SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES

RSPO Annual Surveillance 1 Assessment Report

PT. Brahma Binabakti – Brahma Binabakti Mill Jambi, Indonesia

This annual surveillance assessment report has been prepared in accordance with RSPO requirements and the information included is the result of a full RSPO assessment of the Mills and supply base as included in the scope of the certificate.

Prepared by: Nuzwardy Sjahwil (Lead Assessor)

PT. SUCOFINDO (Sucofindo International Certification Services – SICS) Graha Sucofindo B1 Floor, Jl. Raya Pasar Minggu Kav. 34, Jakarta 12780 Indonesia Contact Person: TutiSuryaniSirait Phone: (62-21) 7983666; Fax: (62-21) 7987015 Email:[email protected]

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List of Contents Page

A Scope of the Certification Assessment ...... 4

A.1. National Interpretation Used ...... 4

A.2. Assessment Type (Estate and Mill) ...... 4

A.3. Location Map ...... 4

A.3.1. Location Address of the Mill and Approximate Tonnages Certified

(CPO and PKO) ...... 5

A.4. Description of Supply Base ...... 5

A.4.1. General Description ...... 5

A.4.2. Location of Supply Base ...... 6

A.4.3. Statistic of Supply Base ...... 6

A.5. Organizational Information and Contact Person ...... 8

A.5.1 Audit Againstthe Rules for Partial Certification ...... 9

A.6 Date Certificate Issued and Scope of Certificate ...... 9

B. Assessment Process ...... 10

B.1. Certification Body ...... 10

B.2. Qualifications of the Assesment Team ...... 11

B.2.1. Qualifications of the Lead Assessor and Assessment Team ...... 11

B.3. Assesment Methodology ...... 12

B.3.1. General Overview ...... 12

B.4. Stakeholder Consultation ...... 15

B.4.1. Summary of How Stakeholder Consultation was Organized ...... 15

B.5. Date of Next Surveillance Visit ...... 17

C. Assessment Findings ...... 18

C.1. Lead Assessor’s Summary and Recommendation for Certification ...... 18 Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 2of 114

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C.2. Summary of the Findings by Criteria ...... 19

D. Certified Organization’s Acknowledgement of Internal Responsibility...... 74

D.1. Date of Next Surveillance Visit ...... 74

D.2. Formal Sign-Off the Assessment Findings ...... 74

D.3. Statement by the Certifier Body on Behalf of PT. Sucofindo SBU-SICS ...... 75

Appendix-1 List of Abbreviation ...... 76

Appendix-2 Map ...... 78

Appendix-3 NCR ...... 82

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A. Scope of the Certification Assessment

A. 1. National Interpretation Used

The management of the Palm Oil Mill(s) and associated suppliers of Fresh Fruit Bunches (FFB) were assessed for compliance against the RSPO Principle and Criteria 2013, RSPO Certification Systems 2007, and RSPO Suply Chain Certification Systems 2014. A. 2. Assessment Type (Estate and Mill)

Certification Unit : PT. Brahma Binabakti – Brahma Binabakti Mill located at Desa Bukit Baling, Kecamatan Sekernan, Kabupaten Batang Hari – Jambi, INDONESIA A.3. Location map

Please see Appendix-2 Map: 1. Map of Location, 2. Land area, 3. Topography and 4. HCV areas

Sumatera Island - Indonesia

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A. 3. 1. Location address of the mill and approximate tonnages certified (CPO and PK)

Annual Output Name of Location GPS No Actual (2015) Projected (2016) Mill Address Reference CPO PK CPO PK

1. PT. Brahma Desa Suko Awin Latitude: Binabakti Jaya, Kecamatan 01o20’52.81” S Sekernan, Longitude: 21,588 5,032 23,347 3,805 Kabupaten Muaro 103o19’3.20” E Jambi, Provinsi Jambi, Indonesia

A.4. Description of Supply Base

A. 4. 1. General description

PT. Brahma Binabakti operates 1 palm oil mill. The raw material/ FFB for PT. Brahma Binabakti - Brahma Binabakti Mill is supplied from the own estate i.e.: Brahma Binabakti Estate.The raw material/ FFB for PT. Brahma Binabakti - Brahma Binabakti Mill is also supplied from Plasma i.e.: 1. Plasma 1; 2. Plasma 2; 3. Plasma Pemayung and outside fresh fruit bunch 40 percent. All estates are operated under one management of PT. Brahma Binabakti. All estates located in Jambi, Indonesia. PT. Brahma Binabakti is a member of RSPO and they are implementing a Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 5of 114

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program to achieve RSPO Certified Palm Oil for all its production.

A. 4. 2. Location of the supply base

GPS No. Estate Name Location Latitude Longitude

Desa Bukit Baling,

Brahma Binabakti Kecamatan Sekernan, o o 1 Estate Kabupaten Muaro Jambi, 01 21’ 38,04” S 103 21’ 38,04” E Provinsi Jambi, Indonesia

Desa Bukit Baling, Kecamatan Sekernan, Plasma 1 o o 2 Kabupaten Muaro Jambi, 01 23’ 37,88” S 103 24’ 19,96” E Provinsi Jambi, Indonesia

Desa Bukit Baling, Kecamatan Sekernan, Plasma 2 o o 3 Kabupaten Muaro Jambi, 01 27’ 05,31” S 103 23’ 11,26” E Provinsi Jambi, Indonesia

Desa Teluk Ketapang, Kecamatan Pemayung, 4 Plasma Pemayung 01 o 28’ 30,33” S 103° 26’ 25.09” E Kabupaten Batang Hari, Provinsi Jambi, Indonesia

A.4.3 Statistic of supply base (2015)

Planting Age/Planting Planted No Estate Name FFB/Year CPO/Year Pk/Year Year Year Area

1994 21 1,006.45 22,356 5,086 1.185 1995 20 1,161.10 29,245 6,653 1.550

Brahma 1996 19 848.07 21,156 4,813 1.121 1 Binabakti 1997 18 185.11 4,601 1,047 243 1998 17 397.14 9,333 2,119 494 2005 10 35.78 676 154 36

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2006 9 279.21 3,286 743 174 2007 8 446.73 4,328 974 229 Total 4,359.59 94,982 21,588 5,032

1996 19 2,474.00 46,977 10,499 2,485 Plasma 1 1997 18 1,326.00 23,259 5,187 1,230 1998 17 478.00 10,248 2,208 541 Total 4,278.00 80,483 17,894 4,257

2006 9 850.00 14,867 3,196 786 Plasma 2 2007 8 996.00 14,811 3,273 783 2 Total 1,846.00 29,678 6,470 1,570

Plasma BBB 2010 5 57.42 258 54 14 Pemayung 2011 4 573.64 3,819 806 202 Total 631.06 4,076 860 216

Total Plasma 6,755.06 114,238 25,224 6,042

Out growers 160,465 30,167 8,473

Total - 160,465 30,167 8,472 Grand Total 369,684 76,979 19,546

ESTIMATED PRODUCTION 2016

Planting Age/Planti Planted Estimated Estimated Estimated No Estate Name Year ng Year Area FFB/Year CPO/Year PK/Year

1994 22 1,006,45 23,668 5,384 888

1995 21 1,161.10 29,578 6,729 1,109

1996 20 Brahma 848.07 22,228 5,035 834 1 Binabakti 1997 19 185.11 4,543 1,029 170

1998 18 397.14 9,815 2,213 344

2005 11 35.78 754 170 26

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2006 10 279.21 5,399 1,212 189

2007 9 446.73 7,016 1,575 246

Total 4,359.59 103,000 23,347 3,805

1996 20 2,474,00 40,738 9,060 1,528

Plasma 1 1997 19 1,326,00 21,793 4,827 817

1998 18 478.00 8,313 1,821 312

Total 4,278.00 70,844 15,708 2,657

2006 10 850,00 16.575 3.451 580 Plasma 2

2 2007 9 998,00 19.461 4.021 681

Total 1,848.00 36,036 7,472 1,261

2010 6 Plasma BBB 57.42 234 48 8 Pemayung 2011 5 573.64 3,417 706 120

Total 631.06 3,651 754 128

Total Plasma 6,757.06 110,531 23,934 4,046

3 Outgrower 281,090 53,407 9,838

Total 281,090 53,407 9,838 - 11,116.65 494,622 100,687 17,688 Grand Total

A.5. Organizational Information and Contact Person

1. Company Name PT. Brahma Binabakti

2. Personal Contact Tjandra Karya Hermanto

3. Vice Management Rudy Prasetya

4. Company Address Jl. Sultan Thaha no. 4 Pasar Jambi, kota Jambi 36113

5. Company Status PMDN

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6. Phone/Fax 021-57944939 / 021-57944745

7. E-mail [email protected]

8. Website www.tap-agri.com

9. RSPO Membership Number 1-0147-13-000-00

A.5.1. Audit Against the Rules for Partial Certification

The team found that PT Brahma Bina Bhakti has its own identity/number of RSPO member. Actually the company is under Triputra Agro Persada holding but the holding itselt has its own number of RSPO member. Information gathered from RSPO representative of Indonesia (RILO) stated the company with its own identity/member should be assessed within the company only for partial certification scheme; therefore the Audit against the rules for partial certification is not applicable to Triputra Group but still applicable tothesmallholders which suppliedFFB to the PT.BrahamBina Bhakti. There are Smallholders ie 1. Plasma 1; 2. Plasma 2; 3. Plasma Pemayung Company does not have a detailed plan related to the proposed Certification Plasma 1, 2 and 3. When assurance to the KUD, Information was obtained that socialization / training is merely the best practices and has not related to the preparatory activities of Plasma Certification. This has been issued as Minor Nonconformity. Conclusion : Minor NCR No. 31

A.6. Date Certificate Issued and Scope of Certificate

Name of Client PT Brahma Binabakti – Brahma Binabakti Mil

Client Number RSPO 00009

Certificate Number RSPO 00009

Certification Decision Date May, 26th 2015

Issued by PT SUCOFINDO, SBU SICS

Address Graha Sucofindo, SBU SICS. Jl Raya Pasar Minggu Kav 34 Jakarta 13640

Telephone /Fax Tel.: +62-21-7983666 / Fax.: +62-21-7987015

Email [email protected]

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Scope :

Mill Brahma Binabakti Mill

Estate Brahma Binabakti Estate

Projected mass balance CPO & PK CPO: 23,347 MT and PK : 3,805 MT

Certification Registration Code SICS-00003

Type of Certification Single site

Certifier Triyan Aidilfitri

Signed

B. Assessment Process

B. 1. Certification Body SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES (SUCOFINDO ICS), which was formed in 1994, is one of the strategic business unit that provides certification services for leading The Company.SucofindoCertification by International Certification Services is recognized nationally and international.Quality Management System Certification by SUCOFINDO ICS has obtained accreditation from National Accreditation Committee (KAN- Indonesia). Lead Auditors and Auditors of SUCOFINDO ICS are trained professionals in the field of international standards, auditing and management systems and are registered in the IRCA (International Register of Certified Auditors) and IEMA (Institute of Environmental Management & Assessment), UK. SUCOFINDO ICS certification process is supported by experts at PT. SUCOFINDO who understand the industry sectors and services in Indonesia. SUCOFINDO ICS Operational is supported by a network of branch and representative offices of PT. SUCOFINDO spread in 45 cities across Indonesia. The services provided by International Certification Services Sucofindo are:  Quality Management System Certification  Environmental Management System  ISO 22000 :2005  OHSAS 18000 Certification  Hazard Analytical Critical and Control Point (HACCP) Certification  Good Manufacturing Practice (GMP) Audit  Product Certification

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 Sustainable Forest Management Certification  Products Organic Food Certification  RSPO certification  ISPO Certification  Certification of Integrated Management System Certification (SMT)  Training

B. 2. Qualifications of the Assessment Team

B. 2. 1. Qualifications of the Lead Assessor and Assessment Team Nuzwardi Sjahwil (Lead Auditor) : He graduated from Institute Agriculture of Bogor (IPB). He has more than 5 years audit experiences in OSHAS and SMK3. He has successfully completion from Lead auditor for SMK3, Lead Auditor for OHSAS and Lead Auditor for ISO 9001. He has successfully completion training RSPO by Komisi RSPO, Jakarta, ISPO Lead Auditor Training by Komisi ISPO, Jakarta, and Supply Chain Training

Tuti Suryani Sirait (Auditor) : Graduated from Institute Agriculture in Bogor (IPB), 1991 She has more than 10 years audit experiences in auditing HACCP, GMP, ISO 9001:2008, ISO 22000:2005, ISPO and RSPO. She has successfully completion training RSPO by Komisi RSPO, Jakarta, SCC Standard Training by David Ogg & Partner – Jakarta, ISPO Lead Auditor Training by Komisi ISPO, Jakarta, Lead Auditor Training of ISO 9000/19011 organized by SICS – Sucofindo, ISO 22000 : 2005 FSMS Auditor / Lead Auditor by Moody International, Singapore; Lead Assessor for Food Safety Management System (HACCP&GMP) by QAS Sydney, Australia and Social Lead Auditor Training (SA 8000) from Social International Audit (SIA), Turkey. She is actively participated in RSPO meeting to discuss RSPO P & C and also as a trainer inISPO Lead auditor training.

Ronald E Butar-Butar (Auditor) S1 graduated from Catholic University Faculty of Agriculture. Work Experience (Best Practice Estates) in oil palm estates for 6 years. He has successfully completion Lead Auditor Training ISPO by Komisi ISPO. He has completion In House Training RSPO for 4 days.

Hidayat Pramudiyanto (Auditor): He graduated from University of Diponegoro, Semarang. He has the training AMDAL A at Universityy of Gadjah Mada Yogyakarta, April 1994, AMDAL B at University of Diponegoro, Semarang, October 1998, Monitoring of environment quality and

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waste, IRCA Environmental Management Systems Auditor / Lead Auditor Course

Puji Sulistiono (Observer): He was graduated from Bogor Agricultural University (IPB) majoring in Agricultural Engineering (bachelor) and Civil/Environmental Engineering (master). Experienced as research assistant in several agricultural development project and as engineer in several water infrastructure project. He was completed several training such as IRCA Reg. Lead Auditor Training for ISO 14001 and ISO 9001, Occupational Health and Safety Expert Training (AK3 Umum) from Ministry of Manpower - RI, Lead Auditor Training in Indonesian Sustainable Palm Oil (ISPO) from Komisi ISPO, Ministry of Agriculture - RI.

Noor Rakhmat Danumiharja (Technical Expert) He graduated from Academy of Forestry in Bandung in 1980 and Universitas Nusa Bangsa Faculty Of Forest Management in 1998. He worked in Ministry of Forestry from 1982 – 2013 with the latest position as Section Head of investigation. He has successfully completed training of Wildlife Conservation and Management Training Program, basic of environmental impact analysis, wildlife captivity, wildlife conservation management, Lead Auditor Training by Komisi ISPO, Jakarta.

B.3. Assessment Methodology

B. 3. 1. General Overview The assessment was carryingout in conformity with the SBU SICS RSPO manual and procedures for auditor and certifier. The assessment was conducted by qualified auditors and referred to RSPO standard. Partial certification audit conducted during compliance audit to check compliance with Final RSPO Certification System for partial certification. The opening and closing meeting audit was conducted at the office of estate and then continues in Mill’s and estate’s offices. Stakeholders meeting was conducted once, during compliance audit.

SurveillanceAudit Number of assessor participating: 4 auditors Number of days spent for the assessment on site: 5 days Total number of mandays used for the assessment on site: 20 days

Date/Time Functions / areas / Department / activities to be audited Auditor(s) (include related requirements) 29 Feb 2016 Day 1st (Monday) Trip form Jakarta to Jambi Team 11.05-13.30

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13:30-16:00 Trip from Jambi to sites Team 16.00-17.00 Opening Meeting All 17.00 End of audit day 2 01 Maret Day 2nd (Tuesday) 2016 08:00 Document audit  Check completeness of previous NCR minor and TSS observation  Partial Certification TSS  Land dispute and conflict (2.2.3, 2.2.4, 2.2.5, 2.2.6)  Compensation to legal and customary right (6.4)  FPIC (2.3)  NPP (7) Worker welfare  Check completeness of previous NCR minor and observation  Worker welfare (6.5) NS  Water for worker (4.4.1)  Anti discrimination (6.8)  Child labour (6.7) Complaint handling 6.3  Legality regarding land (2.2.1, 2.2.2)& 1.2.1 regarding land RB title  Best practice at estate (4.1)  Erosion control and peat (4.3)  Pest management (4.5) Pesticide (4.6.1 – 4.6.4)  Check completeness of previous NCR minor and TSS/NR observation  NKT/HCV (5.2) and 1.2.1 regarding HCV Protection of water courses and wetlands (4.4.2)  Environmental impact assessment (5.1) and 1.2.1 HDY regarding EIA  POME for land application (4.4.3) Waste management (5.3) 12.00-14.00 Break 14:00-17.00  Business plan (3.1) NS  Social responsibility (6.1.1 –6.1.4) TSS

Development of local businesses (6.11) TSS/NR  Occupational health and safety and legal requirement HDY

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regarding heath and safety ( 4.7)  Safety in pesticide (4.6.5 – 4.6.12) GHG mitigation (5.6)  Schemed Smallholder (6.1.5) TSS  FFB reception from small holder and local business (6.10)  Practices maintain soil fertility (4.2) RB Water management at estate (4.4.1) 17.00 End of audit day 2 02 Maret Day 3rd (Wednesday]) 2016 07:30 Visit estate Visit to harvesting, spraying and manuring NS/RB Visit to HCV location TSS/NR Visit to housing facility, warehouses, bathing facility, day care NS/RB Visit to BPN Pole RB/NS Visit to land application HDY 09:30 Visit to mill HDY/RB  POME (4.4.3) HDY 12:00-14.00 Break 14:00 Visit Mill  SCCS RSPO NS  Best practice mill (4.1)  FFB reception from small holder and local business (6.10) TSS  Worker welfare (6.5)  Occupational health and safety and legal requirement HDY regarding heath and safety ( 4.7)  Renewable energy (5.4) HDY  Water management at mill (4.4.1)  Water efficiency at mill (4.4.4) At Estate Continue audit on pending agenda ALL 03 Maret Day 4th (Thursday) 2016 08:00  Stakeholder consultation NS/NR  Trade Union (6.6) NS  Continous improvement (8.1) NS  Use of fire for preparing land or replanting (5.5) RB  Training 4.8 TSS  Sexual harassment (6.9) 10:00  Compliance to regulation (2.1) NS  Information provision (1.1, 1.2) TSS

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 Consultation and communication 6.2, 12:00-14.00 Break 14:00  Ethical conduct (1.3) NS  Forced labour (6.12)  Human right (6.13) 17:00 End of audit day 4 04 Maret Day 5 (Friday) 2016 08:00 RSPO reporting ISPO reporting 11:30 Break 15:00 Closing meeting

B. 4. Stakeholder Consultation B. 4. 1. Summary of How Stakeholder Consultation was Organized

Stakeholders Consultation and Company Responses

Issue Company Responses Assessor Findings

Chairman of KUD (Cooperative of smallholder)  Member of cooperative send FFB every 2 . Conform weeks to the company mill.  The price of the FFB was according to price determined by Local Plantation Authority  The company takes 5% of the harvest as management fee. This management fee has been taken from the cooperative from the harvest of Juni 2014 – Mei 2015  Company has verified data of the plasma participant.  Land was owned by the cooperative members based on sporadik letter. The cooperative members who want to join the plasma has to cede 40% of their land to the company while still retain the rest of 60%. Therefore the company did not pay any compensation for the land acquired from the cooperative members. The allotment 40% of their land to the Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 15of 114

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company, had nothing to do with the development of their plantation. The cooperative member still have to pay to company the cost of plantation development by installment. Currenty from 630 ha land of the cooperative members, has been allocated217 hato the company.  The land documents was kept by company  The plantation of the cooperative members was previously rubber plantation or abandoned ones. All the land of the plasma (and 40% for company) was located in one overlay i.e Sub district Pemayung.  The soil of the cooperative members land consist of dry mineral land and mineral marshes. The contour of the land is dominated by flat land and moderate slopy hill.  Inside the land of 630 ha there is river namely Sungai Dano Bangko, with width 10 meters and its water runs the whole year regardless the seasons  30 meters of the left and right side of the river banks was left unplanted. In this riparian zone there were tree of cempedak and mahang  The fauna ever found the location of the plantation were tiger, bear, langur, monkey, and wild chicken.  The cooperative held general members meeting once a year in Desember. General Comment

 SOP socialization handling of the conflict Conform has been conducted well

 Pollution of water, and air : no communities complain

 The road towards the mill has been watered appropriately

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community such as kompangan. Beside that scholarships for education is available.

