RSPO PRINCIPLES & CRITERIA CERTIFICATION REPORT Public … · 2014. 11. 2. · During the audit,...

SGS RSPO

(Principles & Criteria)

Doc. Number: GP 7003A

Doc. Version date: 01 April 2013

Page: 1 of 57

SGS RSPO, SGS (Malaysia) Sdn. Bhd., No. 26, Jalan Anggerik Vanilla, 31/93, Kota Kemuning, 40460 Shah Alam, Malaysia CONTACT PERSON: ABDUL HAYE SEMAIL Tel: +6 (03)5121 2320 - Fax: +6 (03)5122 5927

WWW.SGS.COM

RSPO PRINCIPLES & CRITERIA CERTIFICATION REPORT

Public Summary Information

Project Number: MY 02023 Certificate No.: SGS-RSPO/PM-00722

Validity Period: 11/04/2011 – 10/04/2016

Report Ref. No.: RSPO Membership No.:

1-0008-04-000-00

Client Name: SOU 24, Ulu Remis Sime Darby Plantation Sdn Bhd

Website: www.simedarbyplantation.com

Scope: Receiving and processing of RSPO certified Fresh Fruit Bunches (FFB) from its supply base, production and sales of RSPO certified Crude Palm Oil (CPO) and Palm Kernel (PK) under Module D (CPO Mill: Segregation) of RSPO Supply Chain and RSPO MY-NI standard.

Type of Certificate Holder:

INDIVIDUAL

Number of Mill: 1 Number of Sites: 1

Mill Capacity: 60MT/hour Annual CPO Produced (MT):

49,612MT

Address:

Street and number:

Town/City

State/Country

Zip/Postal code

Country

Head Office

Sime Darby Plantation Sdn Bhd

Main Tower, Level 3, Plantation Tower,

No. 2, PJU 1A/7, Ara Damansara,

47301 Petaling Jaya, Selangor

Tel: 03 7848 4000 Fax: 03 7848 4172

Mill Address

Kilang Kelapa Sawit (KKS) Ulu Remis,

P.O. Box 107, 81850 Layang-Layang, Johor

Tel: +607 752 7126

Fax: +607 752 7323

Email: [email protected]

Contact Person:

Name: Mr. Muhammad Ali Nuruddin

Position: Vice President II

Contact: +603 7848 4000


Contact Person (Mill Manager):

Name: Mr. Mohd Shafril Baharudin

Position: Mill Manager (Ulu Remis)

Contact : +6013 584 5492


Country: Malaysia

Plantation Unit Being Evaluated:

Supply Base Name & Address

1. Ulu Remis Estate, Layang-Layang, Johor

2. Bukit Badak, Layang-Layang, Johor

3. Tun Dr Ismail Estate, Renggam, Johor

4. Pekan Ropel, Kulai, Johor

5. Sembrong, Layang-Layang, Johor

6. Cenas, Kulai, Johor

Total Certified Area (Ha):

16,762.66 Ha

Total FFB Produced (MT):

271,393.6 MT

Evaluation Date:

Main Assessment 12th

– 16th January 2009

ASA 01 8th

– 10th

May 2012

ASA 02 26th

– 28th March 2013

ASA 03

ASA 04

End of Public Summary

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TABLE OF CONTENTS

1. SUMMARY ................................................................................................................................................. 3

List of Abbreviation ................................................................................................................................................ 4

2. scope of certification assessment ......................................................................................................... 5

2.1 National Interpretation Used ..................................................................................................................... 5

2.2 Certification Scope ................................................................................................................................... 5

2.3 Location and Maps ................................................................................................................................... 5

2.4 Description of Supply Base and Mill Processing Capacity........................................................................ 9

2.5 Date of Planting and Cycle ....................................................................................................................... 9

2.6 Other Certification Held .......................................................................................................................... 10

2.7 Organizational Information and Contact Person ..................................................................................... 10

2.8 Time-bound Plan for Other Management Units ...................................................................................... 10

2.9 Area of Plantation ................................................................................................................................... 11

2.10 Date Certificate Issued and Scope of Certificate .................................................................................... 11

3. Assessment Process ............................................................................................................................. 11

3.1 Certification Body ................................................................................................................................... 11

3.2 Assessment Methodology, Programme, Site Visits ................................................................................ 12

3.3 Qualification of Lead Assessor and Assessment Team.......................................................................... 13

3.4 Stakeholder Consultation and List of Stakeholders Contacted ............................................................... 13

4. Assessment Findings ............................................................................................................................ 14

4.1 Summary of Findings.............................................................................................................................. 14

4.2 Corrective Action Request ...................................................................................................................... 42

