CONFIDENTIAL

1

RSPO MAIN ASSESSMENT REPORT ASSESSMENT DATE: 19TH – 21ST DECEMBER 2011

FELDA PALM INDUSTRIES SDN.BHD. TEMENTI CERTIFICATION UNIT TRIANG, DARUL MAKMUR,

SIRIM QAS INTERNATIONAL SDN. BHD. Building 4, SIRIM Complex, No. 1 ,Persiaran Dato‟ Menteri, Section 2, P.O. Box 7035, 40911 Shah Alam, , Malaysia. Tel: 603 5544 6448 Fax: 603 5544 6763 Website : www.sirim-qas.com.my

SIRIM QAS INTERNATIONAL SDN. BHD. Building 4, SIRIM Complex, No. 1 ,Persiaran Dato‟ Menteri, Section 2, P.O. Box 7035, File Reference 40911 Shah Alam, Selangor, Malaysia. EF00730004

RSPO ASSESSMENT REPORT

CLIENT: FELDA AGRICULTURAL SERVICES SDN BHD

ADDRESS : TINGKAT 7, BALAI FELDA, JALAN GURNEY 1, 54000 , MALAYSIA

DETAIL OF SITE

PALM OIL MILL: FELDA PALM INDUSTRIES SDN BHD , TEMENTI PALM OIL MILL

SUPPLY BASE : 1. FELDA TEMENTI 2. FELDA RENTAM 3. FELDA 4. LADANG FELDA BERA SELATAN 1 5. LADANG FELDA BERA SELATAN 4

ADDRESS OF SITES : FELDA TEMENTI PALM OIL MILL COMPLEX CERTIFICATION UNIT KILANG SAWIT TEMENTI 38300 TRIANG, PAHANG DARUL MAKMUR, MALAYSIA

ASSESSMENT DATE:

STAGE 1 : 17TH – 18TH OCTOBER 2011 DURATION : 6 AUDITOR DAYS STAGE 2 : 19TH - 21ST DECEMBER 2011 DURATION : 10 AUDITOR DAYS

STANDARD : ROUNDTABLE ON SUSTAINABLE PALM OIL (RSPO) INCLUDING SMALLHOLDER MALAYSIA NATIONAL INTERPRETATION WORKING GROUP (MY-NIWG) : NOV 2010

SCOPE OF CERTIFICATION ASSESSMENT: PRODUCTION OF CRUDE PALM OIL AND PALM KERNEL

i TABLE OF CONTENT Heading Page no Abbreviation used

1.0 Introduction 1.1 Description of The Certification Unit 1 1.2 Description of FELDA and Its Settlers Scheme 1 1.3 Organization Structure in a Scheme 2 1.4 Workforce Composition 4 1.5 Time Bound Plan for Other Management Units 4 1.6 Location of Mill and Estate 6 1.7 Other Management System Certification Held & Contact Person 7 1.8 Approximate Tonnages Offered for Certification 8

2.0 Assessment Process 2.1 Assessment Methodology 8 2.2 Date of Next Surveillance Audit 8 2.3 Assessment Team 9 2.4 Stakeholder Consultation 11

3.0 Assessment Findings 13

4.0 Assessment Recommendation 62 5.0 Organizations Acknowledgement of Internal responsibility and Formal sign-off of assessment findings 63

List of Tables Table 1 Total and Composition of Workers in the Certification Unit 4 Table 2 Time Bound Plan for Certification Units 5 Table 3 Location of Mill and Estates 6 Table 4 Average Annual FFB Contribution by Each Estates 6 Table 5 Year of Establishment of Production from Estate and Area Planted with Oil Palm 7 Table 6 Approximate CPO & PK Tonnages Estates Claimed for Certification 8

List of Attachments

Attachment 1a Location Map for FELDA Tementi Certification Unit and neighbouring context 64 Attachment 1b Location Map of Felda Tementi 65 Attachment 1c Location Map of Felda Rentam 66 Attachment 1d Location Map of Felda sebertak 67 Attachment 1e Location Map of Ladang Felda Bera Selatan 1 68 Attachment 1f Location Map of Ladang Felda Bera Selatan 4 69 Attachment 2 Assessment Programme 70 Attachment 3 List and Comment from Stakeholders 75 Attachment 4 Detail Of Non-Conformity And Corrective Actions Taken 78

ii Attachment 5a Soil Map for Ladang Felda Bera Selatan 04 79 Attachment 5b Soil Map for Felda Rentam 80 Attachment 5c Soil Map for Felda Tementi 81 Attachment 6 Opportunities for Improvement 82

Abbreviations:

BOD Biochemical Oxygen Demand B.Sc. Bachelor of Science CHRA Chemical Health Risk Assessment CoC Consolidated Annual Charges COD Chemical Oxygen Demand CPO Crude Palm Oil CU Certification Unit DID Drainage and Irrigation Department, Malaysia DOE Department of Environment DOSH Department of Occupational Safety and Health EARA Environmental Auditors Registration Association EB Executive Board EFB Empty Fruit Bunch EMP Environmental Management Plan EPF Employees Provident Fund EQA Environmental Quality Act ERT Endangered, Rare and Threatened Species FIC FELDA Investment Cooperative FFB Fresh Fruit Bunch GAP Good Agricultural Practice GPS Global Positioning System GPW Gabungan Pembangunan Wanita (Women Development Association) GSA Group Settlement Act Ha Hectares HCV High Conservation Value HIRARC Hazard Identification, Risk Assessment and Risk Control IEMA Institute for Environmental Management and Assessment IPM Integrated Pest Management ISP Incorporated Society of Planters IRCA International Register of Certificated Auditors JCC Joint Consultative Committee JKKR Jawatankuasa Kemajuan Rancangan (Scheme Development Rancangan) M.E Master of Engineering MSDS Material Safety Data Sheet MNS Malaysian Nature Society MOA Memorandum of Alliance or Agreement MPOA Malaysian Palm Oil Association MPOB Malaysia Palm Oil Board MYNI Malaysia National Interpretation MYNI – WG Malaysia National Interpretation – Working Group NCR Non-Conformity Report

iii NGO Non Governmental Organisation OER Oil Extraction Rate OFI Opportunity for Improvement OHD Occupational Health Doctor OSH Occupational Safety and Health OHSAS Occupational Health and Safety Assessment Series PERKESO Social Security Organization PDRM Polis Di-Raja Malaysia Ph.D. Doctor of Philosophy POM Palm Oil Mill POME Palm Oil Mill Effluent PPE Personal Protective Equipment RAMSAR Convention on Wetlands RSPO Roundtable on Sustainable Palm Oil SIA Social Impact Assessment SS Suspended Solid SOP Standard Operating Procedure USA United States of America USECHH Use and Standards of Exposure of Chemicals Hazardous to Health WTP Water Treatment Plant WWF World Wide Fund for Nature

iv RSPO STAGE 2 ASSESSMENT REPORT

1.0 INTRODUCTION

1.1 Description of the Certification Unit

The certification unit (CU) of FELDA Agricultural Services Sdn Bhd, Tementi Palm Oil Mill Complex (hereafter refer as Tementi Certification Unit (Tementi CU) is one of the seventy one complexes of FELDA schemes being assessed for certification against the RSPO Principles and Criteria for Sustainable Palm Oil Production, including smallholder, Malaysia National Interpretation Working Group (RSPO MYNIWG: November 2010).

The Tementi CU is located within the state of Pahang. The assessed CU comprised of FELDA Palm Industries Sdn.Bhd., Tementi Palm Oil Mill, FELDA Tementi, FELDA Rentam, FELDA Sebertak, Ladang FELDA Bera Selatan 1 and Ladang FELDA Bera Selatan 4.

Tementi Palm Oil mill commenced its operations in February 1979 with a processing capacity of 40 mt of FFB per hour. The total combined land area of the five estates is 13,432 hectares (ha). Although Tementi POM receive and process third party FFB this assessment did not include the third party FFB suppliers.

The three smallholder schemes at this CU began as far back as 1978. They are FELDA Tementi, FELDA Rentam and FELDA Sebertak and are land owned by settlers in accordance with the Group Settlement Act (GSA) 1960 and throughout Malaysia they are being managed by the Federal Land Authority, in short FELDA, a government of Malaysia owned agency. In addition, at this CU there are two plantations like estate, that is, Ladang FELDA Bera Selatan 1 and Ladang FELDA Bera Selatan 4 that is managed by FELDA Plantation Sdn. Bhd (FPSB), a subsidiary of FELDA Holdings. FPSB is a service company formed to manage areas (that was not given to settlers) in a commercial manner belonging to FELDA Holdings.

One Manager manages one smallholder‟s scheme. He is primarily tasked to oversee the socio- economic aspect and welfare of the settlers whereas on the field operational support he is assisted by FELDA Technoplant Sdn. Bhd (hereafter referred to as FTP). Unlike the smallholder schemes the estate is solely managed by a Plantation Manager of FPSB. FTP is a subsidiary of FELDA Holdings which is responsible for managing smallholder plantation areas from replanting to production of FFB as well as the maintenance of these planted areas.

1.2 Description of FELDA and its Settlers Scheme

FELDA is a government agency established under the Land Development Ordinance on 1st July 1956. Its objectives are to provide land for the landless, to uplift socio-economic status of rural communities; and to encourage the development of a progressive, productive and disciplined settlers community.

In the following year FELDA initiated the first land development by planting rubber trees at , Pahang. In 1958, five similar schemes were opened. Subsequently, via Group Settlement Act 1960 FELDA developed more areas. Currently, totalling 853,313 hectares (as of March 2012) of land have been opened for cultivation, infrastructure, settlers‟ settlement housing and public facilities for 112,635 settlers. From that, 811,140 hectares are agricultural area of which 722,946 hectares or 84.7 % are planted with oil palm plantation. The remaining

Page 1 of 83 area is planted with rubber, sugar cane, timber, and fruit trees and plot for research and development. FELDA settlers‟ settlement area (village) accounts for 42,173 hectares or 4.9 % of land developed.

The incorporation of FELDA allows it to provide integrated services with economies of scale related to the provision of economic opportunities for the settler‟s community to ensure stable income for the settlers.

Managed as an estate style (2200 – 2500 ha.), a typical settlers‟ settlement includes between 400-600 settlers per scheme and each settler is given a house and a plot of land to farm.

At Tementi CU each settler is assigned to a particular settlement, and is given 10 acres (4.0 ha.) of land to cultivate either rubber or oil palms. All settlers must reside at the settlement itself, and are allotted an additional 0.25 acres (0.10 ha.) in a planned village, where their home - already built by FELDA - is located. About 20 houses made up a block and each block chose its own representatives who voice their concerns to their Scheme Development Committee (JKKR) and FELDA Management. All basic infrastructures, such as piped water, electricity, schools, clinics, and places of worship are provided either by FELDA or through government agencies.

The costs of acquiring, developing and allocating the land are borne by loans made to FELDA settlers. These loans are repaid in monthly installments deducted from the settlers' income over a 15-year period.

Although settlers are supposed to focus on agricultural activities, they are encouraged by the government to participate in non-farm activities, such as entrepreneurship in SAWARI Program (food and craft industry) Agro-based industry, Business, Services and Related activities, etc, as side income.

1.3 Organisation structure in a scheme

In a settlers‟ scheme, as evident in Tementi CU the management of the scheme is based on the structure as shown in Figure 1.

There are two committees in a scheme, one representing FELDA, referred to as Management Committee and the other representing the settlers, known as Settler Committee.

The Scheme Manager besides being responsible to coordinate and manage all aspects in a scheme in an estate like manner is also responsible to the Regional General Manager (RGM), , Pahang in ensuring that his scheme is secure with settlers, their dependant get adequate income, and ultimately FELDA fulfill their social, educational and economic obligations/needs.

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Figure 1: Organization structure in a scheme

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The General Manager is responsible to the Deputy Director General (Farming and Plantations) who in turn reports to the Director General and subsequently upwards to the Board of Directors.

The settlers‟ obligation is to farm their land in accordance to Good Agricultural Practices determined by the Scheme Manager. The Manager together with his Field Supervisors will oversee that the settlers conform to these practices by making daily field visits. The duties of office staff are to monitor the implementation of all activities in a scheme and maintain certain records of implementation.

The binding contract between a settler and FELDA is an agreement tying both parties for a CoC (Consolidated Annual Charges).

1.3.1 Settler’s Institution

Leadership and involvement of settler‟s in scheme management is shown in Figure 2 and are implemented through:

 Block Management  Scheme Development Committee (Jawatankuasa Kemajuan dan Keselamatan Rancangan - JKKR)  JKKR Coalition  Settler's Consultancy Committee (Jawatankuasa Perunding Peneroka - JKPP)  Women Association Movement (Gerakan Perkumpulan Wanita – GPW)

All of these Settler's Bodies play major roles toward Settler's Institution development.

National Level

Regional Level

Scheme Level

Block Level Block Level Block Level

Figure 2 : Settler Participation in Management

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JKKR Coalition is the supreme council for settlers at the Regional level aimed to unite ideas, efforts and energy towards improving production, farm development and formation of settler's family well being. Settler's top involvement and participation in the management and administration of the scheme is through Settler‟s Consultancy Committee, (JKPP).

JKPP is a supreme council where committee members consisted of FELDA's top management and Heads of Male/Female Settlers as well as Youth leaders. JKPP becomes the relation and consultation body between Head of Settlers and FELDA's management. Other roles of JKPP are to study, check, consider and take resolutions of policies concerning settlers.

1.3.2 Human Capitals at FELDA Rentam, FELDA Sebertak and FELDA Tementi

A scheme, as mentioned above, normally would comprise between 300 – 400 smallholders and the scheme is divided into blocks.

While the combined oil palm cultivated areas for Tementi CU (5 estates) is 11,950.30ha, the total planted area for FELDA Rentam, FELDA Sebertak and FELDA Tementi adds up to 5,634ha. The number of oil palm settlers are 430, 410 and 432 for FELDA Rentam, FELDA Sebertak and FELDA Tementi respectively.

In the FELDA schemes assessed, each block typically consists of 20 settler families. They among themselves elect Block Leaders and each block is represented by 2 Block Leaders. The leaders co-ordinate activities within their group members.

Collectively, the settlers through their committees can raise issues of concerns to the Management Committee who via their authority would resolve them amicably. If it cannot be resolved at the Scheme Level, it can be ascended to the Regional and National Level as described above under Settler‟s Institution.

There are also local stakeholders in a scheme. Local stakeholders are organizations/groups involved with the settler community / management such as Gerakan Perkumpulan Wanita and Majlis Belia (Youth Council).

In the FELDA schemes assessed, besides the Scheme Manager and depending on the size of the scheme, there usually is between 5-10 other staff comprising of Field Supervisors, office clerks and driver.

1.3.3 Facilities provided in a scheme

Through site visits, the assessors witnessed the presence of the following infrastructure in all schemes assessed. It include mosque, primary school, religious school, staff quarters, shops, cooperative garage and motor vehicle workshop, scheme/plantation administration office, fertilizer store and community hall.

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1.4 Workforce composition

The total and composition of the workforce at the Tementi CU assessed is as shown in Table 1.

Table 1: Total and Composition of Workers in the Certification Unit

Operating Unit Local Foreign Sub-Total Tementi POM 91 - 91

FELDA Tementi 20 39 59 FELDA Rentam 16 63 79

FELDA Sebertak 27 57 84 Ladang FELDA Bera 74 209 283 Selatan 1 Ladang FELDA Bera 31 222 253 Selatan 4 Grand Total 259 590 849

1.5 Time Bound Plan for Other Management Units

FELDA manages the smallholder schemes, owns oil palm plantations and operates 70 palm oil mills throughout Malaysia.