 The well drilling is indispensable for public locations that lack of water in the dry season.

 The health sector is the Company conducted free medical treatment, it is expected that Company make a wider coverage of medical treatment area.

 Prioritazion to the community around estate have been met through the recruitment of unskilled labor. For the needs of skilled labor has been submitted to Jambi university and company has given priority

 Conflicts over land : Nothing

 Child labor: there is no report on the matter.

 Lodgement for example the aid proposal, The Company usually gives a direct response.

Chairman of Union

Conform The company has showed the commitment to support the union. The company has provided office for the union, to socialize collective labor agreement, assisted the registration of the union. The company and union has formed communication and consultation forum (LKS bipartite.

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B. 5. Date of Nexts Surveillance Visit One (1) year after date of 2016 surveillance audit C. Assessment Findings

C. 1. Lead Assessor’s Summary and Recommendation for Certification

The Surveillance audit has been carried out through field visit to mill and estate using RSPO principle and criteria 2013 and RSPO Supply Chain Certification Standard 2014

Audit Team has published the nonconformities, comprising 7 majors, 9 minors and 19 observations. The company has made the corrective actions to the respectives nonconformities graded as majors, minors and observations. All of the major findings have been closed or downgraded to observation.

During this surveillance the team found the new data that the company has opened new estate in 2010 within the company’s entity. The team issued a major non conformity as the company has no applied HCV and NPP process for this area (Pemayung estate). The Company agree to follow the NPP process and the area will be excluded from the certified scope.

The final conclusion regarding all of the nonconformities are 8 minors, 26 observations and 1 Major NCR No. 29 will be followed with NPP verification process. The team will see the evidence of implementation on the next surveillance audit.

Since there are no major non conformities unsettled, the audit team found that PT. Brahma Binabakti mill and its estates is still complying against RSPO P&C 2013 and RSPO SCCS 2014. Therefore, certification can be continued to PT. Brahma Binabakti (Mill and supply bases).

November 2016

Nuzwardy Sjahwil

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C. 2 Assessment Findings

C.2.1 Summary of Findings

1 COMMITMENT TO TRANSPARENCY

1.1 Oil palm growers and millers provide adequate information to other stakeholders on environmental, social and legal issues relevant to RSPO Criteria, in appropriate languages & forms to allow for effective participation in decision making.

1.1.1 Evidence should be provided that information is received in appropriate form(s) and language(s) by relevant stakeholders. Information will include Minor information on the RSPO mechanisms for stakeholder involvement, including information on their rights and responsibilities.

Company already has Receiving and Handling of Information Request Procedure (106181/TAP/PRO–CSR–HO/VI/13 Revision: 01). The company has a listed of stakeholders and the latest version is signed on February 15, 2016. The Company already has document in the form of socialization minutes of request and external complaint. This minutes has been signed on February, 25th 2015 and completed with attendance list & photo. Related with the provision of information to stakeholders, the relevant SOP and assurance in the field has not been stated: a. Frequency stakeholders updated list. b. There has been no appointment letter from the company to the personnel responsible for providing information c. There has been no determination of the type / level of information provided to stakeholders. d. There has been no SOP governing the dissemination / sharing of such information. Conclusion : Minor No. 22

1.1.2 Records of requests for information and responses shall be maintained.

Major

In SOP point 4.5, stated that provision of information approved is given within a maximum of 5 (five) working days. The type of information that is not approved will be given an answer within a maximum of 2 (two) working days. In points 4.8.4 declared any incoming mail required a response within 14 working days. This is contrary to point 4.5 which is stated 5 working days. This has been issued as an observation. The Company already has document such as form no. 106 181 / TAP / PRO-CSR-HO / VI / 13 "Information request record or External Grievance. During 2016, from January to February there

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were five records were filled in the formulir. Formulirs were only filled for verbal request. Request in writing and outgoing mail has been recorded in the book of incoming & outgoing mail and recorded separately in the POM and estates. Sampling of the incoming letter dated June, 6th2015 related to the request for used zink mill by Head of RT 15, Suko Awin Jaya Village. The mail was replied on June 13th, 2015, whis is stated that the request was granted by letter No. BBB / SKR-MILL-SM / VI / 2015 signed by Mill Manager (Br. Yopie Risnandar). Hardcopy of incoming and outgoing mail was saved and can be traced. Complaint mechanism was stipulated in SOP of Complaint and every incoming complaint was registered in the form of Grievance Stakeholder. Conclusion : Observation No.23

Management documents are publicly available except where this is prevented 1.2 by commercial confidentiality or where disclosure of information would result in negative environmental or social outcomes

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);

Major  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).

HGU Decree 1. The Company has a BPN letter/Agraria Minister Decree no. 61 / HGU / BPN / 95 covering an area of 6.220 HA dated October 2, 1995. In the letter BPN define that PT Brahma Binabakti domiciled in Jambi and located in Kelompok Hutan S. Hulumendahara-S. Kaos, Batanghari Regency, Jambi Province. HGU Certificate 1. HGU Certificate No. 2 located in Baling Hill Village, District of Sekeran, Batang Hari Regency, Jambi Province. Based on measurement letter No. 1814/1996 dated May 1, 1996 Company

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had HGU covering an area of 28.200.000 m2 2. HGU Certificate No. 3 located in Baling Hill Village, District of Sekeran, Batang Hari Regency, Jambi Province. Based on measurement letter No. 1815/1996 dated May 1, 1996 Company had HGU covering an area of 34.000.000 m2 3. Concession area No. 3 revised on November 20, 1998. The area of the concession into 33,902,275 m2 due to 97 725 m2 was bought by PGN. The company has shown HCV study. The Study held in May 7-12, 2013. The study was led by Lead Assessor Mr. Ahmad Faisal Siregar, S.Hut, M.Si, Mr. Sutopo, S.Hut, and Mr. Samsul Rijal, S.Hut. The HCV Studies have reviewed by Dr. Ir. Nyoto Santoso, M.Si from the Faculty of Forestry, IPB. List of information that can be accessed in public (SOP No. 106 181 / TAP / PRO-CSR-HO / VI / 13) has not complete yet as required under RSPO standards such as the concession, Complaints & Grivience Procedure, Negotiation Procedure, Continues improvement, Public Summary of the Certification audit report, and Human Rights Policy.

Company do not have a website so the stakeholders can not have access to information related to PT. BBB. The Company has not disseminate type of relevantinformation and can be accessed by all relevant partiesto the stakeholders. These non conformities have been issued as observation. Conclusion : Observation No.24

1.3 Grower and millers commit to ethical conduct in all business operation and transaction

1.3.1 There shall be a written policy committing to a code of ethical conduct and

Minor integrity in all operations and transactions, which shall be documented and communicated to all levels of the workforce and operations.

The Company already has a Business Ethics Policy. Policy are listed on the instruction no. 004 / K-DIR / II / 2013 date February, 22. Conclusion: conform

2 COMPLIANCE WITH APPLICABLE LAWS AND REGULATIONS

2.1 There is compliance with all applicable local, national and ratified international laws and regulations.

2.1.1 Evidence of compliance with relevant legal requirements shall be available.

Major

The Company has been reporting regularly to the relevant institutions, such as RKL RPL implementation report, the balance sheet Hazardous waste to BLH Muaro Jambi, Jambi

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Regency and KLH.The Company need to add regulations of governor Jambi Province no. 20 of 2007 into the list of compliance regulations. The Company has permit retrieval of the river water that is not valid. Currently the company is working on the arrangements of license renewal decision of Sekawan river based on the receipt document dated March 11, 2015 from Sumatra BWS VI. This has been issued as Observation No. 3 There are plants in the Forest Area locations that have been planted with an area of 785 Ha (Decree of Minister Forestry no. 727, 2012). This is not in accordance with Government Regulation Number 104 of 2015. This has been issued as Major Non Conformity. During follow-up audit, the auditor verifies the corrective actions by the company. Ministry of Forestry and Environmental issued Letter No. No. SK 727 / Menhut-II / 2012 explained that 785 ha are as forest area. PT. Brahma Binabakti sent a letter with Number 118875 / BBB / SKR-R01 / II / 16 on February 25, 2016 explained that area was an area of other use (APL) based on RTRWP Jambi 1993. In that letter also requested that the company's total forest area of 785 ha on the SK 727 / Menhut-II / 2012 should be amended accordance with RTRWP Jambi in 1993, which is area of other use (APL). The letter has been received by the Ministry of Environment and Forests with a receipt, stamp and signature on the copy of the letter. Progress will be seen in the next surveillance audit. This has been issued as observation. Conclusion: Observation No.2, Major No.32

2.1.2 A documented system, which includes written information on legal

Minor requirements, shall be maintained.

The Company has set a periodic evaluation to meet regulatory and written in the TAP/SOP/120 – SHE / 001 BAB III (Legal and Other Requirements). SPO Officer recapitulate compliance regulations in each unit, which includes in the area of legality, agronomy, best practices mill, employment, SMK3, and the environment. Conclusion: Conform

2.1.3 A mechanism for ensuring compliance shall be implemented.

Minor

SHE Sustainability Officer PT. Brahma Binabakti recapitulate and evaluate compliance regulations in each unit estate and mill. Evidence of the last evaluation regulations such as minister regulation of PU and Perumahan Rakyat no 37 / PRT / M / 2015 regarding the use of water and / or water sources, dated July 24, 2015. The Company has not evaluated the compliance with laws and regulations regularly. By sampling, it was found that compliance with Ministry of Public Work and Public Housing RegulationNo. 37 / PRT / M / 2015 on approval of use of water and / or water sources, dated July 24, 2015 has not been evaluated.

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Conclusion: Minor No.1

2.1.4 A system for tracking any changes in the law shall be implemented.

Minor

The Company has established TAP/SOP/120 – SHE / 001 BAB III which regulate the mechanism of updating the latest regulations relating to the Company's activities. Conclusion: Conform

2.2 The right to use the land is demonstrated, and is not legitimately contested by local people who can demonstrate that they have legal, customary or user rights

2.2.1 Documents showing legal ownership or lease, history of land tenure and the actual legal use of the land shall be available. Major

Location Permits PT Brahma Binabakti has location permits ie: 1. The Company had estate location permits based on the Decree Governor of the Jambi Province No. 101/ 1990 dated March 31, 1990 regarding reserve land for the Rubber Plantation PT BBB. Estate is located in location A Hulumendahara river and location B Kaos River in Sekernan district, Batang Hari regency with an area of ± 6.500 Ha. Location permits explained that the reserve land covering an area 6.500 Ha for rubber plantation PT Brahma Binabakti was divided to each location.Location A (Sungai Hulumendahara covering an area 3500 Ha located approximately KM 45-KM 60 right the way Jambi-Merlung and Area B (River Kaos) covering an area 3000 Ha located around Km 42-KM 60 in left the road Jambi - Merlung in Sekernan district, Batang Hari regency. 2. The Company had letter decree of Muaro Jambi regency with No. 529/ 2011 concerning amendments to the decision of Muaro Jambi regency No. 24/2011 concerning location permit for development of Palm Oil Estate PT Brahma Binabakti (Smallholder I) in Suko Awin Jaya village, Tanjung Lanjut village, Sekernan district, Muaro Jambi covering an area 6.830 Ha 3. The Company had letter decree of Muaro Jambi regenct with No. 25/ 2011 concerning location permit development of Palm Oil Estate PT Brahma Binabakti (Smallholder II) in Suak Putat village, Tanjung Lanjut village, Bukit Baling village, Gurunggung village, Sekernan district, Muaro Jambi covering an area 5.350 Ha 4. The Company had mill location permits based on Decree Letter Head of the Land Office Batang Hari No. 4/1997 dated March 17, 1997 covering an area ± 50 Ha located in Bukit Baling village, Sekeran district, Batang Hari Regency. 5. Company also had location permits from Head of Badan Pelayanan Terpadu Satu Pintu

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Batang Hari Regencywith No. 08/2011 regarding location permit for development plan of Palm Oil Estate PT. Brahma Binabakti in Pemayung district, Batang Hari regency, Province Jambi covering an area 6.400 Ha 6. There is decree Head of Badan Penanaman Modal dan Pelayanan Perizinan Terpadu Batang Hari Regency No. 66/2014 concerning the extension of the location permit for the development plan of oil palm estate PT Brahma Binabakti In Pemayung district, Jambi Province, Batang Hari covering an area of 6000 Ha. Plantation Business Permit (IUP) Related Document of Plantation Business Permit (IUP) ie : 1. Decree of Minister Agriculture No: HK.350 / E4.379 / 04.90 dated April, 18 1990 concerning the approval of business principles rubber plantation covering an area 6.000 ha in Sekernan district, Batang Hari regency, Jambi province. This permit set a net area about 6.000 ha from land reserve covering an area 6.500 ha brutto commodities rubber. 2. Letter of Approval of Change Type Plant PT. Brahma Binabakti, Jambi Province of the Directorate General Plantation - Department of Agriculture Number: HK.350 / E5.363 / 05.96 dated May 28, 1996. The change of Commodity rubber with an area of 6.000 ha to the type of commodity rubber and oil palm plantations with a total area of 6.000 hectares (Rubber with an area of 3000 ha and 3.000 ha of oil palm) on an concession area about 6.220 Ha. 3. PT Brahma Bina Bakti already have Plantation Business Registration License (SPUP) from the Directorate General of Plantation Production Number: HK.350 / 425 / Dj.Bun.5 / VI / 2001 dated June 6, 2001. This SPUP set business a rubber plantation culture with plantation area of 6.220 Ha and processing unit type Latek Pekat with a capacity 3.500 tons / year. 4. Decree of the Head of the Investment Coordinating Board (Badan Koordinasi Penanaman Modal) No. 2/1 / IU / IV / domestic / Agriculture / Industry / 2010 dated May 20th, 2010 concerning business licenses in the framework of the Merger (Merger). The business sectors were rubber and palm oil plantation integrated with the palm oil industry and palm kernel. The capacity license for FFB production was 67 800 tonnes / year, latex rubber plantation was 3,500 tons / year, crude palm oil (CPO) was 60,000 tons / year, and palm kernel was 12,720 tons / year. The land area was listed in the permit was 2,820.00 ha for palmoil plantation and 3390.00 hectares for rubber plantation and 726.00 m2 for the industry. If the license has been stated that the shortage of FFB as many as 193,200 tonnes (equivalent to 8,050 hectares) was supplied from around smallholder, the company could carry out product diversification within the scope of the edible oil industry (crude oil) and vegetable. 5. PT. Brahma Bina Bakti applied for changes in types of plant and processing on SPUP No. HK.350/425/Dj.Bun.5/VI/2001 through a letter no. 105492/BBB/SPM-R01-HO/IX/13, dated September, 2nd 2013. 6. Forestry and Plantation Letter No. 525/1193 / Dishutbun / 2013, dated September, 24th 2013 approved the recommendation of Plantation Business Permit (IUP) covering an area of 3,661 hectares of oil palm and its management with a capacity of 60 tons / hour and Aquaculture

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Plantation Business Permit (IUP- B) of rubber covering 2,559 hectares located in the village of Suko Awin District of Sekernan, Muaro Jambi. 7. The Company has processed the changes in plant type and processing on SPUP no. HK.350/425/Dj.Bun.5/VI/2001 and obtained the letter from One-Door Integrated Service Agency (Badan Pelayanan Terpadu Satu Pintu) no. 503/213/BPTSP/XI/2013 dated November, 15th2013. The letter explained that the issuance of changes in plant type and processing of the license was still in process in the Agency One Stop Muaro Jambi. 8. The Company has obtained the Letter of Approval of Changes in Plant Type and processing of the SPUP (Plantation Business Registration Letter) No. HK.350/425/Dj.Bun.5/VI/2001 PT. Brahma Binabakti from One-Door Integrated Service Agency (Badan Pelayanan Terpadu Satu Pintu) of Muaro Jambi Regency number: 503/01/BPTSP/2013 dated 20 November 2013 from originally Rubber commodity and Latex Processing into rubber and palm oil commodities along with oil palm processing with a 60 tonnes/hour capacity with a total area of rubber plants of 2,559 Ha and oil palm of 3,661 Ha. 9. The Company has obtained Decree Letter from Regent of Batang Hari no. 640 year 2013 on granting permission of plantation business permit for cultivation (IUP-B to PT Brahma Binabakti with area of 3,500 hectares in the Pemayung district.

