In-Depth

Common Ground

Can palm oil be sustainable? WWF is working with communities in Malaysia to prevent palm oil deforestation and protect the country's important biodiversity.

Issue: Winter 2020
Author: Sandy Ong
Photographer: Aaron Gekoski

Tawau, the east Malaysian district where Christina Ak Lang grew up, is a tropical paradise. The surrounding sea is a brilliant blue, so clear you can see the coral reefs below. Journeying inland, you’ll find gently rolling hills covered with thick stands of trees.

It was in one of these forests that Lang spent many happy days in her youth. “The forest was my playground,” the 43-year-old says. “I used to see sun bears and wild boars.”

But now, much of Tawau’s terrain has been transformed. The rain forest where Lang played is gone, replaced like many others in the area by rows of spiky palm trees that stretch as far as the eye can see. These are the oil palm plantations that today cover more than 50% of the landscape.

“I feel sad that it’s all turned into oil palms,” says Lang, an office supervisor at Sawit Kinabalu, the third-largest oil palm grower in the state of Sabah, where Tawau is found. (Oil palm is the name of the plant; palm oil, its product.) But, she says, “plantations can help increase people’s standard of living.”

For developing countries like Malaysia that are trying to grow their economies, the oil known as “liquid gold” holds special promise. Around the world, from Guatemala to Gabon, tropical rain forests are being replaced by plantations growing the orange-red fruits from which palm oil is extracted. Today oil palms cover almost 67 million acres—an area larger than New Zealand.

“It’s a fundamental driver of deforestation,” says Glyn Davies, WWF-Malaysia senior advisor. “Borneo—the world’s third-largest island, comprising the Malaysian states of Sabah and Sarawak, as well as Brunei and five Indonesian provinces—has lost 47% of its forest to palm oil in the past 20 years.”

“A fifth of Sabah,” Davies continues, “is now covered by a single crop, where wildlife-rich forests stood 40 years before.” And as forests have been cleared, animals like the sun bears and wild boars that Lang used to see have been robbed of their habitats.

But today Sabah is aiming to change this trajectory. Primed by local civil society, the state government has committed to meeting the highest standards for responsible palm oil production by 2025 using a pioneering “jurisdictional approach”—one that looks beyond individual plantations and strives for sustainability goals across the whole state. And WWF-Malaysia’s Living Landscapes program is contributing to this by bringing together diverse stakeholders in the key landscapes of Tawau, Lower Sugut, and Tabin; testing innovative approaches; and informing the statewide effort in the process.

A ubiquitous commodity

Malaysia is the world’s second largest producer of palm oil, after Indonesia, raking in about US$9 billion from the crop in 2018—nearly 3% of the country’s gross domestic product. Sabah has supplied up to 10% of annual global trade, estimated at over 70 million metric tons.

Driving palm oil demand are some 3 billion consumers across 150 countries. The edible vegetable oil is found in half of all supermarket goods and seven out of every 10 personal care products—everything from doughnuts to detergents, from ice cream to eyeliner. It’s used in animal feed and as a biofuel to power vehicles.

Palm oil has many desirable properties that are hard to find in any other single ingredient: It’s stable at high temperatures; resistant to spoilage; and able to smooth lipstick, make foods crispy, and lather up shampoos. “The truth is, there are few alternatives,” says Davies. “It’s a very versatile commodity. Plus, it’s an incredibly efficient crop.” A single acre can produce 1.3 tons of palm oil in a year. In comparison, soy and coconut yields are 0.2 tons and 0.3 tons, respectively. “So you would need four to 10 times the land area to get the same amount of other oils,” he says.

NEW GROWTH A worker plants elephant apple, a native species that bears fruit elephants enjoy, to help restore land that Sabah Softwoods Berhad oil palm plantation has set aside as a wildlife corridor.

With global demand continuing unabated and expected to reach a whopping $US88 billion in value by 2022, palm oil looks set to stay.

But when weighed in the balance, the costs of palm oil in a place like Sabah—to people as well as to forests and wildlife— have their own superlatives.

