Reality Check for Malaysian Palm Oil

Coping with sustainability and NGOs

IOI’s Datuk Lee outlined the communications crisis the company had faced when its sustainability certification was temporarily suspended in early April by the Roundtable on Sustainable Palm Oil (RSPO). This was compounded by NGO activism and negative publicity.

A complaint by an NGO involved a relatively small area of IOI’s Indonesian plantations, but the RSPO decided to suspend the sustainability certification for the entire group – thereby also affecting its global downstream operations.

After much work on the ground, the company managed to get the suspension lifted when the RSPO was convinced that improvements had been made.

“The complaints were related to events that had happened two to six years ago. Since then, we had improved our practices, but the decision by the RSPO only came much later,” Datuk Lee explained.

As a company that has been in the oil palm business for many years, IOI is good at managing plantations, he said, but is unfamiliar with the challenge of dealing with NGOs and the online media.

“Following agronomic practices, for example, is no problem. But today we find that [this] is not enough. Now, besides being a plantation specialist, I have to be a communications specialist and [this] is a very new area for [the company].”

“We had to learn to use the right words. And, as we were dealing with the online media and western NGOs, communications had to be maintained round the clock.”

Datuk Lee said IOI believes in openness and engagement with all parties and “was responsive, right from the beginning”.

Another issue, he said, was that a variety of consultants and specialists had offered advice on how the group should handle the situation. This meant that the company had to be cautious about what proposals it accepted.

“There are several kinds of forest specialists, such as peat specialists. Some work on the ground, while others offer services such as landscape planning. And then, of course, there are communications specialists.

“Even among communications specialists, there are different types – some specialise in stakeholder engagement and some specialise in media engagement.”

Datuk Lee said the company would have had to engage many consultants if it had listened to all the proposals it received.

The management, he added, had to be very perceptive and selective, as some advice was unsuited to the company’s needs.