4.3 Noteworthy Positive & Negative Observation ......................................................................................... 42

4.4 Status of Non-Conformities Previously Identified ................................................................................... 42

4.5 Issues Raised by Stakeholders and Findings ......................................................................................... 42

5. Acknowledgement of Organization Internal Responsibility .............................................................. 43

5.1 Date of Next Surveillance Visit ............................................................................................................... 43

5.2 Date of Closing Non-Conformities .......................................................................................................... 43

5.3 Acknowledgement of Internal Responsibility and Formal Sign-off Assessment Findings ....................... 43

APPENDIX A: CORRECTIVE ACTION REQUEST & OBSERVATIONS ............................................................. 44

APPENDIX B: NON-CONFORMITIES PREVIOUSLY IDENTIFIED ..................................................................... 49

APPENDIX C: TIMEBOUND PLAN ....................................................................................................................... 55

APPENDIX D: LIST OF STAKEHOLDERS CONTACTED ................................................................................... 57

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1. SUMMARY

The recent merger of Sime Darby Berhad, Golden Hope Plantations Berhad and Kumpulan Guthrie

Berhad which was completed on November 27, 2007, establishes Sime Darby Plantation Sdn Bhd.

Sime Darby Plantation Sdn Bhd represents one of the five core Divisions of Sime Darby Group and is

involved in the following:-

Oil palm cultivation

Agribusiness & Food

Research & Development

The Plantation Division spans across Peninsular Malaysia, Sabah and Sarawak in Malaysia

and Kalimantan, Sumatera and Sulawesi in Indonesia representing a total of 524,626 hectares of

planted oil palm. The operations involve the management of 208 estates and 65 mills.

The Division’s downstream operations are represented in 15 countries namely: Malaysia,

Singapore, Thailand, Vietnam, Japan, China, Germany, United Kingdom, Bangladesh, South Africa,

United Arab Emirates, The Netherlands, Brazil, Canada and the United States of America.

Alongside oil palm, plantation division is also involved in agri-business activities and cultivation

of rubber. As an integrated oil palm company, Sime Darby Plantation’s business activities cover the

whole spectrum of the value chain. Committed to sustainable development, the Company’s Upstream

and Downstream activities adhere strictly to industry-proven Best Agricultural Practices.

In keeping with the aspiration of making a sustainable future real for everyone, Sime Darby

Plantation Sdn Bhd claims to makes a conscious and concerted effort towards conservation and

protection of the environment, the rehabilitation of forests, protection of wildlife and promotion of the

well-being of the communities in which it operates.

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LIST OF ABBREVIATION

Short Form Meanings

CAR Corrective Action Request

CHRA Chemical Health Risk Assessment

CPO Crude Palm Oil

DID Department of Drainage and Irrigation, Malaysia

DOE Department of Environment, Malaysia

EFB Empty Fruit Bunch

EIA Environment Impact Assessment

EMS Environmental Management System

EQA Environmental Quality Act

ERT Endangered, Rare and Threatened species

ESA Environmentally Sensitive Area

FFA Free Fatty Acids

FFB Fresh Fruit Bunches

FR Forest Reserve

Ha Hectare

HCV High Conservation Value

HDPE High Density Polyethylene

IPM Integrated Pest Management

ISO International Organisation for Standardisation

IUCN International Union for Conservation of Nature and Natural Resources

JCC Joint Consultative Committee

JUPEM Jabatan Ukur dan Pemetaan Malaysia (Department of Survey and Mapping Malaysia)

K Potassium

kW Kilowatt

M Meter

Mg Magnesium

Mm Millimeter

Mt Metric ton

MYNI Malaysia National Interpretation

N Nitrogen

NGO Non Governmental Organisation

OA Orang Asli (Indigenous People)

OER Oil Extraction Rate

OSH Occupational Safety & Health

P Phosphate

P & C Principles and Criteria

PK Palm Kernel

POME Palm Oil Mill Effluent

PPE Personal Protective Equipment

SOP Standard Operating Procedures

Sdn Bhd Sendirian Berhad (Private Limited)

SEIA Social and Environment Impact Assessment

Sg Sungai

SGS Societe Generale de Surveillance

SOP Standard Operating Procedures

yr Year

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2. SCOPE OF CERTIFICATION ASSESSMENT

2.1 National Interpretation Used

The operations of the mill and their supply base of FFB were assessed against the Roundtable

on Sustainable Palm Oil (RSPO), Principles and Criteria (P&C) – Malaysia National

Interpretation Working Group (MY-NIWG) Standard, November 2010 and RSPO Supply

Chain Certification Standard, November 2011.