To-date, FELDA has two of its CUs certified under the RSPO ( i.e. Kota Gelanggi CU and Lepar Utara 6 CU) and FELDA is committed to ensuring that all their operations are certified within the planned time frame as shown in Table 2. FELDA has been on schedule with the time bound plan for the certification of all the CUs. SIRIM QAS International Sdn. Bhd. is now involved with the certification of Tementi CU.

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Table 2: Time Bound Plan for Certification Units

No Mill complexes to be certified in the respective years

2009 2010 2011 2012 2013 2014 2015 2016 2017 Palong 1 K.Gelanggi Jengka 21 Adela Baiduri Ayu M. Puspita Selancar 2A Chalok Sampadi Timor Embara 2 L. Utara 6 Jengka 3 Lok Heng Triang N. Permata Selancar 2B J. Barat Aring A Budi Kembara 3 Jengka 8 Semencu Belitong Tersang Pasoh J. Baru Aring B Sakti 4 L. Utara 4 Waha Bukit Besar L. Kemudi Besout Serting Kertih Ciku B. 5 Jengka 18 Kahang Bukit Sagu Sg Tengi Serting Hilir F. Harapan Kechau A Kepayang 6 Padang Piol Bukit Mendi Kulai Lepar Hilir Trolak Kerau H.Badai Kechau B

7 Segamat GC Kemasul Nitar Neram Keratong 2 Mempaga J.Bistari Kemahang

8 Tementi Penggeli Pancing Keratong 3 Maokil Kalabakan Cini 2

9 Keratong 9 Selendang Umas Cini 3

10 Tenggaroh

11 T.Timor Total 2 7 8 8 8 9 11 9 9 Complexes

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1.6 Location of Mill and Estate

The Tementi CU located in Triang, Pahang. The locations of the scheme are shown in Table 3.

Table 3: Location of Mill and Estate Operating Unit Latitude Longitude

Tementi Palm Oil Mill 03° 15' 47.16"N 102° 35' 48.52"E FELDA Tementi 03° 16' 10.80"N 102° 36' 31.58"E FELDA Rentam 03° 16' 1.00"N 102° 37' 31.22"E FELDA Sebertak 03° 15' 12.80"N 102° 35' 58.53"E Ladang FELDA Bera Selatan 1 03° 11' 56.06"N 102° 36' 30.56"E Ladang FELDA Bera Selatan 4 03° 3' 18.99"N 102° 44' 6.69"E Note: Coordinate readings were taken at the respective scheme administrative office

The location map of the Tementi CU is shown as in Attachment 1.

All the five estates were supplying FFB to the Tementi POM. Apart from them, there were three smallholders regularly sending their harvests to Tementi POM. The average annual FFB contribution from each estate for 2011, is summarised below.

Table 4: FFB Production From Each Estate - January 2011 to December 2011

Scheme FFB Production Tonnes Percentage FELDA Tementi 26,982.73 17.22 FELDA Rentam 13,033.30 8.32 FELDA Sebertak 23,511.84 15.01 Ladang FELDA Bera Selatan 1 38,124.02 24.33 Ladang FELDA Bera Selatan 4 55,016.50 35.12 Total 156,668.39 100.00

Table 5 shows the details of the year of establishment of the scheme, their respective total land and area planted with oil palm, age of palm, planting cycle and percentage of planted area in each scheme.

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Table 5: Year of Establishment of Estates and Area Planted with Oil Palm

Year of Year Planting Age of Total Planted Operating Establish started oil Cycle palm Area Area Unit ment palm (Year) (ha) (ha)

1972/73 1977/78 FELDA nd 2 9 2,461 1,807 Tementi 1977/78 1978 FELDA 1977 1978 nd 2,309 2,029 Rentam 2 6 FELDA 1973-74 1974 nd 2,255 1,798 Sebertak 2 7 Ladang FELDA nd 1983 1984/1985 2 3 3,138 3,138 Bera Selatan 1 Ladang FELDA st 1987-88 1988-1989 1 - 3,269 3,178 Bera Selatan 4

Total 13,432 11,950

1.7 Other Management System Certification Held and Contact Person

Tementi POM has obtained third-party certification for ISO 9001 Quality Management System, ISO 14001 Environmental Management System and OHSAS 18001 Occupational Health and Safety Management System and has completed the annual surveillance audit. However all the supply bases do not hold any form of third-party certification for any of the internationally recognized management system.

Name : Mr. K. Illangovan Designation : General Manager Address : FELDA Agricultural Services Sdn. Bhd., Tingkat 7, Balai FELDA, Jalan Gurney 1, 54000 Kuala Lumpur, Malaysia. Telephone : +603-2698 7772 Fax : +603-2693 0018 e-mail : [email protected]

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1.8 Approximate Tonnages Offered for Certification (CPO and PK)

The approximate tonnage of CPO and PK produced per year, as well as the tonnage claimed for certification, are as shown in Table 6 as follows:

Table 6: Approximate CPO and PK tonnage Claimed for Certification

Tonnage Claimed for Certification (MT) Certification Unit CPO PK

Tementi Certification Unit 31,287 8,458

2.0 ASSESSMENT PROCESS

2.1 Assessment Methodology (Program, Site Visits)

The assessment for certification was carried out in two stages, namely Stage 1 and Stage 2. The Stage 1 assessment was conducted to determine the adequacy of the established documentation in addressing the requirements of the certification standard, the RSPO MYNI November 2010. The Stage 1 assessment was conducted on 17th – 18th October 2011. There were issues of concerns raised and Tementi CU had taken the necessary actions to rectify the issues. The assessor team has verified all the issues during the Stage 2 assessment and they are acceptable.

The Stage 2 assessment was conducted from the 19th – 21st December 2011. The main objective of the Stage 2 assessment was to verify the CU‟s conformance to the requirements of certification standard, the RSPO MYNI. The planning for the Stage 2 assessment was guided according to the RSPO Certification Systems Document. After studying the document at Stage 1, it was decided that the sampling formula of 0.8√y to determine the number of schemes to be audited would not be used as each supplying scheme selected has its own issues related to the requirements of the RSPO MYNI. Each of site were assessed, namely Tementi palm Oil Mill, two from FELDA Plantations Sdn Bhd. and three from FELDA smallholder schemes.

The assessment was conducted by visiting the fields, HCV habitats, aboriginal villages, settlers‟ houses, government clinics, workers quarters, shops, chemical and waste storage areas, landfill and other workplaces. Interviews were held with the CU‟s and the management of its FFB produce, employees, contractors and other relevant stakeholders. In addition, related records and other documentation were inspected.

Details of the actual assessment programme are given in Attachment 2.

2.2 Date of Next Surveillance Assessment

The first surveillance assessment will be conducted around twelve months from the date of issuance of the certificate.

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2.3 Assessment Team

Member of the Role/area of RSPO Qualifications Assessment Team requirements  Over 760 days of auditing experience, having audited on : ISO 14001, OHSAS 18001 & RSPO.  Five and half years experience in palm oil milling  Successfully Completed RSPO Lead Assessor Course - 2008  Successfully Completed RSPO Supply Chain Certification System Lead Assessor / Lead Assessor Course - April 2012 Milling Operation,  Successfully completed ISO 14001 Occupational Health EMS EARA approved Lead Assessor Ruzita Abd Gani and Safety, - 2002 Environment and  Successfully completed IRCA related legal issues accredited Lead Assessor training for ISO 9001:2004  Successfully completed OHSAS 18001 OHSMS IRCA accredited Lead Assessor Course – 2005  Registered Environmental Auditor with Department of Environment (DOE) - 2010  B.Sc. (Hons) Chemical Engineering

 36 years experience in plantation management, covering rubber and oil palm  Diploma in Agriculture, University of Malaya  10 days of auditing experience in RSPO.  Attended a training on RSPO P&C and certification requirements in November Assessor / Good 2010 & April 2012 Yap Nyoke Yong, Agricultural Practices Raymond (GAP) and workers Working Experience : issues  Estate Manager, Kuala Lumpur Kepong Berhad  External Planting Advisor, Kumpulan Guthrie Berhad  Rubber Inspector, RISDA Pahang, Malaysia.

Involvement in professional organizations  Associate member of Incorporated

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Society of Planters  Chairman MPOA ( Branch)  Vice-Chairman MPOA (Negeri Sembilan Branch)  Vice Chairman of Pahang Planters Association  Chairman of ISP West Pahang Branch

 10 days of auditing experience in RSPO.  Over 50 days of auditing experience FSC and forest management certifications under the MTCS  Successfully completed EARA approved Lead Assessor training for ISO 14001 in 2009  Attended a training on FSC P&C and MC&I for FMC in December 1999  Attended Auditor Training Course on MC&I for Forest Management Assessor / Social Certification, 2009 Dr. Lim Hin Fui issues and related legal issues  Attended Auditor Training Course on MC&I for Forest Management Certification (MC&I Forest Plantation), 2009  Attended a training on RSPO P&C and certification requirements in November 2010 & April 2012  Head of Policy and Socio-Economic Branch, Forest Research Institute Malaysia  Ph. D in Social Sciences, Universiti Malaya

 7 years experience in Forest related areas as a researcher with FRIM since 2003

 Over 50 days of auditing experience,

having audited on ISO 14001 EMS and

RSPO.

 Over 50 man-days in auditing

MC&I(2002) as forest auditor

 Successfully Completed RSPO Lead Assessor Course - 2011 Khairul Najwan Assessor / HCV  Attended Auditor Training Course on Ahmad Jahari habitats & ecology Malaysian Criteria and Indicators for Forest Management Certification [MC&I(2002)] organized by MTCC,

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April 2009.  Attended Auditor Training Course on Malaysian Criteria and Indicators for Forest Plantation Certification [MC&I(2002)] organized by MTCC 2010.  Attended a training on RSPO P & C and certification requirements in January 2011  Successfully passed EMS 14001: 2004 Lead Auditor Course, March 2009.  Successfully passed OHSAS 18001: 2007 Lead Auditor Course, Feb 2009.  Successfully passed QMS 9001: 2008 Lead Auditor Course, Feb 2009.  B.Sc. of Forestry (Forest Management)  M Sc Environmental (GIS Remote Sensing, still pursuing)

2.4 Stakeholder Consultations

SIRIM QAS International Sdn Bhd (SIRIM QAS International) initiated the stakeholder consultation by announcing the invitation in the RSPO and SIRIM QAS International‟s websites on 15th November 2011. In addition, SIRIM QAS International had also sent invitations through letters to the relevant stakeholders, including government agencies and Non-Governmental Organizations (NGOs) on 15th November 2011. This was followed-up by telephone calls.

Whenever necessary, meetings with the relevant stakeholders were arranged during the on-site assessment. Please see Principle 6.

The consultation with the government agencies had involved meetings and discussions with the relevant departments mainly to solicit information as well as verification on the CU‟s compliance with the applicable laws and regulations related to its operations. More details of consultation can be found in Attachment 3.

The consultations with the NGOs were held to seek their comments mainly on the CU‟s compliance with those criteria related to the social and environmental issues.

The method of consultation with the employees, settlers and FFB contractors, FELDA staff, harvesters, general workers, sprayers and transporters from the estate/schemes involved were through random sampling. The consultations which were conducted at the CU‟s office had included solicitation of comments on issues relevant to principles 4, 5 and 6 of the RPSO MYNI.

The consultations with the local communities were held during the times that were convenient to them. The intention was to (a) understand whether they claim any customary land within the CU and (b) solicit their views on the impact of the Tementi CU‟s operations on their economics and socio-cultural lives.

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During the consultations, no management representatives from the CU were present. As such, the stakeholders had been able to present their views in a frank and open manner.

Following is the list of stakeholders who were consulted during the various stages of the assessment process:

Government Agencies/Service Providers/Associations

1. Department of Occupational Safety and Health (DOSH), Kuantan, Pahang 2. Department of Environment (DOE), Kuantan, Pahang 3. Pejabat Penghulu, Bera 4. Jabatan Kemajuan Orang Asli (JAKOA) – District of Bera, Pahang, Malaysia 5. Health Clinic, Bandar 32, Bera, Pahang, Malaysia 6. Ramsar site office, Tasek Bera. 7. Labour Department, Malaysia 8. Department of Agriculture (DOA), Malaysia 9. Immigration Department, Malaysia 10. District Health Office, Pekan, Pahang 11. Police, Bandar Chini 12. Auxiliary Police, FELDA Keratong 1, , Pahang 13. Perhilitan, 14. Public Works Department, Bera 15. Government Health Clinic, Bandar 32, Triang, Pahang 16. MPOB, Kuantan 17. TNB Distribution Sdn Bhd, 18. Department of Aboriginal Affairs, Bandar Bera, Pahang 19. Jabatan Agama Islam, Bera 20. Drainage and Irrigation Department of Kuantan 21. Department of Agriculture, Kuantan 22. Immigration Office of Kuantan 23. Fisheries Office of Kuantan 24. Forestry Department, Temerloh, Pahang 25. Police, Rentam 26. Fire and Rescue Department, District of Bera, Pahang

Non Government Organization

1. Malaysian nature Society 2. WWF Malaysia 3. Sahabat Alam Malaysia 4. Wetlands International 5. Tenaganita 6. National Union of Plantation Workers (NUPM) 7. All Malaysian Staff Union (AMESU)

Local Communities

1. Kampung Orang Asli Lubok , Bera, Pahang 2. Kampung Orang Asli Lubok Tambangan, Bera, Pahang 3. Kampung Orang Asli Guyah, Bera, Pahang 4. Kampung Orang Asli Lenguit, Bera, Pahang

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Other Interested Parties: 1. D‟Mart shop manger (Felda Trading Sdn Bhd), Ladang FELDA Bera Selatan 4, Bera 2. Kesatuan Pekerja-Pekerja Felda Palm Industries Sdn. Bhd., Cawangan Kilang Sawit Felda Tementi 3. Tabika Kemas, Ladang FELDA Bera Selatan 4 4. Persatuan Wanita Bera Selatan 4 5. Tementi POM - office staff and operator 6. Tementi POM - Union Representative 7. Tementi POM - chemical store in-charge 8. Tementi POM - safety commitee 9. FELDA Rentam - chemical handler 10. FELDA Tementi - harvesters 11. FELDA Tementi - general workers 12. FELDA Sebertak - chemical handler 13. FELDA Sebertak - general workers 14. FFB transporter 15. Chemical Supplier 16. Provision Shop Operator

3.0 ASSESSMENT FINDINGS

The findings of the assessment were highlighted and discussed during the on-site assessment. There was one minor nonconformity report (NCR) being raised on the Tementi CU‟s against the requirements of the RSPO MYNI and eight opportunities for improvement, which the CU should improve upon in complying with the requirements of the RSPO MYNI.

The detailed findings of the assessment on the CU‟s compliance with the requirements of the RPSO MYNI are as follows:

PRINCIPLE 1: COMMITMENT TO TRANSPARENCY

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

Indicators: 1.1.1 Records of requests and responses must be maintained. Major compliance

Specific National Guidance for Scheme Smallholders Scheme Smallholders Scheme managers should assist in ensuring compliance by their organized smallholders in providing adequate information. Scheme managers must ensure that participant are given copies of:

-chemical use (4.6) -to-date records of debts and repayments, charges and fees (6.10)

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s are made available the following documents:

- Health and safety plan (4.7). - Plans and impact assessments relating to environmental and social impacts (5.1, 6.1, 7.1, 7.3). - Pollution prevention plans (5.6). - Details of complaints and grievances (6.3). - Negotiation procedures (6.4). - Procedure for calculating prices, and for grading, FFB (6.10) - Continuous improvement plan (8.1) confidential

Findings:

Through the FELDA website (www.feldaholdings.com), the public can access brief information about the company‟s structure, its policy and management objectives, corporate profile, vision mission and shared value, the business they are involved in, financial and corporate social responsibility information.

