This aligns with RSPO’s long-term outcome (ToC L1) whereby we envision that palm oil producers of all sizes (smallholders, medium and large growers) derive value and utility from complying with RSPO Standards, systems and procedures.
Smallholder farmers are the backbone of global palm oil production. Across a number of countries in the producing regions of Southeast Asia, Africa, and Latin America, millions of smallholders collectively account for approximately 30% of the world’s palm oil production area1.
RSPO recognises two principal types of smallholders: scheme smallholders, who are formally linked to a mill or plantation company through an outgrower arrangement; and independent smallholders, who operate without such institutional ties. For a full overview, visit the RSPO Smallholder Hub.
For many rural families across producing regions, income from oil palm is a critical pathway out of poverty. Yet where smallholders are excluded from sustainability systems, the risks are real: encroachment on forests and peatlands, weaker rights protections, and supply chains that cannot credibly demonstrate sustainability at every level. Conversely, when smallholders are empowered, the benefits flow across the entire value chain: stronger environmental outcomes, more resilient communities, and more credible sustainability claims for brands and buyers. Smallholder inclusion is therefore not a supplementary concern for RSPO, but it is a strategic and key imperative.
A growing regulatory environment reinforces this. The EU Deforestation Regulation (EUDR), EU Corporate Sustainability Due Diligence Directive (CSDDD), UK Environment Act, and the UN Guiding Principles on Business and Human Rights collectively place explicit expectations on companies to take active responsibility for the welfare and practices of smallholders within their supply base. Smallholder inclusion is not only the right thing to do, but a legal and commercial necessity for market access, investor confidence, and reputational credibility.