Part 1/2: The Shift of Palm Oil towards Sustainability

When hearing or reading about palm oil industry. I always had an utterly negative image of large, greedy companies in my head that value their profits over the environment and indigenous communities. Everyone has seen those pictures of never-ending plantations, bulldozers that tear down gigantic areas of the rain forest so relentlessly and easily that it reminds you of cutting the grass in your backyard, and endangered species losing their natural habitat.

How could companies be so ruthless in eroding the rain forest, one of the most precious gifts of our planet, just to make room for a larger plantation area?

But, please, cross your heart: Isn’t our world more complex than that?

At some point I realized: It is easy and convenient to put all the blame for the social and environmental harm of the palm oil business on the involved companies. But there is more to this story. It is not what companies do but how they do it. And in fact, it is the average consumer like me that has the finger on the trigger of how companies acquire palm oil. Every one of us uses products containing palm oil on a massive scale: It is an essential ingredient in everyday products like lipstick, pizza dough, instant noodles, shampoo, ice cream, detergent, margarine, chocolate, cookies, biodiesel, soap, and packaged bread, just to name a few (Don’t tell me you don’t eat pizza).

That means we as consumers determine how companies source palm oil - How exactly? What’s the incentive for companies?

Nowadays, many consumers have come to this same realization: In order to make the transition towards sustainability, they themselves need to change their buying behavior. Thus, consumers now check for certificates on packages that declare the sustainable sourcing of the product’s ingredients as an essential part into their buying decisions. Not only does this result in a higher demand for sustainable products but it also allows companies to charge the consumer a premium on those products. Accordingly, companies that are able to become truly sustainable have a competitive advantage, even more in the future (Nicely illustrated in Stuart Hart’s pioneering book “Capitalism at the Crossroads”).

Why the emphasis on truly sustainable?

Being sustainable has become such a misused and overused term that by adding the word truly to sustainable is needed here to identify business practices that go beyond greenwashing. Simply talking and writing about how sustainable your company is without showing any kind of proof no longer gives you an advantage over others. But in order to prove that your product is really sustainable, you also need to prove that every ingredient has been sourced in a sustainable way. The ability of tracing back the origin of every ingredient and material for every manufactured product unit is required to achieve a credible sustainability certification.

By Fabian Wollersheim (link)