Update on RSS trials in Sumatra

Field trials of the RSS (Responsible Sourcing from Smallholders) framework with oil-palm smallholders in Sumatra began earlier this year in March. The trials are already yielding tangible outcomes and useful lessons that will inform the refinement of the RSS framework for wider application in Indonesia and beyond. An early observation is the variation in capacity that can be found among contrasting types of producer organisation for implementing different phases of the framework.

RSS field testing in Sumatra has been a multi-partner process coordinated by SNV, SHARP’s Regional Focal Point for Southeast Asia (click here for previous update). Two types of smallholder organisation have been selected to reflect the diversity of Indonesia's palm oil sector:

  • Model 1 - Production company working with ex-scheme smallholders where the company functions as the Implementing Entity for RSS.
  • Model 2 - Associations of completely independent smallholders where the association acts as the Implementing Entity.

 

Model 1 - Company working with smallholders

The company involved, ProSympac, is building a mill in Jambi Province, Sumatra to produce biodiesel for the European market, and to satisfy the requirements of this market they must achieve ISCC certification. ProSympac will source from established smallholders and use RSS as a stepwise approach towards achieving this certification standard.

Here RSS has been introduced with good results at nearly all the steps of the framework. ProSympac have demonstrated good capacity to scope and assess sustainability risks and farmers' needs. However, because ProSympac began the process before the completion of their mill they did not, particularly in the early stages of the process, have the field staff or budget required to implement RSS without third-party support (in the form of SHARP partner SNV). Limited field staff capacity also had an impact on their ability to deliver support to address farmer’s needs, although as they recruit more staff this capacity is improving markedly.

Model 2 - Completely independent smallholders

Two associations of independent smallholders were involved in the field test, Asosiasi Anugrah and Assosiasi Mekar Sari. Their long-term aim is RSPO certification and they see implementation of the RSS framework as a step towards this goal. The resources of the associations are limited, in terms of both working capital and staff with the requisite education. This restricted their capacity to function as the Implementing Entity taking responsibility for RSS implementation. Consequently they require substantial assistance from SNV.

These independent smallholder groups have demonstrated relatively good capacity to implement measures to mitigate certain risks. Their common buyer, Inti Indosawit Subur mill, has asked smallholders to provide evidence that their plantations have been established without destruction of High Conservation Values (HCVs) and that they comply with local legal requirements. Consequently there has been a strong market-driven incentive for the associations to support their members to obtain STD-B, a form of registration documentation issued by the municipality. Most members still face financial and political barriers to achieving this. Indeed, although the majority understand what is required of them, to date only a minority have been able to comply and just one of the 33 farmers could claim environmental management and monitoring capability.

The associations also demonstrated a moderate capacity to implement measures to support their members to adopt improved agricultural practices. However, for all other steps of the RSS framework greater capacity is needed and the associations are strongly reliant on SNV’s support to follow the RSS guidance and document the outcomes at each step.

Lessons to take from the field tests

A challenge in both models was forming an Advisory Board. Getting local stakeholders to commit staff to serve on an Advisory Board proved slow and difficult, although with SNV’s support, the NGOs WWF Indonesia and Yayasan Setara agreed to participate at both sites. There were concerns about cost implications of formally co-opting local government on to an Advisory Board. A flexible form of engagement with stakeholders may be useful.

The other key lesson is that independent smallholder associations may need more capacity-building than companies to act as the Implementing Entity, given how the role and the guidance materials for IEs have developed so far. Possible solutions to this constraint include:

  • Redrafting field guidance materials to match the capacities and educational background of independent smallholder associations.
  • Scaling up third-party support through supply chain companies, external NGOs, Local Producer Groups or Public Service provision through relevant government agencies where feasible.
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