IOI Corporation Berhad
RSPO Membership No: 2-0002-04-000-00
PLANTATION MANAGEMENT UNIT Pukin Grouping Rompin & Maudzam Shah (Pahang), Segamat & Tangkak (Johor), Malaysia
INTERTEK CERTIFICATION INTERNATIONAL SDN BHD (188296-W)
Report No.: R2020/10-4 IOI Corporation Berhad Pukin Grouping Page 2 of 48 Annual Surveillance Assessment (ASA-03) cum Extension of Scope
ANNUAL SURVEILLANCE ASSESSMENT (ASA-03) cum EXTENSION OF SCOPE ON RSPO CERTIFICATION
ASSESSMENT REPORT
IOI CORPORATION BERHAD
RSPO Membership No: 2-0002-04-000-00
PLANTATION MANAGEMENT UNIT Pukin Grouping Rompin & Maudzam Shah (Pahang), Segamat & Tangkak (Johor), Malaysia
Certificate No: RSPO 927888 Issued date: 13 Jun 2012 Expiry date: 12 Jun 2017
Assessment Type Assessment Dates Initial Certification (Main Assessment) 8-11 Dec 2010 Annual Surveillance Assessment (ASA-01) 5-9 Nov 2012 Annual Surveillance Assessment (ASA-02) 22 – 26 Apr 2013 Annual Surveillance Assessment (ASA-03) 08-11 Apr 2014 Annual Surveillance Assessment (ASA-04) Re-Certification
Intertek Certification International Sdn Bhd (formerly known as Moody International Certification (Malaysia) Sdn Bhd) 6-L12-01, Level 12, Tower 2, Menara PGRM No. 6 & 8 Jalan Pudu Ulu, Cheras, 56100 Kuala Lumpur, Malaysia. Tel: +00 (603) 9283 9881 Fax: +00 (603) 9284 8187 Email: [email protected] Website: www.intertek.com
Intertek RSPO Report: May 2014
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TABLE OF CONTENTS
Section Content Page No 1.0 SCOPE OF ANNUAL SURVEILLANCE ASSESSMENT (ASA-03) cum EXTENSION OF SCOPE 1.1 Introduction 4 1.2 Location (address, GPS and map) mill, estates and hectarage 4 1.3 Description of supply base (fruit sources) 5 1.4 Year of plantings and cycle 6 1.5 Summary of Land Use – Conservation and HCV Areas 7 1.6 Other certifications held and Use of RSPO Trademarks 7 1.7 Organizational information/contact person 7 1.8 Tonnages Verified for Certification 8-9 1.9 Time Bound Plan 10 1.10 Abbreviations Used 10 2.0 ASSESSMENT PROCESS 2.1 Assessment Methodology, Plan & Site Visits 11 2.2 Date of next scheduled visit 11 2.3 Qualifications of the Lead Assessor and Assessment Team 11 2.4 Certification Body 11 2.5 Process of Stakeholder consultation 12-13 3.0 ASSESSMENT FINDINGS 3.1 Summary of findings 14-41 3.2 Status of Identified Noncompliance and Corrective Actions, Observations and 41-44 Identified Positive Elements 3.3 Summary of Feedback Received from Stakeholders and Findings 44-45 4.0 ASSESSMENT CONCLUSION AND RECOMMENDATION 4.1 Acknowledgement of Internal Responsibility and Confirmation of Assessment Findings 46
4.2 Intertek RSPO Certification Details for Pukin Grouping 47-48
APPENDICES Appendix Page Appendix A Qualifications of the Lead Assessor and Assessment Team 1 Appendix B Assessment Plan 2-3 Appendix C Maps of location – Mill, Estates, Conservation and HCV areas 4-12 Appendix D Photographs of Assessment findings at Pukin Grouping 13 Appendix E Time Bound Plan for Other Plantation Management Units 14
Intertek RSPO Report: May 2014
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1.0 SCOPE OF ANNUAL SURVEILLANCE ASSESSMENT (ASA-03) cum EXTENSION OF SCOPE
1.1 Introduction This Annual Surveillance Assessment (ASA-03) cum Extension of Scope was conducted on the Plantation Management Unit (PMU) Pukin Grouping of IOI Corporation Berhad (hereafter abbreviated as IOI), from 8-11 Apr 2014 , to assess if the organization’s operations of the mill and its supply bases were in compliance against the RSPO Principles and Criteria (Apr 2013), Malaysian National Interpretation (Nov 2010) and the RSPO Supply Chain Certification Standard (Nov 2011) for Palm Oil Mill. This assessment also includes a review of the changes made by the PMU to comply with the requirements of the ratified new RSPO Principles and Criteria (effective 25 Apr 2013). It was found that the PMU is aware of the new RSPO Principles and Criteria and the transition period for compliance but has not yet make the necessary changes required.
The Extension of Scope is to include 3 estates (viz., Leepang A Estate, Laukin A Estate and Bukit Serampang Estate), previously under other certified IOI PMUs, into the Pukin Grouping.
The plantation management unit (PMU) or management unit is equivalent to a certification unit as defined in the RSPO Certification Systems Document. Each PMU consists of one mill and its supply bases which are made up of estates owned by IOI Corporation Berhad
1.2 Location (address, GPS and map) of palm oil mill and estates Pukin Grouping consists of 1 palm oil mill, namely Pukin Palm Oil Mill and 7 estates as indicated in Table 1 below, which includes the addresses and GPS locations of the mill and estates. The location maps are provided in Appendix C.
Table 1: Address of Palm Oil Mill, Estates and GPS Location GPS Reference Name Address Latitude Longitude Pukin Palm Oil Mill 30km, Lebuhraya Tun Abdul Razak, Keratong, Rompin, 02° 43’07.9” N 102° 54’28.7” E Capacity (60 mt/hr) Pahang
30km, Lebuhraya Tun Abdul Razak, Keratong, Rompin, Pukin Estate 02° 43’07.9” N 102° 54’28.7” E Pahang
30km, Lebuhraya Tun Abdul Razak, Keratong, Rompin, 02° 47’58.5” N Shahzan 1 Estate 102° 50’56.3” E Pahang 36km, Lebuhraya Tun Abdul Razak, Keratong, Rompin, 02° 48’59.6” N Shahzan 2 Estate 102° 52’26.5” E Pahang 02° 29’22.0” N Segamat Estate Km 5, Jalan Segamat Muar, 85009 Segamat, Johor 102° 52’58.5” E
KM 68, Kuantan-Segamat Highway, 26700 Muadzam Shah, Leepang A Estate 03°00’36” N 103°01’48” E Pahang. KM 72, Kuantan-Segamat Highway, 26700 Muadzam Shah, Laukin A Estate 03°01’26” N 103°02’33” E Pahang. Bukit Serampang KM 12, Jalan Sagil-Tangkak, Segamat, 84900, Tangkak, 02º19’53.65” N 102º41’17.37” E Estate Johor.
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1.3 Description of supply base (fruit sources)
The supply base i.e. FFB sources to the POM at Pukin Grouping PMU are from the abovementioned 7 estates which are owned by IOI Corporation Berhad. Verification done on site during the Annual Surveillance Assessment (ASA-03) cum Extension of Scope confirmed that there were no outgrowers / independent suppliers / smallholders involved in the supply of FFB to the said PMU. However, Pukin Grouping has included 3 additional estates (previously certified under different PMU) into the Pukin Grouping since the last assessment and these estates were audited during this assessment.
Details of the planted hectarage for the FFB supply for Pukin Grouping are as shown in Table 2 below.
Table 2: Estate Area Summary – 2013 / 2014
Area Summary (ha) – 2013 / 2014 Estate Certified Area Planted Area Pukin Estate (Assessed in ASA-01 and ASA-02) 2,437.26 2,188.00 Shahzan 1 Estate (Assessed in ASA-02) 1,562.95 1,517.00 Shahzan 2 Estate (Assessed in ASA-02) 1,640.77 1,602.00 Segamat Estate (Assessed in ASA-01) 1,921.62 1,779.00 Leepang A Estate (Assessed in ASA-03) 2403.70 1,829.00
Laukin A Estate (Assessed in ASA-03) 1,619.90 1,051.00
Bukit Serampang Estate (Assessed in ASA-03) 2,564.46 2,558.00 Total: 14,150.66 12,524.00 Percentage: 100% 88.50% Notes: 1. This Annual Surveillance Assessment (ASA-03) cum Extension of Scope covered the overall land use for oil palm plantation areas, and the identified Conservation areas including HCV areas marked out at the estates. 2. The estates sampled for this Annual Surveillance Assessment (ASA-03) cum Extension of Scope have been selected based on their potential risks on social, environmental and biodiversity issues such as their proximity to forest reserves, hill sides, riparian zones and high conservation value areas.
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1.4 Summary of plantings and cycle The 7 estates been developed beginning from 1988 and 2010 and are in the 2 nd cycle of planting. The age profile is as shown in Table 3.
Table 3: Age Profile of Planted Oil Palm 2013 / 2014
Mature OP (ha) Immature OP (ha) Estate Name Year of Planting Cycle of Planting – Above 3 years – 3 years & below 2007-2010 2nd 1. Pukin Estate 2004-2007 2nd 2,188 0 1994-2003 1st 2. Shahzan 1 Estate 2003 1st 1,517 0 3. Shahzan 2 Estate 2002-2003 1st 1,602 0 2013 2nd 2004-2006 2nd 4. Segamat Estate 1,660 119 1994-2003 2nd 1989-1993 1st 2002 1st 5. Leepang A Estate 1,829 0 2001 1st 6. Laukin A Estate 2002 1st 1,051 0 2011-2012 2nd nd 7. Bukit Serampang 2007 2 2,462 96 Estate 1999-2002 2nd 1993-1998 1st Total 12,309 215
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1.5 Summary of Conservation and HCV Areas The summary of Conservation and HCV Areas as identified in Pukin Grouping during this Annual Surveillance Assessment (ASA-03) cum Extension of Scope in 2014 is as shown in Table 4 below:
Table 4: Conservation and HCV Areas
# Statement of Land Use (Ha) 2012 / 2013 2013 / 2014 (Annual Surveillance (Annual Surveillance Assessment ASA-02) Assessment ASA-03) Hectarage – Ha Hectarage – Ha 1 Planted Area (ha) – Oil Palm - Mature 7,096 12,309 • Immature 0 215 2 Conservation Area (ha) - comprising buffer zones along small streams, hilly 12.20 22.77 areas, swampy and unplantable areas 3 HCV Area (ha) - comprising buffer zones near forest reserves, 7.30 14.89 water catchments, burial & religious sites
1.6 Other certifications held and Use of RSPO Trademarks There are currently no other certifications held by IOI -Pukin Grouping PMU. The RSPO’s trademarks and logo are not being used by the PMU audited. Instructions for use were provided and acknowledged by the PMU through a signed Memorandum of commitment agreeing to adhere to the latest “RSPO Rules on Communications & Claims”.
1.7 Organizational information / Contact Person
Mr. Too Heng Liew Head of Sustainability (Malaysia/Indonesia) IOI Corporation Berhad Level 8, Two IOI Square, IOI Resort, 62502, Putrajaya Tel: 603 8947 8888 Fax: 603 8947 8988 Email: [email protected]
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1.8 Tonnages Verified for Certification
1.8.1 The breakdown of all the suppliers and their tonnages of FFB supplied to the POM at Pukin Grouping based on the reporting period for 2013 / 2014 are as shown in Table 5 below:
Table 5: FFB Supply to Pukin Grouping POM for reporting period 2013 / 2014 (01 Jul 2013 until 30 Jun 2014 – Actual 9 months + projected 3 months).
FFB Processed Main Receiving RSPO P&C Certification # Estate /Supplier (MT) Palm Oil Mill By CB (date) 1. Pukin estate 40,345.32 Pukin Oil Mill Intertek (2012) 2. Segamat estate 44,968.24 Pukin Oil Mill Intertek (2012) 3. Shahzan 1 estate 43,431.96 Pukin Oil Mill Intertek (2012) 4. Shahzan 2 estate 46,421.39 Pukin Oil Mill Intertek (2012) 5. Leepang A estate 49,955.20 Pukin Oil Mill SIRIM (2010) 6. Laukin A estate 24,296.61 Pukin Oil Mill SIRIM (2010) 7. Bukit Serampang estate 65,948.69 Pukin Oil Mill SGS (2010) A Sub-Total Pukin PMU estates 315,367.41
8. Bkt Dinding estate 311.29 Gomali Oil Mill SGS (2010) 9. Bahau estate 408.99 Gomali Oil Mill SGS (2010) 10. Regent estate 144.58 Gomali Oil Mill SGS (2010) 11. Sagil estate 2,218.58 Gomali Oil Mill SGS (2010) 12. Jasin Lalang estate 135.74 Gomali Oil Mill SGS (2010) 13. Detas 287.75 Bukit Leelau Oil Mill SIRIM (2009) 14. Merchong 319.35 Bukit Leelau Oil Mill SIRIM (2009) 15. Mekassar 63.53 Bukit Leelau Oil Mill SIRIM (2009) Sub-Total other IOI certified B 3,889.81 estates:
C Grand total: 319,257.22
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1.8.2 Total annual volumes / tonnages of FFB supplied from the supply base to Pukin Grouping POM during the previous period, current assessment and projected period are as shown in Table 6 below:
Table 6: FFB Processed by Pukin Grouping POM for 3-Year reporting period
FFB Processed in FFB Processed for FFB Processed in Estate / 2013 / 2014 2014 / 2015 2012 / 2013 Supplier Actual + Projected 3 months - Projected (01 Jul 2012 – 30 Jun 2013) (01 Jul 2013 -30 Jun 2014) (01 Jul 2014 - 30 Jun 2015) MT % MT % MT %
Pukin Grouping 168,900.90 66.59 315,367.41 98.78 325,000 98.69
Other Suppliers (certified PMUs 84,750.69 33.41 3,889.81 1.22 4,300 1.31 under IOI Group)
Total 253,651.59 100.00 319,257.22 100.00 329,300 100.00
SCCS Model for SG SG SG POM
1.8.3 The annual certifiable tonnages of CPO and PK production by Pukin Grouping from the supply base/suppliers as assessed and verified during the current Annual Surveillance Assessment (ASA-03) cum Extension of Scope (based on 2013 / 2014 data) are detailed as shown in Table 7 below:
Table 7: Total CPO and PK Produced by Pukin Grouping POM for 3-Year Reporting Period
2013 / 2014 2014 / 2015 POM 2012 / 2013 - Actual + Projected - Actual + Projected
Total FFB 253,651.59 319,257.22 329,300.00 Processed (MT)
Total CPO OER: % OER: OER: 56,057.00 68,768.01 74,915.75 Production (MT) 22.1% 21.54% 22.75% Total PK KER: % KER: KER: 10,932.38 15,260.45 16,465.00 Production (MT) 4.31% 4.78% 5.00%
Note: Currently, the POM has established and maintained procedures for the book keeping and monitoring requirements for the CPO at the mill and was verified to be adopting the ‘Segregation – SG’ model in accordance with the RSPO Supply Chain Certification Standard (SCCS) requirements. Verified activities and checked items for the SCCS of the POM are reported in section.3.1.1.
