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Case Study

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Subject:
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Contents

Executive summary.....................................................................................................................................4
Answers to the questions:............................................................................................................................4
Problem statement.......................................................................................................................................8
Alternatives.................................................................................................................................................8
Conclusion...................................................................................................................................................9
Action Plan..................................................................................................................................................9
References.................................................................................................................................................11
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Executive summary
This case concentrates on one of the product whose demand has been increasing day by day
which is palm oil. There are various uses of this palm oil and various countries used it in their
products such as soap, detergent, cleaning liquids, biofuel, etc, .In developing countries like
Indonesia as well as Malaysia, the production of palm oil industry is providing economic
benefits and provides approximately two million jobs. (Koh & Wilcove, 2009). But, there are
various disadvantages which affects many ecosystems as well as various biodiversity which
exists among these ecosystems. The plantation of this palm oil emits approximately 20% of gases
like carbon dioxide and various green house gases. (Subramaniam, 2016). There is
approximately 1.5 billion tons of carbon which is released every year in the environment and as a
result there is change in climate. Even though, at this stage it seems that the palm oil production
is providing benefits to economies of nations, but in few years it might affect the economy of
nation in a negative way.

Palm oil is considered as an important product in lives of many individuals. This product is
available at low cost and results it is high demand. This palm oil is found in various products
ranging from food, soaps, liquids, biodiesel. There are various uses of these products and
companies are increasing its production as per the requirements. There are many facts about
palm oil which everyone should be aware about. Palm oil has versatile properties such as it has
very huge point of melting which results into making it very smooth as well as easy for
spreading it anywhere.

In this report, various problems have been identified which are caused due to increasing
production of palm oil such as destruction of rainforest for the production of palm oil is
discussed and its effects on climate change. It also describes various alternative solutions which
can help in sustaining of Palm oil. The questions to these case studies are answered in detailed.
The conclusion is written about this case and at the end of this case, various action plans have
been discussed which can help to sustain the palm oil.
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Answers to the questions:

Question 1: The word “Sustainable” is tossed around a lot. What does it mean to you?

In this case study, the sustainable word has been used a lot. The word Sustainable means ability
to maintain the product or land as it exists and causes little or no harm to environment. In this
case study, focus is made on importance of maintaining the forest is discussed and how it can be
sustained. Initially the focus was not made on forest, but increasing problems have opened the
eyes and sustaining of forest has been considered as an important aspect around the world. The
increasing demand of palm oil is reason for cutting down the forest. It is important for every
company to have sustainability at the uniform rate as well as level, as this type of issue might
result into controversy and which might be harmful for company. The focus should be made for
sustaining the existing environment as it is by maintain it in proper way as well as avoiding using
of any products which can be harmful for environment.

Question 2: Is it fair for environmentalists to single out companies like unilever and Nestle
that are more socially responsible than most and which are relatively small consumers of
palm oil, or is this justified simply as a matter of strategy?

According to me, it is not fair enough for environmentalists to single out companies which are
more socially responsible such as Nestle and Unilever. It is responsibility of all of us to maintain
the sustainability of forest. Even though, there are few companies or an industry which comes
out at and share a high amount of pollution as compared to others. But, it is the responsibility of
each and every individual around the world to overcome of this environmental problem. The
companies like Unilever and Nestle are using Palm oil in products which are ultimately used by
us, The increasing demand of Products inclusive of palm oil is because, we as consumer are
increasing demand for those products. Hence, it is clear that it is not to be justified as a strategy
matter. Companies may be seemed to be more responsible, but we all are responsible for
environmental problems.
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Question 3: How far must corporations go to ensure that the various ingredients used in
their products are produced in an environmentally satisfactory way? What if there aren’t
any truly sustainable options?