In addition, there is available procedure of communication in FELDA Palm Industries Sdn. Bhd. (FPISB) No. document: FPI/L2/QOHSE-6.0 entitlted Manual Prosedur Komunikasi, Penglibatan dan Rundingan (Communication, Participation and Consultation). It involves internal and external consultation.

During the assessment, it was observed that Tementi CU had compiled a list of local stakeholders that may be relevant to its operation. The letters to stakeholders and the records of request were sighted. Consultations with stakeholders start since March till December 2011 and sighted signed list of attendance.

Tementi CU was adjacent to Chini Forest Reserve which is having logging operations, and Tasik Bera that declared as RAMSAR Site. The stakeholder consultation was conducted with Forest Department and Management of RAMSAR Site on 2 December and 6 October 2011 respectively. The meeting with Wildlife also has been conducted on 2 November 2011. The meeting has discussed issues related HCV assessment and preventive action on elephant intrusion at Ladang FELDA Bera Selatan 4.

It was evident that Tementi CU had committed to be transparent in its dealings with internal and external stakeholders.

It was also evident that government agencies such as DOE, DOSH, the Labour Department and MPOB had regularly requested information relating to matters under their purview and the Tementi CU had always responded to these in a comprehensive and timely manner.

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. This concerns management documents relating to environmental, social and legal issues that are relevant to compliance with RSPO Criteria. Documents that must be publicly available include, but are not necessarily limited to:-

1.2.1 Land titles / user rights (C 2.2) 1.2.2 Safety and health plan (C 4.7) 1.2.3 Plans and impact assessments relating to environmental and social impacts (C 5.1, 6.1, 7.1, 7.3)

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1.2.4 Pollution prevention plans (C 5.6) 1.2.5 Details of complaints and grievances (C 6.3) 1.2.6 Negotiation procedures (C 6.4) 1.2.7 Continuous improvement plan (C 8.1)

Guidance: Examples of commercially confidential information include financial data such as costs and income, and details relating to customers and/or suppliers. Data that affects personal privacy should also be confidential.

Examples of information where disclosure could result in potential negative environmental or social outcomes include information on sites of rare species where disclosure could increase the risk of hunting or capture for trade, or sacred sites, which a community wishes to maintain as private.

Specific National Guidance for Scheme Smallholders Scheme Smallholders Scheme managers should ensure that appropriate systems are in place for their organized smallholders to comply with the above. This may include providing information that covers.

idence of legal ownership of the land or land-use rights; (certificate)

nt Plans

Findings:

The relevant management documents as required in this Criterion were made publicly available upon request. Each operating unit had maintained record of requests made by stakeholders and this record was presented during the assessment.

The assessment team had verified copy of the land titles for Ladang FELDA Bera Selatan 1 and Ladang FELDA Bera Selatan 4 as well as FELDA Tementi, FELDA Rentam and FELDA Sebertak. These documents were kept in the FELDA Headquarter Office at Kuala Lumpur and copy were made available at respective operating unit.

The operating unit visited had documented their (a) health and safety plan, (b) plans of social impact assessment, and (c) pollution plan, (d) procedure for calculating prices, and for grading and they are made publicly available for viewing including some being displayed at notice board. Also, standard operation procedures are also available. Among those sighted include negotiation procedures, complaints and grievances, and information on HCV and actions taken to manage them including dissemination of information to settlers and the public at large.

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

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Indicators: 2.1.1 Evidence of compliance with legal requirements. Major compliance

2.1.2 A documented system, which includes written information on legal requirements. Minor compliance

2.1.3 A mechanism for ensuring that they are implemented. Minor compliance

2.1.4 A system for tracking any changes in the law. Minor compliance

Guidance: 1. Lists down all applicable laws including international laws and conventions ratified by the Malaysian government. 2. Identify the person(s) responsible to monitor this compliance. 3. Display applicable licenses and permits. 4. Unit responsible to monitor these will also be responsible to track and update changes.

Specific National Guidance for Scheme Smallholders Scheme Smallholders Scheme managers should ensure that their organized smallholders are aware of and comply with relevant legal requirements.

These would require provision of information regarding relevant legal requirements to the participants or their appointed representatives.

Findings:

Tementi CU had documented a list of all the applicable laws and regulations relevant to its operations. Among the laws which had been identified and recorded in the register were Pesticides Act 1974 and Regulations, Environmental Quality Act 1974 and Regulations, Factories and Machinery Act 1967and Regulations, Occupational Safety and Health Act 1994, Employment Act 1955, Immigrations Act 1959/1963, Workers‟ Minimum Standards of Housing and Amenities Act, 1990 and WHO Type 1A and 1B or Stockholm & Rotterdam Conventions.

As required by the criterion, copies of relevant licenses and permits were displayed appropriately in the mill and estate offices. Inspection by the assessors had found that all of them were still valid. Among the licenses and permits being displayed were MPOB License, Energy Commission License, permits to keep fertilizer and diesel, the purchase and storage of CPO and PK and the approval condition for mills operation.

Tementi CU had established a documented procedure for tracking changes in the laws. The procedure had also addressed the means to monitor compliance status and identified the person-in-charge of monitoring the CU‟s compliance with all the relevant laws. The commitment to ensure the CU had complied with all the legal requirements was verified during the assessment.

With respect to the terms and conditions of employment, the assessment team has verified that the Tementi CU was in compliance with the Employment Act 1955 related to the provisions of wages, paid public holidays, paid annual leave and sick leave.

Tementi POM has installed one unit of steam boiler complete with air pollution control facilities i.e multi dust cyclone, namely boiler no. 3. The assessment team has verified an approval

Page 16 of 83 document from Department of Environment‟s (DOE) dated 11 January 2011 (Reference .number: C31/152/000/019 SK 1 (24)). The mill had continuously been monitoring dark smoke emission via smoke density meter and CEMS (Continuous Emission Monitoring System) while dust particulate/stack sampling was monitored half yearly by external independent laboratory. Assessment on the records of boiler air emission i.e. dark smoke and dust particulate shows that emission readings were below Ringelmann Chart no.2 and 0.4 g/Nm3 respectively. The air emission monitoring records were submitted to DOE accordingly.

Photo 1: Tementi Palm Oil Mill Boiler stacks

Photo 2 : Tementi POM – Computerized system to monitor boiler operation

Tementi POM also maintained its compliance related to mill effluent discharges. As a commitment to ensure legal compliance, in 12 March 2010, the mill has obtained an approval from DOE to enhance the performance of its Effluent Treatment Plant (ETP). No sign of effluent

Page 17 of 83 overflow into the water streams was observed during the site visit to the effluent treatment plant. All the effluent ponds and drainage were well maintained.

Assessment team has also verified the in-house and external accredited laboratory effluent analysis result. The analysis result shows all parameters tested were within the specification of annual license issued by DOE.

Evidences such as the record of periodic inspection by the Department of Occupational Safety & Health (DOSH) on boilers, un-fired pressure vessels and hoisting machines were available and found satisfactory. Certificate of fitness for all registered machineries were valid and its registration number example PH PMT 3754 for air compressor and PMD 611 for boiler was displayed on the machine.

Photo 3 : Registration number was displayed on the machines (From left – air compressor and From right – Boiler)

Criterion 2.2 The right to use the land can be demonstrated, and is not legitimately contested by local communities with demonstrable rights.

Indicators: 2.2.1 Evidence of legal ownership of the land including history of land tenure. Major compliance

2.2.2 Growers must show that they comply with the terms of the land title. [This indicator is to be read with Guidance 2] Major compliance

2.2.3.1 Evidence that boundary stones along the perimeter adjacent to state land and other reserves are being located and visibly maintained. Minor compliance

Specific Guidance: Growers should attempt to comply with the above indicator within 15 months from date of announcement of first audit. Refer to State Land Office for examples of other reserves.

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2.2.3.2 Where there are, or have been, disputes, proof of resolution or progress towards resolution by conflict resolution processes acceptable to all parties are implemented. Cross ref. to 2.3.3, 6.4.1 and 6.4.2. Minor compliance

Guidance: 1. For any conflict or dispute over the land, the extent of the disputed area should be mapped out in a participatory way. 2. Where there is a conflict to the condition of land use as per land title, growers must show evidence that necessary action has been taken to resolve the conflict with the relevant authorities. 3. Ensure a mechanism to solve the dispute (Refer to C 6.3 and C6.4) 4. Evidence must be demonstrated that the dispute has been resolved. 5. All operations shall cease on land planted beyond the legal boundary.

Specific National Guidance for Scheme Smallholders Scheme Smallholders Scheme Managers should ensure that:

allocated.

The management should facilitate in processing/procuring land ownership for their participants.

Findings:

The legal ownership of land title for Tementi CU has been verified i.e.estate name, title number term of title, total hectarage and validity period. The status of land title was duly checked. Based on document review, it was confirmed that the specific terms of the land title for oil palm cultivation has been duly complied by the 3 smallholders schemes and the 2 plantations.

Site review has confirmed that all the boundary stones had been visibly maintained for each plantation and smallholders scheme. It was found that the boundary stones along the perimeter adjacent to state lands and other reserves were well displayed and visibly marked with additional wooden pegs. The pictures below showed the Tementi CU has maintained the boundary stones well, especially those adjacent to Forest Reserves.

The assessment team has confirmed there were no land dispute at Tementi CU.

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Photo 4: Boundary mark Ladang FELDA Bera Selatan 4 adjacent with Chini Forest Reserve

Photo 5 : Boundary stone at Felda Sebertak

Photo 6 : Map of Boundary stone at Ladang FELDA Bera Selatan 1

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Photo 7 : Map of Boundary stone at Ladang FELDA Bera Selatan 4

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

Indicators: 2.3.1 Where lands are encumbered by customary rights, participatory mapping should be conducted to construct maps that show the extent of these rights. Major compliance

2.3.2 Map of appropriate scale showing extent of claims under dispute. Major compliance

2.3.3 Copies of negotiated agreements detailing process of consent (C2.2, 7.5 and 7.6). Minor compliance

Guidance: Where lands are encumbered by legal or customary rights, the grower must demonstrate that these rights are understood and are not being threatened or reduced. This criterion should be considered in conjunction with Criteria 6.4, 7.5 and 7.6.

Where customary rights areas are unclear these are best established through participatory mapping exercises involving affected and neighbouring communities.

This criterion allows for sales and negotiated agreements to compensate other users for lost benefits and/or relinquished rights. Negotiated agreements should be non-coercive and entered into voluntarily, carried out prior to new investments or operations and based on an open sharing of all relevant information in appropriate forms and languages, including assessments of impacts, proposed benefit sharing and legal arrangements.

Communities must be permitted to seek legal counsel if they so choose. Communities must be represented through institutions or representatives of their own choosing, operating transparently and in open communication with other community members.

Adequate time must be given for customary decision-making and iterative negotiations allowed for, where requested. Negotiated agreements should be binding on all parties and enforceable in the courts. Establishing certainty in land negotiations is of long-term benefit for all parties.

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Specific National Guidance for Scheme Smallholders Scheme Smallholders 8 Scheme managers can show that lands acquired for participants do not diminish legal or customary rights. Where other customary lands have been taken-over, there is documentary proof of transfer of rights (eg sale) or payment of agreed compensation.

Findings:

Orang Asli Semelai at Kg Lubuk Perak and Kg. Lubok Tambangan, (both outside Felda Plantation Bera 1), Kg. Guyah and Kg. Lengut (both outside Felda Plantation Bera 4) did not claim any customary land within Felda area. Generally, these Orang Asli villagers cultivate rubber, oil palm and fruit trees on their traditional land. The Orang Asli at the latter two villages were migrants from Pos Iskandar about 20-30 years ago. Currently, residents in these four villages cultivate rubber and oil palm in their own customary lands outside Felda areas. Assessment consultations with the villages showed that their use of customary land is not threatened or reduced by Felda areas.

The Orang Asli communities also had an agreement entitled Perjanjian Persefahaman Menggunakan Jalan Pertanian Ladang Bera Selatan 04 with Felda Plantations Sdn Bhd on the use of Felda resources.

PRINCIPLE 3: COMMITMENT TO LONG-TERM ECONOMIC AND FINANCIAL VIABILITY

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

Indicators: 3.1.1 Annual budget with a minimum 2 years of projection Major compliance

Specific Guidance: Annual budget may include FFB yield/ha, OER, CPO yield/ha and cost of production that is not required to be publicly available.

3.1.2 Annual replanting programme projected for a minimum of 5 years with yearly review. Minor compliance

Guidance: Individual organization is to define its own management unit i.e. mill, estate or group as per definition on unit of certification explained in Item 4.2.3 and 4.2.4 in the RSPO Certification Systems document located at: http://www.rspo.org/RSPO_Certification_Systems.aspx

Specific National Guidance for Scheme Smallholders Scheme Smallholders Scheme managers have a documented management plan (minimum 2 years) which is shared with them or their elected representatives.

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Findings:

The budget for financial year 2012 is available for Tementi CU. It included capital and operating expenditures with attention given to crop projection, mill extraction rates, FFB yield trends, cost of production, cost per tonne of CPO trends financial indicators to monitor the performance of each operating unit. The cost of production is reviewed and compared against expenditure each year with projections in place for future years.

Others include the provision of allocation for Mill and Estate operations and maintenance covering upkeep of plant & machineries, agriculture equipment & vehicle, office equipment, housing & amenities, as well as land & infrastructure. Budget for continuous improvement projects have been addressed, for examples, training, occupational safety and health (construction of new chemical store at FELDA Tementi), environmental upkeep (reduced, reuse and recycle) and for welfare and social activities for settlers and workers.

Assessment on the records at FELDA Rentam shows replanting of all old palms was completed with the planting of 2029.01 ha. in 2009 and the other field in 2006. FELDA Rentam had completed all replanting of uneconomic fields and there will be no more replanting for the next 10 years.

For Ladang FELDA Bera Selatan 4, annual replanting programme projected for a minimum of 5 years was available refer table below.

LADANG BERA SELATAN 04 : PROGRAM TANAM SEMULA ( 5 TAHUN )

PERINGKAT TAHUN HEKTAR 2013 2014 2015 2016 2017 JUMLAH TANAM PM 90 A 1988 1621.29 - - 288.6 301.35 526.39 1116.34 PM 91 B 1989 245.68 ------PM 90 E 1988 350.12 - - - 350.12 - 350.12 PM 99 F 1992 493.4 ------PM 00 D 2002 200.66 ------

JUMLAH 2911.15 288.6 651.47 526.39 1466.46

PRINCIPLE 4: USE OF APPROPRIATE BEST PRACTICES BY GROWERS AND MILLERS

Criterion 4.1 Operating procedures are appropriately documented and consistently implemented and monitored.

Indicators: 4.1.1 Documented Standard Operating Procedures (SOP) for estates and mills Major compliance

4.1.2 Records of monitoring and the actions taken are maintained and kept for a minimum of 12 months. Minor compliance

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Findings:

FELDA Operation Manual and Oil Palm Management Procedures was sighted and is comprehensive covering all Good Agricultural Practices and standard operations. All documented procedures were available in Bahasa Malaysia and has been communicated to the scheme members through muster ground and meeting. The documents also given to every scheme block leaders. Periodic field inspection and records on verification were related to fertilizer application, weed management, pest control and agronomic report was carried out by management team.

Through random interview with the executives and field staffs, it was evident that they were conversant and were guided with all aspects of the Operation Manual particularly planting methods, nursery techniques, mature and immature fields maintenances, harvesting and disease control.

It was also noted that safe usage of chemicals was emphasized. Usage of chemicals were recorded in stocks indent and issue books

Documented procedure for management of domestic waste was established but the specific criteria to select the disposal site was not addressed (refer OFI).

