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One of the most challenging issues confronting the oil palm industry is proving its commitment towards sustainable development. In actual fact, the industry has a long and proven track record of self-regulation and conformance with all contemporary regulations and legal requirements, as spearheaded by the large plantation companies and supported by very fruitful R&D efforts in both the public and private sectors.

There are numerous laws in Malaysia that protect the environment, and Good Agricultural Practices (GAP) are implemented as part of the sustainable development of the oil palm sector. The implementation of GAP is further strengthened with the introduction of the MPOB Codes of Practice (CoP) for the palm oil supply chain to help raise oil palm yield and to assure quality.

Now, external stakeholders representing buyers and consumers, with a broad interest in sustainability, are engaging with the industry. The challenge is to provide these stakeholders with the confidence that their concerns for sustainability are being systematically addressed.

The MPOB CoP were launched in 2007 with the objective of inculcating best practices and harmonising the industry practices throughout the supply chain in fulfilling standards of quality, food safety and sustainability. The CoP consist of seven parts starting from nurseries to smallholdings and estates, mills, palm kernel crushers, refineries and bulking facilities for palm oil and PKO and their products. The MPOB CoP audit is carried out in two stages i.e. prerequisite audit and the compliance audit. The MPOB CoP certificate is awarded to the compliant premises upon approval of the MPOB’s CoP Certification Committee.

The audit on the best practices under the codes focuses on the processes, such as planting of oil palms, safe usage of agrochemicals, milling of FFB, crushing of the PKs, refining of crude oil, etc., to ensure that the production of oil palm products is food safe, of high quality, and sustainable. The audit also emphasises on safety of workers, environmental requirements, biodiversity, conservation of wildlife and corporate social responsibility (CSR). The legal requirements, about 60 of them, to produce oil palm products are specifically stressed in one of the clauses. Some of the companies acknowledge that the implementation of MPOB CoP assist them in increasing their productivity.

The MPOB CoP certification scheme is a form of third party audit on the processes of the supply chain in terms of compliance to MPOB CoP, which the industry implemented in their premises. Daily running of the operations has become a routine habit such that the operators may become unaware of some of the weaknesses in the process. It takes a third party audit to actually highlight these weaknesses, which can be further reduced through corrective actions. The audit findings will also show differences from the standard practices. The managers of the premises must take the noncompliance and observations identified by the audit in a positive manner, and find ways to improve their operations thus leading to continuous improvement. The corrective actions which are proposed by CoP auditors can be adopted/adapted by the companies.