It is important for corporations to ensure about the product ingredients which are used in
production are environmental friendly. The company should make sure that suppliers are using
the right way and not causing any harm to environment for producing those supplies which are
needed by company. It is important for every company to be socially responsible towards the
sustainability of an environment. In this case study, Nestle took effective steps by suspending all
the supplies which were purchased from an Indonesian conglomerate as it was known that illegal
cutting down f forest was done by them and a special auditor was appointed by Nestle to keep
track of supply chain in company. Even if there are not any sustainable options, it is duty of an
every individual as well as an industry to figure out what can be done in order to save
environment such as Planting of more trees, be against deforestation, etc.

Question 4: can monitoring and self regulation by industry groups like the Roundtable
effectively address environmental issues, or will outside pressure always be needed? Was
Greenpeace right to act as it did, or should it have tried to work with the companies in
question?

The environmental issues and concerns can easily be addressed by monitoring and self regulating
those issues by industries in an effective way. It is important to keep track of things on regular
basis, which will ultimately help an industry to understand the rising problems or issues in near
future. An industry group like Roundtable should self-regulate each and every thing and make
sure that it is clean as well as fine.

Outside pressure is important and most required while monitoring as well as self-regulating
system. If there are no specific morals or objectives, the company will face many problems
sooner or later. Outside pressure from customers as well as from employees helps to understand
what the actual problem is. If there is no outside pressure, feedback will not be received from
customers or employees, which will never help in understanding what an actual problem or issue
is. Maintaining of proper self regulation as well as monitoring help in understanding of issues
and make customers satisfied as well as happy. The Greenpeace did not act in the correct way.
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The companies should have been contacted before creating that video which caused so many
problems. The negative response from public due to their video might have affected the sales of
company as customer stops buying their goods or products. The Greenpeace should have gone
directly went to the head of company and should have discussed the issue with them rather than
using the mode of public.

Question 5: Preventing deforestation is important, but once previously forested land has
been cleared, whether six months ago or sixty years ago, is there anything wrong about
using it to produce palm oil now?

It is not advised to use the forested land to produce palm oil. The land for the production of palm
oil requires proper cleaning as well as procedure for preparing that land suitable for the
plantation of palm oil. The deforestation caused for producing the palm oil is responsible of high
amount of carbon dioxide emission which is harmful for environment. The land is completely
drained if it was on peat land. (Smit et al., 2013). This type of Peat lands stores high amount of
carbon dioxide which ultimately brings the changes in climate. Deforestation is important to
prevent as well as it is important to preserve the environment from emission of high amount of
carbon dioxide gas. Rather than using it for production of palm oil, the focus should be made on
planting more and more trees on that land.

Question 6: Used as a biofuel, palm oil reduces our dependence on petroleum. How do we
balance that against deforestation?

The palm oil helps in reducing the dependency on petroleum by using it as a biofuel or biodiesel,
but it is important to maintain balance against its uses and deforestation. The increasing demand
for palm oil is done by destroying high amount forest land which is harmful for environment.
The uses of palm oil in other products should be minimized as well as various alternatives should
be provided where it can be used in place of palm oil. The increasing use of petroleum results
that in future the reserves of petrol will be finished and alternative should be used. In that case,
use of palm oil as biofuel will be greatly beneficial.
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Question 7: Developing countries like Indonesia are responding to increased demand for
palm oil by western consumers. Is it fair to the producer nations to restrict the expansion of
this industry?

It is fair enough to the producer’s nation to restrict the expansion of this industry as when a
company tries to expand this type of industry around the world, will ultimately result into cutting
down of forest to fulfill the demand. As we all know, Growing of trees and forests takes years to
grow. (P, 2013). It is fair to respond to demand of particular nation, as in this case Indonesia
should only take care of its own nation’s demand at this point of time because there is some
limitation of cutting down to forest. According to report, high amount of deforestation is done in
Indonesia as well as in Malaysia as they trying to meet the demand of whole world. If the
companies which produces palm oil starts fulfilling the demands of around the world, will start
cutting down the tress at a rapid speed which will result into shortage of palm oil sooner as
growing of trees takes longer. If developing countries like Indonesia start fulfilling the
increasing demand around the world, the forest will be destroyed at a rapid speed, whereas
growing of forest takes years as well as decades.

