protected land.

Rawa Tripa-Verifikasi LapanganEnvironment ministry experts conduct field verification in Tripa.

Six other civil and criminal cases involving four other palm oil companies are still before the courts. “We are learning in Tripa,” Singleton said, “that illegal concessions and illegal activities can be challenged and defeated. But we’re a long way from sustainability.

“We are living in a world where soils are being destroyed much faster than they are being produced. We don’t need to be producing these monoculture crops for profit; it’s perfectly possible to produce biscuits and shampoo and all these things without palm oil.”

The victory in Aceh came after a large-scale international campaign and collaboration between all sectors of society. “We do see success when there is that level of connectivity and coordination,” said Shayne McGrath. “Collaboration is the key – and smart campaigning.”

Working together

Poynton also lays great store by discussion and collaboration. He doesn’t think such initiatives as better labelling makes much difference. Sharing perspectives and reaching a better understanding are what bring solutions, he says.

“Change has to come from inside the company. It has to come from inside the CEO’s soul. This is what happened at Wilmar, and it has transformed the industry.”

In a recent article, Poynton wrote about the growing unity between businesses and NGOs in tackling deforestation. “NGOs, now armed with new tools like Global Forest Watch and their own satellite data and ground checks, are sending more and more information through about issues that conflict with the new policies. Instead of resorting straightaway to front-page exposés, NGOs are now nudging businesses to address the concerns.”

As businesses move to address problems, they’re seeking input and support from their long-time adversaries, Poynton says. “Trust and collaboration, long absent, is emerging.”

One of TFT’s aims is to help strengthen the capacity of local NGOs to monitor company commitments. “They need more resources so we are trying to get the big companies to provide the money.”

TFT is now working with Wilmar to transform its entire supply base. “They have got about 500 different suppliers so it’s a massive project,” Poynton said.

Halting the continuing destruction will involve a great deal more consumer pressure, significant political will, true willingness throughout the industry to move rapidly towards true sustainability, and a consistent clampdown on corruption and illegal practice.

Both McGrath and Hadisiswoyo emphasise the importance of proper law enforcement and education. “The forest police need to be given the resources to do their job,” said McGrath.

Hadisiswoyo says it’s vital to keep informing local people about the importance of the forest.

“There is now almost zero encroachment around our forest restoration area. There are people who used to be illegal loggers who are now supporting our project. It is one of the success stories.”

Forest Heroes is working on several fronts. “With our allies,” Hurowitz said, “we are trying to get the other rogue traders to adopt their own no-deforestation principles. Musim Mas is another big trader in the 10-15 percent of global volume range that has yet to make a strong commitment to forest protection.

“Beyond that, we are working to leverage this progress into government action and to spread this revolution to Latin America and Africa. A forest doesn’t care if it is being cut down for soy or cattle or palm oil; the important thing is that it is being cut down. We really need to make sure that these companies start implementing their commitments for all these other commodities

It’s big Asian companies who have been driving deforestation in Africa, Hurowitz says. “It’s their frontier area for palm oil expansion and, if the Asian companies change, that could improve the prospects for Africa and forest protection dramatically.”

Hurowitz highlights the announcement made by Liberia at the recent climate summit in New York. “It said it will require any agricultural company operating in the country to adhere to Wilmar’s policy. This is our theory of change coming to fruition.”

 Losing biodiversity

In October this year, a study published in Nature Communications demonstrated the negative impact of palm oil cultivation on biodiversity. The researchers found that oil palm plantations are home to fewer insect species than even intensive rubber tree plantations.

Insects are important in ecosystems because they help recycle nutrients, and are a food source for other species. “Species diversity, density and biomass of invertebrate communities suffer at least 45 percent decreases from rainforest to oil palm,” the researchers said.

The loss of insects, they say, could be caused by the pesticides or insecticides applied in oil palm plantations or the differences in energy input (leaf litter and nutrients).

The researchers, who conducted their study in Sumatra, looked at what they call “annual energy fluxes” and demonstrated a 51 percent reduction when forest was converted to oil palm plantations. They were particularly concerned about the loss of predatory insects.

“Species loss clearly explains variation in energy fluxes; however, this relationship depends on land-use systems and functional feeding guilds, whereby predators are the most heavily affected.

“Biodiversity decline from forest to oil palm is thus accompanied by even stronger reductions in functionality, threatening to severely limit the functional resilience of communities to cope with future global changes.”

Greenpeace says the annual clearing of Indonesia’s peatlands releases some 1.8 billion tonnes of greenhouse gases and some put the figure at 2 billion.

According to research released by the RSPO last year, conversion of peatlands for oil palm plantations caused carbon dioxide emissions to increase from 26 million tonnes per year in the 1990s to 56 million tons between 2001-2005 and 88 million tons between 2006 and 2010.