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1.9 Time Bound Plan for Other Plantation Management Units
IOI Corporation Berhad has been a member of RSPO since 18 May 2004 and is committed to full compliance with the RSPO P&C and full certification in all aspects of its operations. IOI Corporation Berhad owns and operates 12 palm oil mills and 77 estates throughout Malaysia and Indonesia.
To-date a significant number of its Plantation Management Units (PMUs) have undergone the RSPO certification process in accordance with its revised and updated time bound plan which is to achieve RSPO certification for all its PMU’s by year end 2017.
Currently, the Time Bound Plan as submitted by IOI Group is subject to certain conditions as set by the RSPO Secretariat. Details of the updates on this are covered under Appendix F.
The information pertaining to IOI’s plantation activities and status are also available at the following website link: http://www.ioigroup.com/business/busi_plantoverview.cfm http://www.ioigroup.com/business/busi_millsestates.cfm
Details of the time bound plan as submitted by IOI are as per Appendix E.
1.10 Abbreviations Used
CB Certification Body LTA Lost Time Accidents CHRA Chemical Health & Risk Assessment Intertek Intertek Certification International Sdn Bhd CPO Crude Palm Oil IOI IOI Corporation Berhad CSDS Chemical Safety Data Sheets MSDS Material Safety Data Sheets CSPO Certified Sustainable Palm Oil MTCS Malaysia Timber Certification Scheme CSPK Certified Sustainable Palm Kernel NCR Non-Conformance Report EFB Empty Fruit Bunch NGO Non-Government Organization EHS Environmental Health & Safety OER Oil Extraction Rate EIA Environmental Impact Assessment OHS Occupational Health & Safety Programme for the Endorsement of Forest ETP Effluent Treatment Plant PEFC Certification FFB Fresh Fruit Bunch PK Palm Kernel GAP Good Agriculture Practice PMU Plantation Management Unit HCV High Conservation Values POM Palm Oil Mill IPM Integrated Pest Management POME Palm Oil Mill Effluent ISCC International Sustainability & Carbon Certification PPE Personal Protective Equipment IUCN International Union for Conservation of Nature SCCS Supply Chain Certification Standard KER Kernel Extraction Rate SOP Standard Operating Procedures
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2.0 ASSESSMENT PROCESS
2.1 Assessment Methodology, Plan and Site Visits
Since 4 Mar 2014, Intertek has initiated public communications and notifications and invited the relevant stakeholders before the assessment to provide feedback and comments on their concern (if any) on Pukin Grouping regarding the environmental, biodiversity, community development and other relevant issues.
From 8-11 Apr 2014, the Assessment team of Intertek conducted the Annual Surveillance Assessment (ASA-03) cum Extension of Scope in which 3 out of the 7 estates of Pukin Grouping namely Leepang A Estate, Laukin A Estate, and Bukit Serampang Estate as well as the palm oil mill were assessed for compliance against the RSPO requirements. The number of estates sampled was based on a minimum sample of 0.8 √y where y is the number of management sub-units and the selection was made based on their potential risks on social, environmental and biodiversity issues such as their proximity to forest reserves, hill sides, riparian zones and high conservation value areas.
During the on-site assessment, relevant documents and records, including Standard Operating Procedures (SOP), management plans, hectarage development, FFB, CPO and PK production, oil palm age profile, operational controls and measures, operational data and records, training records, etc. were reviewed and verified for compliance. The Assessment team using the process approach auditing technique covered the palm oil mill and estate operations, agricultural practices, pest management, pesticide and fertilizer application, occupational health and safety, social accountability, environment and other requirements. Stakeholders’ interviews were conducted during the assessment and feedback obtained as part of information and evidence gathering. (See section 2.5 Process of stakeholder consultation).
Pukin Grouping POM was also assessed against the requirements for the Segregation Module as specified in RSPO Supply Chain Certification Standard for CPO mill. This part of the assessment covered the verification of implementation of documented procedures and availability of records to demonstrate compliance against all the elements for Segregation requirements. These include documented procedure, purchasing and goods in, record keeping, sales and goods out, processing, monitoring and traceability of the CSPO and CSPK quantities, training for staff and claims.
After completion of the on-site field assessment, Intertek also performed the evaluation of conformity against the RSPO Certification System requirements for CB. The assessment report, findings and associated documents were evaluated through an independent review by the Intertek Internal Evaluation Panel prior to submission of the Assessment Report to RSPO Secretariat for approval.
The details of the Assessment Plan (actual on-site) are provided in Appendix B.
2.2 Date of next scheduled visit
The next scheduled visit will be the Annual Surveillance Assessment (ASA-04) which will be carried out within a 12-month period after RSPO acceptance of this report.
2.3 Qualifications of the Lead Assessor and Assessment Team
Competency details of the Lead Assessor and Assessment Team are given in Appendix A.
2.4 Certification Body
Intertek Certification International Sdn Bhd [formerly known as Moody International Certification (Malaysia) Sdn Bhd] is part of the Intertek Group, which is a worldwide technical services organization dedicated to reducing clients' risks by providing technical inspection services, management system certification in quality, environmental, occupational safety & health and product certification, RSPO SCC, ISCC, Marine Sustainability Chain-of-Custody, MTCS and PEFC Chain-of Custody certification in applicable industry sectors including the agricultural and forestry sectors. Intertek operates globally providing clients with a wide-ranging technical inspection expertise and access to thousands of skilled specialists worldwide. Intertek Group’s certification business is ranked in the top 10 worldwide, and is available globally offering certification across a wide range of industries.
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2.5 Process of stakeholder consultation
Stakeholder consultations began with notification of the upcoming assessment through the websites of RSPO, IOI and Intertek. E-mails, facsimiles and letters of the same were sent to applicable stakeholders including government agencies, NGOs and local communities. Telephone enquiries were made prior to the actual assessment and stakeholder’s response and feedback received were followed up accordingly.
During the assessment, stakeholders were interviewed and their feedbacks were recorded. Among the stakeholders consulted were workers, trade union leaders, women representatives; local community leaders, representatives of government departments / agencies and NGOs; external FFB suppliers, fertilizer suppliers and contractors.
Details on stakeholders’ feedback, PMU response and Intertek verification / comments are provided in section 3.3.
Among the list of key stakeholders consulted was the following:
Government Agencies (by emails) 1. Department of Lands And Mines, Kuala Lumpur 15. Department of Occupational Safety & Health, Johor 2. Department of Environment, Kuala Lumpur 16. Department of Wildlife & National Parks, Johor 3. Department of Forestry Peninsular Malaysia 17. Land and Mines Office, Johor 4. Department of Immigration , Kuala Lumpur 18. Pertubuhan Keselamatan Sosial (SOCSO), Johor 5. Department of Irrigation & Drainage, Kuala Lumpur 19. Pejabat Buruh, Johor 6. Department of Labour, Kuala Lumpur 20. Department of Environment, Johor 7. Department of Occupational Safety & Health, Kuala 21. Department of Forestry, Johor Lumpur 8. Department of Orang Asli Affairs, Kuala Lumpur 22. Department of Immigration, Pahang 9. Department of Wildlife & National Parks, Kuala Lumpur 23. Department of Irrigation & Drainage, Pahang 10. Department of Environment, Johor 24. Department of Labour, Pahang 11. Department of Forestry, Johor 25. Department of Occupational Safety & Health, Pahang 12. Department of Immigration, Johor 26. Department of Wildlife & National Parks, Pahang 13. Department of Irrigation & Drainage, Johor 27. Land and Mines Office, Pahang 14. Department of Labour, Johor
Statutory Bodies (by emails) 28. Malaysian Palm Oil Board (MPOB) 33. Malaysian Palm Oil Board (MPOB) - Sarawak Region 29. Malaysian Palm Oil Board (MPOB) - Northern Region 34. Malaysian Palm Oil Board (MPOB) - Sabah Region 30. Malaysian Palm Oil Board (MPOB) - Central Region 35. Malaysia Palm Oil Association (MPOA) 31. Malaysian Palm Oil Board (MPOB) - Southern Region 36. Malaysia Palm Oil Association Kuala Lumpur (MPOA) 32. Malaysian Palm Oil Board (MPOB) - Eastern Region 37. Malaysia Palm Oil Association Sabah (MPOA)
NGOs (by emails) 38. All Women’s Action Society (AWAM) 68. Malaysian Nature Society Pulau Pinang 39. BCSDM - Business Council for Sustainable Development in Malaysia 69. Malaysian Nature Society Sabah 40. Borneo Child Aid Society (Humana) 70. Malaysian Nature Society Terengganu 41. Borneo Resources Institute Malaysia (BRIMAS) 71. Malaysian Plant Protection Society (MAPPS) 72. Mountaineering and Outdoor Pursuits Association of Negeri 42. Borneo Rhino Alliance (BORA) Sembilan 73. National Council of Welfare & Social Development 43. Center for Orang Asli Concerns COAC Malaysia - NCWSDM 44. Centre for Environment, Technology and Development, Malaysia – CETDEM 74. National Union of Plantation Workers (NUPW) 45. Consumers Association Of Penang – CAP 75. Partners of Community Organisations (PACOS) 76. Penang Institute previously known as Socio-Economic & 46. EcoKnights Environmental Research Institute (SERI) 47. ENO Asia Environment 77. Pesticide Action Network Asia and the Pacific (PAN AP) 48. Environmental Management and Research Association of Malaysia (ENSEARCH) 78. Proforest - South East Asia Regional Office 79. R.E.A.C.H. - Regional Environmental Awareness Cameron 49. Environmental Protection Society Malaysia (EPSM) Highlands 50. Friends of the Earth, Malaysia 80. Sabah Wetlands Conservation Society (SWCS) 51. Future in Our Hands Society, Malaysia 81. SEPA - Sabah Environmental Protection Association 52. Global Environment Centre 82. SUARAM - Suara Rakyat Malaysia 53. HUTAN - Kinabatangan Orang-utan Conservation 83. SUHAKAM - National Human Rights Society - Persatuan Programme Kebangsaan Hak Asasi Manusia 54. Institute of Foresters, Malaysia (IRIM) 84. Sustainable Development Network Malaysia (SUSDEN) 55. JUST - International Movement for a Just World 85. Tenaganita Sdn Bhd
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56. Malaysian CropLife & Public Health Association (MCPA) 86. The Malaysian Forum of Environmental Journalist (MFEJ) 87. TRAFFIC Southeast Asia - Wildlife trade & trafficking 57. Malaysian Environmental NGOs – MENGO monitoring programme 58. Malaysian National Animal Welfare Foundation – MNAWF 88. Transparency International - Malaysian Chapter 59. Malaysian Nature Society (MNS) Kuala Lumpur 89. Treat Every Environment Special Sdn Bhd. (TrEES) 60. Malaysian Nature Society Johor 90. UNION - AMESU 61. Malaysian Nature Society Kedah 91. United Nations Development Programme - UNDP Malaysia 62. Malaysian Nature Society Kelantan 92. Water Watch Penang (WWP) 63. Malaysian Nature Society Kuching 93. Wetlands International (Malaysia) 64. Malaysian Nature Society Melaka/Negeri Sembilan 94. Wild Asia Sdn Bhd 65. Malaysian Nature Society Miri 95. World Wide Fund for Nature (WWF) Malaysia 66. Malaysian Nature Society Pahang 96. World Wide Fund of Nature (WWF) Sabah 67. Malaysian Nature Society Perak
Local community (On-site interviews) Gender representatives Suppliers / Contractors Workers representatives Village Heads
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3.0 ASSESSMENT FINDINGS
3.1 Summary of findings
Principle 1: Commitment to transparency Criterion 1.1 Growers and millers provide adequate information to relevant stakeholders on environmental, social and legal issues relevant to RSPO Criteria, in appropriate languages and forms to allow for effective participation in decision making. Indicators Findings and Objective Evidence Compliance 1.1.1 There shall be evidence that growers The PMU had conducted its stakeholder consultation on Complied and millers provide adequate information 06/03/2014. Meeting minutes were maintained. Noted on (environmental, social and/or legal) that local officials from Ministry of Health, Police and issues relevant to RSPO Criteria to MOH, SOCSO, local community associations and leaders relevant stakeholders for effective participation in decision making. were consulted. Requests made were attended to, and generally no negative remarks or complaints/grievances Major Compliance were found.
