RSPO

RSPO stands for “Roundtable on Sustainable Palm Oil.” It is a non-profit organization based in Malaysia, founded in 2004. Plantation owners, traders, food corporations, banks and environmental organizations all take part in it. Together they have agreed on a set of rules that specifies how palm oil is to be grown. Anyone who complies with these rules and has this confirmed by independent auditors may sell their oil as certified. Certified means: an independent body has inspected and confirmed in writing that the rules have been followed.

Palm oil, rainforest and the pressure on corporations

Palm oil is the most-produced vegetable oil in the world. It is found in margarine, chocolate, instant soups, soap, cosmetics and biodiesel. The reason is simple: the oil palm yields significantly more oil per hectare than rapeseed or soybeans. Around 85 percent of global production comes from Indonesia and Malaysia.

But it is precisely there that large rainforests and peat bogs are located. Over decades, forests have been cleared and peatlands drained to make way for new plantations. This releases huge amounts of carbon dioxide, and species such as the orangutan lose their habitat. On top of this come conflicts over land rights and poor working conditions on some plantations.

RSPO emerged as a response to this pressure. Major brands wanted to continue using palm oil without being attacked by environmental campaigns. For investors and journalists, certification therefore also serves as a metric: it shows how seriously a corporation takes its own sustainability promises. Conversely, a lost RSPO certificate can damage a company’s reputation.

From the plantation to the seal on the package

RSPO’s set of rules comprises several dozen criteria. Key points include: no clearing of forests with high conservation value, no cultivation on peat soils, no burning of land, no child or forced labor, and involvement of the local population in land matters. Independent auditing firms visit the plantations and mills and write reports. The certificate, which must be renewed regularly, is only granted if the audit is passed.

After that, the real problem begins: the supply chain. Palm oil from many plantations is mixed together in tanks, ships and refineries. Certified and non-certified oil can no longer be distinguished from one another chemically afterward. RSPO therefore works with four models of varying strictness.

Under the strictest model, the oil from a single plantation remains fully segregated. Under the weakest model, “Book and Claim,” a company only buys certificates from certified farmers, while the oil actually delivered can come from any source. Think of it like a voucher: the farmer receives money for behaving better, but his oil does not necessarily end up in this particular product. Critics consider this too lax, while proponents see it as a realistic entry point for small operations.

The seal in the supermarket and in corporate reports

RSPO is most visible as a green seal featuring a stylized oil palm on packaging. It appears on chocolate bars, cookies, detergents and cosmetics. About one-fifth of the palm oil traded worldwide is now RSPO-certified. Even so, it’s worth checking the ingredients list, since palm oil also hides behind terms such as palmitate or palm kernel oil.

In the sustainability reports of large corporations, the share of certified palm oil appears as a fixed metric. Sustainability report here means the annual report in which a company accounts for environmental and social issues. Fund providers and rating agencies use such figures to assess companies. The EU also plays a role: its regulation against deforestation has recently required proof of the origin of palm oil. An RSPO certificate alone is not legally sufficient for this, but it helps companies build the necessary evidence.

A common misconception is that RSPO palm oil is guaranteed to have been produced without any deforestation whatsoever. That is not true. Environmental organizations repeatedly document violations among members, and the weakest trading model reveals little about the specific goods involved. RSPO is a minimum standard with a control mechanism, not a guarantee.