Photo 8 : Documented SOP available at Tementi CU

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Photo 9 : Tementi Palm Oil Mil

Criterion 4.2 Practices maintain soil fertility at, or where possible improve soil fertility to, a level that ensures optimal and sustained yield. MY-NIWG recommends that the indicators in criterion 4.2 and 4.3 are linked

4.2.1 Monitoring of fertilizer inputs through annual fertilizer recommendations. Minor compliance

4.2.2 Evidence of periodic tissue and soil sampling to monitor changes in nutrient status. Minor compliance

4.2.3 Monitor the area on which EFB, POME and zero-burn replanting is applied. Minor compliance

Guidance: Long-term fertility depends on maintaining the structure, organic matter content, nutrient status and microbiological health of the soil. Managers should ensure that best agricultural practice is followed. Nutrient efficiency must take account of the age of plantations and soil conditions.

Findings:

Fertilizer recommendation was made by Felda Agriculture Services Sdn. Bhd . after conducting a comprehensive foliar analysis. Recommendation was based on foliar analysis conducted in 2010. Assessment team has verified that Tementi CU has completed their fertilizer application based on the recommendation. Foliar and soil sampling was carried out annually and once in five years respectively. The assessment team has sighted the report and concludes that soil was found to be suitable for oil palm planting. Soil map for Ladang Bera Selatan4, Ladang Rentam and Ladang Tementi as in Attachment 5a,5b & 5c.

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EFB interrow application at the rate of 40 tonnes per ha were sighted in mature fields of 2006 in Rentam Estate.

Photo 10 : EFB interrow application at Rentam Estate

POME were discharged into wáter stream as stated in the DOE licence ( Licence No : 004367). The allowable limit for Bio Oxygen Demand (BOD) is not more than 100mg/l. parameter and Tementi mil has maintained its compliance for POME discharge i.e the average BOD Reading is 41 mg/l . Weekly POME analysis was carried out by SAMM accreditation laboratory and signed by registered chemist. Mill has submitted the analysis report to DOE accordingly. The assessment team had confirmed there was no POME application in the fields in Tementi and other schemes which were too far away from the Tementi mill.

Zero burning is the company‟s policy and no sign of burning activities was sighted during site inspection. This was evidenced by some traces and remnants of decomposed shredded trunk chips in the fields visited.

No bare ground condition was sighted except for Ladang Tementi replants where blanket spraying was carried out prior to cover-crop planting.

Criterion 4.3 Practices minimise and control erosion and degradation of soils.

Indicators: 4.3.1 Documented evidence of practices minimizing soil erosion and degradation (including maps). Minor compliance

Specific Guidance: Replanting on sloping land must be in compliance with MSGAP Part 2: OP (4.4.2.2) For , steep slopes are considered high risk erosion areas and cannot undergo replanting unless specified in the EIA report and approved by the Natural Resources and Environment Board (NREB).

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For , slopes 25 degree and steeper are considered high risk erosion areas and cannot undergo replanting unless specified in the EIA report [Environment Protection (Prescribed Activities)(Environment Impact Assessment) Order 2005] and approved by the Environmental Protection Department (EPD). Slope determination methodology (slope analysis) should be based on average slope using topographic maps or topographical surveys.

4.3.2 Avoid or minimize bare or exposed soil within estates. Minor compliance

Specific Guidance: Appropriate conservation practices should be adopted.

4.3.3 Presence of road maintenance programme. Minor compliance

4.3.4 Subsidence of peat soils should be minimised through an effective and documented water management programme. Minor compliance

Specific Guidance: Maintaining water table at a mean of 60 cm (within a range of 50-75cm) below ground surface through a network of weirs, sandbags, etc. in fields and watergates at the discharge points of main drains.

4.3.5 Best management practices should be in place for other fragile and problem soils (e.g. sandy, low organic matter and acid sulphate soils). Minor compliance

Guidance: Techniques that minimise soil erosion are well-known and should be adopted, wherever appropriate. These may include practices such as: 1. Expediting establishment of ground cover upon completion of land preparation for new replant. 2. Maximizing palm biomass retention/ recycling. 3. Maintaining good non-competitive ground covers in mature areas. 4. Encouraging the establishment/regeneration of non-competitive vegetation to avoid bare ground. 5. Construction of conservation terraces for slopes >15o 6. Advocating proper frond heap stacking such as contour/L-shaped stacking. for straight line planting and stacking along the terrace edges for terrace planting. 7. Appropriate road design and regular maintenance. 8. Diversion of water runoff from the field roads into terraces or silt pits. 9. Construction of stop bunds to retain water within the terrace. 10. Maintaining and restoring riparian areas in order to minimize erosion of stream and river banks.

Findings:

Terraces were constructed in all plantings on land with 50 to 150 gradient in conformity with the Planting Manual. The assessment team has verified the topograhic maps and inspection at site confirmed that there was no planting on terrain exceeding 250 .

Water conservations pits were sighted in field 2001 and 2002 Tementi. It was noted that the number of water conservation pits in both Rentam and Tementi need to be increased to be more effective. Therefore, Tementi CU needs to consider to construct 18” width X 18” depth X 6‟ long conservation pits at every alternative interpalm space.

Generally, there was emphasis of cover crop planting. Although the cover crop planted is satisfactory, it is expected to give adequate ground coverage within 4 months. Hence, at the time of audit , it was not posible to verify an adequate cover crop planting functioning to minimise soil erosion (Refer OFI). It was observed some settlers do not carry out cover crop

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planting due to costing. Hence cover crop sighted vary from nil to good coverage in Tementi and Rentam.

It was reckoned that frond stacking needs to be improved to function as effective water and soil conservation techniques.

Road maintenance programmes i.e. grading, resurfacing and compaction with red earth/laterites were drawn up and were completed as programmed. It was also observed that, off shoots in the form of diversión drains were constructed in áreas of high side flow during heavy rains. It was observed overall harvesting roads condition were satisfactory and road site drains were constructed to address water runoff.

It was noted that there was no peat soil in the estate except for colluvial and alluvial soils that occur in the ravines and low lying flats in both Rentam and Tementi.

Criterion 4.4 Practices maintain the quality and availability of surface and ground water. Indicators: 4.4.1 Protection of water courses and wetlands, including maintaining and restoring appropriate riparian buffer zones at or before replanting along all natural waterways within the estate. Major compliance

Specific Guidance: Riparian buffer zones: Reference to be made to relevant national regulations or guidelines from state authorities e.g. Department of Irrigation and Drainage (DID), whichever is more stringent.

4.4.2 No construction of bunds/weirs/dams across the main rivers or waterways passing through an estate. Major compliance

4.4.3 Outgoing water into main natural waterways should be monitored at a frequency that reflects the estates and mills current activities which may have negative impacts (Cross reference to C 5.1 and 8.1). Major compliance

4.4.4 Monitoring rainfall data for proper water management. Minor compliance

4.4.5 Monitoring of water usage in mills (tonnage water use/tonne FFB processed). Minor compliance

Specific Guidance: Data trended where possible over 3 years to look into resource utilization

4.4.6 Water drainage into protected areas is avoided wherever possible. Appropriate mitigating measures will be implemented following consultation with relevant stakeholders. Minor compliance

4.4.7 Evidence of water management plans. Minor compliance

Findings:

During site visit to Felda Sebertak, it was noted that the buffer zone has been identified along the Sebertak River with green and white layered colour pole. It was observed that there was no spraying activities in the buffer zone at Sebertak River. However, it was noted that recently Drainage and Irrigation Department had carried out river maintenance in the area.

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Photo 10 : Buffer zone along the Sebertak River in Felda Sebertak

During the on-site assessment, assessors did not see any weirs/dams being constructed across the main rivers or waterways passing through the Tementi CU.

The water quality index (WQI) for a sampled stream in Tementi CU i.e Ladang FELDA Bera Selatan 4, FELDA Tementi and FELDA Sebertak were monitored at the point of entrance (or inlet) to the estate and at the point where the streams flow out (outlet) of the estate. The samples were sent to Jabatan Kimia Malaysia for analysis annually. The sampling points are marked in the map of estate. It was found that the results of the quality of the water samples were within the acceptable level quality index of class III category in accordance with the Interim National Water Quality Standard 2006 (INWQS) of the DOE.

Rainfall recorded daily covering rainfall (mm) and days and at an annual rainfall of +1800mm which was adequate for oil palm planting.

The average of Tementi mill water usage was 1.0 tonne water per tonne FFB processed. Tementi CU had established and documented their wáter management plan. Among the water management plan include inspection of water pipeline to detect water leakage, installed water meter at water treatment plant at the mill and to monitor water usage.

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Criterion 4.5 Pests, diseases, weeds and invasive introduced species are effectively managed using appropriate Integrated Pest Management (IPM) techniques.

Indicators: 4.5.1 Documented IPM system. Minor compliance 4.5.2 Monitoring extent of IPM implementation for major pests. Minor compliance

Specific Guidance: Major pests include leaf eating caterpillars, rhinoceros beetle and rats.

4.5.3 Recording areas where pesticides have been used. Minor compliance 4.5.4 Monitoring of pesticide usage units per hectare or per ton crop e.g. total quantity of active ingredient (a.i.) used/ tonne of oil. Minor compliance

Guidance: Growers should apply recognised IPM techniques, incorporating cultural, biological, mechanical or physical methods to minimise use of chemicals. Native species should be used in biological control wherever possible.

Findings:

Documented IPM had been established (refer C 4.1) and the major pest identified was rhinoceros beetle. Training related to pest control had been conducted 15 June 2011 at Rentam, 11 Mei 2011 at Tementi, 27 September 2011 at Sebertak to field staff and pest control workers. It was noted that Metarhizium anisopliae was used to control rhinoceros beetle.

Based on data collection, application of Metarhizium anisopliae is less effective. Therefore, setting up of pheromone traps and spraying of Blocus insecticide were implemented to enhance the control on rhinoceros beetle damage. Tementi CU has also monitored the pesticide usage units per hectare or per ton crop e.g. total quantity of active ingredient (a.i.) used/ tonne of oil.

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Figure 3: Pesticide usage per hectare at Rentam

Figure 4: Pesticide usage per hectare at Tementi

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IPM practices have been implemented and beneficial plants (turnera and cassia) were planted. Although beneficial plants are sighted in the fields, they are still insufficient and hence more intensive planting is required (Refer OFI).

It was found that there was no history of bagworm or nettle caterpillar infestation. However, barn owl boxes were introduced at a ratio of 1 to 15 ha to control the rat population and the occupancy rate was at 60%. Based on the rat damage census it was found that the damage is below the threshold limit. Bromodiolone rat baits were also used to complement the control of rats. The numbers of rat campaign depends on severity of the damage and uptake of applied baits.

Photo 11: A barn-owl box at FELDA Rentam

It was found that the issuance of chemicals for uses was recorded in the issues records and location of usage has been indicated. The agrochemicals used was mainly Glyphosate and based on interview with workers and assessment on the chemical usage records showed the agrochemical application was carried out in accordance with recommended dosage.

Field staff & store keeper had kept records on the location, quantity & type of pesticide that has been applied in their cost book. Additionally, the estate had maintained the records of agrochemicals being used based on per hectare and per mt tonne of CPO.

Criterion 4.6 Agrochemicals are used in a way that does not endanger health or the environment. There is no prophylactic use of pesticides, except in specific situations identified in national Best Practice guidelines. Where agrochemicals are used that are categorised as World Health Organisation Type 1A or 1B, or are listed by the Stockholm or Rotterdam Conventions, growers are actively seeking to identify alternatives, and this is documented.

Indicators: 4.6.1 Written justification in Standard Operating Procedures (SOP) of all agrochemicals use. Major compliance

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4.6.2 Pesticides selected for use are those officially registered under the Pesticides Act 1974 (Act 149) and the relevant provision (Section 53A); and in accordance with USECHH Regulations (2000). Major compliance

Specific Guidance: Reference shall also be made to CHRA (Chemical Health Risk Assessment)

4.6.3 Pesticides shall be stored in accordance to the Occupational Safety and Health Act 1994 (Act 514) and Regulations and Orders and Pesticides Act 1974 (Act 149) and Regulations. Major compliance

Specific guidance: Unless participating in established recycling programmes or with expressed permission from the authorities, triple rinsed containers shall be pierced to prevent misuse. Disposal or destruction of containers shall be in accordance with the Pesticide Act 1974 (Act 149) and Environmental Quality Act 1974 (Scheduled Wastes) Regulations 2005.

4.6.4 All information regarding the chemicals and its usage, hazards, trade and generic names must be available in language understood by workers or explained carefully to them by a plantation management official at operating unit level. Major compliance 4.6.5 Annual medical surveillance as per CHRA for plantation pesticide operators. Major compliance 4.6.6 No work with pesticides for confirmed pregnant and breast-feeding women. Major compliance 4.6.7 Documentary evidence that use of chemicals categorised as World Health Organisation Type 1A or 1B, or listed by the Stockholm or Rotterdam Conventions and paraquat, is reduced and/or eliminated. Adoption of suitable economic alternative to paraquat as suggested by the EB pending outcome of the RSPO study on IWM. Minor compliance 4.6.8 Documented justification of any aerial application of agrochemicals. No aerial spraying unless approved by relevant authorities. Major compliance 4.6.9 Evidence of chemical residues in CPO testing, as requested and conducted by the buyers. Minor compliance 4.6.10 Records of pesticide use (including active ingredients used, area treated, amount applied per ha and number of applications) are maintained for either a minimum of 5 years or starting November 2007. Minor compliance

Findings:

Chemical usage was in compliance to Standard Operating Procedure. All chemicals used based on records sighted during the assessment were of class IV category. E.g. Glyphosate, Ally and were in compliance against Pesticide Act 1974.

Use and storage of agrochemicals including pesticides were observed to be in accordance with Pesticides Act 1974, USECHH Regulations 2000 of the Occupational Safety & Health Act 1994. References had been made to Chemical Health Risk Assessment (CHRA). The store had been well ventilated and secured. In addition, a notice board was displayed in front of the store, which stated that prior to entrance of the chemical store, operators were required to switch on the fan for 10 minutes prior to entry, and entrance to store must be with required PPE. Only authorized personnel (storekeeper) were allowed to enter the chemical store and issue out the chemicals.

The pesticide containers were handled in accordance with applicable laws and stored as per required regulations in sure áreas with up to date inventory records. The empty/used chemical containers were triple rinsed and pierced to prevent the workers from taking them for domestic

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use. An information on the chemical and its usage, hazards, trade and generic names were made available in Bahasa for the benefits of the workers.

Annual medical surveillance checks had been carried out for all pesticide sprayers and chemical handlers.

Based on site visit and interview conducted had shown that no pregnant and breast feeding woman were employed for spraying. All spraying work was carried-out by man only.

There was no application of aerial spray observed during site assessment and this was also confirmed by the Estate Managers. Chemical usage on both the amount and types were recorded in the chemical store book.

No class I or II chemicals were used on record for the last two years and there was no paraquat used for the last 12 months.

Evidence of chemical residues in CPO testing was conducted by the mill though no request by the buyers. Among the parameters tested were iron, copper & phosphorus.

