The Oil Palm The Oil Palm

Branson Weighs in on Palm…and Fails

Richard Branson is a smart and successful businessman.

Part of his success has relied on brash, big initiatives. He is opportunistic when he needs to be. And simplifies things to hit the broadest market (otherwise known as the lowest common denominator).

Which is precisely why he shouldn’t talk about palm oil.

Sir Richard has taken to the Virgin Group’s website to lament forest loss and orang-utan loss in the Leuser Ecosystem in Sumatra, Indonesia.

He’s lined up with Friends of the Earth and the Rainforest Foundation of Norway – a group funded by fossil fuel interests – to attack small farmers in the developing world.  How neocolonial of him.

While there is no question that the Leuser Ecosystem is worth conserving – Sir Richard points the finger solely at palm oil. And he then suggests that solutions such as RSPO certification and Unilever’s procurement policies are a kind of magic bullet.

To the uber-wealthy CEO of a large, Western company, the problem and the solution seem simple. That’s because he doesn’t understand what he doesn’t know. To anyone who actually has to deal with the problems, the political and economic realities are much more complicated.

Why is Sir Richard so wrong?

First, protecting natural environments requires money because, let’s face it, the private sector doesn’t establish national parks.

This means resources need to go into proper demarcation and surveys, enforcement and compliance. And on top of that, people either need land to grow crops, or they need jobs to support themselves.

Second, the problems of environmental degradation in developing countries aren’t that simple, and they don’t just belong to palm oil. Encroachment in national parks and sensitive ecosystems happens because people are poor. These people will cut down trees and grow crops. If a large company takes a responsible view and doesn’t cut where it isn’t supposed to and certifies according to RSPO (or other) standards, it doesn’t actually stop the encroachment in the national park.

If palm oil was banned everywhere tomorrow, would this stop deforestation? No, because people would grow something else.

Third, as we’ve stated many times before, a procurement policy such as Unilever’s cuts smallholders out of supply chains. This can actually have a perverse effect. If smallholders are cut from these supply chains, they may actually need to cut down more forest to make up for a revenue shortfall as they have one less buyer in the marketplace. Disenfranchising poor people in this way is therefore undesirable practically – but also ethically. Western billionaire attacks poor Asian small farmers: not a good look.

Fourth, and finally, if the Leuser Ecosystem is having problems with deforestation, it simply does not follow that all palm oil is bad.

So why has Branson jumped on the palm oil bandwagon?

There are possibly a few reasons.

First, there is history of this type of elitist thinking emanating from London; look no further than Prince Charles’ environmental crusades globally.  It’s driven by an ideology of ‘we know what’s best for you’.  A good history lesson, starting with the American Revolution, provides some answers on how to respond.

Second, the EU looks set to push back on its renewable fuel mandate in some way, shape or form. Environmental groups have generally been supportive of some sort of curb, particularly on palm oil, if not the entire biofuels sector. Branson made a significant pledge to biofuel development more than a decade ago (see below). Branson has in the past associated himself with groups such as Greenpeace and WWF.  Virgin’s airlines need to be seen on the fashionable side of the European debate here.

Third, Branson’s environmental record is actually patchy. Although Branson has been a champion of biofuels and was more than happy to get on the Copenhagen train in 2009, the actual commitments of Branson and Virgin have been quite slim. Here are some examples.

  • In 2006, Branson pledged $3bn in biofuels development as a way of curbing oil and gas demand. That number ended up being around 3 per cent of that total;
  • A few years later, he launched the Virgin Earth Challenge, a $25 million prize to come up with commercially viable ways to sequester carbon. As far as we can tell that prize was never awarded.
  • Around the time of Copenhagen climate conference he launched – with much fanfare, of course, the Carbon War Room. This was simply more efficient business processes (e.g. minimising energy use). This is no longer in existence.

But ultimately what needs to be remembered is that the bulk of Branson’s business fortune has been built on the burning of fossil fuels. Without fossil fuels there would simply be no aviation.

Truth hurts.

Apparently, Branson doesn’t see any sort of inconsistency in his environmental arguments.

But somehow he thinks he has the grounds to criticise any number of small farmers simply trying to go beyond subsistence living.

Like Sir Richard, some of them might have houses on islands, but they don’t actually own the island.

If Branson is keen to help the world – as he often seems to be – perhaps he should begin to realise that not all problems can be simplified down to a slogan, a campaign or a brash marketing stunt.

Some problems are complicated, and they require nuanced, subtle solutions.

But Sir Richard and ‘subtle’ have never gone together.