Palm oil is the most-certified vegetable oil crop, and one of the world’s most certified commodities. It is certified under a number of different schemes. Malaysian Sustainable Palm Oil (MSPO) is the country’s national standard.
Implementing the standard is mandatory. All participants in Malaysia’s palm oil supply chain must be certified, from the smallest smallholder to the largest plantation owner, through to processors of palm oil and chemical derivatives.
All of the country’s plantations are covered. This means more than 5.58 million ha of plantations, and more than 450,000 smallholder farms, as well as large companies.
The standard has been made stronger. MSPO undertook a major revision that was completed in 2021, and strengthened requirements on labor and environment in particular.
There are 5 principles organizing the standard. They are: Management commitment and responsibility; Transparency; Compliance with legal and other requirements; Responsibility to social, health, safety and employment conditions; Environment, natural resources, biodiversity and ecosystem services.
There are a total of 28 criteria and 88 indicators that make up the standard. These range from ensuring the eradication of child and forced labour through to introducing HCV (high conservation value) guidelines.
The revision introduced new and tougher environmental and social standards. These include:
- A cut-off date for deforestation
- Identification of greenhouse gas emissions and monitoring plans for GHG reduction
- Introduction of new guidance on free, prior and informed consent (FPIC)
- Safeguarding of human rights defenders and whistleblowers
There is no avoiding responsibility on labour standards. Under the standard, companies can’t avoid responsibilities to employees that are subcontractors or employed via an agency. Employers must take full responsibility for all workers, whether they are directly employed or not.
MSPO also incorporates traceability. This will assist in greater levels of supply chain transparency for jurisdictions and purchasers seeking additional assurance.
Many large companies in Malaysia will have double certification. They will be certified to both MSPO and other voluntary standards. This demonstrates Malaysia’s commitment to meeting the sustainability requirements of customers and governments all around the world.
The standard has been recognized internationally. Recognition has occurred through bodies in Japan and China, and the MPOCC has signed agreements with a number of NGOs.