Criterion 4.7 An occupational health and safety plan is documented, effectively communicated and implemented. Indicators: 4.7.1 Evidence of documented Occupational Safety Health (OSH) plan which is in compliance with OSH Act 1994 and Factory and Machinery Act 1967 (Act139). Major compliance

The safety and health (OSH) plan shall cover the following: a. A safety and health policy, which is communicated and implemented. b. All operations have been risk assessed and documented. c. An awareness and training programme which includes the following specifics for pesticides: i. to ensure all workers involved have been adequately trained in a safe working practices ( See also C 4.8) ii. all precautions attached to products should be properly observed and applied to the workers. d. The appropriate personal protective equipment (PPE) are used for each risk assessed operation. i. Companies to provide the appropriate PPE at the place of work to cover all potentially hazardous operations such as pesticide application, land preparation, harvesting and if used, burning. e. The responsible person (s) should be identified. f. There are records of regular meetings between the responsible person(s) and workers where concerns of workers about health and safety are discussed. g. Accident and emergency procedures should exist and instructions should be clearly understood by all workers. h. Workers trained in First Aid should be present in both field and mill operations. i. First Aid equipment should be available at worksites.

4.7.2 Records should be kept of all accidents and periodically reviewed at quarterly intervals. Major compliance

Specific Guidance: Record of safety performance is monitored through Lost Time Accident (LTA) rate.

4.7.3 Workers should be covered by accident insurance. Major compliance

Findings:

The Tementi CU has adopted the FELDA Group‟s occupational safety and health policy. The policy had been communicated to all employees through briefings and being displayed on the

Page 34 of 83 mill and estates notice boards. A safety management plan for each operating unit had been established.

The management plan has addressed issues related to emergency, treatment of illness/injury during the job, compliance with regulations such as Occupational Safety and Health (Safety Committee) Regulations, Occupational Safety and Health (Notification Of Accident, Dangerous Occurrence, Occupational Poisoning And Occupational Disease) Regulations, Factory And Machinery (Steam Boiler And Unfired Pressure Vessel) Regulations and Factory and Machinery (noise exposure) Regulations.

The hazard identification, risk assessment and risk control had been carried out covering on the activities both in the estates and mill. Among the activities identified were FFB evacuation in the estates and transportation to the mill, chemical mixing and spraying, harvesting and potential occurrence of fire. For the mill, the identified activities were FFB sterilization, kernel and oil extraction, oil clarification, machine maintenance and working in confined space. Appropriate risk control measures had been identified and a person had been assigned to monitor the implementation of the control measures.

Evidence of implementation on the control measures was observed during the field and mill assessments. For example, at the mill, machines which have moving parts had been well guarded, emergency evacuation route marked and fire fighting facilities installed at strategic locations. In the estate, it was noted that eye wash, shower room and clothing cleaning facilities were made available for chemical sprayers at chemical mixing area. The chemical sprayers‟ PPE and spraying equipment were kept at designated area while their clothing are washed prior end of the shift.

PPEs that had been commonly used were safety boots, helmets, goggles, ear plugs, rubber and cotton gloves, aprons and breathing masks. Those who worked with chemicals had been trained on the use of PPE, material safety data sheet (MSDS) and safe chemical handling procedures. Although it was observed at site, that signage (to remind workers to wear appropriate PPE) was posted at the appropriate places, however, at Ladang Bera Selatan 4, it was observed that the contractor‟s workers constructing the chemical store did not wear appropriate shoes (Refer OFI).

The assessment team had verified the minutes of meeting of the safety committee which was held quarterly to discuss issues pertaining to workers‟ safety and health at work place. Training needs on safety and health aspects had been conducted. Among the training programmes conducted were those related to chemical handling and spraying, PPE, accident investigation and working in confined space. Attendance list on training was available and based on random interviews held with workers, it was confirmed that they had attended the training and had been aware on the safety and health issues related to their tasks.

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Photo 12 : First Aid box available at the Ladang Bera Selatan 4 Admin Office

It was observed that first aid box was provided to the field supervisors as well as made available at several strategic locations at the mill and chemical mixing areas. Random inspections on the first aid boxes in the different estates had found the contents of the first aid items as in accordance with the SOP

Photo 13 : Accident statistics at Ladang Bera Selatan 4

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Photo 14 : Accident statistics at Tementi Palm Oil Mill

Accident cases had been monitored and reported to the Department of Occupational Safety and Health (DOSH) by the Safety Officer. The Tementi CU had assured that all workers had been insured against accident. The assessment team has sighted the insurance documents and confirmed all workers had been insured against accident.

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

Indicator: 4.8.1 A training programme (appropriate to the scale of the organization) that includes regular assessment of training needs and documentation, including records of training for employees are kept. Major compliance

Guidance: Appropriate training should be given to all staff, workers and contractors by growers and millers to enable them to fulfill their jobs and responsibilities in accordance with documented procedures. All Estate Hospital Assistants (EHA) are trained on the chemicals used and related laws.

Findings:

The training programme for 2011 for both estates and mill were made available and the focus was mainly on safety and standard operating procedures. Budget had been allocated to conduct training related to environment, social, safety and good agricultural practice. Among the trainings which had been conducted were as follows:

 Chemical handling on 1st April 2011 at Rentam Estate  PPE for chemical handling on 8th September 2011 attended by chemical handler from Bera Selatan 1, Bera Selatan 4, Rentam and Tementi  The importance of buffer zone  Briefing on working in confined space  Safe operating procedure for chemical sprayers

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 Awareness on the Buffer zone and HCV  Refresher on the mill operation  Refresher on the GAP

It was observed that all training records had been properly filed. The records include information on the title of the training, name and signature of the attendees, name of the trainer, time and venue. Based on interviews held with workers from the spraying, manuring, harvesting and mulching operations, it was revealed that generally the level of their understanding on these subjects and the training efficiency had been satisfactory.

Occasionally reminder training was also conducted during “roll-call” in the morning. Contractors had also been briefed on safety, environment and RSPO requirements upon commencement of work

The staff, smallholders and plantation workers such as the storekeepers, sprayers and fertilizer applicators interviewed had shown that they understood the hazards of the chemicals and the need to follow the safety procedures. The trade and generic names of the chemicals were made known to the workers through the MSDS training. The level of understanding on safety, health and environment varies between estates and was better at the mill.

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 continuous improvement.

Indicator: 5.1.1 Documented aspects and impacts risk assessment that is periodically reviewed and updated. Major compliance 5.1.2 Environmental improvement plan to mitigate the negative impacts and promote the positive ones, is developed, implemented and monitored. Minor compliance

Guidance: Non-restrictive format e.g. ISO 14001 EMS and/or EIA report incorporating elements spelt out in this criterion and raised through stakeholder consultation.

Findings:

The Tementi CU had conducted an environmental aspects and impact risk assessment for each of their operating unit. Records of risk assessment relating to the oil and kernel separation process, boiler operation, water and effluent treatment plant and waste management at the mill were sighted. While the records of assessment for the estates operation covered the chemical spraying and manuring activities, FFB harvesting and evacuation as well as waste management. Periodic review was carried out to capture any changes in the activities or legal requirements.

Environmental improvement plans to mitigate the identified negative impacts had been developed, documented and being implemented. Among the mill improvement plans include

Page 38 of 83 improving the quality of effluent discharged and boiler smoke emission. Although both parameter were within the DOE limit but as a commitment to continual improvement. The Tementi CU improvement plan also covers reduction of fuel consumption. Among the fuel reduction programs are to ensure mill and estate vehicles in good condition, no mill breakdown so as to minimize operation of stand-by diesel generator set. Tementi POM had established the environmental management plan to mitigate the negative impacts from its activities. However, upon site assessment it was observed that the free flow of waste water from EFB & boiler ash dumping area into monsoon drain no.1 was left unattended and unchecked. A nonconformity report was raised by the assessment team. Tementi POM has taken necessary corrective action to ensure no waste water from EFB and boiler ash dumping areas flows into the monsoon drain. Among the action taken, the mill ensure minimal stock of EFB and boiler ash and close monitoring of monsoon drains no 1 discharge. Analysis of effluent discharge was carried out weekly by SAMM accredited laboratory and parameters tested were pH, BOD, total solid, suspended solid, oil & grease, ammoniacal nitrogen and total nitrogen. Analysis result shows all parameters were within DOE limit while average reading of BOD since January 2011 till November 2011 was 41mg/l. Boiler smoke emissions are within shade no.2 of Ringelmann chart. The average mill fuel consumption was 0.75 liter per tonne FFB processed against their set target 0.7 liter per tonne FFB processed. While estate‟s environmental improvement plan mainly focus on spill control at chemical store, increasing the 3Rs initiatives and emergency preparedness. Assessment team has observed the implementation of the improvement plan at the mill and estate. The concrete oil spillage containment traps for diesel skid tanks were available in Ladang Rentam. For lubricant oil store and workshop, appropriate oil trap system had been constructed at the outlet of the monsoon drain. Secondary container/tray were also used during the pumping of diesel and workshop activity so as to ensure no spillage of oil onto the ground. While for agro- chemicals, the required sump was constructed at the drainage outlet of the chemical store for trapping any accidental spillage of chemicals. The assessment team has observed that chemical containers were not properly managed at the Tementi mill bio-polishing plant (Refer OFI).

Criterion 5.2 The status of rare, threatened or endangered species (ERTs) and high conservation value habitats, if any, that exists in the plantation or that could be affected by plantation or mill management, shall be identified and their conservation taken into account in management plans and operations.

Indicators: 5.2.1 Identification and assessment of HCV habitats and protected areas within landholdings; and attempt assessments of HCV habitats and protected areas surrounding landholdings. Major compliance 5.2.2 Management plan for HCV habitats (including ERTs) and their conservation. Major compliance 5.2.3 Evidence of a commitment to discourage any illegal or inappropriate hunting fishing or collecting activities, and developing responsible measures to resolve human-wildlife conflicts. Minor compliance

Specific Guidance: Identify ERTs and establish their conservation status based on national and state conservation schedules; and should provide evidence of attempts to do likewise for immediate adjacent areas. In the event that the conservation

Page 39 of 83 status of a species has not been assessed locally, the IUCN list should be used to determine and report conservation status. Management plans to include areas for improvement. Where appropriate, the above activities to be conducted involving relevant stakeholders

Findings:

The Sustainability Department, FELDA Agricultural Services Sdn Bhd had compiled information about the status of High Conservation Value (HCV) within and adjacent to Tementi CU. The HCV Assessment Report, completed in June 2011 covering FELDA Tementi, FELDA Rentam, FELDA Sebertak, FELDA Plantation Bera Selatan 1 and FELDA Plantation Bera Selatan 4. The HCV assessment had confirmed that there were no protected, rare, threatened or endangered species at Tementi CU. The Management Plan and Action Plan have been developed based on the assessment finding and consultation of related stakeholders.

The Tementi CU had inspected the sites and made a consultation with related stakeholders (e.g. RAMSAR site, Local communities) as well as government agencies (e.g. Wildlife Department, Forestry Department and JKOA) to confirm the presence of potential HCVs. Among the action plan is to continue communicate with relevant stakeholders to monitor any illegal activities within the areas. The consultation report has been maintained and verified by the assessment team.

The assessment team has consulted the District Forest Officer (DFO), at Temerloh District Forest Office and RAMSAR, Tasek Bera‟s person in charge on 20 December 2011 and 21 December 2011 respectively. Both officers confirmed that Tementi CU has consulted them on issues related HCV.

Specific sites had been identified in each of the estate for protection of their high conservation values (HCV). In general, there was no any significant HCV classification in the Tementi CU. There is only HCV4 for soil erosion control and water protection of the river including swamp area, HCV5 for local necessity like roads and HCV6 for local religious area. Tementi CU however identified surrounding sites with HCV1 for wetland conservation and HCV2 that bordering with Forest Reserve. Maps demarcating these HCV sites had also been included in the HCV assessment report.

For HCV1, the surrounding ecosystems as Forest Reserve and RAMSAR Site had been declared as protected areas. The Tementi CU consists of Felda Rentam, Felda Sebertak, Ladang FELDA Bera Selatan 1 and Ladang FELDA Bera Selatan 4 sites which have boundaries bordering the Chini Forest Reserve and Bera RAMSAR Site. The boundary areas have been inspected and found to be marked on maps and demarcated on ground.

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Photo 15: RAMSAR Tasek Bera Office

The HCV2 has been identified at Ladang Felda Bera Selatan 1 and Ladang Felda Bera Selatan 4 which borders the Chini Forest Reserve. There was incident of elephant encroachment into the estates, therefore trenches and fence were installed at the estate boundary. The HCV assessment report has identified this issue and management plan was established.

The most common sites were classified under HCV 4 for soil erosion control and water protection of the river including swamp area within the Felda Tementi, Felda Rentam, Ladang Bera Selatan 1 and Ladang Bera Selatan 4. It was observed that all the buffer zones had been protected with no spraying activities allowed. The assessment team had inspected the sites and confirmed no activity or traces of spraying activities in these areas.

Areas which provide local necessity like roads had been included as HCV5 such as Orang Asli Village surrounding of the Plantation. It was identified at Ladang FELDA Bera Selatan 1 bordered with 3 villages ie Kg Tambangan, Kg Lubuk Panjang and Kg Lubuk Perah, and Ladang FELDA Bera Selatan 4 bordered Kg Orang Asli Kuyah and Sg Legut.

Tementi CU has identified the HCV6 for local religious requirements i.e graveyard and mosque at FELDA Tementi, FELDA Rentam and FELDA Sebertak

Based on the HCV assessment report, the Tementi CU has taken action by providing the monitoring form to all related managers to monitor the HCVs area. However the monitoring form needs to be improved and communicated effectively to every manager (see OFI 5.2.2).

During the assessment, it was found the HCV Management and Action Plan had been prepared for each operating unit after the identification of the HVC areas. The management plan has been accepted by the assessment team for all related HCV areas.

During site inspection, signage on prohibition of hunting was observed at FELDA Sebertak and Ladang FELDA Bera Selatan 4. The signage had been erected at every road entrance to warn that no hunting activities were permitted in the areas.

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Photos 16 : Signage indicating No Hunting in FELDA Sebertak (L) and Ladang FELDA Bera Selatan 4 (R)

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

Indicators: 5.3.1 Documented identification of all waste products and sources of pollution. Major compliance 5.3.2 Having identified wastes and pollutants, an operational plan should be developed and implemented, to avoid or reduce pollution. Minor compliance

Specific Guidance: Schedule waste to be disposed as per EQA 1974 (Scheduled Wastes) Regulations, 2005. Reference to be made to the national programme on recycling of used HDPE pesticide containers. Municipal waste disposal as per local authority or district council in accordance to the Ministry of Health guidelines (i.e. specifications on landfills, licensed contractors, etc) or Workers‟ Minimum Standards of Housing and Amenities Act 1990 (Act 446).

5.3.3 Evidence that crop residues / biomass are recycled (Cross ref. C 4.2). Minor compliance

Specific Guidance: POME should be discharged in compliance with the Environmental Quality Act 1974 (Act 127) and Regulations. For Sabah and Sarawak, POME should be discharged according to the respective state policies.

Findings:

Tementi CU has identified and documented all waste generated from mill and estate operation. Among the identified wastes were general/domestic waste from labour line and office, scheduled waste from mill maintenance and laboratory activities, scrap metal from maintenance and renovation activities, crop residue/biomass such as fibre, shell, EFB and POME from mill operation while palm fronds, used vehicle tyres, empty chemical containers/bag, used engine and gear oil, old batteries and scrap metal from estate operation.

Tementi CU has also established and documented an operational plan to avoid or reduce pollution. The general/ domestic wastes were collected from the labour lines and office then disposed by burying them at designated disposal areas. The wastes segregation practice i.e.

Page 42 of 83 organic and non organic has been implemented prior to disposal. The domestic waste disposal site was located at about 3 km away from the line sites and at the required distance away from any rivers, streams and forest reserves. The dug pits would be covered with soil upon being fully filled with garbage. However, from random interview with staff/management team and site assessment at Tementi CU, the management of domestic waste was found to be inconsistent among the operating units. It was found that documentation of SOP was needed.

