Forest & Land Governance

Palm oil is a global commodity that is extracted from the oil palm tree, Elaeis guineensis. These plantations can be found throughout Southeast Asia, but however largely concentrated in Indonesia’s Kalimantan and Sumatra. The oil palm is an attractive source of livelihood for farmers, due to its high yields compared to soy and canola.

The Problem

Environmental and social issues are inherent in oil palm plantations. Between 1995 and 2000, 54 per cent of palm oil plantations in Indonesia were established at the expense of forests and the people who rely on them. In order to maintain the quality and competitiveness of its palm oil in the international market, the Indonesian Government created a national standardized certification scheme called the Indonesian Sustainable Palm Oil (ISPO) certification system in 2011.

ISPO guarantees that oil palm plantations which have ISPO certification adhere to the scheme’s Principles and Criteria (P&C). These P&C are based on the laws and regulations of Indonesia and ISPO certification has been mandatory for palm oil plantation companies since 2011. As of January 2020, 621 ISPO certificates have been issued covering 5.45 million hectares of palm oil plantations in Indonesia.

Unfortunately, the high issuance of ISPO certification has not been followed by improvements in governance nor has it effectively addressed the negative impacts of the palm oil industry, resulting in the low credibility and accountability of the ISPO system. It is understood that the current ISPO certification is not strong enough to be an instrument to ensure palm oil production in Indonesia is environmentally friendly and upholds social safeguards, including the rights of indigenous peoples and local communities, and it was deemed too limited to receive recognition of its “sustainability” on the international market.

As a result, the Government started a process to strengthen ISPO in 2016, seeking to improve the poor credibility of ISPO certification. Nearly four years later, the review process is still ongoing. However, the current proposals are not satisfactory in terms of several vital points and do not significantly strengthen ISPO.

Kaoem Telapak, together with a coalition of civil society organizations, held discussions and provided input for the ISPO draft after having received the draft from the Ministry of Agriculture on May 2020. The Ministry of Agriculture was urged to seriously revise the draft ISPO standards, both the implementing regulations and P&C.

Kaoem Telapak will be keeping a watching brief on the situation and endeavor to ensure for the better ISPO certification.

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