RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

RSPO PRINCIPLES & CRITERIA PUBLIC SUMMARY REPORT ANNUAL SURVEILLANCE ASSESSMENT 1

Malaysia TUAN MEE OIL MILL Kuala Lumpur-Kepong Berhad 2014

Report prepared by: Mahaswaran Maliyapan (Lead Assessor) Certification decision by: Gerben Stegeman (Certifier) Certifying Office Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100 Klang, Selangor, Malaysia [email protected] Tel: +603 -3377 16 00 / 1700

Control Union Certifications Control Union Certifications is a member of the Control Union World Group - an international inspection and certification body. CUC performs assessments and certification in many agricultural based fields such as FSC, RSPO, and Organic production, Sustainable Textile Production, Organic Exchange, GLOBALGAP, HACCP, BRC, GMP and GTP.

CUC is accredited by the Dutch Council of Accreditation (RVA) on the European quality standard EN 45011 for the inspection and certification of CUC Organic program (according to the EU regulation 2092/91) and GLOBALGAP program. When requested a copy of the accreditation certificate can be obtained from CUC.

Control Union (Malaysia) Sdn Bhd is a registered affiliate member of RSPO and is a private limited company owned by the Control Union World Group based in Malaysia. Control Union (Malaysia) Sdn Bhd is authorized to conduct and issue certification on behalf of RSPO and Control Union Certifications. RSPO Membership Number 8-0025-06-000-00 RSPO Approval Date 12/01/2006 Affiliate Membership http://www.rspo.org/en/member/339

RSPOPC-SUM-REPORT.F01 JULY2013 Page 1 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

Table of Contents PART 1: SCOPE OF THE CERTIFICATION ASSESSMENT AUDIT ...... 4

1.1 COMPANY AND CONTACT DETAILS ...... 4 1.2 RSPO MEMBERSHIP & CERTIFICATION DETAILS ...... 4 1.3 ANNUAL SURVEILLANCE ASSESSMENT DETAILS ...... 4 1.4 ASSESSMENT TYPE ...... 4 1.5 LOCATION OF THE PALM OIL MILL ...... 4 1.6 PALM OIL MILL OUTPUT AND APPROXIMATE TONNAGES CERTIFIED ...... 4 1.7 GENERAL DESCRIPTION OF SUPPLY BASE ...... 5 1.7.1 Location of the Supply Base ...... 5 1.7.2 Statistics of the Supply Base and Estimated Tonnes of FFB produced per year ...... 5 1.7.3 Conservation and HCV Area (Ha) ...... 5 1.7.4 Percentage of Planted Oil Palm by different Age Ranges ...... 5 1.7.5 Calculation of the Number of Production Units (N) to Sample for the Mill ...... 5 1.8 PROGRESS OF ASSOCIATED SMALLHOLDERS OR OUT -GROWERS , IF APPLICABLE TO THIS ASSESSMENT ...... 6 1.9 LOCATION MAP FOR THIS CERTIFICATION UNIT (S EE APPENDIX 1) ...... 6 PART 2: PARTIAL CERTIFICATION ...... 6

2.1 MANAGEMENT STRUCTURE ...... 6 2.2 NON -COMPLIANCE IDENTIFIED WITH 2.1 ABOVE ...... 6 2.3 SUMMARY OF THE TIME BOUND PLAN ...... 7 2.4 UN-CERTIFIED UNITS OR HOLDINGS ...... 8 2.5 SUMMARY OF THE FINDINGS FOR PARTIAL CERTIFICATION ...... 11 2.6 PARTIAL CERTIFICATION AUDIT AGENDA ...... 11 PART 3: AUDIT PROCESS...... 11

3.1 ABOUT THE CERTIFICATION BODY ...... 11 3.2 AUDIT TEAM ...... 11 3.2.1 Qualifications of the Lead Auditor ...... 11 3.2.2 Qualifications of the Assessment Team ...... 12 3.3 AUDIT METHODOLOGY ...... 13 3.3.1 General Overview ...... 13 3.3.2 Assessment agenda for this Audit ...... 14 PART 4 ASSESSMENT FINDINGS ...... 15

4.1 LEAD ASSESSOR ’S SUMMARY AND RECOMMENDATION FOR CERTIFICATION ...... 15 4.2 SUMMARY OF THE FINDINGS BY PRINCIPLES AND CRITERIA ...... 15 Principle 1: Commitment to Transparency ...... 16 Principle 2: Compliance with Applicable Laws and Regulations ...... 17 Principle 3: Commitment to Long-Term Economic and Financial Viability ...... 18 Principle 4: Use of Appropriate Best Practices by Growers and Millers ...... 18 Principle 5: Environmental Responsibility and Conservation of Natural Resources and Biodiversity ...... 22 Principle 6: Responsible Consideration of Employees and of Individuals and Communities by Growers and Millers ...... 26 Principle 7: Responsible Development of New Plantings ...... 30 Principle 8: Commitment to Continuous Improvement in Key Areas of Activity ...... 30 4.3 NON -CONFORMITY RAISED DURING THIS AUDIT AND ANY FROM THE PREVIOUS YEAR , IF APPLICABLE ...... 32 4.3.1 Non-Conformities Identified during this Audit ...... 32 RSPOPC-SUM-REPORT.F01 JULY2013 Page 2 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

4.3.2 Non-Conformity Identified during the last ASA, not applicable for MA ...... 39 NON -CONFORMITIES IDENTIFIED FOR PREVIOUS AUDIT ...... 39 4.3.3 Observations Identified during this audit ...... 46 NO OBSERVATION FOUND IN THIS AUDIT ...... 46 4.4 ISSUES THAT WERE RAISED DURING THE STAKEHOLDER CONSULTATION , IF ANY ...... 47 PART 5: RSPO SUPPLY CHAIN CERTIFICATION ...... 47

5.1 POM INCLUDED IN THE SCOPE OF THE AUDIT ...... 47 5.2 CONFIRMATION OF THE COMPANY ’S SUMMARY OF ANNUAL CERTIFIED VOLUME OF RSPO CERTIFIED PALM OIL AND PALM KERNEL OVER A SPECIFIED PERIOD ...... 47 5.3 SUMMARY REPORT INCLUDING A BRIEF DESCRIPTION OF THE SCOPE OF CERTIFICATION ...... 47 5.4 MONTHLY RECORDS OF CERTIFIED AND UNCERTIFIED FFB RECEIVED SINCE THE LAST AUDIT ...... 48 5.5 MONTHLY RECORDS OF CERTIFIED CPO AND PK PRODUCED SINCE THE LAST AUDIT ...... 48 5.6 RECORDS OF CERTIFIED CPO & PK SOLD UNDER GREEN PALM TO BUYERS SINCE THE LAST AUDIT , IF ANY ...... 48 5.7 RECORDS OF CERTIFIED CPO & PK SOLD UNDER UTZ ETRACE TO BUYERS SINCE THE LAST AUDIT , IF ANY ...... 48 5.8 NON -CONFORMITIES IDENTIFIED DURING THIS AUDIT ...... 49 5.9 DESCRIPTION OF THE ORGANIZATIONAL MANAGEMENT SYSTEMS ...... 49 5.10 FINAL CERTIFICATION DECISION BY CONTROL UNION FOR THE RSPO SCCS AUDIT OF THE POM ...... 50 PART 6: CERTIFIED ORGANISATION’S ACKNOWLEDGEMENT OF INTERNAL RESPONSIBILITY ...... 50

6.1 DATE OF NEXT ASA ...... 50 6.2 DATE FOR CLOSURE OF NON -CONFORMITIES ...... 50 6.3 SIGNING BY THE CLIENT ...... 51 6.4 SIGNING BY THE LEAD AUDITOR ...... 51 6.5 SIGNING BY THE CERTIFIER ...... 51 PART 7: APPENDICIES ...... 52

APPENDIX 1: LOCATION MAP FOR THIS CERTIFICATION UNIT ...... 52

RSPOPC-SUM-REPORT.F01 JULY2013 Page 3 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

PART 1: SCOPE OF THE CERTIFICATION ASSESSMENT AUDIT

1.1 Company and Contact Details Company Name: Kuala Lumpur Kepong Berhad Business Address: 1, Jalan S. P. Seenivasagam, 30000 Ipoh, Perak. Contact Person: Mr. Sin Chuan Eng Office Telephone: +6052417844 E-Mail: [email protected] Web Site: www.klk.com.my Other Certifications Held: ISCC

1.2 RSPO Membership & Certification Details RSPO Membership Number: 1-0014-04-000-00 Registered Client Name: Kuala Lumpur Kepong Berhad Certificate Number: CU-RSPO-821298 Start Date Of Certificate: 10 th September, 2013 End Date Of Certificate: 9th September, 2018 Date Of Original Certification: 10 th September, 2013 Scope: Certification of the Palm Oil Mill and Supply Bases Type Of Certification: Single site Duration Of Certificate: 5 Years from date of certification

1.3 Annual Surveillance Assessment Details Dates Of This Audit: 02nd – 04 th June 2014 Audit Number: ASA 1

1.4 Assessment Type This is a RSPO Principles &Criteria Compliance assessment of the palm oil mill and its respective supply bases as listed in this report below.

1.5 Location of the Palm Oil Mill Name Mill Location GPS Reference Palm Oil Mill Capacity (POM) MT/Hour Address Longitude Latitude Batu 24, Jalan Kuala Selangor- KLK Tuan Mee 22 Kepong, 47000 Sg. Buloh, E 101.463279 N 3.265156 POM Selangor, Malaysia

1.6 Palm Oil Mill Output and Approximate Tonnages Certified Figures below are from: • Only from certified supply bases (Y/N). YES • Combining certified with uncertified supply bases (Y/N). NO • If the Mill is receiving FFB from uncertified supply bases outside the audit scope, such uncertified sources is highlighted under the following sections as seen applicable: a. PART 1, Section 1.7 – General Description of Supply Base, b. PART 2: Partial Certification , Section 2.4 – Uncertified Units or Holdings,

RSPOPC-SUM-REPORT.F01 JULY2013 Page 4 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

c. PART 5: RSPO Supply Chain Certification of this report Projected Production from the Actual Production for this Audit Year Projected 12 Months (MT) last 12 Months (MT) 2013 (MT) Forecast Certified in this Report May’13 to Apr’14 May’13 to Apr’14 May’14 to Apr’15 FFB CPO PK FFB CPO PK FFB CPO PK 65248 13227 3108 88517 18945 4501 93107 21511 5084

1.7 General Description of Supply Base Located in Tuan Mee Estate, Lot 815, Mukim Ijok, District of Kuala Selangor, Selangor. Malaysia. The mill started its operation in July 1973 and has a capacity of 22 MT FFB / HR. This mill processed 70% of its own estate crop and another 30% [9 supply bases] of outside crop. This mill occasionally receives crops from other KLK's certified mills, when there is mill maintenance works.

1.7.1 Location of the Supply Base Oil Palm Area Summary Location GPS reference OPP Plantation (Ha) Name Address Longitude Latitude Total Mature Batu 24, Jalan Kuala Selangor- Tuan Mee OPP 01 Kepong, 47000 Sg. Buloh, E 101.463279 N 3.265156 2763 2581 Estate Selangor, Kombok Jalan Lenggeng, Jalan Besar, OPP 02 E 101.888955 N 2.839161 281 281 Estate 71700 Mantin, Negeri Sembilan. Ulu Pedas OPP 03 71409 Pedas, Negeri Sembilan. E 102.066672 N 2.632623 903 825 Estate TOTAL 3947 3687

1.7.2 Statistics of the Supply Base and Estimated Tonnes of FFB produced per year OPP Oil Palm Plantation Estimated FFB/Year (MT) Planting Years Cycle (Years) OPP 01 Tuan Mee Estate 66,369 1989 - 2011 25 OPP 02 Kombok Estate 8,119 1992 – 2002 25 OPP 03 Ulu Pedas Estate 18,613 1987 – 2009 25 TOTAL 93107 - -

1.7.3 Conservation and HCV Area (Ha) * HCV part of OPP Oil Palm Plantation Conservation Area (Ha) HCV Area (Ha) Conservation OPP 01 Tuan Mee Estate - - - OPP 02 Kombok Estate - - - OPP 03 Ulu Pedas Estate - - - TOTAL - - - * Indicate if HCV area is part of the Conservation Area. If the HCV area is part of the Conservation Area, then “YES” otherwise, “No”

1.7.4 Percentage of Planted Oil Palm by different Age Ranges Planting Years by 5 year Ranges OPP 1989-1993 1994-1998 1999-2003 2004-2008 2009-2011 OPP 1 686 312 626 830 127 OPP 2 58 28 195 - - OPP 3 96 197 78 367* 87** Note: * Replanting, **Replanted & immature

1.7.5 Calculation of the Number of Production Units (N) to Sample for the Mill N = 0.8 √Y, where “Y” is the number of units, with the result always to be rounded “up” to the next whole RSPOPC-SUM-REPORT.F01 JULY2013 Page 5 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

integer. Where only a sample of the supply base is assessed, units not previously assessed, or assessed earlier in the certification program, are to be preferred over those more recently assessed For the Mill, how many units make up the production base? Owned estates (Y) N = 0.8 √Y Smallholders (Z) N = 0.8 √Z 3 2 0 NA Explanation as to the selection of estates sampled 2 estates were assessed. 1.8 Progress of associated S mallholders or Out -growers , if applicable to this assessment Progress of associated Smallholders or Out-growers towards Compliance with relevant Standards - should be in accordance to the 3 year implementation plan, if applicable to this assessment Not Applicable

1.9 Location Map for this Certification Unit (See Appendix 1)

PART 2: PARTIAL CERTIFICATION The rules for partial certification allow organizations that have a majority holding in and / or management control of more than one autonomous company growing oil palm to certify individual management units and / or subsidiary companies subject to certain rules.

