Campaigners say that the industry is responsible for deforestation of tropical rainforests and human rights abuses and have initiated consumer boycotts of palm oil, which is found in everything from pizza to lipsticks.
However, such campaigns are hindering the industry's efforts to achieve sustainability certification and develop a market for certified sustainable palm oil (CSPO), top palm oil producers said during the Reuters Next conference.
"The issue is how do we regain the trust we seemed to have lost?" asked Olivier Tichit, Director of Sustainable Supply Chain at Musim Mas, adding that the industry has a high level of transparency compared to other commodities.
The panelists said sales of more expensive sustainable palm oil, certified by bodies including the Roundtable on Sustainable Palm Oil (RSPO), are still lacking.
To boost their green credentials, both Malaysia and Indonesia have implemented national sustainability standards, but NGOs say these are not stringent enough.
"We can't afford for people to continue undermining efforts to get certification, because for everything that we do it seems like it is one-step forward and two-steps back. It will disincentivize others (to) get on board," said Mohd Haris Mohd Arshad, Managing Director at Sime Darby Oils, part of the world's largest palm oil company by land size and the largest producer of CSPO.
Ravi Muthayah, Secretary-General of Malaysia's Plantation & Commodities Ministry called for greater recognition of industry efforts instead of being singled out for driving deforestation.
"It's better than not having any sustainability standards and causing further damage, no matter what crop you're in," Muthayah said.
