Chasing Sustainable Palm Oil: Consumers as a Catalyst for Change?

Kristine Vestergaard Nielsen & Mathilde Juhl Jessen

Student thesis: Master thesis

Abstract

For the past decades, sustainability has become an integral part of the global as well as many consumers’ personal agenda. As a result, companies are prone to face several risks e.g., loss of competitiveness, reputational damage, stranded assets etc., if they do not adhere to the prominent stakeholder demands for sustainability and ethical behavior. In the case of palm oil, the negative implications that persist throughout the supply chain have been granted limited publicity. Thus, there is a general lack of awareness surrounding palm oil as a commodity, despite it being present in half of the products in most Danish supermarkets. Due to a gap in consumer research concerning Danish consumers’ familiarity with the implications of the palm oil industry and perception of palm oil labeling, the purpose of the thesis is to identify the role of consumers in achieving sustainable palm oil practices in the Danish food industry. Through exploratory research, the thesis examines Danish consumers’ perception of the palm oil industry and labeling in the Danish food industry through survey research. By conducting choice experiments, consumers’ purchasing behavior and their perception of sustainability labels are explored to determine whether Danish consumers demand sustainable palm oil or palm oil-free products or potentially neither. Through four semi-structured interviews with palm oil industry actors and secondary sources, we investigate the significance of the RSPO certification scheme on palm oil production practices alongside companies’ incentives to transition to sustainable palm oil practices in the Danish food industry using Coop as an example. With 300 completed surveys, we found that the respondents were not particularly familiar with palm oil industry implications, nor did they know or consider the palm oil labels to a notable degree. The choice experiments illustrate that the RSPO label and palm oil-free label had little to no influence on consumers’ purchasing choices, and in conjunction with the views from interviewees, this signifies the ineffectiveness of the RSPO certification. We found that the Danish food industry has acknowledged the issues surrounding palm oil and therefore conducts sustainable palm oil practices on the basis of RSPO certification, yet the companies do not advocate their stance directly to consumers. We found that sustainable palm oil practices do not grant a competitive advantage but is rather seen as a license to operate. Our findings suggest that consumers are considered an important driver in companies’ incentives to conduct sustainable palm oil practices, but due to the absence of palm oil labels on packaging in the Danish food industry there is less direct pressure from the consumers. Thus, the role of consumers is rather limited, and the Danish food industry is to a larger degree pushed towards more sustainable palm oil practices by NGOs and industry actors.

EducationsMA in International Business Communication (Intercultural Marketing), (Graduate Programme) Final Thesis
LanguageEnglish
Publication date2021
Number of pages124
SupervisorsMeike Janssen