When tropical forests, with their protective canopies and lush understories, give way to the uniformly spaced monocultures of palm plantations, flooding and soil erosion increase. And when forests are cleared by burning, as they often are— though generally not in Sabah—harmful greenhouse gases are released, contributing to climate change and choking the air with smoky haze clouds. Human health suffers. For example, the deforestation-induced haze clouds from Indonesia’s 2015 planting season alone are estimated to have caused more than 100,000 deaths across Indonesia, Malaysia, and Singapore.

Deforestation has been linked to increased rates of tropical diseases as well. Sabah, in fact, has been called ground zero for a new form of zoonotic malaria, a disease transmitted by monkeys after forest loss. And Malaysia’s 1999 outbreak of the deadly Nipah virus emerged after huge numbers of bats were displaced from their forest habitats and forced closer to people and livestock.

But the challenges in palm oil production are not limited to the impacts of deforestation. For example, despite its contributions to economic growth, the industry has also been associated with poor wages and conditions for laborers, and in some cases serious rights violations, that must be addressed across the sector.

So if replacing palm oil isn’t an option, then the question is this: How do we produce it in a way that’s sustainable in the long run—a way that’s better for people, for threatened species, and for the forests that support them both? “We need to improve sustainable production through better labor and agricultural practices, and minimize further deforestation,” says Davies. “The key is finding a balance.”

WOODLAND WALK Elephants are a common sight in Sabah’s oil palm plantations. At Sabah Softwoods Berhad, WWF has guided efforts to reduce human-wildlife conflict, enabling these animals to roam safely between habitats while reducing crop loss.

In alignment

Helping Sabah find that balance is where Living Landscapes comes in.

“The idea,” says Nicholas Fong, who manages the program for WWF-Malaysia, “is to create a shared vision around balancing production with conservation, to analyze a landscape holistically and determine which areas would be most suitable for production, protection, or restoration.”

“The aim is to get diverse stakeholders to come together and agree on how to balance competing land-use needs,” he continues, “to talk through how we can produce palm oil but also have healthy rivers and protect our forests and wildlife.”

For example, Sabah has now developed a statewide map of high conservation value areas that can guide landscape-level planning and surrounding land use—including where and where not to expand palm oil production. In turn, WWF-Malaysia is convening district-level planners, oil palm growers, and representatives of civil society in several landscapes to test and codify these maps into district development plans.

“Ultimately, with the Living Landscapes program, we hope to inspire a new balance between people and nature and foster a culture where we protect forests, produce crops sustainably, and restore lands we have damaged.”
Glyn Davies
WWF-Malaysia Senior Advisor

WWF-Malaysia not only facilitates and participates in the discussions but also brings to the table technical information, such as elephant and orangutan surveys that can be guideposts for land-use planning. It’s a challenging process, Fong admits, because local governments, communities, producers, suppliers, and others often have different priorities.

“This is the DNA of a jurisdictional approach,” says WWF-US director of forests and climate Lloyd Gamble. “We need to be looking at ecosystem health at the scales at which ecosystems function. In jurisdictional approaches, we look to engage multiple stakeholders—government, private sector, civil society, and local communities—across an entire landscape to identify shared sustainability goals and then put planning, policies, and incentives in place to meet them.”

Getting stakeholders to the table can be its own challenge. But when it comes to palm oil, says Gamble, “responsible corporate buyers have already elaborated their own sustainability goals—around zero deforestation, climate, and nature or biodiversity—and their businesses ultimately depend on sustainable supplies.” By engaging with the Sabah government and facilitating the multistakeholder discussions, WWF can help suppliers understand and meet those buyers’ interests, better positioning themselves in a competitive marketplace.

To that end, WWF is working with a handful of global companies with a footprint in Sabah, including consumer goods giant Unilever. The British-Dutch multinational, whose products range from soap to snacks, committed to using only sustainably sourced oil by 2019 (and came within 0.4% of that goal). In 2018, Unilever backed Sabah’s ambition by committing to support the restoration of critical wildlife corridors and help hundreds of the company’s palm oil suppliers implement better growing practices.

