Roundtable on Sustainable Palm Oil

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The Roundtable on Sustainable Palm Oil (RSPO), created in April 2004, is an "association created by organisations carrying out their activities in and around the entire supply chain for palm oil to promote the growth and use of sustainable palm oil through co-operation within the supply chain and open dialogue with its stakeholders."

From an RSPO press release:

In the RSPO, oil palm growers, oil processors, food companies, retailers, NGOs and investors work together towards a global supply of palm oil that is produced in a socially and environmentally responsible way.

The Roundtable promotes palm oil production practices that help reduce deforestation, preserve biodiversity, and respect the livelihoods of rural communities in oil-producing countries. It ensures that no new primary forest or other high conservation value areas are sacrificed for palm oil plantations, that plantations apply accepted best practices and that the basic rights and living conditions of millions of plantation workers, smallholders and indigenous people are fully respected.

At present, more than 340 organizations subscribe to the Roundtable’s principles, representing about half of the world’s palm oil supply. Membership of the Roundtable is growing.

The first sustainable oil palm plantations were certified in 2008. In November 2009, the first shipment of RSPO-certified sustainable palm oil was delivered to ports in Europe. Among the first buyers were Unilever and Sainsbury's Supermarkets. Initial volumes of RSPO-certified palm oil will still be relatively small, but supply will gradually grow over the coming years so that sustainable palm oil can be used in a growing number of products. In due course, the Roundtable aims to see all the world’s palm oil produced in a sustainable way.

Contents 1 Information Provided by the Roundtable on Sustainable Palm Oil 1.1 About Palm Oil 1.1.1 Oil Palm 1.1.2 Highly efficient oil producers 1.1.3 Palm oil’s long supply chain 1.1.4 Palm oil applications 1.1.5 Palm oil exports support developing countries 1.2 The need for sustainable palm oil 1.2.1 Social side effects 1.2.2 Environmental side effects 1.2.3 Criteria defining sustainable palm oil production 1.3 The RSPO 1.3.1 History 1.3.2 Governance and membership 1.3.3 Independent auditors and certification bodies 1.3.4 World market coverage 1.4 Definitions of sustainable palm oil production 1.4.1 The principles 1.4.2 Social criteria 1.4.3 Environmental criteria 2 Resources 3 News

Information Provided by the Roundtable on Sustainable Palm Oil

Note: The following is reprinted from the RSPO Factsheet: Promoting The Growth And Use Of Sustainable Palm Oil

About Palm Oil

Oil Palm

Palm oil is an edible vegetable oil produced from the fruits of single-stemmed oil palms. The plants can grow 20 meters tall, with leaves up to 5 meters long. They bear clusters of fruit all year long with each fully matured cluster weighing up to 50 kilograms. The fruits contain about 50 percent oil.

Highly efficient oil producers

Oil palms are highly efficient producers of oil, requiring less land than any other oil-producing crop. One hectare planted with oil palm yields about three tonnes of oil per year on average, with the most efficient farms getting more than six tonnes out of a hectare. To produce that much oil from rapeseed (canola), sunflower or soy, up to ten times more land would be required.

Palm oil’s long supply chain

Oil palms are cultivated on large-scale plantations and on small-scale family farms. Smallholders in Indonesia and Malaysia manage about 3 million hectares, or 20 percent of the land used to produce oil.

After harvest, fruits are brought to mills where they are crushed and crude oil is collected. Part of the oil is traded locally; the rest is shipped to regions like China, Europe, India, Pakistan and Japan. There, the oil is refined before manufacturers apply it in all sorts of food and non-food products.

Palm oil applications

Because of its distinct properties, palm oil is perfectly suited for application in a wide range of food and non-food products. For example, palm oil is used to make shampoos, soap and other cosmetics more ‘creamy’. The oil can also be used as an ingredient to margarine, chocolate, ice cream and many other food products. In fact, palm oil is used in about half of all packaged food products in supermarkets today. More recently, palm oil has also been used to make fuels for transportation and power plants.

Palm oil exports support developing countries

Thanks to palm oil’s versatility, world production has grown steadily in recent years. Last year, palm oil accounted for a third of the 130 million tonnes of vegetable oil produced worldwide. Palm oil has recently surpassed soy oil as the world’s most popular vegetable oil.

