ISPO and RSPO: what certification means for a plantation

Indonesia’s own certification, Indonesian Sustainable Palm Oil (ISPO), is a legal duty for every oil palm plantation company and, from March 2029, for smallholders too. The Roundtable on Sustainable Palm Oil (RSPO) is a voluntary international scheme that some buyers and lenders ask for.

For an investor, the certificate matters less than what the audits looked at. A certificate that’s missing or has lapsed often points to a problem with the land or the licences.

ISPO, the mandatory scheme

ISPO now rests on Presidential Regulation 16 of 2025, issued on 19 March 2025, which replaced Presidential Regulation 44 of 2020. It covers oil palm growing, milling and estates that do both. Plantation companies have been bound since the day it took effect. Smallholders are bound from 19 March 2029, and refiners, other downstream processors and palm-based bioenergy producers from 19 March 2027.

Smallholders may certify in groups or through cooperatives, and public money can pay for it, from the cultivation registration letter (STDB) to the audit itself.

Certificates are issued by independent certification bodies accredited by the National Accreditation Committee (Komite Akreditasi Nasional, KAN). A certificate runs for five years, and the holder must apply for recertification at least a year before it expires. A company that fails to certify faces a written warning, an administrative fine or a temporary suspension of its business.

RSPO, the voluntary scheme

RSPO is an international membership body of growers, traders, manufacturers, retailers, banks and civil-society groups. Growers are certified against its Principles and Criteria. The current version was adopted on 13 November 2024 and took effect on 1 June 2026, with a national interpretation for Indonesia.

In places RSPO asks for more than Indonesian law. Before any new planting, a grower needs an assessment of high conservation value and high carbon stock areas, and the free, prior and informed consent of affected communities. The plan is then posted for 30 days of public comment. Land cleared without the required assessments has to go through a remediation and compensation procedure.

An RSPO certificate also runs for five years, with a surveillance audit every year, and it’s valid only while the holder’s trading licence is active. Certified oil reaches buyers through four supply chain models: identity preserved, segregated, mass balance, and book and claim, where buyers purchase credits from certified growers and smallholders.

What the auditors check

ISPO’s seven principles for companies cover legal compliance, good plantation practice, the environment and biodiversity, workers, communities, transparency and continuous improvement. Under the ministry’s rules, smallholders are audited against five, without the principles on workers and communities.

For a buyer, the first principle matters most. Its criteria are the legality of the land and the legality of the plantation business. A company can’t even apply without its plantation business licence, proof of its land rights and its environmental approval, so an estate with planted blocks outside its title or inside a forest area struggles to certify at all. The article on plantation permits and HGU covers those documents.

RSPO audits cover similar ground, with more weight on conservation areas, community consent and labour rights.

Time and cost

The detailed ISPO procedure is in Agriculture Minister Regulation 38 of 2020, which stays in force where it doesn’t conflict with the 2025 regulation. The first-stage audit must take place within three months of signing the certification agreement. It reviews the legal documents and picks the estates and mills to visit, the critical points (such as protected areas, hazardous waste stores and steep slopes) and the people to interview. The second stage tests the principles in the field and with those people. Gaps found at either stage can take up to six months to close, and the certification body decides within a month of a complete audit. The audit itself takes at least 13 auditor days for an estate and 18 for an estate with one mill.

The company pays the audit fees, which grow with the number of estates and mills and with the risk of the sites. Estates on peat, on hills or under replanting count as higher risk, so more of them are sampled. The larger cost is often closing the gaps an audit finds: a missing title, blocks in a forest area, an environmental approval that no longer matches the estate or unmet duties to smallholders. Some of those take years to fix, and some can’t be fixed.

What it means for buyers and lenders

ISPO is the baseline. The certificate records the certified unit’s location and coordinates, area, productivity, total production and supply chain model. Segregated supply under ISPO means 100% certified fruit, while mass balance starts at 30% certified fruit and has to rise each year. From March 2027, refiners and biodiesel producers need ISPO themselves, and their applications must include an ISPO certificate for the plantation business, so an uncertified estate may find fewer buyers.

RSPO counts more with buyers that sell to Europe and with international consumer brands. Not every certified tonne finds a buyer willing to pay for the certification, though. Neither certificate replaces the due diligence that the EU deforestation rules ask of a buyer, but both help as evidence. Lenders with palm oil policies often ask for certification, and many international ones want RSPO membership or a time-bound plan to certify.

What a lapsed certificate tells you

Under the ISPO rules, the first surveillance audit comes between nine and 12 months after certification, and later ones at least once a year. A nonconformity found in surveillance must be fixed within three months. The certification body can then keep, suspend, cancel or revoke the certificate, and a suspended holder gets up to six months to fix the problem before it’s revoked or cancelled.

So a lapsed or suspended certificate means the holder didn’t renew in time, couldn’t fix a nonconformity or changed in a way the certificate no longer covers. Before you sign:

• Get the certificate, the latest audit and surveillance reports and the list of nonconformities, with how each was closed.
• Confirm the status with the certification body that issued it, which publishes its decisions on its website.
• Compare the certified area, coordinates, productivity and production on the certificate with the estate you’re buying.
• For RSPO, check the membership, the certificate, the licence status and any complaint against the company.
• Check whether the estate’s plasma and smallholder suppliers hold the STDB and can certify by March 2029.