CSR, Oil Palm and the RSPO: Translating Boardroom Philosophy into Conservation Action on the Ground

Abstract

Effective corporate social responsibility (CSR) is becoming mainstream strategic business planning for the oil palm industry. At its core, CSR aims to align business values with the needs and expectations of a broader range of stakeholders, beyond just investors and shareholders. In oil palm, this entails taking responsibility for social and environmental impacts, often beyond what is required by law, to build social and environmental capital in pursuit of a local “license to operate.” Third-party certification standards are a popular tool for guiding and monitoring the impact of CSR programs and have taken root in oil palm through the multi-stakeholder Roundtable on Sustainable Palm Oil (RSPO). Eight years running, the RSPO has made substantial inroads to improve the environmental and social performance of Southeast Asia's largest and fastest growing plantation industry. Yet serious challenges remain for RSPO to mainstream environmentally sustainable and socially responsible practices throughout the supply chain. Based on experiences working with multi-stakeholder groups to implement RSPO, including industry, government, local communities, and NGOs, we highlight areas where change is required not only among growers but also the broader RSPO membership to build on recent achievements and accelerate progress. Major challenges include (1) improving corporate governance of plantation companies to translate boardroom CSR decisions into conservation actions on the ground; (2) pushing RSPO member processors, traders, manufacturers, and retailers, who profit from palm oil, to share the cost burden of implementing sustainability, (3) strengthening NGO partnerships with companies to provide the social and environmental expertise companies require but still lack, and (4) creating a more supportive regulatory structure in producer countries to implement sustainability. Challenges to RSPO progress can be overcome, but will require coordinated action to ensure that the scale and pace of change is sufficient to deliver long-term benefits for the environment before it is too late.