Episode 48 - Chocolate with Samantha Luc

February 08, 2021 by Kristen Pue

For this episode we were joined by Samantha Luc to talk about chocolate. Samantha is a former professional chocolate eater! She used to be the Head of Traceability and Tastings and Education at Soma Chocolatemaker. Now she is working with companies across a variety of industries to support their traceability efforts with Wherefour ERP.

Here are Kristen’s research notes in preparation for this episode.

Chocolate: The Basics

The essential ingredient in chocolate is fermented and roasted seeds of the theobroma cacao tree.[1] 90% of the world’s cacao is grown by 2.5 million farmers working 5-10 acre family plots.[2]

Today, most of the farms are in Western Africa.[3] The top four cocoa producing countries are all in Western Africa: Côte d’Ivoire, Ghana, Nigeria, and Cameroon. That is due to an increase in cocoa production in Western Africa, while chocolate production has remained stable throughout most of the world. The market share of Western African cocoa has increased from 55% to 74% since 1990. And in particular, Western Africa is a major supplier of ‘bulk cocoa’, as compared with fine or flavour cocoa. Western Africa produces more than 80% of bulk cocoa.

Once cacao beans are harvested, they are fermented, dried, roasted, crushed, and ground into cocoa powder.

History of Chocolate

Chocolate has been consumed since at least 1500 BC. It originates in Meso-America, where it was initially consumed by the Olmec, and later the Maya and the Aztec, as a drink (xocolatl, or bitter water). Chocolate was used as a currency and in rituals.

Much like sugar, chocolate was at first reserved for the elites in Europe.[4] In the mid-1800s, aided by technological innovation, chocolate started to become a product consumed by mainstream Europeans.[5]

Around that time there was also invention of the chocolate bar, which is how we mostly think about chocolate today. The first chocolate bar was made and sold by Fry and Sons in 1847 and in 1875 Henri Nestlé developed milk chocolate.

And in order to increase crop yields, cacao production shifted from the criollo variety to the forastero, which is dominant today.[6] Criollo cacao is typically seen as better tasting, but forastero cacao is easier to grow and produces a higher yield. (However, there is some dispute about this and cacao varieties can taste quite different depending on where they are grown).

People and Chocolate

Chocolate and Colonialism

Chocolate production and colonialism are inextricably connected. Chocolate was brought to Europe by Christopher Columbus. And colonialism changed the geography of chocolate production. The expansion of cacao production, especially in the 20th century largely occurred in Western Africa rather than Central and South America, where cacao trees are native.

The first large scale production of cacao in Africa began in the Portuguese plantations found on Sao Tome and Principe. Colonial governments were often responsible for coercion and dangerous working conditions on cacao plantations.

Cocoa Producers and Poverty

Since the 1980s, the average cocoa price has halved (adjusted for inflation). This is a problem because low prices push cocoa producers into situations of poverty.

In Ghana, cocoa is supply managed through a managing board called Cocobud, which buys all of the cocoa and sells it at a fixed price. Côte d’Ivoire liberalised under pressure from the IMF in the 1990s, but is now starting to re-regulate prices. Both countries have agreed to a minimum export price of $2,600/tonne, which a ‘Living Income Differential’ of $400/tonne to be used to guarantee that farmers receive about $1,800/tonne. Although this is good news, $2,600/tonne is about the same price farmers received before the cocoa price collapsed in 2016 – and back then cocoa farmers’ average incomes were below the $2.40 per day threshold for extreme poverty.

Child Labour

Child labour is endemic to cacao production in Côte d’Ivoire and Ghana. A survey done by researchers at the University of Chicago and commissioned by the US Department of Labor, 45% of children living in agricultural households in cocoa growing areas were engaged in child labour. Child labour in cocoa has actually increased by an estimated 14% in the last decade.

Environment and Chocolate

Deforestation is a huge global issue: in 2017, for example, 40 football fields worth of tropical forest were lost every single minute. This isn’t all from chocolate, but I think it’s important to put deforestation in context.[7] About 40% of Ivorian cocoa is estimated to have come from inside protected forest areas (making it illegal).

Challenge

Kristen’s Challenge

My ethical chocolate is a Camino brand dark hot chocolate mix that I bought from my local waste-free grocery store. All of its ingredients (except sea salt) have organic certification, Fairtrade Certification or both. The cocoa is from CONACADO (the National Confederation of Dominican Cacao Producers), which is an organization of small-scale cacao producers in the Dominican Republic. The sugar is from a worker co-operative in Paraguay called Manduvirá.

Camino is a brand that’s run by an Ottawa-Gatineau-based co-operative called La Siembra. They were North America’s first importers of Fairtrade Certified cocoa and sugar. La Siembra see themselves as “100% fair-trader[s]”. They use Fairtrade Certified ingredients in all of their products, and they aim to build direct relationships with small-scale co-operative producers as much as possible. They are also supporting a new fair trade certification called SPP (the Small Producers Symbol), which is the first fair trade farmer-owned certification system and is seen as a more robust fair trade standard.

Endnotes

[1] Secret Life of Chocolate. Part 1: Origins. (6 December 2020). The Food Programme, BBC Radio Four.

[2] How Chocolate Works. (19 November 2013). Stuff You Should Know Podcast.

