ISPO (Indonesian Sustainable Palm Oil) is a certification system on the sustainability of oil palm plantations, which is implemented by the Indonesian government through the ministry of agriculture. The certification is aimed to ensure that all oil palm plantations in Indonesia are managed according to the principles of sustainability, covering the aspects of economy, social, environment, and compliance with prevailing regulations.

ISPO becomes the first national standard of sustainable palm oil production established by producing country in the world. Its existence shows Indonesia’s commitment in developing palm oil industry, which is productive, responsible, and able to fulfill the global market demand that has been increasingly emphasizing the importance of sustainability aspect.

Brief history of ISPO

The Indonesian government began devising ISPO in 2009 as an instrument to improve the governance of the national palm oil industry. The program stemmed from the need to ensure that all operators of palm oil businesses implement plantation practices that comply with national regulations while also addressing environmental and social aspects.

ISPO was subsequently strengthened through various regulations, including:

• Presidential Instruction (Inpres) Number 6 of 2019 concerning the National Action Plan for Sustainable Palm Oil Plantations.
• Presidential Regulation (Perpres) Number 44 of 2020 concerning the Indonesian Sustainable Palm Oil Certification System.
• Minister of Agriculture Regulation (Permentan) Number 38 of 2020, serving as the technical regulation for certification implementation.

Through these regulations, ISPO has become not only a certification instrument but also part of the national strategy to strengthen the competitiveness of Indonesian palm oil in the global market.

ISPO certification goal

The implementation of ISPO serves several strategic objectives:

1. Enhancing the Competitiveness of Indonesian Palm Oil: ISPO certification helps boost market confidence in Indonesian palm oil products, particularly amidst growing consumer demand for sustainable products.
2. Supporting Emission Reduction Commitments: Through the adoption of good plantation practices, ISPO supports government targets to reduce greenhouse gas emissions and preserve natural resources.
3. Ensuring Regulatory Compliance: ISPO emphasizes the importance of business legality and adherence to the prevailing regulations in Indonesia.
4. Promoting Improvements in Industry Governance: Implementing ISPO standards helps foster a palm oil industry that is more transparent, efficient, and responsible.

Principles and criteria of ISPO

Based on Presidential Regulation Number 44 of 2020, ISPO certification for large plantation companies comprises:

• 7 principles
• 41 criteria
• 126 indicators

Meanwhile, a simpler scheme is applied to independent smallholders to facilitate easier implementation.

The seven key ISPO principles include:

• Legality of Plantation Business: Ensuring all business activities are licensed and comply with all prevailing laws and regulations.
• Implementation of Good Plantation Practices: Encouraging the adoption of Good Agricultural Practices (GAP) to enhance productivity and efficiency.
• Environmental and Natural Resource Management: Ensuring plantation activities prioritize environmental conservation, waste management, and the protection of natural resources.
• Labor Responsibility: Guaranteeing workers’ rights and the implementation of occupational health and safety standards.
• Social Responsibility and Community Empowerment: Fostering harmonious relationships between companies and surrounding communities.
• Transparency: Enhancing information openness regarding plantation business management.
• Continuous Business Improvement: Encouraging ongoing improvements across all aspects of plantation operations.
• What is the ISPO certification process?: ISPO certification is conducted by Certification Bodies accredited by the National Accreditation Committee (KAN) and appointed by the government.

In general, the certification process includes:

1. Submission of the certification application.
2. Review of documents and company compliance.
3. Field audit.
4. Evaluation of audit results.
5. Certification decision.
6. Periodic surveillance audits.
7. Special audits in the event of significant changes to the business scope.

Through this process, the government ensures that ISPO certification is granted only to business operators who meet all established requirements.

ISPO is now mandatory

A significant development in the governance of Indonesia’s palm oil sector is the implementation of the mandatory ISPO scheme.

This policy demonstrates the government’s commitment to building a sustainable national palm oil industry while reinforcing Indonesia’s position as the world’s largest producer of palm oil.

With this mandatory implementation, all palm oil industry players—including companies and smallholders—are expected to gradually meet the same sustainability standards.

Challenges and criticism of ISPO

Like other certification systems, ISPO faces a number of challenges in conducting the certification of palm sustainability.

Some stakeholders believe there is still a need for greater transparency, strengthened auditor capacity, and accelerated certification for independent smallholders. Furthermore, there is ongoing debate regarding the effectiveness of various schemes of sustainability certification in ensuring supply chains that are entirely free from deforestation.

Nevertheless, the government continues to refine the ISPO system to enable it to respond to evolving market dynamics and global demands.

ISPO advantages compared to other palm oil certifications

Amidst various internationally recognized standards of sustainability, ISPO possesses several advantages that make it unique and strategic for Indonesia’s palm oil industry.

1. Based on National Regulations: Unlike most voluntary certifications, ISPO is grounded in Indonesian laws and regulations. This ensures that all certification requirements align with national legal and policy frameworks.
2. Mandatory Nature: ISPO certification is compulsory for palm oil business operators in Indonesia. Consequently, its scope of application has the potential to be broader than that of voluntary schemes.
3. Tailored to Indonesian Conditions: ISPO standards are designed with consideration for Indonesia’s specific geographic, social, economic, and regulatory characteristics, making them highly relevant for implementation across the nation’s plantations.
4. Support for Independent Smallholders: ISPO provides a dedicated scheme for independent smallholders featuring adapted indicators. This fosters inclusivity and enables small-scale farmers to participate in the national sustainability system.
5. Strengthening the Position of Indonesian Palm Oil in the Global Market: Through the implementation of measurable national sustainability standards, ISPO serves as a vital instrument for addressing various issues frequently raised regarding Indonesia’s palm oil industry—such as deforestation, land governance, and supply chain sustainability.

ISPO as future foundation of Indonesian palm oil

As the world’s largest palm oil producer, Indonesia holds both a responsibility and a significant opportunity to demonstrate that palm oil production can align with sustainability principles.

ISPO serves as a key instrument in achieving this goal. By strengthening legality, governance, environmental protection, and social responsibility, ISPO not only safeguards the sustainability of the national palm oil industry but also enhances the competitiveness of Indonesian palm oil products in a global market that increasingly demands responsible business practices.

Looking ahead, the successful implementation of ISPO will be a crucial factor in maintaining export market access, improving the welfare of smallholders, and ensuring that the palm oil industry continues to serve as a sustainable driving force for Indonesia’s economy. (*)

---

WikiSawit. Apa Itu ISPO? Standar Sawit Berkelanjutan Indonesia yang Kini Wajib. https://gapki.id/id/wikisawit/knowledge-base/apa-itu-ispo-indonesian-sustainable-palm-oil/