Malaysia, EUMCCI: sustainable palm oil the way forward

Over the years, palm oil has received a lot of flak. Ask the average person on the street, and chances are that he or she will pile the blame of environmental concerns such as the haze on this type of oil.

However, experts caution us not to dismiss palm oil entirely: they say that palm oil, when sustainably resourced,brings benefits to the environment, workers involved as well as animals.

This was the point of view of Chief Executive Officer of Malaysian Palm Oil Council Dr Kalyana Sundram who spoke at the EU-Malaysia International Discourse on Palm Oil Sustainability. The event was held by the EU-Malaysia Chamber of Commerce and Industry (EUMCCI) on 11th October in Kuala Lumpur.

“Palm oil has a bad image. Positive attitude about sustainable palm oil is still low,” he said, noting that some people have never even heard of sustainable palm oil.

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However, he said that there are good regulatory frameworks that Malaysia is accountable to when it comes to palm oil: Malaysian palm oil is certified under Round table on Sustainable Palm Oil (RSPO), Malaysian Sustainable Palm Oil (MSPO) and International Sustainability and Carbon Certification (ISCC).

RSPO, for example, is 3,583 members strong. MSPO is not mandatory, but is expected to be in 2019. MSPO kick-started in 2015, based on certain standards. It provides general principles for the production of sustainable palm oil that covers the 3Ps: People, Planet and Profit. Key sustainability issues faced by the industry, such as environment and biodiversity, best practices and social responsibilities are all embedded in MSPO’s seven principles.

Roberto Benetello, Chief Executive Officer of EUMCCI, echoed the sentiment that sustainable palm oil is the way forward.

“This year, Malaysia celebrates 100 years of commercial oil palm cultivation. This is a proud achievement indeed because the Malaysian palm oil industry is one of the best regulated in the world with more than 50 laws and regulations related to its development,” he said

Benetello added that the EUMCCI’s role in Malaysia is to ensure great cooperation among Malaysia, EU and its Member States for a sustainable of palm oil at every level of the supply chain.

“EUMCCI will continue to cooperate and to support the efforts of Malaysia to minimise deforestation and other negative impacts that palm oil cultivation can have in order to achieve sustainable production of this commodity,” he said.

Deputy Secretary-General (Energy and Green Technology) Minister of Energy, Green Technology and Water Datin Badriyah binti Ab Malek said: “To achieve sustainable living, business community and the industry too, need to ingrain sustainability as a guiding principle in the many choices each company or organisation makes every day.”

She said that inn 2016, the exports of Malaysian palm oil and palm-based products were valued at RM67.6 billion. RM10.3 billion of that was imported to the EU.

“The palm oil industry has contributed to the national socio-economic development through providing employment opportunities, development of upstream and downstream industrial activities as well as promotion of domestic and external investments,”

“Furthermore, the oil palm sector provides employment opportunities to more than 2 million workers, including 650,000 smallholders. As such, the sector has been identified as a key driver in eradicating rural poverty and raising the overall living standards in this country. It is therefore important to strengthen efforts in ensuring the sustainable development of the oil palm industry,” she said.

What sustainable palm oil means

Palm oil is one of the most versatile oils in the world. It exists in many of our everyday products including margarine, ice cream ad shampoo. However, the oil palm tree only grows in the tropics where its cultivation can have disastrous impacts on people and the environment. This is where sustainability steps in.

Group Chief Sustainability Officer of Sime Darby Dr Simon Lord outlined the ways forward to sustainable pam oil, including: no deforestation, no exploitation of workers, an increase in the promotion of health as well as the promotion of traceability – that is, people have clear knowledge of where the palm oil is sourced from.

Low demand of palm oil from consumers

However, despite the government’s effort to promote sustainable palm oil, its demand among Malaysians remain low.

Recently, the World Wide Fund for Nature (WWF) released a scorecard which measured the commitment of 47 Malaysian and Singaporean towards sourcing 100 % certified sustainable palm oil. Only 16 disclosed the information. That means 70 % of the companies in Malaysia and Singapore didn’t respond.

“We want to make sustainable palm oil the norm in Malaysia but consumers are not demanding better products,” Denise Westerhout, the lead for WWF Malaysia’s sustainable markets programme, said.

However, Dr Kalyana Sundram, had another view: “It is not fair to say there’s less uptake of sustainable palm oil in Malaysia at this time.”

He said the biggest challenge is smallholders because certification is a burden to them, as it involves strict red tape and many forms to be filled. Therefore, Dr Kalyana Sundram said the government is giving financial incentive to these smallholders to obtain certification.

The EU-Malaysia International Discourse on Palm Oil Sustainability Part was part of the EUMCCI’s 2017 Europa Awards Sustainability initiative. It was one of the many programmes and activities of the International Greentech and Eco Products Exhibition and Conference Malaysia 2017 which highlighted the different points of view and perceptions on the issues of sustainable palm oil in a foreign market.

 By Mohani Niza

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