2.2 Certification Scope

The scope of this certification includes the operation of Ulu Remis Palm Oil Mill and its supply

base as “Receiving and processing of RSPO certified Fresh Fruit Bunches (FFB) from its

supply base, production and sales of RSPO certified Crude Palm Oil (CPO) and Palm

Kernel (PK) under Module D (CPO Mill: Segregation) of RSPO Supply Chain and RSPO

MY-NI Standard”.

2.3 Location and Maps

Ulu Remis Palm Oil Mill is operating and located in Layang-Layang, Johor, Malaysia

(Figure 1). The mill is grouped under one strategic operating unit, SOU 23 with six (6)

supplying estates which is directly managed by Sime Darby Plantation Sdn. Bhd. More

detailed information on the estates location and layouts is shown in Figures 2, 3 and 4. The

GPS locations of the mills are shown in Table 1.

Table 1: Mill and Supply Base GPS Location

Mill/Supply Base Longitude Latitude

Ulu Remis Palm Oil Mill 103° 27’ 45.000” E 10° 50’ 4.000” N

Tun Dr Ismail Estate 103° 24’ 7.416” E 10° 53’ 2.724” N

Ulu Remis Estate 103° 27’ 45.00” E 01° 50’ 4.000” N

Pekan Ropel Estate 103° 34’ 59.40” E 1° 51’ 18.670” N

Sembrong Estate 103° 46’ 17.00” E 10° 87’ 4.000” N

Bukit Badak Estate 103° 28’ 47.2794” 10° 48’ 51.624” N

Cenas Estate 103° 61’ 67.00” E 10° 86’ 7.000” N

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Figure 1: Location Map for Strategic Operating Unit (SOU) 23, Ulu Remis, Johor

Figure 2: Estates and Mills Location Map

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Figure 3: Bukit Badak Estate Layout

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Figure 4: Pekan Estate Layout

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2.4 Description of Supply Base and Mill Processing Capacity

The FFB is sourced from six (6) estates which are directly managed by Sime Darby

Plantation Sdn. Bhd under Strategic Operating Unit (SOU) 23. The actual crop figures from

each estate in the financial year 2011/2012 are listed in Table 2 below.

Table 2: Budgeted Yield from Supply Base (FY2011/2012)

Name of estate

Plantation area Annual FFB Production (MT)

Production

(ha) Conservation

(ha)

Tun Dr Ismail Estate 4,091.18 - 53,586.49

Ulu Remis Estate 1,770.00 2,025.00 38,052.414

Pekan Ropel Estate 3,121.47 3,121.47 70,180.04

Sembrong Estate 1,288.61 1,778.78 29,238.60

Bukit Badak Estate 2,526.00 - 48,621.64

Cenas Estate 1,804.55 38.86 31,714.43

Total 14,601.81 6,964.11 271,393.60

Table 3 below shows the mill production figures for FY2011/2012. The mill is receiving FFB from SOU 23 and SOU 24 which is directly managed by Sime Darby Plantation Sdn Bhd which are also certified under RSPO scheme. Receiving of FFB from out growers (Choon Guan Oil Palm) has been discontinued since April 2012.

Table 3: Mill Processing Data (FY2011/2012)

Financial Year

(FY11/12)

Mill Production Figures (MT) (Audited Estate)

FFBs Received FFBs Processed CPOs Produced PKs Produced

SOU 23 226,484.00 227,262.78 48,700.37 11,316.50

Other SOU (SOU 24) 4,254.41 4,254.41 911.72 211.87

Outside Crop

(Uncertified) 27.98 27.98 6.00 1.39

Total 230,766.39 231,545.17 49,612.09 11,528.37

2.5 Date of Planting and Cycle

SOU 23, Ulu Remis, Sime Darby Plantation Sdn Bhd estates age profiles are summarized as

14.89% immature palms, 83.97% mature palms and 1.14% tall palms which is only available

in Ulu Remis Estate. A replanting program for all estates involved are available and being

projected for the next five (5) financial years (FY11/12 to FY15/16). The age profiles for all the

estates are summarized in Table 4 below.

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Table 4: Planting Age Profiles for all Supply Base Estates

Name of supplying

estate

Planting Age (Ha)

Immature >4 - 14 years >14 - 25 years >25 years

Tun Dr Ismail Estate 939.55 1,757.64 1,389.99 0

Ulu Remis Estate 540.49 1,131.47 557.10 184.45

Pekan Ropel Estate 6 2,701.94 419.53 0

Sembrong Estate 356.74 324.92 963.69 0

Bukit Badak Estate 565.00 1,516.00 1,010.00 0

Cenas Estate 0 1,375.74 428.81 0

Total 2,407.78 8,807.71 4,769.12 184.45

2.6 Other Certification Held

During the audit, Sime Darby Plantation Sdn Bhd Strategic Operating Unit 23 (SOU 23)

currently is being certified under RSPO and ISCC schemes.

