September 22, 2017

Companies in Malaysia are Mum about their use of Palm Oil

Companies in Malaysia are Mum about their use of Palm Oil

Supermarkets are packed with products containing palm oil. Photo Credit: Linkedin

The results are in and they aren’t all that encouraging: some two-thirds of 47 companies in Singapore and Malaysia surveyed by the World Wide Fund for Nature may be using palm oil obtained in unsustainable ways. We don’t know if they indeed are because they won’t tell.

Sad, yes.

Palm oil is a versatile substance that is used in a wide range of consumer products from food to cosmetics. In fact, as many as 50% of food products available in supermarkets may contain some palm oil. Palm oil production is a key driver of Malaysia’s economy, accounting for around 5% of Malaysia’s annual GDP. The trouble, of course, is that much of all that palm oil is routinely produced in ways that inflict grave harm on Malaysia’s environment. Forests are felled and peatlands are destroyed to make way for palm oil plantations. More and more customers know this and are eager to buy brands whose makers use palm oil obtained sustainably.

Few local companies have aquitted themselves well on WWF’s sustainable palm oil scorecard in 2017. Photo Credit: WWF

To help customers in that, WWF conducts an annual Palm Oil Buyers’ Scorecard, on which it rates leading household brands in Malaysia and Singapore on a 12-point scale according to how certifiably green they are in sourcing palm oil. This year, of the 47 companies contacted by the environmentalist group only 16 have disclosed information on the matter. Of those 16 companies, 10 are in Singapore, where 27 companies were surveyed.

“We were disappointed at the number of non-responses because it doesn’t enable us to gauge how well the market is moving along and how much help it needs in raising awareness and understanding what we need to do,” observed Denise Westerhout, head of WWF-Malaysia’s sustainable markets program.”

Only two companies in the region, Denis Asia Pacific (which produces Ayam Brand canned food in Singapore) and Wildlife Reserves Singapore Group, have managed to score high, earning 10 and nine respectively out of the possible 12 on the scorecard. Both businesses have pledged to ensure they would source all their palm oil in certifiably sustainable ways: Denis Asia Pacific by 2018 and Wildlife Reserves Singapore Group by 2022.

“While our total consumption of palm oil is limited, it is possible to make sustainable choices even when manufacturing in smaller volumes,” said Roy Teo, country managing director for Ayam Brand in Singapore. “We see this business decision paying off through increased employee satisfaction, higher brand value and new business opportunities in Europe, the United States and Australia, where sustainable palm oil has become a market entry criteria.”

Here is hoping that more and more companies in Malaysia and Singapore will likewise see the light, follow suit and do better in sourcing their palm oil sustainably.


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