Ms. Tata intreviews Norman for Palm Oil Case Study

Palm Oil Case Study
03 March, 2009 - Singapore

1st interview with Norman Jiwan (NJ), head of the department of Social and Environmental Risk Mitigation at Sawit Watch

Interviewer: Renata Loew (RL), INSEAD

Introduction
1. RL: We are writing a case study in connection with the RSPO certification on sustainable palm oil. We will propose students to simulate a multi-parties negotiation and we want Sawit Watch to be one of the players, as a local social NGO. Of course, we are committed to have Sawit Watch approval before publishing anything with its name.

NJ: Okay.

2. RL: How many people work at Sawit Watch? How much it means in terms of covered area?

NJ: There are 15 people in the office and more 135 individual members who contribute with us on voluntarily basis. They work as informants, through mobile phone, and they deal directly with local communities that are affected by the palm oil industry.
Indonesia has 33 provinces and Sawit Watch has members from 17 of them. In the other 16 provinces, it is possible that social conflicts occur, but we are not aware of them because we don’t have members there.

3. RL: Does Sawit Watch have a close relationship with any organization?

NJ: Yes, you can’t work alone.
• Oxfam does capacity building and is also our donor.
• We developed some work with Friends of the Earth Malaysia.
• We have a close relationship also with Farmer Unions – we helped oil palm growers to set up this independent organization.

4. RL: Is the oil palm growers organization member of RSPO?

NJ: No, because they would have to pay €2.000. It is not so important for them.

Palm Oil supply
5. RL: How is Sawit Watch approach to oil palm smallholders?

NJ: Sawit Watch started as an investigation organization on problems related to oil palm plantations development. It was a group of activists from different organizations in Jakarta - human rights lawyers, indigenous organizations… Nowadays the main Sawit Watch beneficiaries are: palm oil workers, indigenous peoples and small holders, who we started working with in 2005. It is a learning period for us and often we have to use criteria to prioritize our activities, since we have a limited budget.
In 2004 the social group (Sawit Watch, Oxfam Novib and other NGOs) insisted that RSPO would not exclude smallholders. Later on, in 2006, the fist smallholders’ taskforce meeting took place. Already 20 smallholders attended the first meeting. The second meeting happened in 2007 and the third one in 2008. The contributions were very significant. Together with Forest Peoples I facilitate it. One challenge we had to face is that in Malaysia smallholders have bellow 50 hectares, while in Indonesia they have bellow 2 hectares – two very different contexts.

6. RL: What are the smallholders’ task force outputs?

NJ: They want to talk all about products. The meeting is good because we let them talk about all the problems and after we ask about the solutions. So, we receive contributions. The recommendations that so far received most attention from RSPO were for conflict-solution mediated by the RSPO and, in November 2008, pricing mechanism. There is also a Task Force report with 8 points - capacity building for small holders, certification protocol… I may send it you.

We count with the department of Agriculture participation in this working group. It is voluntary, so there is no need for an agreement and decisions are taken in consensus. Solutions and indicators are suggested and if you come up with alternatives that can be considered as indicator, they can be used. I think government still plays an important role.`

7. RL: Is palm oil a sustainable business?

NJ: You can’t claim it for all the players. They are progressing from different starting points. So far, conflicts with communities are increasing. We have a very simple indicator: number of incidences by year.
Biofuels
8. RL: What is Sawit Watch opinion regarding biofuels?

NJ: We have concerns about the effects of palm oil plantation for biodiesel because when demand increase out of control, the implications will be very serious. However, linking human rights violations in indigenous communities with biofuels consumption is possible only if you have a traceability system.
Additionally, Sawit Watch can’t say ‘yes’ or ‘no’ to biofuels because it will be a market decision. Since Indonesia only sells the crude palm oil, in the end of the day, it is about the agreements made between countries.
RSPO
9. RL: Is it possible to have a traceability system?

NJ: Yes, RSPO requires it for production and it must also be developed all through the value chain. So, in the end, you can say that 10% of certified palm oil is used in margarine, lipstick, biofuel… Though, certification is only for RSPO process (mill and plantation) – not for outside. So, buying certified palm oil may not be enough because you have to make sure where it comes from.