2.1 Management Structure Section Criteria Yes/No If “Yes” If “No” 2.1.1 Is the certified operation (POM and supply base as No Section 2 is Go to 2.1.2 detailed above) a stand-alone operation and there are N/A no other plantations or mills owned by the same company? 2.1.2 Is the certified operation part of a simple structure of Yes Go to 2.1.5 Go to 2.1.3 operations owned by one company? 2.1.3 Are there statements of the ultimate controlling - Go to 2.1.4 Go to 2.2.1 shareholders and directors in the managing agency company/companies: a. Explaining the legal relationship and the management arrangements with the subsidiary companies and / or with any operating groups? 2.1.4 b. A statement of commitment to complying with the - Go to 2.4 Go to 2.2.2 spirit of the RSPO for all companies and subsidiaries involved with the growing of oil palm and for the production of palm oil? 2.1.5 Is there a time bound plan in place for all subsidiaries, Yes Go to 2.3 2.2.3 estates and palm oil mills? 2.1.6 Is the parent company or one of its majority owned and / Yes or managed subsidiaries a member of RSPO.

2.2 Non-compliance Identified with 2.1 Above Section Non-compliance findings NC raised Category 2.2.1 There is no explanation as to the company’s structure and therefore it - Major Is not possible to conduct an effective audit against the rules for partial certification. 2.2.2 There is no statement of commitment to complying with the spirit of - Major the RSPO for all companies within the company structure. 2.2.3 There is no time bound plan in place for the certification for all - Major subsidiaries, estates and mills. 2.2.4 No applicable membership of the RSPO. - Major

RSPOPC-SUM-REPORT.F01 JULY2013 Page 6 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

2.3 Summary of the Time Bound Plan Section Requirement Findings and any action required Compliance 2.3.1 Does the plan New inclusion of supply base and mill has been updated in Yes include all below time bound plan. subsidiaries, estates and mills?

2.3.2 Is the time bound Existing time bound plan has been included with new supply Yes plan challenging? base and mill.
Age of plantations.
Location.
Mill development.
Infrastructure.
Compliance with applicable law. 2.3.3 Have there been The time bound plan reviewed by CUC and changes such as new Yes any changes since inclusion is updated and accepted. the last audit? Are they justified? 2.3.4 If there have been New inclusion of mill and supply base. No changes on the Yes changes, what targeted time line. circumstances have occurred? 2.3.5 Have there been • Recent stakeholder comment on acquired land in Papua Yes any stakeholder New Guinea on the credibility on land obtained has been comments? raised by OCEAN-Program Officer Collingwood Bay Community Representative, Mr. Adelbert Gangai has sent comments to KLK on a letter dated 5 th December 2013 and kept RSPO & other parties in copy. Currently, KLK has leased a piece of a land to park all the machineries temporarily. As of 09 December 2013, this matter is being handled with RSPO and currently KLK is in progress to reply to RSPO. Wild Asia had been appointed since April 2013 to undertake SEIA assessment and subsequently 1 st meeting at Wanigela district on 25 th Nov 2013 and community and representative attended was recorded. Pending official assessment report. • On PT Menteng Jaya Sawit Perdana IUP for 7,400Ha approval no: 525.26/153/II/EKBANG/2007 dated on 13 February 2007 and Izin Lokasi(IL) is renewed and documented no: 188.45/359/HUK-BPN/2013 dated: 1 st August 2013 which includes an approval clause 1a that this IL will remain in force until land swap process is finalised. 2.3.6 Have there been No new acquisition other than Papua New Guinea. Yes any newly acquired subsidiaries? 2.3.7 Have there been No lapses. Yes any isolated lapses in implementation of the plan? 2.3.8 Has there been any No. Yes RSPOPC-SUM-REPORT.F01 JULY2013 Page 7 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

systematic failure to proceed with the implementation of the plan? 2.3.9 General statement The target to certify all the units within year 2015 remain same. Yes as to progress made since the last audit? 2.4 Un-Certified Units or Holdings NOTE: Companies may demonstrate compliance by clear evidence of a self-audit (i.e. an internal audit for all subsidiaries, estates and Palm Oil Mills) Section Requirement Findings and any action required Compliance 2.4.1 Did the company The internal control points have included all the requirements to Yes conduct an internal validate the compliance against uncertified units or holdings as audit? If so, has a per partial requirements and assurance statement has been positive assurance generated by KLK has a list of subsidiaries inspected and dated statement been 30 th Nov 2013. produced? 2.4.2 No replacement The company has conducted HCV assessment by Jump Yes after dates defined Consulting in January – February 2012 for all subsidiaries where in NIs Criterion 7.3 the assessment report confirms that there was no replacement of: of primary forest or containing HCV. The new mills and newly • Primary forest. acquired land are still under consultant preliminary report. • Any area identified as containing High Conservation Values (HCVs). • Any area required to maintain or enhance HCVs in accordance with RSPO criterion 7.3. 2.4.3 Any new plantings PT Anugerah Surya Mandiri has undergone NPP and published in Yes since January 1 st RSPO website on 1 st April 2013. 2010 must comply with the RSPO New Plantings Procedure. 2.4.4 Any Land conflicts For PT Karya Makmur Abadi, a total land of 4,745.13Ha has been Yes are being resolved compensated. PT Adei Plantation land conflicts around 2,544Ha through a mutually are still in progress of negotiation. agreed process, e.g. RSPO Grievance procedure or Dispute Settlement Facility, in accordance with RSPO criteria 6.4, 7.5 and 7.6. 2.4.5 Any Labor disputes None noted.no stakeholder comments or complaints received Yes are being resolved through a mutually

RSPOPC-SUM-REPORT.F01 JULY2013 Page 8 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

agreed process, in accordance with RSPO criterion 6.3. 2.4.6 Any Legal non- None noted. No stakeholder comments or complaints received. Yes compliance is being resolved in accordance with the legal requirements, with reference to RSPO criteria 2.1 and 2.2.

TIME BOUNDP PLAN FORECAST FOR RSPO CERTIFICATION OF ALL PALM OIL MILLS & SUPPLY BASES Current Supply Bases (estates, Targeted RSPO Palm Oil Mill Country Certification Status plantations, associations) Certification Year as per this Audit • Pelam Estate Serdang, Kedah. • Batu Lintang Estate Batu Lintang 2013 Certified Malaysia • Subur Estate • Buntar Estate • Landak Estate • Kekayaan Estate • Voules Estate • Sg Penggeli Estate Paloh, Johor. • New Pogoh Estate Kekayaan Oct 2011 Certified Malaysia • Fraser Estate • Paloh Estate • Sg Bekok Estate • Ban Heng Estate • See Sun Estate Paloh, Johor. Supply base consisting of Paloh 2015 Pending Malaysia smallholders • Ayer Hitam Estate • Batang Jelai Estate • Jeram Padang Estate Bahau, Negeri • Kombok Estate Jeram Padang Sembilan. • Ulu Pedas Estate Sept 2012 Certified Malaysia • Sg Pertanian Estate • Sg Kawang Estate • Renjok Estate • Tuan Estate • Changkat Asa Estate Tanjung Tanjung Malim, • Kerling Estate 2013 Certified Malim Perak. Malaysia • Sg Gapi Estate Sungai Buloh, Tuan Mee Selangor. • Tuan Mee Estate 2013 Certified Malaysia • Kerilla Estate Kuala Krai, • Pasir Gajah Estate Kuala Pertang Kelantan. By 2013 Pending • Sg Sokor Estate Malaysia

Tawau, Sabah. 100% independent Mill 1 N/A N/A Malaysia smallholders, not to be RSPOPC-SUM-REPORT.F01 JULY2013 Page 9 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

included in the scope of the certification • Pang Burong Estate Tawau, Sabah. • Sri Kunak Estate Mill 2 March 2009 Certified Malaysia • Tundong Estate • Ringlet Estate • Jatika Estate Tawau, Sabah. • Sigalong Estate Pinang March 2009 Certified Malaysia • Pangeran Estate • Pinang Estate • Tungku Estate Lahad Datu, Lungmanis • Bukit Tabin Estate July 2010 Certified Sabah. Malaysia • Lungmanis Estate Lahad Datu, • Rimmer Estate Rimmer July 2010 Certified Sabah. Malaysia • Sg. Sibalukan Kinabatangan, • Bornion Estate Bornion July 2010 Certified Sabah. Malaysia • Segar U saha Estate • Lekir Estate • Changkat Chermin Estate • Raja Hitam Estate Changkat Manjung, Perak. • Glenealy Estate 2013 Certified Chermin Malaysia • Serapoh Estate • Kuala Kangsar Estate • Allagar Estate • Kebun Malindomas Perkebunan, Berau, Kaltim. Berau 1 • Kebun Hutan Hijau Mas, By 2014 Pending Indonesia • Kebun Jabontara Ekakarsa Steelindo Audited on 30/9- Belitung, • Kebun Steelindo Wahana Wahana By 2013 04/10/2013. Indonesia Perkasa Perkasa Pending. • Kebun Parit Sembada Parit Belitung, • Kebun Alam Karya By 2014 Pending Sembada Indonesia Sejahtera Riau, Sumatera, Mandau • Kebun Mandau Oct 2012 Certified Indonesia Approved by RSPO, Riau, Sumatera, Nilo 1 • Kebun Nilo Timur By 2013 pending certificate Indonesia issuance. Approved by RSPO, Riau, Sumatera, NIlo 2 • Kebun Nilo Barat By 2013 pending certificate Indonesia issuance. Tapung Riau, Sumatera, • Kebun Sekarbumi By 2013 Certified. Kanan Indonesia Alamlestari • Kebun Basilam Langkat, • Kebun Gohor Lama Gohor Lama Sumatera Utara. By 2014 Pending • Kebun Tanjung Beringin Indonesia (New inclusion) Kebun Padang Brahrang Padang Sumatera Utara. Kebun Bukit Lawang By 2014 Pending Brahrang Indonesia Kebun Tanjung Keliling Kebun Bekiun RSPOPC-SUM-REPORT.F01 JULY2013 Page 10 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

Kebun Maryke (New Inclusion) Kebun Karya Makmur Abadi Kalimantan MAP March Kebun MAP Tengah. By 2015 Pending 2013 Kebun Menteng Jaya Sawit Indonesia Perdana 2.5 Summary of the findings for Partial Certification The audit team assessed compliance with the above requirements during this audit. Failure to address any non- compliance identified may lead to certification suspension. Overall findings are satisfactory and a minor non-compliance raised has been closed with an assurance statement. The 6 estates which have been excluded from time bound plan previously is included now with a target date. Out of the two mill in Kalimantan Timur, a new palm oil mill named Berau 2 POM is yet to commission. Stabat POM in Medan & KMA POM in Sampit has not commissioned and will be included in the time bound plan once ready. The company has also made decision to include Paloh Mill into certification by year 2015. Mill 1 which consists of 100% of independent smallholders will be shut down within 3 years from 2012. For final conclusion, please refer to table 3.1.

2.6 Partial Certification Audit Agenda Date Location Agenda 02/06/14 Tuan Mee POM Documentation review

PART 3: AUDIT PROCESS

3.1 About the Certification Body Control Union Certifications is a member of the Control Union World Group – an international inspection and certification body. CUC performs Audits and certification in many agricultural based fields such as FSC, RSPO, and Organic production, Sustainable Textile Production, Organic Exchange, GLOBALGAP, HACCP, BRC, GMP and GTP. CUC is accredited by the Dutch Council of Accreditation (RVA) on the European quality standard EN 45011 for the inspection and certification of CUC Organic program (according to the EU regulation 2092/91) and EUREPGAP program. When requested a copy of the accreditation certificate can be obtained from CUC.

3.2 Audit Team Lead auditor: Mahaswaran Maliyapan Team member 1: Mohd Rizal Team member 2: Jaruwat Boonrod Team member 3: Atiqah [Trainee Auditor ]

3.2.1 Qualifications of the Lead Auditor Requirement Qualifications A minimum of post high school (post-secondary Certified ISO 14001:2004 and OHSAS 18001:2007 Lead school) training in either agriculture/forestry, Auditor. environmental science or social sciences; At least 5 years professional experience in area of More th an 15 years of wor king experi ence in various work relevant to the assessment (e.g., palm oil industries . Fully trained in similar agriculture certification management; agriculture/forestry; ecology; social programmes such as RSPO, SCCS and RFS2. science); Training in the practical application of the RSPO Invol ved in RSPO assessme nt since 20 12 . Member of CUC criteria, and RSPO certification systems; RSPO audit team. Involved in audits conducted in Mal ay sia and Indones ia. Successfully completion of an ISO 9000:19011 lead Co mpleted ISO 90 01:2008, ISO 14001:2004 and OHSAS auditors course; 18001:2007 lead auditor course in June 2007. Training in the practical application of RSPO Invol ved in RSPO assessme nt since 20 12 . Member of CUC certification systems. RSPO audit team. Involved in audits conducted in

RSPOPC-SUM-REPORT.F01 JULY2013 Page 11 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

Mal ay sia and Indones ia. A supervised period of training in practical auditing Invol ved in aud it s condu cted in for many different against the RSPO criteria or similar sustainability companies in Malaysia and Indonesia. standards, with a minimum of 15 days audit experience and at least 3 audits at different organizations. RSPO endorsed lead auditors course. Co mpleted RSPO Lead Aud it or tr aining in Oct 2013 Signed code of conduct. Yes General knowledge of: Yes • RSPO P&C standards. Yes • CUC organizational structure. Yes • CUC quality systems. Yes • Lead auditor role. Yes • Report writing. Yes • Stakeholder consultation. Yes • Certification decision process. Yes • RSPO SCCS program manual. Yes • CUC filing systems. Yes • Correct use of RSPO trademarks. Yes • History and objectives of RSPO. Yes • CV available. Yes Completion of CUC RSPO lead auditor training. Yes

3.2.2 Qualifications of the Assessment Team RSPO Requirement Team Member Name Qualifications

Fluent in main local Mohd. Rizal Fluent in Bahasa and English languages and English. Atiqah Fluent in Bahasa and English Jaruwat Boonrod Fluent in English. Has understanding of Bahasa Malaysia

Field working Mohd. Rizal Post graduate qualification in Forestry with 5 experience in the palm years working experience in manufacturing and oil sector, or a forestry. demonstrable Atiqah [ Trainee Auditor ] Graduated on geo-science. equivalent. Jaruwat Boonrod More than 5years working experience in plantation and forestry. Involved in RSPO auditing since July 2012. Fully trained in similar agriculture certification Programme such as RSPO SCCS, ISCC

Good agricultural Mohd. Rizal Involved in RSPO assessment since July 2012. practices (GAP), Member of CUC RSPO audit team. Involved in integrated pest audits conducted in Malaysia and Indonesia. management (IPM), Atiqah [ Trainee Auditor ] Attended In-house GAP trainings. pesticide and fertilizer Jaruwat Boonrod Performed audit observation of GMP+FSA, use. USDA-NOP and EU organic, Global-GAP st andard.