[3] “How Chocolate Works”, Stuff You Should Know.

[4] “Secret Life of Chocolate. Part 1: Origins”, The Food Programme.

[5] “Secret Life of Chocolate. Part 1: Origins”, The Food Programme.

[6] “Secret Life of Chocolate. Part 1: Origins”, The Food Programme.

[7] Chocolate and Sustainability. (18 November 2019). Business Wars Podcast.

Episode 33 - Carbon Offsets

July 26, 2020 by Kristen Pue

What Are Carbon Offsets?

Carbon offsets compensate for emissions by financing emissions-reducing projects somewhere else in the world. So, to take an example from Umair Irfan’s Vox article: let’s say a steel mill wants to reduce its emissions. Rather than waiting years to install new zero-emissions technology, the steel mill could start mitigating its emissions immediately by buying carbon offsets.

Types of projects

Deforestation prevention
Renewable energy projects, biogas projects
Methane capture
Energy demand projects: energy efficiency, like distributing efficient cookstoves

The cost of carbon offsets varies, but typically the price is around $12 USD/tonne of CO2 offset.

For context, a flight from Toronto to Vancouver generates about 0.6 tonnes of carbon. I used the Less Emissions calculator for my upcoming Ottawa – Edmonton roundtrip flight, and it came out to 1.1 tonnes of carbon, which cost $27 CAD to offset through a Gold Standard-certified international offset project (there was a cheaper option available but it was CSA-Standard Certified). The Carbonzero calculator estimated 1.45 tonnes for the same flight path, so I’m not sure what accounts for the difference there.

The average Ontarian uses about 11 tonnes of carbon annually. Half of that total comes from driving a car (2.2 tonnes), home heating (1.7 tonnes), air travel (1.4 tonnes), and eating beef (0.5 tonnes).

As a consumer, you can also buy some goods and services that include carbon neutrality as part of the price.

Who Does Carbon Offset Projects?

It’s a combination of businesses and NGOs.[1]

Who Is Using Carbon Offsets?

Globally, there is about $300 million per year in sales of voluntary carbon credits, trading almost 100 million metric tons of carbon.

The compliance offsets market (the market for carbon credits used to meet legally binding caps on carbon in schemes like the EU’s Emissions Trading System) is much larger, at somewhere between $40 billion and $120 billion.

Heavy emitters lean on carbon offsets more than other industries, because it is more difficult for them to decarbonize without a fundamental change in their business models – so, sectors like agriculture, aviation, and oil and gas.[2] Airlines are among the most vocal sectors on using emissions offsets.[3]

There is over 100 markets for carbon offsets already.[4] A lot of carbon offsets are built for compliance markets – so that companies can meet emissions targets when there is something like a cap and trade system in place.[5] For example, California’s cap-and-trade program allows companies to offset a small percentage of their carbon output with forest preservation projects in North America. The three biggest markets for carbon offsets are China, India, and the US.[6]

Consumers buy offsets, often by clicking the option when buying an air ticket. But others will purchase offsets as part of a commitment to carbon neutrality or to offset big carbon expenses like air fare. Governments also buy carbon offsets. For instance, Norway is the world’s largest supporter of the REDD scheme.

Major Carbon Offset/Credit Schemes

There are at least three United Nations schemes. The largest carbon offset scheme is the Clean Development Mechanism, a program that came out of the 1997 Kyoto Protocol. The Clean Development Mechanism has a poor track record of meaningful reductions in emissions.

Joint Implementation is the other offsetting mechanism under the Kyoto Protocol. It enables countries with emissions reductions commitments to generate Emission Reduction Units (ERUs) and to transfer them to other countries. Joint Implementation is responsible for issuing one-third of all Kyoto offset credits. There are serious weaknesses with JI.

Then there is also the UN Reducing Emissions from Deforestation and Forest Degradation (REDD). And a UN Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) will start in 2021.

There are other government-run schemes, such as the California Air Resources Board forest standard and new tropical standard. Canada is planning to establish an offsets market in the future. And there are a bunch of private carbon offset companies, such as Less and Carbonzero.

Principles of Good Carbon Offset Programs

From a positive point of view, carbon offsets put a price on pollution. Which can be a good thing and is the justification behind carbon taxes and other market-based climate policies.

For carbon offsetting to address climate change, there are several things that offsetting schemes must accomplish: additionality; third-party verification; permanence; avoiding leakage; social and environmental safeguards; and offset limits.

Additionality

It is important that carbon offset projects are effective, but that is not enough. That’s why carbon offsets experts talk about something called additionality. Additionality means asking: would this have happened anyway? Is the revenue from carbon offsetting actually supporting brand new decarbonization efforts? You have to be able to count reductions that wouldn’t have happened otherwise.

Additionality is the biggest measure of quality in a carbon offsetting project.[7] Clean energy projects have low additionality. Renewable energy projects already generate renewable energy certificates and they already have subsidy support. Although clean energy projects are the lowest quality type of carbon offset project, they are the biggest category of carbon offsets.[8]

You can much more directly claim additionality for reforestation projects (tree-planting).[9] Energy demand projects also have high additionality – that is things like clean cookstove distribution and energy efficiency projects.[10]

Some offset providers guarantee emissions savings, which essentially means that if the emissions savings don’t occur or if they turn out not to be additional the provider would make up the loss with another project.

