Commodity certification, human rights and deforestation – views from the ground

Norman Jiwan is a Dayak indigenous leader from Borneo, West Kalimantan Indonesia. Over the past two decades, he has worked for Friends of the Earth Indonesia (WALHI) Kalimantan Barat, SawitWatch and TuK INDONESIA and actively participated in the Roundtable on Sustainable Palm Oil (RSPO) standard setting and accountability processes, including spending four years on the Executive Board. He has equally been involved with filing numerous complaints under the RSPO complaints procedures, and is qualified to audit RSPO standards.

FPP spoke to Norman Jiwan about his experiences with certification and his views on their value for due diligence frameworks that are being developed in Europe and the UK.  

 

“For me, natural resources, land rights, environmental issues are all human rights issues – you can’t just talk about the civil and political rights, like when people get arrested.”

 

Norman Jiwan

“Certification schemes are essential, but also very problematic”

Certification schemes such as RSPO are about improving the currently unjust conditions faced not only by indigenous peoples and local communities as the owners of land, natural resources and agrarian properties, but also by smallholders (who are often indigenous peoples who have been transformed into producers because of a lack of land) or workers / labourers (who have often become landless because of the expansion of palm oil).

Full compliance with the RSPO’s Principles & Criteria (P&C) requires companies to take many important actions: a due diligence process, but also capacity-building for affected stakeholders aimed at explaining and training people on their approach and their rights. However, this needs to be aimed not only at workers, staff and management, but also at affected communities, indigenous peoples, women, and other stakeholders around their operations.

 

“But this is the problem, companies only do something on paper, without genuinely seeking to fulfil their membership obligations.”

 

If you apply RSPO P&C without doing a credible capacity-building process with stakeholders, you will be exacerbating the current situation, which is often unjust.

But can you imagine if a company had to explain one by one the RSPO standards on land rights, Free Prior and Informed Consent (FPIC), just acquisitions to the very people who are in conflict with them? Who perhaps at the beginning felt that there was nothing wrong with the company’s actions, that their losses were inevitable. But then who begin to see their FPIC is being compromised, their human rights are not being respected.

 

The current situation is that indigenous peoples, local communities, smallholders, workers and women are in a weak position. They cannot confront these issues easily because they do not have access to information, resources and capacity to be a genuine part of the certification process, which would enable them to be effective. This is the big and serious problem of certification.

 

The second problem is the lack of capacity of the certification body itself. Good on paper but not on the ground. If the auditors don’t have capacity (especially on human rights) and have relationships with companies, it becomes a tick-box exercise, it doesn’t assess real performance and compliance. If you ask me what I think about certification schemes such as RSPO, my big question is: have they implemented what is required by the standard, especially capacity building with stakeholders? If not, the issue of certificates is still problematic.

You still need a certification process – it is a process of improving the currently unjust conditions and situations, but a proper certification process is just the beginning. You cannot just leave everything there, without involving an effective surveillance (monitoring and compliance) process.

 

For me, certification schemes are one amongst many tools that creates space for indigenous peoples and local communities, especially when we talk about producer countries that don’t have strong human rights legal framework.

 

If we compare Indonesia and Malaysia, Indonesia is very good at ratifying international conventions, but bad at making them national regulations. But that situation is still better than nothing, better than countries like Malaysia – best practice also needs to be introduced in the context of producing countries that don’t have such commitments.

Experience shows that certification has improved practice on the ground in Malaysia, particularly how smallholders can benefit from a levy for tonnage of palm oil: I don’t like to admit it but Cargill has been among the better ones in supporting smallholders. They receive a premium for certified palm oil and contribute that back to their smallholders. This is how a certification initiative can incentivise improvement.

