Responsible palm oil, alternative livelihoods and land reform policies

In West Kalimantan, IDH convenes major palm oil companies that have an interest in delinking palm oil from deforestation, governments and CSOs to test various production, protection and inclusion (PPI) business models including the very successful non-forest revenue-generation Village Forest commodities (like charcoal from coconut, crab and honey).

In addition, our convening work helped to set up the peat and forest fire prevention measures (Fire Free Villages) and the development of an ecological corridor between Gunung Tarak and Sungai Putri.

Particularly for Village Forest, the project of IDH with local NGO Sampan that makes villages responsible for managing forests in their village (and creating alternative sources of livelihood), has been recognized by the Ministry of Environment and Forestry of Indonesia as a successful example of implementation of the government’s land reform policy.

The ecological corridors in Kubu Raya, Kayong Utara and Ketapang districts have showed the big interest of private sectors such as PT Pasifik Agro Sentosa (PT PAS), Bumitama and Austindo Nusantara Jaya Group in avoiding destruction of HCV/HCS areas within their concessions with legal support, the Essential Ecosystem Area (Kawasan Ekosistem Esensial, KEE),  from Government of West Kalimantan and Ministry of Environment and Forestry of Indonesia.

For companies like PT PAS and Bumitama, KEE  gives clarity on what land cannot be converted. Currently, there are more than 30,000 ha of forest on and off concession in Kayong Utara and Ketapang districts under KEE protection status. Policies on incentives and or compensations for companies to preserve KEE on their concessions are currently under discussion.

Thumbnail video

We aim to conserve 190,000 hectares of HCV/HCS forest and peatland (directly and indirectly), restore 10,000 hectares of forest and peatland, improve sustainable agricultural production on 45,000 hectares and enhance the livelihoods of 10,000 smallholder farmers and community members.

Total land cover 14.7 million ha
Total forest cover 4,871,885 ha
Forest on peatland 1,741,299 ha
Total oil palm concessions (50 companies) 4,681,432 ha
Total forestry concessions 2,201,642 ha
Forest loss 2005 – 2015 894,096 ha
Remaining carbon stock 1,6 Giga tons CO2
Landscape features coastal mangroves, peatlands, lowland forests, waterways, endangered species
Major commodities palm oil, timber and other forestry products, coconut, illipe, rubber, rice
Main causes of forest loss deforestation for agriculture and forestry, forest fires, mining

Working with government at national, provincial and local levels to develop and implement green growth strategies, allowing for forests to be set aside for conservation while enabling a legal framework and law enforcement.
We are currently at the last stage of finalizing the provincial green growth plan.

In a number of landscapes in West Kalimantan province, IDH is convening stakeholders in “PPI Compacts”: An agreement between public, private, community, and civil society stakeholders to enhance the sustainability and productivity of land and increase and diversify community livelihoods in exchange for forest/natural resources protection. The PPI Compacts provide an improved governance environment at the landscape level, which enables investment in PPI land use. Based on this, we create conditional financial incentives for sustainable palm oil production, forest protection and activities to intensify land use by (in)dependent smallholders.

We engage with companies from palm oil, rubber and forestry sectors and national, provincial and district level governments.

IDH works at the market end, especially in Europe, to drive the uptake of the sustainably produced commodities in the landscape. Our market convening work also creates a stronger business case for the companies on the ground to produce more sustainably.
To drive the uptake of more sustainable palm oil in Europe, IDH and MVO (the Dutch Oils and Fats Industry) established the European Sustainable Palm Oil, or ESPO, project in 2015. The project was initiated to stimulate the uptake of more sustainable palm oil in Europe, and its objective is to achieve ‘100% sustainable palm oil in Europe by 2020’. ESPO works in close collaboration with various National Palm Oil Initiatives on sustainable palm oil, the RSPO and umbrella EU associations, such as Caobisco (confectionary), Fediol (refineries) and Imace (margarines), and connects to the green sourcing areas.

Outside of Europe, IDH has also set up the Palm Oil (Markets) Program in India that works to mainstream the uptake of sustainable palm oil. India is the largest consuming market of Indonesian palm oil, and consumes 13.5% of the total global production – making it one of the largest markets for the commodity. This gives India agency, as it is well positioned to demand palm oil produced in a responsible manner without deforestation risk. It is also well placed to further strengthen South-South Cooperation while providing regional stewardship for the trade of responsibly sourced commodities including palm oil.

In India, IDH’s Palm Oil Program contributes to the SDG 12 for Responsible Consumption and Production. We do this by:

  • Convening large palm oil buyers operating in India to build reporting and disclosure
  • Remaining inclusive and standard-neutral
  • Working towards influencing demand in the short term and encouraging responsibly sourced supply in the long term
  • Monitoring the uptake of responsibly sourced/sustainable palm oil
  • Building engagement with the Government of India

Read more about the program here.

Listen to our podcast

Case Study



For more information contact us

Public and private partners in IDH Initiatives