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Independent Smallholders Behaviour towards Complying
with Malaysian Sustainable Palm Oil (MSPO) Certification
Norhana Abdul Majid, Zaimah Ramli, Abd Hair Awang, Sarmila Md, Sum
To Link this Article: http://dx.doi.org/10.6007/IJARBSS/v13-i2/16222 DOI:10.6007/IJARBSS/v13-i2/16222
Received: 08 December 2022, Revised: 11 January 2023, Accepted: 29 January 2023
Published Online: 10 February 2023
In-Text Citation: (Majid et al., 2023)
To Cite this Article: Majid, N. A., Ramli, Z., Awang, A. H., & Sum, S. M. (2023). Independent Smallholders
Behaviour towards Complying with Malaysian Sustainable Palm Oil (MSPO) Certification. International
Journal of Academic Research in Business and Social Sciences, 13(2), 634 – 643.
Copyright: © 2023 The Author(s)
Published by Human Resource Management Academic Research Society (www.hrmars.com)
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Vol. 13, No. 2, 2023, Pg. 634 – 643
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Vol. 13, No. 2, 2023, E-ISSN: 2222-6990 © 2023 HRMARS
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Independent Smallholders Behaviour towards
Complying with Malaysian Sustainable Palm Oil
(MSPO) Certification
Norhana Abdul Majid, Zaimah Ramli, Abd Hair Awang, Sarmila
Md, Sum
Centre of Development, Social & Environmental (SEEDS), Faculty of Social Science and
Humanities, Universiti Kebangsaan Malaysia, 43600 Bangi, Selangor, Malaysia.
Email: p100988@siswa.ukm.edu.my, zaimahr@ukm.edu.my, awangabdhair@gmail.com,
sarmila.mdsum@ukm.edu.my
Abstract
The mandatory implementation of Malaysian Sustainable Palm Oil (MSPO) requires the
participation of all oil palm producers including the smallholders. The implementation of
MSPO serves as one of the avenues to address the sustainability issues related to the
development of the palm oil industry. The purpose of this study is to examine factors that
influence the smallholders’ behaviour in complying with the mandatory MSPO
implementation. A questionnaire was employed to measure the smallholders’ behaviours.
The respondents were 404 oil palm independent smallholders in the state of Johor Darul
Takzim. Correlation analysis was performed to test the relationship between variables. Using
Theory of Planned Behaviour as the basic theory for the study, the findings revealed that
attitude, subjective norms, perceived control behaviour and intention have a significant and
positive relationship with MSPO compliance behaviour. Based on the study, there is a need
to improve the smallholders’ attitude and perceived behavioural control to sustain
smallholders’ behaviours to comply with the MSPO requirements.
Keywords: Smallholder, Behaviour, Attitude, Intention, MSPO.
Introduction
The oil palm industry has been one of the important economic pillars for the development of
Malaysian economy. The palm oil industry generated total export revenue of RM18.52 billion
in 2021 (MPOB, 2021). The development and expansion of the oil palm sector are not without
its challenges. Issues related to environment including deforestation, sustainability
production and climate change continues to be associated with the palm oil industry. In
addition, the negative campaign by the Non-Governmental Organisation (NGO) influences the
consumer perception on the image of oil palm. The establishment of the Roundtable on
Sustainable Palm Oil (RSPO) in 2004 was a turning point for the palm oil industry in the fight
against the negative allegations and a pledge of commitment toward sustainable palm oil
production. The RSPO was founded with the objective of promoting the growth and usage of
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sustainable palm oil products through credible international standards (RSPO, 2023).
Sustainability certification scheme has been selected as one of the solutions to monitor and
improve sustainable production among the country's oil palm growers and producers. The
MSPO Certification Scheme is the national scheme in Malaysia for oil palm plantations,
independent and organised smallholdings, and palm oil processing facilities to be certified
against the requirements of the MSPO Standards (Kumaran, 2019). Europe continues to be a
big market for certified palm oil and the demand from China and India is also growing (Vasu
& Poo, 2022) The pledge by the European Union to phase out the use of palm oil in transport
fuel by 2030 (Dusser, 2019) and the proposed EU deforestation-free products regulation
(Vasu, 2022) would provide a serious threat to the palm oil exports.
Smallholders is an important producer in the integrated system of the palm oil supply chain
in addressing issues of sustainability and improvement in productivity (Cahyadi et al., 2021).
