Algal oil is a potential substitute. There was a laundry detergent manufactured from algal oil instead of palm oil however there was pushback from consumers because the algae were genetically modified.

https://www.theguardian.com/sustainable-business/2017/sep/29...

Scaling algal oil production is a problem that is currently being worked on.

There probably isn't a single alternative since I think thats part of the problem here, it's a become a monoculture. Practically speaking though it can be replaced with various nut or vegetable oils, which of those are most environmentally friendly depend on the location and farming methods.

Palm oil effectively replaced partially hydrogenated oils in various junk foods when we learned how unhealthy trans fats were. Fully hydrogenating these oils will not have exactly the same properties as partial hydrogenation, but for many purposes it will work ok in many of these junk food applications. Fully hydrogenated oils don't have the trans fat issue, but it will require consumer education to make this point clear.