Hadisiswoyo said: “As long as the industry demands expansion, the word sustainability has no sense. It is just a fantasy.”

P1080232Panut Hadisiswoyo at the OIC reforestation site in north Sumatra.

Breaking old links

There are those who say that even responsible palm oil production is impossible. It’s clear that, in an ideal world, monocultures would not exist. We would be reducing our consumption of unnecessary oil-rich products and putting the protection of our forests and wildlife before misguided profitability.

The reality, however, is that there are already more than 16 million hectares of palm oil planted in the world and the industry is estimated to be worth more than 60 billion US$. The demand for cheap oil is not going to disappear and the companies that are tapped into this demand will continue to seek to boost their production.

There are companies, like the Australian skin and hair care producer Sukin, that are aiming for sustainability without being pressured. However, it is outside persuasion that is prompting most palm oil producers and buyers to institute responsible policies.

“I wouldn’t underestimate the role of the campaigns in driving this change,” said Glenn Hurowitz.

“The companies themselves will tell you that they would not have made these huge changes without intense pressure from NGOs. Even in the implementation of these commitments there’s a lot of value in having independent NGO scrutiny on them.”

Companies like GAR do care about their public image and CEOs like Kuok Khoon Hong do seem committed to a collaborative future. More and more companies are realising that responsible business practice can have benefits for everyone, and at least some of the worst offenders are being brought to book.

There are awful abuses of human rights in oil palm plantations around the world, and places that may never recover from the environmental damage already caused, but a momentum is building that is bringing us closer to what may be a tipping point. The worst ravages of this industry may well be coming to an end.

“The palm oil industry still has huge problems,” Hurowitz said. “If deforestation were to increase again, I think you’d see markets around the world shift to other vegetable oils.

“These no-deforestation policies have bought the palm oil industry a window of opportunity to show that they’re serious about protecting forests. They need to deliver on that, though, and that is what is happening right now.

“And it’s not just about palm oil; it is about breaking the link between agriculture and deforestation around the world. It’s the second green revolution.”

To boycott or not to boycott

There is a very vocal lobby, mostly in Australia and Europe, that demands a total boycott of the world’s most popular edible oil, but most of those working in forest and wildlife conservation say this is not a viable option.

“The problem with a boycott is that the industry and consumers will want a substitute,” said Panut Hadisiswoyo, “and this may mean a sacrifice of the remaining forest.”

Calen May-Tobin, from the Union of Concerned Scientists, is one of the most ardent voices against a boycott. “The solution isn’t to boycott palm oil, but rather to demand that companies use and produce palm oil that is deforestation- and peat-free.”

The problem, May-Tobin says, isn’t with palm oil itself. The problems arise, when forests and peatlands are converted to plantations. “This leads to loss of habitat and millions of tonnes of carbon emissions.”

There are, May-Tobin argues, many positive things about oil palms. They are more productive and store more carbon than any other vegetable oil crop and the typical rotation for an oil palm plantation is 25 years. “To replace all palm oil on the global market with another oil would take up between five and eight times as much land.”

May-Tobin, who conducts research on palm-related deforestation and how to reduce the land-use carbon footprint of the palm oil industry, says a decrease in demand for palm oil from one company or country won’t mean an overall decrease in palm oil demand.

If customers in the US stopped buying palm oil, another oil would have to be imported to meet vegetable oil demand, he says, and this would be a vicious circle. “If the US bought more canola oil, another country would be buying less and would need to find another oil to meet its demand. It would most likely buy the cheapest vegetable oil on the market: palm oil.”

Desilets agrees that a boycott is not the answer. “Making no distinction between conventional and deforestation-free oil will not change how the oil is produced for the billions of people who consume it daily.”

Oil palm, Desilets says, can be grown sustainably in areas without forests or peat. “The World Resources Institute has demonstrated that there is more than sufficient land like this available, for example in Borneo, to meet the projected increased demand. In Borneo alone, some 14 million hectares of unforested land could be suitable for expansion, and this far exceeds the next fifty years’ production or expansion. There is also a lot of unforested land in peninsular Malaysia that could be used.”

“The argument that you must clear forest in order to expand and grow economically is wrong, especially in a place like Borneo.”

The WRI and SEKALA, an Indonesia-based consulting company that specializes in forest governance, have developed an online application called the Sustainability Mapper, which enables users to identify potentially suitable sites for sustainable palm oil production.
WRI suitability_mapper_2014

Users can replicate or customize the desktop portion of a method developed under the WRI’s Palm Oil Timber Carbon Offset (POTICO) project. Users can identify potentially suitable areas for sustainable palm oil in Indonesia, and identify priority sites for further investigation in the field.

