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Sustainability Certification and Palm Oil Smallholders’ Livelihood: A Comparison between Scheme Smallholders and Independent Smallholders in Indonesia

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  • Hidayat, Kurniawati Nia
  • Glasbergen, Pieter
  • Offermans, Astrid

Abstract

Most sustainability certifications in Indonesia are developed by Northern-based businesses and NGOs to regulate the production of agricultural commodities in the South. However, research still shows a lot of uncertainty about what sustainability certifications imply for the livelihood of smallholder farmers. Given these uncertainties, this paper explores the potential of certifications to improve the livelihood of smallholder farmers. To achieve this objective we developed an amended livelihood framework applied to an exploratory study of Indonesian smallholders who participate in the Roundtable of Sustainable Palm Oil (RSPO). Although access to markets and vulnerability are not improved through certification, indirect effects through organizational changes increase productivity. If certification schemes are weakly institutionalized, farmers will easily shift to a more profitable way of production. Further analysis is needed to discover the balance between the ethical aspects of certification while improving economic profitability for participating smallholders.

Suggested Citation

  • Hidayat, Kurniawati Nia & Glasbergen, Pieter & Offermans, Astrid, 2015. "Sustainability Certification and Palm Oil Smallholders’ Livelihood: A Comparison between Scheme Smallholders and Independent Smallholders in Indonesia," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 18(3), pages 1-24, September.
    • Handle: RePEc:ags:ifaamr:208400
    DOI: 10.22004/ag.econ.208400
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    2. Glasbergen, Pieter, 2018. "Smallholders do not Eat Certificates," Ecological Economics, Elsevier, vol. 147(C), pages 243-252.
    3. Arieska Wening Sarwosri & Oliver Mußhoff, 2020. "Are Risk Attitudes and Time Preferences Crucial Factors for Crop Diversification by Smallholder Farmers?," Journal of International Development, John Wiley & Sons, Ltd., vol. 32(6), pages 922-942, August.
    4. de Vos, Rosanne E. & Suwarno, Aritta & Slingerland, Maja & van der Meer, Peter J. & Lucey, Jennifer M., 2023. "Pre-certification conditions of independent oil palm smallholders in Indonesia. Assessing prospects for RSPO certification," Land Use Policy, Elsevier, vol. 130(C).
    5. Wening Sarwosri, Arieska & Mußhoff, Oliver, 2019. "Can crop diversification of perennial crop by smallholder farmers explained by risk attitudes and time preferences?," EFForTS Discussion Paper Series 28, University of Goettingen, Collaborative Research Centre 990 "EFForTS, Ecological and Socioeconomic Functions of Tropical Lowland Rainforest Transformation Systems (Sumatra, Indonesia)".
    6. Ahmed Zainul Abideen & Veera Pandiyan Kaliani Sundram & Shahryar Sorooshian, 2023. "Scope for Sustainable Development of Small Holder Farmers in the Palm Oil Supply Chain—A Systematic Literature Review and Thematic Scientific Mapping," Logistics, MDPI, vol. 7(1), pages 1-24, January.
    7. Ogahara, Zoë & Jespersen, Kristjan & Theilade, Ida & Nielsen, Martin Reinhard, 2022. "Review of smallholder palm oil sustainability reveals limited positive impacts and identifies key implementation and knowledge gaps," Land Use Policy, Elsevier, vol. 120(C).
    8. Nurul Fathiah Aziz & Norshamliza Chamhuri & Peter J. Batt, 2021. "Barriers and Benefits Arising from the Adoption of Sustainable Certification for Smallholder Oil Palm Producers in Malaysia: A Systematic Review of Literature," Sustainability, MDPI, vol. 13(18), pages 1-11, September.
    9. Norhana Abdul Majid & Zaimah Ramli & Sarmila Md Sum & Abd Hair Awang, 2021. "Sustainable Palm Oil Certification Scheme Frameworks and Impacts: A Systematic Literature Review," Sustainability, MDPI, vol. 13(6), pages 1-10, March.