Exposing gaps in the RSPO process – West Kalimantan

One of the first cases I dealt with in my work, in the early 2000s, was a palm oil case in West Kalimantan – PT Harapan Sawit Lestari (PT HSL). PT HSL is a subsidiary of Cargill, and the case is still ongoing even now – there are historical land conflicts which are still not resolved. It’s an indication of some of the limitations of certification processes. [A more detailed case study looking at this case is included in a 2021 report co-published by FPP and co-authored by Norman, Demanding Accountability.]

Perhaps the biggest and most important cases I’ve been involved with are the Wilmar cases (see e.g. here and here), when we filed complaints of violations of human rights against Wilmar with the RSPO, as well as with the Compliance Advisor Ombudsman in relation to the International Finance Corporation (IFC- a member of the World Bank Group) (see e.g. here and here). The IFC was providing financing for palm oil development that was flowing to Wilmar.

The issue at that time was land grabbing / dispossession without FPIC and conducting operations without any environmental impact assessment. Human rights include a right to a due process of law, and environmental impact assessments are a basic part of that access to justice. Wilmar were using fire to clear land, and the burning method of clearing land violates indigenous peoples’ rights to health and to a healthy environment. There were also issues of criminalisation and land conflicts, and the right to clean water was also involved, because digging and clearing land caused sedimentation to streams and rivers. Looking back, what we didn’t incorporate adequately in the complaint to World Bank was specific gender-related abuses linked to Wilmar’s operations.

 

The complaint was filed in July 2007 and it was one of the biggest and most important cases ever filed - it was a litmus test for the RSPO system.

 

It was the first case challenging RSPO members, and the first case that brought about serious changes. It influenced not only the lending rules of the IFC but also the World Bank Group as a whole. Going forward, the World Bank Group gave more consideration to the human rights impacts of the activities they were funding, and it also shone a light on how investment and lending without safeguards contributed to human rights impacts.

From a small group of 7 organisations working on the complaint, more than 200 individuals and organisations ending up signing a letter to the World Bank calling for changes to its lending rules. It led to a two-year moratorium by the World Bank – after an audit confirmed the findings of the CAO. It really changed the accountability mechanism at both World Bank and RSPO level (which until then had been a very passive process). In addition, at that time there were no specific requirements on human rights in the RSPO’s P&C and this case really exposed that gap.

“One of the biggest challenges relates to historical land conflicts and land restitution”

Companies say the process of rectifying bad FPIC processes in the past is really complicated. The truth is they don’t want to create good precedents for the community and bad precedents for the company. If they make land restitution there will be a rush of demands for restitution in other communities, not only in Indonesia but from around the world.

A certification system can’t force companies to do something that they think is impossible (or fundamentally against their commercial interests) – and companies don’t think land restitution is workable. That is one of the biggest challenges, not only for the private sector but also with government. RSPO members must comply with the whole set of the standards properly, in certifications, in their own internal assessment, and in their preparations for due diligence.  But they are their own business animals, and at the end of the day they are chasing money.

Certification schemes have a place, but are not enough to satisfy due diligence requirements

A certification scheme does not guarantee respect for human rights. If you asked me if there are any “good” companies who have been certified, frankly speaking I’m not sure that there are. This is why downstream company due diligence by companies, proposed for example by EU and UK legislation, must go beyond just certification. Otherwise, the certification process will not be no more than a labelling and stamping exercise that will sustain unjust conditions, while contributing to profit maximisation for the palm oil companies.

Certification schemes are one element in the process of creating more sustainable supply chains. But if company due diligence schemes proposed by the EU and the UK is to be meaningful for indigenous peoples and local communities, companies must look beyond certification at the reality of production.

Biography

This year Norman is celebrating 20 years as an activist in the human rights and environmental movement in Indonesia. During his career, he has worked with Friends of the Earth Indonesia West Kalimantan chapter, SawitWatch, and TuK INDONESIA (among others). He spent four years on the RSPO’s Executive Board (now Board of Governors) as the representative of social organisations on the board, along with Oxfam. During that time he (along with Sime Darby) proposed and then started a human rights working group as part of the RSPO.

Read this article in Bahasa Indonesian.