In 2015 a French study found that 37% of REDD projects overlapped with existing protected lands like national parks.

Measurement and Third-Party Verification

Like with any social or environmental standard, you want to ensure that the standards are being verified by third-party auditors. Measuring emissions savings can be tricky. Some projects are much more difficult to measure than others. A methane capture project simply involves installing a sensor at, say, a coal mining operation. For forestry projects, you have to use satellite imagery to make sure that tree is still standing year after year. That’s difficult and expensive to do.[11]

Permanence

Permanence means: if you reduce the carbon with this project, is it going to stay sequestered? This is one of the main critiques of reforestation offsetting projects. Forests could be cut down or destroyed before emissions reductions have been generated. If you cut down a tree before 100 years, all of that carbon gets released into the atmosphere.[12]

Avoiding Leakage

Leakage refers to a situation where emissions reductions in one area result in greater emissions somewhere else. For example, forest protection somewhere could lead to logging somewhere else.

Social and Environmental Safeguards

Carbon offsetting should have safeguards to ensure that the project isn’t harming communities or undermining other environmental objectives. Without these safeguards, carbon offset projects can have negative impacts on local populations. For instance, a windfarm project displaced local farmers and didn’t generate the expected amount of power. And a 2015 green dam project in Guatemala was linked to the killing of six Indigenous protesters, two of which were children. That project is funded by the World Bank and will produce tradeable carbon credits.

Problems with Carbon Offsetting

The biggest problem with carbon offsetting is that a lot of projects fail to meet the principles described above. In particular, most carbon offset projects fail to meet the standard of additionality. But here are a few other common critiques.

Measurability and Pricing

Measurability issues can drive up the price of a carbon offsets project. As a result of measurability issues, reforestation projects – which are some of the potentially most effective projects from a sequestration perspective – are largely left out of carbon offset schemes.

Is this a Racket? A Scam?

Opaqueness of pricing of carbon offset projects undermines the legitimacy of the whole market. Companies have an incentive to choose a baseline scenario with inflated emissions, and that has occurred.

There is also evidence of fraud, exaggeration, and double-counting. In some cases, projects never get carried out – such as the example of a tree planting project in Panama. The carbon offsetting market continues to improve. While a decade ago, carbon offsets were a “wild west”, today there is a bit more structure.

Still, though, emissions reductions are overestimated in about 85% of offsets projects. Only 2% of projects have a high likelihood that emissions reductions are additional and are not over-estimated.

Moral Hazard

The climate advocate George Monbiot famously compared carbon offsets to indulgences in a 2006 Guardian column. His point was basically that carbon offsets make consumers and businesses complacent about the need to reduce our consumption. From that article:

“Any scheme that persuades us we can carry on polluting delays the point at which we grasp the nettle of climate change and accept that our lives have to change. But we cannot afford to delay. The big cuts have to be made now, and the longer we leave it, the harder it will be to prevent runaway climate change from taking place. By selling us a clean conscience, the offset companies are undermining the necessary political battle to tackle climate change at home. They are telling us we don't need to be citizens; we need only to be better consumers.”

One thing that I think is pretty funny about this comparison is the fact that the Vatican used carbon offsets to declare itself the “first carbon-neutral sovereign state” in 2007. (Of course, the project they paid for never actually got done, so…)

There is also a cheeky site called CheatNeutral that pokes fun at carbon offsets by allowing you to be infidelity neutral by funding someone else to be faithful.

Some people have taken aim at these analogies. David Roberts at Grist has said the following about the indulgences comparison:

“If there really were such a thing as sin, and there was a finite amount of it in the world, and it was the aggregate amount of sin that mattered rather than any individual's contribution, and indulgences really did reduce aggregate sin, then indulgences would have been a perfectly sensible idea.”

But there is still the question of whether people (and businesses) use offsetting as a way to avoid changing other behaviours.

Reliance on Capitalism/Market Solutions

This argument is basically:

“Look, I think that we should save forests. Totally agree that we should save forests. I just don’t think that we should use capitalism to save forests. I don’t understand why everyone wants to use capitalism for everything.”[13]

Incrementalism

Carbon offsets can’t actually reduce emissions. At best, all they do is cancel out emissions that have already been produced. That can be a good thing, but when you take into account time horizons it is actually a big problem. Some offset projects – tree planting, for instance – can take decades to have emissions saving effects, if they ever do. And given the lock-in effects of climate change, not to mention the risk of run-away climate change, it might all be too little, too late. Carbon offsets have been around for decades, yet emissions are still increasing.

Low-Hanging Fruit

Offsets are cheap in part because there are lots of ways to reduce emissions very inexpensively. We could refer to these as quick wins. But what happens when the low-hanging fruit of emissions savings are used up?

Carbon Offset Certification Schemes

One way to ensure that you are buying carbon offsets that adhere to the principles set out above is to get offsets that adhere to a respected certification standard.

Voluntary Gold Standard

Voluntary Gold Standard (VGS) -certified offsets are audited according to the rules set out in the Kyoto Protocol. The Gold Standard is the highest global standard for carbon offsets. It’s the standard that the David Suzuki Foundation recommends using if you are going to buy carbon offsets.