The low involvement of independent smallholders in sustainability certification has been
hindered by issues of lack of fund, lack of management skills and record keeping, and
knowledge (Brandi et al., 2015; Rietberg, 2016). In addition, smallholders’ participation in
sustainability certification requires their commitment and understanding the certification
requirement. Smallholders’ participation in implementing sustainability certification is
important as the demand for sustainable palm oil continue to increase. The Malaysian
government has provided financial incentives and training to create awareness and
participation of the independent smallholders to participate in MSPO (Kannan et al., 2021)
The implementation of MSPO was made mandatory in order to expediate the implementation
and participation of the oil palm growers. However, this effort was not enough to push the
independent smallholders to obtain the MSPO certification. In 2020, only 31.61% or about
311,739.51 hectares out of 986,331 hectares of the independent smallholders’ plantation
have obtained the MSPO certification (MPOCC, 2020). The objectives of the study
a) To examine the factors that affect the smallholders behaviour in complying with the
mandatory implementation of MSPO; and
b) To assess the relationship between attitude, subjective norms and perceived
behavioral control with smallholders’ behaviour in complying with the mandatory
implementation of MSPO.
Literature Review
Malaysian Sustainable Palm Oil
The implementation of MSPO certification is to ensure oil palm plantations, independent and
organised smallholders as well as processing facilities to adopt sustainable production. The
mandatory implementation of MSPO from January 2020 is to ensure that the entire palm oil
planted area and procession facilities are certified. In addition, it is also a strategic move to
enhance competitiveness and strengthen the image of the palm oil industry. Sustainable
certification requires the oil palm growers including smallholders dan palm oil manufacturers
to adhere to the principles and criteria in the certification scheme. The number of principles
and criteria for a certification scheme varies depending on the elements that form the basis
of the certification. MSPO for independent palm oil smallholders has a total of 7 main
principles and 33 indicators (Senawi et al., 2019). The certification process of MSPO requires
auditing by third part independent Certification Bodies (Kumaran, 2019). The participant will
be issued the MSPO certification after fulfilling the auditing requirement. The implementation
of the MSPO is gazetted under the Malaysian Palm Oil Board Licensing Regulations. Any non-
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compliance with this regulation will result in the smallholders being compounded and their
activity licenses to be suspended, revoked, and not renewed.
Theory of Planned Behaviour
TPB was developed by Ajzen (1991) to predict and explain individual’s intention to undertake
a particular behaviour. According to TPB, individual behavioral intention and actual behavior
influenced by three main factors which are attitude, subjective norms and perceived
behavioural control.
Attitude
Attitude is one of the variables that affect the formation of an intention where the attitude
will guide the individual to perform a certain behaviour and based on the belief or evaluation
of whether the behaviour will bring positive or negative effects. Individuals are more likely to
engage in behaviours that are perceived to have good outcomes for them, and less likely to
engage in activities associated with negative outcomes. The Theory of Planned Behaviour
assumes that individual attitudes are the main predictors of individual intentions to engage
in behaviour (Ajzen, 1991; Fishbein, 2008). The smallholders’ attitude towards MSPO would
increase if they viewed the certification would bring a positive impact toward improving the
fresh fruit bunches productivity and their livelihood. Likewise, if the smallholders who believe
that there is no impact from participating in certification, the tendency to participate in the
certification scheme is decreasing. Study has indicated that positive attitude has increase the
smallholders’ intention in engaging sustainability practices (Terano et al., 2015; Zeweld et al.,
2017). In the same context, study by Cahyadi et al (2021) found that oil palm smallholders in
Riau, Indonesia showed positive attitude towards sustainability and indicated their interested
in taking steps to practice sustainability activities in their oil palm cultivation.
Subjective Norms
Subjective norms refer to perceived expectation from others that influence an individual to
perform a particular behaviour (Ajzen, 1991) . Reference individuals or important people who
are often identified include spouses, family members, close friends and depending on the
behavior being studied. Subjective norms consisting of normative belief that an important
person will approve and support certain behaviour. Cahyadi et al (2021) found that the
influence of extension officers on smallholders to practice sustainability activities was low
because the smallholders involved in the study had never been involved in the development
program from any party. However, respondents have a high desire to do what people around
them such as other smallholders and oil palm plantation companies are doing if it is proven
that sustainable practices increase their palm oil productivity. Several studies have found that
subjective norms affect behavioral intention which lead to behaviour to adopt sustainability
practises (Huat et al., 2017; Yutika et al., 2019).