Health and Safety Mohd. Rizal Completed ISO 9001:2008 lead auditor course in auditing on the farm January 2013.

RSPOPC-SUM-REPORT.F01 JULY2013 Page 12 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

and in processing Atiqah [ Trainee Auditor ] Attended ISO 9001 awareness trainings. facilities. (For example Jaruwat Boonrod Certified Lead Auditor for ISO 9001 and ISO OHSAS 18001 or 14001. occupational. Health and safety assurance system).

Workers welfare issues Mohd. Rizal Involved in RSPO assessment since July 2012. and social auditing Member of CUC RSPO audit team. Involved in experience. (For audits conducted in Malaysia and Indonesia. example with SA8000 or Jaruwat Boonrod Nil related social or ethical Atiqah [ Trainee Auditor ] Nil accountability codes).

Environmental and Mohd. Rizal Member of CUC RSPO audit team since July ecological auditing. (For 2012.Involved in audits conducted in Malaysia example experience and Indonesia since July 2012 in more than10 with organic agriculture, different companies in Malaysia and Indonesia. ISO 14001 or Atiqah [ Trainee Auditor ] Nil environmental Jaruwat Boonrod Certified Lead Auditor for ISO 9001 and ISO management systems). 14001.

Economic issues. Mahaswaran Quality, environment and OHSAS Lead auditor. Working experience in various industries. Auditing since 2007. Involve in RSPO Audit since 2012.

3.3 Audit Methodology 3.3.1 General Overview The Audit was carried out in conformity with the procedures as laid down in the CUC Procedure Manual and the RSPO Program Manual for the auditors and Certifier. During the Audit the qualified CUC auditors used the RSPO standard as endorsed for the country in which the audit took place and recorded their findings. Workers and local communities were interviewed and evidence sought to confirm ongoing compliance to include: • Chemical stores. Storage, MSDS leaflets, Herbicide mixing areas, PPE, Ventilation, Security. • Field inspections. Herbicide application programs. Harvesting sites and efficiency. Fertilizing operations. SOP’s. Soil maps. Land preparation. Ground cover. IPM. First aiders and boxes. Ground cover. Soil erosion. Field observations of all operations. • Worker interviews. OSH. Sexual, religious, racial harassment. Pay and contracts. Child labor. First aid. Awareness. • Re-planting sites. Zero burn. • HCV’s. Identification. Management plans. Environmental Impact Assessments. Implementation. • Riparian zones. Width. Current and future management. Non maintenance regimes. • Water management. Water courses. Water monitoring. • Road maintenance. Run off. • Social amenities. Social Impact Audits. • Local communities. Contributions made. Employment opportunities. Social impacts. Complaints procedures. • Workshops. Oil traps. Safe working environment. PPE. Diesel tanks. Environmental waste management. • Line sites. Interviews with householders. Inspection of water discharge points. Water improvement plans. Waste disposal. • Documentation review.

RSPOPC-SUM-REPORT.F01 JULY2013 Page 13 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

The Palm Oil Mill audit verification included the following activities: • Mill and workshop inspections. Documentation review & worker interviews. • Mill. SOP’s. Safe working environment. Gen sets. Walk ways. Signs. EFB. POME treatment. Emissions. Mass balance. Diesel tanks. PPE. Fire extinguishers. First aiders and boxes. Fuel and water usage. • OSH. Training. Management structure. First aiders. • Full document review. Completion of the checklist. Review and documentation of evidence. All aspects of RSPO P&C’s applicable. • Worker interviews. OSH. Sexual, religious, racial harassment. Pay and contracts. • Compliance against the RSPO SCCS certification scheme.

Verification: Verification of implementation was done through field observations, workshop and chemical store inspections, worker and community interviews and mill inspections as summarized above.

3.3.2 Assessment agenda for this Audit Date Location Auditors Main activities 08.30 Opening meeting Chaired by the audit team leader Tuan Mee • Introduction by team leader Mahas POM Office • Presentation by respective managers • Presentation of Palm Oil Mill source of FFB by respective Managers Supply Chain Certification Assessment of the POM (RSPO SCCS)

Mill inspection Mahas • Workshops 02/06/2014 Atiqah • Stores [Mon] • POM application • Document review Tuan Mee

POM Field operations Rizal • Worker interviews Jaruwat • Housing • Medical • Schools • Local communities • Environmental Field operations. • Worker interviews

• Chemical stores Mahas • Workshops 03/06/2014 Tuan Mee Atiqah • Housing [Tue] Estate Rizal • Medical Jaruwat • Schools • Local communities • Environmental

RSPOPC-SUM-REPORT.F01 JULY2013 Page 14 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

Field operations. • Worker interviews

• Chemical stores Mahas • Kombok Workshops Atiqah Estate • Housing Rizal • Medical Jaruwat • Schools • Local communities 04/06/2014 • Environmental [Wed] Auditors preparation for closing meeting. Additional field visits and meetings with managers if necessary. Closing meeting to be chaired by the audit team leader • Welcome and introduction by the team leader Tuan Mee All • Presentation of findings by the audit team POM Office auditors • Questions and answers • Final summary by team leader

End of assessment

PART 4 ASSESSMENT FINDINGS

4.1 Lead Assessor’s Summary and Recommendation for Certification The mill and supply bases visited (as per the above Tables 1.5 and 1.7.1) were assessed at field, office, facilities, stores and a document review was carried out in accordance to the RSPO principles and criteria. The audited RSPO management system’s documentations seen with minor changes that due to internal and external influenced factors that in relation to scope of certification. Specific evidence was recorded for estates and mill. Interviews with Estate Managers, Mill Manager, members of workers union and committee took place in both formal and informal environments and worker interviews were conducted at the supply base and the mill. The management is highly committed in maintaining the RSPO system by adopting to continuous improvement programs. There was no complaint or feedback received during the audit or during the field assessment when interviewing with the external stakeholders. Under partial certification rules, there is a time-bound plan established. For further clarification on Partial Certification, see PART 2 above. The management continually monitoring the established KPI / objectives that significantly rules the achievement of company’s corporate policy on RSPO. The mill is fully verified for RSPO SCCS system verification and it is found to be in full compliance. See PART 5 below. It is therefore the recommendation of the lead assessor that: • A certificate of compliance is maintained. Signed:

Name: Mahaswaran Maliyapan Date: 30/7/2014

4.2 Summary of the findings by Pri nciple s and Criteria • Over the 5 year period of the life of the certificate, there will be 4 annual surveillance audits • Identified Non-Conformities and noteworthy Positive and Negative Observations. • The RSPO require that this report contain findings by each principle and some example criteria. Please see table below.

RSPOPC-SUM-REPORT.F01 JULY2013 Page 15 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

Principle 1: Commitment to Transparency Criterion by Requests made by stakeholder were responded to and all these are well Audit Summary documented. Adequate information available for confidential information that being listed as publicly available. There are 2 Minor NCs issued. ASA 1 1.1 There are policies that is being placed at the notice board in the POM area. It includes the sexual harassment and violence policy, right to freedom, environmental, child employment, quality, PPE, equal employment opportunities etc. SOP for stakeholder request for information is available. The requests are recorded and being provided in appropriate languages and forms, once completed, stakeholders shall then acknowledge the completed action and response. SOP for consultation & meeting, and complaint & grievance are available too. Stakeholder meeting on 27/05/14, discussed issue are based on introduction of RSPO to stakeholders during the meeting. Explanation complain and grievances los book to stakeholders, EIA and SIA. Management also has been publicize the documents regarding policies on gender, PPE, emergency contact numbers, map, emergency planning route, etc. For request for information, requests are recorded and being provided in appropriate languages and forms, once completed, stakeholders shall then acknowledge the completed action and response. Sighted Request & Response used through Stakeholder Engagement form. Latest request is from 27/5/2014 by Mr. Socso, request: please ensure to the report any accident relate to worker to Socso .the action is done Other requests are being attended promptly. Stakeholder logbook is open for any stakeholders are in place. Latest request is from 27/5/2014 by Mr. Socso, request: please ensure to the report any accident relate to worker to Socso. No propose action is done yet. Approved by senior assistant Mr. Seow Kok Wei. Retention for 5 years sighted recorded in Master list of Documents issued 1.6.2012. ASA 1 1.2 List of document that is publicly available as per in Master list document issue date on 01/02/13. Includes Manual doc. and SOPs covering to the RSPO criteria includes environmental, social and legal etc. There are records regarding the land titles. Location plan of mill includes scale: one mile to one inch, Title : Mill drainage & flow system for effluent discharge, Drawing no: TMPOM/KCH/95, Date: 08/1995. OSHA manual is available in order to comply the requirements such as Occupational Safety and Health, Factories and Machinery, Pesticides, Scheduled Waste Disposal, Code of Practice on Prevention and Eradication of Sexual Harassment in the Workplace, and Principles and Criteria of RSPO relating with Occupational Safety and Health. OHS programs for 2014 are available. Latest training is on 26/4/14 which is the training for water treatment plan. A Minor Non-Conformity issued against criterion 1.2.1:The Group Plantation Director has already in progress of implementing / developing RSPOPC-SUM-REPORT.F01 JULY2013 Page 16 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

all the necessary Human rights policy. However at the period of audit, it is noted that the Human Rights policy is not publically available yet. ASA 1 1.3 A Minor Non-Conformity issued against criterion 1.2.1: There is no written policy on committing to a code of ethical conduct and integrity in all operations and transactions, which shall be documented and communicated to all levels of the workforce and operations.

Principle 2: Compliance with Applicable Laws and Regulations Criterion by The mill and estates have demonstrated compliance to all applicable local, Audit national and international laws with the exception of the implementation of the USECHH 2000 Regulations and the Scheduled Wastes Regulations 2005. Summary Legal ownership of land and its land use is clearly demonstrated through the respective land titles. Boundaries have been clearly demarcated. There have been no land disputes or claims involving the mill and estate. ASA 1 2.1 List of laws available included name of laws, regulatory authority/summary, license/permit/certificate and current status. A list of laws that applicable for both mill and estates sighted: -OSHA and regulations 1994 (Act 514) -Factories and Machinery Act with regulations (Act 139) -Pesticides Act and Regulations (Act 149) -Poison Act and Regulations 1952 (Act 366) -Kementerian Perdagangan. -MPOB -Road Transport Act 1987 (Act 333) -Employees Social Security Act and Regulations (Act 4) -Food Act and Regulations (Act 281) -Industrial Relations Act and Regulations (Act 177) - Trade Union Act and Regulations -Employees Provident Fund Act 1991 -Human Rights Commission of Malaysian Act. -Wetlands and climate Change 1999 The UN Convention on Biological Diversity -Stockholm Convention On Persistent Organic Pollutants (2001

To carry out periodic review and evaluation on the Laws & regulations list to ensure that any new/addition as well as changes and amendment are captured and update, through enquiring the laws books publisher and communication with law/enforcement officers. Evidence of method to update the applicable is through website. OSH and regulations 1994 (Act 514) has been updated through website of Department of Occupation Safety and Health Malaysia. The implementation of relevant laws were made through Management and communicated to concerned parties. ASA 1 2.2 There no land dispute since started 1995. SIA issue 01-04-2012, includes Flow, Hazards, Level of negative social impact and Mitigation measures. ASA 1 2.3 No new planting nor extension of existing one documented and seen during this audit. Replanting program in place for period of 2015 - 2021. As there is no new planting applicable, therefore formal HCV, EIA and SIA assessment not evidence. No negotiations concerning compensation for loss of legal or customary rights are as per this assessment period. Based on the land title, it

RSPOPC-SUM-REPORT.F01 JULY2013 Page 17 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

lease for 99 years, therefore no compensation issues involved. Since the RSPO certification date, there isn't any issues raised by stakeholders during stakeholder meetings. Based on the land title, it lease for 99 years, therefore no compensation issues involved. No new planting nor extension of existing one documented and seen during this audit, therefore no evidence available for communication to communities.

Principle 3: Co mmitment to Long -Term Economic and Financial Viability Criterion by The annual budget and 10 years projections for the mill and estate that Audit Summary details revenue and costs are available. Replanting programme for the estates for the next five years is also available. ASA 1 3.1 Documented production estimation for crop is available for year 2013 and 2014. For 2014, estimated production of FFB in m tonnes is 108,858. Kernel production in m tonnes for 2014 estimated amounts is 5,659. There are details expenditure estimates for financial year 2013/2014 It includes capital expenditure and indirect cost. No scheme smallholder. Fully matured area – 487 Ha and the current yield per hectare is 25 MT. For the KLK there is a KLK Sustainability Department to oversee all the RSPO implementation and continuous RSPO plan. Annual financial plan 2013/2014 “ Financial Year Estimate 2013/2014” sighted. Year FFB to deliver 2013/14 12206 2014/15 12534 2015/16 13220

Replanting calendar sighted for the period from 2015/2016 – 2019/2020. The 1st replanting programme is planned on 94Ha at field no.90A/94 that the felling process planned by 2016. and field no. TM91A/70 planed on 2018 However the projection information need for replanting not captured in the annual budget of 2013/14 as it falls in next financial year of 2015/16.

