Download - Sustainable Palm Oil - Pro
SUSTAINABLE PALM OIL A CHALLENGE – PRO
KARTIBAN ASOKAN
SITI INSYIRAH BINTI ALI
JUWAIRIAH BINTI HARIS
THARANI A/P RENGASAMY
ANAS MOHAMMED
KORNTIP KOKYAI
INTRODUCTION• Increasingly common raw material for food and
non-food product• 1 in 10 products contains palm oil in some form• The demand of palm oil have increased due to
usage in bio-fuel, thus it becomes 2nd most consumed oil after soybean oil • Its cheaper, easier to store(room temperature)
WHAT HAPPENS DUE TO FARMING OF PALM OIL
• Loss of rainforest in Malaysia and Indonesia, tropical forest and peat land are cleared • Within the next 15 years almost all of the rainforest
will be disappeared • Disappearance of rare species, Orangutan and
Sumatran tigers• Escalate the climate change
HOW TO HAVE A SUSTAINABLE PALM OIL ???• In 2001, the WWF had set up The Roundtable on Sustainable Palm Oil (RSPO)• To establish standards for producing and procuring palm oil in a sustainable
manner• RSPO promotes the production and uptake of sustainable palm oil through
cooperation and open dialogue with its stakeholders with the ultimate goal of transforming markets to make sustainable palm oil the norm
• the most advanced standard setting platform that is dedicated to the sustainable production of a single commodity
• Today, the RSPO comprises 1,400 members covering the entire supply chain of an extensively used and traded commodity
• As of late 2013, there are 14 Malaysian plantation companies with 105 palm oil mills that are RSPO-certified.
QUESTION 1The Roundtable on Sustainable Palm Oil is a multi-stakeholder initiative. What actors need to be part of the
initiative for the problem to be addressed in an effective way?
Stakeholder categories within
RSPO
Palm oil growers
Palm oil processors and traders
Bank and investors
Consumer goods
manufacturersRetailers
Social and development
NGOs
Environmental NGOs
Develop, gather and publish uniform ESG performance
dataUndertake awareness raising and more in-depth education
Share and develop best practice analytical and
investment tools
Be flexible in its membership cost
Clarify what the RSPO requires in terms of commitments and actions to transform the palm oil industry
WHAT RSPO SHOULD DO?
Stakeholders ActionAsset Owners Refine Requests for Proposals to include ESG and palm oil
specific criteria. Asset Managers Engage collaboratively with their Asian counterparts.
Buy-side Analysts Fund detailed coverage from specialist research providers.
Sell-side Analysts Include material ESG risks and opportunities into their analysis.
Investee Companies Respond to analyst requests for ESG metrics being reported.
Financial Intermediaries Support decision-making tools with impactful reporting.
Extra-financial Research Providers
Supply regular and consistent ESG content beyond questionnaires
Market Data Providers Embed metrics and key performance indicators for CSPO.
NGO Community Provide succinct key performance indicators, tools and research.
RSPO Work on data transparency.
QUESTION 2WHAT IS HINDERING THE DEVELOPMENT OF SUSTAINABLE PRACTICES IN THE PRODUCTION OF PALM OIL?
ENVIRONMENTAL SIDE EFFECTS• Oil palm cultivation on land that was previously covered with peat-swamp
forests, primary forests or other high conservation value areas.
• Such areas, already under pressure from other factors such as logging, are highly valued for their biodiversity and their capacity to sequester carbon dioxide.
• Forest parcels are sometimes cleared by fires, which can burn out of control.
• The building of roads through forests has been blamed for hindering the migration of endangered species and exposing them to human activities.
SOCIAL SIDE EFFECTS
• Increasing number of communities who legally farming/living in the plantation affecting the area of plantation.
• Several reports of plantations that violates workers’ right (e.g: fair payment, safe working condition, freedom to unionize)
QUESTION 3WHAT DEVELOPMENT HAVE TO TAKE PLACE TO MAKE THE PRODUCTION OF PALM OIL MORE SUSTAINABLE?
• Choose certified sustainable palm oil • What is certified sustainable palm oil?• Palm oil that was certified by the RSPO through criteria that can help to
reduce the negative impacts of palm oil cultivation on the environment and communities
• Buy the products with certified sustainable palm oil – indirectly can encourage nature conservation
• No primary forests or areas which contain significant concentrations of biodiversity (e.g. endangered species) or fragile ecosystems, or areas which are fundamental to meeting basic or traditional cultural needs of local communities (high conservation value areas), can be cleared.
Socially acceptable Technologically appropriateEconomically viableEnvironmentally compatible
Conclusion
VEGETABLE OILS ARE INCREASINGLY POPULAR
Source : Roundtable on Sustainable Palm Oil (RSPO),2012
WHY IS PALM OIL SO POPULAR?
Source : Roundtable on Sustainable Palm Oil (RSPO),2012
Relatively cheap
Most widely
produced
Most versatile
Highest yielding
Why say yes to sustainable palm oil instead of no to palm
Source : Roundtable on Sustainable Palm Oil (RSPO),2012
Fulfills increasing global food demand
Supports affordable food prices
Supports poverty reduction
Safeguards social interests, communities and workers
Protects the environment and wildlife
Why say yes to sustainable palm oil instead of no to palm
Source : Roundtable on Sustainable Palm Oil (RSPO),2012
Producers will switch to other
oils which require 4-10
times more land for the same amount of
output as palm oil
Producers will switch to other oils which are
relatively move expensive
Livelihoods and income
will be impacted as oil palm is widely cultivated by a
significant number of
smallholders in developing
nation
Social issues will just shift to other vegetable
oils that face similar
concerns
CONSEQUENCES OF ERADICATING PALM OIL
Source: http://www.betterpalmoil.org/what
Why say yes to sustainable palm oil instead of no to palm
Source: http://www.betterpalmoil.org/what
GETTING GREENER