Perceived Behavioural Control
Perception of Behavioral Control refers to the perceived ease or difficulty involved in
performing a behavior (Ajzen, 1991). Behavior control perceptions are also considered to
influence behavior directly and through behavioral intentions. In reality, the extent to which
the behavior is performed depends on how easy or difficult the individual sees the behavior
and this perception has an effect on the individual's intention to engage in the behavior. This
refers to the amount of control that a person identifies he may have to participate in a
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particular behavior (Ajzen, 1991). Knowledge in oil palm cultivation is important to implement
good agricultural practices and increase oil palm productivity . The MSPO principle and
criteria requires smallholders to follow good agricultural practices that cover various aspects
of oil palm cultivation. Lack of skills and knowledge in good agricultural practices will affect
oil palm productivity and engage in unsustainable practices. Studies have shown that
perceived control behaviour have had a significant impact on smallholders’ behaviour.
Hypothesis
There are four hypotheses for this study as follows:
H1: There is a positive relationship between attitude and MSPO Compliance.
H2: There is a positive relationship between subjective norms and MSPO Compliance.
H3: There is a positive relationship between perceived control behaviour and MSPO
Compliance.
H4: There is a positive relationship between intention and MSPO Compliance.
Methodology
This respondents of this study were independent oil palm smallholders in the state of Johor
which has the largest independent smallholders in Malaysia. The data was collected in
February to April 2022 with the assistance of TUNAS officers from the Malaysian Palm Oil
Board (MPOB). Primary data were obtained using questionnaires with 404 respondents.The
analysis for this study involved descriptive and inferential statistics utilising the Statistical
Package for Social Sciences (SPSS) software.
Result and Discussion
Demographic Analysis
Table 1 above shows the profile of the independent smallholders participating in this study.
The respondents consist of 74.5% male respondents and 25.5% female respondents. Majority
of the respondents were in the age group of 61 years and above, followed by 24.8% of
respondents aged between 51 to 60 years old. 76 respondents or 18.8% are between 41 to
50 years old and 11.9% of respondents were between 31 to 40 years old. The remaining 4%
of respondent aged between 20 to 30 years old. This shows that majority of the independent
of smallholders are aging and this posed a challenge for the independent smallholders to
implement and sustain the implementation of MSPO in the long run. Education level for most
of the independent smallholders were at secondary school level at 56.7% followed by diploma
level at 12.6%. and primary school at 11.9%. The remaining 7.6% of respondents have an
undergraduate degree, while 3.7% respondents have obtained skill certification. 23
respondents or 5.7% respondents have received no formal education.
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Table 1
Background profile of respondent
Frequency
Percentage
Gender
Male
301
74.5
Female
103
25.5
Age
20 to 30 years
16
4.0
31 to 40 years
48
11.9
41 to 50 years
76
18.8
51 to 60 years
100
24.8
61 and above
164
40.6
Education Level
No formal education
23
5.7
Primary School
Secondary School
48
229
11.9
56.7
Skills Certification
15
3.7
Diploma
51
12.6
Undergraduate Degree
31
7.6
Others
7
1.8
Experience in oil palm planting
Less than 3 years
31
7.7
3 to 5 years
44
10.9
6 to 10 years
76
18.8
11 to 15 years
72
17.8
More than 15 years
181
44.8
Palm oil hectarage
Less than 2 hectare
2 to 5 hectars
More than 5 hectares
173
176
55
42.8
43.6
13.6
Majority of the independent smallholders in the study or 44.8% have been involved in oil palm
cultivation for more than 15 years. 18.8% of the respondents indicated that they have 6 to
years’ experience while 17.8% between 11 to 15 years. 75 respondents (18.6%) s have
experience less than 5 years in oil palm planting. 176 respondents (43.6%) owned oil palm
farm between 2 to 5 hectares followed by 42.8% owned less than 2 hectares of farm and the
remaining 13.6% have farm more than 5 hectares.
Descriptive Analysis of Variables
Based on Table 2, all items recorded a mean value greater than 3.5 with the overall mean at
4.2237. This can be concluded that the independent smallholders agreed with the
implementation of MSPO. Attitude recorded the highest mean at 4.4757 which shows that
the independent smallholders are positive and receptive with the government policy.
Meanwhile, perceived behavioral control mean is the lowest ar 3.9525 which indicate that
although smallholders are believed that they are able to implement the requirement of
MSPO, challenges such as availability of funds and cost of certification may become an
obstacle for fulffilling the requirement of MSPO. The high mean of 4.3148 for intention shows
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that the independent smallholders do intend to commit with the implementation of MSPO.