Malaysia and Indonesia together produce about 85 percent of the world’s palm oil; they are also by far the biggest exporters. Other exporters include Nigeria, Thailand, Colombia, Ecuador, Papua New Guinea, Ivory Coast and Brazil. All are developing countries where palm oil trade has the potential to contribute significantly to local economic growth and poverty reduction. Palm oil production employs and supports more than seven million plantation workers, smallholders and their families.

Of the estimated 29.4 million tonnes of palm oil exported in 2007, 56 percent went to Asia, 16 percent went to the European Union, and 12 percent went to Africa.

The need for sustainable palm oil

Oil palms are highly efficient producers of high-quality, versatile oils. However, they only grow in the tropics, where their cultivation can have negative side effects for local populations or the environment. There is growing demand for palm oil that has been certified by independent auditors to have been produced in a sustainable way.

Social side effects

Among the social side effects of oil palm cultivation have been displacements of communities that used to farm or live in the area and whose legal or customary rights to the land became sources for dispute. Also, there have been reports of plantations that violated the rights of workers, including those to fair payment, safe working conditions or the freedom to unionize.

Environmental side effects

Growing production of palm oil has in some cases led to oil palm cultivation on land that was previously covered with peat-swamp forests, primary forests or other high conservation value areas. Such areas, already under pressure from other factors such as logging, are highly valued for their biodiversity and their capacity to sequester carbon dioxide.

Forest parcels are sometimes cleared by fires, which can burn out of control. The building of roads through forests has been blamed for hindering the migration of endangered species and exposing them to human activities.

Criteria defining sustainable palm oil production

In 2003, many of the world’s biggest palm oil producers and processors, together with retailers and leading environmental and social NGOs such as WWF and Oxfam International, came together in the Roundtable on Sustainable Palm Oil. According to the Roundtable’s definition, sustainable palm oil production comprises ‘environmentally appropriate, socially beneficial, legal and economically viable’ operations.

The Roundtable has drawn up general principles, criteria and specific indicators to measure the sustainability of palm oil production at plantations and mills. They include standards on dealing fairly with employees, small farmers and impacted communities, on expanding production without clearing new pieces of primary forest or other high conservation value areas, and on actively conserving natural resources and biodiversity.

The RSPO

The Roundtable on Sustainable Palm Oil (RSPO) is a multistakeholder initiative dedicated to promoting sustainable production of palm oil worldwide. The Roundtable’s more than 340 members include palm growers, oil processors, traders, consumer good manufacturers, retailers, investors and social and environmental NGOs. Through co-operation and open dialogue, they work to put on the market sustainably produced palm oil and to maximize its use.

History

The journey of the RSPO started in 2003 as an informal co-operation among Aarhus United UK Ltd, WWF, Golden Hope Plantations Berhad, Migros, the Malaysian Palm Oil Association, Sainsbury’s and Unilever. In 2004, the RSPO legally registered in Switzerland and set up offices in Kuala Lumpur (Malaysia) and Jakarta (Indonesia).

Between 2004 and 2008, important milestones were passed. The Roundtable developed a code of conduct and principles and criteria for sustainable palm oil production.

It also devised systems to certify whether palm oil is produced and shipped according to the criteria. The first shipments of RSPO-certified sustainable palm oil arrived in Europe by the end of 2008. Initial volumes are relatively small, and it will take some years before sustainable palm oil will find its way to most consumer products.

The Roundtable itself is a work in progress, created to promote the growth and use of sustainable palm oil. The Roundtable ultimately aims to see all the world’s palm oil produced in a sustainable way.

Governance and membership

Members of the RSPO subscribe to its mission and principles, adhere to its code of conduct, and together set the organization’s course. The Roundtable recognizes seven membership categories, which are all represented in its Executive Board. Membership has grown dramatically. In August 2008, the RSPO had 249 ordinary members:

• 67 Oil palm growers;
• 96 Palm oil processors and/or traders;
• 5 Social/developmental NGOs;
• 13 Environmental/nature conservation NGOs;
• 36 Consumer goods manufacturers;
• 24 Retailers;
• 8 Banks and investors.

Also, 92 organizations had registered as affiliate members. A full and up-to-date listing of Roundtable members can be found at www.rspo.org.

Independent auditors and certification bodies

While the Roundtable sets the principles, criteria and indicators that define sustainable palm oil production, the actual auditing and certification of palm oil plantations and the supply chain is carried out by independent certification bodies approved by the RSPO. The certification systems are described in more detail in seperate technical fact sheets.

