IT is almost impossible for most consumers to go a day without using or eating something that contains palm oil, one of the world’s most controversial ingredients.
About 58.84 million tonnes of palm oil are produced every year, with Indonesia and Malaysia accounting for 85 per cent of total output.
Thanks to the world’s leading body for the certification of sustainable palm oil, The Roundtable on Sustainable Palm Oil (RSPO), for creating new standards to tackle deforestation, human rights violations and greenhouse gas emissions on certified plantations.
Malaysia is placed at seventh in the Top 10 RSPO members by countries (out of 92) with 136 members.
In Sabah, one of the industry players, Sabahmas Plantation, a company under Asia’s leading agribusiness group Wilmar International Limited, is here to make a difference in oil palm plantations.
Sabahmas Plantation is located adjacent to Segama River and Tabin forest and wildlife conservation. Its corporate social responsibility (CSR) objective focuses on sustainable practices to protect and enhance the local environment and wildlife as well as to provide the staff and workers community a healthy and safe working environment.
The plantation company, the third largest group in Sabah was formerly under Kretam Holdings Berhad.
The humble journey started way back 18 years ago after PPBOP Berhad bought over the property in August 1998. The operations began with 8,368 ha planted from the total land bank of 10,477 ha ranging from 1994 to 1998 planting, operated into three estates.
Development of the balance of the plantable areas resumed in 1999, after the takeover, and completed the same year itself for a total area of 630 ha.
Sabahmas Plantation’s visions are:
1. To preserve conducive working environment for all employees and stakeholders with standard building infrastructure compliance to employee housing act.
2. The social and welfare, women and children and safety and health committees were established to provide platform for employees and stakeholders to bring their grievances and suggestion to the employer for further improvement.
3. To create a win-win situation and foster relationship between employees/stakeholders and employer through social interaction such as Labour Day sport carnival.
4. To be fully responsible in preserving the flora and fauna species within the plantation for future generations.
5. To plan and implement the conservation of the riparian zone along Segama River by reestablishment of a suitable tree planting programme.
6. To train and educate people on awareness of environmental protection, especially on proper waste disposal.
7. To provide training on awareness of safety and health for employees and stakeholders in workplace.
The general manager for Sabah Plantations Operations, Kiaw Chee Weng said in the old days during pre-RSPO certification, and pre-sustainable oil palm, it was all about chasing maximum profit.
“Don’t get me wrong, being profitable is still important because otherwise there will be no resources to put into doing all the right things, like building good housing for workers, paying them fairly, conserving areas for wildlife protection. All of this cannot be done without money.
“But now, if we want to still be in business, we have to move with the times. The oil palm industry has taken so much away from the environment and people in the past, so it is now time for the industry to give something back. This is our philosophy in Wilmar,” he said.
To Kiaw, sustainability is about security.
At the end of the day, if the company meets all legal requirements and more, the management team knows that it is operating with nothing to fear.
“If you treat your workers well (which you are required to do under the sustainability certification requirements), you will be protected. There is no one to threaten your security.
“Since we put in place RSPO certification requirements, we have seen things improve with our workers. Our relationships with our workers are more respectful, and they are happier. When our workers are happy, productivity is positively impacted. Our workers feel that they have more security for their kids’ future, for their own families. So, they stay with us. This has been one of the more obvious improvements that I have seen with the sustainability movement in oil palm.”
Kiaw added that the initial days were hard, for workers and also for the managers.
“When suddenly there is a change of practice, it is not going to be easy.
“But when the top management is committed and supporting, it is just a matter of doing it.
“Sustainability also pays off for the company. We have market access to all the demanding requirements of Europe and Western countries, and there is of course a premium for sustainable certified oil palm.
“I mean, the premiums are not huge, but it is enough to pay for the amount you need to spend to maintain the high standards,” he said, referring to three major certifications obtained by Sabahmas Estate and mill, namely RSPO, ISCC and RSPO-RED (the latter two certifications being sustainable biofuel schemes).
“Also there are the savings, for example, with circle and path spraying, the wild vegetation elsewhere actually prevents caterpillar damage to the palm fronds. Before, when everyone was blanket spraying, there was also caterpillar breakouts, and we had to spend a lot of time and effort and resources to eradicate these. Now, we never get them. So we use less herbicide, and we have also helped to reduce a major pest,” he said.
Kiaw has been with the Wilmar group of plantation companies in Malaysia for almost 25 years. He started out his career with Saremas plantations in Sarawak, working for many years at management level in IOI Plantations, before returning to Wilmar.
Meanwhile, its general manager (Group Sustainability), Perpetua George, said in the early days of RSPO implementation in Wilmar it was all about trial and error and troubleshooting.
“We would try all sorts of things and then eliminate options that just didn’t work or were too impractical. As an example, chemical spraying. As recently as 10 years ago, workers would bring concentrated chemicals to the field and then when they get to the site, would hunt around to find a water source in ditches, ponds etc and then follow instructions to mix the chemicals.
“The problem was how to reduce workers’ exposure to concentrated chemicals. Part of the solution was about pre-mixing the chemicals, so we only had one trained person doing this.
“We tried lots of things, like having the pre-mixed chemicals in jerry cans or plastic containers. We then tried getting trucks to bring the pre-mixed chemicals to specific points before the workers arrived.