Photo 17. : Designated disposal area at Ladang FELDA Bera Selatan 4

The photograph above shows the active sites of designated disposal area visited by the assessors.

Based on the site visited at Tementi Palm Oil Mill, Tementi and Rentam , it was noted that the scheduled wastes were collected and stored in accordance with Environmental Quality (Scheduled Wastes) Regulations, 2005. Assessment on the scheduled waste records, showed that all scheduled wastes were disposed through a licensed contractor as required by the authority. Among the scheduled wastes collected by the Kualiti Kitar Alam Sdn.Bhd. are SW 305 used lubricant oil and SW306 used hydraulic oil.

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Photo 18 : Tementi POM - Signboard on emergency preparedness response if any spill of scheduled wastes

Although mill has dedicated area to store all their empty chemical containers used for ETP operation it was found that the housekeeping needed to be improved.

Most of the scrap irons were sold to vendors while crop residue/biomass would be used for mill and estate operation.

The EFB was sent to estate as fertilizer as well as burnt in the incinerators while treated effluent was discharged to the stream as per DOE approval condition.

Generation of the identified wastes has been recorded and monitored on a monthly basis. The identified waste has been describe in Paragraph 1 of C 5.3

Criterion 5.4 Efficiency of energy use and use of renewable energy is maximized.

Indicators: 5.4.1 Monitoring of renewable energy use per tonne of CPO or palm product in the mill. Minor compliance 5.4.2 Monitoring of direct fossil fuel use per tonne of CPO or kW per tonne palm product in the mill (or FFB where the grower has no mill Minor compliance

Guidance: To establish baseline values and observe trends within appropriate time-frame. Growers and millers should assess the energy use including fuel and electricity, and energy efficiency of their operations. The feasibility of collecting and using biogas, biodiesel and biofuels should be studied if possible.

Findings:

Tementi CU was committed to use renewable energy in the mill. As such, fibre and nutshell had been used as boiler fuel to generate steam for mill process. The usage of fibre and nut shell was being monitored and records were being maintained. The estimated total quantities of fiber

Page 44 of 83 and shell burned in the mill boiler, (Jan-Dec 2011) is 245,529 tonne and energy generated is 58,613,800 kWh and CPO produced is 52,670.96 tonne, therefore average renewable energy used is 1,112.82 kWH/mt CPO produced. The average direct fossil fuel is 3.27 liter per mt CPO produced.

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

Indicators: 5.5.1 No evidence of open burning. Where controlled burning occurs, it is as prescribed by the Environmental Quality (Declared Activities) (Open Burning) Order 2003. Major compliance

5.5.2 Previous crop should be felled/mowed down, chipped/shredded, windrowed or pulverized/ ploughed and mulched. Minor compliance

Specific Guidance: A special dispensation from the relevant authorities should be sought in areas where the previous crop or stand is highly diseased and there is a significant risk of disease spread or continuation into the next crop.

5.5.3 No evidence of burning waste (including domestic waste). Minor compliance

Findings:

It was verified during the assessment through site visits, interviews and records that no open burning had been carried out in line with theTementi CU‟s policy on zero burning. The Scheme and Plantation Managers had carried out training and provided extension support to their participants to avoid open burning. It was evident that at the line site garbage collection contractors came to collect the household refuse.

In the replanting areas at FELDA Tementi and FELDA Rentam, it was observed that Tementi CU had felled, chipped and windrow stacked its previous oil palm trunks. The chipped trunks would later be used to mulch the newly replanted palms in that area.

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

Indicators: 5.6.1 Documented plans to mitigate all polluting activities (Cross ref to C 5.1). Major compliance 5.6.2 Plans are reviewed annually. Minor compliance

Specific Guidance: Pollutants and emissions are identified and plans to reduce them are developed in conformance to national regulations and guidance.

5.6.3 Monitor and reduce peat subsidence rate through water table management. (Within ranges specified in C 4.3). Minor compliance

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Findings:

Tementi CU has established documented management plans to reduce pollution and emissions. The management plan has been reviewed annually. Among the planned actions were the reduction of effluent and improvement of quality of effluent discharge. The action taken such as recycle hot water, avoid oil spill at oil clarification room and improve mill breakdown.

While action taken to ensure boiler smoke emission is within the statutory requirement, the mill has installed boiler fuel auto feeding system and conduct periodic refresher training to boilerman & fireman on the boiler operation & the legal requirements.

Tementi CU also embarks on fuel reduction program whereby the person in-charge of mill and estate workshop needs to ensure that all vehicles are in good running condition i.e no leaking. Vehicle inspection is to be carried out daily and preventive maintenance must be carried out as per schedule. To implement appropriate measures in order to ensure minimum or no mill breakdown so as to minimize operation of stand-by diesel generator set.

There is no peat soil area in Tementi CU. Therefore, Indicator 5.6.3 is not applicable

PRINCIPLE 6: RESPONSIBLE CONSIDERATION OF EMPLOYEES AND OF INDIVIDUALS AND COMMUNITIES BY GROWERS AND MILLERS

Criterion 6.1 Aspects of plantation and mill management, including replanting, that have social impacts are identified in a participatory way, and plans to mitigate the negative impacts and promote the positive ones are made, implemented and monitored, to demonstrate continuous improvement.

Indicators: 6.1.1 A documented social impact assessment including records of meetings. Major compliance

Specific Guidance: Non-restrictive format incorporating elements spelt out in this criterion and raised through stakeholder consultation including local expertise.

6.1.2 Evidence that the assessment has been done with the participation of affected parties. Minor compliance

Specific Guidance: Participation in this context means that affected parties or their official representatives or freely chosen spokespersons are able to express their views during the identification of impacts, reviewing findings and plans for mitigation, and monitoring the success of implemented plans.

6.1.3 A timetable with responsibilities for mitigation and monitoring is reviewed and updated as necessary. Minor compliance

Guidance: Identification of social impacts may be carried out by the grower in consultation with other affected parties, including women and migrant workers as appropriate to the situation. The involvement of independent experts should be sought where this is considered necessary to ensure that all impacts (both positive and negative) are identified.

Particular attention should be paid to the impacts of outgrower schemes (where the plantation includes such a scheme).

Plantation and mill management may have social impacts on factors such as:

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1. Access and use rights. 2. Economic livelihoods (e.g. paid employment) and working conditions. 3. Subsistence activities. 4. Cultural and religious values. 5. Health and education facilities. 6. Other community values, resulting from changes such as improved transport /communication or arrival of substantial migrant labour force.

Findings:

Tementi CU has conducted SIA and these SIA reports included document number 1/2011 dated 7 February 2011 for FELDA Tementi, document number 1/2011 dated 10 February 2011 for Ladang FELDA Bera Selatan 1 and document number 1/2011 dated 9 February 2011 for Ladang FELDA Bera Selatan 4. The reports covered various impacts of activities (subsistence, economic livelihood, and cultural values/religious), facilities (shop, health, education) and other community values (transport and communication, presence of foreign workers) on household members.

List of stakeholders involvement in the SIA were available. The respondents were informed prior to the conduct of the survey as evidenced in „Permohonan membuat survey di Rancangan FELDA Tementi’. For example, in Ladang FELDA Bera Selatan 1, the SIA interviewed 65 respondents comprising 3 contractors (5%), 12 male settlers (18%), 3 female settlers (5%), 2 settler children (3%), 5 traders (8%), 3 field staff (5%), 4 office staff (6%), 10 Indonesian foreign workers (15%), 4 Bangladeshi foreign workers (6%) and 19 others (29%).

A Management Plan addressing/mitigating the issues identified in the social impact assessment had been prepared. Various measures were still on-going and these were time-bound, scheduled-implementation, and were being monitored.

In Stage 1 assessment, the assessment team had highlighted that there was a need to conduct a social impact survey on the impacts (smoke and dust particle) of Tementi POM on the mill workers living in the mill quarters and the nearby residents in Bandar 32, FELDA Tementi, FELDA Sebertak and FELDA Rentam. This was related to the observation made by the Medical Assistant at Kelinik Kesihatan in Bandar 32 that residents living in those areas had cases of cough, asthma and fever especially during the dry period that could be linked to the mill‟s emissions. Staff members at Ladang Tementi had also indicated that participants had also complained of pollution possibly caused by the smoke and dust of Tementi POM.

Before the Stage 2 assessment, the mill management had carried out a quick survey on 7 non- Felda staff respondents from Desa Jelawat Bandar 32 (about 1 km from the mill) which showed that 5 respondents (71%) complained on the smoke and dust pollution caused by the mill operations. The mill manager was aware of the findings even though the complaints were yet to be addressed during the conduct of this stage 2 assessment. The reason was that the sample taken for the special survey was too small. It was proposed that a bigger sample be taken covering more than 1 settlement to provide reliable information for further decision-making.

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Criterion 6.2 There are open and transparent methods for communication and consultation between growers and/or millers, local communities and other affected or interested parties.

Indicators: 6.2.1 Documented consultation and communication procedures. Major compliance 6.2.2 A nominated plantation management official at the operating unit responsible for these issues. Minor compliance 6.2.3 Maintenance of a list of stakeholders, records of all communication and records of actions taken in response to input from stakeholders. Minor compliance

Specific Guidance: Decisions that the growers or mills are planning to make should be made clear, so that local communities and other interested parties understand the purpose of the communication and/or consultation.

Communication and consultation mechanisms should be designed in collaboration with local communities and other affected or interested parties. These should consider the use of existing local mechanisms and languages. Consideration should be given to the existence/ formation of a multi-stakeholder forum.

Communications should take into account differential access to information of women as compared to men, village leaders as compared to day workers, new versus established community groups, and different ethnic groups.

Consideration should be given to involving third parties, such as disinterested community groups, NGOs, or government (or a combination of these), to facilitate smallholder schemes and communities, and others as appropriate, in these communications.

Findings:

There were documents on consultations and communication procedures produced by the Tementi CU, in the form of records of meetings and discussions involving the CU‟s management and community leaders and workers‟ representatives. Consultation was based on Procedure of communication as evidenced in FELDA Palm Industries Sdn Bhd (FPISB), document no.: FPI/L2/QOHSE-6.0 entitled Manual Prosedur, Komunikasi, Penglibatan dan Rundingan (Communication, Participation and Consultation) involving internal and external consultation. The documents on consultations and communication procedures were found to be adequate.

A management official at the operating unit level had been nominated to be responsible on issues related to consultations and communication between growers and/or millers with local communities and affected or interested parties. The Mill Manager and the respective Scheme Manager at their respective estate were the responsible persons.

The lists of stakeholders were found to be comprehensive to include the local Orang Asli communities and the district JAKOA office at Bera. The Tementi CU had identified and maintained a list of stakeholders consisting of, suppliers, community institutions, and local community heads (including the Orang Asli) and workers‟ representatives.

Ladang FELDA Bera Selatan 1 consulted Orang Asli at Kg Lubuk Perah & Kg Lubuk Tambangan via Perjanjian Persefahaman Bersama Orang Asli Sekitar Kawasan Bera Selatan 1 dated 14 Sept 2011. In the case of Ladang FELDA Bera Selatan 4, consultation with Orang Asli at Kg. Guyah resulted in the signing of a similar document entitled Perjanjian Persefahaman Menggunakan Jalan pertanian Ladang Bera Selatan 4. Assessment visits to Orang Asli communities, i.e. Kg Lubuk Perah & Kg Lubuk Tambangan (both outside Ladang FELDA Bera

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Selatan 1) and Kg Guyah and Kg Lenguit (both outside Ladang FELDA Bera Selatan 4) confirmed that consultations were held from time to time to discuss matters such as use of access roads. However, on occasions, such consultations with these communities were not recorded.

Consultations were held with randomly selected workers of the estates (5 Bangladeshi workers and 4 female local workers at Ladang FELDA Bera Selatan 4) and the mill (5 workers at the mills) involved in the assessment as well as contractors and suppliers. In these consultations, issues related to Principle 6 and other related criteria were discussed.

Other forms of Management communication with, to or from staff and settlers, mill staff and interested parties included the following:

 Assembly  Suggestion boxes  Internal circulars/memos  Daily informal communication  Notice board and posters  Through Staff/workers representative  Environmental and social campaigns  Through written complaint form  Management by walk-about

The language of communications had been Malay or English where appropriate.

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

Indicators: 6.3.1 Documentation of the process by which a dispute was resolved and the outcome. Major compliance

Specific Guidance: Records are to be kept for 3 years.

6.3.2 The system resolves disputes in an effective, timely and appropriate manner. Minor compliance 6.3.3 The system is open to any affected parties. Minor compliance

Guidance: Dispute resolution mechanisms should be established through open and consensual agreements with relevant affected parties.

Complaints may be dealt with by mechanisms such as Joint Consultative Committees (JCC) with gender representation. Grievances may be internal (employees) or external.

Findings:

A manual entitled Manual RSPO Kumpulan Felda: Rungutan, Keingkaran, Siasatan Insiden dan Tindakan Pembetulan was available.

There was a documentation on the process by which a dispute would be resolved as well as the outcome, based on (a) manual entitled Manual RSPO Kumpulan Felda: Rungutan, Keingkaran, Siasatan Insiden dan Tindakan Pembetulan, and (b) Procedure of communication is available as evidenced in Felda Palm Industries Sdn Bhd (FPISB) No. document: FPI/L2/QOHSE-6.0

Page 49 of 83 entitlted Manual Prosedur, Komunikasi, Penglibatan dan Rundingan (Communication, Participation and Consultation). There was also a suggestion box placed at the office. The aggrieved parties could either fill in the complaint form or write a letter or submit the complaint verbally to anyone in the main office or to the responsible official on social issues or to the workers‟ representatives or gender representatives. The system was open to everyone, local public as well estate communities. The complaints and their outcomes were recorded and filed. It was observed that grievances and complaints had been resolved in an effective, timely and appropriate manner. This was evident from the records audited and discussion with mill workers union members.

The system was found to be transparent and open to everyone, local public as well estate communities. There was no evidence indicating the system was limited to certain parties (e.g. workers) only. Aggrieved members of the neighboring communities and the any public could make use of this system for submitting any complaint or grievance against the CU and the estates.

Photo 19 : Handphone number of Tementi POM staff for communication

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Photo 20 : Discussion with mill workers during assessment

Photo 21 : Discussion with mill Union representative during assessment

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Criterion 6.4 Any negotiations concerning compensation for loss of legal or customary rights are dealt with through a documented system that enables indigenous peoples, local communities and other stakeholders to express their views through their own representative institutions. Indicators: 6.4.1 Establishment of a procedure for identifying legal and customary rights and a procedure for identifying people entitled to compensation. Major compliance

6.4.2 A procedure for calculating and distributing fair compensation (monetary or otherwise) is established and implemented. This takes into account gender differences in the power to claim rights, ownership and access to land; and long-established communities; differences in ethnic groups‟ proof of legal versus communal ownership of land. Minor compliance

6.4.3 The process and outcome of any compensation claims is documented and made publicly available. Minor compliance

Specific Guidance: This criterion should be considered in conjunction with Criterion 2.3.

Findings:

There was a specific procedure in place for identifying legal and customary rights and for identifying people entitled to compensation. Such procedure is implementation in the form of consultation with Orang Asli leaders and villagers from time to time.

Document on evaluation of land use entitled Penilaian Pengambilan Tanah by Jabatan Penilaian dan Perkhidmatan Harta, Kementerian Kewangan Malaysia, was available and used as a guide for compensation to land use.

Aboriginal peoples Act 1954 and Land Acquisition Act 1960 were available at the Tementi CU. Procedure of compensation was stated in the Land Acquisition Act 1960. However, it was noted that the procedure for the calculation and distribution of fair compensation would not be carried out at the estate/mill level as this would be carried out at the company level.

