This article first appeared in The Edge Malaysia Weekly on June 17, 2024 - June 23, 2024

The mandatory palm oil certification scheme, the Malaysian Sustainable Palm Oil (MSPO), is a world-class standard capable of helping Malaysian exporters and European customers adhere to stringent no-deforestation regulations. This conclusion emerged from a recent webinar organised by the Malaysian Palm Oil Council, featuring experts from the European Forest Institute (EFI) - Dr Jossil Murray and Pierre Bois d’Enghien, a leading palm oil and rubber certification expert and the author of the MSPO EU Deforestation Regulation (EUDR) gap analysis.

Over recent months, both EFI and Bois d’Enghien have conducted independent assessments of the MSPO standard, concluding that it includes robust requirements for no deforestation, mandatory reporting and auditing, among other criteria. Bois d’Enghien emphasised that “MSPO is by any standards a world-class standard for agriculture”.

The assessments also evaluated how closely MSPO aligns with the new EUDR, a complex regulation imposing new regulatory burdens on seven commodities imported into the EU, including palm oil. The EUDR aims to reduce the EU’s importation of products linked to deforestation, affecting stakeholders across Malaysia’s palm oil supply chain. Companies must provide due diligence statements demonstrating that their products are deforestation-free and specify the precise geolocation of land plots of over 4ha in size. Certifications like MSPO are crucial in helping businesses meet EUDR requirements.

The experts identified a few areas for potential enhancement (referred to as “gaps”) to achieve full alignment with the EUDR. In several aspects, the MSPO was found to be even stricter than the EUDR. For example, MSPO has more rigorous labour standards and an earlier deforestation cut-off date (2019) compared with the EU regulation (2020). Conducting these assessments offers Malaysia an opportunity to continuously improve its standards, staying ahead of market competitors.

This highlights the country’s commitment to sustainable agriculture, independent of EU regulations. The MSPO was developed several years before the EUDR, driven by the Malaysian government and industry’s commitment to mandatory sustainability in the palm oil sector. Even without the EUDR, MSPO would continue to enforce stringent sustainability standards.

Looking forward, MSPO deserves international recognition. The EU, known for its leadership in environmental regulation, should acknowledge and reward countries like Malaysia that share these environmental commitments. Recognising MSPO as a compliance tool for EUDR would reinforce the EU’s sustainability goals globally.

Such recognition would have immediate benefits for all stakeholders. Malaysian farmers and exporters would face reduced burdens and costs, while European importers would gain assurance of deforestation-free, EUDR-compliant palm oil. EU leaders would demonstrate a genuine commitment to new partnerships with developing nations, encouraging others to develop strong sustainability standards.

While there is always room for improvement, experts unanimously agree that MSPO is a high-quality standard fostering positive environmental change. It deserves recognition for its role in promoting sustainable palm oil.

Belvinder Sron is the CEO of the Malaysian Palm Oil Council 

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