HGU Decree : 1. Decree of the State Minister of Agrarian/ Head of National Land Agency Number: 61/HGU/BPN/95dated of 2 October 1995 concerning the granting of Exploitation Right for 25 years (up to 31 December 2020) to PT. Brahma Binabakti of 6,220 Ha of land located in forest group of S. Hulumendahara-S. Kaos, Batanghari Regency, Jambi Province. 2. Decree of the Head of the Regional Office of National Land Agency of Jambi Province Number: 07/HGU/BPN.15/2014 concerning the granting of Exploitation Right for 35 years to PT. Brahma Binabakti of 453.3 Ha 3. Decree of the Head of the Regional Office of National Land Agency (Badan Pertanahan Nasional)of Jambi Province Number: 08/HGU/BPN.15/2014 concerning the granting of Exploitation Right PT. Brahma Binabakti of563.783 Ha, located in Muaro Jambi Regency, Jambi Province. HGU Certificate: 1. HGU Certificate No. 2 with location in Bukit Baling Village, Sekeran District, Batang Hari Regency, Jambi Province. The area covered is based on the letter of measurement No. 1814/ 1996 dated 1 May 1996 of 28,200,000 m2 2. HGU Certificate No. 3 with location inBukit Baling Village, Sekeran District, Batang Hari Regency, Jambi Province. The area covered is based on the letter of measurement No. 1815/ 1996 dated 1 May 1996 of 34,000,000m2. 3. Revision of HGU certificate No. 3 on 20 November 1998 to become 33,902,275 m2 due to the

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purchase of 97,725 m2 by PGN. 4. HGU Certificate no. 94 – 108 that is issued by National Land Agency (Badan Pertanahan Nasional)of Muaro Jambi Regency in 2014 with total area of 453.3 Ha in accordance with Decree Letter no. 07/HGU/BPN.15/2014. 5. HGU Certificate no. 77 – 93 that is issued by National Land Agency (Badan Pertanahan Nasional) of Muaro Jambi Regency in 2014 with total area of 563.783 Ha in accordance with Decree Letter no. 08/HGU/BPN.15/2014. HGU Certificate 1. HGU Certificate No. 2 located in Baling Hill Village, District of Sekeran, Batang Hari Regency, Jambi Province. Based on measurement letter No. 1814/1996 dated May 1, 1996 Company had HGU covering an area of 28.200.000 m2 2. HGU Certificate No. 3 located in Baling Hill Village, District of Sekeran, Batang Hari Regency, Jambi Province. Based on measurement letter No. 1815/1996 dated May 1, 1996 Company had HGU covering an area of 34.000.000 m2 3. Concession area No. 3 revised on November 20, 1998. The area of the concession into 33,902,275 m2 due to 97 725 m2 bought by PGN. 4. There is HGU certificate No. 94 s / d 108 issued by BPN Muaro Jambi in 2014 with a total area of 453.3 ha in accordance with decree letter No. 07 / HGU / BPN.15 / 2014. 5. There is a certificate of HGU No. 77 s / d 93 issued by the National Land Agency (BPN) Muaro Jambi in 2014 with a total area of 563.783 ha in accordance with Decree letter No. 08 / HGU / BPN.15 / 2014. The Company has not had the concession for an area (HGU) covering an area 73999.17 ha (planted area = 641.48 and 97.69 LC) located in Cipayung District. This is not in accordance with Goverment Regulation no. 40 1996

SK HGB: Decision of the Head of National Land Agency (Badan Prtanahaan Nasional)No: 34 / HGB / BPN / 2000 dated May 29th, 2000 providedHak Guna Bangunan to PT. Kirana Sekernan for 30 years with an area of 492,280 m2 located in the village of Bukit Baling, District of Sekernan, Regency of Batanghari, Province of Jambi, whis is described in measurement certificate dated September 23rd, 1999 No. 05 / BKB / 1999. HGB Certificate HGB certificate no. 2, located in Bukit Baling Village, Sakernan District, Batanghari Regency, and Jambi Province with an area of 49,228 ha, which is ended on October, 9th 2030. The company has had a Standing Instruction No.027 / MI-DIR / XII / 2012, which contains instructions on how to manufacture and maintenance concession boundary markers such as the size of the mark, the type and color of paint, as well as the identity of the article reporting deadline. However,maintenance and monitoring reporting of the concession boundary markers

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should be reported every month before the 7th of each month was not appropriate. The last reporting was reported once in the last 3 months i.e from July to September 2013. The Company has reported the maintenance and monitoring of the concession boundary marker in accordance with a standing instruction. Release of forest area The company had permit letter regarding the release of forest area through Decree of Minister Forestry No. 125 / Kpt-II / 1993 dated February 27, 1993. Letter explained the release of some forest group S. Hulumendahara - S. Kaos located in Batang Hari regency, Jambi covering an area of 6.220 (Six Thousand and Two Hundred Twenty) ha for the cultivation of rubber plantations with the name of PT.Brahma Binabakti. The Company has not had the concession for an area of 6000 hectares (planted area = 641.44 ha and 97.69 ha LC) located in District Pemayung. Currently The location permit(No. 66 of 2014) and the Business License Plantation-Cultivation (Number 640 of 2013) is on process. This has been issued as observation. There were areas of plasma that has been planted inside the concession with an area of 189 Ha. This was not in accordance with Government Regulation No. 40 of 1996. It was not clear where the land was located because the company has not been able to show a location map (mlock) and its range. This has been issued as Major Non Conformity. At the time of follow-up audit, the Company has provided a location map of the plasma area covering 189 ha. Smallholder is located in the village of Bukit Baling, District Sekernan, Batang district included into the concession area No. 2 and 3. The company states that in 2017 will propose a reduction in the concession area which is plasma at the time of filing the extension of the concession. This has been issued as observation. Conclusion: Major No.33, Observation No. 34

2.2.2 Legal boundaries shall be clearly demarcated and visibly maintained.

Minor

Company has SI (Standing Instruction) No. 027 / MI-DIR / XII / 2012. The company already has a list of inventory coordinates HGU as much as 90 pegs. The company also has SOP for Monitoring pegs BPN. Monitoring is conducted every three months. The SOP aims to ensure that the boundaries of company tracked and monitored properly, so that the actions required for maintenance can be determined appropriately. Company has conducted maintenance of peg HGU in the period January 2016 to the peg KP61 (coordinates X = 318 417, Y = 9,849,869) and peg KP 54 (coordinates X = 316 626, Y = 9,851,223). During of field visits in peg HGU No. KP 85, the peg visible in good condition and maintained (X = 313 201 and Y = 9,849,142). Conclusion: conform

2.2.3 Where there are or have been disputes, additional proof of legal acquisition of title and evidence that fair compensation has been made to previous Minor owners and occupants shall be available, and that these have been

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accepted with free, prior and informed consent (FPIC).

Based on information from the company there is no land conflicts since 2013. Conclusion: conform

2.2.4 There shall be an absence of significant land conflict, unless requirements for acceptable conflict resolution processes (see Criteria 6.3 and 6.4) are Major implemented and accepted by the parties involved.

Based on information from the company there is no land conflicts since 2013.SOP of Stakeholder Complaint Receiving and Resolution (No. 106899/TAP/PRO-CSR-HO/VI/13) scope includes: complaints from stakeholders, complaints on contracts, and land dispute resolution. Conclusion: conform

2.2.5 For any conflict or dispute over the land, the extent of the disputed area shall be mapped out in a participatory way with involvement of affected parties Minor (including neighbouring communities where applicable).

Join mapping with the affected parties have been arranged on the SOP handling of social conflicts. Map making land in conflict should be equipped with coordinate data and a scale of 1: 10000, a. At the completion of compensation to Mr. Fajrin, the map does not include the scale and point coordinates. b. In SOP No. 002 / TAP / PRO-CSP-HO / IV / 10 field measurements need to be equipped with a scale. Conclusion: Observation No.30

2.2.6 To avoid escalation of conflict, there shall be no evidence that palm oil operations have instigated violence in maintaining peace and order in their Major current and planned operations.

In procedure of acceptance and resolution of complaints from stakeholders (106899 / TAP / PRO-CSR-HO / VI / 13) points 4.3.3 included all parties must refrain to keep the peace and avoid any form of intimidation, either directly or indirectly from any parties. In addition, the company has a procedure of land acquisition (002 / TAP / PRO-SCP-HO / IV / 10). The procedure containedthe provision of granting compensation process transparentlyand fairly, involved government and traditional leader. Conclusion: conform

2.3 Use of land for oil palm does not diminish the legal rights, or customary rights, of other users, without their free, prior and informed consent.

2.3.1 Maps of an appropriate scale showing the extent of recognised legal,customary or user rights (Criteria 2.2, 7.5 and 7.6) shall be developed Major throughparticipatory mapping involving affected parties (including

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neighbouringcommunities where applicable, and relevant authorities).

The Company has had SOP of Land Acquisition (002/TAP/PRO-SCP-HO/IV/10). In point 4.1.3 has stated land acquisition and compensation based on FPIC.

Conclusion: Conform 2.3.2 Copies of negotiated agreements detailing the process of free, prior and informed consent (FPIC) (Criteria 2.2, 7.5 and 7.6) shall be available and shall Minor include: a) Evidence that a plan has been developed through consultation and discussion with all affected groups in the communities, and that information has been provided to all affected groups, including information on the steps that shall be taken to involve them in decision making; b) Evidence that the company has respected communities’ decisions to give or withhold their consent to the operation at the time that this decision was taken; c) Evidence that the legal, economic, environmental and social implications for permitting operations on their land have been understood and accepted by affected communities, including the implications for the legal status of their land at the expiry of the company’s title, concession or lease on the land. The Company requires certain documentation requirements that must be stored in any settlement of the conflict and compensation. It is listed in the SOP Acquisition of land (002 / TAP / PRO-SCP-HO / IV / 10) and SOP Acceptance and resolution of complaints from stakeholders (106 899 / TAP / PRO-CSR-HO / VI / 13). All data is stored in a separate file for each case.

Related the compensation against Mr. Pajrin located in section E Block E1.3. a. Preferably in the procedure include the requirement to map-making that comes with the title, legend, scale and coordinate points. b. In the official-making letter of measurement has not completed the signature of the village officials. c. At the time the process of compensation, official letter was not available

Conclusion: Observation No.25

2.3.3 All relevant information shall be available in appropriate forms and languages, including assessments of impacts, proposed benefit sharing, Minor and legal arrangements.

There was a relinquishment of rights letter between the company and claim maker; Mr. Pajrin dated February 11, 2014. The relinquishment of rights agreement was made in 3 pieces. The

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legality should be determined because there are no initials on each of the sheet and also signatures of the witnesses made in a separate page. Conclusion : Observation No. 26

2.3.4 Evidence shall be available to show that communities are representedthrough institutions or representatives of their own choosing, Major including legalcounsel.

In the procedure of land acquisition has already contained provisions of compensation document storage of 15 document types. However, the documentation was not complete as required in the procedure. For example, there were no document receipt and compensation minutes. Conclusion: conform

3 COMMITMENT TO LONG-TERM ECONOMIC AND FINANCIAL VIABILITY

3.1 There is an implemented management plan that aims to achieve long-term economic and financial viability

3.1.1 A business or management plan (minimum three years) shall be documented that includes, where appropriate, a business case for scheme smallholders. Major

The company has had a long-term projection (blueprint), 2013 - 2035. In the document have been included estate, mill, social aspects and environmental aspects. Conclusion: conform

3.1.2 An annual replanting programme projected for a minimum of five years (but longer where necessary to reflect the management of fragile soils, see Minor Criterion 4.3), with yearly review, shall be available.

The Company already has replanting plan for next 5 years. Replanting will begin in 2019. Conclusion: conform

4 USE OF APPROPRIATE BEST PRACTICES BY GROWERS AND MILLERS

4.1 Operating procedures are appropriately documented and consistently implemented and monitored

4.1.1 Standard Operating Procedures (SOPs) for estates and mills shall be

Major documented.

The company has procedure land clearings with the principle of non-burning (zero burning). Land clearing methode have contained in Agronomy Procedure revision 1: TAP-PR / AGR / OP- 001 / V09-1. The company also has a SOP for Mill Operation set out in the Technical Guidelines

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Mill. Conclusion: conform

4.1.2 A mechanism to check consistent implementation of procedures shall be in

Minor place.

Company conducted harvesting up to 7 days. There were 213 harvesters, but based on the areal of harvesting (4.326,19 Ha) it needs 230 harvesters so that there were of need harvester as many as 17 people. The Company has a monitoring mechanism for each activity, such as in the implementation of rotation harvesting that has been defined in the SOP that is 7 days.The company has had a crop rotation monitoring such as harvesting is conducted at Bloc K48 up to 18 days. This harvesting activities in accordance with SOP To measure the performance of the processing Mill, the Company has established the Key Performance Index ie: 1. FFB processed include : Hour processing, factory utilization, down time, water consumption 2. Production cost 3. Labour 4. Production quality 5. Losses Conclusion: conform

4.1.3 Records of monitoring and any actions taken shall be maintained and available, as appropriate. Minor

The Company already has the documentation for each activity which was summarized for each activity every month.The company has the equipment test results document such as 2 units Weighbridges. Conclusion: conform

4.1.4 (M) The mill shall record the origins of all third-party sourced Fresh Fruit Bunches (FFB). Major

The Company already has the data of the origin of third parties FFB which was supplied to the POM. Documentation of origin FFB (kg) in 2015:

Supplier FFB (Kg)

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Own Estate 94,981,920

Smallhoder I 80,483,230

Smallhoder II 29,678,158

Conclusion: conform

4.2 Practices maintain soil fertility at, or where possible improve soil fertility to, a level that ensures optimal and sustained yield

4.2.1 There shall be evidence that good agriculture practices, as contained in Standard Operating Procedures (SOPs), are followed to manage soil fertility Minor to a level that ensures optimal and sustained yield, where possible.

The Company already has a SOP for soil sampling (069/PT/VIII/2014) and leaves sampling (050/PT/VIII/2014). The frequency of the soil sampling conducted once every five years, while for leaves sampling that is used for fertilizer recommendations do each once a year. The Company has conducted leaves sampling on August, 21 2015. Company also has conducted analysis of soil sample on December, 18 2015. This sampling was conducted by PT Hijau Persada Sejahtera. Conclusion: conform

4.2.2 Records of fertiliser inputs shall be maintained.

Minor

The Company already has SOP for manual fertilization No. PPG/GMO/ASD/45/SOP to support optimal production by improving soil nutrients. Company already have a realization of fertilization from January until December 2015:

Realization (Kg) Type of Fertilizer Jan-Dec 2015

TAP COM 1 25,100

TAP COM 2 2,089,989

TAP COM 3 1,724,512

PEAT KAY

Borate 54,424

CUSO4

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KIESERITE / DOLOMITE 428,771

RP 361,748

The Company has a Standing Instruction No. 048 / S1-DIR / VIII / 2014 dated August 7, 2014 concerning Implementation Remediation Program / Recovery To Increase Value and Function of HCV area. Based on field observation, company had marked the two rows trunk of palm oil along riparian. This program is an effort to implement the recovery of riparian naturally. The company also did not conduct of treatment and fertilization for oil palm trunk along the riparian. Conclusion: conform

4.2.3 There shall be evidence of periodic tissue and soil sampling to monitor changes in nutrient status. Minor

The Company has conducted leaves sampling on August, 21 2015. Company also has conducted analysis of soil sample on December, 18 2015. This sampling was conducted by PT Hijau Persada Sejahtera. Conclusion: conform

4.2.4 A nutrient recycling strategy shall be in place, and may include use of Empty Fruit Bunches (EFB), Palm Oil Mill Effluent (POME), and palm residues after Minor replanting.

The Company has a strategy to resolve the fragile soils such as sandy areas. The strategy was the utilization of empty bunches to improve the structure of nutrients in the soil. During 2015 the company has applied empty bunch as much 36,250,300 kg with dose of 50 ton / ha / year. Conclusion: conform

4.3 Practices minimize and control erosion and degradation of soils.

4.3.1 Maps of any fragile soils shall be available.

Major

The Company already has a map to reflect the conditions of land suitability to oil palm with a scale of 1: 60.000. Map indicates that the entire area of PT BBB is located in mineral land. Conclusion: conform

4.3.2 A management strategy shall be in place for plantings on slopes above a certain limit (this needs to be soil and climate specific). Minor

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The Company has SOP of making terraces and terraces contour since as management strategy for planting in the area of the slopes.SOP explained that terrace performed on bumpy areas with a slope of 12% -24%. Conclusion: conform

4.3.3 A road maintenance programme shall be in place.

Minor

The Company already has a plan and realization of road repair by means of hardening of the road 51 302 meters and 51 302 meters road maintenance by greader methode. The company also already has a road maintenance plan for 2015. The budget for maintenance road contained in the Annual Budget. Conclusion: conform

4.3.4 Subsidence of peat soils shall be minimised and monitored. A documented water and ground cover management programme shall be in place. Major

The Company has no peatland area. Based on identification, company only is located in mineral land. Conclusion: conform

4.3.5 Drainability assessments shall be required prior to replanting on peat to determine the long-term viability of the necessary drainage for oil palm Minor growing.

The Company has no peatland area. Based on identification, company only is located in mineral land. Conclusion: conform

4.3.6 A management strategy shall be in place for other fragile and problem soils (e.g. sandy, low organic matter, acid sulphate soils). Minor

The Company has a strategy to resolve the fragile soils such as sandy areas. The strategy was the utilization of empty bunches to improve the structure of nutrients in the soil. During 2015 the company has applied empty bunch as much 36,250,300 kg with dose of 50 ton / ha / year. Conclusion: conform

4.4 Practices maintain the quality and availability of surface and groundwater.

4.4.1 An implemented water management plan shall be in place.

Minor

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Water management plan from estate and mill has been included in SOP Water Treatment Plant PT / MILL / V / 2015. Water management conducted through take and use of the river, water quality testing regularly, water treatment in the WTP around the mill. The water source for operational of POM comes from river Sekawan. Sekawan river water is pumped into clarifier basin, sedimentation tanks, and sand filters. The river water is collected on Water Treatment Plan (WTP) Tower. The water is distributed to the mill process, boiler and domestic needs. Testing water quality WTP for domestic needs is conducted every 6 months with reference to the Permenkes 416/1990 regarding clean water. Water quality testing conducted on December 8, 2015. The results of test showed that result meet requirement quality standards. Tests is not conducted for microbiological parameters E Coli. Laboratory analysis result of the well for clean water should be appropriate with Permenkes no. 416 and equipped with testing of E Coli’s parameter. This has been issued as an observation. The Company has had a permit utilization surface water based on decree the Head of Energy and Mineral Resources Muaro Jambi regency No. 01 year 2012 dated April 4, 2012. The decision is valid for 1 year.Company conducted extension permits number 119 121 / BBB / SPM - CSR - SK / III / 2016 dated March 1, 2016 to the Head of BPPT Jambi Province. The process renewal of permit is not completed until surveillance audits. Based on water usage data in January 2016 was 14,069 m3 The company could not show permits SIPA for the entire department in the garden. By sampling, there was no water taking permit permit (SIPA) for wells in section H. This has been issued as Major Non Conformity

Conclusion: Major No.4, Observation No.6

4.4.2 Protection of water courses and wetlands, including maintaining and

Major restoring appropriate riparian and other buffer zones (refer to national best practice and national guidelines) shall be demonstrated.

The Company already has Standing Intruction No. 048/S1-DIR/VIII/2014, dated on August, 7th 2014 concerning implementation of remediaton program to increase the value and function of HCV Area. Based on the field observation, the company had marked the two rows of palm oil rods which is already planted along the riparian river banks as an effort to implement a recovery program of riparian naturally, with no activity and fertilization treatments. Another fact found in the field, the company has set the width of riparian 20 meters left and right of the river or by the size of the spacing of 2 palm trunks. This was not in accordance with the provisions of the applicable laws and regulations (including PP No. 38 of 2012 of the river) and the provisions in the company internal memo no. MI-004 / MD / Sust / XI / 2012 dated November, 12th2012 regarding the protection of riparian river and reservoir water source site Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 35of 114

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(Estate and Mill) which regulates the mechanism of riparian river and reservoir that are still natural and riparian river of TBM / TM, which sets the width of the riparian river at least 50 meters left and right of the river.

There were no maintenance efforts of Sekawan River water that is used by the company. This has been issued as Major Non Conformity No.3.

During follow-up audit, the auditor verifies the corrective actions taken by the company in the form of plantings in Riparian Sekawan River. Sampling of document, its found Official letter No: 01 / BBS-Afd-f / III / 2016 regarding Planting Timber dated March 15, 2016 is available. It contains information that on Tuesday (March 15th 2016) the Company has been conducted timber planting as many as 30 trunks in riparian strip Sekawan for ensuring the conservation of Sekawan River. Auditor can not ensure the implementation in the field during follow up audit because of the weather conditions were rainy. This has been issued as observation.

In the recommendations of HCV assessor has set the width of riparian river 20 meter or by the size of the spacing of 2 palm trunks as HCV4. This is not in accordance with applicable laws and regulations (including PP No. 38 of 2012 on the river). This has been issued as Major Non conformity No.5.

At the time of follow-up audit, the auditor verifies the corrective actions taken by the company. The HCV’s assessor make a recommendation letter No: 260 / IT3.5 / KS / 2016 signed by Ir. Ahmad Faisal Siregar, M.Si on March 8, 2016 stated the width of riparian about 20 meters (for Putat river with 1.5-3 meter wide river and Anak Mendahara river width of 2-4 meters marking on the main stem for not doing chemist treatment. The recommendation letter submitted to the Environment Agency Muaro Jambi, and as the result, there is an approval letter No: 660.4 / 36 / BLH.3 / 2016 dated 4 April 2016 to approve of the results and recommendation of HCV conducted by a team of the Faculty of Forestry, Bogor Agricultural Institute This has been issued as observation.

Conclusion: Major No.3 and No.5 4.4.3 Appropriate treatment of mill effluent to required levels and regular monitoring of discharge quality, especially Biochemical Oxygen Demand Minor (BOD), shall be in compliance with national regulations (Criteria 2.1 and 5.6).