To-date, there has been no claim for compensation made against the Tementi CU by the Orang Asli in Kampung Orang Asli Lubok Perak, Kampung Orang Asli Lubok Tambangan, Kampung Orang Asli Guyah, and Kampung Orang Asli Lenguit.

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Photo 22 : Assessment discussion in Kg. Orang Asli Lubok Perak

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

Indicators: 6.5.1 Documentation of pay and conditions. Major compliance

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

6.5.3 Growers and millers provide adequate housing, water supplies, medical, educational and welfare amenities in accordance with Workers‟ Minimum Standard of Housing and Amenities Act 1990 (Act 446) or above, where no such public facilities are available or accessible (not applicable to smallholders). Minor compliance

Guidance: Where temporary or migrant workers are employed, a special labour policy should be established. This labour policy would state the non discriminatory practices; no contract substitution of original contract, post arrival orientation program to focus especially on language, safety, labour laws, cultural practices etc; decent living conditions to be provided. Migrant workers are legalised, and a separate employment agreement should be drawn up to meet immigration requirements for foreign workers, and international standards, if ratified.

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Findings:

The agreement (January 2010 till December 2011) between the Tementi CU and the workers‟ unions, namely Perjanjian Bersama Di Antara Felda Palm Industries Sdn Bhd dan Kesatuan Pekerja-pekerja Felda Palm Industries Sdn Bhd (Semenanjung) and Perjanjian Bersama Kali Ke-Empat Di Antara Felda Plantations Sdn Bhd dengan kesatuan Pekerja-pekerja Felda Plantations Sdn Bhd (Semenanjung) was signed between the staff unions and the Company to adopt the pay and conditions for their staff. These agreements cover terms of service, salary, allowances and monetary benefits, medical benefits, confirmation of post, salary scale, transfer, retirement, working hours, overtime, traveling claims, subsidies (housing loan, electricity supply, water supply), leave entitlement, discipline and formation of a committee at HQ and Wilayah level.

The pay conditions were also specified in the letter of appointment and pay slips. Documents showed that Felda Technoplant Sdn Bhd had document titled “Kadar Upah Pekerja Ladang 2011”. Every month, Felda Technoplant Sdn Bhd informed scheme manager on the wage rate for workers. For example it was stated that for June 2011‟s FFB harvesting (in Felda Technoplant Sdn Bhd dated 7 June 2011. Bil (06) 880101030/JOP/3-4, the applicable rates were based several criteria such as Category >25 tonne/hectare, Category 18-24 tonne/hectare and Category 10-17 tonne/hectare. It also includes the FFB price bonus.

As for foreign workers, Felda Plantations Sdn Bhd (FPSB) signed an employment agreements with Indonesian workers as evidenced in document signed dated 24 June 2010. In this agreement, the followings were specified.

Responsibility of workers (a) Place of work in oil palm estate or rubber estate (b) Contract period 3 years; work permit to be renewed annually (c) Daily working 8 hours; working 6 days a week. Can work more than 8 hours a day if agreed. (d) Discipline (cannot work for others; cannot marry within contract period (e) Working equipment (have to take good care of them) (f) All costs (such as levi & pas lawatan kerja sementara) imposed by Immigration Department are to be borne by FPSB. If a worker breaks the 3 years contract or faces disciplinary action, he has to compensate the cost incurred. (g) Workers are entitled to annual leave and public holidays as implemented by the employer in accordance with Akta Kerja 1955. (h) A worker is allowed to return to Indonesia after 2 years of working and continue the work permit in the 3rd year. In this case, the worker is entitled to a transportation allowance of RM250.

Responsibility of Employer

(a) Provision of adequate work (b) Salary or wages and others are to be paid based on productivity. (c) Workers are paid competitive wages. (d) To provide workers‟ quarters adequately based on Malaysian labour laws. (e) Provision of water and electricity supply. If electricity were to be supplied by TNB or water supplied by JBA, a subsidy on cost may be given by the employer. (f) Working equipment are supplied by employer.

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(g) Provide insurance for workers under Skim Pampasan Pekerja Asing (SPPA). Cost is borne by employer. (h) Medical cost for work permit is borne by employer. (i) Employer to bear all cost of treatment in government hospitals. (j) To brief workers on conditions of employment and laws of Malaysia. (k) To terminate contract, if necessary. (l) Cost of traveling to Malaysia to be borne by employer. After contract expires, the employer will provide RM250 as allowance to travel home. (m) Employer to bear cost if during the contract period a worker passes away and is to be buried in Malaysia. (n) Keep passport of workers at scheme office.

Adequate housing, water supplies, medical, educational and welfare amenities in accordance with Workers‟ Minimum Standard of Housing and Amenities Act 1990 (Act 446) had been provided by the Tementi CU. This was confirmed through consultations with workers (local and foreign as well as visits to the mill and estate workers‟ quarters at FELDA Tementi and Ladang FELDA Bera Selatan 4.

Ladang FELDA Bera Selatan 4 also kept a record (document 232400-U of Felda Plantations Sdn Bhd) which listed 208 foreign workers whose insurance expired in 2011-2012. For local workers, they were covered under PERKESO and this was evidenced in the statement of payment for the month of June 2011(Borang 8A PERKESO) for 22 workers in Ladang FELDA Bera Selatan 4.

It was observed at Felda Rentam a new worker quarters has been constructed hence the management of Felda Rentam need to ensure an approval from relevant authority to be obtain before occupaying.(Refer OFI)

Criterion 6.6 The employer respects the right of all personnel to form and join trade unions of their choice and to bargain collectively. Where the right to freedom of association and collective bargaining are restricted under law, the employer facilitates parallel means of independent and free association and bargaining for all such personnel. Indicators: 6.6.1 Documented minutes of meetings with main trade unions or workers representatives. Major compliance 6.6.2 A published statement in local languages recognizing freedom of association. Minor compliance

Guidance: The right of employees and contractors to form associations and bargain collectively with their employer should be respected. Documented company policy recognizing freedom of association.

Labour laws and union agreements or in their absence, direct contracts of employment detailing payments and other conditions are available in the languages understood by the workers or explained carefully to them by a plantation management official in the operating unit.

Findings:

An official published statement entitled Polisi Kebebasan Menganggotai Khidmat Sukarelain Bahasa Melayu as understood by the workers recognizing freedom of association was available and exhibited in public places. The workers whom were consulted had confirmed that they were aware of their right to join the union.

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Notice on the call for meeting on 22 April 2011 with Kesatuan Pekerja-Pekerja Felda Plantations Sdn Bhd was available as evidenced in a letter dated 19 April 2011 issued by Felda Plantations Sdn Bhd. Documented minutes of meetings (in Malay) between the management with workers‟ representatives were also available. Interviews with employees and workers representatives revealed that they had understood the requirement of Criterion 6.6.

(a) The Union (Kesatuan Pekerja-Pekerja Felda Palm Industries Sdn Bhd.) had its Mesyuarat Jawatan Kuasa Kerja Agung Kali Ke-2 on 13 Sept 2011 in Kuala Terennganu. Its branch Cawangan Kilangan Sawit Felda Tementi had ist annual general meeting on 2 May 2010. It has a committee of nine members as shown in Borang L and 67 members in Borang U Akta kesatuan Sekerja 1959 dated 2 May 2010.

Committee meeting minutes dated 13 August 2011 for the Tementi POM branch of Kesatuan Pekerja-pekerja Felda Palm Industries Sdn Bhd. In this meeting, various issues (such as sports, health & safety, welfare, religious practice, discipline and career, discussion with mill management) related to members were discussed.

(b) The Union (Kesatuan Pekerja-Pekerja Felda Plantations Sdn Bhd) had meeting with head of Zon Timur on 22 April 2011. Among the matters discussed in this meeting included overtime claim, motivation course, sports and recreation, sickness and death, and housing.

Felda Palm Industries Sdn Bhd signed an agreement with Kesatuan Pekerja-Pekerja Felda Palm Industries Sdn Bhd (Semenanjung) and rights, priviledges and disciplines of members effective 1 January 2010 to 31 December 2012.

Felda staff members are encouraged to become members of Kesatuan Pekerja-pekerja Felda. Of the 85 employees at Tementi POM, 72 (85%) are members to Kesatuan Pekerja-Pekerja Felda Palm Industries Sdn Bhd (Semenanjung).

Employment of workers is according to Malaysian laws, including benefits such as insurance for workers (local and foreign) and social security (Perkeso) for local workers.

Criterion 6.7 Children are not employed or exploited. Work by children is acceptable on family farms, under adult supervision, and when not interfering with education programmes. Children are not exposed to hazardous working conditions. Indicator: 6.7.1 Documented evidence that minimum age requirement is met. Major compliance Guidance: Growers and millers should clearly define the minimum working age, together with working hours. Only workers 16 years and older may be employed, with the stated exception of family farms. Smallholders should allow work by children only if permitted by national regulations.

The minimum age of workers should be not less than 16 years, or the minimum school leaving age, or the minimum age permitted under national regulations, where higher.

Findings:

The statement Policy on no employment of children below 17 years old is available and were placed in public places.

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There was clear evidence that the minimum age requirement had been met. There was no record of persons under the age of eighteen, the minimum working age under Malaysian Labor Laws (Am. Act A1238) hired by the CU. This was evidenced in the list of workers insured under Perkeso (statement of contribution for June 2011) where the identity card number of 22 local workers showed that the youngest worker was born in 1992, who was 19 years old in 2011. This was also confirmed by the workers interviewed and verified through employment card and copies of passports.

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: 6.8.1 A publicly available equal opportunities policy. Major compliance 6.8.2 Evidence that employees and groups including migrant workers have not been discriminated against. Minor compliance

Guidance: The grievance procedures detailed in 6.3 apply. Positive discrimination to provide employment and benefits to specific communities is acceptable as part of negotiated agreements.

Findings:

An equal opportunities policy entitled Polisi kesetaraan peluang was publicly made available in the Malay language understood by the workers.

Job openings were made available to any qualified person regardless of his/her socio-cultural, political or gender background.

All workers (local or migrant, male or female) were covered by the same payments and conditions of employment associated with the jobs they are hired for. This was confirmed by consultations with workers.

Assessment interview with 5 Bangladeshi workers confirmed that there was no discrimination. Each workers received an average monthly income of about RM1,300. They were satisfied with the job opportunities and good quarters conditions as provided by the employer.

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Photo 23 : Interview with Bangladeshi workers at Ladang FELDA Bera Selatan 4 Criterion 6.9 A policy to prevent sexual harassment and all other forms of violence against women and to protect their reproductive rights is developed and applied.

Indicator: 6.9.1 A policy on sexual harassment and violence and records of implementation. Major compliance 6.9.2 A specific grievance mechanism is established. Major compliance Guidance: There should be a clear policy developed in consultation with employees, contractors and other relevant stakeholders, which should be publicly available. The policy is applicable within the boundaries of the plantation/mills or while on duty outside the premises. Progress in implementing the policy should be regularly monitored and the results of monitoring activities should be recorded.

A committee specifically to address concerns of women may be required to comply with the criterion. This committee will consider matters such as; training on women‟s rights, counselling for women affected by violence and child care facilities to be provided by the growers and millers. The activities of the committee should be documented.

Findings:

There was a published policy on sexual harassment and violence in the Malay language made available to employees.

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Photo 24 : Policy on sexual harassment at Ladang FELDA Bera Selatan 4 admin office

There was a specific grievance mechanism to handle on issues related to sexual harassment and violence. A gender committee or Jawatankuasa Hal Bergerak Wanita whose responsibilities among others are to look into gender issues (especially matters related to sexual harassment) had been established in each estate/mill being assessed. This was also confirmed by information gathered during consultations held with the female employees as well as members of the gender committee.

Assessment interview with 5 female workers at Ladang FELDA Bera Selatan 4 and a committee member of Persatuan Wanita Ladang FELDA Bera Selatan 4 confirmed that there was no case of sexual harassment and violence which had occurred.

Photo 25 : Interview with a committee member of Persatuan Wanita Bera 4

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

Indicators: 6.10.1 Pricing mechanisms for FFB and inputs/services shall be documented. Major compliance 6.10.2 Current and past prices paid for FFB shall be publicly available. Minor compliance 6.10.3 Evidence that all parties understand the contractual agreements they enter into, and that contracts are fair, legal and transparent. Minor compliance 6.10.4 Agreed payments shall be made in a timely manner.

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Minor compliance

Guidance: Transactions with smallholders should consider issues such as the role of middlemen, transport and storage of FFB, quality and grading.

Smallholders must have access to the grievance procedure under Criterion 6.3, if they consider that they are not receiving a fair price for FFB, whether or not middlemen are involved.

The need for a fair and transparent pricing mechanism is particularly important for outgrowers, who are contractually obliged to sell all FFB to a particular mill. If mills require smallholders to change practices to meet the RSPO criteria, consideration must be given to the costs of such changes, and the possibility of advance payments for FFB could be considered.

Findings:

The pricing mechanism on the purchase of FFB was found to be conducted in a fair and transparent manner with smallholders as evidenced from

(a) The statement on how FFB price was calculated and its announcement was evident during roll call.

(b) The issuance of monthly details on net weight and price per tonne for smallholders by Felda Palm Industries Sdn Bhd.

(c) Written acknowledgement on the receiving of FFB of each smallholder.

Daily current and past prices paid for FFB were displayed on the notice boards of schemes. Past FFB prices were publicly available at the mill (entrance gate).

Assessment interview revealed that smallholders were happy on their FFB trading with the mill. The prices offered by the CU had followed the MPOB‟s guidelines.

The smallholders interviewed at Ladang FELDA Bera Selatan 4 also confirmed that payments were promptly made.

Polisi Perhubungan Perusahawan and contracts with business community were available and placed in public places. An example was the rental of shop lot by Ladang FELDA Bera Selatan 4 to D‟ Mart Bera Selatan 4 in contract dated 11 July 2011. In this contract agreement, the monthly rental was RM200, regarded fair to both parties. This was confirmed during assessment visit to D‟ Mart in Bera Selatan 4.

Criterion 6.11 Growers and millers contribute to local sustainable development wherever appropriate.

Indicator: 6.11.1 Demonstrable contributions to local development that are based on the results of consultation with local communities. Minor compliance

Guidance: Contributions to local development should be based on the results of consultation with local communities. See also Criterion 6.2. Such consultation should be based on the principles of transparency, openness and participation and should encourage communities to identify their own priorities and needs, including the different needs of men and

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Where candidates for employment are of equal merit, preference should always be given to members of local communities in accordance to national policy. Positive discrimination should not be recognized as conflicting with Criterion 6.8. Findings:

It was noted that the Tementi CU had initiated consultations with the local communities as well as neighboring external communities. This was evident from the records kept on social impact assessments. Information obtained was used to work out a social management plan, which help to contribute to local social development. In 2011, Tementi POM had given out financial contribution to Kelab Keluarga Dayabudi and food/material contribution to Surau Kilang Sawit Tementi and staff members.

The Felda schemes had also assisted the surrounding Orang Asli villages in providing road access. The plantation road had provided the villagers access to the main public road, especially in transporting their oil palm fruits for sale. The use of the road also facilitates Orang Asli to purchase things both within and outside the schemes to meet their daily subsistence needs.

PRINCIPLE 7: RESPONSIBLE DEVELOPMENT OF NEW PLANTING

The assessment team has verified no new planting at Tementi CU therefore Principle 7 is not applicable.

