Kao, Apical and Asian Agri Launch Palm Oil Program: SMILE

Kao, Apical and Asian Agri Launch 'SMILE' Program to help oil palm smallholders improve yields, acquire certifications, and secure premiums.
Kao, Apical and Asian Agri Launch 'SMILE' Program to help oil palm smallholders improve yields, acquire certifications, and secure premiums.

Kao Corporation, Apical Group and Asian Agri have announced a new sustainability initiative to help independent palm oil  smallholders in Indonesia, called Smallholder Inclusion for better Livelihood & Empowerment (SMILE).

Related: Kao Launches Unsecured Straight Bonds

SMILE, an 11-year initiative, aims to improve the smallholders' yields, acquire international certification and eventually secure sales premiums from selling certified palm oil. 

To do so, SMILE will assemble a team of experts to work with 5,000 independent smallholders that manage approximately 18,000 ha of plantations in the provinces of North Sumatra, Riau and Jambi. Through customized seminars and workshops, the team will:

  •  Educate farmers on how to improve their yields and sustainably manage their farms, as well as on the importance of staying committed to sustainable practices such as no-deforestation and zero-burning, no exploitation.
  • Provide support for RSPO certification.
  • Provide training on how to implement robust safety measures across their estates and safety equipment (including safety helmets, gloves and fire extinguishers).

The upscaling and provision of equipment will be implemented from 2020-2030 with a potential of helping independent smallholders secure RSPO certifications by 2030. Once certified, these smallholders will be eligible to receive certified palm oil premiums averaging 5% higher than non-certified palm oil.

Kao Corporation, Apical Group and Asian Agri are implementing activities in accordance with the framework provided by RSPO and are working to ensure traceability as far as the oil palm plantation in order to build an environmentally-friendly, socially-aware supply chain.

As part of RSPO requirements as well as the companies' commitment to help the community collectively realize the UN Sustainable Development Goals (SDGs), SMILE includes initiatives that promote greater inclusion and improved livelihoods via empowerment initiatives for communities.

Global production of palm oil stands at 75 million tons per year and is expected to reach 111.3 million tons by 2025. There is now a greater focus in Indonesia on improving palm oil productivity while minimizing the need for the extention of existing agricultural land. This not only helps to safeguard food security, but serves to balance social, environmental and economic needs.

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