Oil palm growers can face many barriers when trying to obtain land for cultivation, with poorly informed land acquisition or allocation having long-lasting consequences. Growers may be faced with difficult trade-offs, such as risking their operational efficiency or reputation if the establishment of a plantation has a negative impact on communities and ecosystems. To manage these risks and optimise opportunities for sustainable growth, palm oil producers should follow best practice guidelines and investigate and assess legal, political, social, and environmental conditions from the outset. This will help them make informed decisions when reviewing suitable land for conversion to plantation.
What legal and political issues should be considered?
The process for acquiring land permits for oil palm plantations varies by country, but the challenges involved are often similar.
- Lack of strong land tenure and spatial planning can expose companies to many legal and reputational risks. In some regions, oil palm growers may be provided with permits that conflict with permits issued to other companies or stakeholders for different land use by the same or different government agencies, as is discussed in the report Promised Land – Palm Oil and Land Acquisition in Indonesia: Implications for Local Communities and Indigenous Peoples.
- The potential for corruption exposes growers to substantial media and legal risks, particularly in light of tightened anti-corruption laws in the UK and USA.
National, state, and local laws related to conservation and land use do not always align, increasing the risk involved in developing on land concessions before establishing the permitting, political, and legal situation in the area.
What are the social issues involved in land acquisition?
Local communities or indigenous groups may have informal rights to the land and may inhabit areas allocated for conversion. Displacement and disenfranchisement of such groups can result in legal action, strikes, and sabotage; therefore, immediate remediation is required to address these issues. Poorly managed situations can also harm a company’s reputation and, consequently, their profits and long-term success. These issues are outlined in Oil Palm Expansion in South East Asia: Trends and implications for local communities and indigenous peoples.
What are the environmental issues involved?
Most countries require that some form of environmental impact assessment (EIA) is carried out prior to land use change. Once the initial EIA has been carried out, further assessment of High Conservation Value areas may be required. Through careful planning, oil palm growers can reduce their environmental impact by either finding alternatives to developing in riparian areas or areas of high conservation value or putting in place methods by which these can be conserved and managed. Furthermore, by embedding landscape conservation priorities within their corporate social responsibility (CSR) targets and policies, growers can reduce conflict, improve their public image, and improve plantation efficiency.
- The World Resources Institute’s working paper How to Identify Degraded Land for Sustainable Palm Oil in Indonesia presents a straightforward method for identifying potentially suitable areas of degraded land for oil palm cultivation.
- See the case studies section for a report from Fauna & Flora International (FFI) on various options available to growers for the protection of high conservation value (HCV) areas.