Information on environmental, social and legal issues relevant to RSPO Criteria was made available to relevant stakeholders for effective participation in decision making. EIA, Management Plans & Continuous Improvement Plans were also reviewed. Records of participation and decision plans were verified to be maintained. 1.1.2 Records of requests for information The PMU had established and maintained an updated list Complied and responses shall be maintained. of internal stakeholders, external stakeholders, government departments/agencies, consultants, Major / Minor – TBF contractors, suppliers, transporters, etc. The mill and audited estates have maintained their respective Correspondences and Stakeholder Meetings records.
Correspondences were updated till latest Mar 2014 with local officials, local community associations and leaders. Feedbacks and requests were attended to in a timely manner. It was verified that there were no significant negative issues or grievances at the PMU. Records maintained were easily retrievable and made available upon request during the assessment. Criterion 1.2 Management documents are publicly available, except where this is prevented by commercial confidentiality or where disclosure of information would result in negative environmental or social outcomes. Indicators Findings and Objective Evidence Compliance 1.2.1 Publicly available documents shall Management documents’ relating to environmental, social Complied include, but are not necessarily limited to: and legal issues was verified to be maintained and
available to the public (notices and websites) and Major Compliance updated by IOI, HQ e.g. website link:
• Land titles/user rights (Criterion 2.2); http://www.ioigroup.com/business/busi_plantoverview.cfm Documents that are available to the public includes: - land titles/user rights, - occupational health and safety plan, - assessments relating to environment and social impacts, - pollution prevention plans, - details of complaints & grievances, - negotiation procedures - continuous improvement plans
Copies of all the land titles were available and have been
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maintained at the Mill and respective estates. • Occupational health and safety plans Occupational Safety and Health Plan has been Complied (Criterion 4.7); established by the Safety & Health Manager Plantations (Malaysia) and approved by the respective manager for mill and estates in Pukin POM Grouping. The plan was annually reviewed as follows in the POM and sampled estates : a) Pukin POM – 25/06/2013 b) Bukit Serampang Estate – 29/ 06 / 2013 c) Laukin A Estate – 30 /08/2013. d) Leepang A Estate – 29/07/2013.
An effective level of activities and action items were planned and progressively implemented for FY2013/2014. The OSH Program was displayed prominently in notice boards in the Mill and respective estates. See also findings under C4.7. • Plans and impact assessments relating to SIA and EIA reports were available and have been Complied environmental and social impacts suitably reviewed by the IOI Sustainability Team together (Criteria 5.1, 6.1, 7.1 and 7.8); with the respective Mill and Estate managers for FY2013/2014.
Management documents relating to environmental and social issues were reviewed as evident in the minutes of meetings maintained by the respective units within the IOI Pukin PMU.
See also findings under C5.1 and 6.1. • HCV documentation (Criteria 5.2 and 7.3); The Assessment reports on ‘Internal HCV and Complied Conservation Areas’ dated FY2013/2014 were available. It is verified that the Management Action Plans for HCV and Conservation areas were being monitored and progressively implemented at the respective Estates. See also findings under C5.2. • Pollution prevention and reduction plans Pollution Prevention Management Plans were reviewed in Complied (Criterion 5.6); for FY2013/2014. Action items recorded included the programs for awareness and continued implementation of the 3Rs in handling pollutants and wastes among the estate staff and workers. See also findings under C5.6. • Details of complaints and grievances The mill and respective estates had maintained the Complied (Criterion 6.3); Complaints and Grievances Logbook. ECC (Employees Consultative Committee) representatives interviewed had confirmed that there were no serious issues which warrant major actions from the PMU Management.
Logbook entries till Mar 2014 were viewed. Employees Consultative Council (ECC) representatives interviewed had confirmed that there were no serious issues. See also findings under C6.3. • Negotiation procedures (Criterion 6.4); Negotiation procedure and flowchart was available and Complied maintained since Jul 2009. Additionally via website link: http://www.ioigroup.com/business/busiplantoverview.cfm No borders at estates in Pukin Grouping were adjacent to any villages or native land. Therefore not required for records of negotiation or compensation pertaining to this criteria.
No changes in status noted during this assessment on- site. Hence no negotiation or compensation records
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pertaining to this criterion require follow up verification. IOI had also uploaded the status on the land dispute/claim at their plantation in Sarawak which is publicly available at website link: http://www.ioigroup.com/default.cfm
See also findings under C6.4. • Continual improvement plans (Criterion Continual Improvements Plans in key operations for the Complied 8.1); mill and estates have been developed which were regularly monitored and reviewed. The plans were noted to have included the improvements to social, environmental and agricultural practices Monitoring and implementation of the Continuous Improvement Plans is progressive. Reviews were done by the Mill and Estate managers and Sustainability Manager FY2013/2014. Overall long term improvement plans were also viewed via the website link: http://www.ioigroup.com/business/busi_agritech.cfm
See also findings under C8.1 • Public summary of certification Public summary of certification assessment reports and Complied assessment report; their status for the IOI Group certified PMUs are made publicly available via weblink: http://www.ioigroup.com/business/busi_plantoverview.cfm • Human Rights Policy (Criterion 6.13). The Human Rights Policy has not yet been documented New and communicated to all levels of the workforce and requirement operations. of RSPO P&C (2013) - Follow up will be done at next Surveillance assessment.
Criterion 1.3 Growers and millers commit to ethical conduct in all business operations and transactions. Indicators Findings and Objective Evidence Compliance 1.3.1 There shall be a written policy Policy of Commitment to a Code of Ethical Conduct and New committing to a code of ethical conduct and Integrity has not yet been documented and requirement integrity in all operations and transactions, communicated to all levels of the workforce and of RSPO which shall be documented and operations. P&C (2013) - communicated to all levels of the workforce and operations. Follow up will be done at Major / Minor (TBF) next Surveillance assessment.
Principle 2: Compliance with applicable laws and regulations Criterion 2.1 There is compliance with all applicable local, national and ratified international laws and regulations. Indicators Findings and Objective Evidence Compliance 2.1.1 Evidence of compliance with relevant At the PMU, a legal register covering the applicable local Complied legal requirements shall be available. and international laws and regulations are available compiled together inside the SIA. Compliance to each Major Compliance law and regulation is monitored by the PMU.
The PMU also had been tracking the changes in legal requirements. These were reviewed on yearly basis and updated with the compliance status indicated. The relevant legislations identified and listed were among
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others regarding safety and health, environmental management, pollution management, chemical handling, usage & storage, schedule waste management. Based on the site observations, interviews and records checking at the field and mill, there was sufficient evidence of compliance with the relevant laws, regulations, local and international laws at that the PMU. 2.1.2 A documented system, which The documented system for identifying, determining, Complied includes written information on legal reviewing and updating applicable legal and other requirements, shall be maintained. requirements that the PMU has subscribed to is maintained. Minor Compliance 2.1.3 A mechanism for ensuring Evaluation of legal requirements and the PMU Complied compliance shall be implemented. compliance status to each legal requirement is monitored continuously. No licenses or permits found to be invalid or Minor Compliance expired during the audit. 2.1.4 A system for tracking any changes in Changes in the relevant laws are communicated and Complied the law shall be implemented. received from the IOI Group HQ. The PMU subsequently ensured that the changes and tracking conducted was Minor Compliance adequately updated. Based on the site observations, interviews and records updated, the system used is appropriate to the operations at the PMU.
Monitoring of changes to the applicable laws and regulations carried out through periodical review in accordance with the documented procedure. Criterion 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. Indicators Findings and Objective Evidence Compliance 2.2.1 Documents showing legal ownership Land ownership or lease for the sampled estates found to Complied or lease, history of land tenure and the be in perfect order. There is no change in the land actual legal use of the land shall be ownership of the Pukin Mill since the last assessment. available.
Major Compliance 2.2.2 Legal boundaries shall be clearly It was verified that there has been no change to the Complied demarcated and visibly maintained. stated land titles and designated use for cultivation of oil palms and agricultural use. Major Compliance Locations of several boundary stones and pole markers were visited and verified to be within the boundary parameters of the estates. 2.2.3 Where there are or have been There has been no dispute on the land rights in the PMU. Complied disputes, additional proof of legal As such, the process of fair compensation and FPIC is acquisition of title and evidence that fair currently not applied. compensation has been made to previous owners and occupants shall be available, and that these have been accepted with free, prior and informed consent (FPIC).
Major / Minor (TBF) 2.2.4 There shall be an absence of The estate lands at the PMU are legally owned or leased Complied significant land conflict, unless by IOI and no other users were identified in the land area. requirements for acceptable conflict The existing estates are not encumbered by any resolution processes (see Criteria 6.3 and customary land rights and therefore participatory mapping 6.4) are implemented and accepted by the parties involved. is not required.
Major / Minor (TBF) 2.2.5 For any conflict or dispute over the The estate lands at the PMU are legally owned or leased Complied land, the extent of the disputed area shall by IOI and no other users were identified in the land area. be mapped out in a participatory way with The existing estates are not encumbered by any involvement of affected parties (including
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Major / Minor (TBF)
2.2.6 To avoid escalation of conflict, there The estate lands at the PMU are legally owned or leased Complied shall be no evidence that palm oil by IOI and no other users were identified in the land area. operations have instigated violence in No conflict or dispute over the lands in the PMU. maintaining peace and order in their No incident of violence being instigated. current and planned operations.
Major / Minor (TBF) Criterion 2.3 Use of the land for oil palm does not diminish the legal, customary or user rights of other users without their free, prior and informed consent. Indicators Findings and Objective Evidence Compliance 2.3.1 Maps of an appropriate scale The estate lands at the PMU are legally owned or leased Complied showing the extent of recognised legal, by IOI and no other users were identified in the land area. customary or user rights (Criteria 2.2, 7.5 The existing estates are not encumbered by any and 7.6) shall be developed through customary land rights and therefore participatory mapping participatory mapping involving affected parties (including neighbouring is not required. communities where applicable, and relevant authorities).
Major Compliance 2.3.2 Copies of negotiated agreements The lands were acquired in 1980’s from private plantation Complied detailing the process of free, prior and owners or leased from the Sultan of Pahang in 2000 for a informed consent (FPIC) (Criteria 2.2, 7.5 period of 50 years. Records are available to show such and 7.6) shall be available and shall land acquisition complied with legal requirements without include: infringement of any legal rights that require free, prior and a) Evidence that a plan has been informed consent (FPIC). 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.
Minor Compliance 2.3.3 All relevant information shall be The estate lands at the PMU are legally owned or leased Complied available in appropriate forms and by IOI and no other users were identified in the land area. languages, including assessments of No conflict or dispute over the lands in the PMU. As impacts, proposed benefit sharing, and such, this process is not available for verification. legal arrangements.
Major / Minor (TBF) 2.3.4 Evidence shall be available to show The estate lands at the PMU are legally owned or leased Complied that communities are represented through by IOI and no other users were identified in the land area. institutions or representatives of their own No conflict or dispute over the lands in the PMU. As choosing, including legal counsel.
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such, this process is not available for verification. Major / Minor (TBF)
Principle 3: Commitment to long-term Economic & Financial Viability Criterion 3.1 There is an implemented management plan that aims to achieve long-term economic and financial viability. Indicators Findings and Objective Evidence Compliance 3.1.1 A business or management plan (minimum Business plan for the current year and the next Complied three years) shall be documented that includes, three (3) years had been prepared by the Palm Oil where appropriate, a business case for scheme mill and the estates concerned on FFB yield, CPO, smallholders. OER, and KER, costs of production, etc., and the
Major Compliance records had been verified. 3.1.2 An annual replanting programme projected There would be no replanting on Laukin A Estate Complied for a minimum of five years (but longer where and Leepang A Estate for the next ten (10) years necessary to reflect the management of fragile as the palms were planted in 2001 and 2002. soils, see Criterion 4.3), with yearly review, shall Bukit Serampang Estate’s replanting programme be available. for the next 10 years were as follow: Minor Compliance 2018/19 19/20 20/21 21/22 22/23 Hectares 165 --- 91 103 179
Principle 4: Use of appropriate best practices by growers and millers Criterion 4.1 Operating procedures are appropriately documented, consistently implemented and monitored. Indicators Findings and Objective Evidence Compliance 4.1.1 Standard Operating Procedures (SOPs) for Documents on SOP had been maintained by the Complied estates and mills shall be documented. Palm Oil Mill and the Estates, and the documents had been verified to be in order. Major Compliance 4.1.2 A mechanism to check consistent Records had been kept by the staff concerned for Complied implementation of procedures shall be in place. each operation to monitor the procedure and progress of work, and these records would be Major / Minor (TBF) checked by the Assistant Manager and the Manager regularly. These records had been verified to indicate satisfactory implementation. 4.1.3 Records of monitoring and any actions taken The records of monitoring and the actions taken shall be maintained and available, as appropriate. had been maintained for more than 12 months on the mill and estates concerned. These records had Minor Compliance been verified.
However, in the Palm Oil Mill the date for boiler Minor NC smoke chart printer had not been set correctly. # 1of 2 A minor non-compliance is raised.
In Laukin A Estates’s Selective Spraying Minor NC record, the date for the Selective Spraying did # 2 of 2 not include the “year”, hence one cannot tell in which year the work had been carried out. A minor non-conformance is raised. 4.1.4 The mill shall record the origins of all third- The mill did not source any FFB from third-party. Complied party sourced Fresh Fruit Bunches (FFB). The entire crop was supplied by the estates within the company as verified from the records that Major / Minor (TBF) indicate the source origin of FFB. Criterion 4.2 Practices maintain soil fertility at, or where possible improve soil fertility to, a level that ensures optimal and sustained yield. Indicators Findings and Objective Evidence Compliance 4.2.1 There shall be evidence that good agriculture Annual fertilizer inputs had been monitored Complied practices, as contained in Standard Operating through fertilizer recommendations made by IOI Procedures (SOPs), are followed to manage soil Research Centre. Recommendations had been
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Minor Compliance 4.2.2 Records of fertiliser inputs shall be Records of fertilizer application had been verified Complied maintained. to be in order.