Principle 4: Use of Appropriate Best Practices by Growers and Millers Criterion by The mill and estate have a complete set of SOPs which is being strictly Audit adhered to and continuously monitored. Soil fertility is maintained along with soil erosion prevention that continuously carried out. IPM implemented in all Summary the estate and the use of chemicals are in accordance with the regulations. There is a comprehensive OSH policy implemented throughout the estate and mill. Trainings are being carried out as per the Annual Training Plan. ASA 1 4.1 In the mill SOP on the storage and issue of security seal, lubricant store, diesel used, laboratory, Boiler, engine room, reception station of FFB (Rev 2012). Based on the SOP mill also has develop safe operation procedure. For Supply chain requirement has been sighted in the SOP of Sustainability date on the 01.03.2013.SOP consist information as follow. SOP Receiving material. Processing material, Despatching material. In the estates sighted the GAP policy no GP/AGRIC/OP, 01-01-2007. GAP manual is covering operations from land clearing, replanting, harvesting, up keeping, Roads & Drains. Estate has furnished SOP for all stage of operations and in accordance with RSPO requirements issue no. 5 dated 01-01-2014. The Sop is covering operations from land clearing, safety of spray equipment for spray operation, workshop workers, water treatment plant, chemical handlers, replanting, harvesting, fertilizer applications etc. For the replanting show on the Group policy No: GP/AGRIC/OP7, issue 21 RSPOPC-SUM-REPORT.F01 JULY2013 Page 18 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

June 2005. The mechanism to ensure that of implementation sighted thru internal audit. The purpose of the internal audit is to verify records and procedure against specific requirement and relevant standards requirements. SOP is kept and will be updated periodically. Document issuance sighted for Master list of document dated on 01-01-2014. Record of the internal audit has been sighted. Internal audit has divided into 3 type of internal audit [OSH audit, RSPO audit, Internal audit department audit]. This 3 type of audit is to ensure that estate and mill comply with the company policy. ASA 1 4.2 Sighted the SOP 4.0 dated on 01/03/2013 for "Soil Erosion & Fertility and Road Maintenance". The GAP starts from the survey by Agronomist with recommendation for fertilizer application. The Agronomist and Estate Manager to review the applied practices periodically [at minimum half yearly]. Yield improvement stated in "Oil Palm Manuring Recommendations for 2013/2014" - ref: CZY/Advisory/2013/Tuan Mee /report, 29/7/13. Sighted the fertilizer application records for Jan'14 - Apr'14 and for March '14 sampled: Field HA SPH Fertilizer type Rate Bag Date [KG] 1990A 60 124 Ammonia Chloride 2.04 304 9/12, 10/12 1991A 2 35 124 Ammonia Chloride 1.36 115 11/3, 12/3 2000A 1 50 128 Ammonia Chloride 2.50 192 10/3 11/3

Sighted the AAR "Oil Palm Manuring Recommendations for 2013/2014" - CZY/Advisory/2013/Tuan Mee /report, 29/7/13. Leaf analysis results and nutrients levels documented in the AAR report. Result shows that the mean leaf N,P, K and B concentrations were lower compared to previous year partly due to the increasing of palm age and seasonal trend. For leaf nutrients leaf N level ranging from low to very low be mainly planted on shallow lateritic soil. Details of leaf and soil analysis conclude that estate nutritional status based on the 3 Years means was still below optimum hence moderately high to high rate of fertilizer will be recommendation. Company has applied empty fruit bunch in the field to replace potassium. Moisture retention as supplement from inorganic fertilizer. Record of using the EFB application has been sample as follow: application of the EFB for the March 2014 to date is 18.26 Ha.

RSPOPC-SUM-REPORT.F01 JULY2013 Page 19 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

ASA 1 4.3 Erosion control done by using mulch, terrace, tree planting at the riparian zones. There are procedures available, e.g. construction of terraces policy no: GP/AGRIC/OP5. Seen on field that leaves from the palms are pilled in such a way that it can minimised the exposed soil. There is also mulching procedure exist. Road maintenance program for 2013/14 available for all field areas and line sites. Sighted record for 1994 A on 14/05/14 and PM99 A/184 on May 2014. There is also expenditure spent for the maintanance. E.g march 2014 RM107,800. No peat land in the estate. There is an analysis done by the agronomist showing all the soil types, except of peat. Done in 2010-2013. There are 7 type of Soil in the estate area as Serdang, Muck, Kedah, Batu Lapan, Muchong, Malacca and Local alluvium. Type of soil map is available. There is soil types map covering all the estate area. So far there is no special management applied for specific soil types. Sighted the SOP 8 for erosion control dated on 01-01-2011. Frond staging and EFB mulching are also applied. Seen SOP 5 for road maintenance and map of the areas performed the maintenance work established and updated. Maintenance programs include the grading, compacting, gravelling and pothole. The record shows the program and status. ASA 1 4.4 There are trees planted at the riparian buffer zones (seen on field). The rainfall monitoring is done everyday with 1 rainfall station near the office. POME is treated in the mill 6 pond for effluent treatment, 2 is anaerobic and 4 for aerobic. POME is discharge to the river based on the approval from department of Environmental (DOE) of Malaysia. JPKK/13/000529.29 Mei 2012. Monitoring of the BOD that release to the river has been sighted every month. Record as shown as follow: 1) April 2014 59ppm. 2 )Mac2014 62ppm 3 )Feb 2014 62ppm. Based on the regulation BOD level is within 100ppm. The mill does water sampling every 3 months for e-coli and also does BOD sampling monthly. The tests are conducted by 3rd party laboratory. Seen on map and on field that no construction works taking place. Effluent treatment is done by the mill (seen at mill and explained on the diagram). A document showing water usage monitoring is avaliable. It is monitored monthly and the record includes 2009-2014 monitoring. Water management plan has been sighted in the SOP 5.Date on 01/03/2013.Mill water is coming from water catchment that near to the mill area.

Water is treated and using for workers for daily using. Either than water catchment water using tube well. There are 4 tube well has been sighted in the maps. Monitoring of the water usage per FFB is recorded in the water treatment record. Record shows Apr'14 1.31, Mar'14 1.39 and Feb'14 is 1.12. There are old palms in the riparian zone in 1997. There is no harvesting from these palms. Verified during site visit, the zone has been marked and signs are put along the river. No construction of any bunds or dam in this water way. ASA 1 4.5 Implementation of IPM is based on the SOP no 7.0 integrated pest management dated on 01.04.12. It contain information regarding on the implementation of IPM, including Spraying, Trunk injection Rat baiting. There is no IPM plan available as the estate not infected with any pest but with very

RSPOPC-SUM-REPORT.F01 JULY2013 Page 20 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

little / rare rat attacks. However the barn owl census record well maintained. Herbicide application records seen for circle spraying. Seen records for Jan - Mar2014 in field PM95A/76, PM98/135 and PM03A/114, Glyphosate, Ally, with details of man-day, labour cost, hectarage treated, labour cost per ha, a.i.. (lit), material cost and total cost, with status. Rat is the critical pest. Rat bating program for infested area with more than 3%, will conduct rat bating. Rat bating in field 93A, on 11/05/14, result after first bating= 47%. Checking at all palms in every 20th row for fresh rat damage. This represent a 6% census. If census result shows rat damage exceed 5% of the sampled palm, rat bating should start/continue. Replace the missing baits at 4-5 days intervals until the acceptance level fall below 20%. Use second generation baits. Under normal circumstance effective control can be achieve after 3-5 rounds of bating per cycle. ASA 1 4.6 Annual agrochemicals recommendation from AA (Applied agricultural resources S/B) for 2013/2014. SOP 2 on Safe use of agrochemicals, 01-02- 2012, mentioning on justification of agrochemicals used and its hazards to health. Based on AAR leaf sample, only herbicide application is applicable for circle spraying. Seen records for Jan - Mar2014 in field Glyphosate, Ally, with details of man-day, labour cost, hectarage treated, labour cost per ha, a.i.. (lit), material cost and total cost, with status. Chemical records including in and out flow are maintained and up to dated. Noted that during the visit to the chemical storage there is “Activator” which is used as the catalyst for other chemical. The pesticides used contains Flocoumafen 0.005% and Broadifaccoum 0.003%, cross checked with Pesticides Act 1974 (Act 149) and the relevant provision (Section 53A); and in accordance with USECHH Regulations (2000). Annual medical surveillance has been conducted as per recommended by the CHRA Report. Sighted annual medical surveillance report for both exposed to and none exposed to chemicals. As part of continuous follow up from the medical result, the internal medical Assistant will routinely check the worker's condition. Sighted the SOP 2 on Safe use of agrochemicals, 01-02-2012, justification of agrochemicals used. According to chemical store visit, sited class 3 & 4 chemicals. Pesticides list according to WHO with classification and other agrochemicals according to Approved list of pesticides registered for use in this estate. Also letter from MPOA 29/10/2007 circular no. 32/2007. Storage of chemicals are classified per class and type and location. PPE are applied to the store clerk and visitors. CSDS available. SW 305, SW 306 and SW 410 are the schedule wastes that sighted in the Inventory List [Peraturan 11 - Jadual Kelima]. Sighted for Mac 2014 records, SW 305 [680L]. Sighted the consignment note for approved collector, A and C technology . [Ref 001350] dated on 29/05/2014 for SW 410. Sighted annual medical surveillance report for both exposed to and none exposed to chemicals. As part of continuous follow up from the medical result, the internal medical Assistant will routinely check the worker's condition. Sample check of Bahrum and Hasanah both are spraying workers. Medical surveillance has been conducted on the November 2013 . ASA 1 4.7 Sighted the "Occupational Safety & Health Policy" dated on 10/01/2005 which was approved by Group Plantation Director. Sighted 5 OHS plans established and implemented. The plan focuses on PPE, safety awareness and avoidance of near miss. Sighted the HIRADC last was reviewed on 01/06/2013. Seen the HIRADC effectively covers the entire operation and activities in estate. Sighted the hazard identification and its risk analysis, where the higher the rating the more risk factors involved.

RSPOPC-SUM-REPORT.F01 JULY2013 Page 21 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

Spraying and manuring dated on 09/03/2014 were attended by 8 workers and SOP for harvesters[GP/P&G - 1.2.1]. Trainings are well covered of both local and foreign workers. PPE issuance records / logbook sighted for apron, goggle, safety helmet, respirator mask and nitrile glove. Seen the record of receiving acknowledgement of PPE [nitrile glove] issued to Selvam[7048G], Mukes[2957G] and Mahaletcumi[2446B]. Sighted the latest organization chart available [Jan 2014], the Chairman is Mr. Mohd Azman whom is the estate Manager. The Secretary is Mdm Shikin and the committee consisted of workers and management representative. Sampled OHS meeting minutes dated on 15/01/2014 and the frequency of meeting is on every 3 months. Seen the training record dated on 28/03/2013 by Hospital Assistant on First Aid. Seen whom attended the training. There is a record maintained for mini First Aid Kit to workers on-site, distribution list seen with various dates. There was a major accident recorded on 31/12/2013, whereby Mdm Umapathy Merudy [630226-10-7772] was broken her leg when the tractor she was travelling to worksite [Block 05B] felt on her right leg. Records of accidents seen for Jan - May 2014 [4 cases in 2014]. The types of injuries are Laceration and Punture wounds. Seen the "Slip Pengesahan Skim Pampasan Pekerja - SPPA], ref: JTK0803647 dated on 27/03/2014. The policy No. LWX/930355706/13/03/IPO for foreign workers insurance coverage [AXA Insurance]. As for local workers, the insurance coverage is from Great Eastern and sighted the monthly deduction of RM 20.00 from all level of workers. Sighted the "Borang JKKP 8(1)/(IV) submitted to DOSH, dated on 10/01/2014 summary as below: • fatality rate = 0 • incident rate = 0.537 • frequency rate = 1.723 • severity rate = 96.93 ASA 1 4.8 Sighted "Annual Training Program for Year 2013/2014", at which on every month an average of 1 training planned for all level of workers. The training calendar consisted with best management practices, environment, social and safety aspects. Among the trainings listed were the SOP training for harvesters, training on mannuring application, training for contractors, training for tractor drivers, etc. Sighted the training records for: Spraying and manuring dated on 09/03/2014 were attended by 8 workers. Both practical and theory types of trainings were provided. Evacuation drill dated on 03/03/2014 conducted by competent senior staff to all workers. Principle 5: Environmental Responsibility and Conservation of Natural Resources and Biodiversity Criterion by Environmental Impact Assessment has been carried out by the mill and Audit estates. A comprehensive identification of all waste has been recorded and disposal of scheduled waste has been carried out by an approved and Summary registered collector. Monitoring and analysis of waste is carried out regularly. Landfills were filled with non-biodegradable wastes such as plastics and an observation was raised for this matter. 1 Major and 2 Minor NCs issued. ASA 1 5.1 Environment Impact Assessment is developed based on SOP 10.0 issue/rev 2.0 dated on 01/03/2013 consist of identification of all activities or aspects of the palm oil mill those have impact to the environment. And for the implementation & maintenance, obtaining a site plan indicating that area where activities pertaining to POM and sensitive area in estate. Seen the evaluation of the risk level of the identified based on risk analysis matrix to

