MARKET DEVELOPMENT
International NGOs and Palm Oil Companies Launch New Leadership Initiative
International NGOs and Palm Oil Companies Launch New Leadership Initiative
11/07/2013 (CSR Asia) - Last week, some of the world’s most prominent NGOs and leading palm oil producers announced a cutting-edge initiative – the Palm Oil Innovation Group (POIG).
On the NGO side, the signatories to the charter are real heavy-weights: Greenpeace, WWF and the Rainforest Action Network (RAN), as well as the social grassroots NGO Forest Peoples’ Programme. The companies involved are a very diverse group. Two relatively small Latin-American companies, Agropalma (Brazil) and DAABON (Colombia) are included, along-side PNG-based New Britain Palm Oil and one of the world’s largest producers Golden-Agri Resources (Indonesia). Sadly, no Malaysian companies have signed up – leaving out the world’s second-largest palm oil producer country.
The initiative is based around a detailed charter, which adds significantly to existing best practice and to the Roundtable on Sustainable Palm Oil (RSPO standard). The full details are not publicly available, but the headlines can be found in this press release. The most significant commitment is probably the goal of breaking the link between palm oil expansion and deforestation – an issue where the RSPO has often been criticised of being too weak. Accountability and reporting is also given a prominent boost in the charter - POIG companies commit to regular sustainability reporting, GHG and water accountability as well as effective means to counter bribery and corruption. Such increased transparency is sorely needed in an industry where much sustainability innovation is taking place, but where less than 10 companies produce GRI reports to account for their performance and improvements.
For observers of sustainable palm oil, this initiative has been expected for a long time. It has long been clear that some companies were moving rapidly ahead of the RSPO standard, often in close partnerships with NGOs. The recent revision of the RSPO standard was criticised by many for being too unambitious. It became clear that the gap between the standard and the ambitions of the leading palm oil producers had to be addressed – allowing those with leadership aspirations to move ahead and get some recognition for their significant efforts and investments. The POIG charter closes the gap by creating a clear road-map for companies seeking to meet stakeholder expectations which is publicly endorsed by some of the biggest RSPO critics.
The good news is that the POIG is clearly being positioned as an addition and complimentary to the RSPO – not as a replacement. For a few years, there has been speculation that some producers might abandon the RSPO standard to meet the expectations of critical voices who point to the weaknesses of the RSPO standard. The decision by the POIG to position itself as an improvement on the RSPO is therefore critical, as the RSPO (in my humble view) remains the primary vehicle to lift mainstream palm oil standards, and help abandon the worst practices in the sector. Abandoning the RSPO standard in favour of a platinum version could have caused severe damage to the progress made at the bottom of the industry. Instead, the POIG helps to create a race to the top – where leaders are finally given credit and encouraged to go beyond best practice.
On the NGO side, the signatories to the charter are real heavy-weights: Greenpeace, WWF and the Rainforest Action Network (RAN), as well as the social grassroots NGO Forest Peoples’ Programme. The companies involved are a very diverse group. Two relatively small Latin-American companies, Agropalma (Brazil) and DAABON (Colombia) are included, along-side PNG-based New Britain Palm Oil and one of the world’s largest producers Golden-Agri Resources (Indonesia). Sadly, no Malaysian companies have signed up – leaving out the world’s second-largest palm oil producer country.
The initiative is based around a detailed charter, which adds significantly to existing best practice and to the Roundtable on Sustainable Palm Oil (RSPO standard). The full details are not publicly available, but the headlines can be found in this press release. The most significant commitment is probably the goal of breaking the link between palm oil expansion and deforestation – an issue where the RSPO has often been criticised of being too weak. Accountability and reporting is also given a prominent boost in the charter - POIG companies commit to regular sustainability reporting, GHG and water accountability as well as effective means to counter bribery and corruption. Such increased transparency is sorely needed in an industry where much sustainability innovation is taking place, but where less than 10 companies produce GRI reports to account for their performance and improvements.
For observers of sustainable palm oil, this initiative has been expected for a long time. It has long been clear that some companies were moving rapidly ahead of the RSPO standard, often in close partnerships with NGOs. The recent revision of the RSPO standard was criticised by many for being too unambitious. It became clear that the gap between the standard and the ambitions of the leading palm oil producers had to be addressed – allowing those with leadership aspirations to move ahead and get some recognition for their significant efforts and investments. The POIG charter closes the gap by creating a clear road-map for companies seeking to meet stakeholder expectations which is publicly endorsed by some of the biggest RSPO critics.
The good news is that the POIG is clearly being positioned as an addition and complimentary to the RSPO – not as a replacement. For a few years, there has been speculation that some producers might abandon the RSPO standard to meet the expectations of critical voices who point to the weaknesses of the RSPO standard. The decision by the POIG to position itself as an improvement on the RSPO is therefore critical, as the RSPO (in my humble view) remains the primary vehicle to lift mainstream palm oil standards, and help abandon the worst practices in the sector. Abandoning the RSPO standard in favour of a platinum version could have caused severe damage to the progress made at the bottom of the industry. Instead, the POIG helps to create a race to the top – where leaders are finally given credit and encouraged to go beyond best practice.