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As commodities go, it’s fair to say that palm oil has an image problem. The industry continues to cause deforestation, biodiversity loss and human rights issues, particularly in Malaysia and Indonesia, where most of the crops are grown. But could a new approach by the Roundtable on Sustainable Palm Oil (RSPO) change that?
The RSPO standard includes rules to prevent environmental damage such as the clearing of ecologically valuable forest areas for palm oil cultivation, to reduce the use of chemicals, for responsible waste management, and to improve human rights and worker conditions.
In the conventional certification process, it is the palm oil mill and its supply base that are certified. In the jurisdictional approach, certification of the production and processing of palm oil products is scaled up to the jurisdictional level, and supported by government policies and laws that are consistent with the RSPO standard.
The jurisdictional approach is agreed through a multi-stakeholder process, which includes government, growers, communities and non-governmental organisations. The idea is to overcome some of the limitations of the conventional approach in terms of improving or removing the environmental and social impacts of palm oil.
Dr Jen Lucey from the University of Oxford’s Smith School of Enterprise and Environment led a research project on the impacts of RSPO palm oil certification on livelihoods and biodiversity. She believes the jurisdictional approach can address problems that are difficult to tackle at the level of an individual plantation.
She says: “So many environmental impacts happen at much larger scales than just the plantation – you can do your best to protect orangutans by setting aside land on your plantation, but it won’t support an orangutan population if deforestation is going on all around you.”
There are also logistical considerations, for example with responsible waste management and chemical disposal, for which there are strict requirements under RSPO certification, but infrastructure is often lacking. Having a whole jurisdiction involved makes it much easier to make sure the right facilities are in place, she says.
Francisco Naranjo, RSPO technical director, says there are benefits for smallholder farmers too, who grow around 40% of palm oil globally. “Having the government on board is extremely beneficial, because there are some gaps in the legal framework that only they can fix,” he says.
He cites the example of the need for smallholders to prove legal ownership of the land they are growing on, which is a requirement of certification, but is difficult to obtain in some countries.
The RSPO is trialling the jurisdictional approach in Sabah, a state in Malaysian Borneo; the district of Seruyan, Kalimantan, in Indonesia, at the sub-national level; and Ecuador at the national level. Edo State in Nigeria and the Thai province of Surat Thani are considering participating.
The RSPO is developing a specific certification system document for jurisdictions, says Naranjo. It is managing the trials, encouraging them to share learning throughout the process.
Progress with the trials has been slow. In 2023, Sabah put regulations in place to support state-wide certification, the first of three steps. Ecuador achieved the first step at the end of 2024, having begun the process in 2016.
This is one drawback of the approach, and is inherent in having so many actors involved across a whole jurisdiction, according to Lucey. “They will all have different motivations, requirements and commitments to the cause, and competing political, economic and social needs. What’s better at a jurisdictional level is not necessarily better for the individual or the local level,” she notes.
Speaking on a panel at the RSPO’s annual conference in November, Ruth Salvador, manager of the North Amazon landscape for Conservation International (CI), which is leading on the Ecuadorian trial, said that involving a whole group of stakeholders was slow, but should be more effective in the long term.
She says: “There have been a lot of lessons learned. But I believe that steps two and three will be much quicker – we have our boots on the ground now. Having the government at the same table as the private sector and organisations such as CI and WWF, and aligning the local vision with international standards, is unique.”
The RSPO pilot is being tied to national targets, such as to reduce greenhouse gas emissions by 20%-25% by 2030. The CI trial has negotiated with local mills that buy from small producers of palm oil to pay a price premium to support them to achieve RSPO certification. It has also obtained agreement from local governments to encourage sustainable agricultural production, she says.
“This educates producers that there is a business piece behind switching production to be deforestation-free,” she says. The first group of producers in the country have now been certified to the RSPO’s standard, she adds. But to achieve scale, policymakers need to introduce financial incentives that allow growers to see economic changes in the longer term.
Panellists agreed that buyers and brands also have a responsibility to ensure that smallholders are adequately compensated for the extra work involved in becoming certified. Sander van den Ende, group director of sustainability at palm oil producer SIPEF, said that it was better in the long run for brands to buy physical bunches of palm oil rather than just certified credits, so that premiums could be passed on to smallholders.
Another thorny issue for the jurisdictional approach is how to ensure that an entire landscape is rigorously audited, given the actors’ different levels of compliance and capacity to comply.
To achieve step two of the jurisdictional approach, trials must establish internal control systems setting out how the jurisdiction will monitor and manage all the palm oil growers and mills, which will be verified by the RSPO, including checking that the jurisdiction has enough manpower.
A jurisdictional certification will be similar to those covering large groups of smallholders, Naranjo says. The RSPO has experience in certifying such bodies, such as one in Africa that has 5,000 members. “It’s not easy, but something we need to ensure that the internal control system is strong enough to be able to make claims to the market with confidence,” he adds.
In Sabah, those involved in the RSPO’s trial have set up working groups to develop internal control systems for all the issues covered by RSPO certification. “We need to start small, and work that up to a bigger scale,” said Nazlan Mohamad, sustainability manager at Sawit Kinabalu Group, the Malaysian government’s palm oil investment arm.
It is too early to judge whether the jurisdictional approach will be able to solve sustainability issues faced by conventional certification. Analysis of the Sabah pilot published in 2023 in the Journal of Environmental Management found that, despite differences in opinion from stakeholders over many aspects, most agreed that it would not achieve zero deforestation.
However, stopping the conversion of areas designated as high conservation value, high biodiversity and peatlands was deemed more achievable, and stakeholders felt that the approach could help protect the habitats of native biodiversity and ecosystem services. They also agreed that human wellbeing and plantation workers’ welfare would be improved.
The study also raised questions about a jurisdictional approach for a single commodity. Cross-commodity deforestation would continue and so some concerned palm oil buyers might source less from Sabah because of other less-scrutinised commodities causing deforestation in the state.
A net-zero deforestation territory beyond a specific commodity chain might be more appropriate, it said. To achieve this, buyer countries should help states such as Sabah make sustainable commodities part of their agenda.
Catherine Early is a freelance journalist