Voluntary Carbon Standard

Voluntary Carbon Standard is the world’s most widely-used voluntary emissions certification program.

Other Third-Party Verification

Here are a few other third-party offset verification standards:

CSA Standard-Certified Canadian Offsets
Green-e
American Carbon Registry
Climate Action Reserve
Climate, Community, and Biodiversity Standard
Verra
Rainforest Alliance

Should I Use Carbon Offsets?

For people and businesses, carbon offsetting should be a final lifeline: it should be something you do after you have done everything reasonable to reduce your emissions.

For example, the sustainable shoe brand Allbirds has a three-step approach to carbon neutrality.

Measure emissions across the supply chain, including product end of life. They include a carbon score with all of their shoes. For instance, the runners that I bought this year from them have a footprint of 9.0 kilograms of carbon (which is below the average of 13.6 kilograms for running shoes generally).
Reduce the carbon impact.
Offset anything that’s left.

That is generally the way companies should approach offsets. (As a quick note: while Allbirds is well-rated for environmental sustainability and animal welfare, Good On You has pointed out serious weaknesses in its labour practices.)

You should be extremely skeptical of any company that is using offsets as the main approach to sustainability. For example, a BBC investigation calculated that in order to offset the annual emissions of Ryan Air (which is positioning itself as the greenest airline), you would need to plant enough trees to cover 12% of the UK.[14]

As an individual, I would liken carbon offsets to donating to charity. It doesn’t get you out of your core ethical responsibilities, but you can use it to improve your overall moral contribution. Buy carbon offsets only where there are no feasible green alternatives (e.g., important long-distance air travel).

You can justifiably use carbon offsetting as a way to cut your overall footprint or as an incentive to be greener – like a self-applied carbon tax. But you may as well just donate to your favourite environmental group. In the episode, Robert makes the good point that our society’s obsession with measurement can get in the way of impact.

The real criticisms with carbon offsets come from businesses that use flawed offsets programs to meet government emissions standards.

Which Carbon Offsets Should I Buy?

Buy certified offsets, preferably from a standard with a registry of projects. Less.ca has several options for certified offsets and you can see the projects associated with them. This was also the top-rated offset program in a David Suzuki report (though it’s over a decade old now). Make sure the project is registered – that ensures that offsets are only sold once. Another suggestion is to choose projects that specifically help the world transition away from fossil fuels.

Endnotes

[1] Switched On Podcast. 19 May 2020. When Enough’s Not Enough, Try Carbon Offsets. Switched On Podcast.

[2] Switched On Podcast, “When Enough’s Not Enough.”

[3] Switched On Podcast, “When Enough’s Not Enough.”

[4] Switched On Podcast, “When Enough’s Not Enough.”

[5] Switched On Podcast, “When Enough’s Not Enough.”

[6] Switched On Podcast, “When Enough’s Not Enough.”

[7] Switched On Podcast, “When Enough’s Not Enough.”

[8] Switched On Podcast, “When Enough’s Not Enough.”

[9] Switched On Podcast, “When Enough’s Not Enough.”

[10] Switched On Podcast, “When Enough’s Not Enough.”

[11] Switched On Podcast, “When Enough’s Not Enough.”

[12] The Energy Gang Podcast. 2019. The Problem with Carbon Offsets. The Energy Gang Podcast.

[13] The Energy Gang Podcast, “The Problem with Carbon Offsets.”

[14] BBC Panorama. 11 November 2019. Can Flying Go Green? BBC, https://www.youtube.com/watch?v=mPhOS4uXkmM&feature=youtu.be.

Episodes 26, 27 and 29 - Palm Oil

June 15, 2020 by Kristen Pue

What is Palm Oil?

Palm oil comes from the fruit of oil palm trees (elaeis guineensis). Palm kernel oil comes from crushing the kernel (the stone in the middle of the fruit). 66 million tons of palm oil is produced annually, making it the most commonly produced vegetable oil. Global production of palm oil has doubled in the last decade. Palm oil plantations cover more than 27 million hectares of the Earth’s surface.

There are approximately 200 alternate names for palm oil and palm oil derivatives used in cleaning products and cosmetics, which can make it really difficult to know if there is palm oil in what you’re buying.[1]

But here’s a trick: there are four root words that give you an indication that an ingredient might be palm oil-derived (but not necessarily so):

Palm-

Palm kernel oil
Palm fruit oil
Palmate
Palmolein
Palmitate
Palmitic acid
Palmityl alcohol
Hydrated palm glycerines
Etyl palmitate

Stear-

Sodium stearate
Stearic acid
Pentataerythrityl tetraisostearate
Octyldodecyl stearoyl stearate

Laur-

Sodium lauryl lactylate
Sodiul lauryl sulphate
Sodium laureth sulfare

Glyc-

Glyceryl
Hydrogenated palm glycerides

But there are a bunch of palm derivatives that don’t use these roots (e.g., sodium kernelate, elaeis guineensis) and sometimes palm oil can be labelled more generically, as vegetable fat or vegetable oil. Here is a list of 25 sneaky names for palm oil. If you live in an EU country, palm oil can’t be labelled as a generic vegetable oil.[2]

More than 50% of packaged supermarket products contain palm oil. Palm oil is in:

Packaged foods like pizza (dough), doughnuts, chocolate, margarine, noodles, ice cream, bread, chips, cookies. It’s used where you need fat of some kind.
Personal care products and cosmetics like deodorant, shampoo, toothpaste, and lipstick. Some cleaning products also.
Animal feed
Biofuels

It is also a popular cooking oil in Asian and African countries. 40% of the world’s palm oil is consumed in China, India, and Pakistan.[3] The food industry used about 72% of all palm oil, cosmetics/cleaning take another 18%, and the remaining 10% goes to biofuels and animal feed.[4]

Why is Palm Oil in Everything?

