Reports indicate that, by November, the Roundtable for Sustainable Palm Oil (RSPO) is set to release revised Principles and Criteria (P&C) for the production of sustainable palm oil. This will bring new standards into force.
At the same time, the European Parliament is pushing for the creation of a ‘Eurocentric sustainable palm oil standard’. This is beginning to encroach on the standardisation work of the RSPO and of the two biggest palm oil producing countries.
In addition to its P&C on the production of sustainable palm oil, the RSPO develops and maintains a number of documents and standards. They include those relating to the supply chain, internal and external certification systems and processes, and other relevant guidance for its members. On June 14, 2017, the RSPO Board of Governors (BoG) approved revised versions of such documents. These in part help set the foundation for the upcoming P&C.
On July 4, 2017, the RSPO Secretariat published the revised Certification Systems for P&C. The document entered into effect on July 1, 2017, but all members and certification bodies have been given 12 months to bring their systems into compliance.
The document sets out the requirements for the systems that must be followed in the implementation of certification against the requirements of the P&C and/or its National Interpretations. Although most of the document will apply from July 1, 2018, Clauses 4.10 and 4.11 entered into force on Sept 1, 2017.
Clause 4.10 addresses reporting and communications. The certification body must prepare a peer-reviewed certification audit report, including a public summary report, and submit it to the RSPO by the deadlines set. Clause 4.11 pertains to the certificates that the certification body must complete and send to the RSPO Secretariat within the stipulated time-period.
The RSPO Secretariat has also published a revised Standard Operating Procedure (SOP) for Standard Setting and Review. This document, also approved at the June meeting, took effect from July 1, 2017. It sets out the procedures and describes the processes by which the RSPO standards are to be set and reviewed.
In general, two standing committees are charged with the oversight of the standards: the RSPO Standards & Certifications Standing Committee (S&C SC); and the Trade & Traceability Standing Committee (T&T SC).
The S&C SC is responsible for documents describing and relating to the RSPO P&C, while the T&T SC is responsible for documents describing the RSPO supply chain certification standard.
The SOP is particularly relevant as the S&C SC finalises the new P&C. The RSPO standards are reviewed at least once every five years. The existing standard from 2013 is being reviewed for continued relevance and effectiveness, including through the assessment of results of ongoing monitoring and evaluation by the RSPO.
The S&C also decides to what extent it is necessary to conduct stakeholder engagement during the revision process; whether a task force is required; and the extent of public consultation. The Terms of Reference of the S&C SC include:
Once developed, revised standards are to be field-tested so as to assess their feasibility and the extent to which the requirements can be audited. Pilot tests can take place in multiple locations to assess differences in geographical regions. Once endorsed by the BoG, the revised standards are voted upon by the RSPO General Assembly, where a single majority of a fixed quorum of ordinary members is required for adoption.
There are as yet few details of the new RSPO P&C. In terms of the three main roles of the S&C SC – stakeholder engagement; task force creation; and public consultation – reports indicate that the stakeholder engagement process was launched in May 2017.
In addition, on May 26, 2017, the RSPO announced the formation of a Labour Rights Task Force. It is expected that addressing labour rights will be an important part of the revised P&C.
It is also expected that the revised P&C will take steps to improve the ability of smallholders to meet the sustainability criteria, in the hopes of recruiting more of them into the RSPO membership.
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Recent media reports have praised yet another sustainable palm oil standard and label, called ‘Palm Done Right’. The standard was started by Natural Habitats, a business organisation formed by various operating companies and which has offices in Ecuador, Sierra Leone and the Netherlands. Natural Habitats produces, collects, processes and trades organic, fair trade and sustainable palm oil.
Currently, only two companies supply palm oil under the standard developed by Natural Habitats and Dr Bronner’s, a US-based personal care company with operations in Ghana. But it appears that any company that sources palm oil within the ‘Palm Done Right’ supply chain may use the logo on its products and marketing materials.
The presence of yet another palm oil sustainability standard complicates the market for businesses and operators in general. Natural Habitats prefers to refer to ‘Palm Done Right’ as an education programme, but has developed its own sustainability standard and has trademark rights to a logo to be placed on products.
In particular, the standard is for ‘conflict-free palm oil’, which it believes means that such palm oil is produced organically – using natural pest management, multi-cropping and composting – in a vertically integrated supply chain. Moreover, the oil palm must only be cultivated on existing crop land or on degraded land, be handpicked, and preferably be transported using animal labour.
Natural Habitats is of the view that its standard goes beyond other certification schemes, such as that of the Roundtable on Sustainable Palm Oil (RSPO), which is the most widely-used internationally.
Another popular certification standard is by the Palm Oil Innovation Group. Its Charter is intended to build upon the RSPO’s ‘Principles & Criteria’ with regard to deforestation, carbon stocks, biodiversity, greenhouse gas emissions, pesticide use and social relations.
At the national level, the best-known and well-structured sustainability standards and related certifications naturally come from the two countries that produce the most palm oil: Indonesia and Malaysia.
Even more sustainability schemes relevant to palm oil exist, including the International Sustainability and Carbon Certification (ISCC); the certification by the Rainforest Alliance/Sustainable Agriculture Network; the Roundtable on Sustainable Biomaterials; the Sustainable Palm Oil Manifesto guidelines; and the High Carbon Stock Approach, which itself is built into other schemes.
The Centre for International Forest Research (CIFOR) recently asked the question: What will it take to make sustainable palm oil the norm?
This is also a question that NGOs ask. And when they do, it’s a loaded question. It is directed at western companies and policy makers. It goes hand in hand with assumptions that:
Anyone who has a basic understanding of palm oil production and palm oil markets knows that none of these assumptions are true. But there is such great misunderstanding in the debate over palm oil that western NGOs have been able to move it in the opposite direction.
Consider how the NGOs are pushing for tighter, more expensive standards that are completely out of reach for small farmers, and which exclude them from supply chains.
The most egregious example of this is the ‘zero deforestation’ traceability model. This was the model that resulted in Unilever having to cut 80% of its smallholder suppliers from its network.
What this underlines is that most of the NGO arguments around sustainability are simply a string of western moral arguments about the environment. These have little to do with balanced perspectives or producing strong social and economic outcomes on the ground.
The CIFOR research bears out these fallacies – but don’t expect NGOs and campaign groups to leap on the findings.
Take this from the report’s executive summary in relation to uptake of certified sustainable palm oil and ‘zero deforestation’ commitments by major companies:
‘… oil palm growers are a diverse group, operating in a range of contexts; this means that current high profile signs of change by large multinational companies may not be representative of the entire sector.’
Or on the importance of sustainability among smallholder growers:
‘In regions such as Sumatra with long-established oil palm sectors, the number of independent smallholder farmers is growing rapidly. These smallholders have access to an escalating number of independent mills, which offer competitive pricing opportunities. These mills rely heavily on fresh fruit bunches purchased on the open market and often do not have corporate purchasing policies or checks in place for legality and sustainability concerns.’
And on the importance of western markets:
‘…growers are catering to rapidly growing import markets in China and India, which place much less focus on environmental and social principles, compared to western markets.’
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