The liquid waste generated from the FFB processing POMis used as land application through the process in WWTP (POME). The Company has obtained permission utilization of waste water on land with an area of 300 hectares through Muaro Regent Decree no. 299 year 2011. The license was stipulated in Muara Jambi, July 12th, 2011 and valid for 5 years. Waste water quality testing was performed 1 month on a facultative pond 1 (before being discharged to land LA). The test results of July-December 2015 conducted by Laboratory of BLHD Jambi was below withquality standard in the LA permit and Keputusan Menteri Lingkungan Hidup no 29 Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 36of 114

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tahun 2003.The parameters of BOD and pH were below the quality standard. Internal measurements were performed forwaste discharge and pH. To monitor the waste pollution in ground water due to land application, the Company monitors every 6 months in 3 locations of monitoring wells and two locations of control wells. Management of soil quality in land control, rorak, and between rorak is conducted once in a year. The last test was conducted on August 2015 by the Laboratory of IPB Bogor. Conclusion: conform

4.4.4 Mill water use per tonne of Fresh Fruit Bunches (FFB) (see Criterion 5.6) shall be monitored. Minor

Company used water during January 2016 for boiler water as much as 11.006 m3 while the water for mill process as much as 11.500 m3. Water use efficiency compared to January of last year's about 1.07 m3 / tonne of FFB. Conclusion: conform

4.5 Pests, diseases, weeds and invasive introduced species are effectively managed using appropriate Integrated Pest Management Techniques

4.5.1 Implementation of Integrated Pest Management (IPM) plans shall be monitored. Major

Company already has procedures for controlling pests and plant diseases which refers to the SOPsensus EWS (TAP-PR/AGR/OP-001/V09-1). The company also has an early warning system (Early Warning System / EWS) through monitoring OPT regularly every month. Conclusion: conform

4.5.2 Training of those involved in IPM implementation shall be demonstrated.

Minor

The company has a census team for each Division, which was coordinated by the foreman of each division. The Company also has census workers who were already assigned as EWS team.The company has conducted IPM Training on November 2, 2015. The Company has also planted host plants for natural enemies such as Turnera subulata and Antigonon. During 2015 the company has been planting Turnera subulata and Antigonon as much as 704.73 Ha Conclusion: conform

4.6 Pesticides are used in a way that do not endanger health or the environment.

4.6.1 Justification of all pesticides used shall be demonstrated. The use of selective products that are specific to the target pest, weed or disease and Major which have minimal effect on non-target species shall be used where Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 37of 114

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available.

The Company already has a list of pesticides used based on the identification of each pests and plant diseases.The Company had a census for each Division and coordinated by the foreman in each division.The Company had census workers that have been appointed as EWS team. The Company already conducted training of IPM Control on November 2nd, 2015.

Conclusion: conform

4.6.2 Records of pesticides use (including active ingredients used and their LD50, area treated, amount of active ingredients applied per ha and number of Major applications) shall be provided.

The Company has a list of chemicals used by the WHO classification, i.e: 1. Herbicide  Metaprima 20 WDG (Methyl metsulfuron), classificationU  Starlon 665 EC (Triklopir), classificationII  Prima up 480 AS (Isopropilamina gliphosat), classification III 2. Insektesida  Acephate (Asefat), classification II  Ratgone (Brodifakum), classification II 3. Rodenticide  Mitac 200 EC (Amitraz), classification II

The Company has a record of chemicals using, for example in January 2016, the company has applied Prima Up (isopropyl gliphosat) of 0.0806 liters per ha; Metaprima (Methyl metsulfuron) of 0.004303 liters per ha and STARLON 665 EC (trichlopyr) of 0.0003211 liters per ha. Conclusion: conform

4.6.3 Any use of pesticides shall be minimised as part of a plan, and in accordance with Integrated Pest Management (IPM) plans. There shall be no prophylactic Major use of pesticides, except in specific situations identified in national Best Practice guidelines.

The company has implemented an integrated pest management to reduce the use of chemicals, by planting Turnera and Antigonon, raising owl. Conclusion: conform

4.6.4 Pesticides that are categorised as World Health Organisation Class 1A or 1B,

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or that are listed by the Stockholm or Rotterdam Conventions, and paraquat, Minor are not used, except in specific situations identified in national Best Practice guidelines. The use of such pesticides shall be minimised and eliminated as part of a plan, and shall only be used in exceptional circumstances.

The Company already has document for monitoring toxicity of pesticide on Pesticide Monitoring Units Monitored in January 2016. The Company has conducted spraying training for staff, foremen and employees working as a sprayer. Company has a policy to discontinue the using paraquat which is recorded in an MI (Internal Memo) No. 001/TAP/MIN-EST-HO/II/2013 concerning Paraquat Herbicide Booking Termination dated 22 February 2013. Company has stopped using Paraquat since March 2013

Conclusion: conform

4.6.5 Pesticides shall only be handled, used or applied by persons who have completed the necessary training and shall always be applied in accordance Major with the product label. Appropriate safety and application equipment shall be provided and used. All precautions attached to the products shall be properly observed, applied, and understood by workers (see Criterion 4.7).

The company has monitored PPE spray and recorded in the spray monitoring book in each Afdelling.

Based on employee’s data, there were 36 people worked with pesticides. The company has had technical guidelines spraying jobs such as technical guidelines spray circle, path and TPH; spot spraying Fabric anti-pollution masks for sprayer was not in accordance with the chemicals used for. Cloth mask used was not mentioned could filter out chemicals C3H8NO5P / Phosphomethyl glicin) (IPA) and metsulfuron methyl. It was suggested that the foreman brought PPE backup such as rubber gloves. This has been issued as observation no. 20.

Based on field observations Afdelling A are sprayers that use rubber gloves that have been torn for work on that day. This has been issued as Observation no.19 Fire training is necessary to ensure the realization of level A, B C and P3K also its implementation in accordance with the scheduling agenda in 2016. The company data indicated that there was no training in 2015. This has been issued as observation no.8 Conclusion: Observation No.19,20, and 8

4.6.6 Storage of all pesticides shall be according to recognised best practices. All pesticide containers shall be properly disposed off and not used for other

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purposes (see Criterion 5.3). Major

Based on observations in the central warehouse, herbicide container waste was stored in a warehouse of hazardous waste. Storage of hazardous and hazardous wasteare arranged in TAP / SOP / 120-SHE / 0001 CHAPTER VI.3 Conclusion: conform

4.6.7 Application of pesticides shall be by proven methods that minimise risk and impacts. Minor

The company has had technical guidelines spraying jobs such as technical guidelines spray circle, path and TPH; spot spraying.

The Company has conducted socialization to the sprayer. The socialization was conducted in Afdeling A on February, 16th2016. Conclusion: conform

4.6.8 Pesticides shall be applied aerially only where there is documented justification. Communities shall be informed of impending aerial pesticide Major applications with all relevant information within reasonable time prior to application.

There are no pesticide applied aerially. Conclusion: conform

4.6.9 Maintenance of employee and associated smallholder knowledge and skills on pesticide handling shall be demonstrated, including provision of Minor appropriate information materials (see Criterion 4.8).

The Company has conducted socialization to the sprayers, including socializaton to the sprayer in Afdelling A was conducted on February, 16th 2016. Conclusion: conform

4.6.10 Proper disposal of waste material, according to procedures that are fully understood by workers and managers shall be demonstrated (see Criterion Minor 5.3).

Waste water from FFB processing is utilized as land aplication. The Company has obtained a license for land application in palm oil plantation throught the Regent Decree No. Muaro 299 Year 2011 dated July, 17th2011. The license covered an area of 300 ha and valid for five years up to July, 16th2016.

There was report of waste waterutilization during the fourth quarter of 2015 and had been

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reported to the relevant agencies on January, 11th 2016. SOP is available on hazardous waste management in the Manual of Environment and OHS No. TAP/SOP/220-SHE/0001 Chapter VI Waste Management B3. The company has cooperated with the shipper and waste collection hazardous of PT. Recognize Indah Sejahtera based on contract No. 142 / MOU-KIS / II / 2016, dated February, 18th 2016. Conclusion: conform

4.6.11 Specific annual medical surveillance for pesticide operators, and documented action to treat related health conditions, shall be demonstrated. Major

Based on employees data there were 36 people worked with pesticides. Medical examinations (cholinesterase) has been carried out twice a year ie on April 29th, 2015 and October 23rd, 2015 Conclusion: conform

4.6.12 No work with pesticides shall be undertaken by pregnant or breast-feeding women. Major

The company has a policy to not employ pregnant and lactating women for spraying activity, as stated in IK-12 / B-OIL / 2014 point 4. It is advised that company to be more persistent in conducting pregnancy test to all female workers who work with chemicals. There were female workers in afdelling A, G, H who have not been examined for pregnancy. Conclusion: Observation No.17

4.7 An occupational health and safety plan is documented, effectively communicated and implemented

4.7.1 A health and safety policy shall be in place. A health and safety plan covering all activities shall be documented and implemented, and its effectiveness Major monitored.

The Company has established integrated policy with Environment, Safety and Occupational Health corporately and signed by the Director of PT. Brahma Bina Bakti, on February 5th, 2013.

The LK3 policy already contained a commitment to improve environmental performance and K3, communicate policies and procedures to all employees and stakeholders, obey laws, identify and assess, and control all the risks and perform continuous improvement to prevent workplace accidents and occupational diseases. Conclusion: conform

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4.7.2 All operations where health and safety is an issue shall be risk assessed, and procedures and actions shall be documented and implemented to address Major the identified issues. All precautions attached to products shall be properly observed and applied to the workers.

The Company has established procedures to conduct assessment of operational risks that could threaten the safety and health, i.e. SOP of Identification and Evaluation of Environmental Aspects and OHS under Section III.1 (TAP / SOP / 120-SHE / 0001). List of OHS and environmental impact identification was established set in 2014. It was a list of environmental and OHS impact assessment from all of OHS activity. However, Hazard Identification and Risk Control is needed to review regularly. The Company already made procedures (SOPs) and work instructions (WI) related to jobs were at risk to safety and health. Some of them are: potential physical and health hazards and the environment arising from the use of chemicals in the workplace. The Company has made safety procedures and precautions, i.e. SOP of chemical hazard communication. The company has monitored and measured work environment in accordance with Permenaker no. 13 in 2011, covering a threshold value factor of physics, chemistry, and biology in each work area. An assesment of work environmentwas conducted on May 11th, 2015, including noise, vibration, lighting, ISBB (Indeks Suhu Bola Basah), and dust. The results of noise measurements in Generator, Boiler, and Loading ramp wereexceeds 85 dBA. The Company has conducted health surveillance for the parameter of audiometry and spirometry on October 23, 2015 to the 21 people appointed by HRD for audiometric testing and spirometry. The surveillance results showed that some people experienced audiometric hearing impaired either the right ear or the left ear. Those person have been sent to ENT spealized doctor. The results of this examination will be seen next year pad. The Company also health surveillance for the parameter of Cholinesterase against 57 sprayers which carried on 23 October 2015. The results of the surveillance showed that all the examinee were in the rage of normal circumstances. The company has been subjected to legal inspection on its equipments e.g boilers, Sterilizer, Steam turbines, diesel motors, pressure vessels, static craine, hoisting craine, wheel loaders. The company has several licensed equipments operators including: Boiler operators, some lifting equipment operators (Craine, loader, wheel loader). But the company did not have electrical safety technicians. Conclusion: conform

4.7.3 All workers involved in the operation shall be adequately trained in safe working practices (see Criterion 4.8). Adequate and appropriate protective Major equipment shall be available to all workers at the place of work to cover all potentially hazardous operations, such as pesticide application, machine operations, and land preparation, harvesting and, if it is used, burning.

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The Company has set a competency matrix thus obtained gap for every function. Identification of training undertaken has referred to the competency gaps and proposals of each section. Procedure of employee training has included the evaluation of the effectiveness of training by direct supervisor. The Company has established a training program related to the environment, safety and health, and RSPO in 2015. At the time of audit, company already had licensed workforces i.e first aider, fire officer class A, B, C, and electrical safety. The training has been conducted during the 2015's in the estate as well as in the POM i.e FFB grading on February 22, 2015, the danger of spinning objects and use of PPE on October 29, 2015, socialization PPE training APD to drivers and contractors 26th January 2016 attended by 9 people, fire extinguisher attended by as many as 19 persons, dated February 25, 2016, dissemination SOP OHS to 61 persons, February 23, 2016, the socialization MSDS to employees of chemical warehouse dated February 15, 2016, training warehouse operators related to the mixing of pesticides dated February 19, 2016, training of manuring attended by 12 people dated February 19, 2016, the socialization of PPE to employees dated February 6, 2016, training in the use fire extinguisher and wet sacks to housewives on 7 April 2015, training in the use of portable fire extinguisher for the employees of the plant February 12, 2015, and the training of spraying attended by 61 persons dated February 22, 2016. The company has been providing personal protective equipment for their employees. On examination of the document at the spraying, in each Afdelling found that PPE of sprayers has been inspected prior to work. On a visit to the field, it was found that sprayers and harvesters have provided with PPE.

Conclusion: conform

4.7.4 The responsible person/persons shall be identified. There shall be records of regular meetings between the responsible person/s and workers. Concerns Major of all parties about health, safety and welfare shall be discussed at these meetings, and any issues raised shall be recorded.

Organization has set a standard job description and competence at every function and position. The company has already set up a committee which will be responsible for the OHS problems. At each SOP and IK have been issued, has been assigned the duties and responsibilities of each corresponding process flow of activities. Meanwhile, in order to meet the provisions of national legislation, in this case Permenaker No. 04 / MEN / 1987, the company has already formed safety commitees which have been endorsed by the Manpower and Transmigration Office of District of Muaro. The data endorsement is Kep 566/51 / Sosnakertrans in February 2016, where the secretary is the General Safety expert. Safety Committee monthly meetings have been conducted by the Estate and Mill. Safety Committee activity has been reported to the Social Service Agency of Manpower and Transmigration Muaro Jambi. Last safety committe report has been conductee at the fourth quarter (October-December 2015).

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Conclusion: conform

4.7.5 Accident and emergency procedures shall exist and instructions shall be clearly understood by all workers. Accident procedures shall be available in Minor the appropriate language of the workforce. Assigned operatives trained in First Aid should be present in both field and other operations, and first aid equipment shall be available at worksites. Records of all accidents shall be kept and periodically reviewed.

The Company has established some procedures and work instructions related work accidents and emergencies. Procedures and work instructions applies to all units under PT. BBB. Here are some procedures (SOPs) and work instructions (IK) that has been made: Incident Investigation SOP, SOP First Aid, Emergency Response Plan SOP, SOP Medical Services, Medical Flow chart Emergency Plan All units already own first aider who have been trained internally on 29 November 2014, which was attended by 15 people and conducted by Hyperkes company, but for licensed first aider training from the Manpower agency was just planned to conduct in March 2016. First aid boxes were available in each division or unit that is class A box which is in accordance with Manpower regulation no. 15 in 2008. As for the foreman in the field have provided with a bag of class A first aid boxes. In addition there were other facilities to support the emergency response preparedness i.e 1 unit of ambulance along with the equipments and there was a paramedic who accompanied the patient. Company already have health Clinik of DHO Muaro with no. 441/09 / SIKP / DHO / 2016. Company doctor has been appointed a examiner from the Ministry of Labor no. 17.525 / DH-I / 07 Emergency response equipments in the section H of estate were neither sufficient nor available in locations such as a water tank. This has been issued as an observation.

Conclusion: Observation No.12

4.7.6 All workers shall be provided with medical care, and covered by accident insurance. Minor

The Company has not paid the premiums of health insurance (BPJS kesehatan), retirement insurance and pensions for daily casual worker as seen in their paycheck month of December 2105 and January 2016 Conclusion: Minor No.13

4.7.7 Occupational injuries shall be recorded using Lost Time Accident (LTA) metrics. Minor

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During the year 2015 up to now there was no occupational accident in factories as well as in the estate. It is advised to provide the sheet for routine checks on the ambulance readines. The company has been cooperating with the nearest referral hospital (Hospital Ahmad Rifin Muaro Jambi). The Company has calculated the frequency rate (FR) and the severity rate (SR) from the accident during 2015. The calculation refers to the provision in Ministerial Regulation No. 03 / MEN / 1998, and already counting Lost Time Accident. Calculation results are recorded in the sheet of SR / FR Monthly. There was guides Procedure Charging FR Format - SR Conclusion: Conform

4.8 All staff, workers, smallholders and contractors are appropriately trained.

4.8.1 A formal training programme shall be in place that covers all aspects of the RSPO Principles and Criteria, and that includes regular assessments of Major training needs and documentation of the programme.

The company has had a training program on site. The training is reported monthly. The training that have been implemented include training for officers spraying, fertilizing, safety for transportation, socialization of use PPE, fire extinguisher Training for farmers has been carried out between the months of October to December 2015 include harvesting, fertilizing, maintenance, weed control, OHS and HCV conservation Conclusion: conform

4.8.2 Records of training for each employee shall be maintained.

Minor

The training, which was attended by labor, are recorded on the sheet of employee training. Conclusion: conform

5 ENVIRONMENTAL RESPONSIBILITY AND CONSERVATION OF NATURAL RESOURCES AND BIODIVERSITY

5.1 Aspects of plantation and mill management, including replanting, that have environmental impacts are identified, and plans to mitigate the negative

impacts and promote the positive ones are made, implemented and monitored, to demonstrate

5.1.1 An environmental impact assessment (EIA) shall be documented.

Major

The Company had identified environmental aspect and impact (ISO 14001), but not all activities in estate and millwere identified, such as land application and sanitation activity that produce

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domestic waste, monitoring and deep well. The Company has document of of EIA as outlined in the Dokumen Evaluasi Lingkungan Hidup (DELH), dated April 30, 2010. DELH has been approved by the Regent Muaro through Decree of Environmental Head / Kepala Kantor Lingkungan Hidup, number 11 Year 2010 regarding to Environmental Evaluation Document of Palm Oil Plantation (main estate and smallholder) and Palm Oil Mill, covering an area of 10,500 hectares in the district of Sekernan, regency of Muaro Jambi by PT Brahma Binabakti, dated December 27th, 2010. DELH and RKL/RPL have been arranged by CV. Sangga Buana Lestari in Jambi, 2010. There was recommendation document regarding to assessment results of land applicationthrough document no. 660 / 923 / LH / 2010 by Muaro Jambi Regent, dated April 26th, 2010. The operation of palm oil plantation has been started since 1994 and POM since 2000. The implementation of RKL / RPL 2nd semester 2015 has been reported to BLH Muara Jambi regency and Jambi provinces.

Conclusion: Conform

5.1.2 Where the identification of impacts requires changes in current practices, in order to mitigate negative effects, a timetable for change shall be developed Minor and implemented within a comprehensive management plan. The management plan shall identify the responsible person/persons.

Environmental monitoring plan has been set in the Matrix of Environmental Performance Monitoring and Measurement, which is included monitoring and measurement parameters, reference regulations, location of measurement, coordinate, frequency of monitoring, evidence of compliance, laboratory test, and PIC. The company reports environmental monitoring and management every 6 (six) months to BLH Muaro Jambi regency and Jambi province. Monitoring of environmental management that is reported include tests of wastewater, groundwater, soil physical and chemical, ambient air, generators emissions, boiler emissions, odor, surface / river, water biota, water, and noise. Reporting of hazardous waste monitoring has been conducted on October until December 2015 to BLH Muaro Jambi regency and Jambi provinces. At the time of surveillance audit, the company has not measured yet the domestic wastewater from offices and housing. This has been issued as Minor non conformity. Conclusion: Minor No.9

5.1.3 This plan shall incorporate a monitoring protocol, adaptive to operational changes, which shall be implemented to monitor the effectiveness of the Minor mitigation measures. The plan shall be reviewed as a minimum every two years to reflect the results of monitoring and where there are operational

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changes that may have positive and negative environmental impacts.