Palm oil has a lot of useful properties. It is semi-solid at room temperature, so it can keep spreads spreadable. It is resistant to oxidation, so it can give products a longer shelf-life. It is stable at high temperatures, so it helps give fried products a crispy and crunchy texture. And it is odorless and colourless, so it doesn’t alter the look or smell of food products.

Palm oil is also used in some products for its health properties. Palm oil doesn’t have trans-fat and has a lower saturated fat concentration than butter. Other vegetable oils have to be partially hydrogenated to make them more solid, but that process of artificial hydrogenation creates trans-fatty acids.[5] Palm oil is naturally hydrogenated. When scientific consensus was forming around trans-fats, Unilever led the shift to palm oil in food products.

Palm oil and palm oil derivatives also replaced animal-based fats in foods, as well as cleaning and personal care products (E.g., soaps with animal tallow[6]). Palm oil and palm kernel oil possessed the same properties as animal tallow, which made them the only suitable plant-based alternative.[7] Consumers were already pushing the market toward plant-based alternatives, but the BSE outbreaks in the late 1980s and early 1990s triggered a larger shift toward palm oil.[8] The consumption of animal fats per capita reached its peak in the 1980s and has been in decline since.

Palm oil is also cheap because it’s a productive crop and because oil palm trees demand less work and production inputs than other oil crops. For that reason, it is a popular cooking oil in Asian and African countries.

Where is Palm Oil Produced?

Oil palm trees are native to West Africa but were brought to Southeast Asia in the 19th century. Malaysia and Indonesia produce 87% of global palm oil. However, there are 42 other countries that also produce palm oil. That includes countries in West and Central Africa, Southeast Asia, and Central and tropical South America.[9]

Palm Oil Production

Oil palms are grown and harvested on large-, medium-, and small-scale palm oil plantations.[10] The palm oil industry is dominated by about a dozen corporations that operate large-scale plantations and mills.[11] The three largest players – Musim Mas, Wilma, and Sime Darby, account for 25% of palm oil production.[12] (While these are big multinationals, they are small in comparison to the biggest agribusiness corporations, the “ABCDs”, which are headquartered in western countries). There are at least a million small-scale oil palm producers in Indonesia alone.[13]

Oil palm trees grow up to 20 metres tall and have an average life span of 25 years. They start to bear fruit after three years and reach peak production between years 6-8. Fruit bunches can contain from 1-3,000 individual fruits, which are the size of small plums. The bunches weigh 10-25kg. Harvesting palm fruit is physically demanding. Harvesters use long steel poles with a sickle at the end to cut the palm fruit bunches down. The bunches are then loaded onto wheelbarrows and taken to collection points.

Like sugarcane, oil palm fruit has to be processed quickly after harvesting – within 24 hours. For this reason, palm oil refineries are usually situated within-country.

Environment

Deforestation

Palm oil is a major driver of deforestation. For instance, approximately 55% of newly developed palm oil plantations in Malaysia and Indonesia from 1990-2005 resulted in deforestation.[14] As the palm oil industry expands, the space for new palm oil plantations is often made through deforestation and peatland clearing.

Palm oil is currently responsible for about 8% of deforestation – that’s a big chunk of the 53% of deforestation caused by agriculture. But keep in mind that 24% of deforestation is from land used for livestock, while 19% is coming from soybeans (which are mostly going to feed animals) and 11% from corn (same). So, if we are looking at changing one consumption practice to counter deforestation, palm oil isn’t the place to start.

And even in the big palm oil producing countries like Indonesia, land clearing for pulp, paper, and timber is a bigger source of deforestation.

However, the forests that are being cleared for palm oil plantations are in some cases particularly biodiverse or particularly efficient carbon sinks. Indonesian forests store even more carbon per hectare than the Brazilian Amazon. Some Indonesian forests are called “peatlands”, which are low-lying rainforests located close to coastal areas. The peat is under the forest, and it is basically a below-ground accumulation of decayed vegetation. It was formed in swampy conditions where plant material fails to fully decay and can build up to a depth of 10 metres or more over thousands of years.

The peat lands are an immense source of stored carbon. They can store up to 20 times as much carbon as tropical rainforests on normal mineral soils. As the forests above them are deforested, those sinks are released – making for something some have called a “carbon time-bomb”. Also, as the industry expands there is concern that its impact on deforestation could increase.

And palm oil could be less destructive. Deforestation could be reduced or avoided by planting in areas that are already deforested.

Biodiversity Loss

This problem is connected to the problem of deforestation and other land conversion for palm oil plantations. Palm oil expansion could affect 54% of threatened mammals and 64% of threatened birds globally.