Minor Compliance 4.2.3 There shall be evidence of periodic tissue Leaf sampling and analysis had been carried out Complied and soil sampling to monitor changes in nutrient annually and soil sampling and analysis on a 5 status. year cycle to determine the nutrient levels for fertilizer recommendations that aimed to sustain Minor Compliance the long term soil fertility and nutrient efficiency.
Records had been verified to be satisfactory. 4.2.4 A nutrient recycling strategy shall be in place, Geotube had been used to filter the solid from the Complied and may include use of Empty Fruit Bunches POME and the solid would be used by the estates (EFB), Palm Oil Mill Effluent (POME), and palm for field application as organic fertilizer. residues after replanting.
Minor Compliance EFB mulching had been carried out in mature area along the inter-row. Laukin A Estate utilized 215.62 tonnes of EFB over 12 ha in 2013 while Leepang A Estate utilized 7716.28 tonnes of EFB over 128.77 ha as at Feb, 2014. Bukit Serampang Estate did not use any EFB due to its distant location from the palm oil mill.
POME land irrigation had been carried out on Pukin Estate F10A over 20 ha. Criterion 4.3 Practices minimise and control erosion and degradation of soils. Indicators Findings and Objective Evidence Compliance 4.3.1 Maps of any fragile soils shall be available. Based on the soil maps and field visit verification, Complied there was no fragile soil on the estates. Minor Compliance 4.3.2 A management strategy shall be in place for Planting terraces had been constructed where Complied plantings on slopes above a certain limit (this slope was >10°. needs to be soil and climate specific). Fields were generally covered with soft grasses, Minor Compliance ferns, and herbaceous plants. 4.3.3 A road maintenance programme shall be in Road maintenance programme had been verified Complied place. to be implemented on the estates. Minor Compliance 4.3.4 Subsidence of peat soils shall be minimised There was no peat soil on Laukin A, Leepang A, Complied and monitored. A documented water and ground and Bukit Serampang Estates. cover management programme shall be in place.
Minor Compliance 4.3.5 Drainability assessments shall be required Not applicable at the PMU. Complied prior to replanting on peat to determine the long- term viability of the necessary drainage for oil palm growing.
Minor Compliance 4.3.6 A management strategy shall be in place for There was no other fragile and problematic soil on Complied other fragile and problem soils (e.g. sandy, low the estates. organic matter, acid sulphate soils).
Minor Compliance Criterion 4.4 Practices maintain the quality and availability of surface and ground water. Indicators Findings and Objective Evidence Compliance 4.4.1 An implemented water management plan Documented water management plan and relevant Complied
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Major / Minor – TBF 4.4.2 Protection of water courses and wetlands, Riparian buffer zone of 20 m. had been sighted on Complied including maintaining and restoring appropriate both sides of Sungai Teriang in Field 02 m/A, and riparian and other buffer zones (refer to national F 02b/B and F 02d/B along sungei Gadak and best practice and national guidelines) shall be Sungei Makau on Laukin A Estate. demonstrated.
Major Compliance There was no construction of bunds/ weirs/dams across the main rivers or waterways passing through the estates. 4.4.3 Appropriate treatment of mill effluent to In palm oil mill, water samples had been taken at Complied required levels and regular monitoring of discharge monthly interval at the discharge point of effluent quality, especially Biochemical Oxygen Demand pond. BOD level had been in the range of 58.5 to (BOD), shall be in compliance with national 207 ppm. with an average of 142.65 ppm. for the regulations (Criteria 2.1 and 5.6). past 12 months. Approved BOD level by DOE was Major / Minor - TBF 500 ppm maximum. 4.4.4 Mill water use per tonne of Fresh Fruit Water usage in the mill from Jan to Dec 2013 Complied Bunches (FFB) (see Criterion 5.6) shall be ranged from 0.96 to 1.55 m 3/tonne FFB with an monitored. average of 1.26 m3/tonne FFB which was within industrial norm of 1.2m 3 to 1.5 m 3/tonne FFB. Minor Compliance
It was noted that the average figure excluded the consumption from Apr to Aug 2013 as the water meter was faulty during the period.
Criterion 4.5 Pests, diseases, weeds and invasive introduced species are effectively managed using appropriate Integrated Pest Management techniques. Indicators Findings and Objective Evidence Compliance 4.5.1 Implementation of Integrated Pest Records on planting of beneficial plants had been Complied Management (IPM) plans shall be monitored. verified on the estates.
Minor Compliance Pest infestation was minimal on the estates. Programme for planting of beneficial plants such as Turnera subulata, Cassia cobanensis, and Antigonon leptopus , and records on areas planted had been verified together with the respective maps to be satisfactory.
Beneficial plants establishment: Current Additional Deadline Laukin A Est. 3.88 km 9.03 km Jun 2014 Leepang A Est 6.60 km 6.00 km Dec 2014 Bkt Serampang Est 4.30 km 2.50 km Dec 2015 There had been no outbreak of leaf eating pest on the estates.
Barn Owl boxes establishment: Current Additional Deadline Laukin A Estate 19 14 Jun 2015 Leepang A Estate 55 150 Dec 2014 Bukit Serampang Est 86 66 Dec 2015
Rat baiting would be carried out when damage is >5%. 4.5.2 Training of those involved in IPM Specific training had yet to be organized pending To verify at implementation shall be demonstrated. the finalization of new MYNI indicators. next surveillance Minor Compliance assessment Criterion 4.6
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Pesticides are used in ways that do not endanger health or the environment Indicators Findings and Objective Evidence Compliance 4.6.1 Justification of all pesticides used shall be Written justification in Standard Operating Complied demonstrated. The use of selective products that Procedures of all agrochemicals use had been are specific to the target pest, weed or disease reviewed and found acceptable. and which have minimal effect on non-target species shall be used where available.
Major Compliance 4.6.2 Records of pesticides use (including active Records of pesticides and their active ingredients Complied ingredients used and their LD50, area treated, used, LD50, area treated, amount of a.i. applied amount of active ingredients applied per ha and per ha, and number of applications had been number of applications) shall be provided. maintained and kept for a minimum of 5 years.
Major Compliance Verified that the records were satisfactory.
4.6.3 Any use of pesticides shall be minimised as It had been the policy of the estates to minimize Complied part of a plan, and in accordance with Integrated the use of pesticides in accordance with integrated Pest Management (IPM) plans. There shall be no pest management. No prophylactic use of prophylactic use of pesticides, except in specific pesticides had been carried out. situations identified in national Best Practice guidelines.
Major Compliance 4.6.4 Pesticides that are categorised as World Paraquat had been eliminated by the end of 2011 Complied Health Organisation Class 1A or 1B, or that are for IOI Group Estates. listed by the Stockholm or Rotterdam Conventions, and paraquat, are not used, except in specific Alternatives such as Glyphosate Isopropylamine, situations identified in national Best Practice guidelines. The use of such pesticides shall be Metsulfuron Methyl, and Triclopy Butoxyethyl minimised and eliminated as part of a plan, and Esther had been used with the elimination of shall only be used in exceptional circumstances. Paraquat.
Major Compliance 4.6.5 Pesticides shall only be handled, used or All pesticide operators had been given training on Complied applied by persons who have completed the the handling and application of the pesticides. necessary training and shall always be applied in Appropriate safety and application equipment had accordance with the product label. Appropriate been provided and used by the operators. safety and application equipment shall be provided and used. All precautions attached to the products shall be properly observed, applied, and All precautions attached to the products had been understood by workers (see Criterion 4.7). observed, applied, and understood by the workers. Programme and training records had been verified Major Compliance to be in order. 4.6.6 Storage of all pesticides shall be according to Pesticides had been stored in accordance to the Complied recognised best practices. All pesticide containers local Occupational Safety and Health Laws and shall be properly disposed of and not used for Regulations and local laws on Pesticides control. other purposes (see Criterion 5.3).
Major Compliance Used chemical containers were disposed of by DOE approved / registered Hazardous waste contractor. 4.6.7 Application of pesticides shall be by proven Pesticides had been applied using the proven Complied methods that minimise risk and impacts. methods (BMP) that minimize risk and impacts.
Major Compliance 4.6.8 Pesticides shall be applied aerially only It is the policy of the company not to carry out any Complied where there is documented justification. aerial application of pesticides. This policy has Communities shall be informed of impending aerial been adhered to. pesticide applications with all relevant information within reasonable time prior to application.
Major Compliance 4.6.9 Maintenance of employee and associated Periodic training on pesticide handling had been Complied smallholder knowledge and skills on pesticide carried out. handling shall be demonstrated; including Information on the pesticides was displayed next provision of appropriate information materials (see
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Criterion 4.8). to the pesticides in the store and at notice board.
Major Compliance 4.6.10 Proper disposal of waste material, Scheduled waste had been disposed of through Complied according to procedures that are fully understood M/S. OLST Petro-Chemical Sdn. Bhd., a licensed by workers and managers shall be demonstrated contractor approved by DOE. (see Criterion 5.3).
Major Compliance Records of scheduled waste involved had been verified to be in order. 4.6.11 Specific annual medical surveillance for Annual medical surveillance for pesticide Complied pesticide operators, and documented action to operators had been carried out as follow: treat related health conditions, shall be Laukin A estate- 7 workers on 22/3/2014 demonstrated. Leepang A Estate- 12 workers on 24/3/2014
Major Compliance Bkt Serampang Est- 7 workers on 28/6/2013 - 6 workers on 16/12/2013
It was verified that the CHRA recommendations has been satisfactorily followed. 4.6.12 No work with pesticides shall be undertaken Verified from records, field inspections and Complied by pregnant or breast-feeding women. interviews that no pregnant or breast-feeding woman had been offered work as pesticide Major Compliance operator. Criterion 4.7 An occupational health and safety plan is documented, effectively communicated and implemented. Indicators Findings and Objective Evidence Compliance The health and safety plan shall cover the Occupational Safety and Health (OSH) plan in Complied following: compliance with OSH Act and Factory Machinery 4.7.1 A health and safety policy shall be in place. A Act had been documented and implemented. health and safety plan covering all activities shall Records on training had been verified on the Palm be documented and implemented, and its effectiveness monitored. Oil Mill and the Estates.
Major Compliance Analysis on the understanding of training by the workers had been verified on Laukin A Estate and Bukit Serampang Estate while this was being prepared by the Palm Oil Mill and Leepang Estate. 4.7.2 All operations where health and safety is an All operations had been risk assessed, Complied issue shall be risk assessed, and procedures and documented and implemented. actions shall be documented and implemented to address the identified issues. All precautions All precautions attached to the products had been attached to products shall be properly observed and applied to the workers. observed and applied to the workers through Major Compliance MSDS. 4.7.3 All workers involved in the operation shall be Awareness and training programme had been Complied adequately trained in safe working practices (see carried out. Criterion 4.8). Adequate and appropriate protective equipment shall be available to all workers at the All workers involved had been adequately trained place of work to cover all potentially hazardous operations, such as pesticide application, machine in safe working practices. operations, and land preparation, harvesting and, if it is used, burning. Appropriate PPE had been provided at the place Major Compliance of work to cover all potentially hazardous operations. 4.7.4 The responsible person/persons shall be The responsible person (usually the Mandore or Complied identified. There shall be records of regular Headman) had been identified. meetings between the responsible person/s and workers. Concerns of all parties about health, Records of regular meetings between the safety and welfare shall be discussed at these meetings, and any issues raised shall be recorded. responsible person and workers to discuss about health and safety had been verified to be Major Compliance satisfactory. 4.7.5 Accident and emergency procedures shall Accident and emergency procedures had been Complied exist and instructions shall be clearly understood written in English and Bahasa Malaysia and by all workers. Accident procedures shall be briefed to staff, workers, contractors and visitors. available in the appropriate language of the
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Major Compliance Records on all accidents had been verified. Quarterly review on accident cases had been carried out during quarterly meeting of Environment, Safety, & Health (ESH) 4.7.6 All workers shall be provided with medical Medical care had been provided to all the workers. Complied care and covered by accident insurance. Local workers are covered by SOCSO, whereas foreign workers are covered by Foreign Workers Major Compliance Compensation Scheme with MSIG Insurance Berhad. 4.7.7 Occupational injuries shall be recorded using Records on Lost Time Accident (LTA) metrics had Complied Lost Time Accident (LTA) metrics been verified to be satisfactory.
Major Compliance Criterion 4.8 All staff, workers, smallholders and contract workers are appropriately trained. Indicators Findings and Objective Evidence Compliance 4.8.1 A formal training programme shall be in A formal training programme on all aspects of Complied place that covers all aspects of the RSPO RSPO Principles and Criteria has been Principles and Criteria, and that includes regular established and implemented. assessments of training needs and documentation of the programme. Training for various categories of operators, Major Compliance including all field and office staff, with regards to their duties and training needs had been reviewed and found acceptable. 4.8.2 Records of training for each employee shall Records of training for employees were available Complied be maintained. and maintained and were verified on a sampling basis at the Mill and respective estates visited. Major Compliance
Principle 5: Environmental responsibility and conservation of natural resources and biodiversity Criterion 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 continual improvement. Indicators Findings and Objective Evidence Compliance 5.1.1 An environmental impact assessment (EIA) Documented Environmental Impact Assessment, Complied shall be documented. Management Actions Plans and Continuous Improvement Plans (EIA/MAP/CIP) for FY Major Compliance 2013/2014 were available and have been adequately reviewed by the mill/estate and the IOI Sustainability Team from HQ - Batang Melaka, Gemencheh, Negeri Sembilan.