RSPOPC-SUM-REPORT.F01 JULY2013 Page 22 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

provide plan to mitigate negative impact and implement and monitored and to ensure that the details of the EIA are publicly available. As for the review process, the annual review of the EIA management review meeting and re- evaluate if any new activities in POM, changes of legislation and environmental issue raise by stakeholders. The assessment covered all operation activities in the mill from receiving the FFB until despatching CPO & PK out from mill compound. EIA review carried out and required mitigation measures identified in the risk assessment. The recent review done on 27/09/2013 by the mill assistants. Since previous audit, no extension of the mill nor renovations conducted. In the estate the EIA document were updated on 27/09/14 from the initial assessment established on 01/04/2012. For 2014 assessment, water treatment plant added activity in the field. Mitigation measures include training the workers reuse of spilled water during premix. Timeline for this action is set as on-going process and person responsible is Mr. Saifudin. The revision of EIA done by annual basis based on input received by stakeholders during the stakeholder consultation meeting sighted on 27/05/2014. Due to no changes identified in the mill operation, therefore no timetable for any change is required. During mill visit, the EIA was used as guide and no discrepancy found. in estate there seen no changes in operation activities. Negative impact were identified above has been taken sufficient mitigation measures action plan. Some of the negative impacts are domestic waste dumped in land, chemical residue and household waste water flowed into water source well identified in EIA. Water tank and fire extinguisher were sighted in standby mode. The ERP team also will react for others emergency case as well such a flood and chemical spillage. The EIA is planned and being review on annual basis. The recent review was on 27/09/2013. In estate the mitigation measure is reviewed to monitor the effectiveness by mock emergency situation (fire drill) programme on June 2014 under OSH training programme. ASA 1 5.2 HCV assessment was carried out based on SOP 11.0 – High Conservation Value (HCV) & Conservation Area Management. From the assessment carried out on 22/12/2012 by Mr. Azman (Estate Manager) identified no HCV area in the estate area. The assessment done in accordance to HCV Tool Kit by WWF version October 2009. Estate has conserved 2 water catchment ponds [each in a division] and cemetery in the estate. Measures to maintain the ERT done by management with restricted of hunting in the identified area. Appropriate signages were sighted during site visit.ERT identification assessment based on IUCN Red List of Threatened Species identified ERT present in the estate area: - Butterflies (Amathusia phidippus, Appias libythea, Elymnias panther - Bird – Collared, kingfisher, Greater coucal & spotted dove - Mammals – Long tailed macaque, Malaysian field rat, Wild boar, lesser mouse deer, Malayan porcupine, plantain squirrel & musang pulut. Sighted the training records for stakeholders as part of awareness towards HCV. records seen dated on 27/05/2014. The SOP-11 [appendix 2] guides the management plan which tackle on gazetted river banks, water catchment ponds, reserved forest area and conservation area. Surrounding neighbors [government, NGO's and local communities] always invited for the stakeholder meetings, which the venue used to discuss and review of the HCV issues. A Minor Non-Conformity issued against criterion 5.2.3: No evidence that such RSPOPC-SUM-REPORT.F01 JULY2013 Page 23 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

education programme regarding to status of RTE species was done for all units workforce. ASA 1 5.3 Mill have document titled “Identification of All Waste Products and Operational Plan to Reduce Pollution” was well documented. The plan objective is to maximise recycling and minimise the pollution. List of waste is updated by annually basis. Waste list is separated by scheduled waste & and common waste as below: Scheduled Waste - Spent lubricating oil - Spent oil filter - Spent batteries - Empty chemical containers By Product Waste - EFB, cake and POME effluent - recycle to estate as added product - Blake smoke / dust - frequent furnace cleaning - Fibre and shell - use as boiler fuel - Boiler ash - Scrap irons - Household rubbish SOP established in 01/03/2013 [SOP-10.0]. EIA reviewed and updated on 27/04/2014 for all the activities. The source of waste well identified in the "Environmental Impacts Assessment & Pollution Prevention Plan" dated on 27/09/13. Among the identified sources are office, workshop, water treatment, chemical store, etc. In the mill the waste are categorized as:  Laboratory chemical containers An empty chemicals container that was using in laboratory is collected back by supplier [Chemindus Sdn. Bhd.]. Record of collector available e.g dated on 03/05/14 for 8pcs (25 liters drums).  Raw water treatment chemicals Sent to the supplier back.  Spent lubricating oil [SW 305], Spent hydraulic oil [SW 306] and Cotton rags [SW 410] - (scheduled waste) Sources from vehicles, machinery and workshop is mitigate action taken was the waste will be dispose with the correct way which is collected by DOE approved collector A & C Technology Waste Oil Sdn Bhd (License no. 001350/001286). Spent batteries [SW 103], Clinical waste [SW 404], Disposed containers, bags or equipments [SW 409], Spent lubricating oil [SW 305], Spent hydraulic oil [SW 306] and Cotton rags [SW 410] - (scheduled waste). Sighted the inventory list [Jadual 5]. The schedule waste being dispose with the correct way which is collected by DOE approved collector A & C Technology Waste Oil Sdn Bhd (License no. 001350/001286). Mill have document titled “Identification of All Waste Products and Operational Plan to Reduce Pollution” was well documented. The waste management plan objective is to maximise recycling and minimise the pollution. List of waste is updated by annually basis. Operational Plan contains details such as waste products / sources of pollutions / mitigation measures / Target & Person Responsible. Sources from mill wastewater. Waste water is treated using ponding system before discharging into cascaded pits for land application, monthly testing and monitoring of effluent samples and new installation of belt press to remove solid. POM generated recycle biomass that being sent to Tuan Mee for field mulching and land application. Data from April – May 2014 a per:

RSPOPC-SUM-REPORT.F01 JULY2013 Page 24 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

Type Jan'14 Feb'14 Mar'14 EFB 1511MT 751MT 1518 Decanter Cake 121MT - 4. 7MT In the estate the "Environmental Impacts Assessment & Pollution Prevention Plan" dated on 27/09/13 identifies the ways to avoid or reduce pollution. ASA 1 5.4 Mill has sufficient plans to reduce the usage of the fossil fuel that included in the 2013/2014 budget. Plan is to replace the Genset that consume [15Liters/hr] of diesel used in palm oil mill. Monitoring of energy usage per tonne of FFB processed was monitored by SOP 12.0 Waste Management & Energy Use issue/revision 2/0 dated on 01/03/2013. Data sighted for period Oct 2013 – March 2014. Month Diesel usage[L] FFB processed [MT] Litre/MT Nov'13 2440 7363 0.33 Dec'13 2540 7096 0.36 Jan'14 2060 6657 0.30 Feb'14 1640 3467 0.47 Mar'14 1890 8163 0.23

In the estate fossil fuel usage was monitored by SOP 12.0 dated on 01/03/2013 titled “Energy Usage”. Record from Jan till Mar 14 sighted as below: Month Diesel usage FFB Transported Litre/MT Jan 5712 4278 1.34 Feb 6440 3928 1.64 Mar 6187 4306 1.44

ASA 1 5.5 No land burning preparation in KLK Group company. Policy of Zero burning well implemented. KLK has stated on zero burning in the SOP-09 dated on 01/01/2011. The upcoming replanting schedule to be in 2015. During field visit not observed any open burning in the operating units. Apart from the policy, Guidelines for the implementation of the ASEAN policy on zero burning used for reference. KLK has stated on zero burning in the SOP-09 dated on 01/01/2011. ASA 1 5.6 Mill have document titled “Identification of All Waste Products and Operational Plan to Reduce Pollution” well documented. List of waste is updated and the operational plan contains details such: - Waste products - Sources of pollutions - Mitigation measures - Target - Person Responsible - Status Mill has identified the significant GHG emission by CO2 from POME treatment (93,566,129 kgCO2e) on 2013 record. Monitoring of GHG emissions from estate was updated on annual basis. Mill has identified the significant GHG emission by CO2 from POME treatment (93,566,129 kgCO2e) on 2013 record. A Major Non-Conformity issued against criterion 5.6.2: Significant of pollutant and GHG emission not been identified. Plans to reduce or minimize the GHG emissions that include objectives, targets and timelines not available. A Minor Non-Conformity issued against criterion 5.6.3: Since there is no plans to reduce or minimize the GHG emissions therefore the monitoring

RSPOPC-SUM-REPORT.F01 JULY2013 Page 25 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

system not auditable. Principle 6: Responsible Consideration of Employees and of Individuals and Communities by Growers and Millers Criterion by The mill and estate have conducted the social impact assessment. The Audit relevant policies are in place and are fully implemented across the board. Communication and consultation as well complaints and grievances Summary procedure are well communicated and adhered to. There are evidences of workers not been discriminated against in any way and all are being paid their fair wages. 1 Major and 1 Minor NCs issued. ASA 1 6.1 In mill the SIA procedure sighted dated 1.3.2013 for SOP 13 issue 2/0. The latest assessment was on 21 March 2014. 70 workers registered as employee of Tuan Mee Mill. Stakeholder of the mill nearly 101 over people excluding external stakeholder. In the estate the SIA assessment procedure sighted last update on 2012 for SOP 13 issue 2/0. Sighted Analysis on SIA Questionnaire with no date and no evidence shown to proof that the questionnaire is being distributed to the workers. 337 workers registered as employee of Tuan Mee Estate. Stakeholder of the estate nearly 400 over people excluding external stakeholder. There is a list on SIA dated 1/4/2012. The list is same as what stated in the latest SIA dated 21/3/2014. Smallholder schemes not applicable. A Major Non-Conformity issued against criterion 6.1: A documented social impact assessment given was not conducted as per the procedure SOP 13 as stated above.Assessment done with affected parties not evident. A timetable with responsibilities for mitigation and monitoring reviewed and updated as necessary not evident. ASA 1 6.2 Both in the mill and estate the SOP 1.0 Stakeholders engagement / negotiation dated 1.3.2013 rev 2 shown as a documented consultation and communication procedure. PIC personnel available. Tuan Mee POM Manager Mr. George is responsible for RSPO issues. PIC personnel available. Tuan Mee Estate Manager Mr. Mohmad Azman Abdul Majid is responsible for RSPO issues. List of stakeholder updated on 1/4/2012. Mr. Wan Kamarruddin, the FFB suppliers of Tuan Mee Mill is sighted listed as stakeholder. Apart from Ex: Dr Vasukie visiting medical officer, Avecpalm Marketing Resources are in list. List of stakeholder available with no update date. 55 stakeholder listed. Mr. Wong Yu Sang, Ijok village leader is sighted listed as stakeholder. Apart from Ex: police, headmaster of SJK (T) Tuan Mee, Mr. Hazimi from Sime Darby Plantations are in list. Invitation for all stakeholders for stakeholder meeting is available. ASA 1 6.3 Both in mill and estate the SOP 1.0 dated 1.3.2013 Complaints & Grievance is shown at para 3 the process of complaints & grievance. The mill manager and his assistants handles grievances and dispute issues. Max 1 month; depending of the severity of problem; leaking-2-3 days. No complain registered; all request has been solved. Many complain were verbally received and corrected on house repair / electrical repairs. Ex: Mr. Puvaanan, asking for mosquito netting replacement. His request has been attended promptly on 28/5/2014 by replacing mosquito netting. In the estate, the manager and his assistants handles grievances and dispute issues. Max 1 month; depending of the severity of problem. No complaint registered and all request has been attended promptly. Request is being requested through stakeholder logbook form. Many complain were verbally received and corrected on house repair / electrical repairs. Ex: Ms. Norra Alam requested to fix her house floor, door and sink on 10/3/2014. All her request are being attended promptly on 31/3/2014. Latest request is by Pn. Aishah from Socso where she asked for estate management to report any RSPOPC-SUM-REPORT.F01 JULY2013 Page 26 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

accidents to Perkeso. ASA 1 6.4 No negotiations concerning compensation for loss of legal or customary rights are as per this assessment period [this land where the Tuan Mee POM stand is belong to estate]. ASA 1 6.5 In the mill randomly interviewed workers for their awareness on their pay: 1. Sterilizer – Maksum [Indonesian] 2. Effluent – Muhson [Indonesian] 3. Female – Gardener – Puspavally A/P Muniandy [ Local ] Pay wages & slip evident; employee understood the salary itinerary. Minimum pay of RM 34.62 as per the government regulation sighted and verified. Maksum - April 2014 [RM 1141.12]; deduction for Advance and union fee; for slip no 44. Puspavally - Aug 2013 [RM 665.68]; deduction for Union, EPF, Socso, Advance; for slip no 4. Contract verified; local staffs, foreigner has their own agreement. Workers understood contract Terms & condition evident. Maternity record us unavailable since there are only 2 female workers who already ages and most of the workers are male. In estate Sampled and interviewed 1. Hasnah - Malaysian – Sprayer 2. Sahabudin – Indonesian - Harvester Pay wages & slip evident; employee understood the salary itinerary. Minimum pay of RM 34.62 as per the government regulation sighted and verified. Pn Hasnah Binti Amat [Malaysian] – Aug 2013 [RM 737.77]; deduction for Union, EPF, Socso, Advance; for slip no 131. Mr Sahabudin - April 2014 [ RM1019.16]; deduction for advance and union fees. Contract verified; local staffs, foreigner has their own agreement. Workers understood contract Terms & condition evident. Maternity pay is sighted for Ms. Farhana, estate office staff for Oct and Nov 2013. For workers, there are no maternity records. o Overtime doesn’t exceed the national labour law requirement o Rest day complies o Public holiday complies During the mill worker's line site visit, sanitation-ok, Free electric generated by POM, Free water – own water treatment, Water drinkable and no un- authorize extension. Interview done for local and foreign worker, Nurhamdi (Indonesian), Mansoor Ahmed (Malaysian). According to them, there are no salary deduction for water and electricity. Medical treatment also free at the company clinic. During the estate worker's line site visit, sighted the sanitation-ok and just get supply from SYABAS. Electric usage is paid by the worker to TNB. Interview Mr. Sekaran and Mr. Arumugan. Nearest town is Ijok; which is 5km. Groceries shop is available in estate line site. Few merchant [vegetable / fish/ meat] seen coming for business. ASA 1 6.6 There is policy regarding freedom of association displayed in the mill's office. Mr. Jay – Assistant Engineer, understood and able to explain the policy. In the estate the policy displayed in the main office. Mr. Shaifuudin Natzri – Assistant Engineer, understood and able to explain the policy. For mill. the gender Committee meetings being conducted twice/year. Last meeting is on 20/3/2014 where secretary and other 4 members were present. Welfare of female workers were discussed. In the estate the gender Committee meetings being conducted twice/year. Last meeting is on 25/4/2014 where 9 members including leader and secretary were present. Welfare of female workers were discussed. ASA 1 6.7 The company has created and implementation of minimum age, it was stated in policy of “Child employees”. According interview with workers and staff and document review, it confirmed that no workers below 18 year old