In order to measure the effectiveness of Company’s environmental management, they conduct monitoring environmental periodically as required in RKL / RPL EIA document. Besides referring to the matrix of RKL / RPL, the Company also conduct hazardous waste management and monitoring and water quality test. Monitoring of domestic waste in accordance with LH Decree no. 112 of 2003 has not been made by the company. This has been issued as Minor non conformity. Conclusion : Minor No.10

5.2 The status of rare, threatened or endangered species and high conservation value habitats, if any, that exist in the plantation or that could be affected by plantation or mill management, shall be identified and operations managed to best ensure that they are maintained and/or enhanched

5.2.1 Information shall be collated in a High Conservation Value (HCV) assessment that includes both the planted area itself and relevant wider landscape-level considerations (such as wildlife corridors). Major

Based on HCV identification, was obtained:  In PT BBB concession area, only identified one type of HCV, i.e. HCV 4.1 (important area or ecosystem as water provider and flood control for downstream communities) in the form of riparian area of 30.66 ha, consist of tributary riparian of Mendahara around 16.26 ha and tributary riparian of Suak Putat around 14.40 ha, with a border width of 20 m left and right of the river.  Determination of riparian river width based on consultant recommendation who carried out identification, with consideration of the fragmentation degree and the structure of riparian vegetation of Mendahara river and Suak Putat river to capture or reduce sedimentation and runoff pollutants, particularly from pesticides and fertilizers. This study refers to the research of Fennesy & Cronk (1997) and Parkyn (2004), who has reviewed the study regarding to the effectiveness of riparian zones in reducing contaminants, especially nitrate solution with a reduction rate almost 100% in the buffer with a width of 20-30 m.  Wildlife species identified four species of mammals, four types of reptiles and 25 species of aves. There are no animals are included in the category of critically endangered. Plant species is not found in the critical status category according to the IUCN Red List. Almost the whole of vegetation cover in the concession area of PT BBB is monoculture crops (palm oil and rubber). Conclusion: conform

5.2.2 Where rare, threatened or endangered (RTE) species, or HCVs, are present or are affected by plantation or mill operations, appropriate measures that are Major expected to maintain and/or enhance them shall be implemented through a Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 47of 114

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management plan.

 Based on HCV identification is known types of wildlife in the PT. BBB concession area as follows: 4 species of mammals, 25 species of birds and 4 species of reptiles.There are no critically endangered species in the PT. BBB concession area. However, it is founded 6 protected species, 8 types of animals are included on Appendix II of CITES.

Protection status based on : No Species PP No 7/1999 Appendix CITES IUCN

Kucing hutan Protected App II LC

Elang tikus Protected App II LC

Br. Raja Udang meninting Protected - LC

Br. Madu belukar Protected - LC

Br Madu sriganti Protected - LC

Br. Serak jawa Unprotected App II LC

Br. Serak bukit Unprotected App II LC

Kera abu-abu ekor panjang Unprotected App II LC

Biawak Unprotected App II LC

Ular kobra Unprotected App II LC

Ular sanca Protected App II NT

Notes : LC (Least Concern) NT (Near Threatened) App II = the list of species that are not threatened with extinction, but will be threatened if trade is continued without adjusment  Technical Guideline for handling Orang Utan and Wildlife Protected Areas in the company areais available on procedure no. 001 / PT_HCV / III / 2015. The guideline consist oforang utanhandling, tiger and / or elephant goes into the plantation concession area as well as prevention technic of wildlife nuisance before the estateis built.  There are reports of socialization to employees and community around the estate and sanctions for those who break the rules.

Conclusion: conform

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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 Minor 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.

Available evidence of sustainibility training to all staff in the unit manager who is responsible to handle HCV in PT TAP. For example, evidence of training which was held on July 11-12, 2013, attended by 7 participants from PT GSBM, PT BBB, PT FLTI, PT MIK and PT EBL with presenters Samsul Rijal of Environment Department. Conclusion: conform

5.2.4 Where a management plan has been created there shall be ongoing

Minor monitoring: The status of HCV and RTE species that are affected by plantation or mill operations shall be documented and reported; Outcomes of monitoring shall be fed back into the management plan.

 Management and Monitoring Plan of HCV area based on the recommendation from HCV study team is available.  There are reports of monitoring the presence of wildlife in the HCV area that is reported every 6 months to the Head of BKSDA Jambi. Conclusion: Conform

5.2.5 Where HCV set-asides with existing rights of local communities have been identified, there shall be evidence of a negotiated agreement that optimally Minor safeguards both the HCVs and these rights.

Based on HCV identification, HCV area are not common and specified in smallholder or community land outside HGU PT BBB, so there is no agreement to protect HCV. Conclusion: conform

5.3 Waste is reduced, recycled, re-used and disposed of in an environmentally and socially responsible manner

5.3.1 All waste products and sources of pollution shall be identified and documented. Major

Identification of waste types and sources is established on SOP K3L TAP / SOP / 120 – SHE / 0001 Bab VI.1 Hazardous Waste Handling, VI.2 Land Application, SOP / HPP/ / VII / 2015 / 001 Waste Management in Site and Internal Memo (MI – 002 / MD / SUST / XI / 2014 Monitoring and Measuring of EHS Aspect Key Parameter.

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The Company has made reports of identifying sources of waste, pollution and contamination which is produced from mill and estates operational.Type of waste produced consists of 1. Palm oil mill effluent (POME) that is processed into WWTP, domestic waste water, dirty waste from the toilet, discharged directly into custom channels leading to the septic tank. 2. Organic Waste: special waste from POM. i.e. empty bunch (empty fruit bunch / EFB), solid (decanter cake), fiber, kernel shells, boiler ash. Other organic waste, i.e. wood, paper / cardboard, leaves. 3. Inorganic waste, i.e. plastic bags / former fertilizer, plastic packaging beverage / food, drink cans, zinc, and glass. Time remaining metal cutting gas output, used tires, scrap / large size scrap metal. 4. Gas Emission: boiler emissions, generators emissions, emissions from heavy equipment vehicles, methane emissions from WWTP. Liquid hazardous waste, i.e. used things, such as oil lubrication, solar, waste water from laboratory analysist / expired. Solid hazardous waste, i.e. used things, such as package of chemicals (pesticides, herbicides, fungicides, insecticides), batteries of vehicles, filter oil and diesel fuel, cloth rags, gloves contaminated by oil / diesel / grease, packaging (sacks, jerigan, tin cans), battery calculator / flashlight / clocks, fluorescent light bulbs, cans of paint and thinner, toner / cartridge photo, copy machine toner printer, typewriter ribbons / printer, medical waste (syringes, gauze, or cotton or gloves that is mixed with blood).

Conclusion: conform

5.3.2 All chemicals and their containers shall be disposed of responsibly.

Major

None of waste pesticide containers are reused but directly returned to the warehouse to be deliveredinto the polling station of hazardous waste. There were documented handover notes from B3 waste generated from each section Permission of hazardous waste temporary storage to PT. Brahma Bina Bakti No. 04 / Kep.Ka.BPTSP / III / 2015 includes the POM and estates. The Permissions was issued by Head of Badan Pelayanan Terpadu Satu Pintuin Muaro Jambi, dated March 25th, 2015 which covered used things, such as oil, oil filters, rags, gloves, packaging contaminated with hazardous things, TL lamp, accu, contaminated medical waste. The Company is cooperated with hazardous waste collector and transporter namely PT. Kenali Indah Sejahtera who hasreceived recommendation from Ministry of the Environment to collect hazardous waste with no. 06.7.04 2015 and hazardous waste transporter with no. S-2309 / PSLB3 - VPLB3 / 2015. Agreement letter with PT. Kenali Indah Sejahterais provided through contract No. 142 / MOU - RIS / II / 2016. Last transport was performed on February 24th, 2016 by truck. The transport vehicle has got permission from Department of Land Transportation for transporting hazardous materials. Hazardous waste transported include medical waste, filter used, contaminated package, a former cotton waste, used rags, used batteries, and used fluorescent lamp.

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Hazardous waste manifest has been provided for each individual type of hazardous waste. Based on manifest data relevant legal documents, the hazardous waste beneficiaries / waste manager of PT. BBB has received permission from Ministry of Environment. In addition, the company has a cooperation with PT. Tenang Jaya Sejahtera as hazardous waste processing and destructiing with agreement letter no. / TJS - KF / KIS / B3 / VIII / 2016. Solid wastes such as shell and fiber are used as a substitute to fossil fuels for turbines, some of shells resale to outsiders. Empty fruit bunches is used to replace chemical fertilizer. Solid Decanter is also used as fertilizer on main estate and smallholder. Liquid waste used as fertilizer withland application management method. The liquid waste generated from FFB processing in POM is used as land application through the process in WWTP (POME). The Company has obtained permission utilization of waste water on land with an area of 300 hectares through Muaro Regent Decree no. 299 year 2011. The license was stipulated in Muara Jambi, July 12th, 2011 and valid for 5 years. Generally, domestic waste has been managed properly, as evidenced by the existence of segregation bins for organic and inorganic garbage in some places. Organic and inorganic domestic wastes aretransported separately by truck. Organic waste is weighed and then planted in the ground (landfill). Whereas, inorganic waste is sold. Waste water quality testing was performed 1 month on a facultative pond 1 (before being discharged to land LA). The test results of July-December 2015 conducted by Laboratory of BLHD Jambi was below withquality standard in the LA permit and Keputusan Menteri Lingkungan Hidup no 29 tahun 2003.The parameters of BOD and pH were below the quality standard. Internal measurements were performed forwaste discharge and pH. Monitoring of air emission is conducted once in 6 (six) months. Emission testing was tperformed on December 11th, 2015 by a third party laboratory. The test results for each emission source can be described as follows:  Ambient air. Test location was outside POM with 1 point. The test results was meet with Governemnt Regulation, PP RI 41 1999.  Emission boiler 1 and 2. The test results was meet with Per-07 / MENLH / 2007.  Emissions of central generator 1 and 2. The test results was meet with the Keputusan Menteri Lingkungan Hidup no 21 2008. The company carried out periodic testing every six months to monitor the river water quality. Water testing was conducted by PT. Unilab Prime in December 2015. The test result was below the quality standards in Governemnt Regulation of 82 2001 class water of 2. The Company takes measurements of water biota in Sekawan river, i.e plankton and benthos. The measurement of domestic wastewater from sanitation activity in the offices and housing have not been conducted yet in accordance with the standard in Kep Men LH 122 2003. Zero buring is applies as regulated in the Internal Memo no. MI-003 / MD / Sust / XI / 2014 dated 10 November 2014 regarding to the prevention and treatment of fires in the Estate and Mill,

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issued by the Director. Conclusion: conform

5.3.3 A waste management and disposal plan to avoid or reduce pollution shall be documented and implemented. Minor

The liquid waste generated from FFB processing in POM is used as land application through the process in WWTP (POME). The Company has obtained permission utilization of waste water on land with an area of 300 hectares through Muaro Regent Decree no. 299 year 2011. The license was stipulated in Muara Jambi, July 12th, 2011 and valid for 5 years. The Company has permission of hazardous waste temporary storage to PT. Brahma Bina Bakti No. 04 / Kep.Ka.BPTSP / III / 2015 includes the POM and estates. The Permissions was issued by Head of Badan Pelayanan Terpadu Satu Pintu in Muaro Jambi, dated March 25th, 2015. The Cimpany has procedure regarding to manage hazardous waste as stated in Environmenta and OHS Handbook, no. TAP/SOP/220-SHE/0001 Chapter VI Hazardous Waste Management. The Company is cooperated with hazardous waste collector and transporter namely PT. Kenali Indah Sejahtera through agreement letter no. 142/MOU-KIS/II/2016, dated February 18th, 2016. License to transport and collect hazardous waste of PT. Kirana Sekernan is based on Decree of, Environmental Head of Jambi (Kepala Bapedal Jambi), no 68 year of 2014, dated October 14th, 2014. In section H of pesticide management in rinse house on its use has not been found contaimen secondary and effluent control at rinse housetanks. This has been issued as minor non conformity The Company should ensure the implementation and documentation of the entire program and long-term targets in order to reduce domestic solid waste, reduction of emissions and a reduction in water use. The efforts should be monitored and measured. This has been issued as observation. Conclusion: Minor No.7, Observation No.11

5.4 Efficiency of fossil fuel use and the use of renewable energy is optimized

5.4.1 A plan for improving efficiency of the use of fossil fuels and to optimise renewable energy shall be in place and monitored. Minor

The Company has established program to conduct energy efficiency as stipulated in the OTP 2015, i.e. efficiency energy such as fuel monitoring for tools and vehicles, calculate fuel consumption, the write-off vehicles that are not feasible. Fossil fuels monitorin in POM is conducted daily. Based on data from January 2016 to date, energy consumption ofshell and fiber to produce 1 tonne of CPO was 48,518 million kcal / ton CPO, while energy consumption of diesel fuel to produce 1 tonne of CPO was 394,095.900 kcal,so that the energy efficiency was 88% per tonne of CPO produced (345,576.723 Kcal)

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The Company conducts diesel fuel monitoring to vehicle, heavy vehicle, and genset using in the estate. Diesel fuel usage data from year to year is decreased due to a reduction in vehicle using, eg. truck. Conclusion: conform

5.5 Use of fire for waste disposal and for preparing land for replanting is avoided except in specific situations, as identified in the ASEAN guidelines or other regional best practice.

5.5.1 There shall be no land preparation by burning, other than in specific situations as identified in the ‘Guidelines for the Implementation of the Major ASEAN Policy on Zero Burning’ 2003, or comparable guidelines in other regions.

The Company has SPO Opening Land with Zero Burning as stated in Agronomy Prcedure (TAP-PR/AGR/OP-001/V09-1) Conclusion: conform

5.5.2 Where fire has been used for preparing land for replanting, there shall be

Minor evidence of prior approval of the controlled burning as specified in ‘Guidelines for the Implementation of the ASEAN Policy on Zero Burning’ 2003, or comparable guidelines in other regions.

The Company already has replanting plan to be conducted from 2018 until 2021 with a system of opening land without burning. The following plan of palm oil replanting, as follows:

Year Area

2018 1,006

2019 1,113

2020 896

2021 582

Conclusion: conform

5.6 Plans to reduce pollution and emissions, including greenhouse gases, are developed, implemented, and monitored.

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5.6.1 An assessment of all polluting activities shall be conducted, including gaseous emissions, particulate/soot emissions and effluent (see Criterion 4.4 Major

Company has established Greenhouse Gas Emission Reduction procedures (No. TAP/SOP/120-HCV/004) which contains the identification and reduction of greenhouse gases.

The Company has conducted identification and inventory of GHG emission on January 22nd, 2016. Sources of GHG emission come from land clearing, TBS transportation from estate to POM, fertilizer & pesticide application, genset, and POME. GHG emission calculation in 2015 was 5.24 tCO2e- and emission total was 16.09 tCO2e-. Conclusion: conform

5.6.2 Significant pollutant and greenhouse gas (GHG) emissions shall be identified, and plans to reduce or minimize them implemented Major

The Company has conducted identification and inventory of GHG emission on January 22nd, 2016. Sources of GHG emission come from land clearing, TBS transportation from estate to POM, fertilizer & pesticide application, genset, and POME. GHG emission calculation in 2015 was 5.24 tCO2e- and emission total was 16.09 tCO2e-. The Company has established SOP of GHG Mitigation as stated on internal memo MI- 003/MD/SUST/XI/2012, dated November 12th, 2012 regarding to minimize GHG emission from estate and POM. Land use trajectory report was provided by Environmental Department on January, 19th, 2016. The report was described land use trajectory from scrubland into palm oil plantation since 1995 until 2015 with total area of 4,359.59 ha. Conclusion: conform

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, Minor using appropriate tools.

The liquid waste generated from FFB processing in POM is used as land application through the process in WWTP (POME). Waste water management report in 4th quarter of 2015 has been submitted to related agency on January 11th, 2016. Conclusion: conform

6 RESPONSIBLE CONSIDERATION OF EMPLOYEES AND OF INDIVIDUALS AND COMMUNITIES AFFECTED BY GROWERS AND MILLS

6.1 Aspects of estate and mill management that have social impacts are identified in a participatory way, and plans to mitigate the negative impacts and promote the positive ones are made, implemented and monitored, to Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 54of 114

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demonstrate continuous improvement

6.1.1 A social impact assessment (SIA) including records of meetings shall be documented. Major

Company has conducted SIA which was carried out by Konsultan Lingkar Sawit (LINKS) in 2013.PT. BBB has conducted SIA in 2013 and prepared the activity report. The report contains recommendations of CSR programs for future activities. There are 14 recommendations in total, and those associated with impacts due to the activities of estate and mill. Conclusion: conform

6.1.2 There shall be evidence that the assessment has been done with theparticipation of affected parties. Major

As a follow up activity on SIA, PT. BBB has prepared CSR Activity Plan 2014 based on recommendations in the SIA. From the minutes of a meeting with stakeholder held on 9 Sept 2014 at Sekernan District Meeting Hall and from interviews of personnel it is found that the preparation of CSR activities has involved the community.

Conclusion: conform

6.1.3 Plans for avoidance or mitigation of negative impacts and promotion of thepositive ones, and monitoring of impacts identified, shall be developed Major inconsultation with the affected parties, documented and timetabled, includingresponsibilities for implementation. PT. BBB has developed a strategic plan for CSR activities for 5 (five) years, 2014-2018. Activities are grouped into the following areas:

- Social, Cultural, Religious

- Education

- Health

- Economic

- Plasma Coaching

Related to the SIA, should be ascertained: a. Ensuring relevant agenda has been realized or not in the plan and the realization of CSR b. Make sure their efforts to improve the welfare of communities (Community Development)

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Conclusion: Observation No.28

6.1.4 The plans shall be reviewed as a minimum once every two years and updated asnecessary, in those cases where the review has concluded that changes Minor shouldbe made to current practices. There shall be evidence that the review includesthe participation of affected parties.

Company has been showed society perception on monitor work instruction as tool for reviewing policy and practice that has been conducted by Company to become material for program revision/ plan on the future year. Conclusion: conform

6.1.5 Particular attention shall be paid to the impacts of smallholder schemes (wherethe plantation includes such a scheme). Minor PT. BBB has conducted management planning with the participation of the community. This is contained in the report of SIA activities which involve surrounding village community. In addition, the CSR program monitoring activities of PT. BBB also has involved the community. This is contained in the evaluation report of CSR program 2013.

Minutes of a consultation meeting with stakeholders on 9 September 2014 and interviews of personnel show that in the CSR program PT. BBB accommodates the aspirations of the community.

Company has a partnership with plasma farmers which consist of 1. Plasma 1; 2. Plasma 2 and 3. Plasma Pemayung

Plasma 1 and plasma 2 are affiliated with cooperative Akso Dano. Plasma Pemayung is affiliated with cooperative Dano Bangko. Company already has a MOU with Plasma Pemayung dated 30 January 2012.

Company already has a MOU with cooperative Akso Dano for plasma 1 and plasma 2. There are 2 MOU available for company and cooperative Akso Dano. An expired MOU has found i.e. the MOU between the company and Cooperative Akso Dano which is made into on 6 February 1995. This MOU says that the MOU will terminate when the credit with Bank BNI has been paid (article 15, page 6). Addendum/revision of the MOU is not found. Cooperation Agreement document between company and cooperatives (plasma 1 and 2) which regulates the method of grading/penalty, payment and other things that need to be mutually agreed is not found.

Conclusion : conform

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

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6.2.1 Consultation and communication procedures shall be documented.

Major Company already has a documented mechanism for land dispute resolution. This is contained in the internal memo (MI) Stakeholder Complaint Handling in the Site (Estate & Mill) No. MI- 005/MD/SUST/X/2012. Also, StakeholdersComplaint Receiving and Resolution SOP (No. 106899/TAP/PRO-CSR-HO/VI/13) has been established which is provided with a flowchart starting from the identification process to the production of minutes, and put into force on 13 June2013. The scope includes: complaints from stakeholders, complaints on a contract, and land dispute resolution. List of stakeholders already exists in the company area, including: religious leaders, customary leaders, village chiefs, members of plasma, cooperatives, local police, contractors, suppliers, and related agencies complete with names& addresses. The list of Stakeholders made is as per 2013.

