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Monday, 5 December 2016

Issues with the RSPO

When RSPO members go against the movement’s objectives.

At the fifth The Star Roundtable on Palm Oil recently, industry captains – IOI Corporation Bhd CEO Datuk Lee Yeow Chor, Malaysian Palm Oil Council CEO Tan Sri Dr Yusof Basiron, United Plantations Bhd vice chairman and chief executive director Datuk Carl Bek-Nielsen, Felda Global Ventures Holdings Bhd group president and CEO Datuk Zakaria Arshad, Kuala Lumpur Kepong Bhd CEO Tan Sri Lee Oi Hian and Sarawak Oil Palms Bhd group CEO Paul Wong – discussed RSPO and MSPO certification and standards.

THERE has been some level of uneasiness within the Roundtable on Sustainable Palm Oil over issues such as its own members using the “no palm oil” label on their products. Datuk Carl Bek-Nielsen (pic), as co-chair of the RSPO board of governors, spoke out on this in Bangkok last month. How can we resolve the situation?

Bek-Nielsen: Over the last 15 years, the issues concerning global warming have intensified. In some countries, it has become rather extreme and ignores the plight of less developed nations which see issues such as food security and poverty alleviation superseding that of mitigating greenhouse gas emissions. Some regions, like in Europe, are adamant that we need to do something about global warming, and because of this there are many ramifications, not just for industries, but in the end how we choose to live our lives.

For us out here in the developing world, it is very much like walking past a restaurant where the rich world is having an eight-course dinner. These richer nations have reached developed status and their bellies are full. They then invite us in for a cup of tea, and when we join them, they say we must now split the bill equally. We have got to try and balance the picture without going overboard.

In that sense the RSPO has a vital role to play through engagement with a multi-stakeholder process and where one accepts that there are balances which need to be struck without losing sight of the target when it comes to producing palm oil in a sustainable manner.

In this connection I see four big problems with the RSPO.

First, we are neglecting the importance of the smallholders. I spoke out about this recently in Bangkok. The RSPO is setting the ceiling too high for the smallholders to cling on to. We cannot ignore that we have a huge segment of society which is dependent on the oil palm, a vast majority of which are smallholders. To many of them the aspirations of the RSPO are simply too high to reach and if this is not properly addressed, the RSPO could face a Brexit moment as a large segment of the smallholders may just say “enough is enough”.

The second problem is related to the uptake of sustainable oil. How can we have a situation where only 50% of sustainable palm oil is taken up? Believe me, many growers have taken a leap of faith, they have voluntarily joined the RSPO and fulfilled the criteria of producing sustainable palm oil. It is now time for the other members to live up to their part of the equation so that much more attention is directed to driving up demand for RSPO-certified palm oil so the imbalance between supply and demand can be harmonised.

Thirdly, there is the “no palm oil” labelling issue. On behalf of the growers it is my obligation to state that we cannot accept nor condone the RSPO’s current rules whereby RSPO members themselves are allowed to use the “no palm oil” labelling. The RSPO has 3,080 members today and there are 489 products belonging to RSPO members that officially state “no palm oil”. That is a 16% increase since Jan 1 this year. How can we be members of an organisation that promotes production and uptake of sustainable palm oil and yet it allows its own members to go out there and declare that their products have “no palm oil”. This is an unfortunate example of hypocrisy.

The final issue that we are fighting for is termed as “commensurate effort”. There must be a level playing field for all members. It is not right that we growers alone are pulled around the circus arena and asked to do backward somersaults. There must be a commensurate effort for all members. In other words if we push, you push. If we pull, you pull. And if we produce, you should buy or promote the buying. Otherwise, why should growers continuously be requested to produce certified sustainable palm oil when there is only 50% of the produce taken up?

Tags / Keywords: Palm Oil , Plantations , Commodities , Stocks , Earnings , Corporate News , Investing , palm oil

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