RSPOPC-SUM-REPORT.F01 JULY2013 Page 27 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

working in all operation units. In mill, the youngest/latest worker is Mr. Muhammad Sukri from Indonesia (birth on date 8/4/1994; started 28/5/2014 - when he start work in 20 years 1 months old). Interviewed Mr. Chia – Assistant Manager. In estate the youngest/latest worker is Mr. Jumah Pathi [Indonesian] (birth on date 26/1/1995; started - when he start work in 19 years 3 months old). Interviewed Mr. Shaifuudin – Asst Manager. ASA 1 6.8 Policy of equal opportunities publicly displayed in office and at line-site. According interview with workers. From NUPW proposed meeting, they want to discuss on discrimination of overtime offered among different category of worker. The proposed date for the meeting is on 6/6/2014. Sighted letter from NUPW to use mill meeting room dated 19/5/2014 with reference NUPW/SSB/OM: 065/14. Interview union leader, Mr. Sundreraju, and he verified this issue. According to him, some positions get 6days/week OT where the actual agreement said only 4days/week. According interview with workers, the company has implemented equal opportunities to all workers, including migrant workers.No advertisement sighted. ASA 1 6.9 A policy on sexual harassment and violence in the workplace; including for reproductive rights. In the mill. during gender committee meeting, any sexual harassment incident is being asked by the chairperson, Pn. Nabisa Jamil. Moreover, there are monthly checklist on monitoring of sexual harassment done. Other questions asked by the chairperson in every meeting are also regarding pregnant woman, breast feeding woman and domestic violence. Interview – Pn. Sabariah (secretary) and Pn. Thenmoli (member). Gender committee meeting is being conducted twice/year. Last meeting is on 20/3/2014 where secretary and other 4 members were present. Welfare of female workers were discussed. Minutes meeting available . Pn Sabariah – Gender Committee Secretary interviewed. There are evidence on matters regarding sexual harassment, violent, breastfeeding and pregnant lady being discussed during the meeting. In gender committee meeting in estate, any sexual harassment incident always being asked. Up to day of audit, no sexual harassment is being reported. There are no pregnant and breast feeding woman. Interview – Pn. Asnah, Pn. Kaladeri, Pn. Mahalachemi. A policy on reproductive right incorporated in the “Sexual harassment and Violence Policy”that communicated thru gender meeting. There are no restriction regarding reproductive rights as in KLK sexual harassment and violence policy and female employee can get pregnant if they want. There are no records on pregnancy. Female employee who intend to have pap smear check-up or another medical consultation regarding women health can go to Ijok government clinic. Gender committee meeting is being held 3 times/year. Latest gender committee meeting is on 25/4/2014. Issue discussed are regarding outdoor activity, waste management, and medical for employee children, etc. Complaint is being brought to management but no documented evidence regarding action taken by management. Ex: waste management reported during gender meeting. ASA 1 6.10 The price for FFB supplier is vary and decided by the HQ. There are matrix on the FFB pricing that include supplier, FFB tonnage delivered/MT, OER%, Ker%, processing charges/MT, transport charges/MT, MPOB cess, and terms effective. Ex: Landta Rasmi, <800 @ >=800, 19.25 @ 19.50, 5.00, RM 46.00, RM 20.00, RM 13.00, and 1/8/2013. In estate sighted a MAPA circular No.11/2014, dated 21/4/2014 the oil palm wage rates for May 2014 is RM 2834.50/tonne. Price bonus is RM 5.50/full day. Wages rates is RM 34.62

RSPOPC-SUM-REPORT.F01 JULY2013 Page 28 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

p.d. Worked. There is SOP regarding FFB pricing mechanism last update 1/3/2013. The pricing for every suppliers are being decided by HQ. The contract between company and a contractor are available. The latest contract is between Tuan Mee POM and Mr. M Tiyagarajan, for cleaning steam drum and mud drum for Vickers Hoskins water tube type boiler, contract No 10-2013/2014. Documents are kept in the mill office. The document review of payment to contractor is confirmed that all payments have been made in a timely manner. Ex: Mr. Tiyagarajan and paid twice. Payment voucher No 610317 of RM 1000.00 is being paid on 18/2/2014 for advance. The remaining RM 7000.00 is being paid on 7/3/2014, with cheque No 171371. In estate sighted a contract between company and a contractor is available. Sighted contract, the documents are kept in estate office. Ex: Sundry/Petty Contract No 19-13/14 between Tuan Mee Estate and Pembinaan & Perniagaan Juta Mewah to carry out carpeting work in the estate. This contract will expire on 31/9/2014. Documents are kept in the mill office. The document review of payment to supplier is confirmed that all payments have been made in a timely manner. Ex: Contractors Work Order No 271634, for Pembinaan & Perniagaan Juta Mewah. RM 9800.00 has been paid for additional works for workshop, staff quarters & office piping work. Cheque no MBB 252406. ASA 1 6.11 In the mill, there is record of CSR from Cheque Remittance Advice dated 14/5/2014. Cheque No 216981 for RM 400.00 is being paid to Kelab Balai Bomba Batang Berjuntai. In estate the record of CSR in ending April 2014 stated for RM 461.78 is spent on transport allowance (bus fare) for school children, and RM 4805.83 for service gratuity. The record of CSR in ending March 2014 stated, RM 461.78 is spent on transport allowance (bus fare) for school children. Moreover, there are records for education allowance for employee children. Ex: 3 Mr. Hilme (MA) children got RM 60/each allowance monthly. Smallholder schemes not applicable. ASA 1 6.12 In mill interviewing the workers and stakeholders revealed that there is no forced or labor trafficking involved. Employee’s contract reviewed and found there is no contract substitution has occurred. Temporary worker not employed. Migrant workers – 62 employees employed. Sighted labor policy and labor contract is general with local employees.  No contract substitution  Post-arrival orientation programme  Decent living conditions to be provided  Statement of the non-discriminatory practices As in the estate, interviewing the workers and stakeholders revealed that there is no forced or labor trafficking involved. Employee’s contract reviewed and found there is no contract substitution has occurred. Temporary worker not employed. Migrant workers – 291 workers; from Bangladesh, India, Indonesia employed. Sighted labor policy and labor contract is general with local employees.  No contract substitution  Post-arrival orientation programme  Decent living conditions to be provided ASA 1 6.13 In countries and communities where KLK operates, social issues are part of a broader set of complex socioeconomic and security concerns and being apply to many aspects of their business. The management of human rights issues in KLK is based on the totality of their efforts and not on a single activity. Their corporate policies, management processes, community investment programs

RSPOPC-SUM-REPORT.F01 JULY2013 Page 29 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

and participation in voluntary initiatives are complementary and are intended to work together and reinforce their commitment to respecting human rights. A Minor Non-Conformity issued against criterion 6.13.1: However a policy to respect human rights not documented and communicated to all levels of the workforce and operations. Principle 7: Responsible Development of New Plantings Criterion by Summary There were no new plantings carried out. Audit ASA 1 Summary There were no new plantings involving forest land. ASA 1 7.1 No new planting nor extension of existing one documented and seen during this audit. Replanting program in place for period of 2015 - 2021. Based on the Group Policy - Oil Palm dated 17 July 2010, there is no SOP established for new planting. The management claimed there is no oil palm extension in Malaysia. There is no out grower scheme associated with this estate. ASA 1 7.2 New planting not applicable however AAR prepared the annual soil & leaf sampling and topographic informations for current estates. Topographic information for the existing estate sighted [AAR/19-03-2010], GPS Survey 06/2004/Sd, last updated 04/2008/3 topo_wor/Vic. ASA 1 7.3 No primary forest sighted within this estate perimeter. The estate neighbor to industrial park and residential estate . No HCV area identified and the matured youngest palm is 2008. As there is no new planting applicable, therefore formal HCV assessment not evidence. No new planting programme applicable. As there is no new planting applicable, therefore formal HCV, EIA and SIA assessment not evidence. ASA 1 7.4 AAR report on "Oil Palm Manuring Recommendations 2013/14 for Ladang Sungai Penggeli" sighted with estate's geographical condition. No peat land and due to no hilly and sloping areas, therefore terraincing not applicable. The annual AAR report will be used as guideline for existing estate mature palm management and for replanting. ASA 1 7.5 As there is no new planting applicable, therefore formal HCV, EIA and SIA assessment not evidence. ASA 1 7.6 No new planting nor extension of existing one documented and seen during this audit. Replanting program in place for period of 2015 - 2021. As there is no new planting applicable, therefore formal HCV, EIA and SIA assessment not evidence. No negotiations concerning compensation for loss of legal or customary rights are as per this assessment period. Based on the land title, it lease for 99 years, therefore no compensation issues involved. Since the RSPO certification date, there isn't any issues raised by stakeholders during stakeholder meetings. Based on the land title, it lease for 99 years, therefore no compensation issues involved. No new planting nor extension of existing one documented and seen during this audit, therefore no evidence available for communication to communities. ASA 1 7.7 KLK has stated on zero burning in the SOP-09 dated on 01/01/2011. The upcoming replanting schedule to be in 2015. During field visit not observed any open burning in the operating units. Apart from the policy, Guidelines for the implementation of the ASEAN policy on zero burning used for reference. KLK has stated on zero burning in the SOP-09 dated on 01/01/2011. ASA 1 7.8 No new planting nor extension of existing one documented and seen during this audit.

Principle 8: Commitment to Continuous Improvement in Key Areas of Activity Criterion by Summary Sighted continuous monitoring, review of activities and development are

RSPOPC-SUM-REPORT.F01 JULY2013 Page 30 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

Audit implemented along with action plans that allow demonstrable continual improvement in key operations such as in minimizing use of certain pesticides, environmental impacts, maximizing recycling and minimizing waste or by-products generation, pollution prevention plans. ASA 1 8.1 As in the mill, the steam generation process, only using shell during start-up boiler and fibre throughout processing period. If at all pressure drops significantly below 220psi, then some shell added to rise up the pressure. Continues Emission Monitoring System [CEMS] in place directly linked to DOE every day. stack emission sampling done twice annually in accordance to DOE requirement. EIA seen reviewed on 27/09/2013. There is waste disposal management plan associated with CIP. Oil losses after De-oiling tank to effluent sighted for Mar 2014, at 0.70 - 0.8% after the cooling pond to 1st anaerobic pond. Recycling activities being tabulate in the "waste Generated & Pollution Reduction Plan for 2014". The recycling includes such as EFB for mulching, Scrap iron, Land application, Fibre, boiler ash etc. All recycling of effluent is done at de-oiling tank which is in a contained bund complete with skimmer and pump.

As for Clarification, Purification and Separation process, the sludge produced are discharge to de-oiling tank and cooling pond and then it pumps to effluent treatment plant by way of open ponding system before discharging points. BOD recorded below 100ppm as per DOE regulation. As for Depericarpering and Kernel recovery, the mitigations measures are enforcing the operators to wear ear plugs at all time.

RSPOPC-SUM-REPORT.F01 JULY2013 Page 31 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

4.3 Non-conformity Raised During this Audit and Any from the Previous Year, if applicable This section gives an over view of new or revised non-conformities raised during this audit and of action taken to close out non-conformities raised during the previous audits, if applicable • If a minor-non-conformity raised at the last audit, is not closed out, then this will be raised to Major status and the company given 60 days to close this out. • The NC number is comprised of 2 parts to include the year in which the NC was raised as well as a sequential number.

4.3.1 Non-Conformities Identified during this Audit 2 major and 5 minor Non-Conformities Identified.

NON CONFORMITY REPORT NC number: 01/2014 Client name: KLK Tuan Mee Complex Date raised: 04/06/2014 Major or Minor: Major Raised by: Mahaswaran Maliyapan Aspect of standard: Criterion: 5.6.2 - Significant pollutants and greenhouse gas (GHG) emissions shall be identified, and plans to reduce or minimise them implemented. Evidence of non-conformity: Significant of pollutant and GHG emission not been identified. Plans to reduce or minimize the GHG emissions that include objectives, targets and timelines not available. Auditors signature:

Date: 04/06/2014 Proposed corrective action / improvement action by company: An immediate meeting was organized after the audit’s closing meeting among all staff that involved in the GHG assessment, a review was conducted and assignment delivered on.

Timeline for conformance: 60 days Review of corrective / improvement action: Sighted the “REDUCING/MINIMISING GREENHOUSE GAS (GHG) EMISSIONS PLAN” which dated on 15/07/2014. The effectiveness of the monitoring activities will be verified in next assessment.

Assessors signature:

Date: 30/07/2014

RSPOPC-SUM-REPORT.F01 JULY2013 Page 32 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

NON CONFORMITY REPORT NC number: 02/2014 Client name: KLK Tuan Mee Complex Date raised: 04/06/2014 Major or Minor: Major Raised by: Mahaswaran Maliyapan Aspect of standard: Criterion: 6.1.3 - Plans for avoidance or mitigation of negative impacts and promotion of the positive ones, and monitoring of impacts identified, shall be developed in consultation with the affected parties, documented and timetabled, including responsibilities for implementation. Evidence of non-conformity: A documented social impact assessment given was not conducted as per the procedure SOP 13 as stated above.Assessment done with affected parties not evident. A timetable with responsibilities for mitigation and monitoring reviewed and updated as necessary not evident. Auditors signature:

Date: 04/06/2014 Proposed corrective action / improvement action by company: a meeting was organized on 07/07/14 as to address the corrective action. SIA for mill was carried out in accordance to the procedure.

Timeline for conformance: 60 days Review of corrective /improvement action: Sufficient documented evidences provided and accepted by LA as for desk verification. However the stakeholder involvement in the assessment to be further check in next assessment by interviews.

Assessors signature:

Date: 30/07/2014

RSPOPC-SUM-REPORT.F01 JULY2013 Page 33 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

NON CONFORMITY REPORT NC number: 03/2014 Client name: KLK Tuan Mee Complex Date raised: 04/06/2014 Major or Minor: Minor Raised by: Mahaswaran Maliyapan Aspect of standard: Criterion: 1.2.1 - Publicly available documents shall include, but are not necessarily limited to: • Land titles/user rights (Criterion 2.2); • Occupational health and safety plans (Criterion 4.7); • Plans and impact assessments relating to environmental and social impacts (Criteria 5.1, 6.1, 7.1 and 7.8); • HCV documentation (Criteria 5.2 and 7.3); • Pollution prevention and reduction plans (Criterion 5.6); • Details of complaints and grievances (Criterion 6.3); • Negotiation procedures (Criterion 6.4); • Continual improvement plans (Criterion 8.1); • Public summary of certification assessment report; • Human Rights Policy (Criterion 6.13). Evidence of non-conformity: The Group Plantation Director has already in progress of implementing / developing all the necessary Human rights policy. However at the period of audit, it is noted that the Human Rights policy is not publically available yet . Auditors signature:

Date: 04/06/2014 Proposed corrective action / improvement action by company.