Problem statement
The increasing demand of palm oil around the world is causing many problems as the
deforestation is increasing due to high demand of Palm oil. There is approximately 1.5 billion
tons of carbon which is released every year in the environment and as a result there is change in
climate. This happens because the areas which are deforested get heated more faster as well as
there is high temperature. Due to this the amount of heavy rainfall is anticipated as high
temperature helps in enhancing the evolution of clouds. There are various problems which are
caused due to high demand of Palm oil which are discussed below:

 Increasing demand of palm oil is turning down the forest land into agricultural land
suitable for plantation of palm oil. Hence, destruction of rainforest is one of the major
problems.
 The destruction of rainforest results in to change in climate, as cutting down of rainforest
releases the carbon dioxide gas which affects and bring change in climate.
 Lack of regulation about the sustainability of Palm oil.
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 Lack of awareness among population about the problem caused by production of palm
oil.

Alternatives
Every problem has a solution as well as alternative. It is important to find a alternative before
reaching at the extreme of the problem. In this case, the high demand of calm oil is resulting into
deforestation which is harmful for environment. Hence, it is important to find out various
alternatives which can be followed in order to maintain the sustainability of palm oil:

 The demand of palm oil should be controlled by bringing best alternative product which
can be used in the replacement of palm oil.
 The strict rules should be made by government in order to save the destruction of rain
forest and bring awareness among individuals by various campaigns’ about the effects
of deforestation and how can be harmful to everyone.
 The focus should be made on using of palm oil on various products like Biofuel.

Conclusion
It is concluded that palm oil seems to be very useful product as well as the demand of this
product is increasing day by day. But, the production of this most common and demanded palm
oil is very harmful for environment. While undertaking production of the palm oil, many forests
as well as Peat lands are destroyed which are causing many problems in ecosystems and there
exists loss of biodiversity.

The deforestation caused for producing the palm oil is responsible of high amount of carbon
dioxide emission which is harmful for environment. It is recommended to use the Sustainable
palm oil production which means production of palm oil should be done on existing land only
and no more deforestation should be done. The high amount of removal of tress results into
various amount of gases and bring changes in the habitation of biodiversity as well as its loss.
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The various solutions should be considered such as decreasing the use of palm oil and providing
various alternatives which can be used in place of palm oil. The deforestation should be reduced
and the production of palm oil products should be done on existing plantation only. Even though,
it seems that en economy is getting benefit from the production of palm oil, but it will have
negative impact on economy in future.

Action Plan
It is important to preserve environment by taking following actions which can help in saving the
environment :

 It is important for every company to source a sustainable palm oil which is 100%
certified.
 To make sure that all the suppliers are members of RSPO.
 Bring awareness among employees as well as all individuals about the problems or
concerns about increasing demand of palm oil.
 Implementation of special auditor to make sure that supplier of palm oil follows the legal
policies in sustaining palm oil.
 The waste which derives from the mills of palm oil should be returned back to soil as it
can be used as other form of fertilizer.
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References
Elias, J., Richards, K., & Bourg-Meyer, V. Palm Oil 2016.

Koh, L., & Wilcove, D. (2009). Oil palm: disinformation enables deforestation. Trends In
Ecology & Evolution, 24(2), 67-68. doi: 10.1016/j.tree.2008.09.006

P&G, Colgate commit to no deforestation in palm oil supply chain. (2014). Focus On
Surfactants, 2014(7), 6. doi: 10.1016/s1351-4210(14)70179-9

P, K. (2013). Pest Problems of Oil Palm and Management Strategies for

Smit, H., Meijaard, E., van der Laan, C., Mantel, S., Budiman, A., & Verweij, P. (2013).
Breaking the Link between Environmental Degradation and Oil Palm Expansion: A
Method for Enabling Sustainable Oil Palm Expansion. Plos ONE, 8(9), e68610. doi:
10.1371/journal.pone.0068610

Subramaniam, V. (2016). QUANTIFICATION OF GREENHOUSE GAS EMISSIONS FOR