Conclusion: conform

6.2.2 A management official responsible for these issues shall be nominated.

Minor

There were complaints from members of the plasma farmer groups which are recorded in the form: 106181/TAP/PRO-CSR-HO/VI/13, document No. 002, on 5 August 2014. One of the members of Asoka Farmer Group filed a complaint that he wanted to quit from his plasma group i.e. Asoka 1 A and move to the group of Asoka 1 B. The results of interview with the information source show that the problem has been dealt with by the company immediately and the case is resolved properly. The complaint status in the form has been closed and resolved. Conclusion : Conform

6.2.3 A list of stakeholders, records of all communication, including confirmation of receipt and that efforts are made to ensure understanding by affected Minor parties, and records of actions taken in response to input from stakeholders, shall be maintained.

Company already has a documented mechanism for land dispute resolution. This is contained in the internal memo (MI) Stakeholder Complaint Handling in the Site (Estate & Mill) No. MI- 005/MD/SUST/X/2012. Also, StakeholdersComplaint Receiving and Resolution SOP (No. 106899/TAP/PRO-CSR-HO/VI/13) has been established which is provided with a flowchart starting from the identification process to the production of minutes, and put into force on 13 June2013. The scope includes: complaints from stakeholders, complaints on a contract, and land dispute resolution. List of stakeholders already exists in the company area, including: religious leaders, customary leaders, village chiefs, members of plasma, cooperatives, local police, contractors, suppliers, and related agencies complete with names& addresses. The list of

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Stakeholders made is as per 2013. Conclusion: conform

6.3 There is a mutually agreed and documented system for dealing with complaints and grievances, which is implemented and accepted by all parties

6.3.1 The system, open to all affected parties, shall resolve disputes in an effective,timely and appropriate manner, ensuring anonymity of complainants Major andwhistle-blowers, where requested.

Complaint and grievance was stipulated in Article 49 of the Company Regulations and Article 50 of the Dispute Settlement Settlement laments. The company has the SOP Resolution Complaints Employees (TAP-PR / HRD-GN / 063-0113-0, 01.18.2013, compiled by HR Dept. Dept. Operation & Social Impact, examined by HR Div.Head, and Sustainability Dept. . Head, and approved by the Managing Dir. Starting effective as per 01/18/2013. However, these procedures have not covered the anonimity of the complainant. Socialization regarding complaint in 2015 has been carried out in the estate division Conclusion: Observation No.15

6.3.2 Documentation of both the process by which a dispute was resolved and the outcome shall be available. Major

Grievances and complaint submitted was filed in sheet no. TAP / FO / SIA-0003. In general, complaints and complaints submitted through the immediate supervisor, suggestion boxes and unions. Suggestions were submitted via the suggestion box. which was monitored weekly. During 2015 there were no complaints submitted via suggestion box In the certification report, there was an observation raised stated that the union did not record complaints submitted via it. At the ASA I, company has recorded, among other complaints regarding the provision of school buses for children who attend afternoon course (February 2016), concerning sports facilities (May 2015). Complaints records recorded in a complaint form no. TAP / FO / SIA-0003. In general, complaints are submitted through the immediate supervisor, suggestion boxes and unions. For suggestions submitted via the suggestion box is monitored every week. During 2015 there were no complaints submitted via the suggestion box. In the certification report, there was observation that the union did not record complaints. At the time of audit surveillance 1, the company has recorded complaints regarding the provision of school buses for children who attend afternoon course (February 2016) and concerning sports facilities (May 2015)

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Conclusion: conform

6.4 Any negotiations concerning compensation for loss of legal or customary rights are dealt with through a documented system that enables indigenous peoples, local communities and other stake holders to express their views through their own representative institutions

6.4.1 A procedure for identifying legal, customary or user rights, and a procedure for identifying people entitled to compensation, shall be in place. Major The existence of indigenous peoples and customary land is not found. However the Company already has a documented land dispute resolution mechanisms. This was stated in an internal memo (MI) Redress Stakeholders in the Site (Estate & Mill) No. MI-005 / MD / Sust / X / 2012. In addition, there was an SOP of Acceptance and Settlement of Complaint From Stakeholders (No. 106 899 / TAP / PRO-CSR-HO / VI / 13) which is equipped with a flowchart which starts from the identification process to preparing BA, enacted on June 13, 2013. The scope includes: complaints from the stakeholders, complaints contract, until the settlement of land disputes.

Conclusion: conform

6.4.2 A procedure for calculating and distributing fair compensation (monetary orotherwise) shall be established and implemented, monitored and evaluated Minor in aparticipatory way, and corrective actions taken as a result of this evaluation. Thisprocedure shall take into account: gender differences in the power to claimrights, ownership and access to land; differences of transmigrants and longestablishedcommunities; and differences in ethnic groups’ proof of legal versuscommunal ownership of land. Company already has a documented land dispute resolution mechanism. This was stated in an internal memo (MI) Redress Stakeholders in the Site (Estate & Mill) No. MI-005 / MD / Sust / X / 2012. In addition, there was an SOP of Acceptance and Settlement of Complaint From Stakeholders (No. 106 899 / TAP / PRO-CSR-HO / VI / 13) which is equipped with a flowchart which starts from the identification process to preparing BA, enacted on June 13, 2013. The scope includes: complaints from the stakeholders, complaints contract, until the settlement of land disputes.

Conclusion: Conform

6.4.3 The process and outcome of any negotiated agreements and compensation claims shall be documented, with evidence of the participation of affected Major parties, and made publicly available.

Land disputes occurred among people who called themselves Society 8 village, led by Chairman of the NGO FMP (Farmer Community Forum), Roni Paslah. The group claimed that the company to return the land that he considered had been occupied by the Company. On May 10, 2013 land dispute was solved due to the demands of the NGO FMP, "can not be proved in

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accordance with the applicable legislation. This was based on the decision of the Regional Leadership Forum Kab. Muaro No. 01 In 2013, on the Settlement of Problems claims on behalf of the community of 8 (eight) Accompanied by NGO FMP Against Rural Land Covering an area of 60% of the 2100 Land Area of Ha Originating from Submission Brother Nana Suhendi As Manager PT. Brahma Bina Bakti / PT. Kirana Sekernan and Land Outside Licensing (Muaro Regent Decree No. 24 of 2011 and Decree of the Regent Muaro No. 25 of 2011). Conclusion: conform

6.5 Pay and conditions for employees and for employees of contractors always meet at least legal or industry minimum standards and are sufficient to provide decent living wages

6.5.1 Documentation of pay and conditions shall be available.

Major

There was Jambi Governor's decision no. 460 / KEP.GUB / DISSOSNAKERTRANS / 2015 dated October 30, 2015, concerning minimum wage of Rp. 1.90665 million. There are internal memo dated December 31, 2015, concerning the setting of wages. For daily casual worker was paid Rp. 76,270.- per day In samples taken showed that wages for casual daily labour, have been paid according to minimum wages of 2016, as examples: Anton Sudarwo and Suharti on payment in January 2016. Meanwhile, for the wages of permanent employees have not been adjusted and according to information from the company, it will be adjusted on the payroll in February 2016 Based on attendance data of casual daily labor on August 2015 until January 2016 and payroll of them, no of them have more than 21 days for 3 consecutive months. Conclusion: conform

6.5.2 Labour laws, union agreements or direct contracts of employment detailing payments and conditions of employment (e.g. working hours, deductions, Major overtime, sickness, holiday entitlement, maternity leave, reasons for dismissal, period of notice, etc.) shall be available in the languages understood by the workers or explained carefully to them by a management official.

Casual daily workers have been provided with employment agreement, as an example: Riyan Saputra, its contents have included the minimum wage in 2105. Working time and working hours are determined by the company. This contract has been signed by workers on October 17, 2015. The company did not keep the previous working agreement of permanent workers that has been working since the PT. Sakernan, and has not made new working agreement with them, as an example NIK 21/2121/0808/145, AN. NIK 21/2121/0709/278. This has been issued as observation no. 15

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Based on a sample letter of appointment of permanent employees no. 1101 / HR-BBB-S / X / 2015 and 1100 / HR-BBB-S / X / 2015, it was found that the letter did not mention the subject of working time, days off, the right to health etc. Nevertheless, it has been set on collective working agreement of 2014. This collective working agreement is applied only for permanent workers. Company should conduct socialization that people who are not tied the employment with the company is not allowed to work at the company's location. Based on interview with housewives, harvesters and supervisors, it is known that the wives of employees still allowed to assist the harvester picks fruit and harvesters also use labor from outside (helper) to collect the fruit during peak harvest. This has been issued as observation No.22 Conclusion: Observation No.14 and No.21

6.5.3 Growers and millers shall provide adequate housing, water supplies, medical, educational and welfare amenities to national standards or above, where no Minor such public facilities are available or accessible.

The company has been providing facilities and infrastructure for workers' welfare such as housing, clinics, place of worship, water towers, sports facilities and shuttle vehicles for students. As a follow up of the audit last year regarding minor nonconformities concerning the procurement of shuttle bus for school children, the company has added shuttle fleet. The Company currently has two school buses and three trucks which have been modified to carry students The Company can not ensure the continuity clean water supply for the workforce. Based on interviews with the occupants in Afdelling A, they experienced clean water shortage during the dry season and have to buy water for cooking / drinking. While for shower / washing they utilized the river adjacent to their housing facility. This has been issued as minor non conformity. Company has provided drilled wells for each Afdelling (A - H) and emplacement, but not all drilled wells have confirmed suitable to be used in accordance Permenkes 416 in 1990. In 2015 there was no examination of well water and now (2016), company was just delivered samples of well water of Afdelling E, H, B and C on 29 February 2016 to BLHD laboratory of Jambi Province. This has been issued as major non conformity. The company has made additional facilities such as elementary schools, ATM, G2 residential staff, employee housing G6 Conclusion: Minor No.16, Major No.35

6.5.4 Growers and millers shall make demonstrable efforts to monitor and improve workers’ access to adequate, sufficient and affordable food. Minor

The company has been providing employee cooperatives to provide basic needs for employees Conclusion: conform

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6.6 The employer respects the right of all personnel to form and join trade unions of their choice and to bargain collectively. Where the right to freedom of association and collective bargaining are restricted under law, the employer facilitates parallel means of independent and free association and bargaining for all such personnel

6.6.1 A published statement in local languages recognising freedom of association shall be available. Major

Freedom to form unions is set in the period 2012-2014 PP Preamble paragraph 2act 1. The Company has 2 units of union organizations, each for Estate Unit and POM Unit : 1) Estate Union (IPB3) (1). Estate union new board, formed on 13 March 2013, in accordance the official letter signed by Board IPB3 Election Committee and Chairman of PT. BBB. The management consists of Chairman: Edison Ependi, Secretary: B. Marpaung, and Treasurer: Rizal. In addition, there are nine board representatives in each unit Afdeliing (A - G), General, and Engineering. Formed Unions already registered and recorded according to SK Dept. of Manpower and Transmigration, Muaro Jambi, No. 560.6 / 09 / SP-SB / III / SOSNAKERTRANS, dated 3 / Mar / 2011, the corresponding letter No. 560.6 / 99 / Sosnakertrans, dated March 2, 2011, concerning Evidence Recording. The union called the Association of Workers of PT. BBB, address Suko Desa Jaya subdistrict Awin Sekernan, include unit: Division of Oil Palm Plantation, Plantation Rubber Division, and the Division of POM. Board consists of: Chairman (Edison Ependi), Vice Chairman (Syamsul A), Secretary (Command Tarin), Treasurer (Rizal), and the Chief Representative in Afdeling-section (as many as 13 officials). 2). All Indonesian Workers Union (SPSI) POM, authorized by decree regional Board of Unions Federation of Agricultural and Plantation SPSI Jambi Province, No. 12 / PD.F.SPPP-SPSI / JB / V / 2013 dated 05.17.2013 on Ratification / inauguration, Substitution Composition and Personnel Management in Work Unit Agriculture and Plantation Workers Union SPSI PT. Brahma Binabakti Unit mills with period 2013 - 2018. The Board consists of: Chair (Hambali Saiful), Vice Chairman & Secretary (SM.Silalahi), Deputy Secretary (Bonar Manalu), and Treasurer (Mispan). Amenities assistance of the company's trade unions in the form of: • Room for Workers' Union office is located in front of the BBB-Palm Estate, address: Jln. East Sumatera KM 54. Village SAJ RT. 12, and at the Mill. • Table chairs, • Also already formed Cooperation Institution (LKS) bipartite and has been ratified by decree Kadinsosnakertrans Muaro Jambi No. KEP.05 / LKB / XI / 2015 on Registration Bipartite Cooperation Institution PT. Brahma Binabakti Oil Palm Plantations, November 11, 2015. Likewise for Mill Unit (POM), has been formed EMC on November 5, 2015 and has been registered to the local Manpower No. KEP. 06 / LKB / XI / 2015 on Registration Bipartite Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 62of 114

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Cooperation Institution PT. Brahma Binabakti-POM. Related to the PKB, both IPB3 and SPSI had PKB, and is currently in the process of making PKB 2016-2018. Conclusion: conform

6.6.2 Minutes of meetings with main trade unions or workers representatives shall be documented. Minor

Records of meetings between the company and the union and internal union must be stored either in the unionsecretariat or in the function of the Secretariat of the PGA. There was evidence of recordings of meetings related to the activities of Unions, among others: • SPSI has been meeting every month one of them in November 2015 which discussed, , regarding the adjustment of the price of rice. • There is a monthly meeting notes IPB3 June 2015 concerning crop premium. There are inputs regarding premium adjustments harvest. Conclusion: conform

6.7 Children are not employed or exploited.

6.7.1 There shall be documentary evidence that minimum age requirements are met. Major

The Company has a policy on worker age requirement in accordance with applicable law. It is listed on: (1) Standard Operating Procedures Recruitment (01 / TAP-HRD / PSO-RF / III / 07) effective March 1, 2007, clause E.2, that the general requirements in recruitment is "at least 18 years old the time of admission ". (2). Memorandum Status & Improved Employee foreman to employee, no. 704 / HRD-IRR / XII / 11 dated 1/12/2011 about Subject Status and Appointment of Employees, in section B. Requirements Recruitment, item 1, aged 18 to 45 years. From the book Man Power Exist (MPE) of estate In January 2016, the date of birth of the youngest was in 1996. Conclusion: conform

6.8 Any form of discrimination based on race, caste, national origin, religion, disability, gender, sexual orientation, union membership, political affiliation, or age, is prohibited

6.8.1 A publicly available equal opportunities policy including identification of relevant/affected groups in the local environment shall be documented. Major

The Company has a policy of equal treatment and equal opportunities, as documented inthe company regulations of paragraph 10 and on SOP employee acceptance of item E. From the list of labor in the estate in January 2016, shows that the company has been recruiting Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 63of 114

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workers from various ethnic both local and non local, such as Jambi, Javanese, Batak, Palembang, Flores, Lombok, Lampung, Minangkabau, Sundanese, Nias, Chinese and Bugis. The majority of workers are male. Conclusion: conform

6.8.2 Evidence shall be provided that employees and groups including local communities, women, and migrant workers have not been discriminated Major against.

Based on data from the estate in January 2016, if it is assumed that the local community is the jambi’s people, so in the data also contained the Jambi’s people, although the majority of workers are Javanese and Batak. The migrant workers are not included in the note. Based on the record of the complaint as described in 6.3 there are no complaints about discrimination. Complaint that in union records are related school bus and sports facilities.

Conclusion: conform

6.8.3 It shall be demonstrated that recruitment selection, hiring and promotion are based on skills, capabilities, qualities, and medical fitness necessary for the Minor jobs available.

The company does not discriminate in the admission of new workers explicitly and in writing. Terms of hiring in general, among others: (a). Indonesian citizen, (b). The minimum age of 18 at the time of admission, (c). Healthy mind and body, (d). Meet the requirements of the position required (e) obedient to the company regulations and codes of conduct (f). Not engaging in banned organizations (g). Not bound working relationship with the other party Conclusion: conform

6.9 There is no harassment or abuse in the work place, and reproductive rights are protected

6.9.1 A policy to prevent sexual and all other forms of harassment and violence shall be implemented and communicated to all levels of the workforce. Major

The Company has established the Gender Committee of the Board on January 18, 2016 by the Senior Estate Manager. In carrying out its functions.The gender committee has work instructions. No. IK-01 / BBB / 2014.

Conclusion: conform

6.9.2 A policy to protect the reproductive rights of all, especially of women, shallbe

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implemented and communicated to all levels of the workforce. Major

The company has had a policy of not hiring pregnant and lactating women in the work of spraying, as stated in IK-12 / B-OIL / 2014 point 4. Not all female workers who work with chemicals conducted examinationof the pregnancy. This was raised as observation in 4.6.12

Conclusion: conform

6.9.3 A specific grievance mechanism which respects anonymity and protectscomplainants where requested shall be established, implemented, Minor andcommunicated to all levels of the workforce.

The Company has established a complaints procedure as contained in the Committee's work instructions for gender IK-01 / BBB / 2014., But have not included the anonymity of the reporting / reported from unauthorized parties. This has been issued as observation No.19

The company has been well socialized the complaints mechanism. Based on interviews with a workforce of sprayers in Afdelling A, it appears that women workers adequately understand the procedures for the submission of complaints concerning sexual harassment and domestic violence

The Company has documented and resolve matters related to sexual violence. This is evident from the record of the complaint dated January 17, 2015 regarding domestic violence. These complaints have been resolved on the same day with the peace between the two sides.

Conclusion: Observation No.18

6.10 Growers and mills deal fairly and transparently with smallholders and other local businesses.

6.10.1 Current and past prices paid for Fresh Fruit Bunches (FFB) shall be publiclyavailable. Minor Fruit price Rp. 1625. Prices of fruit known from the marketing via SMS (SMS evidence already available). The previous price was Rp. 1535 / kg. Pricing issues was appropriate and so far has been compared with other factory. Conclusion: conform

6.10.2 Evidence shall be available that growers/millers have explained FFB pricing,and pricing mechanisms for FFB and inputs/services shall be Major documented (wherethese are under the control of the mill or plantation).

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Pieces of FFB already socialized, but related with a piece of the dirt is between 40 kg to 80 kg. Empty bunch taken back by farmers and suppliers of fruit. Results effluent partly flowed into the plasma field according to the demand of farmers. Conclusion: conform

6.10.3 Evidence shall be available that all parties understand the contractual agreements they enter into, and that contracts are fair, legal and transparent. Minor

The Company has a list of suppliers of as many as 41 suppliers. The SPK was available. Payment is required 7 days after the invoice is received and the scales are appropriate. If the sortage is less appropriate, then the supplier switch it to another POM. The Company already has SPK with KUD Akso Dano (SPK No. 116 509 / BBB / PER-SK / V / 15) and the Supplier of FFB. Under these agreements, it has not contain penalties of agreement / cutting for trash and not appropriate pieces (for KUD). For supplier, it should be no garbage, but in its implementation there are cutting of pieces of 30-80 kg. it is also not in accordance with related IK (Acceptance Smallholder Fruit and Outside Fruit). At the ascertainment in the field, both the chairman and the secretary KUD were not understand the mechanisms in cutting FFB accordance to provision of Disbun and FFB supplier does not understand the cutting mechanism of garbage. This has been issued as minor non conformity. Conclusion: Minor No.27

6.10.4 Agreed payments shall be made in a timely manner.

Minor

The Company has a list of suppliers of as many as 41 suppliers. The SPK was available. Payment is required 7 days after the invoice is received and the scales are appropriate. If the sortage is less appropriate, then the supplier switch it to another POM. Conclusion: conform

6.11 Growers and millers contribute to local sustainable development wherever appropriate

6.11.1 Contributions to local development that are based on the results of consultation with local communities shall be demonstrated.