    10. Ahearn, Mary Clare & Armbruster, Walt & Young, Robert, 2016. "Big Data's Potential to Improve Food Supply Chain Environmental Sustainability and Food Safety," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 19(A), pages 1-18, June.
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    12. Apriani, Ernawati & Kim, Yeon-Su & Fisher, Larry A. & Baral, Himlal, 2020. "Non-state certification of smallholders for sustainable palm oil in Sumatra, Indonesia," Land Use Policy, Elsevier, vol. 99(C).
    13. Nia Kurniawati Hidayat & Astrid Offermans & Pieter Glasbergen, 2018. "Sustainable palm oil as a public responsibility? On the governance capacity of Indonesian Standard for Sustainable Palm Oil (ISPO)," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 35(1), pages 223-242, March.
    14. Wening Sarwosri, Arieska & Wegmann, Johannes & Mußhoff, Oliver, 2018. "Encouraging rainforest preservation by smallholders: An ex-ante policy evaluation," EFForTS Discussion Paper Series 23, University of Goettingen, Collaborative Research Centre 990 "EFForTS, Ecological and Socioeconomic Functions of Tropical Lowland Rainforest Transformation Systems (Sumatra, Indonesia)".
    15. Rudolf, Katrin & Hennings, Nina & Dippold, Michaela A. & Edison, Edi & Wollni, Meike, 2021. "Improving economic and environmental outcomes in oil palm smallholdings: The relationship between mulching, soil properties and yields," Agricultural Systems, Elsevier, vol. 193(C).
    16. Jelsma, Idsert & Woittiez, Lotte S. & Ollivier, Jean & Dharmawan, Arya Hadi, 2019. "Do wealthy farmers implement better agricultural practices? An assessment of implementation of Good Agricultural Practices among different types of independent oil palm smallholders in Riau, Indonesia," Agricultural Systems, Elsevier, vol. 170(C), pages 63-76.
    17. Edi Purwanto & Hery Santoso & Idsert Jelsma & Atiek Widayati & Hunggul Y. S. H. Nugroho & Meine van Noordwijk, 2020. "Agroforestry as Policy Option for Forest-Zone Oil Palm Production in Indonesia," Land, MDPI, vol. 9(12), pages 1-34, December.
    18. Victoria A. Maguire-Rajpaul & Vinesh M. Rajpaul & Constance L. McDermott & Luís Fernando Guedes Pinto, 2020. "Coffee certification in Brazil: compliance with social standards and its implications for social equity," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 22(3), pages 2015-2044, March.
    19. Gallemore, Caleb & Jespersen, Kristjan & Olmsted, Paige, 2022. "Harnessing relational values for global value chain sustainability: Reframing the roundtable on sustainable palm oil's offset mechanism to support smallholders," Ecological Economics, Elsevier, vol. 193(C).
    20. Kaihula P. Bishagazi, 2021. "Sustainable Local Economic Development in Tanzania: Exploring Economic Challenges in Growing the Economy," Journal of Public Administration and Governance, Macrothink Institute, vol. 11(2), pages 210228-2102, December.
    21. Rowland, Dominic & Zanello, Giacomo & Waliyo, Edy & Ickowitz, Amy, 2022. "Oil palm and gendered time use: A mixed-methods case study from West Kalimantan, Indonesia," Forest Policy and Economics, Elsevier, vol. 137(C).
    22. Marola, Elena & Schöpfner, Judith & Gallemore, Caleb & Jespersen, Kristjan, 2020. "The bandwidth problem in telecoupled systems governance: Certifying sustainable winemaking in Australia and Chile," Ecological Economics, Elsevier, vol. 171(C).
    23. Kleemann, Linda, 2016. "The relevance of business practices in linking smallholders and large agro-businesses in Sub-Sahara Africa," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 19(4), August.
    24. Jelsma, Idsert & Schoneveld, G.C. & Zoomers, Annelies & van Westen, A.C.M., 2017. "Unpacking Indonesia’s independent oil palm smallholders: An actor-disaggregated approach to identifying environmental and social performance challenges," Land Use Policy, Elsevier, vol. 69(C), pages 281-297.

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