Impact of Indonesian Sustainable Palm Oil (ISPO) Certification to Environmental Behavior of Palm Oil Plantation Companies

Abstract

In order to realize sustainable palm oil plantations and to overcome negative impacts of it, Indonesian government has required Indonesian Sustainable Palm Oil (ISPO) certification to palm oil plantation companies. After 10 years of implementation, it is important to know the impact of ISPO certification on environmental behavior of palm oil plantation companies, especially related to deforestation and land fires. Using qualitative method, this study investigates environmental behavior changes in seven palm oil plantation company related to deforestation, and land fires as results of ISPO certification and to analyze the cause of the changes. This study showed that the implementations of ISPO certification are able to change the company's environmental behavior to reduce forest conversion in concession areas and increase conservation areas as a fulfillment of ISPO principles and criteria. The change of those company’s environmental behavior caused by the pressure to issue ISPO regulation, the influence of the company's internal stakeholders in responding and understanding ISPO, and encouragement to get easy finance  access from banks.