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New standard aims to raise bar for ethical palm oil, boost demand

by Megan Rowling | @meganrowling | Thomson Reuters Foundation
Thursday, 11 February 2016 14:54 GMT

A worker unloads palm fruit at a palm oil plantation in Peat Jaya, Jambi province on the Indonesian island of Sumatra September 15, 2015. REUTERS/Wahyu Putro A/Antara Foto

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It aims to unify business efforts to stop deforestation and respect local people's rights when developing plantations

By Megan Rowling

BARCELONA, Feb 11 (Thomson Reuters Foundation) - A new, stricter standard for sustainable palm oil aims to unify business efforts to stop deforestation and respect local people's rights when developing plantations, while boosting consumer demand for the product.

The Roundtable on Sustainable Palm Oil (RSPO) this week launched "RSPO NEXT", a voluntary add-on to its existing criteria for sustainably grown palm oil, catering for growers, traders and buyers that want to go the extra mile.

The RSPO said the new standard was created in response to demand from member companies that have already promised to make their supply chains greener and more ethical, but have had to monitor their own progress so far.

"If you bring that into the RSPO, you get that credibility of a third-party system of assurance, and you manage to link up the whole of the supply chain," said Danielle Morley, RSPO's European director of outreach and engagement.

Certified sustainable palm oil accounts for around a fifth of global production of the cheap edible oil, which comes from fruits grown mainly on plantations in Asia, West Africa and Latin America.

Palm oil is used in a host of everyday goods, from soap to breakfast cereals, as well as for frying and fuel.

The policies demanded by the new standard include bans on cutting down forests and planting on peatland, allowing plantations to be developed only in areas where vegetation and soil contain low stocks of carbon.

To qualify, palm oil growers must also monitor and reduce planet-warming emissions across their entire operations. And they need to have plans and procedures in place to prevent and fight fires both on plantations and around their estates.

On human rights, growers will have to agree terms for a living wage with their workers, and help small-scale producers develop green business skills.

Consumer goods giant Unilever said the new standard would integrate the RSPO's best practices with the high ambition shown by leading companies working towards stronger commitments on "no deforestation" and responsible plantation development.

The advanced certification could play "a significant role in the critical next stage of the journey to eliminating deforestation in the extended supply chains by 2020 and the broader goals as set out in the New York Declaration on Forests - to halve deforestation by 2020 and end it by 2030", Unilever added in an emailed comment.


The RSPO's Morley noted that the new standard would not establish a separate physical supply chain, but palm oil buyers would participate by buying RSPO NEXT credits from verified growers, likely to be available from the third quarter of 2016.

Only companies that are already buying 100 percent certified sustainable palm oil will be able to purchase the NEXT credits.

Carl Bek-Nielsen, chief executive director of oil palm grower United Plantations Berhad, said this stipulation was key because it should help expand demand for certified palm oil - which lags behind supply.

Today only around half the world's sustainable palm oil supply is sold as such, with the rest sold as ordinary, uncertified oil.

"The growers in the past were actually taking a leap of faith and jumped into the RSPO voluntarily, trying to provide the consumers - the end users - with palm oil that could be certified as sustainable. The problem is that the uptake of sustainable palm oil is so poor," Bek-Nielsen said from Malaysia, home to most of the company's production.

"It sends a dreadful message to the growers," he added. "Why should we bend over backwards and make a triple somersault when no one wants to pay for this performance?"

Bek-Nielsen described the price premium for sustainable palm oil as "peanuts", and urged consumers to pay a little more for ethically produced oil, providing a carrot for growers to raise their standards.


Besides boosting demand, there are hopes that RSPO NEXT will increase transparency in the supply chain.

In November, RSPO members - who include investors and campaign groups - supported a resolution to improve the quality, oversight and credibility of assessments by outside auditors.

The move came after a report from the London-based Environmental Investigation Agency and Malaysian NGO Grassroots exposed flaws in the certification process.

To obtain RSPO NEXT verification, palm oil will have to be traceable to the plantation where it was produced.

Paul Wolvekamp, deputy director of environmental justice NGO Both ENDS and an RSPO board member, said it would also encourage more active communication with local people affected by plantation development.

The RSPO NEXT standard would help efforts to resolve auditing problems, but would not offer "a panacea", he told a web discussion this week.

Liza Murphy, an ethical certification consultant who coordinates the RSPO NEXT working group, told the Thomson Reuters Foundation auditors would be trained in monitoring the new standard in April.

As it rolls out, RSPO NEXT may need to be fine-tuned to make it more practical to implement on the ground, she said.

It will be an opportunity for companies - and the RSPO - to learn more about what is viable and has impact in making certified palm oil more sustainable before the next full update of the RSPO's criteria in 2018, she added.

"This will allow us... collectively to learn that some of the things that maybe five years ago would have been very hard to do are perhaps no longer as hard to do," she said.

(Reporting by Megan Rowling, editing by Tim Pearce. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers humanitarian news, women's rights, trafficking, corruption and climate change. Visit

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