Malaysia’s Palm Oil Private Sector Determined to Show Leadership


Recently, the Malaysian Palm Oil Association (MPOA) announced a Responsible Employment Charter to address concerns around labor rights in the palm oil supply chain.

The MPOA Responsible Employment Charter commits to:

  • Prohibition on recruitment fees charged to jobseekers
  • No retention of workers’ passports or similar restrictions on freedom of movement
  • Actively supporting workers joining trade unions and other worker organisations
  • Publicly-available Corrective Action Plans (CAPs) as a means to address any future labour violations

The Charter is the most recent of a series of commitments and action plans implemented by private sector growers and palm oil companies across Malaysia. It sends a clear message to customers, governments and stakeholders around the world that the private sector of the Malaysian palm oil industry understands the concerns, and is committed to rectifying problems that do exist.

One of the most pressing questions for larger companies has been the unethical recruitment and treatment of workers within their supplier networks. It has for several years been difficult for Malaysian companies to have full visibility on workers throughout the sometimes hundreds of companies that they source from. This is a natural difficulty with such a complex and geographically-spread supply chain.

With that said, customers and trading partners – such as U.S. Customs & Border Protection Agency (CBP) – have made clear that governments and companies must take responsibility throughout the entire supply chain.

Last week, we were reminded that the Malaysian business community still has work to do.

The U.S. CBP issued a Withhold Release Order against Malaysian disposable glove maker Brightway Holdings indicating they found forced labor in the company’s operations in violation of ILO principles.

In the wake of this action, it has been reported that some of Brightway’s most significant customers have halted orders with the company. Contracts with the multinational giant Kimberly Clark, and Ansell – a major supplier to the UK’s National Health Service – are reportedly among those at risk.

These developments – happening so quickly after the move by the CBP – illustrate both the global reach and power of those looking to stamp out forced labor practices, and the interconnectedness of global supply chains.

This is an opportunity for the palm oil sector to show leadership – and communicate that change is underway.  

Regardless of other efforts that may or may not be undertaken in Malaysia, the private sector palm oil companies are pushing ahead. Individual companies, as well as supporting the Charter, are pursuing their own reforms and steps forward.

Sime Darby

In 2018, Sime Darby Plantation (SDP) established the Suara Kami helpline with its partner ELEVATE in collaboration with Nestle. 

The multilingual toll-free channel provides a platform for workers to anonymously raise any issues or grievances via call, text and Facebook Messenger. It is available in 7 different native languages of the company’s workers (English, Bahasa Indonesia, Bahasa Malaysia, Bengali, Nepali, Tamil and Hindi). SDP has also brought on board for advice the migrant rights activist, Andy Hall.


A comparable example of leadership is the role of Wilmar between 2014 and 2017. Wilmar launched their NDPE policy in 2013 which also applies to all suppliers in their supply chain.

Since 2014, assessments on mill suppliers for compliance to the policy, including on human and labor rights, have been carried out annually. Wilmar works with independent organizations to support their NDPE policy implementation. Underpinning all of the supplier work is the publicly available grievance procedure launched in 2015, and the 2019 No Exploitation Protocol which includes required specific measures to address human rights related non-compliance.

Looking Ahead

As we look ahead, the private sector is therefore best placed – and in many cases expected – to take the lead in ensuring that labor issues in the supply chains are understood, investigated and addressed. Malaysian companies and associations are now adopting that leadership role, and starting to communicate to key global stakeholders.

If we are to make the big leap we know is possible, it will be important for all parties to publicly support these efforts, and make proactive measures, such as MPOA’s Responsible Employment Charter, a success.