Firstly, the new Gabonese operations of agricultural trading company Olam International was heavily criticised by US environmental NGO Mighty Earth in December. Then Dimensional Fund Advisors, a big US investment firm that had previously been criticised for continuing to invest in palm oil companies, decided to divest two of its portfolios of all such assets, including equity in Wilmar International and Olam.
The campaign against palm oil could have profound implications for the sector’s development in Africa. Palm oil cultivation has become controversial because ecologically diverse areas of rainforest are often cut down to allow cultivation to take place. Huge areas of forest have been felled in Indonesia and Malaysia, affecting flora and fauna, and producing air pollution caused by forest fires when land is being cleared for palm oil plantation.
According to Friends of the Earth and numerous other environmental NGOs, palm oil plantations are the fastest growing cause of rainforest destruction and an increasingly important cause of climate change.