Frequently asked questions

Palm oil is a tropical vegetable oil that is produced from the fruit of the oil palm. Two different oils can be obtained from the fruit: palm oil from the flesh of the fruit and palm kernel oil from the seed. To extract the palm oil, the fruit is sterilised to deactivate enzymes and prevent the fruit spoiling, and is then pressed. This yields crude palm oil (CPO). The high carotene content gives the fruit and the crude oil an orange or reddish colour. To obtain palm kernel oil, the kernels are dried, partly crushed and then pressed. Palm kernel oil is solid at room temperature.

If palm oil is described as sustainably produced, it means that the oil palms have been grown and the oil produced in accordance with environmental and social criteria – relating to issues such as working conditions and observance of land-use rights – and that areas of high conservation value such as rainforests and peatlands have been protected against the uncontrolled expansion of oil palm plantations. This conserves biodiversity and ensures that land has not been converted, cleared or drained to make way for the oil palm plantations. Such land stores large amounts of CO2.

Palm oil makes products spreadable and so is particularly important in margarine, chocolate spread and other spreads. Moreover, palm oil is the only vegetable oil apart from coconut oil that is semi-solid at room temperature. This makes it suitable for products in which a hardened fat would otherwise have to be used. Palm oil has a major advantage over products such as butter: it has a very long shelf-life, which means that it does not become rancid so quickly. And butter is an animal fat, which renders it unsuitable for the growing number of people who adhere to a vegan diet. Another advantage of palm oil is that it is neutral in taste – in contrast to alternatives such as coconut oil, which usually contributes its own distinctive taste. Because it very stable when heated, palm oil is particularly suitable for baking, roasting and deep-frying.

The oil palm has the highest yield of all oil plants and it produces two oils that are useful to industry (Auf der Ölspur, WWF). In view of the world’s rising population, economic growth in the consumer countries – especially China and India – and the increasing demand for food, this high land efficiency means that palm oil plays a vital part in meeting the global demand for vegetable oils. Switching to other vegetable oils would simply displace the problems and give rise to similar issues in other countries – as is occurring with the clearance of rainforest for soybean cultivation in Brazil. The most important European vegetable oil, rape oil, would not be able to meet the rising global demand for plant-based oils.

Certification schemes such as RSPO and ISCC have drawn up rules, processes and criteria for sustainable palm oil. These seek to reduce and ultimately halt rainforest destruction, slash-and-burn and human rights violations in the palm oil industry. The sustainability criteria set by the certification systems are intended to ensure that the basic rights of indigenous landowners, local communities, plantation workers and smallholders and their families are respected and fully considered. However, deforestation cannot be halted by certification schemes alone. It is up to governments in the producer countries to enforce legislation on sustainable commodity production and to continue improving the legal position. In addition, production countries need help with capacity-building. Palm oil processing companies must also acknowledge their responsibility and ensure that their products do not contribute to further deforestation. Finally, it is also up to consumers to purchase only products produced to sustainable standards.

Certification schemes monitor and document the sustainable cultivation of oil palms and the sustainable production of palm oil. Certified sustainable palm oil can be traded as such, and products containing it can be labelled. Palm oil can be certified as sustainable through several international certification schemes, including the Roundtable on Sustainable Palm Oil (RSPO), ISCC, the Rainforest Alliance and the Roundtable on Sustainable Biomaterials (RSB).

The Roundtable on Sustainable Palm Oil (RSPO), which was set up in 2004, covers the entire value chain, including producers, commodity traders, the processing industry, retailers, banks, investors and non-governmental organisations. The aim of the RSPO is to act as a central organisation promoting sustainable methods of oil palm cultivation, thereby limiting damage to the environment. Its members support sustainable farming that contributes to the conservation of species diversity, reduces deforestation and respects the rights of smallholders and labourers.

RSPO’s criteria, which were drawn up in a multi-stakeholder process, cover compliance with local, national and ratified international laws and environmental standards relating to the management of land, water and waste and the use of pesticides. Another priority is the conservation of natural resources and biodiversity. Slash-and-burn is prohibited. After November 2005, no new plantations can be established in areas of primary forest or forests of high conservation value. In addition, independent studies of possible adverse impacts must be produced for all new plantations. Producers must respect the rights of local communities, comply with social and labour standards, and observe the ban on child labour and discrimination.

The International Sustainability & Carbon Certification (ISCC) standard is a certification scheme that goes further than the RSPO criteria in that it also demonstrates compliance with the requirements of the European Union’s Renewable Energy Directive (EU RED) and Germany’s associated sustainability ordinances on the use of biomass for energy. Development of the ISCC was supported by the German Federal Ministry for Food, Agriculture and Consumer Protection (BMELV) via the FNR, Germany’s central coordinating institution for research and development in the field of renewable resources, on the basis of a research project in which the private sector was involved.

The ISCC standard covers various criteria such as the protection of areas of high conservation value, sustainable land management, reduction of greenhouse gas emissions, the protection of soil, water and air and the application of good agricultural practices. Producers must also demonstrate that they implement good management practices, promote safe working conditions and consider social sustainability. Finally, compliance with relevant international treaties and national laws must also be proven before certification is granted. The Rainforest Alliance (RA) is a non-governmental organisation that developed its standard in the 1990s in cooperation with the Sustainable Agriculture Network (SAN). SAN is a coalition of non-profit, independent conservation groups which seek to promote environmentally and socially sustainable agriculture by establishing standards. The standard and its certification rules are developed and revised by the SAN Secretariat based in San José, Costa Rica. The purpose of the Rainforest Alliance's SAN Standard is to urge agricultural enterprises to analyse and subsequently reduce environmental and social risks that may arise from farm operations. The standard is based on three pillars: healthy environment, social equity and economic viability. 