PRINCIPLE 8: COMMITMENT TO CONTINOUS 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 continuous improvement in key operations. MY NIWG commits to demonstrate progressive improvement to the following but not limited to: 8.1.1 Minimise use of certain pesticides (C4.6) Major compliance 8.1.2 Environmental impacts (C5.1) Major compliance 8.1.3 Maximizing recycling and minimizing waste or by-products generation. Major compliance

Specific Guidance: To work towards zero-waste (C5.3)

8.1.4 Pollution prevention plans (C5.6) Major compliance 8.1.5 Social impacts (C6.1) Major compliance 8.1.6 A mechanism to capture the performance and expenditure in social and environmental aspects.

Minor compliance

Guidance: Specific minimum performance thresholds for key indicators should be established. (See also C 4.2, 4.3, 4.4, and 4.5).

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Growers should have a system to improve practices in line with new information and techniques and a mechanism for disseminating this information throughout the workforce.

For smallholders, there should be systematic guidance and training for continuous improvement. Findings:

Tementi CU had established a system to regularly monitor and review their key activities at the mill and estates, and initiated action plans for continuous improvement in its key areas of operations.

Evidence which had been sighted on action taken to allow for continuous improvement included the commitment to minimize the use of certain pesticides by implementing IPM. SIA had been carried out with participation of the affected communities. A Management Plan addressing/mitigating the issues identified in the social impact assessment had been prepared. Various measures still on-going and these were time-bound, scheduled-implementation, and been monitored. Based on interview with stakeholders, it was confirmed that Tementi CU is committed to ensure the negative impacts are rectified.

A mechanism to capture the performance and expenditure on environmental and social aspects had been well established. In January 2011, Tementi POM has installed one new unit of steam boiler complete with i.e multi dust cyclone for air pollution control facilities, CEMS (Continuous Emission Monitoring System) and automation fuel feeding system.

4.0 Assessment Recommendation

Based on the evidence gathered, the assessment team has raised one minor non conformity on the Tementi CU against the requirements of the RSPO MYNI. The Tementi CU had taken the appropriate corrective actions to address the nonconformity. The corrective actions taken by the CU will be verified by the assessment team during the surveillance assessment. The assessment team therefore recommends the Tementi Certification Unit for certification against the RSPO MYNI.

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5.0 Organization’s Acknowledgement of Internal Responsibility and Formal Sign-off of Assessment Findings

I, the undersigned, representing Tementi Certification Unit, acknowledge and confirm the content of the assessment report and findings of assessment.

Name:

Signature:

Designation:

Date:

I, the undersigned, representing SIRIM QAS International Sdn. Bhd., acknowledge and confirm the content of the assessment report and findings of assessment.

Name : Ruzita Abd Gani

Signature:

Designation: Assessment Team Leader

Date : 18 May 2012

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Attachment 1a

FELDA TEMENTI COMPLEX

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Attachment 1b

Location map of Felda Tementi

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Attachment 1c

Location map of Felda Rentam

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Attachment 1d

Location map of Felda Sebertak

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Attachment 1e

Location map of Ladang Felda Bera Selatan 1

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Attachment 1f

Location map of Ladang Felda Bera Selatan 4

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Attachment 2 SIRIM QAS INTERNATIONAL SDN. BHD. Food, Agriculture & Forestry Certification Section

RSPO MAIN ASSESSMENT PLAN

1. Objectives

The objectives of the assessment are as follows: (i) To determine Felda Palm Industries Sdn. Bhd , Tementi Complex conformance against the RSPO Principles & Criteria Malaysian National Interpretation (MYNI). (ii) To make appropriate recommendations based on the assessment findings.

2. Date of assessment : 19 – 21 December 2011

3. Site of assessment : Felda Palm Industries Sdn. Bhd. Tementi Tementi Palm Oil Mill, 28300 Triang, Pahang. FELDA Tementi, 28300 Triang, Pahang. FELDA Rentam, 28300 Triang, Pahang. FELDA Sebertak, 28300 Triang, Pahang. Ladang FELDA Bera Selatan 1, 28300 Triang, Pahang. Ladang FELDA Bera Selatan 4, 28300 Triang, Pahang..

4. Reference Standard

a. RSPO P&C MYNI b. Company‟s audit criteria including Company‟s Manual/Procedures

5. Assessment Team

a. Lead Assessor : Pn. Ruzita Abd Gani b. Assessor : Mr. Khairul Najwan Ahmad Jahari : Dr. Lim Hin Fui : Mr. Yap Nyoke Yong, Raymond

If there is any objection to the proposed audit team, the organization is required to inform the Lead Auditor/RSPO Section Manager.

6. Audit Method

Site audits including observation of practices, interviews with interested parties (employees, nearby population, etc.), documentation evaluation and evaluation of records.

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7. Confidentiality Requirements

SIRIM QAS International shall not disclose any information concerning the company regarding all matters arising or coming to its attention with the conduct of the programme, which is of confidential in nature other than information, which is in the public domain.

In the event that there be any legal requirements for disclosing any information concerning the organization, SIRIM QAS International shall inform the organization of the information to be disclosed.

8. Working Language : English and Bahasa Malaysia

9. Reporting

a) Language : English b) Format : Verbal and written c) Expected date of issue : Sixty days after the date of assessment d) Distribution list : client file

10. Facilities Required

a. Room for discussion b. Relevant document and record c. Personnel protective equipment if required d. Photocopy facilities e. A guide for each group

11. Audit Program Details : as below

DAY ONE: 19 December 2011 - Monday Time Activities and areas to be visited Auditee Opening Meeting, Audit team introduction and briefing on audit objectives, scope, Tementi 12.00 pm methodology, criteria and programmes by audit team leader. complex Briefing on the Tementi Complex background and implementation of RSPO representati (including action taken to address pre assessment findings) . ve Please provide a copy of Tementi complex map which indicate mill & its 12.15 pm supply bases and surrounding neighbor e.g. other plantations, wetland,forest, kampong & etc

12.45 pm Break & Solat Zohor Ruzita Khairul Najwan

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Assessment at FELDA Tementi Assessment at Ladang FELDA Bera 2.00 pm  Facilities such as fertilizer & Selatan 4 Guide/PIC pesticide stores  Conservation area  Workshop  Riparian zone  Waste disposal area  River system  Verify previous audit findings  Boundary stones  Water catchment area (if any) P1, P2, P3, P4 (4.1, 4.2, 4.3, 4.4, 4.5,  Interview with relevant government 4.6,), 5 (5.3, 5.5), P8 agencies (if applicable)

P1, P2, P4 (C4.1, C 4.3, C4.4),P5 (C5.1, C5.2, C5.3,C 5.5), P8 5.30 pm Audit Team Discussion & End of Day 1

Day 2: 20 December 2011 - Tuesday Time Activities and areas to be visited Auditee Ruzita Raymond Khairul Najwan Dr. Lim Hin Fui 08.30 Assessment at Assessment at Assessment at Assessment at am FELDA Rentam FELDA Rentam ELDA Sebertak kilang Sawit Tementi &  Facilities such  Good  Conservation FELDATementi as fertilizer & Agricultural area pesticide stores Practice  Riparian zone  Visit and  Workshop  Nursery (if any)  River system discussion with  Waste disposal  EFB mulching  Boundary stones relevant area  Boundary stones  Water management  Verify previous  Legal ownership catchment area (CSR, community audit findings of land (if any) affairs),  Interview with  Interview with surrounding local P1, P2, P3, P4 relevant contractor & community) (4.1, 4.2, 4.3, 4.4, stakeholder e.g. relevant  Viewing 4.5, 4.6,), 5 (5.3, estate contractor government documentation 5.5), P8 agencies (if relating to local P2 (C2.2, C2.3), applicable) community and P3, P4 (C4.1,C4.2,  Facilities such as indigenous C4.3, C4.4, C4.5, fertilizer & peoples issues C4.6, 4.8), P5 pesticide stores such as EIA, SIA

(C5.5, C5.6), P6  Workshop and management

(C6.10), P8  Waste disposal plans

area  Interviews with union  Verify previous audit findings representative  Verify previous

P2, P3, P4 (C4.1, audit findings  Interview with C4.3, C4.4, C48),P5 (C5.1, union representative C5.2, C5.3,C 5.5,C5.6), P8  Consultation with

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related government agencies (if applicable)

P1, P2, P3, P6, P8

1.00 Break & Solat Zohor pm Continue Continue Continue Continue 2.00 Assessment Assessment Assessment Assessment Guide /PIC pm  Verify previous  Verify previous  Verify previous  Verify previous audit findings audit findings audit findings audit findings

05.30 Audit Team Discussion & End of Day 2 pm

Day 3: 21 December 2011 -Wednesday Time Activities and areas to be visited Auditee Ruzita Raymond Khairul Najwan Dr. Lim Hin Fui 08.30 Assessment at Kilang Assessment at Assessment at Assessment at am Sawit Tementi Ladang FELDA Rentam Ladang FELDA FELDA Bera Bera 4  Verification on plan Selatan 1  Conservation for other area  Visit and management unit &  Good  Riparian zone discussion with smallholder Agricultural  River system relevant certification Practice  Boundary management  Production area  Nursery (if stones (CSR, (incoming to storage) any)  Water community  ETP  EFB mulching catchment area affairs),  Utilities e.g. boiler,  Boundary (if any) surrounding WTP etc. stones  Interview with local  Workshop  Legal contractor & community)  Scheduled waste ownership of relevant  Viewing store land government documentation  Chemical store  Interview with agencies (if relating to local  Interview with relevant applicable) community and contractor stakeholder  Facilities such indigenous e.g. estate as fertilizer & peoples issues P1, P2, P3, P4, P5, P8 contractor pesticide stores such as EIA,  Workshop SIA and  Waste disposal management P2 (C2.2, area plans C2.3), P3, P4  Verify previous  Interviews with (C4.1,C4.2, audit findings union C4.3, C4.4, representative C4.5, C4.6, P2, P3, P4 (C4.1,  Verify previous 4.8), P5 (C5.5, C4.3, C4.4, audit findings C5.6), P6 C48),P5 (C5.1,  Interview with

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(C6.10), P8 C5.2, C5.3,C union 5.5,C5.6), P8 representative  Consultation with related government agencies (if applicable)

P1, P2, P3, P6, P8

01.00 Break & Solat Zohor pm 02.00 Audit Team Discussion & preparation on the assessment findings pm 04.30 Discussion on the audit findings and Closing meeting All pm

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Attachment 3 LIST AND COMMENTS FROM STAKEHOLDER

List of Stakeholders Comment highlighted Verification A : Government Agencies/Service Provider Department of No issue Verification of Tementi CU operation no Environment (DOE), complaint raised by DOE. Kuantan Department of No issue Assessment on the records confirmed Occupational Safety and no summon issue by DOSH Health (DOSH), Kuantan Jabatan Kemajuan Orang No issue None Asli (JAKOA) – District of Bera, Pahang, Forestry Department – Forestry Department has no Verification of Tementi CU operation Branch of Temerloh issue with Tementi CU. showed that they are committed to ensuring relevant forestry laws are complied with.

Department of Irrigation No issue Assessment has verified that Tementi and Drainage (DID) – CU is committed in ensuring that Branch of Kuantan relevant requirements of DID are complied with. Malaysian Palm Oil Board No issues None (MPOB) Labour Department – No issue None Branch of Kuantan Fire Fighting and Rescue No issues None Department – Branch of Bera Employee Providence No issues None Fund (EPF) Social Security No issues None Organizations (PERKESO) Immigration Department, No issues None Kuantan Department of Wildlife and No issues None Natural Park (PERHILITAN) Police - Branch of Chini, No issues None Rentam District Health Office, Interview with Medical Assistant Assessment team has verified the

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Pekan, and Bandar 32, at Klinik Kesihatan in Bandar 32 smoke emission data and found Pahang that residents living in these emission reading complied with areas have cases of cough, regulations. Tementi POM also has asthma and fever especially installed new boiler as a commitment for during the dry days that might pollution control. Assessment on be linked to the mill‟s communication record with DOE emissions. revealed no complaint received from DOE. Department of Agriculture, No issue None Kuantan Fisheries Office, Kuantan No issue None

Public Works Department, No issue None Bera

TNB Distribution Sdn.Bhd., No issue None Bandar Bera

Jabatan Agama Islam, No issue None Bera

Department of Aboriginal No issue None Affairs, Bandar Bera, Pahang

B : Non-Governmental Organizations World Wildlife Fund No issue None (WWF), Petaling Jaya Malaysian Nature Society No issue None (MNS), Kuala Lumpur Sahabat Alam Malaysia. No issue None Wetlands International No issue None Tenaganita No issue None National Union of No issue None Plantation Workers (NUPW), All Malaysian Estates Staff No isue None Union (AMESU), C : Local Communities Kampung Orang Asli No issue None Lubok Perak, Bera

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Kampung Orang Asli No issue None Lubok Tambangan, Bera Kampung Orang Asli No issue None Guyah, Bera Kampung Orang Asli No issue None Lenguit, Bera D : Other interested parties D‟Mart shop manger (Felda No issue None Trading Sdn Bhd), Ladang FELDA Bera Selatan 4 Tabika Kemas, Ladang No issue None FELDA Bera Selatan 4 AMESU members No issue None NUPW members No issue None Chemical Handler No issue None Persatuan Wanita Bera No issue Assessment team has confirmed no Selatan 4 case of sexual harassment and violence Provision shop operator No issue None Chemical supplier No issue None FFB transporter No issue None Parts supplier No issue None

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Attachment 4

DETAIL OF NON-CONFORMITY AND CORRECTIVE ACTIONS TAKEN

P & C Specification Detail Non- Corrective Action Verification by Indicator Major/Minor conformances Taken Assessor

Criterion Minor Tementi POM has Tementi POM to Photograph shows 5.1 established the ensure minimal stock minimal stock of Indicator environmental of EFB and boiler ash EFB & boiler ash at 5.1.2 management plan to at dumping area. dumping area. mitigate the negative - Regular meeting impacts from its with surrounding Records of EFB activities however it estates to ensure disposal to estate was observed the EFB is taken by as well as burned in free flow of waste estates for the incinerator were water from EFB & mulching verified boiler ash dumping - Communicate with area into monsoon Regional Office to Monsoon drain no.1 drain no. 1 was left sell the EFB as daily monitoring unattended and by- product. records shows no unchecked. - Close monitoring traces of waste of monsoon drains water discharge. no 1 discharge. The effectiveness of the action taken will be verified in the next assessment.

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Attachment 5a

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Attachment 5b

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Attachment 5c

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Attachment 6

OPPORTUNITIES FOR IMPROVEMENT

Indicator Details Comments 4.1.1 Waste management The SOP on the management of domestic waste needs to be improved to include specific criteria to select the disposal site

4.3.2 Soil erosion risk Generally, there was emphasis of cover crop planting. Although the cover crop planted is satisfactory, it is expected to give adequate ground coverage within 4 months. Hence, at the time of audit , it was not posible to verify an adequate cover crop planting functioning to minimise soil erosion (Refer OFI).

Frond staking is sub-optimal and needs improvement.

Number of conservation pits constructed can be enhanced

4.5.2 Integrated pest management Although beneficial plants are sighted in the fields, they are insufficient and hence more intensive planting is required.

4.7.1 Occupational health and safety plan It was observed that at Felda Plantation Bera Selatan 4, the contractor‟s workers constructing the chemical store did not wear PPE

5.1.2 Environmental improvement plan It was observed that the bio-polishing plant the chemical containers was not properly managed.

5.2.2 Management plan for HCV habitats (including ERTs) and their conservation The management plan for HCV habitats and their conservation is available. However, the monitoring form needs to be improved and communicated effectively to the managers.

6.1.1 A documented social assessment including records of meetings Social impact assessments have been documented. However, there is a need to assess the impacts of smoke and dust caused by mill operations on the nearby residents.

6.5.3 Adequate housing At Felda Rentam, the new worker quarters needs to obtain approval from the relevant authority before occupying.

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