2.7 Organizational Information and Contact Person

The company contact person details are as follows:

Name: Mohd Shafril Baharudin

Designation: Mill Manager

Address: Ulu Remis Palm Oil Mill,

P.O. Box 107,

81850 Layang-Layang, Johor

Contact No.: +6013 5845 492

+607 7527 126

Email address: [email protected]

2.8 Time-bound Plan for Other Management Units

Sime Darby Plantation Sdn Bhd is a member of RSPO and has been involved in the

certification since 7 September 2004. The membership number with RSPO is 1-0008-04-000-

00.

Sime Darby Plantation Sdn Bhd owns and operates with 62 strategic operating units covering

approximately 521,924ha in Malaysia and Indonesia. They have developed a time-bound plan

(Appendix C) for the phased implementation of the RSPO P&C, commencing with mills and

estates. Sime Darby Plantation Sdn Bhd will use the experience gained from achieving

certification of the first few mills and estates to implement the RSPO P&C in parallel with the

remainder of its operations. The SGS assessment team considers that Sime Darby Plantation

Sdn Bhd is on the right track which is reasonable and challenging, given the widespread

geographic locations of its properties, the resources required and the numbers of smallholders

involved.

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2.9 Area of Plantation

The areas of supplying estates for this operating unit are listed in Table 5. Details of production

area (mature/immature) are also listed.

Table 5: Area Statement of the Supplying Estates

Name of supplying estate

Estates Area (Ha)

Immature Mature Area Non-Cultivated Total (Ha)

Tun Dr Ismail Estate 939.55 3,147.63 190.42 4,277.60

Ulu Remis Estate 540.49 1,873.02 194.98 2,608.49

Pekan Ropel Estate 6 3,121.47 0 3,127.47

Sembrong Estate 356.74 1,288.61 46.36 1,778.78

Bukit Badak Estate 565 2526 0 3,091.00

Cenas Estate 0 1,804.55 74.77 1,879.32

Total 2,407.78 13,761.28 506.53 16,762.66

2.10 Date Certificate Issued and Scope of Certificate

The certificate issue date is the date of RSPO approval of this assessment report. This

certification scope is “Receiving and processing of RSPO certified Fresh Fruit Bunches (FFB)

from its supply base, production and sales of RSPO certified Crude Palm Oil (CPO) and Palm

Kernel (PK) under Module D (CPO Mill: Segregation) of RSPO Supply Chain and RSPO MY-NI

Standard”.

3. ASSESSMENT PROCESS

3.1 Certification Body

Founded in 1878, the SGS Group is the world’s largest auditing, inspection, testing and

verification organization. Truly global and benefiting from unique international network of more

than 1,180 offices, 321 laboratories and 70,000 full time staff, the SGS Group is able to provide

its international clientele with a comprehensive range of services in more than 145 countries.

SGS has no manufacturing, trading or financial interests which could compromise its

independence. Its guarantee of independence, its reputation for professionalism, integrity and

impartiality, as well as it remarkable international network, place the SGS Group in a unique

position.

The RSPO Programme is the SGS Group’s RSPO Certification Programme internationally

accredited by the RSPO Executive Board to carry out oil palm plantation and supply chain

certification/verification and accreditation for global RSPO certification.

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3.2 Assessment Methodology, Programme, Site Visits

The assessment was conducted in three audit days and involving two sampled estates (Bukit

Badak and Pekan Ropel Estate) of SOU 23, Ulu Remis, Sime Darby Plantation Sdn Bhd. The

audit covers documentation review, internal procedures, management system, field inspection

as well as identification of any significant issues for both environment or social issues.

The assessment was conducted based on random samples and therefore nonconformities may

exist which have not been identified. The methodology for objective evidence collection

included physical site inspection, observation of tasks and processes, interview with workers,

families and stakeholders, documentation review and monitoring data. The assessment

program is included as shown in Table 6 below.