The dates of review are as below: • 07 Mar 2014 (Pukin Palm Oil Mill) • 26 Mar 2014 (Leepang A Estate) • 13 Mar 2014 (Laukin A Estate) • 27 Feb 2014 (Bukit Serampang Estate) 5.1.2 Where the identification of impacts requires There were no major changes to the identified Complied changes in current practices, in order to mitigate impacts since the establishment of the documents negative effects, a timetable for change shall be above in 13/10/2009. developed and implemented within a comprehensive management plan. The management plan shall identify the responsible The management plans were maintained and person/persons. monitoring was in place and verified the supporting records. The responsible persons
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Major / Minor -TBF identified were the mill and estates assistant managers for the implementation and monitoring of actions/activities stated in the management plan. 5.1.3 This plan shall incorporate a monitoring The monitoring protocol, operational controls Complied protocol, adaptive to operational changes, which implemented and the mitigation measures plans in shall be implemented to monitor the effectiveness the documents were reviewed at least once every of the mitigation measures. The plan shall be year. The latest review and updates were as reviewed as a minimum every two years to reflect the results of monitoring and where there are stated above (See 5.1.1) After the review all operational changes that may have positive and activities were maintained without any major negative environmental impacts. changes. A timetable for monitoring the EIA/MAP/CIP was developed and implemented. Major / Minor -TBF The implementation and monitoring of the above mentioned plans were verified to be appropriate. Criterion 5.2 The status of rare, threatened or endangered species and other 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 enhanced. Indicators Findings and Objective Evidence Compliance 5.2.1 Information shall be collated in a High The identification and assessment of HCV areas Complied Conservation Value (HCV) assessment that and the annual review of their status has been includes both the planted area itself and relevant performed for FY2013/ 2014. The documents for wider landscape-level considerations (such as the “HCV Assessment” for each Estates audited wildlife corridors). and POM by the IOI Sustainability Department Major Compliance were available during this audit.
The review has indicated for HCV land area (14.89 hectares) and conservation land area (22.87 hectares) as compared to previously. Refer to Table in Section 1.5 Summaries of Conservation and HCV Areas.
For each estate, the HCV areas were identified e.g. river and tributaries/riparian buffer zones (HCV 4 & 5), religious / worship area, cemetery (HCV 6), forest reserves borders (HCV1). Action plans, activities to be implemented or prohibited were listed and records were available in text, photographs and map formats.
HCV Assessments were originally prepared by IOI Sustainability Department, approved by General Manager and respective Mill and Estates. The reviews were approved by the respective Mill and Estate managers. 5.2.2 Where rare, threatened or endangered (RTE) The Forestry officers from Johor and Pahang Complied species, or HCVs, are present or are affected by Forestry Department and Pukin Grouping estates plantation or mill operations, appropriate measures personnel make their separate periodic that are expected to maintain and/or enhance inspections. They did not detect or highlight the them shall be implemented through a management plan. presence of any RTE species along the boundary with the IOI Pukin Grouping estates. Major Compliance 5.2.3 There shall be a programme to regularly There were various training programme to Complied educate the workforce about the status of these regularly educate the employees and other RTE species, and appropriate disciplinary stakeholders about the status of these ERT measures shall be instigated in accordance with species. The training programme include briefing company rules and national law if any individual working for the company is found to capture, harm, during daily muster and awareness programme collect or kill these species. that about company rules, state and national laws on wildlife including plants and penalties of Major Compliance trespassing into forest reserves if any individual
Intertek RSPO Report: May 2014
INTERTEK CERTIFICATION INTERNATIONAL SDN BHD (188296-W)
Report No.: R2020/10-4 IOI Corporation Berhad Pukin Grouping Page 26 of 48 Annual Surveillance Assessment (ASA-03) cum Extension of Scope
working for the company is found to capture, harm or kill any RTE species.
Additional new Notice Boards were installed at the forest boundaries based on consultations with Johor and Pahang Forestry Department 5.2.4 Where a management plan has been created The management plan documents were updated Complied there shall be ongoing monitoring: and approved by the respective estate(s) and mill • The status of HCV and RTE species that are management in Feb 2014.The review mechanism affected by plantation or mill operations shall be had considered the data from HCV monitoring. documented and reported; • Outcomes of monitoring shall be fed back into the The outcome of the review was stated in the management plan. documents and HCV status was maintained without and changes. No RTE were reported or Major / Minor -TBF seen in the designated HCV areas.
Field inspections confirmed that actions are being implemented to safeguard the HCVs. 5.2.5 Where HCV set-asides with existing rights of There were no HCV set asides with existing rights Complied local communities have been identified, there shall of land by any local community as verified during be evidence of a negotiated agreement that the assessment. Thus negotiated agreement of optimally safeguards both the HCVs and these such nature is not applicable. rights.
Major / Minor -TBF Criterion 5.3 Waste is reduced, recycled, re-used and disposed of in an environmentally and socially responsible manner. Indicators Findings and Objective Evidence Compliance 5.3.1 All waste products and sources of pollution All waste products and their sources have been Complied shall be identified and documented. identified and documented in the “Environmental Impact Assessment, Management Action Plans, Major Compliance and Continuous Improvement Plans” for mill and estates - e.g. EFB, fibres, shells, boiler ash, decanter cakes and scheduled wastes. (See 5.1.1) 5.3.2 All chemicals and their containers shall be Recycling bins of three different color codes were Complied disposed of responsibly. available in the POM, workers quarters/ line site(s) and estates and were used for solid waste Major / Minor -TBF segregation and recycling.
The solid waste management at the dumpsite / landfill has appropriate signage i.e. on Health, Safety and Environment rules that are required at the current designated landfill/dumpsite(s).
Biomass is recycled – fibre and shells are sent to mill boiler to be used as fuel. POME from mill is used for land application in the estates.
Scheduled Waste management file identifying all wastes e.g. spent hydraulic oil, spent lubricant oil, residual chemicals, oily contaminated rags and contaminated containers. The major scheduled wastes codes were SW305, SW306, SW409 and SW410. Scheduled waste stores inspected at all sites and disposal was done by scheduled waste disposal company authorized by Department of Environment. Scheduled waste stores inspected at audited sites and disposal was done by scheduled waste disposal company authorized by Department of Environment.
Metal Waste i.e. scrap metal are disposed by
Intertek RSPO Report: May 2014
INTERTEK CERTIFICATION INTERNATIONAL SDN BHD (188296-W)
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contractors who resell to recycling metal factories. Disposal of scrap iron inventory are properly recorded and monitored in record books. 5.3.3 A waste management and disposal plan to The waste management and disposal plan had Complied avoid or reduce pollution shall be documented and been incorporated into the documents dated as implemented. shown in Cl 5.1 to avoid or reduce pollution. Field inspections confirmed their implementation such Major / Minor -TBF as biomass is recycled, excess fibre and shells are sent to external refinery to be used as biomass for refinery power plant. EFB are also sent to the estate fields for mulching. POME from mill is used for land application in the estates. Criterion 5.4 Efficiency of fossil fuel use and the use of renewable energy is optimised. Indicators Findings and Objective Evidence Compliance 5.4.1 A plan for improving efficiency of the use of The use of energy in palm oil mill was monitored Complied fossil fuels and to optimise renewable energy shall monthly to compare the energy usage against the be in place and monitored. production of metric tonne CPO. Electricity generation was through the boiler plant and steam Minor Compliance turbine at mill where palm fiber and kernel shell were used as renewable energy / fuel on a 70/30 ratio basis.
Monthly records of energy consumption of non- renewable and renewable fuel per metric tonne of palm product at the POM were available. At the estates, diesel consumption per metric ton FFB was also monitored on a monthly basis.
For FY2012/2013, diesel usage was 8.58 liters / mt CPO. The direct fossil fuel usage is a reduction when compared against the previous year consumption of 13.24 liters /mt CPO. Criterion 5.5 Use of fire for preparing land or replanting is avoided, except in specific situations as identified in the ASEAN guidelines or other regional best practice. Indicators Findings and Objective Evidence Compliance 5.5.1 There shall be no land preparation by No open burning policy has been implemented Complied burning, other than in specific situations as and enforced throughout mill and estates within identified in the ‘Guidelines for the Implementation the Pukin Grouping strictly complying to the of the ASEAN Policy on Zero Burning’ 2003, or Malaysian environmental law –EQA & Regulations comparable guidelines in other regions. 1974. Major Compliance Field trips confirmed that no evidence of open burning sighted. 5.5.2 Where fire has been used for preparing land Previous crop were felled or mowed down, Complied for replanting, there shall be evidence of prior chipped/shredded. No evidence of open burning approval of the controlled burning as specified in of previous crop carried out as per IOI SOP. ‘Guidelines for the Implementation of the ASEAN Policy on Zero Burning’ 2003, or comparable guidelines in other regions.
Minor Compliance Criterion 5.6 Plans to reduce pollution and emissions, including greenhouse gases, are developed, implemented and monitored. Indicators Findings and Objective Evidence Compliance 5.6.1 An assessment of all polluting activities shall Environmental impact assessment has been Complied be conducted, including gaseous emissions; performed to identify potential pollution to water, particulate/soot emissions and effluent (see gaseous emissions to air and contamination on Criterion 4.4). land. Management Action Plans and Continuous
Major Compliance Improvement Plans were developed by the IOI
Intertek RSPO Report: May 2014
INTERTEK CERTIFICATION INTERNATIONAL SDN BHD (188296-W)
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Sustainability Team to mitigate significant impacts identified. 5.6.2 Significant pollutants and greenhouse gas Significant pollutants and greenhouse gas (GHG) New (GHG) emissions shall be identified, and plans to emissions were identified, e.g. POME, diesel / fuel requirement reduce or minimise them implemented. and fertilizer usage have been documented at the of RSPO P&C PMU. This has been verified to be satisfactory. (2013) - Major / Minor -TBF on-site. Follow up action at next It was noted that the PMU has been monitoring ASA. the GHG emissions under their ISCC certification for sustainable biofuels production. Plans for the reduction or minimization of GHG is being formulated which will be directed from IOI HQ. 5.6.3 A monitoring system shall be in place, with Management plans have been reviewed and Complied regular reporting on progress for these significant approved by the Sustainability Team and pollutants and emissions from estate and mill respective Mill and Estate Manager. Current year operations, using appropriate tools. updated documents were available. These
Major / Minor -TBF exercises were reviewed annually.
Mill gas emissions as monitored online by DOE, using the Continuous Emissions Monitoring System (CEMS) was maintained and verified to be within permissible limits of DOE.
POME treatment, monitoring and land application is monitored, maintained and adhered to DOE regulations. Water samples were regularly taken every six months and tested by mill environment officer in charge and analyzed to ensure compliance to DOE requirements at final discharge points.
Field inspections confirmed that mitigation actions are being implemented as per management plans. Records are maintained and verified on-site to have met the permissible regulatory limits.
Principle 6: Responsible consideration of employees, and of individuals and communities affected by growers and mills Criterion 6.1 Aspects of plantation and mill management that have social impacts, including replanting, are identified in a participatory way, and plans to mitigate the negative impacts and promote the positive ones are made, implemented and monitored, to demonstrate continual improvement. Indicators Findings and Objective Evidence Compliance 6.1.1 A social impact assessment (SIA) including All estates and mill in the PMU has documented Complied records of meetings shall be documented. and implemented a social impact assessment (SIA) which is reviewed annually. Major Compliance Stakeholders’ consultation sessions with the participation of both internal and external stakeholders (including local expertise from Governmental organizations) were conducted by each member of the PMU. These were evident with the list of participants recorded.
Invitation letters to the consultation and minutes of meetings as appended to the SIA Report were maintained as records. The stated objectives of SIA, among others, are: • Handle social issues, such as sexual
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harassment and gender equality • Maintain welfare and safety of work, such as sufficient facilities for the workers as well as on time payment and payment scheme as specified by the laws • Handle grievance procedures including receiving complaints from internal stakeholders related to facilities provided as well as from external stakeholders related to the group contribution to the development of local communities and its immediate surroundings. • Be fair, open and transparent to all stakeholders especially to the parties it has business relationship with.
The discussion covered both the positive and negative impacts. The SIA Report includes the following issues : • Maintenance, repairing and new addition of workers’ quarters • Road maintenance • Business opportunities to local contractors/suppliers • Assistance and contribution towards the safety of the flora and fauna found in the nearby forest reserve. 6.1.2 There shall be evidence that the assessment Attendance list of the stakeholders consultation Complied has been done with the participation of affected mentioned above showed the following official parties. representatives from government agencies such as the police force, medical services, schools as Minor Compliance internal management staff and workers, as well as contractors/suppliers to the Groupings Judging from the issues raised and from interviews of stakeholders during audit, attendees of these meetings were seemed to be able to freely express their view during the identification of findings, impacts, mitigation plans. 6.1.3 Plans for avoidance or mitigation of negative Time bound action plans based on the Complied impacts and promotion of the positive ones, and stakeholders’ consultation as well as all inputs monitoring of impacts identified, shall be during the ECC meetings conducted were developed in consultation with the affected parties, developed by each member of the PMU. documented and timetabled, including responsibilities for implementation. The mitigation is ongoing and monitored regularly Major / Minor -TBF at stated intervals. The plan includes issues to be monitored, proposed mitigation, responsible persons, and expected date of completion. 6.1.4 The plans shall be reviewed as a minimum Each member of the PMU has a document on Complied once every two years and updated as necessary, social impact assessments (SIA) which was in those cases where the review has concluded reviewed annually. that changes should be made to current practices. Time-bound plan for mitigation of issues raised
There shall be evidence that the review includes during the stakeholders’ consultation is reviewed the participation of affected parties. as and when the new development occurs.
Major / Minor -TBF 6.1.5 Particular attention shall be paid to the The PMU does not have any smallholder schemes Complied impacts of smallholder schemes (where the and therefore this requirement is not applicable. plantation includes such a scheme).
