- Nestle didn’t ‘cut ties’ with Indonesian planter Astra Agro
- The cited cases are complex and involve multiple claims across decades
- Western NGOs as usual are seeking media victories without helping communities
Last week both Bloomberg and Reuters ran stories claiming that Nestle had ‘cut ties’ with Astra Agro Lestari (also known as AAL), an Indonesian conglomerate with plantations and processing operations based in Indonesia.
The story cited a letter sent from Nestle to Western NGO Friends of the Earth (FOE), stating this was the case.
But what is actually happening?
First, Nestle didn’t ‘cut ties’ with AAL. A deeper dive indicates that AAL wasn’t even a direct supplier to Nestle. Rather, three AAL subsidiaries were on Nestle supplier lists through other processing and trading operations.
In total, AAL has 41 subsidiaries in Indonesia, and around 310,000 ha of plantations. At best, these three subsidiaries – if they are on the larger side – might represent around 10 per cent of AAL’s total plantation operations. This can hardly be considered ‘cutting ties’ – particularly if those ties weren’t even there to start with.
Second, FOE has been making claims against AAL – but like most Western NGOs, they’re happy to jump on an ambiguous legal situation to further their own cause.
One of the land disputes that FOE cites is that of PT Mamuang and local Kabuyu residents in Sulawesi. A quick look at Indonesian court records indicates that this is not a matter of new ‘land grabbing’ by a palm oil company, but an ambiguity around titling that goes back to 2003.
Friends of the Earth has published a glossy report – in English – on cases including this one. But rather than citing the legal record of events and the ambiguity of the land claims between communities and companies, FOE’s account is just one-sided.
This is precisely why when AAL responded publicly to the Bloomberg report they stated this is an “old issue” that has “been clarified”. In this case it had been clarified by the Indonesian court system.
Astute observers of Indonesia know that these issues are notoriously complex, often involve multiple actors and overlapping claims between communities. This is why the World Bank has spent literally decades supporting land titling reforms in Indonesia.
Further, land claims aren’t exclusive to Indonesia, which was left with the additional burden of a chaotic, illogical titling system by Western Dutch colonialism. Disputes can be as common in Western democracies as they are in countries like Indonesia; will FOE ever lobby General Mills over land disputes in the Midwest?
Third, there has been a consistent campaign against AAL for some time now by multiple NGOs. One of the reasons for this is that the company is not a member of RSPO. It has, instead, pursued and maintained ISPO certification, implemented a no deforestation policy and has unilaterally undertaken High Conservation Value (HCV) and High Carbon Stock (HCS) assessments for new plantings.
In other words, it is an example of how a sustainability policy can work without bowing to Western green demands.
The real underlying problem is that Western NGOs continue to oversimplify complex Indonesian issues in order to gain quick headlines and media victories that do precisely nothing for palm oil communities on the ground.
These NGOs seem to be oriented more towards gaining funding from wealthy US donors than actually making a difference.
There’s also a congratulatory tone in the Western NGO statements around a purchaser ‘cutting off’ farmers. This is tone-deaf to the power imbalance in the situation: The world’s largest consumer goods company cuts off suppliers, including small farmers, in a developing country because Western activists badgered them. That’s as rich as the faux chocolate and butter in Nestle’s Butterfinger. This isn’t something worth celebrating.