Minor

Company has given priority to local contractors. Type of work may include but not limited to: construction work, plant maintenance, road infrastructure construction/maintenance, water water channel, empty bunches transportation, FFB transport, housing development, place of worship, etc. Data of existing partners, supplier and contractor, shows that 16.2% of the Estate and Mill

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partners come from the area of Sekernan District, Muaro Jambi Regency.

Conclusion: conform

6.11.2 Where there are scheme smallholders, there shall be evidence that efforts and/or resources have been allocated to improve smallholder productivity. Minor

The realization of CSR 2013 and 2014 (up to August 2014) can be verified based on the report of realization of activities and evidence of implementation as well as the results of interviews during the stakeholders meetings on 9 September 2014. CSR activities are fully documented. CSR activities conducted are partly demonstrating the participation of PT. BBB in the construction and development of public facilities and social facilities in Sekernan District, Muaro Jambi Regency.

In the SIA report drawn up as per March 2013 there are 14 recommendations. 12 have been implemented, 1 is planned on 1 Dec 2014 of initiating a community panel and the remaining 1 which is not yet realized is to initiate the formation of ‘Social Learning Group'. All SIA recommendations have been incorporated in the Activity Plan of BBB CSR Program Kirana Sekernan 2014-2018. Recommendation No. 11 (K3 and employee’s social) is planned in the K3 activity plan.

PT. BBB develops a short term CSR program in the Annual Activity Plan (2014), and long term plan in the Strategic Plan of CSR program 2014-2018.

In its CSR activities, PT. BBB performs evaluation on a periodic basis. The result of interviews with Edi Susanto (SIA Dept.) indicates that the mechanism of CSR program evaluation is undertaken on an annual basis. The evaluation of CSR program 2013 has been conducted with related village community representatives.

In this activity need assessment is also conducted. The results of need assessment evaluation and the effectiveness of the activity became the basis for preparing the activity plan 2014.

Conclusion: conform

6.12 No form of forced or trafficked labour are used

6.12.1 There shall be evidence that no forms of forced or trafficked labour are used.

Major

In labor list, there was no migrant labor. There was no evidence the used of human trafficking

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and forced labor as workers.

Conclusion: conform

6.12.2 Where applicable, it shall be demonstrated that no contract substitution has occurred. Minor

Based on the observation to the contract with workers, workers were employed according to the contract Conclusion : conform

6.12.3 Where temporary or migrant workers are employed, a special labour policy and procedures shall be established and implemented. Major

Based on the observation to the contract with workers, there migrant workers employed in the plantation Conclusion : conform

6.13 Growers and millers respect human rights.

6.13.1 A policy to respect human rights shall be documented and communicatedto all levels of the workforce and operations (see Criteria 1.2 and 2.1). Major

The company has established a policy concerning human rights as stated in the preamble to the Manual TAP point 1 Conclusion: conform

7 RESPONSIBLE DEVELOPMENT OF NEW PLANTINGS

The Company has opened a new location with the management pattern of the smallhoder scheme: plasma 40%: Company 60%. The company conducted planting in 2011. The company already has a Location Permit No. 66 of 2014 of 6000 Ha and Plantation Business License Number 640 of 2013 of 3500 Ha. Total planted area are 641.44 Ha (227.78 Ha own estate and 413.66 Ha smallholder) and an area of 97.69 hectares will be land clearing in 2016, located in the District of Pemayung. Non conformity is issued because the company has not conducted such as: a. HCV Assessment b. SIA Assessment c. NPP Procedure This has been issued as Major Nonconformity No.29

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At the time of follow-up audit, the company has made the corrective action by conducting HCV Pemayung estate began land clearing in 2011, but HCV assessment just conducted in 2016. Land Use Change Analysis Reports for Pemayung estate is finalizing during follow-up audit. 1. HCV Assessment

The Company has not conducted HCVs management identification and it’s planning because HCV assessment report was just received when follow-up audit performed. The results of the peer-review HCV assessment results and overlay between HCV map and planting map area yet to be shown. Assessment conducted by HCV Team from BIOREF Faculty of Forestry, Bogor Agricultural University, and Dr. Ir. Nyoto Santoso, MS as a lead assessor. The scope of the assessment is in accordance with the permit area locations: 6000 ha. Results of the assessment are the area of Pemayung estate contained HCV 1, HCV 4, and HCV 6 with total area of HCVA 442,75 ha.

2. SIA assessment report

SIA assessment carried out by the Community Circle Oil (LINKS), led by Rudy L. Lumuru. Assessment was conducted on February 22, 2013 until March 11, 2013. SIA activities carried out at the villages around the plantation PT BBB PEMAYUNG, covering Kuap Village, Village of Senaning, Lubuk Ruso, Teluk, Teluk Ketapang, Ture, Pulau Betung, Selat, Lopak Aur, Olak Rambahan, Pulau Betung, Pulau Raman dan Village of Kaos.The whole villages are located in the district of Pemayung, Batang Hari, Jambi Province. At the time of the interview with the CSR Pemayung estate obtained relevant information that CSR program only provided help/support when there is a request for help from the nearby village community and not based on the recommendations written in the Social Impact Assessment. From sampling document, Its found the request from community of Kuap Village to repair the road. The Company has provided help/support with evidence of Official letter Heavy Equipment Support for Repairing the Road RT 05-06 Kuap Village. The repair is conducted on Friday, August 5, 2016 3. NPP Process NPP not yet conducted because it is still waiting for LUCA that on the stage of finalization of the report.

Conclusion : To be followed up with NPP process.

8 COMMITMENT TO CONTINUOUS IMPROVEMENT IN KEY AREAS OF ACTIVITY

8.1 Growers and millers regularly monitor and review their activities and develop and implement action plans that allow demonstrable continuous improvement in key operations

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8.1.1 The action plan for continual improvement shall be implemented, based on a consideration of the main social and environmental impacts and Major opportunities of the grower/mill, and shall include a range of Indicators covered by these Principles and Criteria. As a minimum, these shall include, but are not necessarily be limited to: • Reduction in use of pesticides(Criterion 4.6); • Environmental impacts (Criteria 4.3, 5.1 and 5.2); • Waste reduction (Criterion 5.3); • Pollution and greenhouse gas (GHG) emissions (Criteria 5.6 and 7.8);  Social impacts (Criterion 6.1); • Optimising the yield of the supply base.

The Company has conducted monitoring to the implementation of RSPO in the form of internal audit, which was conducted on December 15 to 19, 2015. Improvements which have been done among others were: the processing in the sterilizer has been controlled by a computer, the provision of elementary school and ATM.

Conclusion : conform

C.2.2 RSPO Supply Chain Checklist – Module E : CPO Mill Mass Balance Modul PT. Brahma Binabakti – Brahma Binabakti Mill E.3 Documented procedure E.3.1 The site shall have written procedures and/or work instructions to ensure the implementation of all the elements specified in these requirements. This shall include at minimum the following: a) Complete and up to date procedures covering the implementation of all the elements in these requirements; There was SOP of the tracking of FFB, CPO and PK models Mass Balance TAP / SOP / 120- DCC / 0002. The procedure stipulated that the supply chain system applied by the company was the mass balance. The procedure set that the mill received FFB from own estate, smallholdings, as well as outgrowers. There was also SOP to calculate and record certified FFB, CPO and PK in the procedure of TAP / SOP / 10-DCC / 003

Conclusion : conform

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b) The name of the person having overall responsibility for and authority over the implementation of these requirements and compliance with all applicable requirements. This person shall be able to demonstrate awareness of the site procedures for the implementation of this standard. There was internal decree no. 827 / HR-HRO / IX / 2014 concerning the appointment of traceability officer dated 01 September 2014. The personnel who was designated as traceability officer was Mill Manager Yopie Risnandar

Conclusion : conform E.3.2 The site shall have documented procedures for receiving and processing certified and non-certified FFBs. RSPO SOP of tracking of FFB, CPO and PK models Mass Balance TAP / SOP / 120-DCC / 0002 set that the suppy chain system applied by company was mass balance. The procedure set that the mill received FFB from own estate, smallholdings, as well as outgrowers. The record showed that the : - Total certified FFB, CPO, and PK in year 2015 as follows: CPO : 21,588.00 MT, PK : 5032.00 MT, FFB : 94,982.00 MT. - Total certified FFB, CPO, and PK in year 2016 as follows: FFB : 103,000.00 , CPO : 23,347.00 MT, PK : 3,805.00 MT

Conclusion : conform E.4 Purchasing and goods in

E.4.1 The site shall verify and document the volumes of certified and non-certified FFBs received. Procedure SOP RSPO tracking of FFB, CPO and PK models Mass Balance TAP / SOP / 120-DCC / 0002 set that the suppy chain system adopted by the Company is the mass balance. On the E model CPO Mill Mass Balance, the plant receives FFB from their own estates, smallholdings, as well as outgrowers. FFB from the certified estates (own garden) were identified using the manual stamp stated "certified" Conclusion : conform E.4.2 The site shall inform the CB immediately if there is a projected overproduction of certified tonnage. The organization has set up in the procedure of RSPO SOP regarding tracking of FFB, CPO and PK models Mass Balance TAP / SOP / 120-DCC / 0002 which sets out the model of suppy chain system adopted by the Company is the mass balance. The procedure set mill could receives FFB from own estate, smallholdings, as well as outgrowers. In case of overproduction (projected overproduction), as set in the point IV.19, the mill manager will

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inform the Production Control for follow-up to the certification body

Conclusion : conform E.5 Record keeping

E.5.1 a) The site shall record and balance all receipts of RSPO certified FFB and deliveries of RSPO certified CPO and PK on a three-monthly basis.

In 2015 the company has recorded the FFB reception both for certified ones and non-certified ones and balanced its sheet every 3 months. From the experimental data calculation Q1 2015 and the total for 2015, the calculation has been done properly. To calculate the CPO yield of FFB from own estates, the company has experimented split processing every month.

Conclusion : conform b) All volumes of palm oil and palm kernel oil that are delivered are deducted from the material accounting system according to conversion ratios stated by RSPO.

Based on the examination of the data in February 2016 and March 2016, CPO delivered both from certified and non-certified ones, have been deducted from the stock correctly according to the type of CPO delivered

Conclusion : conform c) The site can only deliver Mass Balance sales from a positive stock. Positive stock can include product ordered for delivery within three months. However, a site is allowed to sell short.(ie product can be sold before it is in stock.)

Mill is allowed to deliver the product before it is in stock as set in the procedure TAP/SOP/120-DCC/002 point IV.15

Conclusion : conform E.5.2 In cases where a mill outsources activities to an independent (not owned by the same organization) palm kernel crush, the crush still falls under the responsibility of the mill and does not need to be separately certified. The mill has to ensure that the crush is covered through a signed and enforceable agreement.

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There was neither outsourced process nor activities to the third parties Conclusion : conform

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D. 1. Statement by the Certifier Body on Behalf of PT. Sucofindo SBU-SICS

We, the undersigned declare that the information and conclusions included in this report have been prepared in accordance with rule and standard of RSPO, P&C, and that the certification decision has been based upon this information.

Verified and Reviewed by

Name Nuzwardy Sjahwil

Position Lead Auditor

Signature

Date Desember 2016

Technical Reviewer

Name Tuti Suryani Sirait

Position Senior Lead Auditor / Lead Auditor

Signature

Date Desember 2016

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APPENDIX - 1

List of Abbreviation

BBB Brahma Bina Bakti CPO Crude Palm Oil CSR Corporate Social Responsibility DOE Department of Environment EFB Empty Fruit Bunch EIA Environment Impact Assessment FFB Fresh Fruit Bunch FSMS Food Safety Management System GMP Good Manufacturing Practice GPS Global Positioning System HACCP Hazard Analysis and Critical Control Point HCV High Conservation Value HCVF High Conservation ValueForest HGU Hak Guna Usaha IEMA Institute of Environmental Management and Assessment IPM Integrated Pest Management IRCA International Register of Certified Auditor ISCC International Supply Chain Certification MOU Memorandum of Understanding MSDS Material Safety Data Sheet NA Not Applicable NC Non Conformity NCR Non Conformity Register OSH Occupational Safety and Health OSHAS Occupational Safety and Health Assessment Scheme P&C Principle and Criteria PK Palm Kernel PKO Palm Kernel Oil POM Palm Oil Mill

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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 SIA Social Impact Assessment

SIO Surat Izin Operator SOP Standard Operating Procedure

UKL Upaya Pengelolaan Lingkungan UPL Upaya Pemantauan Lingkungan WWTP Waste Water Treatment Plant WHO World Health Organization

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APPENDIX - 2

MAP

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APPENDIX- 3

Status of Non-Conformities Previously

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* Please send your response(s) to this Non Conformitie(s) + obs also in softcopy Non Conformity / Observation Report Audit 08-09-2014 (TSS, RQ, NM, NS, ) Organization No. No. Standard. Audit Date : RSPO 00005 2 (1) RSPO (Certification) ATL / Auditor :

……………………………………….(signature)

Organization Rep. :

……………………………………….(signature) Claus Audit Root Cause Corrective Action & Audit Team No. Category e Std or Description Investigation* Evidence* Review (1) (2) (3) (4) (5) (6) (7) (8) (9) 1 Observation 4.5 1 NM Data of the results of The construction of To carry out owl cage OPEN ->The inspection of rat attacks owl cages are not yet construction according to implementatio in August 2014 from done across the the work plan 2015 n will be seen fruit sorting at loading afdeling at the ramp shows 3.24%. surveillance Company should speed audit. up the construction of owl cages planned up to the year 2015 so that the rate of rat attack in the field can be reduced.

2 Observation 5.2 1 NM During a visit to the - The HCV-map is not - To combine plasma area OPEN ->The border of Putat Suak provided with plasma maps with those of PT implementatio River in the afdeling A area yet. BBB's HCV area n will be seen

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Block 5 the evidence of - Dissemination of - To carry out dissemination at the palm tree marking was information on the on the HCV area to plasma surveillance found in one part of the marking of palm trees farmers with respect to river audit. river in accordance with around the river border border area. the standard operating area has not been procedure while on the carried out to plasma other part next to it farmers. there is no mark found on palm tree because the plant belongs to the plasma area. The high conservation value map is preferably given an explanation about core area and plasma area and dissemination to the plasma of the marking of palm trees around the border of Suak Putat River.

3 Observation 4.1 1 RQ The SOP is already There is a mistake on The revised SOP Quality CLOSED - NS adequate to establish numbering SOP should be numbered POM- the targeted CPO Quality SOP/16 quality, one that become observation is that page 1 and 2 of SOP Quality have POM-SOP/01 written in them (owned by weighbrige) which should be numbered

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POM-SOP/16. 4 Observation 4.4 1 RQ Company needs to The measurement of To conduct measurement OPEN ->The ensure the downstream river of Kaos, Suak putat, and implementatio measurement of the water quality of Kaos, Mendahara river water n will be seen quality of water Suak putat, and quality regularly at the downstream of the Mendahara rivers is surveillance rivers of Kaos, Suak not yet carried out. audit. Putat, and Mendahara.

5 Observation 5.1 1 RQ Company needs to Mobile source To conduct mobile source OPEN ->The ensure the emission emission measurement for implementatio measurement of mobile measurement for heavy equipment. n will be seen source emission. heavy equipment is at the not yet carried out. surveillance audit.

6 Observation 5.3 1 RQ 1. Company disposes 1. Company does not 1. To follow up with RSUD OPEN -> The infectious waste to the yet make a follow up Abdul Manaf concerning implementatio RSUD Abdul Manaf on incinerator license the progress of incinerator n will be seen which has an at RS Abdul Manaf licensing. at the incinerator. Company surveillance needs to ensure that the audit. incinerator of RSUD 2. Employees are not 2. To conduct regular Abdul Manaf already yet informed about dissemination of has a license from the segregation of information to the Ministry of Environment garbage into organic employees on organic and 2. There garbage bins and inorganic garbage. inorganic garbage in the block H housing segregation. which are painted blue and labeled organics and non organics but in practice there is still garbage mixed of used

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food and drink plastic packaging, leftovers, leaves, and paper. 7 Observation 5.5 1 RQ Company does not yet Warning sign boards To create no burning of CLOSED - NS provide warning sign banning garbage garbage warning sign board banning garbage burning in residential boards. burning in residential area Blok H are not area, for instance in provided yet. block H residential area

8 Observation 5.6 1 RQ The company already A mid- and long-term To draw up a green house OPEN ->The makes a calculation of green house gas gas mitigation program with implementatio the efficiency of using mitigation program is respect to the use of diesel n will be seen sources that may not yet in place. fuel for genset, fiber for at the produce greenhouse boiler, etc. surveillance gas emission; it only audit. needs to make a calculation of the efficiency of the greenhouse gas substitutes for comparison, such as the efficient of diesel fuel use for genset after use of fiber for boiler fuel to generate the electricity. Company needs to make the medium and long term program of greenhouse gas source mitigation, such as a reduction in

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the use of genset in the estate if replaced by the source of electricity from the mill (the use of fiber in the boiler)

9 Minor 6.5.2 1 NS 1. In the contract of 1. Company has made 1. To ensure the certificate CLOSED - NS steam boiler overhaul arrangement with according to the regulatory work with PT. respect to the requirements for all Technindo Contromatra operators but not yet contractors. dated 28 April 2014; ensuring their regulatory requirements certificate as required such as welder operator by regulations.

requirements are not

seen to be included. 2. Internal memo 2. In the sampling of 2. To create a checklist for concerning Vendor SPK with Mr. Hutahuruk support in ensuring that Selection and with SPK number contractors have met the Appointment ((MI- 391/BBB-SAWIT/SPK- articles in concern. PRO-SITE/01/2014 011/MD/Proc/VI/2013) there is article 2 (Rights is already in place, but and obligations of the whether or not the parties); sub article 2.2 contractors has mentions the rights and satisfied the articles on obligations of the manpower, SMK3, contractor, sub article security and 2.2.d: comply with environment is not yet employment, SMK3, ensured. security and the environment. Company does not yet have a mechanism to ensure

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that contractors have fulfilled that article.

10 Observation 6.5.3 1 NS It is recommended that Dissemination of To redisseminate sexual CLOSED - NS the Committee intensify information on gender harrasment reporting the dissemination of committee has been procedures to the complaints procedures. implemented, but not employees. From the results of all employees know interviews the female how to report sexual sprayer’s workers in harrasment. afdelling D do not seem to understand the complaint procedures.

11 Major 6.5.2 1 NS In the sampling of Mr. There is an agreement HRD - HO produces an Closed. Kirenius Tampubolon between the employer internal memo to BBB - Mill Corrective on his overtime hours of and workers but not in to follow overtime hours action has 82.5 per month, this is a compliance with the according to the regulations been adequate non conformity since regulations. as per 12 September 2014 by issuing an overtime hours are at internal memo maximum 14 hours a concerning week. Although it does limitation on not conform to overtime and regulatory provisions of written Law 102/MEN/2004, but statement on company has had an the overtime agreement with the agreement. Union at the mill on 01 January 2014 to allow working overtime more than that set in the laws and regulations.

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12 Observation 4.7.4 1 NS Training of class D has Application letter for To follow up with PJK3 CLOSED - NS been planned to be fire mitigation training concerning the conducted in class D has been sent implementation of training September – to PJK3, but the in fire mitigation class D. December, but not yet training has not yet carried out. The been implemented, organization should waiting for a fixed apply for such training schedule. to related PJK3.

Currently, company already has a fire fighting personnel (class C).

13 Observation 4.7.1 1 NS Because the P2K3 A competent PIC as To select a competent PIC CLOSED Secretary is not always P2K3 Secretary on the as P2K3 Secretary through present, a new AK3 site is not yet conducting AK3 training. working on the site available. should be appointed and trained.