Some of the species threatened by palm oil expansion include the cotton top monkey, the chimpanzee, Sumatran tigers, African forest elephants, orangutans, gibbons, sun bears, kangaroos, and cassowaries. For example, 10,000 of the estimated 75-100,000 critically endangered Bornean orangutans are currently found in areas allocated to palm oil.

In addition to the loss of direct habitat, palm oil plantations can increase human-wildlife conflict with species like orangutans and tigers. Each year 750-1,250 orangutans are killed during human-orangutan conflicts, often linked to expanding agriculture.

A Jakarta-based ecologist has referred to palm oil plantations as “green deserts” because they are monocultures. While these are plants, palm plantations in Southeast Asia are an introduced species that does not interact very well with local ecology, so very little biodiversity exists within them.

Unfortunately, boycotting palm oil is likely to displace rather than halt biodiversity loss because it would increase the production of other oil crops. So the International Union for Conservation of Nature (IUCN) and WWF prefer to push for palm oil sustainability, rather than a boycott or ban of palm oil.

Sustainable palm oil would involve putting an end to the clearing of native tropical forests for new palm oil plantations, and limit demand for palm oil for non-food uses. It would also ask existing palm oil plantations to manage their land responsibly by setting aside forest and other areas identified as important for biodiversity and carbon.

Climate Change

Oil palms are a very productive plant. One of the reasons it was produced initially was environmental sustainability: because palm oil is so productive, you need less land to grow it.

The problem here is land conversion. Forests and peat lands are carbon sinks. When these lands are converted to palm oil plantations, it results in the release of greenhouse gases. As well, we lose those carbon sinks. Indonesia’s peatlands have gone from a carbon sink to a globally significant source of emissions thanks to deforestation. Oil palms do absorb carbon dioxide, but less effectively than forests.

Also, fire is used to clear lands for palm oil plantations, which emits GHG in addition to creating air pollution. 80% of the fires in Indonesia in 2019 were being set to clear land for palm oil plantations.

The challenging thing here is that oil palm production is more productive than substitute crops. And substitutes like coconut oil have their own environmental problems. We would likely have to convert even more land to keep up with demand.

Chemicals Use and Pollution

Palm oil plantations use a range of pesticides and herbicides, as well as large amounts of fertiliser. These products can pollute soil and groundwater. Although palm oil plantations aren’t large users of pesticides and fertilizers overall, these chemicals are often used indiscriminately – which can result in water pollution.

These chemicals also pose a risk to the people working on palm oil plantations. One herbicide used on palm oil plantations is paraquat dichloride. Paraquat is a highly toxic chemical, and for that reason is banned in the EU as well as several other countries. In Indonesia it is a restricted substance. Amnesty International found evidence of the use of paraquat on Indonesian plantations, as well as the absence of training and sufficient personal protective equipment. Workers described negative health effects after exposure to the chemicals. Palm oil mills also pollute, producing 2.5 metric tons of effluent for every metric ton of palm oil it produces.

People

Oil palms are one of the most profitable crops for farmers, which in part is a success story: palm oil has helped to reduce rural poverty in places like Indonesia, for example. Palm oil has the potential to improve incomes and employment where it is produced. Millions of smallholders rely on palm oil for their livelihoods in Malaysia and Indonesia.

On the other hand, the oil palm industry can sometimes hurt communities economically because they lose access to forests and it may not be compensated sufficiently by economic gains from cultivating oil palms.

Working Conditions

Amnesty International has reported on the labour abuses on palm oil plantations. Specifically, they looked at plantations in Indonesia linked to Wilmar, the largest processor and merchandiser of palm oils (they control 43% of the global palm oil trade).

On those plantations, Amnesty International found evidence of forced and child labour, gender discrimination, as well as exploitative and dangerous working conditions.

Amnesty concluded that these are not isolated incidents, but rather linked to the systemic business practices of Wilmar and its subsidiaries and suppliers, such as the low level of wages, use of targets and “piece rates” (workers are paid based on tasks completed rather than hours worked), and a complex system of financial and other penalties. Because of these systems, workers that do not meet their targets get their already low salaries deducted.

Targets are set by individual companies and “appear to be set arbitrarily to meet companies’ needs rather than being based on a realistic calculation of how much workers can do in their working hours.” Because of the targeting system, workers on the plantations get help from their spouses, children, and others to complete tasks. Amnesty documented evidence of the involvement of children in hazardous tasks, which is illegal under Indonesian law, on plantations owned by two Wilmar subsidiaries and three Wilmar suppliers. Some were as young as eight.

Amnesty found that workers, especially women, are employed under casual work arrangements which make them vulnerable to abuse. While most harvesters (always men) are employed on permanent employment contracts, most plant maintenance employees are women and are employed on a casual basis.

Employers can penalize workers for failing to meet targets or for mistakes in their work (e.g. picking unripe fruit). This penalty usually has a financial dimension. These penalties are not transparent, which allows employers to exact work under the threat of loss of pay or employment. Amnesty International has documented instances of this, which it considers to constitute forced labour.

