The Human Side of the Problem

Palm oil is one of the key commodities at the centre of the global forced labour problem. While the environmental impact related to palm oil has been on the industry’s radar for some time, human rights and forced labour abuses in the supply chain of the world’s most traded oil have long been ignored. In 2018, we commissioned a report by the Fair Labor Association to look at the extent of this complex issue, as well as the role of the consumer goods industry in driving change and eradicating the problem. The report revealed many indicators of forced labour associated with the sourcing of palm oil, including debt bondage, passport retention, recruitment fees, and restricted worker movement — abuses all addressed by our Priority Industry Principles.

The palm oil trade spans across the globe but there are regional hotspots where focused action must take place. In Southeast Asia, Malaysia, and Indonesia are leading producers, together accounting for 86% of global production and employ as many as 3.5 million workers to maintain plantations and harvest the oil. Meanwhile, Colombia, South America’s largest palm oil producer, plans to increase its production six-fold by 2020. The CGF has hosted multi-stakeholder advocacy events in these countries and others to engage our members, suppliers, and recruiters in a common dialogue on the issue.

“Addressing forced labor in the palm oil sector, particularly in Indonesia and Malaysia, is a critical endeavor in order to protect and improve the lives of millions of workers. Labor issues in palm oil production are increasingly the focus of advocates for sustainability, government leaders around the world, and individual consumers. The Consumer Goods Forum has the opportunity to play a leadership role in meeting the challenges ahead.”

Fair Labor Association, Assessing Forced Labor Risks in the Palm Oil Sector in Indonesia and Malaysia (2018) 

People Positive Palm Project

Due to the global prevalence of palm oil production, HRC members recognise the high potential for human rights abuses in their supply chains if they are purchasers of palm oil. As such, the HRC has launched the People Positive Palm Project designed to drive collaboration between consumer goods companies and palm oil suppliers in Malaysia to address the issue of forced labour in the Malaysian palm oil sector.

The project aims to foster collective action and advocacy on key issues faced in this industry – including a focus on understanding, addressing, and preventing recruitment fees – with the support of the Fair Labor Association (FLA), the International Organisation for Migration (IOM), and The Remedy Project. The project offers two complementary tracks in which all palm oil suppliers with operations in Malaysia are invited to participate in based on their individual needs, focusing on:

  • Learning, which offers a  series of no-cost collaborative workshops to build and share knowledge on how to address key risks; and/or
  • Engagement, which offers tailored advisory services for suppliers to strengthen their management systems for responsible recruitment.  

Both tracks will contribute towards collective advocacy to address forced labour in the Malaysian palm oil sector, particularly within Bangladesh, Indonesia, and India migration corridors, and support further learning to scale into other geographies and categories from HRC members. 

The project was launched during a series of meetings and workshops in Kuala Lumpur in October 2022, where HRC members, 13 participating Malaysian palm oil suppliers, and other stakeholders met to kickstart the project. and help transform the Malaysian palm oil labour market.

The People Positive Palm Project will use the HRC’s Human Rights Due Diligence Maturity Journey Framework for Palm Oil Supply Chains as a reference document for its work, complementing other existing resources and initiatives.

Interested stakeholders in Malaysia are invited to reach out to the HRC team at social@theconsumergoodsforum.com for more information about how to participate.

Learn More

Download the Coalition’s Forced Labour-focused Human Rights Due Diligence (HRDD) Maturity Journey Framework for Palm Oil Supply Chains.

Combining Coalition Efforts

The HRC’s efforts around palm oil are also strengthened by the agenda of CGF’s other working group on palm oil in our environmentally minded Forest Positive Coalition, as well as the Sustainable Supply Chain Initiative (SSCI), which promotes good social and environmental practices in global supply chains by benchmarking and recognising third-party audit programmes and certification schemes. Together, these groups comprehensively approach the issue of palm oil to address the human rights, environmental and supply chain management concerns which make it a high-risk commodity. Still, our members know that palm oil is here to stay, and we therefore have the obligation to make sure it is sourced in a socially responsible manner.