General Lecture : Contributions of Palm Oil Plantation on National Economy and Its Impact on Human Rights

ELSAM, Bogor – ELSAM held first series of IMPACT (Indonesian Movement for Plantation and Human Rights Transformation Training) for the civil society organizations on 20 – 24 February 2017 with the general lecture given by the Chairman of National Commission on Human Rights 2007 –  20017, expert staff of Deputy V Presidential Staff Office, in Bogor. Ifdhal Kasim gave the lecture on business and human rights in the context of palm oil plantation.

The strong correlations between palm oil plantation and environment as well as human rights issue should have got a response from the Government and Companies by anticipating and avoiding possible negative impacts of palm oil plantation growth. In addition, the government should provide an effective conflict resolution mechanism as well as restore the victims’ rights that were violated by the palm oil plantation business practices. As stated in UN Guiding Principles on Business and Human Rights(UNGP), Government and companies should fulfil their responsibilities in promoting and respecting human rights.

 “If seen from the economic development perspective, the palm oil plantation industry is indeed one of the key industries in Indonesian economy. It contributes to regional development, reducing poverty through cultivation, export, and creating employment. However, who really profits and owns this industry?” said Ifdhal in the opening of his general lecture.

Ifdhal explained that in 2008, around 48 percent of palm oil plantations are owned by private companies, 41 percent belong to small farmers, and the rest  10 percent are owned by the government. Private companies are the largest producers of palm oil in Indonesia, which produce 9,4 million tons of palm oil based on 2008 calculation. There are 25 dominant big companies that dominate this palm oil industry in Indonesia, such as Sinar Mas Group, Wilmar Group, GAR, Salim Group, etc.

The need to increase palm oil production requires more extensive land conversions. This condition threatens the existence of village lands which are within the area of Land Cultivation Permits (HGU). Meanwhile, the locals then only become labour in their own lands and the Government agrees with it by keep issuing the HGU.

In the context of land clearing or running the palm oil industry, the companies have not prioritized the Instrument Free, Prior, and Inform Consent (FPIC), and their dialogue mechanism. Therefore, when an armed conflict emerged, they still use excessive and repressive force from the Government, such as police and military force. This kind of approach is available because the Government considers that palm oil industry currently is a vital industry thus deserves particular facility in terms of special security. Besides using the repressive tools from the Government, the companies also use private security services to secure the production of the palm oil industry. Another problem to be concerned with is the policy used in the Dutch colonial period which is still being applied today in terms of forestry and plantation conflicts. The policy, although not written legally, states that if the ownership of a land could not be proven, then the ownership falls to the government.

“The rapid expansion of palm oil surely impacts on human rights. This can be illustrated by the fact that previous human rights related conflicts emerged from the development of infrastructure such as eviction, yet today the plantation sector triggers and continues to result in massive conflicts. Development of human rights regime within the business world in 2005 – 2008 mentioned how important companies in participating to protect human rights. In 2011, UN has arranged a framework so that companies wouldn’t be involved  in human rights violation” explained Ifdhal.

Ifdhal further explained that companies must formulate a policy statement that shows their commitment to respect human rights. Next, companies also need to conduct “human rights due diligence” such as assessments toward companies operational potential or actual impacts on human rights; prepare effective mitigation to avoid conflicts, take conflicts’ precaution steps for land clearing by making sure it is clear, fair, and respectful; conduct Free, prior and Informed Consent (FPIC) dialogue between stakeholders and locals as well as monitor the implementation of assessment result. Furthermore, companies are also required to build communication and dialogue with government (either central or local government) and integrate the assessment result into company operational policy.

IMPACT first training was attended by 20 participants from various civil society organizations in Indonesia. This was series of trainings for civil society organizations that engage on human rights advocacy issues in the context of palm oil plantation.