“With trial and error, we now pre-mix chemicals in a specially designed mini tanker that also has space to carry the sprayers to the different sites. They no longer have to worry about touching concentrated chemicals, or about getting the instructions correct,” she said.
Perpetua said not many people appreciated the amount of trial and error and problem solving that were involved in order to find usable solutions that were practical and actually implementable.
“But when they get it right, the benefits come across the board to both worker and company.
“So as we have gone through this experience, our estate and mill managers as well as our workers recognize the benefits of implementing sustainability requirements.
“While we started off with the estates and mills doing things because it was required by the top management, we now have the workforce really committed and believing in sustainability. It is also a good feeling to join Wilmar as a company that truly believes in sustainability,” she said.
Perpetua, 38, who is also a Sabahan, started her career working with WWF-Malaysia Sabah Programme in its forest conservation programme.
Later, she went on to complete a Masters in Ethnobotany (Anthropology), in order to better understand the relationship between communities and effective conservation.
She then went on to work for Proforest, a consultancy firm focussed on sustainable production. It was in this capacity that she first worked with Wilmar, assisting the Wilmar sustainability and operations team with training, and assessing progress to meeting the requirements from sustainability standards.
In particular, from 2007- 2011, she helped the initial implementation of Wilmar’s RSPO certification. After two years spent at Unilever in Singapore working on its palm traceability commitments, she joined Wilmar in 2015.
Her current scope at Wilmar covers the implementation of sustainability requirements and maintenance of certification at Wilmar’s own plantations in Malaysia and Indonesia, and also compliance of Wilmar’s third party suppliers of palm oil to its No Deforestation, No Peat, and No Exploitation Policy (NDPE Policy).
“Sustainability is something that takes some time to get started. It is a bit like building a railway. It takes some effort to build, put down train tracks, but once they are in place. it’s there permanently and it’s all about maintenance.
“For sustainability implementation, in the beginning it is all about changing the way people work, and it can be challenging because it is human nature to avoid change and disruption. Once you have it in place though, it becomes second nature,” she said.
In Sabah, there is a lot of these experiences already in implementing sustainability.
Based on RSPO data, as of end 2016, 28 per cent of Sabah’s entire oil palm plantation areas are already RSPO certified.
“We recognize that some of the smaller companies need help, because not all companies can afford to go through the same trial and error that Wilmar had to go through. Wilmar’s philosophy is also to share and engage with our suppliers to help them get to the same sustainability standard that Wilmar has achieved, so, they don’t have to go through all the hard thinking, and can just implement solutions that we know work,” she added.
According to her, Sabah has so much potential to be a serious sustainable natural resource global player.
Perpetua and her colleague, Ginny Ng, who is Wilmar’s Global Forest Conservation Lead, sit as members of the Sabah Jurisdictional Certification Steering Committee (JCSC) representing Wilmar.
The JCSC was set up under the guidance of the Sabah Forest Department and the Natural Resource Department of Sabah, in order to push forward the stated intent to achieve RSPO certification for the entire state of Sabah by 2025.
This commitment was approved by the Sabah State Assembly in November 2015.
Aside from Wilmar and government agencies including Sabah Forestry Department (SFD), National Registration Department (NRD), Environment Protection Department (EPD), the JCSC also includes key Sabah stakeholders, including NGOs such as Forever Sabah, WWF-Sabah, Hutan, Sabah Environmental Protection Agency; and the private sector, including HSBC Sabah, Sime Darby, TSH and Sawit Kinabalu.
“Together, the intention is to give Sabah an edge and capitalize on our state government’s commitment to a green economy which can combine sustainable forests (there is already an existing commitment for all of the state’s forests to be sustainable certified to either FSC or MTCC by 2018), natural tourism and sustainable oil palm.
“Based on MPOB statistics, in 2016 Sabah exported some four million tonnes of palm oil via Sandakan and Lahad Datu ports.
“In the same year, Malaysia as a whole exported over 2.4 million tonnes of palm oil to EU countries. With the EU’s Amsterdam Declaration requiring all palm oil in the EU to be from a sustainable certified source by 2020, Sabah is well placed to be able to deliver what the EU wants.
“This is a massive opportunity for Sabah, and as a company with deep roots in Sabah, and with our own experience, Wilmar believes that it can be done,” she said.
As Wilmar’s NDPE policy requires compliance by all its suppliers, Perpetua said the company strongly believes that the approach has to be one where it assists and provides as much support as possible.
“International civil society tends to seek for immediate suspension whenever there is a non-compliance. We don’t think this is right. Suspension has to be the last resort, because once you cut the relationship, you cut any ability to influence.
“And the sad truth is that there is a market for unsustainable palm oil. It will not stop the bad practices. We in the Wilmar sustainability team now are spending more and more time with suppliers, because you need to engage, engage, and engage; get them to understand the issues, and share our experiences and solutions.”
She believed helping them would be the only way to transform the industry.
“In many ways it is like being the big sibling helping the younger ones.
“We, alongside our peers in Sabah who were early adopters of sustainable certification, have this experience and it would be a shame not to share and help contribute to getting sustainability as the norm for the entire state,” she said.