Abstract

Palm oil is one of the major plantation commodities and contributes significantly to the GDP of Indonesia. One of the areas known for palm oil production is Jambi, where smallholder plantation dominates. The literature shows that the plantation sector is often characterized by conflicts, including small-scale farmers and big companies. Therefore, appropriate conflict management strategies should be put to mitigate these conflicts’ potential adverse impacts. This paper aims to review the existing literature on conflict management strategies and examine these strategies’ factors. It highlights the different conflict management styles: integrating, obliging, dominating, avoiding, and compromising. For example, the literature shows the relevance of Big Five personality, where positive relationships are documented between integrating style with conscientiousness, agreeableness, openness, and extraversion Therefore, this paper argues the importance of incorporating psychological factors in determining appropriate conflict resolution management due to this possibility of strategy implementation among actors with different psychological factors.

Highlights

  • Palm oil is one of Indonesia's primary plantation commodities, which has significantly become a major source of national non-oil and gas income

  • While it has a significant contribution to economic growth, the palm oil sector has been subjected to scrutiny due to its role in biodiversity loss and deforestation in several countries, including Indonesia

  • Following [7] typology, this paper argues that several aspects should be considered to design effective conflict management strategies in Indonesia's palm oil industry

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Summary

Introduction

Palm oil is one of Indonesia's primary plantation commodities, which has significantly become a major source of national non-oil and gas income. The demand for palm oil has been increasing. The total export value of Indonesian palm oil was USD 19 billion and contributed 17% to the agricultural sector's GDP in 2019. While it has a significant contribution to economic growth, the palm oil sector has been subjected to scrutiny due to its role in biodiversity loss and deforestation in several countries, including Indonesia. The issues related to sustainability surrounding the palm oil industry emerged. The role of palm oil sector on poverty alleviation has been investigated, where it depends on various factors, such as biophysical condition and initial socio-economic conditions [1]

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