14 Observation 2.1.2 1 NS Changes to the Changes in the P2K3 To report the changes in CLOSED structure of P2K3 organization structure P2K3 structures to local should be reported to have not been Manpower Service. the local Manpower reported yet to the Service. local Manpower Service. 15 Minor 2.1.2 1 NS The appointed P3K Existing P3K officer To apply for P3K officer CLOSED officer does not yet has obtained a P3K license to local Manpower have a license from the competency certificate, Service. local Manpower Service but not yet obtaining a as required in license from local

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Regulation of the Manpower Service. Minister of Manpower 15/MEN/2008.

16 Observation 6.3.1 1 NS It is advisable that the Employee grievances To record employee CLOSED. Unions records have been submitted grievances on employee employee’s complaint through the Unions grievance form. submitted to the Unions during the LKS Bipartit meeting, but not yet recorded on employee grievance form. 17 Minor 6.5.3 1 NS 1. In the afdelling H is 1. A bathroom and 1. To build a bathing and MAJOR -> in not yet provided with a washing room for the washing facility for spraying the ASA I still facility for the spraying spraying workers have workers at Afd. G found : In workers to wash their been made available 2015 there work clothes and take a at the central 2. To renovate and monitor was no bath considering that Warehouse, but not the progress of public examination the central warehouse yet provided for at the bathroom & toilet and TPA of well water is faraway (1.5 to 2 Afd. H repairing. and now hours trip) 2. Public bathroom & 3. To ensure that E.Coli (2016), 2. Employee housing in toilet and TPA are in parameter is included in the company afdelling H is G10 type the repairing process. testing of bore well clean was just housing (10 water. delivered accommodations). Each 3. Bore well water samples of is not provided with quality has been well water of bathroom and toilet. tested, but E. Coli Afdelling E, Toilet is provided parameter is not yet H, B and C outside the house but it included. is out of order. on 29 February 3. The toilet and 2016 to bathroom in the daycare BLHD

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in afdelling H are out of laboratory of order Jambi Province 4. Company already has a bore well for the worker housing in afdelling H. Company has conducted tests to the water but the tests did not include e.coli parameter. Company has submitted a letter to UPT Laboratory of Jambi Area for water test according to Regulation of the Minister of Health No. 492/MEN/2010

18 Minor 8.1 1 NS Company is not yet Company is already To perform a regular and CLOSED -NS effectively performing a performing a regular detailed K3L inspection for precautionary measure K3L inspection, but not areas with high risk over potential yet in detail for areas potentials, and to remedy nonconformance, of high risk potentials. abnormal conditions. among others this can be seen on the seals of silencer connection and the latch of boiler door which at the time of audit was damaged.

19 Major 1.1 1 TSS 1. SOP has not made a No letter response 1. To revise Information Closed. category of types of time is provided and Request SOP by making Company has

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letter that need and do there is a mistake in categories of types of letter revised the not need a reply. In the archiving system. that need and do not need related implementation thereare a reply, as well as response procedure types of letter such as time to an incoming letter. (106181/TAP/ invitation letter, 2. To retrain officers PRO–CSR– notification letter, performing a task of HO/VI/13 circulars from receiving and handing over Revision: 01) government/non- incoming letters & outgoing and delivered government agencies letters. training/inform that need no reply. ation dissemination 2. Sampling of an of the incoming letter from procedure to Internal Futsal relevant Management, dated 08 parties. January 2014 and replied by the company through a letter number 02/BBB- PKS/SKR/1/2014 regarding requests for Futsal Field Lighting assistance. The incoming letter was found not to be archived in the incoming letter file. The outgoing letter has been given to relevant stakeholder but not date is available indicating when the letter is delivered so that it cannot be

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determined whether the response time limit conforms to provisions of the SOP.

20 Observation 3.1 1 TSS 1. Company already 1. Company has in 1. To correct the existing OPEN ->The has a long term place a long term long term projection by implementatio projection (blue print) projection, but the taking into account n will be seen 2013-2036. The data OER CPO valuation changes in the annual at the does not show a trend does not take into increase of OER value. surveillance of rise in OER CPO account changes in audit. from 2014 – 2036. The annual increase. 2. To schedule plasma OER is flat at 23%. It is (cooperative) certification. recommended that 2. Certification company reviews the schedule has been in OER target so that place, but it is not yet there is a rise in OER incorporating the trend to show a schedule for plasma continual improvement. (cooperative) certification. 2. It is recommended that the proposed certification process of cooperative Akso Dano and cooperative Dano Bangko is incorporated in the company’s long term plan (Blue print) according to the RSPO certification system requirements.

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21 Minor 6.10.1 1 TSS Relating to the 1. Grading 1. To conduct grading for OPEN ->The provisions that all implementation for fruit external fruit in accordance implementatio parties understand the from outside and not with grading work n will be seen terms and conditions of covered in the SPK is instruction for fruit from at the the contract and the not yet determined. outside and not covered in surveillance contract must be fair, 2. Company is not yet SPK audit. valid and transparent. A ensuring if 50 kg dirt 2. Company is to perform a nonconformity was deduction has comparative analysis found as follows: complied with (calibration) to see that 50 government provisions kg dirt deduction has 1. In the SPK between stating that the penalty complied with government the company and a for dirt is 2 x dirt provisions stating that the supplier, sampling is weight. penalty for dirt is 2 x dirt done to Mr Ahmad weights. Sunaryo, Asiong (Filipus Hunadi Setiadi) and Mr. Robinson Pardede. FFB sampling discovered 1. 5% deduction of the total of FFB tonnage not listed in the SPK.

2. In the plasma farmer receipt there is a deduction for dirt 50 kg each truck. This cannot be ascertained if this dirt deduction conforms to the government provisions of Grower Produced Oil Palm Fresh Fruit Bunches

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Pricing Guidelines No. 14/Permentan/OT. 140/2/2013 stating that penalty for dirt is 2 x dirt weight.

22 Major 1 TSS SCCS Edition 25 Job desc is not yet 1. To add new job desc for Observation- November 2011 – available for work units MM, KTU, Ass. Logistik, The Module E – CPO Mills : other than mill Marketing HO, PC, Krani implementatio Mass balance – Major manager and the Timbang n will be seen system is not yet well 2. To revise SCCS SOP for on the next 1. Job description of understood in the case sell short cases. surveillance other functions with duty of sell short. audit. and responsibility Company has related to the improved the implementation of SCC procedures in the company has not (FFB, CPO & been found, for instance PK) logistics, head office sales. So far the Model Mass company just has job Balance) and description and completed the designation for Mill Job Desc of Manager. related personnel. 2. Observing field implementation, in terms of database it is not yet determined in the case of sell short process.

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23 Minor 6.1.4 1 TSS Company already has a MOUs are already Company will arrange for OPEN ->The MOU with cooperative present, but the addendum of obsolote implementatio Akso Dano for plasma 1 addendum with MOUs. n will be seen and plasma 2. An respect to the obsolete at the expired MOU has been MOUs is not yet surveillance found i.e. the MOU carried out, and they audit. between the company are not yet and Cooperative Akso incorporating Dano entered into on 6 grading/penalty February 1995. This methods MOU says that the MOU will terminate when the credit with Bank BNI has been paid (article 15, page 6). Addendum/revision of the MOU is not found. Cooperation Agreement document between company and cooperatives (plasma 1 and 2) which regulates the method of grading/penalty, payment and other things that need to be mutually agreed is not found.

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Non Conformity Register ANNUAL SURVEILLANCE ASSESMENT (ASA) I

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No Claus Root Cause Corrective Action & Audit Team . Category e Std Auditor Description Investigation* Evidence* Review (1) (2) (3) (4) (5) (6) (7) (8) (9) 1 Minor 2.1.3 RS The Company has not Open PO HDY evaluate the compliance with laws and regulations regularly. By sampling, it was found that compliance with Ministry of Public Work and Public Housing RegulationNo. 37 / PRT / M / 2015 on approval of use of water and / or water sources, dated July 24, 2015 has not been evaluated. 2 Observation 2.1.1 RS HDY The Company has Open PO permit retrieval of the river water that is not valid. Currently the company is working on the arrangements of license renewal decision of Sekawan river based on the receipt document dated March 11, 2015 from Sumatra BWS VI. 3 Major 4.4.2 RS HDY The Company has not There has been no Perform maintenance Observation, PO made an effort for activity to maintain the efforts by planting trees the maintaining the water water of Sekawan River implementatio source of Sekawan n will be seen River where the water on the next was used by the ASA company

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4 Major 4.4.1 RS HDY The company could not There was no water Arranging permit from the Observation, PO show the surface water uptakes permit license relevant agencies. The the realization uptage permits for the for the use of process that has been will be seen in entire estate. By groundwater in Afdeling done were SPPL permit, the next ASA sampling, there was no conducting further water SIPA permit for test for licensing at the groundwater wells in Department of Energy section H. and Mineral Resources 5 Major 4.4.2 RS TSS/NR Based on the results of There are There is a Letter of Observation, PO field visit to Afdeling E recommendations for Approval from the the realization field in the D6 block, and HCV assessor which will be seen in Environment Agency the provisions set forth determined the riparian the next ASA in the company's zone 20 m wide left and Muaro Jambi No: 660.4 / internal memo PT TAP right of the river, 36 / BLH.3 / 2016 dated 4 number MI-004 / MD / April 2016 on the approval Sust / XI / 2012 dated of the results identification 12 November 2012 regarding conservation of HCV conducted by of riparian of river and team of Faculty of water Reservoir Water Forestry, Bogor

Agricultural Institute Company based on recommendations from the HCV assessor has set a riparian zone as wide as 20-meters from the river side or the same distance with space between 2 palm trunks as HCV4. This is not in accordance with applicable laws and regulations (including PP No. 38 of 2012 on the River)

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6 Observation 4.4.1 RS HDY Laboratory analysis OPEN PO result of the well for clean watershould be appropriatewith Permenkes no. 416 and equipped with testing of E Coli’s parameters

7 Minor 5.3.3 RS HDY In section H of pesticide Open PO management in rinse house on its use has not been found contaimen secondary and effluent control at rinse housetanks 8 Observation 4.7.3 RS HDY Fire training is Open PO necessary to ensure the realization of level A, B C and P3K also its implementation in accordance with the scheduling agenda in 2016. The company data indicated that there was no training in 2015.

9 Minor 5.1.2 RS HDY The documentation Open PO DELH showed that all activities of the mill has not been identified aspects such as the impact of land application activities and sanitation activities that

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produce domestic waste.

10 minor 5.1.3 RS HDY Monitoring of domestic Open PO waste in accordance with LH Decree no. 112 of 2003 has not been made by the company

11 observation 5.3.3 HDY The Company should Open ensure the implementation and documentation of the entire program and long- term targets in order to reduce domestic solid waste, reduction of emissions and a reduction in water use. The efforts should be monitored and measured. 12 Observation 4.7.5 HDY Emergency response Open equipment such as water tanks in the estate section H was not adequate and standby at the site.

13 Minor 4.7.6 NS Not all labor followthe the company already set Observation,. social security programs the regulation stating that The as provided in all employees will be implementatio Regulation 84 in 2013. registered to full packet of n of regulation Casual workers only BPJS ketenagakerjaan will be receive protection in the and BPJS kesehatan checked form of work accident during the next

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insurance (JKK) ASA anddeath benefit (JKM) and does not include Retirement Security (JHT), pensions and health Insurance (data in the form of casual worker paycheck ID No. 21/2121/0812/759, and 21/2121/0812/757 month of December 2105 and January 2016 14 Observation 6.5.2 NS The company should Open make a new worker agreement for permanent workers who have been working since the PT. Sakernan, From the results of the documents, there was long-time permanent worker that have not been renewed its agreement as an example NIK21/2121/0808/145 and NIK 21/2121/0709/278.

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15 observation 6.3.1 NS The grievance Open procedure SOP (AP- MPR / HRD-GM / 063- 0113-0, 01/18/2013) should add article / item concerning custody secret of the complainant identity.

16 MINOR 6.5.3 NS Clean water supply for Open labor can not be ensured the continuance. In interviews with the occupants in Afdelling A, theiy were lack of water during the dry season and have to buy water for cooking / drinking. For the need of a shower / wash , they were using the river near the housing and can not be ascertained that the water is the category of clean water. 17 Observation 4.6.12 NS Open It is advised that company to be more persistent in conducting pregnancy test to all female workers who work with chemicals. Female worker in afdelling A, G, H have

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not been examined for pregnancy.

18 Observation 6.9.3 NS The instruction of Open complaints of sexual harassment IK-01 / BBB / 2014., There should be an instruction to maintain the anonymity of the reporter or reported from unauthorized parties.

19 Observation 4.6.5 NS Mandor / Foreman Open should carry a spare of easily damaged PPE such as rubber gloves. From the field observations, there were sprayers that use rubber gloves that had been torn and the workers did not replace it because the worker did not bring the spare. 20 Observation 4.6.5 NS Company should re- Open evaluate the use of anti- pollution fabric mask for the sprayers because in fabric mask is not mentioned that it can filter out chemicals C3H8NO5P / Phosphomethyl glicin) (IPA) and metsulfuron methyl. That materials is used for weed control.

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21 Observation 6.5.2 NS Company should Open conduct socialization that people who are not tied the employment with the company is not allowed to work at the company's location. Based on interview with housewives, harvesters and supervisors, it is known that the wives of employees still allowed to assist the harvester picks fruit and harvesters also use labor from outside (helper) to collect the fruit during peak harvest. 22 Minor 1.1.1 TSS Related with the Open provision of information to stakeholders, the relevant SOP and assurance in the field has not been stated: a. Frequency stakeholders updated list. b. There has been no appointment letter from the company to the personnel responsible for providing information c. There has been no determination of the type / level of information provided to

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stakeholders. d. There has been no SOP governing the dissemination / sharing of such information. 23 Observation 1.1.2 TSS Related the provision of Open a response to the stakeholders, it should be : a. Ensuring the officer who gave the answer, because in the SOP item 4.3.3 there are some responsiblepersonnelsb ut from Job description it is only Assistant CSR. b. There was still confused of information over when providing information. SOP point 4.5 stated that the administration approved the information provided within a maximum of 5 working days. For the types of information that are not approved will be given an answer within a maximum of two working days. In points 4.8.4 declare any incoming mail requires a response no later than 14 working days. 24 observation 1.2.1 TSS a. list of information that Open can be accessed in

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public (SOP No. 106 181 / TAP / PRO-CSR- HO / VI / 13) has not complete yet as required under RSPO standards such as the concession, Complaints & Grivience Procedure, Negotiation Procedure, Continues improvement, Public Summary of the Certification audit report, and Human Rights Policy. b. Company do not have a website so the stakeholders can not have access to information related to PT. BBB. c. The Company has not disseminate type of relevantinformation and can be accessed by all relevant partiesto the stakeholders. 25 Observation 2.3.2 TSS Related the Open compensation against Mr. Pajrin located in section E Block E1.3, a. Preferably in the procedure include the requirement to map- making that comes with the title, legend, scale and coordinate points. b. In the official-making

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letter of measurement has not completed the signature of the village officials. c. At the time the process of compensation, official letter was not available. 26 observation 2.3.3 TSS There was a Open relinquishment of rights letter between the company and claim maker; Mr. Pajrin dated February 11, 2014. The relinquishment of rights agreement was made in 3 pieces. The legality should be determined because there are no initials on each of the sheet and also signatures of the witnesses made in a separate page. 27 Minor 6.10.3 TSS The Company already Open has SPK with KUD Akso Dano (SPK No. 116 509 / BBB / PER- SK / V / 15) and the Supplier of FFB. Under these agreements, it has not contain penalties of agreement / cutting for trash and not appropriate pieces (for KUD). For supplier, it should be no garbage,

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but in its implementation there are cutting of pieces of 30-80 kg. it is also not in accordance with related IK (Acceptance Smallholder Fruit and Outside Fruit). At the ascertainment in the field, both the chairman and the secretary KUD were not understand the mechanisms in cutting FFB accordance to provision of Disbun and FFB supplier does not understand the cutting mechanism of garbage. 28 observation 6.1.3 TSS Related to the SIA, Open should be ascertained: a. Ensuring relevant agenda has been realized or not in the plan and the realization of CSR b. Make sure their efforts to improve the welfare of communities (Community Development)

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29 Major 7 RS TSS The Company has a The area is a Corrective actions have To be followed PO new plantation sites partnership of land. In been made up with NPP under scheme the areas of the 1. Assessment of HCV process smallholder partnership, there is a 2. Assessment SIA management with ratio sharing are for main company and plasma: estate and plasma For FFB that were not 40%: 60%. estate that supporting included in the criteria of assessment for certified FFB (Non CSPO) The company conducted certification has not planting in 2011. The been conducted company already has a Location Permit No. 66 of 2014 of 6000 Ha and Plantation Business License Number 640 of 2013 for an area of 3500 Ha. Land that has been planted was 641.44 ha (227.78 ha for company and 413.66 Ha for plasma). An area of 97.69 hectares which will be cleared in 2016, is located in the Sub district of Pemayung. There are nonconformities in which the company has not done: a. HCV Assesment b. SIA Assesment c. NPP Procedure 30 Observation 2.2.5 TSS Map making land in Open conflict should be equipped with coordinate data and a scale of 1: 10000,

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a) At the completion of compensation to Mr. Fajrin, the map does not include the scale and point coordinates. b. In SOP No. 002 / TAP / PRO-CSP-HO / IV / 10 field measurements need to be equipped with a scale. 31 minor Partial TSS Timebound: Open certific a. Company does not ation have a detailed plan related to the proposed Certification Plasma 1, 2 and 3. b. When assurance to the KUD, Information was obtained that socialization / training is merely the best practices and has not related to the preparatory activities of Plasma Certification. 32 Major 2.1.1 RS RB There are areas of the There were no Create reports about Observation PO plantation located in the information regarding description of the map to forest area with an area planting area in the the area of 785 Ha of 785 hectares (No. location of Forest Area SK.727 / Menhut-II / During follow-up audit, the 2012). auditor verifies the corrective actions by the company. Ministry of Forestry and Environmental issued Letter No. No. SK 727 / Menhut-II / 2012

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explained that 785 ha are as forest area. PT. Brahma Binabakti sent a letter with Number 118875 / BBB / SKR-R01 / II / 16 on February 25, 2016 explained that area was an area of other use (APL) based on RTRWP Jambi 1993. In that letter also requested that the company's total forest area of 785 ha on the SK 727 / Menhut-II / 2012 should be amended accordance with RTRWP Jambi in 1993, which is area of other use (APL). The letter has been received by the Ministry of Environment and Forests with a receipt, stamp and signature on the copy of the letter. Progress will be seen in the next surveillance audit.

33 Major 2.2.1 RS RB There are areas of There is a plasma within Arranging activity plan Observation PO plasma that has been the concession area of regarding plasma land planted which located in PT BBB within the concession the concession. It is uncertain where the land At the time of follow-up is, and this is because audit, the Company has the company has not provided a location been able to show a map of the plasma area map of the location of covering 189 ha. the land (Block) and its

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range. Smallholder is located in the village of Bukit Baling, District Sekernan, Batang district included into the concession area No. 2 and 3. The company states that in 2017 will propose a reduction in the concession area which is plasma at the time of filing the extension of the concession. 34 Observation 2.2.1 RB The Company has not Open had the concession for an area of 6000 hectares (planted area = 641.44 ha and 97.69 ha LC) located in District Pemayung. Currently The location permit(No. 66 of 2014)and the Business License Plantation-Cultivation (Number 640 of 2013) is on process.

35 Major 6.5.3 NS In 2015 there was no The Company has not The Company has been Observation, (previous examination of well conducted testing of conducted sampling and the audit was water and now (2016), water samples in the result of test in consistency minor) company was just Afdeling in accordance Afdeling B,C,E and H will be delivered samples of with Permenkes 416 were available. checked in the well water of Afdelling E, 1990, and its results next ASA H, B and C on 29 were not available for Well water of afdelling E February 2016 to BLHD Afdeling B, C, E and H and H has beent

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laboratory of Jambi examined on 01 March Province 2016

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