AHMAD PARVEEZ GHULAM KADIR
DG MPOB
Palm oil is a product guaranteed to stir strong emotions. Found in everything from ice cream, to cosmetics, to biofuels, it’s a global phenomenon. However, the palm oil industry is also heavily implicated in a litany of environmental problems. Ahmad Parveez Ghulam Kadir, director general of the Malaysian Palm Oil Board (MPOB), opens up about balance between business success and natural preservation.
Like crude oil, palm oil is one of the planet’s most abundant and versatile commodities. Worldwide, a staggering 73.27 million tonnes of it were produced in 2020. In a typical Western supermarket, as many as half the products on sale may contain it. Three billion people in 150 countries use it, in many cases unknowingly, while current statistics suggest that globally, the average human consumes 8 kg of the stuff every year. The entire palm oil market is expected to reach a value of $93 billion by the end of 2021.
It’s also an extraordinarily efficient crop. An oil palm plantation produces ten times more oil per hectare than other oil crops, such as rapeseed or soy. Its resilience means it only requires replanting every 25 years, whereas other crops need this annually. These qualities have led to a situation in which one tenth of all the planet’s permanent cropland is turned over to palm oil production. Around 85% of this vast territory is in Malaysia and Indonesia. In many ways, this booming industry has been transformative. The production of such a successful export has benefitted local economies and helped lift rural populations out of poverty. This economic power led the International Monetary Fund (IMF) to encourage Malaysia and Indonesia to produce ever more of this miraculous substance, until, in 2020, palm oil constituted 38% of Malaysia’s agricultural output and 3% of its total GDP. Yet such expansion comes at a cost – the industry has become something of a folk-devil to environmental campaigners.
The World Wildlife Fund (WWF) estimate that an area the size of 300 football pitches is cleared each hour in tropical rainforests to facilitate palm oil production, an accelerant for global warming. Tree removal also causes soil erosion, while multiple species such as orangutans, elephants, rhinos, and tigers are being driven close to extinction through loss of habitat. Friends of the Earth have accused the palm oil industry of “ecocide,” while Green
peace has led a sustained campaign against palm oil production for the last decade. There are few more politically fraught spheres of business than this.
Having emerged from a background of research and development, to work at the forefront of Malaysian palm oil for the last 31 years, Ahmad Parveez Ghulam Kadir is fully aware of the debate his work arouses.
“This is such an important industry for our country,” he says, “the unique thing about Malaysian palm oil is that our crop is produced by half a million smallholders, with an average plot of only 3.5 hectares each, so it is really a national concern. But if course, it is full of challenges as well as opportunities.”
Since becoming director general of the Malaysian Palm Oil Board (MPOB), a government agency, in 2019, Ahmad has run six research divisions, four supporting divisions, and a total of 2,500 staff. One of his first moves was to set about implementing a more people-focused policy, honed in on an appraisal system to manage internal promotions. A big part of this is fostering a positive attitude to personal development, something Ahmad sees as key.
“We try to look at all aspects of an individual’s performance,” he says, “not just the key performance indicator.”
Ahmad also encourages an open forum on organisational decisions. Rather than adopting a top-down approach, he prefers team members to give their views, so that proposals can be decided on collectively. He has implemented a system for staff to provide feedback on issues they face, twice a year, to ensure that employees at all levels feel that their voice is being heard.
“It is important to us that everybody feels a sense of belonging in our organisation,” he says. “Everybody is important.”
The MPOB occupies a wide-ranging role within the industry and part of its remit is regulation. “Of course, we provide research and development services,” Ahmad explains, “but we also strategise.” This work centres around examining challenges the industry may face and forming a plan to tackle them. Without that, continued growth would be impossible.
Like everything else, palm oil has had to withstand the devastating impacts of the coronavirus pandemic. Malaysia locked down in March 2020 and this posed great difficulties to a sector with such a diverse and far-flung supply chain. “When you rely on smallholders so heavily,” he explains, “transport and logistics are such key elements. It was very important for us to have government support to keep the supply chain open.”
However, there have been other significant challenges. Alongside persistent environmental issues, the US banned imports of palm oil from Malaysian producer FGV holdings in October 2020. This decision was made after a year-long investigation revealed “restriction of movement, isolation, physical and sexual violence, intimidation and threats, retention of identity documents, withholding of wages, debt bondage, and abusive living and working conditions.” FGV is a major player in the Ma
In Malaysia, palm oil is a national
concern
laysian market, responsible for 15% of annual palm oil production.
Ahmad states that when this occurred, it was very important to respond to the crisis holistically. “We think of the MPOB and its affiliates as a family,” he says. “So, a problem for one of them is a problem for all of us. It was important to tackle this as an organisation.” As a result, measures have been implemented to improve worker conditions at FGV, with a special emphasis on housing.
On the environmental side, a key policy development has been that of the Malaysian Sustainable Palm Oil certification, known as MSPO, which is government-enforced and now accredited to 87% of Malaysian producers. Under its stipulations, the rate of deforestation is now decreasing, while schemes have also been put in place to protect particularly vulnerable species, including the pygmy elephant and Borneo orangutan. Whether these measures are enough to assuage international concerns remains to be seen, but they certainly represent a step in the right direction.
Looking to the future, the MPOB has identified four key areas on which to focus. Naturally, the stand-out of these is sustainable development, alongside food safety and nutrition, yield performance and mechanisation. With palm oil continuing to expand its industrial and energy uses, alongside its many pre-existing applications, the future for the industry certainly appears fruitful, if managed well. By channelling their collective energies into these areas, Ahmad fully expects the MPOB to continue to thrive.
We think of the MPOB and its affiliates as a family