Many corporations also have goals targeting improved labor standards and other issues that contribute to lower-risk business environments, says Gamble. “Increasingly, they want to do business in places where government takes these issues seriously.”

By supporting Living Landscapes and Sabah’s jurisdictional approach, Unilever aims not only to improve the sustainability of its own growers but also to foster a better business environment overall. Unilever joined HSBC Bank as an early leader in Sabah, and others have since followed suit.

“The bottom line here,” Gamble says, “is that businesses are responding to increasing global demand for sustainability in their supply chains. And this becomes a compelling reason for them to directly support ground-level strategies in the places their products come from, so we can jointly take on these sustainability issues at scale.”

Arni Mansur reviews homework with her daughter, Nurul Susilayanti, who attends school on the Sawit Kinabalu plantation compound where her parents work.

The colorful fruit that yields palm oil, the world’s most in-demand vegetable oil.

A worker harvests palm fruits in Tawau, Sabah, where oil palm plantations occupy a majority of the landscape.

A frog perches on a leaf in Tawau Hills Park.

Setting the standard

The good news is that Living Landscapes isn’t starting from scratch, especially when it comes to sustainable production. In 2015, Malaysia introduced a voluntary sustainability standard, called Malaysian Sustainable Palm Oil (MSPO), and subsequently mandated that all players in the industry, from plantations to processing facilities, meet the standard by 2019 in order to operate legally.

“It’s about taking care of people, planet, and profit,” says Nazlan Mohamad, the sustainability manager at Sawit Kinabalu. To attain certification, firms have to demonstrate they have effective management practices in place, transparent and traceable record keeping, and safe and fair working conditions. They also have to demonstrate environmentally friendly operating practices, such as using renewable energy where possible, maintaining the quality and availability of ground and surface water, and conducting soil and wildlife surveys prior to planting.

“We’ve been asked to take care of the environment more,” says Arni Mansur, who has worked as an herbicide sprayer at Sawit Kinabalu for over a decade. Sitting on a narrow wooden bench outside her company-provided accommodation, a well-ventilated concrete house fronted by a trimmed lawn, she gestures down the road to a row of brightly colored recycling bins. “We can’t throw rubbish in the river,” she says. “We used to sweep up the leaves that fall and burn them. But now we have to put them in bins, and a truck comes along to collect them.”

MSPO has already moved the needle on sustainable palm oil production in Malaysia. Now Sabah seeks to take it further, calling for all its oil palm stakeholders to meet the more stringent international Roundtable on Sustainable Palm Oil (RSPO) standard by 2025. This sets Sabah’s palm oil further apart on the international market.

Landscape spatial planning

Identifies suitable areas for production and restoration activities

Identifies where natural resources require protection

Informs smarter infrastructure development

The brainchild of WWF, Unilever, the Malaysian Palm Oil Association, and others, RSPO was established in 2004 to unite stakeholders, including palm oil producers, consumer goods manufacturers, and investors, in developing and implementing a global standard. Today RSPO certifies nearly 10.7 million acres, or roughly 16% of global palm oil production. Consumers can look for the RSPO symbol— palm fronds splayed out in a neat circle—and know that the product they are buying meets the industry’s highest social and environmental standards.

Twenty-six percent of Sabah’s total oil palm area is already RSPO certified, says WWF-Malaysia’s Fong, and there’s room for new areas to be certified.

Under RSPO, he explains, a landholder or company is required to identify areas of high conservation value on their land—areas that cannot then be converted to plantation. All told, it’s an expensive, technical undertaking.

And while that’s not a hurdle for large corporations with deep pockets, says Fong, it’s a cost that most of the state’s middle-sized growers—which account for more than half of Sabah’s total oil palm area—would struggle to meet.

To help more of them attain RSPO status, WWF-Malaysia is adopting a group-certification approach for small and medium-sized plantations. The move helps defray costs by grouping firms in the same location and supply chain. Members can support one another and attend training sessions together as well, explains Fong.

