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Sustainable palm oil: Marketing ploy or true commitment? New research examines RSPO standards

MEDAN, INDONESIA (7 November, 2013)Members of the Roundtable on Sustainable Palm Oil (RSPO) are violating the rights of indigenous peoples and local communities in the forests and peatlands of tropical nations worldwide, according to a new research publication released today. The study details the performance of 16 oil palm operations, many run by RSPO members, reporting on their failure to uphold human rights and environmental standards required.

"Since its founding eight years ago, the RSPO has adopted good standards, but too many member companies are not delivering on these paper promises," said Norman Jiwan, Executive Director of Transformasi Untuk Keadilan Indonesia, a human rights organisation based in Jakarta. "The RSPO could still meet this challenge if it provides remedies for member companies' impacts on communities, but for that we need much stricter enforcement. The organisation's very credibility is at stake."

The book, Conflict or consent? The oil palm sector at a crossroads, details cases in which palm oil producers have failed to obtain permission from communitiesa process required by the RSPO based on the UN mandate that is known as free, prior and informed consent (FPIC). The findings also support accounts of the destructive impact that the palm oil developments are having on indigenous peoples and local communities.

Advocates plan to circulate this research at the annual meeting of the RSPO, which takes place on 11-14 November in Medan, North Sumatra. Their outreach focuses on three themes:

  • Supply chainsthe journey of palm oil from the plantation to the processing plant to the consumer must be made transparent and fully traceable.

  • Enforcementthe mandate and capacity of the RSPO approved certification bodies must be expanded and enforced. Complaint procedures and conflict resolution mechanisms must also be given teeth.

  • Commitmentthe pledges by the RSPO">Forest Peoples Programme, an international human rights organisation. "In their rush to encourage investment and exports, governments are trampling their own citizens' rights. Global investors, retailers, manufacturers and traders must insist on dealing in conflict-free palm oil, and national governments must up their game and respect communities' rights."

    Indonesia Leads in Both Palm Oil Production and Deforestation

    Southeast Asia is the epicentre of the palm oil industry. Indonesia, where the RSPO meeting will take place, is the world's largest producer and exporter of palm oil, with 10.8 million hectares of land planted with oil palm trees, a number projected to expand to more than 20 million hectaresmore than 10 percent of the entire countryby 2020. Indonesia also ranks third in the world for carbon dioxide emissions, primarily because of deforestation and destruction of the nation's peatlands.

    Many of the Indonesian plantations, along with processing plants and other facilities in the palm oil supply chain, are based in Sumatra, making Medan the unofficial capital of Indonesia's palm oil industry. The city is bracing for street theatre and protests during the RSPO meeting.

    Forest Peoples Programme, Sawit Watch and Transformasi Untuk Keadilan Indonesia produced the investigative study in collaboration with 17 international, national and grassroots partner organisations and supporters in the major palm-oil producing countries: Indonesia, Malaysia, the Philippines, Thailand, Cameroon and the Democratic Republic of Congo.

    Free, Prior, and Informed Consent: Unimplemented and Under-enforced

    The 16 case studies in the research reveal that the RSPO process has at times led to an improved understanding of the key issues, both for communities and companies, in achieving 'sustainable development' based on respect for fundamental human rights. Some of the procedural improvements may provide a basis for resolving land conflicts, and several companies have responded positively and adjusted their operations to better accommodate community livelihoods and demands.

    But many more RSPO companies are running highly abbreviated processes to secure community consent, which are far from being 'free', 'prior' and 'informed.' In the concession of PT Permata Hijau Pasaman I, a subsidiary company of Singapore-based multinational company Wilmar International, in West Sumatra, Indonesia, the process of land acquisition was characterised by selective consultation between the company and co-opted community representatives. In the case of Tanjung Bahagia Sdn Bhd, a subsidiary of Genting Plantations, lands and forests have been cleared and planted despite sustained objections from the communities.

    Many companies are also failing to follow the RSPO procedures by not taking the requisite steps to recognise customary rights. In West Kalimantan, Indonesia, there has been collusive manipulation of the concept of customary rights by personnel from PT Agrowiratama, a subsidiary of the Indonesian Musim Mas group, in favour of local elites over local Melayu land-user communities. In East Kalimantan, Indonesia, PT Rea Kaltim Plantations, owned by British company REA Holdings PLC, did not undertake participatory mapping or land tenure surveys before acquiring land. This has now been recognised by the company, however, and mapping has begun.

    Lack of Enforcement Triggers Conflicts and Withdrawal from the RSPO

    The trampling of rights often spurs uneven conflicts, where protests from local communities are met with arrests and physical assaults. SG Sustainable Oils Cameroon PLC in South West Cameroon, owned by American company Herakles Farms, actually withdrew its membership of the RSPO in September 2012 in reaction to a formal complaint lodged against it and widespread criticism of its project. In PT Permata Hijau Pasaman I, conflict between the company and local communities has led to various arrests and an on-going court case at the Supreme Court of the Republic of Indonesia.

    The studies also show that existing conflict resolution mechanisms, including those of the RSPO, have yet to produce tangible results for local communities. Both the International Finance Corporation (IFC) Compliance Advisor/Ombudsman (IFC CAO) and RSPO conflict resolution processes, despite having established some important precedents, lack both the mandate and the capacity to remedy the huge number of disputes between companies and communities.

    Lack of company goodwill and transparency further hinder the effectiveness of the IFC CAO mechanism. In PT Asiatic Persada (PT AP) in Jambi, for instance, the company bulldozed the dwellings of community objectors into nearby creeks. IFC CAO mediation was initiated in 2012 but has come to a standstill due to the sale of PT AP by Wilmar without any due consultation with community members engaged in the mediation process. Wilmar effectively washed its hands of the concession and the problems it created.

    "The RSPO only works if the commitments its members make are genuine," concluded Marcus Colchester of Forest Peoples Programme. "RSPO certification was not meant to be a marketing ploy. It was meant to represent a wholehearted dedication to respecting the lives and livelihoods of indigenous peoples and local communities, and the lands that they call home. As an RSPO member, we are calling on the RSPO as a whole to reassert this commitment and live up to it."


Contact: Dan Klotz
Burness Communications

Gemma Humphrys
Forest Peoples Programme

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