The oil palm sector is the largest agricultural export earner for Indonesia, with exports worth 15 billion dollars in 2010. Government and industry are planning to more than triple the area of oil palm plantations in the coming decade from the current 7 million hectares to more than 25 million hectares. While bringing income and jobs to rural poor, the industry has taken over the lands of millions of small farmers and damaged the forests and traditional livelihoods of thousands of indigenous communities.

The Indonesian Constitution recognizes the rights of indigenous communities to their customary lands, livelihoods, and systems of law and government, but in practice these rights have been routinely ignored and violated by government and industry. The right of indigenous peoples to control developments on their customary lands was confirmed in 2007 by the United Nations Declaration on the Rights of Indigenous Peoples, and today governments and businesses around the world are being challenged to fulfil this commitment. International voluntary standards for forestry, oil palm, and for reducing emissions from deforestation require developers to respect the rights of indigenous peoples and local communities to give or withhold their free, prior, and informed consent (FPIC) to developments that may affect their customary lands.

The Indonesian Government and the national association of oil palm companies are resisting demands that they respect the rights of indigenous peoples and local communities when they develop new plantation areas. Human rights groups in Indonesia and abroad are forming alliances with small farmers to encourage progressive producer and consumer companies to respect the rights of indigenous and local communities to FPIC.

Many of the largest oil palm plantation companies operating in Indonesia have joined the voluntary industry standard, the Round Table on Sustainable Palm Oil, and are now obliged to respect indigenous peoples' customary land rights. Some of these plantation companies have begun to change the way they acquire plantation land accordingly. If fully implemented, these commitments should reduce forest loss and bring positive benefits to millions of small farmers who are members of indigenous peoples and local communities in Indonesia.