The guidance of the TUNAS officers in assisting the independent smallholders in preparing for
MSPO has all contribute to the high mean for subjective norms which shows the importance
of those people around the smallholders to support the implementation of MSPO. This result
showed that importance roles played by the people surrounding the independent
smallholders influencing them to implement MSPO. In this case the role of TUNAS officers of
MPOB played a significant role in providing training and technical assistance for the
smallholders in preparing them in implementing sustainable certification.
Table 2
Descriptive Analysis
N
Mean
Std. Deviation
Attitude
404
4.4757
0.49924
Subjective Norms
404
4.2559
0.48249
Perceived Behavioural Control
404
3.9525
0.54397
Intention
404
4.3148
0.48424
Behaviour
404
4.1195
0.49687
Table 3 summarizes the correlation testing for the study. The result indicated that there is a
correlation between all the variables and a change in one variable will have a positive affect
in another variable. The study shows positive and strong correlation between all the variables
and compliance behaviour with intention (0.749), subjective norms (0.607), perceived control
behaviour (0.569) and attitude (0.548). From the study, it is evident that each of the
independent variables has a definite relationship in perdicting the behaviour of the
independent smallholders’ in complying with the MSPO implementation. This finding also
supported all the hypothesis suggested.
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Table 3
Correlation Analysis
A
SN
PBC
I
B
Attitude
Pearson Correlation
1
Sig. (2-tailed)
N
404
Subjective
Norms
Pearson Correlation
.645**
1
Sig. (2-tailed)
.000
N
404
404
Perceived Control
Behaviour
Pearson Correlation
.507**
.631**
1
Sig. (2-tailed)
.000
.000
N
404
404
404
Intention
Pearson Correlation
.636**
.573**
.539**
1
Sig. (2-tailed)
.000
.000
.000
N
404
404
404
404
Behaviour
Pearson Correlation
.548**
.607**
.569**
.749**
1
Sig. (2-tailed)
.000
.000
.000
.000
N
404
404
404
404
404
**. Correlation is significant at the 0.01 level (2-tailed).
A=Attitude, SN= Subjective Norms, PBC= Perceived Control Behaviour, I= Intention,
B=Behaviour
Discussion and Conclusion
The implementation of MSPO would provide an avenue for the smallholders to improve their
agricultural practices through adoption of sustainable practices. The independent
smallholders are aware and willing to comply with the implementation of MSPO. However,
improving the smallholders attitude and perceived control behaviour would be one of the
critical steps that need to be taken into consideration for them to be more willing to
implement and participate in MSPO. Taken into account that majority of the smallholders in
this study age above 61 years, adapting to changes in sustainable agricultural practices may
poses a challenge to them. Thus it is important for the government to play an important role
in ecouraging and ensuring training for a more effective implementation. Although the
smallholders have the experience and skills to fulfill the principal and criteria of MSPO, this
would requires additional cost, time and knowledge. With the current technical and financial
support by the government, the smallholders may not feel the burden. However, in the long
for MSPO to be sustained, this need to be address to ensure that ability of smallholder to
maintain the certifcation can be sustain in the long run. The finding shows the significant role
of subjective norms particulary people surrounding the smallholders in influencing them to
comply with MSPO. In this aspect, the role undetaken by MPOB and TUNAS officers is very
significant in ensuring the smallholders compliance with the implementation of MSPO. The
findings also highlighted in importance of intention in influencing the smallholders
behaviours. Therefore, when the independent smallholders intentions to participate in MSPO
are enhanced, they would more likely to comply with MSPO requirement.
In conclusion, the study suggested that behavioral factors are significant in influencing the
smallholders behaviours to comply with the government implementation of MSPO. In order
to sustain the certification scheme in the long run, there is a need to improve the
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smallholders’ attitude and perceived behavioural control. Both of these are personal factors
and through education and training ould assist in improving the smallholders skills and
capability in complying with MSPO . This study only provide an insight of the variable that
predict the independent smallholders compliance behaviour in Johor and future studies could
be extended for samples from other states in Malaysia. In addition, similar study can be
undertaken with the organised oil palm smallholders. This would give a more comprehensive
outlook on the both independent and organised smallholders behaviour in implementing
MSPO certification.
From the theoretical perspectives, this study contribute to the body of knowledge by applying
the TPB framework in understanding smallholders’ behaviour in relation to sustainbility
production complying with the implementation of MSPO. The result of the study can be used
by policymakers to address issues on smallholders participation in MSPO. For example, MPOB
can improve its training programmes that would engage the smallholders understanding on
MSPO and hence improve their attitude in fulfilling with the MSPO requirements.
Acknowledgement
The research and publication of this article was funded by the MPOB-UKM-2020-008.
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