Major / Minor -TBF Criterion 6.2 There are open and transparent methods for communication and consultation between growers and/or millers, local
Intertek RSPO Report: May 2014
INTERTEK CERTIFICATION INTERNATIONAL SDN BHD (188296-W)
Report No.: R2020/10-4 IOI Corporation Berhad Pukin Grouping Page 30 of 48 Annual Surveillance Assessment (ASA-03) cum Extension of Scope communities and other affected or interested parties. Indicators Findings and Objective Evidence Compliance 6.2.1 Consultation and communication procedures Documented Policies and procedures are Complied shall be documented. available for internal and external communication. Managers and their assistants of each member of Major Compliance the PMU are the nominated persons responsible for communication with the stakeholders. The PMU has a list of stakeholders including local authorities, government departments, NGOs, service providers, suppliers and contractors.
Interviews with representatives of Gender Committee, internal workers revealed open and transparent communication and consultation. These interviews confirmed the effectiveness of PMU consultation and communication processes with the internal and external stakeholders. 6.2.2 A management official responsible for these Records sighted show evidence of the existence Complied issues shall be nominated. of appointed teams headed by estate managers assisted by assistant managers. The roles and Minor Compliance responsibilities of these appointed officials are defined. 6.2.3 A list of stakeholders, records of all The list of stakeholders, communication and Complied communication, including confirmation of receipt actions taken were maintained in Stakeholders and that effort are made to ensure understanding File. Verified that consultations with various by affected parties, and records of actions taken in stakeholders had been held and recorded in the response to input from stakeholders, shall be maintained. minutes of meeting.
Minor Compliance Criterion 6.3 There is a mutually agreed and documented system for dealing with complaints and grievances, which is implemented and accepted by all affected parties. Indicators Findings and Objective Evidence Compliance 6.3.1 The system, open to all affected parties, shall There is a mutually agreed and documented Complied resolve disputes in an effective, timely and system for dealing with complaints and appropriate manner, ensuring anonymity of grievances, which is implemented and accepted complainants and whistleblowers, where by all parties. requested.
Major Compliance A mutually agreed and documented system in the form of Grievances Book. Procedures and flow chart has been prepared to deal with complaints, dispute and resolution. Grievance Books in all PMU members are still active in recording complaints/requests made by internal workers. Interviews with staff and workers and their representatives revealed knowledge and understanding of the dispute and resolution mechanism. The mechanism provides for open and consensual agreements with relevant affected parties.
Another documented system is called Stakeholder Request Procedure. Corporate level stakeholder could check with the IOI Group website www.ioigroup.com, call IOI Group General line 0389478888 or write to Two IOI Square, IOI Putrajaya to lodge a request/complaint etc.
Other methods of expressing grievances to the estates managements are;
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• Employee Consultative Committee (ECC) meeting • Gender Consultative Committee (GCC) meeting • Weekly linesite inspection by each PMU and monthly line-site inspection by the VMO.
IOI Audit and Risk Management issued an internal whistleblowing protection policy dated Feb. 2013 with the objectives to give the opportunity to the staff and all parties involved with IOI group to report any misconduct. 6.3.2 Documentation of both the process by which A standard record book for IOI Group is used Complied a dispute was resolved and the outcome shall be throughout the PMU, i.e. IOI Group Complaints available. and Grievances Book. The complainants had to Minor sign to acknowledge completion of request/resolution of complaints. Criterion 6.4 Any negotiations concerning compensation for loss of legal, customary or user rights are dealt with through a documented system that enables indigenous peoples, local communities and other stakeholders to express their views through their own representative institutions. Indicators Findings and Objective Evidence Compliance 6.4.1 A procedure for identifying legal, customary The IOI group procedure for the handling of Complied or user rights, and a procedure for identifying grievances and compensation which may arise people entitled to compensation, shall be in place. from any party claiming legal or customary rights is available at the PMU and is also available at the Major Compliance website link: http://www.ioigroup.com/business/busi_millsestates.cfm
The estate lands at the PMU are legally owned or leased by IOI and no other users were identified in the land area. The existing estates are not encumbered by any customary land. Therefore, no cases requiring any negotiation or compensation pertaining to this criterion.
There have been no changes in this status as at the period of verification on site. 6.4.2 A procedure for calculating and distributing The IOI group procedure was documented in Complied fair compensation (monetary or otherwise) shall be handling this indicator has included the statement established and implemented, monitored and of fair and legal compensation in the event of any evaluated in a participatory way, and corrective such claims being made. To date, there is no such actions taken as a result of this evaluation. This procedure shall take into account: gender dispute by any parties reported at the PMU. differences in the power to claim rights, ownership and access to land; differences of transmigrants and long-established communities; and differences in ethnic groups’ proof of legal versus communal ownership of land.
Minor Compliance 6.4.3 The process and outcome of any negotiated The procedure for handling compensation claim Complied agreements and compensation claims shall be process are documented and made publicly documented, with evidence of the participation of available upon request. affected parties, and made publicly available. Minor Compliance Criterion 6.5 Pay and conditions for employees and for contract workers always meet at least legal or industry minimum standards and are sufficient to provide decent living wages. Indicators Findings and Objective Evidence Compliance 6.5.1 Documentation of pay and conditions shall Documentation of pay and conditions are evident Complied be available. in the workers contract. The contract details all necessary employment terms and conditions Major Compliance
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including job/assignment, minimum wage per day, OT calculations, allowance, working hours, deductions, sick leave, holiday entitlement, reasons for dismissal, period of notice etc.
A review of some field workers’ pay slips showed that the calculation of pay is clearly itemised, for example: • Normal day field work wage [Daily Rated or Piece Rated] • Normal working day overtime • Working rest day • Overtime for working rest day • Working public holiday • Overtime for working public holiday • Out-turn incentives [Dec pay slips only] • Vacation Leave Pay - VLP [Dec pay slips only]
Translation into a few different languages of the items mentioned above is provided on notice board nearby the offices in order to help the migrant workers understand the content of the payslip. 6.5.2 Labour laws, union agreements or direct Review of relevant document and interviews with Complied contracts of employment detailing payments and the newly recruited different category of workers conditions of employment (e.g. working hours, confirmed knowledge and understanding of items deductions, overtime, sickness, holiday stated on employment contract including the entitlement, maternity leave, reasons for dismissal, period of notice, etc.) shall be available in the following: languages understood by the workers or explained • Pay rates including calculation of over time carefully to them by a management official. claims are based on the newly implemented Minimum Wages Order 2012. Minor Compliance • Entitlement for public holidays, paid annual leave and medical leave. • Other fringe benefits • The migrant workers with valid working permits are covered under valid Foreign Workers Compensation scheme (FWCS) underwritten by MSIG.
All PMUs compliance to relevant labour laws is evident through random samples check. For example, unused annual leaves entitled for the workers were paid annually in December 6.5.3 Growers and millers shall provide adequate Site visits to workers’ quarters and interviews with Complied housing, water supplies, medical, educational and the workers revealed satisfaction of their housing welfare amenities to national standards or above, conditions according to local expectations. where no such public facilities are available or accessible. Housing, electricity and water supply Minor Compliance Workers staying in the PMU are provided with 24- hour electricity supply. Clean water is supplied almost whole day except when the workers are at work. Weekly line-site inspections are also carried out consistently. Rubbish collection is scheduled at least three times a week.
Sundry shops Sundry shops within the PMU compounds are available from which the staff and workers can get their food supply with ease. From interviews with the workers in the PMU it was found that most
Intertek RSPO Report: May 2014
INTERTEK CERTIFICATION INTERNATIONAL SDN BHD (188296-W)
Report No.: R2020/10-4 IOI Corporation Berhad Pukin Grouping Page 33 of 48 Annual Surveillance Assessment (ASA-03) cum Extension of Scope
household sundries including fresh food, such as fish, chicken, vegetable and meat were available.
Clinics Clinics are available in all five members of the PMU visited which are managed by 3 EHAs. Visiting Medical Officers (VMO) visit officially is once a month to monitor the services provided by the PMU and to review the referred cases from the EHA. Basic medical treatment of minor ailment and first aids such as toilet and suturing (T&S) of small laceration wounds are provided. Sharp bins are available in all clinics and contains of the bins are disposed through properly channel. 6.5.4 Growers and millers shall make Access to food for the workers are considered Complied demonstrable efforts to monitor and improve adequately and sufficiently provided through workers’ access to adequate, sufficient and sundry shops and canteen available in the PMU. affordable food.
Minor Compliance Criterion 6.6 The employer respects the rights 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. Indicators Findings and Objective Evidence Compliance 6.6.1 A published statement in local languages PMU has an established policy recognizing Complied recognising freedom of association shall be freedom of association in English language in available. “Equal Opportunity Employment & Freedom of Association Policies” which is displayed in public Major / Minor -TBF areas. Interviews with staff and workers revealed trade union, i.e. NUPW, is actively represented in the PMU. Employee Consultative Committee (ECC) is also available where its members consist of all different categories of the workers and staff in the PMU. 6.6.2 Minutes of meetings with main trade unions In the PMU, the ECC meetings were conducted in Complied or workers representatives shall be documented. a regular interval. All meetings were documented and properly filed. Major Compliance Criterion 6.7 Children are not employed or exploited. Indicators Findings and Objective Evidence Compliance 6.7.1 There shall be documentary evidence that All PMU audited are committed in the adoption of Complied minimum age requirements are met. IOI“ Policy Statement For No Child Labor” where it is mentioned the minimum age allowed to be hired Major Compliance is 18 years old. This policy is consistent with Act 350, Children and Young Persons (Employment). Upon checking workers profiles at the PMU, no workers below the stated age mentioned above found. Criterion 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. Indicators Findings and Objective Evidence Compliance 6.8.1 A publicly available equal opportunities policy A policy on equal opportunity has been verified by Complied including identification of relevant/affected groups the auditor in the PMU audited. in the local environment shall be documented. IOI Group document on Equal Opportunity Major Compliance Employment and Freedom of Association policies was approved on 20 Aug. 2009 by the IOI Group Plantation Director.
Intertek RSPO Report: May 2014
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This policy is displayed at the front of most PMU offices along with the other policies. 6.8.2 Evidence shall be provided that employees There is a documented “Policy on Foreign Complied and groups including local communities, women, Workers”. Migrant workers are recruited within the and migrant workers have not been discriminated framework of Employment Act 1955, Sabah Labor against. Ordinance 2005, immigration Act 1959/63 and
Minor Compliance Workmen’s Compensation Act 1952.
While the local workers are covered under SOCSO scheme, the migrant workers with valid working permits are covered under Foreign Workers Compensation scheme (FWCS). Both insurances coverage are valid until 30 Sep. 2014. Interviews with both locals and migrants, revealed their satisfaction with the PMU for job opportunities and many welfare amenities such as free housing, water and electricity supplies, medical care, and transportation of school children.
Migrant workers are aware of the grievance procedures through the various Committees, including the ECC, Gender Consultative Committee (GCC) and sprayer group communication through participation at the SIA consultative meetings. 6.8.3 It shall be demonstrated that recruitment Applications for field worker positions most of the Complied selection, hiring and promotion are based on skills, times will be accepted by the estate managements capabilities, qualities, and medical fitness with very minimal requirements due to shortage of necessary for the jobs available. labour supply in this industry. The Pukin POM
Major / Minor -TBF however will require certain special skills from the applicants as the nature of the jobs offered are more technical.
In promotions into higher positions members of the PMUs made their decisions based on skill, capabilities, qualities and medical fitness of the workers. It was evident during the audit that there is no discrimination based on nationality, race, gender, age, etc.
Criterion 6.9 There is no harassment or abuse in the work place, and reproductive rights are protected. Indicators Findings and Objective Evidence Compliance 6.9.1 A policy to prevent sexual and all other forms The availability of “Policy on Sexual Harassment” Complied of harassment and violence shall be implemented for prevention and eradication of sexual and communicated to all levels of the workforce. harassment in the workplace was verified during the audit. Major Compliance
There are record books which are kept under lock and key. So far, there had been no reported cases of sexual and other forms of harassment in the PMU.
Training sessions to understand sexual harassment were held for both male and female workers in the PMU. The GCC meetings are scheduled in a regular interval. The GCCs comprised of both male and female representatives from both genders to enable any
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grievances or complaints related to sexual harassment to be communicated effectively. 6.9.2 A policy to protect the reproductive rights of Reproductive rights of the workers especially Complied all, especially of women, shall be implemented and women are fully protected in PMU. Office staff is communicated to all levels of the workforce. fully aware that they are entitled for two months paid maternity leave. Major Compliance
There is only one pregnant worker in the PMU (Bt. Serampang estate), viz., Nurul Ashikin bte Mohd. Yusuf. However she has just started her maternity leave on 1 Apr 2014 and salary will only be paid on 25 Apr 2014. This audit was conducted before the scheduled pay day. 6.9.3 A specific grievance mechanism which There is an established mechanism in the form of Complied respects anonymity and protects complainants “Grievance Procedure” to manage grievances where requested shall be established, from internal and external stakeholders and as implemented, and communicated to all levels of well as from the general public. the workforce.
Major / Minor -TBF The procedure is explained in a flow chart and available in the local language, Bahasa Malaysia for easy understanding by the local people. The “Grievance Procedure” is displayed in the staff offices, muster call stations and at the public areas as verified during this audit.
