Impact of palm oil sustainability certification on village well-being and poverty in Indonesia

The Roundtable on Sustainable Palm Oil (RSPO) has emerged as the leading sustainability certification system to tackle socio-environmental issues associated with the oil palm industry. To date, the effectiveness of RSPO certification for achieving its socioeconomic objectives remains uncertain. We evaluate the impact of certification on village-level well-being across Indonesia by applying counterfactual analysis to multi-dimensional government poverty data. We compare poverty across 36,311 villages between 2000 and 2018, tracking changes from before oil palm plantations were first established to several years after plantations were certified. Certification was associated with reduced poverty in villages with primarily market-based livelihoods, but not with those in which subsistence livelihoods were dominant before switching to oil palm. We highlight the importance of baseline village livelihood systems in shaping local impacts of agricultural certification, and assert that oil palm certification in certain village contexts may require additional resources to ensure certification’s socioeconomic objectives are realised.