World market coverage

About 40 million tonnes of palm oil are produced worldwide. Roundtable members represent about half of that volume, so the RSPO’s efforts will potentially have a large impact. While in due course the RSPO aims to see all palm oil certified, initial volumes of sustainable palm oil will be relatively small.

By the end of 2008, RSPO-certified production capacity is projected to be about 1.5 million tonnes per year, about 4 percent of world production capacity; one year later, at least double that capacity can be expected.

Definitions of sustainable palm oil production

The Roundtable principles for sustainable palm oil production ensure that fundamental rights of previous land owners, local communities, workers and their families are respected and fully taken into account. The principles also ensure that no primary forests or other high conservation value areas have been cleared for oil production since November 2005, and that mills and plantation owners minimize their environmental footprint.

The Roundtable has defined 8 principles and 39 criteria to define sustainable production of palm oil. A full listing of principles, criteria and indicators is given in Principles and Criteria for Sustainable Palm Oil, a document that can be found under ‘Key documents’ at the Roundtable’s website (www.rspo.org).

The principles

• Commitment to transparency
• Compliance with applicable laws and regulations
• Commitment to long-term economic and financial viability
• Use of appropriate best practices by growers and millers
• Environmental responsibility and conservation of natural resources and biodiversity
• Responsible consideration of employees, smallholders and other individuals and communities affected by growers and mills
• Responsible development of new plantings
• Commitment to continuous improvement in key areas of activity

Social criteria

The social criteria are directed at strengthening local poor people’s livelihoods by preventing conflicts about the rights to use land, providing income security, protecting their health and living environment, respecting human and labor rights, and supporting legal compliance. Important examples of social criteria are:

• The right to use the land can be demonstrated, and is not legitimately contested by local communities with demonstrable rights. Use of the land does not diminish legal or customary rights of other users without their free, prior and informed consent.
• Pay and conditions for employees and for employees of contractors meet legal or industry minimum standards and are sufficient to provide decent living wages.
• The employer respects the right of all personnel to form and join trade unions and to bargain collectively. Where laws restrict such rights, the employer facilitates other ways of independent and free association and bargaining.
• An occupational health and safety plan is effectively communicated and implemented. The use of pesticides may not endanger people’s health or the environment. In general, pesticides are only used if there’s a real threat.
• Children are not employed or exploited. Work by children is acceptable only on family farms, under adult supervision, and when not interfering with education. Children are never exposed to hazardous working conditions.
• Smallholders are paid and treated fairly by oil mills.

Environmental criteria

The environmental criteria are directed at preventing further loss to primary forests or other high conservation value areas, reducing negative impacts on soil, habitats of endangered species and overall biodiversity, and development of water and energy efficient production methods. Important examples of environmental criteria are:

• New plantings since November 2005 have not replaced primary forest or any area required to maintain or enhance one or more ‘high conservation values’.
• Practices minimize and control erosion and degradation of soils.
• The conservation of rare, threatened or endangered species and high conservation value habitats are taken into account.
• Plantations and mills implement and monitor plans to reduce pollution and emissions from greenhouse gases. Waste is reduced, recycled, re-used and disposed of in an environmentally and socially responsible manner.
• Use of fire for waste disposal or for land preparation is avoided except in some very specific situations.

Resources

• Documents: "Principles and Criteria for sustainable Palm Oil Production (PDF File)" - November 2005

• Website: http://www.rspo.org

News

2009

• Success of Palm Oil Brings Plantations Under Pressure to Preserve Habitats , 17 September 2009 by New York Times: Each year, the oil palm plantations in Indonesia and Malaysia "produce millions of tons of palm oil, which has soared in popularity since the 1970s and is now found in foods like margarine, potato chips and chocolate, as well as in soap, cosmetics and biofuel."
  • "But the palm plantations are in the cross hairs of consumer groups and corporations in Australia, New Zealand, Europe and the United States. Echoing the longstanding concerns of environmental groups, they say palm oil producers continue to fell large tracts of forest to make way for plantations, destroying habitat for endangered species like the orangutan."
  • "The increasingly vocal protests are not what the industry expected five years after it began developing a certification system for producing environmentally sustainable palm oil. In 2004, the Roundtable on Sustainable Palm Oil was formed, representing palm oil producers; consumer goods manufacturers including Unilever, Johnson & Johnson and Kellogg; environmental groups like the World Wide Fund for Nature; and social and development organizations."
  • "The roundtable requires plantations to develop plans to protect rare or endangered species on their land and to assess whether there are cultural relics that need to be preserved."[1]

