Supply Chain Collaboration & Co-Creation

BASF, Estée Lauder, RSPO Partner to Enhance Sustainable Palm Oil Production

The goal is to improve farmer livelihoods and their sustainable production of palm oil and palm kernel oil, through continuous education and technical support on implementing and maintaining sustainable palm oil practices.

Published 5 years ago | About a 3 minute read

Image: Greenpeace

The Estée Lauder Companies (ELC) has partnered with BASF, international development NGO Solidaridad and the Roundtable on Sustainable Palm Oil (RSPO) on a three-year project to promote sustainable palm oil and palm derivatives production in the district of Way Kanan, Lampung, Indonesia.

The goal of the project is to improve farmer livelihoods and their sustainable production of palm oil and palm kernel oil, through continuous education and technical support on implementing and maintaining sustainable palm oil practices. The project partners are collaborating with local Indonesian organizations to foster a sustainable palm oil production supply chain in Lampung that is free from deforestation and competitive in the global market, while increasing the social and economic benefits for farmers — with a target of a minimum of one-third of the supported smallholder farmers become certified according to the Smallholder Standard of RSPO at the end of three years.

The Project also seeks to improve communication and support the development of market linkages between farms and mills, as well as provide long-term technical support for these new tools after formal training has ended. Solidaridad projects that with more sustainable practices in place, harvest yields will improve and the local farmers will have greater ability to sell collectively. It is expected that farmer organizations that support compliance with the Smallholder Standard of RSPO and Indonesian Sustainable Palm Oil (ISPO) will further strengthen the practices and economies of local farms, and will ensure the region’s supply is responsibly sourced, helping to ensure that sustainable practices are the industry standard.

“Most major European companies have committed to using sustainable palm oil exclusively," said Heske Verburg, Managing Director of Solidaridad Europe. "We are delighted that BASF and The Estée Lauder Companies are reaching beyond just purchasing sustainably, by providing direct support for sustainable palm oil projects. When palm oil is produced sustainably, and in a future-proof manner, it can actually contribute to resolving grave issues for both farmers and the environment.”

While ELC is a relatively small consumer of palm oil globally, 40 percent of the palm and palm kernel oil consumed globally across industries is supplied by farms like those participating in this initiative. The company says it hopes improving farming practices and facilitating dialogue among all parties involved in its production will help protect and provide opportunities to the farmers; and, by extension, to their families, communities, the environment and industry as a whole.

“We are thrilled to partner with BASF and Solidaridad on this important initiative to support Indonesian smallholder farmers,” said Greg Polcer, EVP of Global Supply Chain at ELC. “So many livelihoods in this community are inextricably tied to the production and we support ensuring that it is produced sustainably — both for the long-term benefit to the environment and for the long-term benefit to the community itself.”

“Approximately 40 percent of the world palm production comes from smallholder farmers who rely on it for their livelihoods,” said Daniele Piergentili, VP of Home and Personal Care at BASF in North America. “The partnership with Estée Lauder, Solidaridad and RSPO enables us to support these farmers and at the same time increase the availability of sustainably produced palm oil.”

"For sustainable production to become mainstream and fully inclusive, the RSPO believes it is imperative to support smallholders through a variety of different approaches, including the RSPO Smallholder Support Fund (RSSF),” said Ashwin Selvaraj, Head of Smallholder Unit in the RSPO Secretariat. “This collaborative project in Lampung is a great opportunity to scale up sustainable practices, protect natural resources and bring more smallholders under certification through RSPO Best Management Practices.”