24/01/2008 (Marketing Week) - Environmental groups have criticised a plan by Unilever, Johnson & Johnson, Nestlé and Heinz to certify palm oil as sustainable for not going far enough and having "fundamental problems".

Last week the companies signed up a consortium of 200 oil producers and commercial buyers to the Roundtable on Sustainable Palm Oil (RSPO), which is working on a system to certify palm oil operations as meeting environmental criteria. The production of palm oil is reportedly causing the widespread loss of forests in Indonesia, which has the fastest rate of deforestation of any major forested country.

But Greenpeace says that the RSPO plan for certification, due to be applied in April, is "unable to deliver real sustainable standards that will prevent further forest clearances". A Greenpeace spokeswoman says: "If the RSPO was serious about addressing the problem it would refuse to buy palm oil from sources that will not involve further conversions."

Friends of the Earth (FoE) adds that the RSPO scheme has "fundamental problems" because it "will create an ethical market and an unethical market". An FoE spokesperson says: "It doesn't guarantee sustainability and I question if it is the best long-term solution."

Under pressure from environmental groups and retailers about the destruction of forests for the production of palm oil, multinational consumer goods companies formed the RSPO in 2003. Unilever, the world's largest single buyer of palm oil, is a founder member.

The World Wildlife Fund, which was involved in the formation of the RSPO defended the scheme. WWF-UK senior policy officer Adam Harrison says: "It is not 100% perfect but it certainly addresses some of the issues."

In November last year, Greenpeace accused Nestlé, Procter & Gamble, Unilever and Kraft of being "climate vandals" for their part in clearing tropical forests.