• Controversial palm-oil plan may save the orang-utan, 22 July 2009 by New Scientist: Orang-utan "researchers and conservationists in Sabah, in Malaysian Borneo, may have to do what had until recently been unthinkable: join forces with the palm oil industry whose plantations have eaten into much of the orang-utan's habitat. October this year will see an unprecedented meeting of Malaysia's palm oil producers, conservationists and local government to figure out how to protect the world's last orang-utans."
  • "Such collaborations will be especially important given the poor start for the international Roundtable on Sustainable Palm Oil (RSPO), set up in 2002, which is supposed to address the issues of environmental damage and wildlife conflict by encouraging producers to ensure their plantations are certified as sustainable."
  • "The conservation group WWF wants palm oil to be 100 per cent sustainable by 2015, but the initial results have been dispiriting. A WWF report released in May showed that just 1 per cent of the 1.3 million tonnes of sustainable palm oil produced since November 2008 had been sold - in part because it is more expensive."[2]

• Sustainable palm oil gets boost in China, 14 July 2009 by WWF: "Major China-based producers and users of palm oil have announced they intend to provide more support for sustainable palm oil, an important boost for efforts to halt tropical deforestation."
  • "The public statement, made at the 2nd International Oil and Fats Summit in Beijing on July 9, committed the companies to 'support the promotion, procurement and use of sustainable palm oil in China,' as well as 'support the production of sustainable palm oil through any investments in producing countries.'"
  • "China is currently the world's largest importer of palm oil, accounting for one third of all global trade. Increasing demand for palm oil, which is used in everything from soap to chocolate bars, is causing considerable damage to fragile rainforest environments, threatening endangered species like tigers, and contributing to global climate change."
  • "Palm oil producers and buyers making the statement included Wilmar International, IOI Corperation, KLK Berhad, Kulim Malaysia Berhad, Asia Agri., Premier Foods PLC and Unilever PLC. Oxfam International, TransAsia Lawyers, and Solidaridad China were signatories."[3]

• Significant rise in RSPO-certified palm oil in EU, 26 June 2009 by Commodity Online: "The volume of RSPO-certified sustainable palm oil imported in European Union markets have increased significantly as producers in South East Asia comply with the Roundtable on Sustainable Palm Oil, the multi-stakeholder association working to make all palm oil production sustainable. The equivalent of more than one third of all palm oil imported into the EU could now be sold as ‘sustainable’..."
  • "RSPO rules and audits on the ground guarantee that social and environmental standards were met during the production of certified sustainable palm oil. For example, producers need to protect the habitats of endangered species and no new primary forests can be cut for oil palm plantations. The rights of local communities, smallholders and workers have to be respected as well..."

• CPO Producers Say Green Efforts Not Paying Off, 31 May 2009 by JakartaGlobe: "While many palm oil plantations and farmers are struggling to get certificates proving their palm oil is produced in a sustainable manner, others that have the certificates are complaining that buyers in Europe don’t want to buy their products because they are too expensive."
  • "When the first batch of RSPO-certified palm oil arrived in Europe in November 2008, the company involved, Malaysia-based United Plantations, was accused by environmental organizations Greenpeace and Wetlands International of not actually meeting the RSPO’s requirements...Greenpeace maintains that the roundtable’s system fails to adequately address issues like deforestation, peatland clearance and other land-related conflicts."
  • "The EU is in the process of requiring all palm oil producers to certify both crude palm oil and derivative products. Companies that do not obtain certification by 2010 will not be allowed to sell to EU countries."

• "Green" palm planters struggling to find buyers, 30 May 2009 by Alibaba.com: "JAKARTA, May 27 - Palm oil planters in the world's top two producers Indonesia and Malaysia are struggling to find buyers for their eco-friendly palm oil...threatening to slow momentum."
  • "Under fire from green groups and some Western consumers, the palm oil industry established the Roundtable on Sustainable Palm Oil (RSPO) in 2004 to develop an ethical certification system that includes commitments to preserve rainforests and wildlife."
  • "...the industry had so far sold only 15,000 tonnes of certified green palm oil since the first shipment last November while output might have reached around 600,000 tonnes."
  • "The issue of 'green' palm remains contentious and some conservation groups argue that the current voluntary rules are not effective in protecting the environment."

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