Sensitive grievances and complaints are treated as private and confidential thus protecting the anonymity of the complainants, for example the sexual harassment reports. The sexual harassment report books are kept under lock and key and accessible only to assigned personnel within the Gender Consultative Committee. Criterion 6.10 Growers and millers deal fairly and transparently with smallholders and other local businesses. Indicators Findings and Objective Evidence Compliance 6.10.1 Current and past prices paid for Fresh Fruit The current monthly FFB pricing was displayed at Complied Bunches (FFB) shall be publicly available. the Mill and Estate offices. Data on past prices were maintained in the FFB pricing memos issued Major Compliance from the IOI HQ and were available upon request. 6.10.2 Evidence shall be available that The interviews conducted with estate field workers Complied growers/millers have explained FFB pricing, and confirmed that the workers are aware of FFB pricing mechanisms for FFB and inputs/services pricing and the payment they are entitled for the shall be documented (where these are under the types of work they are conducting. control of the mill or plantation).
Major / Minor -TBF Data related to inputs/services such as costing incurred by transportation, logistics, maintenance for road and vehicles, social and environmental costs were noted to have been documented in the respective 5-year budget plans of the Mill and estates. 6.10.3 Evidence shall be available that all parties All parties having contractual agreements with the Complied understand the contractual agreements they enter PMU had entered their contracts with adequate into, and that contracts are fair, legal and understanding of the terms and conditions set transparent. between both parties.
Minor Compliance Evidence was obtained from examination of contracts sampled, which among others included the office staff, field workers of both genders; various contractors providing labour, transport and maintenance works at the PMU.
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On site stakeholder interviews and consultation carried out with the various parties further confirmed their understanding of the contracts entered.
Based on the documented contracts sighted, review of meeting minutes with stakeholders as maintained in the respective files, there was no evidence to suggest of any unfair, illegal or non- transparent practices in the Grouping dealing with the local community businesses. 6.10.4 Agreed payments shall be made in a timely Payment of wages to office staff is consistently Complied manner. made on 25 th of every month. The field workers pay is made no later than seventh day of the Minor Compliance following month. Only when the seventh day of the month falls during weekend the payment is made before tenth day of the month. However, this happens in a very rare occasion.
PMU by local business clearly stated that services rendered or purchases made will be paid within 60 days. This is a standard practice and the PMU received no complaints from any local business on delay of payments during the verification visit. The PMU also show no pending payments to contractors or suppliers beyond the given period. Criterion 6.11 Growers and millers contribute to local sustainable development where appropriate. Indicators Findings and Objective Evidence Compliance 6.11.1 Contributions to local development that are The commitment to contribute towards local Complied based on the results of consultation with local communities is evident and verified as sampled communities shall be demonstrated. below. • Minor Compliance Teachers from nearby Sekolah Agama are complaining that students staying in Palm Oil Mill frequently show up late at school. The mill is requesting assistance from Pukin Estate to fetch the student to school on time. • Request from temple management representative for grass cutting is immediately attended to after dry season is over. 6.11.2 Where there are scheme smallholders, The PMU is not involved with any smallholder Not applicable there shall be evidence that efforts and/or schemes. Therefore no records of any particular resources have been allocated to improve impacts pertaining to this criterion. smallholder productivity
Major / Minor -TBF . No changes in this status as at the period of verification on site. Criterion 6.12 No forms of forced or trafficked labour are used. 6.12.1 There shall be evidence that no forms of All migrant workers at the PMU are legal with Complied forced or trafficked labour are used. passports and valid working permits thus no evident of trafficked workers were found during the Major / Minor -TBF verification audit. 6.12.2 Where applicable, it shall be demonstrated No incidents have been found and this is Complied that no contract substitution has occurred. confirmed that during interviews with external stakeholders this issue has not been raised. Major / Minor -TBF 6.12.3 Where temporary or migrant workers are The policy on ‘Equal Opportunity and Non- Complied employed, a special labour policy and procedures Discrimination’ adopted and implemented by the shall be established and implemented. PMU seemed to cover all necessary aspects of migrant workers related issues.
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Major / Minor -TBF Criterion 6.13 Growers and millers respect human rights. Indicators Findings and Objective Evidence Compliance 6.13.1 A policy to respect human rights shall be A policy on ‘Equal Opportunity and Non- Complied documented and communicated to all levels of the Discrimination’ was adopted and implemented by workforce and operations (see Criteria 1.2 and PMU which covered the necessary aspects of 2.1). human rights related issues.
Major / Minor -TBF This is confirmed to have understood by the different levels of personnel interviewed during the assessment.
The PMU is in process of reviewing their various social policies for integration into a more defined respect for Human Rights policy.
Principle 7: Responsible development of new plantings
Pukin PMU has documented procedures for this development but to date has not carried any new plantings after Nov 2005. Therefore, the requirements of Principle 7 are not applicable during this assessment.
Principle 8: Commitment to continuous improvement in key areas of activity Criterion 8.1 Growers and millers regularly monitor and review their activities, and develop and implement action plans that allow demonstrable continual improvement in key operations. Indicators Findings and Objective Evidence Compliance 8.1.1 The action plan for continual improvement The PMU has identified the social and Complied shall be implemented, based on a consideration of environmental impacts in the internal SEIA, which the main social and environmental impacts and was verified to be implemented and monitored. opportunities of the grower/mill, and shall include a range of Indicators covered by these Principles and Criteria. Continual improvement activities planned and progressively implemented are as outlined below:- Major / Minor -TBF • Planting of beneficial plants to reduce the attack As a minimum, these shall include, but are not by caterpillars and bag worm, thereby reducing necessarily be limited to: the use of pesticides.
• Reduction in use of pesticides(Criterion 4.6); • Maintenance and monitoring of the growth of natural vegetation at the buffer zones and riparian areas.
• Environmental impacts (Criteria 4.3, 5.1 and 5.2); • Prompt reporting and disposal of Scheduled Wastes via e-consignment to DOE.
• • Waste reduction (Criterion 5.3); Significant pollutants and greenhouse gas (GHG) emissions have been identified e.g. POME, diesel / fuel and fertilizer . • It is noted that the HQ Sustainability Team has • Pollution and greenhouse gas (GHG) emissions been monitoring the GHG emissions under their (Criteria 5.6 and 7.8); ISCC certification for sustainable biofuels production. • Plans for continual improvement, i.e the reduction / minimization of GHG is being progressively formulated and implemented by the IOI Sustainability Team from HQ . • Continuously building new workers quarters and upgrading the old housing quarters to improve
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living conditions. • Support and assistance to the local schools. • Social impacts (Criterion 6.1); • Support and assistance for local community
events.
• Palm Oil Mill: 1. To de-sludge effluent ponds once every 2 years upon approval from local DOE. • Optimising the yield of the supply base. 2. A new Bio-gas plant was in the process of construction and would be commissioned at the end of Jun, 2014. 3. “Gotong royong” for cleaning staff quarters and linesite of palm oil mill since Jun 2013.
• Laukin A Estate: 1. Introduction of PAIP (Pengurusan Air Pahang Bhd) water supply to Laukin A Estate at the contracted price of RM 362,900.00. 2. 2 tractors had been licensed to run on Government road for FFB transport.
• Leepang A Estate: 1. Raised the level of pump house next to Rompin River to avoid flood in order to be able to continue pumping water during flood. 2. Provided 2 units of toilet facility for workers at muster ground. 3. Registered one (1) more tractor with license to run on Government road for estate operations. 4. Purchased one (1) unit water tank trailer to supply water to workers in case of emergency. 5. Purchased one (1) unit fiber boat for evacuation of workers during flood.
• Bukit Serampang Estate: 1. Constructed one (1) unit washing bay for vehicles RM 3,020.00 2. Purchased one (1) new Toyota Hiace window van for transporting workers on important matters. 3. Constructed 1 x 2units staff quarters in 2013.
• EFB mulching had been carried out in mature area along the inter-row
• Recycling of domestic waste had been practiced.
• Geotube had been used to filter the solid from the POME and the solid would be used by the estates for field application as organic fertilizer.
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3.1.1 Supply Chain Certification Standards Findings - on CPO Mill
The Supply Chain model applied at Pukin Grouping - POM during this Annual Surveillance Assessment (ASA-03) cum Extension of Scope is Segregation – CPO Mills: Module D
Details of findings are as follows:
D.1 Documented procedures Indicators Findings and Objective Evidence Compliance D.1.1 Procedure for SG Module is: RSPO/SOP/SG/2 The facility shall have written procedures and/or issue 02, dated 01 Sep 2012. Complied work instructions to ensure the implementation of all the elements specified in these requirements. The procedure covered the implementation of all This shall include at minimum the following: elements of SG Module, including all the a) Complete and up to date procedures covering requirements for controlling the FFB receipt, the implementation of all the elements in these processing, sales, CPO and PK dispatch, training requirements and claims. The documented procedure and its implementation confirmed to have complied with all the specified requirements of Segregation (SG) Module D. b) The name of the person having overall Mill manager, Mr V. Ganapathy has the overall Complied responsibility for and authority over the responsibility and authority for implementation and implementation of these requirements and compliance with the documented procedure. compliance with all applicable requirements. This He and other relevant staff under his charge person shall be able to demonstrate awareness of the facilities procedures for the implementation of demonstrated competence, skill and knowledge of this standard. the RSPO Supply Chain Certification Standard Module D requirements and its implementation. D.1.2 Ref Procedure: RSPO/SOP/SG/2 issue 02, dated Complied The facility shall have documented procedures for 01/09/12 - SG Module. receiving and processing certified and non- certified FFBs. For the period FY 2013/2014, the POM received and processed FFB mainly from the PMU Pukin estates and some from IOI’s other certified PMUs. All supplies of FFB were subjected to verification of documents and quality checks by weighbridge personnel.
The identification and documentation needed for supply and processing from the other sources or suppliers are adequately addressed under the procedure for SG Module.
Pukin POM has 4 CPO storage tanks that stored the SG quantities.
D.2 Purchasing and goods in Indicators Findings and Objective Evidence Compliance D.2.1 The Mill had maintained record of tonnages and Complied The facility shall verify and document the volumes supply source of FFB from the respective estates of certified and non-certified FFBs received. at the weighbridge station, in the dispatch chit and weighbridge ticket and these are reported daily to the Pukin POM office as well as the IOI Head Office at Putrajaya.
Noted that the some FFB sources from other IOI PMUs, i.e. Gomali POM and Bukit Leelau POM are also RSPO- SG certified. These are supplied under special circumstances only e.g. when those mills undergo maintenance. There were no non-
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certified FFBs. D.2.2 The Mill monitors FFB reception, CPO and PK Complied The facility shall inform the CB immediately if production. IOI HQ and POM has an internal there is a projected overproduction. monitoring and reporting mechanism for advising the CB of production variations such as projected overproduction situation, when such issue arises. D.3 Record keeping Indicators Findings and Objective Evidence Compliance D.3.1 The records and reports are available from the Complied The facility shall maintain accurate, complete, up- computerized system. Also, hard copies of records to-date and accessible records and reports and reports are properly filed and readily covering all aspects of these requirements. accessible.
Inspection of records and reports at the Mill confirmed these were accurate, complete and updated daily. D.3.2 As per the SOP, the records and reports are Complied Retention times for all records and reports shall be archived and stored in the Mill Office for a minimum at least five (5) years. period of 5 years. D.3.3 Transaction documents and bookkeeping of FFB, Complied The facility shall record and balance all receipts of CPO and PK are done daily and monthly summary RSPO certified FFB and deliveries of RSPO submitted to Head Office. certified CPO, PKO and palm kernel meal on a three-monthly basis. A volume balance recording system that shows FFB deliveries, CPO and PK production and dispatch is balanced every 3 months. D.3.4 Product type and supply chain model indicated as Complied The following trade names should be used and CSPO/SG on relevant documents. specified in relevant documents, e.g. purchase and sales contracts, e.g. *product name*/SG or Segregated. The supply chain model used should be clearly indicated. D.4 Sales and good out Indicators Findings and Objective Evidence Compliance D.4.1 The company invoices to CPO buyer include the Complied The facility shall ensure that all sales invoices following details: issued for RSPO certified products delivered (i) name and address of buyer; include the following information: (ii) date of issue of invoice; a) The name and address of the buyer; b) The date on which the invoice was issued; (iii) CPO or PK as applicable / SG Module; c) A description of the product, including the (iv) Quantity (MT) applicable supply chain model (Segregated) (v) Reference to Weighbridge Ticket and Delivery d) The quantity of the products delivered; Order; e) Reference to related transport documentation. (vi) CPO Specification / PK Specification D.5 Processing Indicators Findings and Objective Evidence Compliance D.5.1 Ref Procedure: RSPOSC/SOP/SG/2 issue 02, 01 Complied The facility shall assure and verify through clear Sep 2012 - SG Module. procedures and record keeping that the RSPO certified palm oil is kept segregated from non Confirmed from records that Pukin POM only certified material including during transport and storage and be able to demonstrate that is has received and processed certified FFB from its own taken all reasonable measures to ensure that estates and estates in other certified IOI PMUs for contamination is avoided. The objective is for 100 FY2013/2014. The processing facility has % segregated material to be reached. The established and implemented a clear procedure systems should guarantee the minimum standard and mechanism for the SG module. Review and of 95 % segregated physical material9; up to 5 % on-site verification confirmed that the mechanism contamination is allowed. was implemented and in compliance with the module requirements at the mill including transport and storage. D.5.2 The facility shall provide documented proof that Documents and records provided documented the RSPO certified palm oil can be traced back to evidence for the FFB receipt and processed, CPO Complied
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D.6 Training Indicators Findings and Objective Evidence Compliance D.6.1 The facility shall provide the training for all staff as All relevant personnel have been trained on RSPO Complied required to implement the requirements of the Supply Chain System and its implementation - Supply Chain Certification Systems. records of training in 06/09/2012, with refresher training done for new personnel in 17/04/2013 13/03/2014. D.7 Claims Indicators Findings and Objective Evidence Compliance D.7.1 Based on the records verified at site, there are no The facility shall only make claims regarding the claims that can constitute a breach of the RSPO Complied use of or support of RSPO certified palm oil that Rules for Communications and Claims as to date. are in compliance with the RSPO Rules for Communication and Claims. Rules & Regulations for RSPO Certification Scheme given to the organization and Memorandum of Agreement signed.