In July 2020, the Rainforest Alliance introduced a new certification program that combines various requirements for sustainable agriculture and responsible practices along the supply chain.

The Roundtable on Sustainable Biomaterials (RSB) is a multi-stakeholder initiative that covers all types of biomass feedstock in every part of the world. It was known originally as the Roundtable on Sustainable Biofuels, which was established in 2007 by the École Polytechnique Fédérale de Lausanne (EPFL). On 1 January 2013 it was formally converted into an independent non-profit organisation based in Geneva, Switzerland, and on 18 March 2013 it changed its name to the Roundtable on Sustainable Biomaterials.

Membership of the RSB is open to producers, companies, NGOs, governments and inter-governmental organisations. The standard was devised in accordance with the ISEAL Code of Good Practice for Setting Social and Environmental Standards. The RSB is the only international initiative to develop an international standard and certification system for biomass and biofuels. In practice, only a very small amount of palm oil is certified by the RSB.

Auditing under both the RSPO standard and the ISCC system is carried out by independent certifiers. This is an elaborate process that involves local interest groups in the various processes. Plantations and facilities are inspected to check whether they comply with the criteria specified by the scheme. The separation between the certification scheme and the independent certifiers who perform the audits serves to ensure compliance with the criteria for sustainable palm oil production.
Information about the various certification bodies can be found on their websites: www.rspo.org, www.iscc-system.org, http://san.ag/ oder http://rsb.org/.

The RSPO criteria lay down a tight framework within which producers must operate. Nevertheless, there are grounds for some criticism of RSPO, and FONAP and many of its members are addressing these points on an individual basis. However, RSPO certification of sustainable production has been shown to have direct positive effects.

The GIZ project ‘Sustainable Palm Oil Production in Thailand’ (2009-2012), which was funded by the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU), helped smallholders work towards RSPO certification. Rigorous attention was paid to safety measures in connection with the use of pesticides. As a result of higher yields and the premiums that quality and sustainability attract, the smallholders’ incomes rose by up to 50 per cent. There were also positive impacts on biodiversity in the plantations, with owls and other birds returning to these sites. This example shows that palm oil production to RSPO standards can be sustainable, benefit smallholder agriculture and contribute to a diverse agricultural landscape.

In the project “Sustainable and Climate-Friendly Palm Oil Production and Procurement (SCPOPP)”, which is also financed by the BMU, palm oil producing smallholders are supported through extensive training courses in getting certified according to an internationally recognized standard.

However, it is also clear that there is a need for further improvements to the certification standards and the way in which they are implemented. FONAP continues to work on improving both the RSPO and the ISCC.

RSPO and its members are constantly discussing where improvement is needed and how it can be achieved. The suspension of the IOI Group in 2016 shows that RSPO is willing to contribute to greater transparency and to clamp down harder on any failure to comply with standards and criteria – although the process is criticised for being too slow.

The Forum for Sustainable Palm Oil is actively involved in improving existing certification schemes. The adoption of a FONAP resolution at the general assembly of RSPO demonstrates that certification schemes are open to improvement. Members of RSPO have in the past flouted the rules by converting areas of high conservation value (HCV). Companies that cleared land after 2005 without the HCV audit required by RSPO could submit a compensation plan and have these areas certified retrospectively. However, it was unclear which land and how many specific areas were actually affected by this. At RSPO’s general assembly in 2016, the Forum for Sustainable Palm Oil successfully put forward a resolution aimed at improving the transparency of the certification system. In future members must disclose whether they have converted any rainforest areas into plantations since 2005 and if so, how they have provided compensation.

In addition, a number of companies have joined forces with Greenpeace and WWF in the Palm Oil Innovation Group (POIG) in order to express their dissatisfaction with what were perceived as RSPO’s overly lax criteria. POIG encourages voluntary adherence to additional criteria.

As a result of pressure from some members, RSPO itself has also introduced voluntary add-on criteria for sustainable palm oil production. RSPO NEXT aims to do more to combat deforestation and greenhouse gas emissions and to uphold human rights. This voluntary initiative for RSPO members goes beyond the current RSPO criteria.

In 2018, the RSPO revised its certification standard (RSPO P&C) after an 18-month revision process. A smallholder standard is also being developed. In the major producer countries such as Indonesia and Malaysia, smallholders account for around 40 percent of palm oil production. FONAP accompanied this process closely as representation of the consumer goods sector and participated in five rounds of negotiations.

This is correct. All the available certified palm kernel oil is physically purchased, but there is demand for only about 50 per cent of the certified palm oil. Producers criticise the purchasers for this and question whether further tightening of the criteria is acceptable in view of the limited demand. However, the commitment signed by FONAP members shows that European purchasers want sustainable palm oil.

Unlike the Roundtable on Sustainable Palm Oil (RSPO) and the International Sustainability & Carbon Certification (ISCC) scheme, the Forum for Sustainable Palm Oil is not a system of standards. FONAP is a voluntary initiative whose members have undertaken to use only sustainably produced palm oil and palm kernel oil. To enable members in the German, Austrian and Swiss markets to comply with the FONAP commitment, FONAP recognises palm oil certification performed by RSPO, ISCC, the Rainforest Alliance (SAN standard) and RSB. However, many members consider that the criteria defined by these systems do not go far enough. As set out in its rules, FONAP’s primary aim is therefore to improve the existing standards. Further information on the work of FONAP and its aims can be found here.

Further information about sustainable palm oil and the various standard systems, together with details of studies that have been conducted, can be found on the websites of the various certification schemes such as ISCC, RSB, the Rainforest Alliance and RSPO. Non-governmental organisations such as WWF and Brot für die Welt and institutes such as Südwind also address issues relating to sustainable palm oil and the possibilities and limits of certification schemes.