Sabah’s sustainable palm oil vision: Leading way for people and planet
25/05/2025 (Borneo Post Online) - This regular op-ed column features WWF-Malaysia’s perspectives on pressing environmental issues and events unfolding in Sabah. As an environmental conservation NGO, we also use this space to share our views on potential policy shifts that Sabah’s leaders can implement to foster a greener and more sustainable future for the state.
Oil palm was first introduced to Malaya as an ornamental plant before 1875. Commercial planting began in 1917 in Selangor, and large-scale expansion of palm oil in Sabah took off in the 1970s. Throughout the country, the expansion was part of the government’s diversification strategy to reduce its reliance on rubber and timber. The Federal Land Development Authority (FELDA) and plantation companies were tasked to drive this expansion.
In Sabah, companies such as Sabah Softwoods Berhad started their first oil palm planting in the early 1980s. By 1998, the development of oil palm had reached more than 800,000 hectares. The industry has since grown to be a major economic force in the state. In 2023, Sabah became the largest crude palm oil (CPO) producing state in Malaysia, producing 4.5 million tonnes of crude palm oil (CPO) out of 1.5 million hectares of plantation area.
While generating economic revenue, the development of the palm oil industry has impacted Sabah’s rich biodiversity. In just over 15 years, between 2002 and 2017, land clearing and conversion of forest for palm oil production have reduced the population of orangutans by 30%. Recognising this, Sabah has shifted towards sustainability by emphasising the need for development to be amply balanced by biodiversity conservation.
Rather than seeing the need for development and biodiversity conservation as conflicting priorities, Sabah has charted a bold path that unites them, showing that it is possible to protect forests and wildlife while cultivating prosperity. By embracing sustainability at scale, the state is emerging as a global leader in producing palm oil that works for both people and the planet.
Sabah has proven that palm oil production does not have to come at the expense of the environment. In fact, it can be a solution. The future lies not in choosing between forests or farms, but in making them work together.
A statewide commitment to sustainability
In 2015, the state committed to achieving 100% compliance of sustainability standards for all oil palm in Sabah. This set the pathway to transform Sabah’s palm oil production and supply chain by halting deforestation, restoring ecosystems and securing livelihoods. Sabah has made a bold move by becoming the first Malaysian state to achieve full RSPO (Roundtable on Sustainable Palm Oil) certification across all oil palm operations by 2030.
This commitment goes beyond compliance. It signals a long-term vision where sustainable production is the foundation for global competitiveness, environmental protection, and community resilience. To fulfil this, the Sabah Jurisdictional Approach for Sustainable Palm Oil (JASPO) initiative was set up with the support of the government and stakeholders to transform the palm oil sector.
Conservation through cultivation – Applying WWF’s Living Landscape Approach
Inspired by these progressive policies of the state of Sabah, WWF-Malaysia supports the sustainable palm oil production through an innovative Living Landscape Approach (LLA). The LLA integrates conservation, sustainable development, and responsible land use in places with high distribution of wildlife such as the iconic orangutan and Bornean elephant.
This approach focuses on three pillars: ‘Protect, Produce, and Restore’ – advocating for the preservation of forests, wildlife, and rivers, while also supporting the sustainable production of palm oil and the restoration of degraded lands. The Living Landscape Approach aims to balance biodiversity conservation with sustainable development, providing a platform for stakeholders to build partnership towards achieving this common goal.
These are not mere theories. This approach is already taking place on the ground. Plantation companies like Sawit Kinabalu, KLK, and Sabah Softwoods have voluntarily set aside areas within their estates to reforest and establish wildlife corridors. These corridors are crucial in reconnecting fragmented forests, allowing endangered species such as orangutans, Bornean elephants, and Bornean sun bears to move safely between habitats.
Supporting oil palm growers through strategic partnerships and cooperatives
The transition to sustainable oil cultivation in Sabah has its own challenges. Companies embarking on certification often require initial investment in training their employees, adopt new technologies, and becoming familiar with third party auditing processes. For most independent smallholders and mid-sized palm oil growers, high certification cost hinders them from pursuing stringent RSPO certification.
To address this, WWF-Malaysia has supported the formation of grower cooperatives to make RSPO certification more accessible and affordable. An alphabet soup of cooperatives has been established including Koperasi Landskap Kelapa Sawit Sabah Bhd (LKSS); Koperasi Lestari Penanam Sawit Sabah Berhad (KLASS); and Koperasi Pekebun Kecil dan Sederhana Sawit Lestari Sabah Berhad (KOSALESA).
Through these cooperatives, growers share the cost of audits and training, while also benefiting from technical guidance and group support. All financial benefits from the certification will go back to the growers as an incentive for their sustainability efforts. When WWF first engaged growers in priority landscapes like the Tawau-Kunak Districts and Tabin in Lahad Datu, only 25 smallholders were willing to pursue certification. When the pioneer cooperative began earning premiums and selling RSPO Credits, interest grew among the growers. Today, three times that number are in the process of getting certified.
This growing momentum, coupled with supportive policies from the state government and progressive actions by large plantation groups, is putting Sabah at the forefront of sustainable palm oil globally.
How sustainable palm oil benefits Sabah
Sustainability isn’t just good for the environment — it’s smart for business. RSPO certified producers enjoy a range of benefits such as premium market access in Europe and North America. Certified growers obtain higher prices for certified Fresh Fruit Bunches (FFB) and are able to trade RSPO Credits as an extra income stream. They too benefit from increased returns as a sustainable approach to palm oil cultivation results in improved productivity from better soil, water and pest management.
Through responsible practices, growers also become stewards of the land, protecting high conservation value (HCV) areas, preserving ecosystem services, and strengthening their relationships with local communities and workers.
Beyond its direct benefits to oil palm growers, support for sustainable palm oil is crucial for addressing environmental, social, and economic concerns associated with palm oil production. Sustainable palm oil embraces the People, Planet, Profit framework, also known as Triple Bottom Line (TBL) sustainability framework that expands the traditional focus of business beyond financial profits to include social and environmental performance.
Under the TBL framework, sustainable palm oil incorporates social equity aspects throughout its supply chain. These are fair labour practices, wages and working conditions, employee well-being, community engagement, as well as diversity, equity and inclusion. TBL environmental sustainability commits to the goal of minimising negative environmental impacts and contributing positively to environmental health by reducing carbon footprint, employing responsible waste management, conserving water and energy, sustainable sourcing of materials, and protecting biodiversity.
Lastly, the TBL framework’s economic viability aspect aims at not only maximising financial performance based on revenue, expenses and profitability. It also takes into account its overall economic impact on a society as represented by job creation and economic stability, responsible tax payments, as well as ethical and fair financial practices.
Consumers are the answer
In environmentally conscious markets, consumers drive the demand for sustainable palm oil. Over the last 30 years, arising from consumer pressure, supermarkets and retail companies in consumption countries have required their suppliers to supply sustainability-certified palm oil products.
Slowly but surely, growing consumer awareness from Asia Pacific countries including the affluent and middle class from China and India will drive producers to adopt more responsible practices, protecting the environment and supporting livelihoods. Sabah being a global leader on environmental protection, biodiversity conservation and sustainable palm oil production will stand to gain by becoming an even more globally competitive state.