WWF-Malaysia is also helping growers by providing a platform to link buyers and their producers, working closely with colleagues in India and China, the largest global consumers of palm oil, to help growers understand the nature and quantity of demand. Additionally, the Sabah team invites Chinese and Indian buyers to witness responsible growing practices in action and meet the local government and growers.

But, says Fong, while RSPO is a vital piece of the puzzle in Sabah, certifying individual producers isn’t sufficient. Individual companies can meet the environmental criteria for riparian buffers and so on, but the conservation of wildlife and rivers isn’t confined to discrete production sites. “Animals like elephants and orangutans move across many sites, so for good wildlife and environmental management, we need neighboring plantation managers to work together to achieve better conservation outcomes,” says Fong.

That’s why the Sabah government is now partnering with RSPO and WWF to figure out how to get to statewide RSPO certification, and why WWF-Malaysia is piloting this more holistic land-use planning approach that integrates protection, production, and restoration.

PROUD PRODUCER Nazlan Mohamad is the sustainability manager at Sawit Kinabalu, a company that has been certified by MSPO, Malaysia’s standard for palm oil sustainability.

A shared space

To comprehend what it’s like to work on such a massive scale, it helps to see how varied a single landscape can be. Sabah Softwoods Berhad is a sprawling 148,000-acre oil palm plantation. Across undulating hills, the characteristic trees extend for miles. There are also rows of Eucalyptus and Albizia trees, introduced species that the company sells for wood chips and round logs.

But part of the estate feels different: The trees here don’t grow in neat, plantation-style rows, and they’re a mix of heights and species. Laran trees and napier grass grow chest- and head-high. Unlike in the palm plantations, the undergrowth is fairly thick, although the canopy cover is too sparse to provide relief from the unrelenting tropical sun.

Sabah Softwoods comprises industrial tree plantations, oil palm plantations, and a wildlife corridor. Native tree planting is now cofunded by Sabah Softwoods and Unilever. Covering 2,600 acres in an 8.7-mile stretch, the corridor was established in 2014 to connect two forest reserves, Ulu Kalumpang and Ulu Segama.

“The idea is to create a shared vision around balancing production with conservation, to analyze a landscape holistically and determine which areas would be most suitable for production, protection, or restoration.”
Nicholas Fong
Living Landscapes Program Manager, WWF-Malaysia

“This is the ‘restore’ part of the Living Landscapes program,” explains Fong. The corridor is at the heart of WWF’s vision for a thriving, shared space for people and wildlife. “It’s where we work with companies to connect fragmented forested landscapes so animals can pass through safely.

“It’s a big decision for companies to set aside land and forgo money they can make from crops,” says Fong. But for Sabah Softwoods the decision was a no-brainer.

The company used to have trouble with elephants destroying its crops, and in 2012 it approached WWF for help in tackling the issue. WWF carried out biodiversity surveys to identify elephants’ preferred routes. They also shared technical expertise regarding the soil and terrain, what native plant species to grow, and when to grow them—all in order to restore the corridor. For instance, advisers suggested planting fast-growing native trees such as laran and binuang first, followed by dipterocarps, which require more shade.

Eight years on, the impact has been tremendous, says Ram Nathan, Sabah Softwood’s senior manager for environment and conservation. “It’s helped reduce human-elephant conflict in our plantation areas,” he says, and the costs of crop damages fell nearly 100% from 2012 to 2018.

“And we see the presence of wildlife, especially elephants,” Nathan says, proudly noting that eight calves were born on the plantation in 2018. Although originally established to allow elephant movement, the corridor now serves multiple species, and there have been sightings of orangutans, sambar deer, and even sun bears.

“Ultimately, with the Living Landscapes program, we hope to inspire a new balance between people and nature and foster a culture where we protect forests, produce crops sustainably, and restore lands we have damaged,” says Davies. “A few brave successes will show what ‘good’ looks like, and we hope Sabah can become a model for other places that are critical for the ecosystem and wildlife.”

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