Oil Palm Industry Economic Journal Vol. 20 (2) September 2020 p. 22-28

Understanding the Features and Roles of the Board of Directors of Sustainable Oil Palm Growers Cooperatives in Sabah

Zaki Aman*; Abdul Rahman Abdul Rahim**; Humaira Mat Taib*; Nazirah Che Jaafar*; and Amran Ariffin*
Received: 30 August 2019   Accepted: 18 June 2020   Available Online: 29 September 2020


Sustainable Oil Palm Growers Cooperatives or known in Malay as ’Koperasi Penanam Sawit Mampan‘ (KPSM) is an instrument to increase the income of oil palm smallholders and create employment opportunities in Malaysia. KPSM members and Board of Directors (BOD) consist of oil palm planters themselves. This study aims to investigate KPSM board members’ characteristics and their understanding of their roles in operating the KPSM. Data were collected from 104 KPSM board members in Sabah. The quantitative research approach was used and mean values were obtained for data analysis. The majority of the respondents were found to be male with an average age of 53 years and a moderate education level. The respondents were found to be aware of their roles in communicating with other board members, carrying out the cooperatives’ policies, monitoring the internal control system, and complying with cooperative regulations. Most of the items that measured the roles of the BOD scored above 4.0 based on a five-point Likert scale, indicating good to excellent understanding. However, the respondents’ understanding of the KPSM reports was moderate with a mean value of 3.98, which was mainly due to the respondents’ moderate education level. This study also found that the majority of the respondents spent 2.2 days per month on average at their respective KPSM. KPSM needs competent management to serve the members’ requirements and KPSM board members need to have the appropriate knowledge to conceive new ideas for their respective cooperative. This study suggests that further research should be done to investigate why the younger generation is not interested in agriculture cooperatives and to determine other factors that influence the performance of agriculture cooperatives.

Keywords: oil palm smallholders, Board of Directors, cooperative, KPSM, smallholder demographic profiles.

About Post Author

* Malaysian Palm Oil Board,
6, Persiaran Institusi,
Bandar Baru Bangi,
43000 Kajang, Selangor, Malaysia.
E-mail: zaki@mpob.gov.my

** AAGBS, Universiti Teknologi MARA,
40450 Shah Alam,
Selangor, Malaysia.