Timeline for conformance: next surveillance Review of corrective /improvement action:

Assessors signature:

Date:

RSPOPC-SUM-REPORT.F01 JULY2013 Page 34 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

NON CONFORMITY REPORT NC number: 04/2014 Client name: KLK Tuan Mee Complex Date raised: 04/06/2014 Major or Minor: Minor Raised by: Mahaswaran Maliyapan Aspect of standard: Criterion: 1.3.1 - There shall be a written policy committing to a code of ethical conduct and integrity in all operations and transactions, which shall be documented and communicated to all levels of the workforce and operations. Evidence of non-conformity: The Group Plantation Director has already in progress of implementing / developing all the necessary Human rights policy. However at the period of audit, it is noted that the Human Rights policy is not publically available yet . Auditors signature:

Date: 04/06/2014 Proposed corrective action / improvement action by company.

Timeline for conformance: next surveillance Review of corrective /improvement action:

Assessors signature:

Date:

RSPOPC-SUM-REPORT.F01 JULY2013 Page 35 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

NON CONFORMITY REPORT NC number: 05/2014 Client name: KLK Tuan Mee Complex Date raised: 04/06/2014 Major or Minor: Mino r Raised by: Mahaswaran Maliyapan Aspect of standard: Criterion: 5.2.3 - There shall be a programme to regularly educate the workforce about the status of these RTE species, and appropriate disciplinary measures shall be instigated in accordance with company rules and national law if any individual working for the company is found to capture, harm, collect or kill these species. Evidence of non-conformity: No evidence that such education programme regarding to status of RTE species was done for all units workforce. Auditors signature:

Date: 04/06/2014 Proposed corrective action / improvement action by company.

Timeline for conformance: next surveillance Review of corrective /improvement action:

Assessors signature:

Date:

RSPOPC-SUM-REPORT.F01 JULY2013 Page 36 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

NON CONFORMITY REPORT NC number: 06/2014 Client name: KLK Tuan Mee Complex Date raised: 04/06/2014 Major or Minor : Mino r Raised by: Mahaswaran Maliyapan Aspect of standard: Criterion: 5.6.3 - A monitoring system shall be in place, with regular reporting on progress for these significant pollutants and emissions from estate and mill operations, using appropriate tools. Evidence of non-conformity: Since there is no plans to reduce or minimize the GHG emissions therefore the monitoring system not auditable. Auditors signature:

Date: 04/06/2014 Proposed corrective action / improvement action by company.

Timeline for conformance: next surveillance Review of corrective /improvement action:

Assessors signature:

Date:

RSPOPC-SUM-REPORT.F01 JULY2013 Page 37 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

NON CONFORMITY REPORT NC number: 07/2014 Client name: KLK Tuan Mee Complex Date raised: 04/06/2014 Major or Minor: Mino r Raised by: Mahaswaran Maliyapan Aspect of standard: Criterion: 6.13.1 - A policy to respect human rights shall be documented and communicated to all levels of the workforce and operations. Evidence of non-conformity: In countries and communities where KLK operates, social issues are part of a broader set of complex socioeconomic and security concerns and being apply to many aspects of their business. The management of human rights issues in KLK is based on the totality of their efforts and not on a single activity. Their corporate policies, management processes, community investment programs and participation in voluntary initiatives are complementary and are intended to work together and reinforce their commitment to respecting human rights. However a policy to respect human rights not documented and communicated to all levels of the workforce and operations. Auditors signature:

Date: 04/06/2014 Proposed corrective action / improvement action by company.

Timeline for conformance: next survei llance Review of corrective /improvement action:

Assessors signature:

Date:

RSPOPC-SUM-REPORT.F01 JULY2013 Page 38 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

4.3.2 Non-Conformity Identified during the last ASA, not applicable for MA Non-Conformities Identified for previous audit.

NON CONFORMITY REPORT NC number: 01/2012 Client name: KLK Tuan Mee Complex Date raised: 24/10/2012 Major or Minor: Major Raised by: Simon Selvaraj Aspect of standard: Criterion: 5.2.1 Identification and assessment of HCV habitats and protected areas within landholdings; and attempt assessments of HCV habitats and protected areas surrounding landholdings. 5.2.2 Management plan for HCV habitats (including ERTs) and their conservation. Evidence of non-conformity: No such complete identification and assessment is present. The company did identify HCV informally and a SOP is in place, but this was not done with the involvement of stakeholders and according to the national interpretation of HCV as described in the company’s SOP. No clear maps are available on which management decision can be taken; demarcation in the field for cemeteries is not clear. No information on presence of ERT in the area. Evidence: SOP 11.0, 1-4-2012. Field visit 23-10-2012, interviews with Mr. Lee, Mr. K. Hairul and Mr. Siew. There are limited management plans and monitoring activities (not consulted with stakeholders). Also not clear whether there are ERT’s in the estate and whether the present HCV overview is complete Auditors signature:

Date: 24/10/12 Proposed corrective action / improvement action by company. The company will carry out the HCV habitats assessment by including stakeholder consultation process and involving knowledgeable person for this assessment.

Timeline for conformance: Since this is a main assessment, the time line agreed is 4 months, (120days). Review of corrective /improvement action: The assessment records shows people consulted, and research of potential HCV area within, monitoring record of HCV habitats. Final conclusion of the report was, there is no ERT present within the estate. The assessment carry out is evident and therefore this major non-compliance is closed . Assessors signature:

Date: 23/02/2013

RSPOPC-SUM-REPORT.F01 JULY2013 Page 39 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

NON CONFORMITY REPORT NC number: 02/2012 Client name: KLK Tuan Mee Complex Date raised: 24/10/2012 Major or Minor: Minor Raised by: Simon Selvaraj Aspect of standard: Criterion: 4.3.2 Avoid or minimize bare or exposed soil within estates. Evidence of non-conformity: Even though a full document of SOP of best practices are in place, during field visit, it is found that there are bare soils on terrace area which need further action to minimize the soil exposure. Auditors signature:

Date: 24/10/12 Proposed corrective action / improvement action by company. The planting of cover crops and stacking of fronds been included in the management plan.

Timeline for conformance: Will be verified during ASA 1. Review of corrective / improvement action: Sighted the soil erosion control measures at visited fields satisfactory and no evidence sighted on bare soil on terrace. Sighted the records for cover crop planting schedule and maintenance programmes. The assessment carry out is evident and therefore this minor non-compliance is closed . Assessors signature:

Date: 02/06/2014

RSPOPC-SUM-REPORT.F01 JULY2013 Page 40 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

NON CONFORMITY REPORT NC number: 03/2012 Client name: KLK Tuan Mee Complex Date raised: 24/10/2012 Major or Minor: Minor Raised by: Simon Selvaraj Aspect of standard: Criterion: 5.1.1 Documented impact assessment. Documented aspects and impacts risk assessment that is periodically reviewed and updated. Evidence of non-conformity: EIA and RA are in place for the mill. Date September 1 st 2012. All processes are described, but not all impacts are addressed, not all already implemented mitigating measures are mentioned and the reasoning behind the level of risk is unclear. Stakeholder consultation took place however not specifically for this item. During the stakeholder consultation by CUC no major issues were raised. For example: organic waste is not mentioned. Air pollution by boiler ashes not mentioned. Also not all mitigating measures are mentioned: oil trap in workshop, checking on exhaust gases produced by trucks. Not all training implemented yet.

EIA and RA in relation to the estates activities are present (Pollution prevention plans 2012). Periodically reviews mentioned in SOP 10.0. The SOP is not properly implemented: participation of stakeholders is not included, The EIA Document is limited in the description: Not all Impacts assessed or clearly mentioned. For example Soil pollution by non-organic solid, construction of landfill, erosion. Not all mitigating actions described: Spraying in the morning, not during the rain, erosion prevention. “Where” is not clearly marked in the impact assessment. Not clear where category “low, medium, high “ is based on? Stakeholder consultation took, place however not specifically for this item. During the stakeholder consultation by CUC no major issues were raised. Auditors signature:

Date: 24/10/12 Proposed corrective action / improvement action by company. The environmental assessment been reviewed and assured that all activities and process covers effectively in the EIA.

Timeline for conformance: Will be verified during ASA 1. Review of corrective / improvement action: Sighted the EIA document were updated on 27/09/14 from the initial assessment established on 01/04/2012. For 2014 assessment, water treatment plant added activity in the field. The assessment carry out is evident and therefore this minor non-compliance is closed . Assessors signature:

Date: 02/06/2014

RSPOPC-SUM-REPORT.F01 JULY2013 Page 41 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

NON CONFORMITY REPORT NC number: 04/2012 Client name: KLK Tuan Mee Complex Date raised: 24/10/2012 Major or Minor: Minor Raised by: Simon Selvaraj Aspect of standard: Criterion: 5.1.2 Environmental improvement plan to mitigate the negative impacts and promote the positive ones, is developed, implemented and monitored. Evidence of non-conformity: Implementation and monitoring is not fully in place for the mill. No monitoring of all wastes and mitigating measures. No environmental improvement plan available. According to the EIA of the estates there is negative impact left that needs to be managed and monitored. Mitigation measures implemented, however not complete and with limited description. For example not clear where the mitigation actions will be implemented. No environmental improvement plan is available. Auditors signature:

Date: 24/10/12 Proposed corrective action / improvement action by company. The environmental assessment been reviewed and assured that all activities and process covers effectively in the EIA.

Timeline for conformance: Will be verified during ASA 1. Review of corrective / improvement action: Sighted the EIA document were updated on 27/09/14 from the initial assessment established on 01/04/2012. For 2014 assessment, water treatment plant added activity in the field. The assessment carry out is evident and therefore this minor non-compliance is closed . Assessors signature:

Date: 02/06/2014

RSPOPC-SUM-REPORT.F01 JULY2013 Page 42 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

NON CONFORMITY REPORT NC number: 05/2012 Client name: KLK Tuan Mee Complex Date raised: 24/10/2012 Major or Minor: Minor Raised by: Simon Selvaraj Aspect of standard: Criterion: 5.3.1 Documented identification of all waste products and sources of pollution. Evidence of non-conformity: The mill combined this identification with the EIA. Not all types of waste are identified and monitored. No identification and monitoring of organic waste for example. The estates combined this identification with the EIA. Not all waste types are identified: For example waste water of households that does not go through the septic tank, organic waste from households, solid non organic waste that pollutes the soil, tree trunks after felling. During this assessment solid non-organic waste found in several places in the estates. Occupational health and Safety Manual KLK. GP/OSH13 is implemented.

Auditors signature:

Date: 24/10/12 Proposed corrective action / improvement action by company. The environmental assessment been reviewed and assured that all activities and process covers effectively in the EIA.

Timeline for conformance: Will be verified during ASA 1. Review of corrective / improvement action: Mill have document titled “Identification of All Waste Products and Operational Plan to Reduce Pollution” was well documented. The plan objective is to maximise recycling and minimise the pollution. List of waste is updated by annually basis.. The assessment carry out is evident and therefore this minor non-compliance is closed . Assessors signature:

Date: 02/06/2014

RSPOPC-SUM-REPORT.F01 JULY2013 Page 43 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

NON CONFORMITY REPORT NC number: 06/2012 Client name: KLK Tuan Mee Complex Date raised: 24/10/2012 Major or Minor: Minor Raised by: Simon Selvaraj Aspect of standard: Criterion: 5.3.2 Having identified wastes and pollutants, an operational plan should be developed and implemented, to avoid or reduce pollution. Evidence of non-conformity: No such complete operational plan present. Monitoring and training are partly present. Evaluation of the monitoring records is not in place. The place where POME leaves the estate is unclear. During the audit the exact location where the POME leaves the estate was not identified. The POME pond and drains are not well maintained. Monitoring is partly present (However no monitoring of amounts of waste in landfill for example). Domestic wastes and sanitary landfill checklist in place. Checked every month. Not completely clear how the company will reduce the pollution, including baseline data.

Auditors signature:

Date: 24/10/12 Proposed corrective action / improvement action by company. The environmental assessment been reviewed and assured that all activities and process covers effectively in the EIA.

Timeline for conformance: Will be verified during ASA 1. Review of corrective / improvement action: Waste water is treated using ponding system before discharging into cascaded pits for land application, monthly testing and monitoring of effluent samples and new installation of belt press to remove solid. POM generated recycle biomass that being sent to Tuan Mee for field mulching and land application. The assessment carry out is evident and therefore this minor non-compliance is closed . Assessors signature:

Date: 02/06/2014

RSPOPC-SUM-REPORT.F01 JULY2013 Page 44 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

NON CONFORMITY REPORT NC number: 07/2012 Client name: KLK Tuan Mee Complex Date raised: 24/10/2012 Major or Minor: Minor Raised by: Simon Selvaraj Aspect of standard: Criterion: 6.1 A documented social impact assessment and evidence that the assessment has been done with the participation of affected parties. Participation in this context means that affected parties are able to express their views through their own representative institutions during the identification of impacts, reviewing findings and plans for mitigation, and monitoring the success of implemented plans. Evidence of non-conformity: Non-restrictive format incorporating elements spelt out in this criterion were shown; however it was not done by a participatory way. Social Impact Assessment on Employee Changes; with reports of positive impact for employment, low for dismissal; however lacking supporting documents, data or analysis provided. Timetable of possible mitigation measure [negative nor positive] were not available.

Auditors signature:

Date: 24/10/12 Proposed corrective action / improvement action by company. The social impact assessment been reviewed and where applicable a new set of assessment been done.