10. RL: If I buy certified palm oil, I expect that the system has checked everything. So why would a buyer have to make sure where it comes from?

NJ: You have to make sure that the claim “certified palm oil” is correct. Thus, you have to know exactly where it comes from. It is how the company may avoid a difficult situation in the future – minimize the risk.

11. RL: Is it enough to buy certified palm oil from a certain plantation to avoid reputational risks?

NJ: The company must buy palm oil from producers who are not involved in conflicts. So first it has to be able to prove that it buy only certified palm oil. After that, it cannot stop - things change and it has to keep improving.

12. RL: Are RSPO certified companies sustainable?

NJ: The problem is that companies don’t know exactly what is happening on the ground. The United Plantations case, for example. In Central Kalimantan, where problem were pointed by Greenpeace, they only received the management report [and it could have the wrong information].
RSPO is about checking the system, documentation and practice. Things may happen differently on the ground. Sustainable palm oil must go beyond RSPO standards. For us, it doesn’t matter if the plantation is going to be certified, what matters is doing things right. Because RSPO is a voluntary initiative, making producers do the right thing is a main challenge.

13. RL: What must change to allow companies to know where palm oil comes from?

NJ: RSPO has a good process, but the companies are already in a comfort zone. Changing practices and behaviors is difficult for them, it costs. So, the system is already there but companies need to comply with it. RSPO members should go beyond it.

14. Does the RSPO certification have credibility?

NJ: Yes, it does. Particularly if it is compared to others sectors. It is better than FSC standards.

15. RL: Will RSPO succeed with sustainable palm oil?

NJ: In this sense, we have to be optimistic and see things from the positive side.

16. RL: How is your relationship within RSPO?

NJ: It is good, nothing bad about it. Sawit Watch is a RSPO member because it feels considered there. Now it is time to challenge the implementation.
How you can prove a system is good? You have to check if it is working not only in principles, criteria and indicators, but how it satisfies people who is verifying it on experience.
Additionally, RSPO members have to behave under a code of conduct. So, when we find a problem with respect to a RSPO member, first we communicate it inside RSPO. We can’t expose him before it. It is not easy for Sawit Watch because we are a national organization - too close to the problem on the ground. Once we cannot put too much pressure on the member, it takes longer then we desire. It is bad for the communities we represent.

17. RL: How is Sawit Watch relationship with HSBC or other bank?

NJ: We are both RSPO members. I know they are involved with major investments in palm oil plantations in Indonesia and Malaysia where conflicts with communities are happening. In 2003 some banks did field trips to understand better what happens on the ground and then develop/ update palm oil investment policies. However, it doesn’t make difference in the reality – it’s like saying ‘I want to buy 100% certified palm oil’.

18. RL: How is Sawit Watch relationship with WWF?

NJ: We don’t have any formalized project together, but it is good. We worked together in the development of RSPO P&C and we have to support each other.

Environmentalists do not really care about the social issues, so we have to guarantee the social bottom line: respect for international and customary law; no involvement with forced and child labor; discriminatory practices; gender sensitive issues of violation, discrimination and harassment... WWF considers our inputs. They would like us to include global warming bottom line, but it is too hard to explain to the communities.

Eco-activism
19. RL: How is the relationship between Sawit Watch and Greenpeace?

NJ: It is very good. We cannot claim yet that RSPO is good because we can’t judge ourselves. So, Greenpeace is an independent organization who can do it.
The auditing is not independent enough because it is a RSPO fruit. You can claim that you have a democratic system, but you still need to check if it occurs in practice.

20. RL: Are Greenpeace and Friends of the Earth campaigns fair?

NJ: Greenpeace, Friends of the Earth and other independent NGOs, when they campaign, it is because there is something wrong. They are independent and responsible organizations.

21. RL: How did you reacted to the Greenpeace’s report “Burning up Borneo”?

NJ: I sent to RSPO Executive Board the table “Climate and biodiversity impacts of Unilever palm oil suppliers in Central Kalimantan” and asked for a response.