Changing corporate practice in the palm oil industry give room for optimism, scientist say. Ryan Woo/CIFOR.

Not cutting down trees for other land uses might sound simple enough, but it’s turning out to be rather complicated.

Or so it turns out for the agribusiness giants that, under pressure from environmental and consumer campaigns, have lined up to embrace the “No deforestation” movement.

Take Indonesia, for example – the world’s largest producer of palm oil, where some 60,000 sq km of forest was cleared between 2000 and 2012 – and where companies seeking to reduce deforestation face such obstacles as conflicts with communities, unsupportive government policies and fears of market disadvantage.

And they need government support in overcoming them, according to a new analysis by the Center for International Forestry Research (CIFOR).

“Advocacy groups and company spokespeople can stand up and demand or promise whatever they like, but the pledges mean nothing if the tricky realities are not sorted out,” says CIFOR senior scientist and study co-author Romain Pirard.

“And that’s going to require not only that companies change their practices, but that government makes changes too,” he adds.

WHOSE LAND, WHOSE RIGHTS?

One difficulty the larger companies complain about is that local communities and smallholder farmers in Indonesia – some of whom have no legal claim to the land – encroach on the company concession areas.

But for smallholders – about 2 million households in Indonesia – zero deforestation pledges pose a risk to their livelihoods and currently do not offer them the benefits that larger companies receive.

Many “encroachers” live permanently in or near concession areas and log illegally, the researchers found, highlighting the need to clear up overlapping claims of land ownership.

“Companies could try to evict people who encroach and log, but then conflicts with communities arise and they get bad publicity for that too,” Pirard says.

“On the other hand, there are many cases of legitimate claims by communities who were deprived of their ancestral rights to land, so the situation is far from black and white,” he adds.

“If we do open the ‘black box’ of land tenure and conflict in Indonesia, it may create tools that the government can use for fair and sustainable land conflict resolution,” Pirard says.

Yet while “many of the issues are related to land tenure,” according to CIFOR consultant researcher Sophia Gnych, she also warns that simply introducing “stricter standards” is not the solution.

“Not only do we need to have a clear indication of who has rights over what, but we need to be flexible about mitigating the potential side effects of these new commitments,” she says.

The report also identifies other land and legal issues that affect companies’ attempts to meet their zero-deforestation commitments.

Government policy and the legal framework can often be “unsupportive, but also unsuitable and contradictory” to industry intentions, it states.

“A good example is the way the Indonesian government has, on several occasions revoked concessions because they planned to conserve pieces of forest on it,” says Pirard.

“These plots of land are earmarked for production, and the government expects production to take place in the entire area.”

As a result, the government may then reallocate the conserved land to another company that will log the forest and start producing – which will lead to tax revenue.

The analysis also uncovered examples of where companies that had made conservation commitments had their temporary permits withdrawn when they took “too long” to set up plantations while they were assessing the conservation value of forest in their concession area.

“The government will be expected to do more in the future to allow these commitments to materialize,” Pirard says.

Expert analysis

One wicked problem, three major challenges

One of the most important steps, Gnych says, is making sure all the right people are at the table and willing to compromise and work together.

“There really needs to be more dialogue between companies and the government,” she says.

If everyone can sit together, the authors write, “these commitments have the potential to overcome the inertia that has dominated the Indonesian oil palm industry and unite all stakeholders, including government, to transform the sector.”

AN EVEN PLAYING FIELD

And it doesn’t just stop at zero deforestation.

The researchers suggest that the “the issue of legacy is critical and has probably been underestimated so far.”

Should those companies – many of whom who have been responsible for “huge deforestation” – be allowed to just pledge zero deforestation? Or should it be demanded that they go further, right past wrongs, and aim for “positive net reforestation”?

“You can hold companies accountable for their past actions,” says Gnych pointing to the fact that the government has created a system of ecosystem restoration licenses, which allows “companies to manage degraded areas so that they restore the forest productivity and its ecosystem services”.

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Investigating the pledge of zero deforestation

Two giant pulp and paper companies in Indonesia, Asia Pulp & Paper (APP) and APRIL, have already invested in concessions with a view to restoration.

And APRIL recently announced that it had stopped the harvesting of all natural forest as of 15 May, four years earlier than previously planned.

Several companies who have already signed the palm oil pledge are eager for others to buy in. They argue that meeting their zero-deforestation commitments while their competitors continue to deforest puts them in a less competitive market position. They are keen for the government to regulate so that all companies must meet the same standards.

Romain Pirard stresses that such regulation could be a way off, as the zero-deforestation movement is still in its infancy. It will take time to the government and private sector to work together towards this important goal, he says.

“But we are already seeing real change in the way some companies are operating, so there is a lot to be optimistic about.”