Indigenous Peoples and Nearby Communities

Indigenous peoples are losing their land to palm oil plantations. This is especially a problem in Indonesia. Land use rights in Indonesia are often disputed due to conflicts between customary land rights and formal property ownership.[15] Weak laws, poor government oversight, and the failure of palm producing companies to fulfil their human rights responsibilities have led to a loss of land and livelihood opportunities for Indigenous people in Indonesia, according to Human Rights Watch. Companies have failed to consult with Indigenous peoples and to provide just and fair compensation for losses suffered.

In some cases, Indigenous peoples are forcefully removed from their lands, which is one reason that the Rainforest Action Network has used the term “conflict palm oil” to describe the industry. Private armies and paramilitary groups are deployed sometimes, and community members have been killed in Indonesia. There are upwards of 600 ongoing land disputes between palm oil companies and rural communities.

Surrounding communities can also be made more at risk of flooding when palm plants are placed on steep slopes, causing soil erosion.

Food Security

Another problem with the conversion of agricultural lands for palm oil production is that it can hurt local food security (same with all cash crops).[16] And because palm oil is increasingly being used for biofuel, prices are increasing which can sometimes make it unaffordable for communities proximate to these plantations.[17]

Roundtable on Sustainable Palm Oil

What is it?

The Roundtable on Sustainable Palm Oil (RSPO) is a sustainable palm oil certification that was founded in 2004. Like the Marine Stewardship Council, RSPO was founded through a collaboration between the World Wildlife Fund and Unilever, as well as Asian producers and a few other Western brands (e.g. Nestlé, Tesco, Cargill).[18] It has managed sustainability standards for palm oil production since 2008.[19] An estimated 14% of palm oil is RSPO certified.

The backbone of the RSPO standard is a generic set of Principles and Criteria adopted in 2005.[20] There are eight core Principles:

Commitment to transparency,
Compliance with applicable laws and regulations,
Commitment to long-term economic and financial viability,
Use of appropriate best practices by growers and millers,
Environmental responsibility and conservation of natural resources and biodiversity,
Responsible consideration of employees, smallholders, and other individual communities affected by growers and mills,
Responsible development of new plantings, and
Commitment to continuous improvement.[21]

Each of the eight principles has corresponding criteria, which can also differ from country-to-country and location-to-location.[22] RSPO creates standards for the growth of oil palms as well as the palm oil milling process.[23] It also has standards for tracing palm oil through the supply chain (which is called chain-of-custody certification).[24]

There are also separate standards for smallholder palm farmers. That was introduced a bit later than the main standard, and it responds to the challenges that small producers can have in obtaining sustainability certifications.[25] Basically, the idea is to ask smallholders to make improvements over time, rather than asking them to do everything before obtaining certification. That program was just introduced in 2019, so it isn’t clear how well it will work.

RSPO is the largest and by many accounts the most robust palm oil certification available, but it has still been widely criticized.

Criticisms

RSPO is a multi-stakeholder organization (meaning there are different voices involved in defining standards). The seven groups of stakeholders included in the RSPO’s general assembly are: palm oil growers, palm oil processors and/or traders, consumer goods manufacturers, retailers, banks and investors, environmental and nature conservation NGOs, and social development NGOs.[26]

However, RSPO has been criticized for being industry-dominated and for failing to engage key vulnerable stakeholders, such as smallholding producers, labour unions, social and environmental groups, indigenous peoples and organizations, and women’s groups.[27]For instance, only a small proportion of palm oil-related land use conflicts are sufficiently acknowledged and resolved within RSPO’s institutional dispute resolution mechanisms.[28]

Greenpeace, Friends of the Earth, and other NGOs have criticized RSPO for the low stringency of compliance enforcement.[29] For instance, Amnesty International concluded that “the RSPO is acting as a shield which deflects greater scrutiny of Wilmar’s and other companies’ practices.”

Also, the majority of certified palm oil is mixed with conventional oil during transportation and as a result consumer products with the RSPO logo will most likely contain unsustainable palm oil.

Another argument is that the RSPO standard gives national governments an excuse to forego further public regulation of the industry.[30]

Critics also point to weaknesses in the standards themselves. RSPO initially avoided defining what sustainability means, going forward with the standard first.[31] RSPO’s emphasis on consensus decision-making, critics say, makes it incapable of dealing with contentious or controversial issues.[32] Even the moderate stringency of RSPO’s standards have led major stakeholders to leave.[33]

Although RSPO has devoted some attention to the issue, it is still difficult for smallholder palm producers to afford certification.[34] And small- and medium-sized producers have less of an incentive to get RSPO certified because they often supply Indian, Chinese, and Pakistani markets[35]

Kristen mentioned a book chapter that looks at the role of auditors in sustainability labelling. The book is called Transnational Business Governance Interactions.

Why is Certification Uptake so Low?

Most sustainability labels deal with agricultural products for which there is a specific consumer product with a recognizable link to the agricultural product – e.g., coffee, paper, sugar, cocoa, fish.[36] That isn’t the case for palm oil.

That makes it much more difficult to get companies to sign onto voluntary standards for palm oil. Consumers mostly don’t know that there is palm oil in a product. Producers mostly don’t want to emphasize that there is palm oil in their items, since it has baggage and is not the major ingredient. That makes it more difficult to develop a price premium for certified palm oil. And that problem is compounded because even companies like Unilever that might use RSPO certified palm oil are not necessarily going to put the label on, say, their peanut butter because they want to emphasize the primary ingredients instead.