The POTICO project aims – by organising land exchange – to redirect oil palm plantation projects originally planned for forests to 500,000 hectares of degraded land. The areas that were originally earmarked for oil palm plantations are to be conserved or exploited to produce Forest Stewardship Council certified wood. The project is now in a transition state as the WRI incorporates some of its older tools into Global Forest Watch.

POTICO_Infographic_1_Final_0

The WRI has also produced a Forest Cover Analyzer, with which users can assess forest cover change and the risks related to sustainable palm oil production in Kalimantan, Indonesia.

forest-cover-analyzer

Users can find the answers to three basic questions:

  • Where and when has forest cover change occurred?
  • What is the current extent of forest and peatland?
  • How is the area legally classified according to the Ministry of Forestry?

The WRI says the Indonesian government has made encouraging decisions. “It has voluntarily committed to a minimum 26 percent reduction in greenhouse gas emissions by 2020 and developed a strategy for land use and forestry emissions, extended a moratorium on new clearing of primary forests and peat lands from 2 to 4 years (2013-2015), and increasingly recognised the rights of forest communities and indigenous peoples.”

The country needs to balance its environmental and social goals, the WRI says. “Indonesia is the world’s third largest emitter of greenhouse gases, mainly due to the conversion of its forests and carbon-rich peatlands. These shifts in land use have ecological and social consequences, as Indonesia’s forests are home to thousands of plant and animal species, and 50-60 million Indonesians depend directly on the forests for their livelihoods.”

Desilets says that only by demanding that the palm oil used, especially in global brands, is deforestation-free will we start to see some benefit to forests and biodiversity. She believes that consumer pressure on Western buyers of palm oil can influence the growers and transform the market. The balance towards sustainability has finally started to tip, she says.

Maximum yields for oil palm are as much as twenty times greater than that of the maximum yield for soya, Desilets points out. If producers operating in tropical regions like Indonesia and Malaysia were compelled to switch to another oilseed crop, the deforestation could be twenty times more than it is with oil palm.

“If people boycott products containing palm oil, the company in question won’t see statistics showing exactly why that product was rejected. People need to go to manufacturers and retailers and ask questions about sourcing: where the palm oil comes from, whether it is CSPO, and whether it is deforestation- and conflict-free. If you are just not buying, the message doesn’t get to the right department.”

Dellatore would agree. He says that, even if it were possible, a boycott would be ineffective. It is, he says, a red herring that might make people feel better, but won’t change anything.

Poynton says he is no defender of palm oil, but it is not about to go away. “So we’d better work hard to promote the things that are good about it while dealing in a really practical and sensible way with the things that are causing the problems.

“Just saying no to palm oil is nonsensical. Even if no one in Europe ever buys palm oil again, the Chinese and the Indians need cheap food products.”

In their recent book, Alain Rival and Patrice Levang also say it makes little sense to boycott palm oil if, in replacing it, you convert eight times more forest into soybean and sunflower fields.

“This happens to be one of the favourite arguments of the palm oil industry: because yields of oil palm are eight times higher than those of soybean, we can reduce the surface area which needs to be deforested. But the argument is misleading – neither soybean nor oil palm require deforestation.”

Shayne McGrath also says a boycott is not a viable option, but adds that “at least a segment of the world market is definitely ready to receive palm oil that is truly traceable, and, over time, one would expect that market segment to increase”.

Palm oil is just a crop, McGrath says. “It’s not evil. Palm oil didn’t do anything. It’s humans and their agricultural practices that have created the problems that have tarnished the palm oil brand.”

Desilets says everyone has a part to play in ensuring sustainable solutions, not just the growers. “Everyone in the supply chain has a role, as do the governments, the financial institutions, and the consumers.”

Responsibly produced palm oil is possible, she says. “Indeed, it is imperative, given the growing global population that will continue to put more and more pressure on our planet.”

 

  1.  The ISPO is a mandatory national sustainability scheme introduced in 2011. It is based on Indonesian national laws and regulations. All palm oil companies and planters in Indonesia must comply with the ISPO rules by December 2014. Companies not in compliance by the deadline will have their plantation class downgraded. There are 98 indicators that elaborate seven sustainability principles and criteria. The Indonesian Palm Oil Council and the Indonesian Palm Oil Producers Association have called for the deadline to be extended. By the beginning of 2014, only forty palm oil companies had secured ISPO certification.

 

Article updated on 21/11/2014 and 29/11/2014.

 

Part 2 of this series of articles about sustainability will focus on the reforestation project run by the Orangutan Information Centre in Indonesia. Since 2005, the organisation has planted close to 1.5 million trees across northern Sumatra. Most of its work is carried out in the Gunung Leuser National Park in north Sumatra, where it is reforesting land that was illegally cleared for palm oil.

 

 

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