3.1.2 Status on Supply Chain on POM: Based on the documents and records presented during the on-site verifications made, it is concluded that the IOI POM has been able to comply with the requirements of the RSPO SCCS under the ‘SG’ module and is thus eligible for ‘SG’ trading for its palm products for year 2013 / 2014.
3.2 Status of Identified Noncompliance and Corrective Actions, Observations and Positive Elements. The status of the Non-compliances (NCR) and Observations (OBS) identified against the MYNI Compliance Indicators is as per the details below:
Assessment Type Year Noncompliance (NCR) Observations (OBS) Initial / Main Assessment 2010 1- Major and 4- Minor 7 Annual Surveillance 2012 4 - Minor 0 Assessment (ASA-01) Annual Surveillance 2013 2- Minor 0 Assessment (ASA-02)
Annual Surveillance 2014 2- Minor 2 Assessment (ASA-03) cum Extension of Scope
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• Year 2013 – Annual Surveillance Assessment (ASA-02)
NCR # MYNI Details of NCR Indicator 1 / 2 5.1.2 Date issued: 26 Apr 2013 Date due: (Within 30 days Date closed: 11 Apr 2014 Minor of NCR issuance) Nonconformance: Environment improvement plan implementation and monitoring records were not adequately updated in Shahzan 1 estate Root Cause and Corrective Action (replied): Environmental improvement plan and monitoring records already been updated. Management comments and action taken has been clearly stated in the plan. Records of program for monitoring already constructed and distributed to all the operating units. Verification (for effective closure – on site): Verified on-site that environmental improvement plan and monitoring records had already been updated and adequately implemented. Management comments and action taken has been verified. Records of program for monitoring already constructed and distributed to all the operating units. 2/ 2 6.1.3 Date issued: 26 Apr 2013 Date due: (Within 30 days Date closed: 11 Apr 2014 Minor of NCR issuance) Nonconformance: Records showing status of social action plans, i.e annual social plans and mitigation plans from stakeholders consultation are note adequately updated Root Cause and Corrective Action (replied): Mitigation plans from stakeholders consultation has been adequately updated. Social plan schedule and program has been initiated and implemented immediately to all the operating units Verification (for effective closure – on site): Verified on-site that mitigation plans from the stakeholders’ consultation had been adequately updated. Social plan schedule and program was initiated and implemented to all the operating units.
• Year 2014 – Annual Surveillance Assessment (ASA-03) cum extension of scope NCR # Indicator/ Details of NCR ( in year 2014) Category
1 / 2 4.1.3 Date issued: Date due: Date closed: Minor 11/04/2014 11/05/2014 Pending for next surveillance audit Nonconformance: The date for the Boiler Smoke Chart printer in the Palm Oil Mill had not been set correctly. Corrective Action (replied): The date was printed incorrectly due to the depleted battery in the device. Oil Mill PIC has replaced with a new unit of battery and reset/ calibrated the date of the device correctly. The accuracy of the date will be constantly monitored by the Mill Assistant Manager and PIC to prevent future re-occurrence of this matter. Verification: Next surveillance audit
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NCR # Indicator/ Details of NCR ( in year 2014) Category
2 / 2 4.1.3 Date issued: Date due: Date closed: Minor 11/04/2014 11/05/2014 Pending for next surveillance audit Nonconformance: In Laukin A Estates’s Selective Spraying record, the date for the Selective Spraying did not include the “year”, hence one cannot tell in which year the work had been carried out. Corrective Action (replied): Estate Office chief clerk has rectified the issue and the “Year” has been added into the costing book. Verification: Next surveillance audit
3.2.1 Summary of Observations: • Year 2013 – Annual Surveillance Assessment (ASA-02) - Nil • Year 2014 – Annual Surveillance Assessment (ASA-03) cum Extension of Scope - 2 • The 2 Observations (OBS) identified during this assessment are as per below. Note: The progress made on the observations listed will be reviewed during the subsequent surveillance assessment on the action and implementations taken.
Status MYNI Opened Closed Follow up remarks Ref No: Location Details of Observation Indicator date date (if any)
Year 2014 : Annual Surveillance Assessment (ASA-03) cum Extension of Scope (2 Observations) 1 /2 6.3.2 All PMUs Issues raised in different 11/04/14 Pending Currently all issues with the meetings/consultations raised in different Grouping should be compiled in one meetings are kept file and updated regularly separately in a few according to latest status. different files, e.g. stakeholder consultation, ECC meetings, GCC meeting, Grievance book, etc. 2/2 5.2 Pukin HCV details in Pukin POM 11/04/14 Pending POM should be more clearly indicated in writing in the combined (with Pukin Estate) HCV assessment document.
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3.2.2 Identified Positive Elements 1. CSR activities have been maintained by the IOI Pukin PMU Grouping such as financial funding for education , social and religious activities.
2. OSH activities have been very well implemented and maintained for all units within the IOI Pukin PMU Grouping.
3.3 Feedback Raised by Stakeholders and Findings
Intertek had obtained some written and verbal feedback from the stakeholders on the environmental and social performance of Pukin Grouping operations in the course of assessment and consultations. During the Annual Surveillance Assessment (ASA-03) cum Extension of Scope, all pertinent feedback issues were reviewed and followed up for verification and these had been accordingly incorporated into the report findings. See table below:
Stakeholders’ Feedback PMU Response Intertek verification Further / comment on action from further action (if PMU (if any) any) Government Agencies No response received No response Verified no response Nil needed needed Non-Governmental Organizations No response received No response Verified no response Nil needed needed Local Communities NUPW representatives requested monthly RM10 Request has been Verified during the Nil contribution from the PMU for personal assurance approved by PMU audit that RM10 was scheme subscribed from Great Eastern Insurance Management covered by the PMU. Agency. Total monthly premium for the assurance scheme is RM20. Other Interested parties No response received No response Verified no response Nil needed needed
However, there were 2 cases on dispute i.e. at Sarawak, Malaysia and at Kalimantan, Indonesia that involved the IOI Plantation Group which is still being resolved. Details on the status as updated till Jul 2012 are as per below:
3.3.1 Status of Stakeholders comments on the other Management units of the IOI Group of Plantations and CB verification. (Refer to RSPO Certification Systems document, para. 4.2.4)
Background information: On the 26 th Sep 2011, the RSPO Secretariat via a public announcement uploaded at the RSPO website, effectively suspended the new RSPO certifications for the IOI Group due to the following circumstances as extracted (website link: http://www.rspo.org/news_details.php?nid=97 ):
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Breach of RSPO Code of Conduct 2.3 & Certification Systems 4.2.4 (c)
Historical: On Mar 30th, 2011, a formal letter was sent to IOI Research Centre and IOI Corporation Berhad (IOI) on complaints raised by several Non Governmental Organizations namely Migros, Friends of the Earth and Grassroots as well as the local community of Long Teran Kanan in Sarawak.
The statement indicated that the RSPO Grievance Panel has taken several measures against IOI for breaching two core membership mandates and obligations:
1. RSPO’s Code of Conduct 2.3: members will commit to open and transparent engagement with interested parties and actively seek resolution of conflict 2. RSPO’s Certification Systems 4.2.4 (c): Organizations with more than one management unit and/or that have a controlling holding in more than one autonomous company will be permitted to certify individual management units and/or subsidiary companies only if there are no significant land conflicts, no replacement of primary forest or any area containing HCVs since Nov 2005, no labour disputes that are not being resolved through an agreed process and no evidence of non-compliance with law in any of the non-certified holdings.
The measures announced in the public announcement on Mar 31st 2011 included:
1. The suspension of the current and ongoing certification process of all IOI group’s activities with effect from date of announcement. 2. The provision of 28 days to the IOI group to revert with an acceptable solution to these matters, which preferably should be mutually agreed by parties involved. 3. The stipulation to IOI to publish a statement on this matter on their corporate website.
The suspension was related to the cases of dispute as follows: Case 1 - Dispute with the Long Teran Community in Sarawak, Malaysia: Upon review of reports including discussions and deliberation, the RSPO is pleased to announce that both IOI Corporation Berhad (IOI) and the complainants are now committed to the process of mediation as a means to resolve the dispute. Despite having taken some time to resolve, due to the complexity of the matter, the RSPO views this as a positive progress in the right direction. The lifting of the current suspension of new certification for IOI will be dependent on the progress attained by both parties concerned as a result of the mediation process. Case 2 - Dispute in Ketapang District, Kalimantan, Indonesia: Upon diligent review of the documents submitted to the RSPO, it is concluded that the concerns with regards to drained peat land on wildlife habitat and clearing of HCV of primary forests have not been proven. However, IOI has accepted that some of the procedural requirements by the RSPO with regards to the permits for new plantings were not adequately complied with. In line with this, IOI has arrived at an agreement with RSPO in committing to improvements in operational procedures, as well as to comply with all RSPO requirements moving forward.
Lifting of Suspension for New Certifications for IOI Group: On 8 May 2012, following an announcement made by RSPO, an interim lifting suspension for the new certifications for IOI Group (except for IOI estates in the state of Sarawak) valid for a period of 6 months. See links below for details and conditions in the communication from RSPO to IOI and related parties dated 3 May 2012: http://www.rspo.org/file/RSPO%20letter%20to%20IOI%20LTK%20sNGO%2020120503.pdf
As at the time of submission of this report in May 2014 , the interim period for the lifting of suspension on IOI Group has expired and is currently still pending further decisions and announcement by RSPO on this matter.
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4.0 ASSESSMENT CONCLUSION AND RECOMMENDATION
Based on the findings above, IOI Corporation Pukin Grouping had been able to demonstrate its compliance with the RSPO Principles and Criteria (Apr 2013), Malaysian National Interpretation (MY-NI 2010) and the RSPO Supply Chain Certification Standard (Nov 2011) for Palm Oil Mill.
Therefore, it is recommended that the certification of IOI Corporation Pukin Grouping be approved and continued.
Signed for and on behalf of Intertek Certification International Sdn Bhd
Mohan Thavarajah Mohan Thavarajah Lead Assessor
Date:19 May 2014
4.1 Acknowledgement of Internal Responsibility and Confirmation of Assessment Findings
This is to acknowledge and confirm the assessment visits described in this report and the acceptance of the contents and findings in this assessment report.
Signed for and on behalf of ( IOI Corporation )
Mr Too Heng Liew Sustainability Head ( Malaysia / Indonesia) Date : 19 May 2014
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4.2 RSPO Certification Details for Pukin Grouping
Certificate No: RSPO 927888 Issue date: 13 Jun 2012 Expiry date: 12 Jun 2017 Organization IOI Corporation Berhad Address of Head Office: Level 8, Two IOI Square, IOI Resort, 62502 Putrajaya, Malaysia RSPO Membership No: 2-0002-04-000-00 Plantation Management Unit: Pukin Grouping Address of POM: 30km, Lebuhraya Tun Abdul Razak, Keratong, Rompin, Pahang Standards: RSPO Principles and Criteria (Apr 2013) Malaysian National Interpretation (MY- NI, Nov 2010) and RSPO Supply Chain Certification Standards (Nov 2011) for the Palm Oil Mill Certification scope: Production of Crude Palm Oil and Palm Kernels Supply Chain model for Segregation (SG) CPO & PK:
Details of the Mill and Supply bases covered by this certificate and the tonnage approved are:
GPS Reference Name Address Latitude Longitude Pukin Palm Oil Mill 30km, Lebuhraya Tun Abdul Razak, Keratong, Rompin, 02° 43’07.9” N 102° 54’28.7” E Capacity (60 Pahang mt/hr) 30km, Lebuhraya Tun Abdul Razak, Keratong, Rompin, 02° 43’07.9” N Pukin Estate 102° 54’28.7” E Pahang 30km, Lebuhraya Tun Abdul Razak, Keratong, Rompin, 02° 47’58.5” N Shahzan 1 Estate 102° 50’56.3” E Pahang 36km, Lebuhraya Tun Abdul Razak, Keratong, Rompin, 02° 48’59.6” N Shahzan 2 Estate 102° 52’26.5” E Pahang Segamat Estate Km 5, Jalan Segamat Muar, 85009 Segamat, Johor 02° 29’22.0” N 102° 52’58.5” E KM 68, Kuantan-Segamat Highway, 26700 Muadzam Leepang A Estate 03°00’36” N 103°01’48” E Shah, Pahang. KM 72, Kuantan-Segamat Highway, 26700 Muadzam Laukin A Estate 03°01’26” N 103°02’33” E Shah, Pahang. Bukit Serampang KM 12, Jalan Sagil-Tangkak, Segamat, 84900, 02º19’53.65” N 102º41’17.37” E Estate Tangkak, Johor.
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Total annual volumes / tonnages of FFB supplied from the supply base to Pukin Grouping POM during the current Assessment period and projected period are as follows:
FFB Processed in FFB Processed for Estate / Supplier 2013 / 2014 2014 / 2015 Actual + Projected 3 months - Projected MT % MT % Pukin Grouping 315,367.41 98.78 325,000 98.69
Other Suppliers (certified PMUs 3889.81 1.22 4,300 1.31 under IOI Group)
Total 319,257.22 100.00 329,300 100.00 SCCS Model for POM SG SG
The annual certifiable tonnages of CPO and PK production by Pukin Grouping from the supply base/suppliers as assessed and verified during the current assessment and projected for next FY period are detailed as follows:
2013 / 2014 2014 / 2015 POM - Actual + Projected - Actual + Projected Total FFB Processed (MT) 319,257.22 329,300.00 Total CPO Production (MT) 68,768.01 OER: 21.54% 74,915.75 OER: 22.75% Total PK Production (MT) 15,260.45 KER: 4.78% 16,465.00 KER: 5.00%
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