Green Business and Sustainable Palm Oil: Integrating Environmental Management, Circular Economy, and Community Empowerment

Abstract

Palm oil firms are increasingly expected to demonstrate environmental and social performance to investors, buyers, and regulators, yet the three principal instruments through which they respond, environmental management systems, circular economy initiatives, and community empowerment programmes, are typically administered by separate functions and reported separately. This paper examines whether and how these three domains can be integrated into a coherent green business model for the palm oil sector. An integrative literature review was conducted on peer-reviewed studies indexed in Scopus and SINTA published between 2015 and 2025, covering environmental management and firm performance, circular economy in agro-industry, corporate social responsibility, and sustainability disclosure. Studies were coded for the domain addressed, the performance outcome examined, and the mechanism proposed, and were then synthesised into a three-pillar model with explicit linkages. The review finds that the three domains share a common resource logic but are undermined in practice by three specific misalignments: environmental management is often treated as compliance rather than capability, circular initiatives are evaluated on cost avoidance rather than value creation, and community programmes are structured as expenditure rather than as supply chain investment. The paper argues that integration is achieved not by merging these functions administratively but by aligning their measurement systems, and proposes a linked indicator architecture in which each pillar reports outcomes that the other pillars require. It further notes that empirical evidence on the financial return to green investment in this sector remains mixed, which strengthens rather than weakens the case for integrated measurement.