Social and Environmental Correlates of Palm Oil Certification in Indonesia

Indonesia is losing more of its forests and, in Kalimantan, palm oil is contributing to increasing rates of forest loss. The Roundtable on Sustainable Palm Oil (RSPO) is a conservation scheme that harnesses market-based principles to internalize negative social and environmental externalities associated with palm oil production, through forest certification. To date, few studies use quantitative data to examine these certification schemes. This paper makes use of concession data and village-level environmental, economic, legal, and social data to identify correlates of RSPO in Kalimantan. Significant variables include: forest cover, total village carbon, average slope, proximity to markets, village protected areas, population density, and malnutrition. I find that RSPO concessions are generally correlated with suitable oil palm cultivation characteristics. However, RSPO concessions are somewhat correlated with higher total village carbon and negatively correlated with malnutrition, suggesting reduced potential for social and environmental co-benefits. The analysis reported here can be viewed as an important first stage in more targeted evaluations of RSPO and other certification schemes