Timeline for conformance: Will be verified during ASA 1. Review of corrective / improvement action: The SIA found to be acceptable with mitigation measures of negative / positive included and few new activities been assessed. The assessment carry out is evident and therefore this minor non-compliance is closed . Assessors signature:

Date: 02/06/2014

RSPOPC-SUM-REPORT.F01 JULY2013 Page 45 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

NON CONFORMITY REPORT NC number: 08/2012 Client name: KLK Tuan Mee Complex Date raised: 24/10/2012 Major or Minor: Minor Raised by: Simon Selvaraj Aspect of standard: Criterion: 6.2 There are open and transparent methods for communication and consultation between growers and/or mills, local communities and other affected or interested parties. Evidence of non-conformity: No Clear and transparent systems of consultation and communication with local stakeholders evident; No extensive lists of stakeholders are maintained with names and addresses; further no identified lines of communication. No records maintained for meetings with local community representatives and issues raised. The action taken in response to those issues is also not recorded. The company has identified and but not appointed a person who is the main point of contact and who is responsible for communicating with local communities and stakeholders.

Auditors signature:

Date: 24/10/12 Proposed corrective action / improvement action by company. A brief social impact assessment training conducted as to further enhance the awareness level and the documents required to fulfill this requirement.

Timeline for conformance: Will be verified during ASA 1. Review of corrective / improvement action: The stakeholder list been established with necessary informations made clear. Minutes of meetings seen effectively maintained by the Asst. Manager, Mr. Lam Weng Hong whom is the main correspondence person with stakeholders. The assessment carry out is evident and therefore this minor non-compliance is closed . Assessors signature:

Date: 02/06/2014

4.3.3 Observations Identified during this audit No observation found in this audit.

Client name: Date raised: Raised by: Aspect of standard: Observations:

Assessors Signature Date

RSPOPC-SUM-REPORT.F01 JULY2013 Page 46 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

4.4 Issues that were raised during the Stakeholder Consultation, if any Stakeholders were either informed by the client or by Control Union via the RSPO website. • For Main Assessments, a 30 day Stakeholder consultation announcement is published on the RSPO website prior to the audit. The same announcement is circulated by the client prior to the audit • For subsequent Annual Assessments, it is based on stakeholders reading the approved public summary reports available on the RSPO website, the client’s procedures in receiving on-going feedback or if feedback was sent directly to Control Union prior to an audit or thorough RSPO complaints procedures. During each assessment, the audit team will review the company’s implemented procedures in receiving feedback and will execute field visits and interviews. Not limited to the following questions, any feedback received is reviewed and summarized in this summary report for either Part 2 – Partial Certification or Part 4 – Assessment Findings above or noted below, if applicable: 1. Do you have any remarks on the RSPO standard? 2. What is your relation with the applicant? 3. Are there any plantation or mill management practices that affect you? 4. Do you consider any management is in conflict with the RSPO principles and criteria? 5. Do you have any suggestions for management? 6. Are you aware of any HCV in the plantations or in adjacent land? 7. Are you aware of any endangered or rare species? 8. Are there any adverse (or positive) effects on local communities? 9. Additional comments? 11. Do you have any comments about the assessment team and would you like to meet with them? 12. Do you have any comments for the client’s management of any other plantations? Subject raised Company response and Audit team findings proposed action to be taken refer to PART 2 and PART 4 refer to PART 2 and PART 4 refer to PART 2 and PART 4

PART 5: RSPO SUPPLY CHAIN CERTIFICATION The palm mill mentioned in the scope of the audit was audited against the requirements of the following: RSPO Supply Chain Certification Systems. November 2011 RSPO Supply Chain Certification Standard. November 2011

5.1 POM Included In The Scope Of The Audit Name Mill Location Supply Chain Model Palm Oil Mill Capacity (POM) MT/Hour Address (IP or SG or MB) Batu 24, Jalan Kuala Selangor, KLK Tuan POM 01 47000 Sungai Buloh, MB Mee POM Selangor,Malaysia

5.2 Confirmation Of The Company’s Summary Of Annual Certified Volume Of RSPO Certified Palm Oil And Palm Kernel Over A Specified Period Product CPO (MT) PK (MT) Specified 12 month period CU Code POM 1 14,026 3,341 May 2013 to April 2014. See also 1.6 above.

5.3 Summary Report Including A Brief Description Of The Scope Of Certification A full RSPO SCCS certification audit was used during this annual assessment and the findings support the certification based on supply chain model listed above.

RSPOPC-SUM-REPORT.F01 JULY2013 Page 47 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

5.4 Monthly Records of Certified and Uncertified FFB Received Since the Last Audit If this is the 1 st Main Assessment, the figures used are from the last 12 months. If this is an Annual Surveillance Assessment, the figures used are since the last audit. No MONTH-YEAR Certified Supply Bases (MT) Uncertified Supply Bases (MT), if any Total (MT) 1 May 2013 5113.32 4362.36 9475.68 2 June 2013 4233.82 1937.65 6171.47 3 July 2013 6449.17 2742.96 9192.13 4 Aug 2013 6094.89 2457.42 8552.31 5 Sept 2013 6604.47 2564.37 9168.84 6 Oct 2013 5789.75 1054.46 6844.21 7 Nov 2013 5875.14 1488.19 7363.33 8 Dec 2013 5845.15 1251.38 7096.53 9 Jan 2014 5367.05 1290.72 6657.77 10 Feb 2014 2765.68 701.36 3467.04 11 Mar 2014 6230.45 1932.74 8163.19 12 Apr 2014 5122.36 1242.11 6364.47 TOTAL 71,055.87 23,025.72 88,516.97

5.5 Monthly Records of Certified CPO and PK Produced Since the Last Audit If this is the 1 st Main Assessment, the figures used are from the last 12 months. If this is an Annual Surveillance Assessment, the figures used are since the last audit. No MONTH-YEAR Certified CPO (MT) Certified PK Total (MT) 1 May 2013 1098.341 237.769 1336.110 2 June 2013 870.050 206.610 1076.660 3 July 2013 1326.594 324.393 1650.987 4 Aug 2013 1300.650 301.697 1602.347 5 Sept 2013 1371.088 342.772 1713.860 6 Oct 2013 1283.009 291.224 1574.233 7 Nov 2013 1271.968 292.582 1564.550 8 Dec 2013 1284.179 295.180 1579.359 9 Jan 2014 1157.136 294.651 1451.787 10 Feb 2014 638.596 153.219 791.815 11 Mar 2014 1317.740 333.329 1651.069 12 Apr 2014 1107.454 268.412 1375.866 TOTAL 14 ,026.805 3,341.838 17 ,368.643

5.6 Records of Certified CPO & PK Sold under Green Palm to Buyers since the Last Audit, if Any If this is the 1 st Main Assessment, the figures used are from the last 12 months. If this is an Annual Surveillance Assessment, the figures used are since the last audit. The transactions were sighted form the clients registered Green Palm Account. Certified CPO Certified PK No Buyers Name Green Palm Trading No (MT) Sold (MT) Sold 1 - - -

5.7 Records of Certified CPO & PK Sold under UTZ eTrace to Buyers since the Last Audit, if Any If this is the 1 st Main Assessment, the figures used are from the last 12 months. If this is an Annual Surveillance Assessment, the figures used are since the last audit. The transactions were sighted form the clients registered UTZ eTrace Account. Certified CPO Certified PK No Buyers Name UTZ eTrace Trading No (MT) Sold (MT) Sold 1 KL-KEPONG (SABAH SDN. BHD.) ISCC 300.85 - 2 CARGILL MB TR58814b23-859e 599.92 -

RSPOPC-SUM-REPORT.F01 JULY2013 Page 48 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

3 “ TR-321e4lf4-3ec6 501.76 - 4 “ TR-5840e0ad-034f 501.88 - 5 “ TRb2dc69c3 -0896 386.96 - 6 “ TR-428b1d28-954d 616.74 -

5.8 Non-Conformities Identified during this Audit Timeline for compliance: 1. All non-conformances observed during an audit shall be classified as ‘major’ since all requirements for Supply Chain certification have to be met before granting certification. 2. For Main Assessments, all non-conformances shall be addressed satisfactorily by the operation before certification may be granted by the certification body. If non-conformances are not addressed within three (3) months of the audit, a full re-audit shall be required. The certification body shall assess the effectiveness of the corrective and/or preventive actions taken before closing out the non-conformances. 3. For Annual Surveillance Assessments, non-conformances raised after the certification are serious (i.e. must be considered as a major) and the integrity of the RSPO Supply Chain Certification is at risk. A maximum of one month is to be given to the certified client to satisfactorily address the non-conformance. The certification body shall assess the effectiveness of the corrective and/or or preventive actions taken. Should the nonconformance not be addressed within the one-month maximum timeframe, a suspension or withdrawal of the certificate and a full re-audit may be necessary. 4. If no non-conformances are observed at an audit or when the corrective action plan has satisfactorily addressed raised non-conformance(s), the client shall be recommended for (re-) certification. Non-were raised during this audit. NC Number: NA Date: Reference to standard: Standard requirement: Evidence of non -compliance:

5.9 Description of the Organizational Management Systems Including organizations, management and operational systems to ensure compliance with the RSPO Supply Chain Certification Systems and Standards as detailed above Rimmer palm oil mill and its supply base is Rimmer and Silabukan estate was audited against RSPO SCCS. The mill processing capacity is 60 ton FFB per hour with throughput of 38 to 48 ton. The mill is capable of handling SG supply chain model. However, downgrading to a lesser supply chain model is done by internal system where linking of both FFB purchasing and weigh bridge were carried out automatically.

RSPOPC-SUM-REPORT.F01 JULY2013 Page 49 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

5.10 Final Certification decision by Control Union for the RSPO SCCS Audit of the POM Recommendations made: Yes Summary of non- None Found compliances: Certification status of client: The POM included in the scope of this audit demonstrated full compliance with the RSPO SCCS.

With effect from the certification date given in the RSPOPC certificate, this POM mentioned in the scope of this report is considered to be certified in accordance with the RSPO SCCS.

PART 6: CERTIFIED ORGANISATION’S ACKNOWLEDGEMENT OF INTERNAL RESPONSIBILITY

6.1 Date of next ASA The provisional date for the next ASA is: April 2015

6.2 Date for Closure of Non-Conformities See sections above for details of NC’s, if any • All major NCs to be closed by: 60 days from the issuance date • All minor NCs to be closed b y: Before next surveillance audit

RSPOPC-SUM-REPORT.F01 JULY2013 Page 50 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

6.3 Signing by the Client I the undersigned, being the most senior relevant management representative of the operation seeking or holding certification, agree with the contents and audit findings as presented in this document .

I also confirm: • Acceptance of liability in execution of the instructions given. • That this company was made aware that the findings of the audit team are tentative; pending review and decision making by the duly designated representatives of Control Union Certifications. • That during the closing meeting all agenda items was covered by the Lead Auditor.

Acknowledged by: Name: Sin Chuan Eng Position: Head of Sustainability Date: 02/08/2014 Signature

6.4 Signing by the Lead Auditor I the undersigned, being the Lead Auditor, confirm that this report is an accurate record of the findings and of the closing meeting. I further confirm that the summary of the findings as presented in this report are a true representation of the actual findings of the audit team. Acknowledged by: Name: Mahaswaran Maliyapan Position: Lead Auditor

Date: 30/7/2014 Signature

6.5 Signing by the Certifier I the undersigned, being the Certifier, confirm that the information and conclusions included in this report have been prepared in good faith and that the certification decision has been based upon this information. Acknowledged by: Name: Gerben Stegeman Position: Certifier

Date: 02-09- 2014 Signature

RSPOPC-SUM-REPORT.F01 JULY2013 Page 51 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

PART 7: APPENDICIES

Map 1: Map showing the location of Tuan Mee Estate in Malaysia

Appendix 1: Location Map for this Certification Unit From 1.9, the location map(s)

RSPOPC-SUM-REPORT.F01 JULY2013 Page 52 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

Map 2: Map showing the location of the estates, POM and neighboring entities.

RSPOPC-SUM-REPORT.F01 JULY2013 Page 53 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700

RSPO Principles & Criteria Annual Surveillance Assessment Report Report Number CU822632

Appendix 2: List of Abbreviations BRC British Retail Consortium BOD Biochemical oxygen demand CHRA Chemical Health Risk Assessment CoC Chain of Custody COD Chemical oxygen demand CPO Crude Palm Oil CSR Corporate Social Responsibility CU Control Union CUC Control Union Certifications DOE Department of Environment DOSH Department of Safety and Health EFB Empty Fruit Bunch EIA Environment Impact Assessment ERT Endangered Rare or Threatened species EU European Union FFB Fresh Fruit Bunch FSC Forest Stewardship Council FSC COC Forest Stewardship Council Chain of Custody FSC FM Forest Stewardship Council Forest Management GGL Green Gold Label GMP Good Manufacturing Practice GOTS Global Organic Textile Standard GTP Good Trading Practice GPS Global Positioning System HACCP Hazard Analysis and Critical Control Point HIRARC Hazard Identification, Risk Assessment and Risk Control HCV High Conservation Value HCVF High Conservation Value Forest IPM Integrated Pest Management JAS Japanese Agricultural Standard LTI Lost Time Injury MDC MDC Publishers Sdn Bhd ( Company Name) MSDS Material Safety Data Sheet NC Non Conformity OE Organic Exchange OSH Occupational Safety and Health OSHAS Occupational Safety and Health Assessment Scheme P&C Principle and Criteria PEFC Programme for the Endorsement of Forest Certification PK Palm Kernel POME Palm Oil Mill Effluent PPE Personal Protective Equipment RSPO Roundtable on Sustainable Palm Oil RSPO NI Roundtable on Sustainable Palm Oil National Interpretation SA8000 Social Accountability 8000 Sdn Bhd Sendirian Berhad SIA Social Impact Assessment SOCSO Social Security Organization SOP Standard Operating Procedure USDA/NOP United States Department of Agriculture – National Organic Program MT Metric Tones WHO World Health Organization

RSPOPC-SUM-REPORT.F01 JULY2013 Page 54 of 54 Control Union (Malaysia) Sdn. Bhd. 150-A, 1st Floor, Persiaran Raja Muda Musa, Off Jalan Sg Bertih, Teluk Gadong, 41100, Klang, Selangor. Malaysia. Tel: +603-3377 1600 / 1700