Another challenge is palm oil’s position in the market. Because it is mostly used as a cheap additive, producers mostly do not want to take on the increased cost and because there may not be much potential to charge a price premium. That problem is compounded because so much of the palm oil market is from non-wealthy countries, and there is very little consumer demand for sustainability labelling there.

Boycott v. Sustainability Certification

Palm oil mainly ubiquitous because it is cheap. And there are no real alternatives that wouldn’t cause problems. So:

What Can You Do?

Social and Environmental Labels

Assuming that you aren’t going to go palm oil-free: the RSPO is better than nothing, but it’s not great.

The WWF has a palm oil buyers scorecard where you can search brands for information about whether they are RSPO members or not (though again RSPO is flawed). It only has a few brands, though.

Rainforest Action Network recommends looking for the Palm Oil Innovation Group (POIG) standard, which they see as the only standard truly free of deforestation, peatland destruction, and exploitation. All POIG retailers and manufacturers are RSPO members, and must be certified – so it’s basically a stronger version of RSPO. POIG doesn’t have many certified products right now, but it might be the solution of the future. Some noteworthy POIG members include: Danone, L’Oréal, and Barry Callebaut. POIG NGOs include: WWF, Greenpeace, RAN, Verité (fair labour group), Sumatran Orangutan Society, and Orangutan Land Trust.

For workers’ rights, try the RSPO Smallholder Standard (although this might mean weaker sustainability standards). Another option is FairPalm.

Fairtrade hasn’t created standards for palm oil yet, but there is one available label that is substantively like fairtrade: FairPalm is a label for palm oil grown by smallholders in West Africa.

Or try doubling up with organic labels – which can at least address the harmful chemicals problem. Organic labels deal with the use of pesticides and fertilizers, so on their own they cannot address the other problems with palm oil. Unfortunately, RSPO is the best we have on that.

Ethical Consumer Worst and Best Ratings

Ethical Consumer has put together a list of brands to avoid (received their “worst” rating on palm oil use). Here are some of the brands that I recognized from that list:

Nestlé – Kit Kat, NESCAFÉ, Perrier
Mondelez – Cadbury
Domino’s Pizza
Yum! Brands – Pizza Hut, KFC
Subway
Itsu
Prêt-à-manger
TGI Friday’s
Pizza Express
L’Occitane
Proctor and Gamble – Pampers, Head and Shoulders

Ethical consumer also has a list of recommended brands (received their “best” rating on palm oil use). I only recognized a few brands from this list:

Marks and Spencer
Waitrose
Lush
Nivea
Georganics

Get Involved!

Get involved with campaigns asking companies to implement sustainable palm oil practices. Write to companies to get them to use sustainable palm oil. Find out more about Michelle Desilets by following her on twitter.

Endnotes

[1] Ethical Consumer Podcast. (2018). Complex World of Palm Oil. Ethical Consumer.

[2] Paiement, Phillip. (2017). Transnational Sustainability Laws. New York: Cambridge University Press.

[3] The Food Chain Podcast. (2019). Can Palm Oil Be Sustainable? BBC World Service.

[4] Ethical Consumer Podcast, “Complex World of Palm Oil”.

[5] Ethical Consumer Podcast, “Complex World of Palm Oil”.

[6] Audio Long Reads. (2019). How the World Got Hooked on Palm Oil. The Guardian.

[7] Audio Long Reads, “How the World Got Hooked on Palm Oil.”

[8] Audio Long Reads, “How the World Got Hooked on Palm Oil.”

[9] Paiement, Transnational Sustainability Laws.

[10] Paiement, Transnational Sustainability Laws.

[11] Paiement, Transnational Sustainability Laws.

[12] Paiement, Transnational Sustainability Laws.

[13] Paiement, Transnational Sustainability Laws.

[14] Paiement, Transnational Sustainability Laws.

[15] Paiement, Transnational Sustainability Laws.

[16] Paiement, Transnational Sustainability Laws.

[17] Paiement, Transnational Sustainability Laws.

[18] Paiement, Transnational Sustainability Laws.

[19] Paiement, Transnational Sustainability Laws.

[20] Paiement, Transnational Sustainability Laws.

[21] Paiement, Transnational Sustainability Laws.

[22] Paiement, Transnational Sustainability Laws.

[23] Paiement, Transnational Sustainability Laws.

[24] Paiement, Transnational Sustainability Laws.

[25] Paiement, Transnational Sustainability Laws.

[26] Paiement, Transnational Sustainability Laws.

[27] Paiement, Transnational Sustainability Laws.

[28] Paiement, Transnational Sustainability Laws.

[29] Paiement, Transnational Sustainability Laws.

[30] Paiement, Transnational Sustainability Laws.

[31] Paiement, Transnational Sustainability Laws.

[32] Paiement, Transnational Sustainability Laws.

[33] Paiement, Transnational Sustainability Laws.

[34] Paiement, Transnational Sustainability Laws.

[35] Paiement, Transnational Sustainability Laws.

[36] Paiement, Transnational Sustainability Laws.