Table 6: Assessment Program

Date Location Activities

26th

Mar 2013 Ulu Remis Estate Clubhouse

Opening Meeting by SGS

Presentation of previous CAR closure

Bukit Badak Estate Meeting Room

Documentation Review

Good Agricultural Practices

High Conservation Value

Boundary Stone

Social (Interview with workers)

Storage facilities

Landfills

Recaps on findings of Day 1

27th

Mar 2013 Pekan Ropel Estate Meeting Room


Good Agricultural Practices

High Conservation Value

Boundary Stone


Storage facilities

Landfill

Recaps on findings of Day 2

28th

Mar 2013 Ulu Remis Palm Oil Mill Meeting Room


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Storage Facilities

Safety and Health

Composting Plant

Waste discharge visit

Ulu Remis Estate Clubhouse

Closing Meeting by SGS

Presentation of audit findings and CAR raised

3.3 Qualification of Lead Assessor and Assessment Team

SGS Malaysia Sdn Bhd holds copies of educational qualifications, certificates and audit logs for

each of the audit team members. SGS has evaluated the qualifications and experience of each

audit team member and has registered the following designations for conducting RSPO

Assessment. Summary of auditors’ educational background and experience are listed in Table

7 below.

Table 7: Auditors Profile

Evaluation Team Notes

Lead Auditor James Ong, a Bachelor of Agriculture Science holder and agronomist in SGS (M) Sdn Bhd. He has many years working experience in agriculture sector in Malaysia and has been working in estates as well in the agrochemical and fertilizer industry. He is well versed with agrochemical and fertilizer applications. Has undergone ISO 14001 and RSPO Lead Auditor training and involved in a number audits on oil palm plantations.

Auditor Hoo Boon Han is the SGS SEAP Program Coordinator, Bio Fuels Sustainability. He has successfully completed the RSPO Lead auditor training course for both P& C as well as the Supply Chain. He has conducted both P&C audits as well as Supply Chain audits.

Trainee Auditor Muhammad Shazaley Abdullah, a graduate in Bachelor of Forestry Science, is a Trainee Auditor for Roundtable on Sustainable Palm Oil (RSPO). He has attended an awareness training of RSPO and currently undergoing training session as an auditor in future to serve the industry well.

3.4 Stakeholder Consultation and List of Stakeholders Contacted

This is Annual Surveillance Audit 02, hence no stakeholder’s consultation conducted. However,

some of the stakeholders met during the visit were interviewed and no issues raised regarding

the performance of SOU 23, Ulu Remis.

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4. ASSESSMENT FINDINGS

4.1 Summary of Findings

4.1.1 Principles & Criteria

As outlined, objective evidence was obtained separately for each of the RSPO Indicators and criterion

for the mills and estates. The results for each indicator from each of the operational areas were

evaluated to provide an assessment of conformity. A statement is provided for each of the RSPO

indicators in order to support the findings of the assessment team.

There is 3 Major Non-conformities and 3 Minor Non-conformities identified during this assessment.

Some areas identified with potential areas for improvement has leaded into 9 Observations raised.

Details for each Non-conformities and observations are given in Appendix C. Major Non-conformities

has been closed out within the period of 60 days after the assessment. Minor Non-compliances and

Observations will be followed up during the next Annual Surveillance Audit which is scheduled to be

conducted within the period of twelve months after RSPO approval of this report.

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 language & forms to allow for effective participation in decision making.

1.1.1 Records of requests and responses must be maintained. Major

Findings In compliance: Yes: X No:

Objective evidence:

There is no request for information from stakeholders yet received by the estate. However, record of stakeholder meeting is available. Latest meeting with stakeholder conducted on 12 March 2012 to explain about the implementation and RSPO certification. The next meeting will be in April 2013. List of stakeholder FY2011/2012 are available but need to be update. Sample of stakeholders listed are:

BSN Layang-Layang

Sekolah Kebangsaan Layang-layang

Banli Construction Sdn Bhd

NUPW Representative

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

1.2.1 Land titles / user rights (C 2.2)


Objective evidence:

Land titles for Bukit Badak Estate for palm oil planting are available with total area are 3244.5378

Ha. The list of land titles are as follow:

Land Title No. Area (Ha)

GRN 83741 722.3638

GRN 80931 1787.0918

GRN 80742 40.1348

GRN 80743 43.3013

GRN 89426 412.0212

GRN 89427 239.6249

Total 3244.5378

Evidence of five land titles for Pekan Estate with total area of 3237.5802 Ha is available. All the

land titles are meant for palm oil plantings. List of the land titles for Pekan estate are as follows:

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H.S. (D) 521 2832.795

GRN 3847 282.1066

GRN 3848 69.6465

GRN 3849 49.6954

GRN 3864 3.3367

Total 3237.5802

1.2.2 Safety and health plan (C 4.7)


Objective evidence:

Sime Darby has a policy on the implementation of OSHA and published publicly in their website. Bukit Badak estate has appointed a safety committee and the meeting will be conducted every three months. An organization chart of safety committee FY2012 is available.

Training plan for Bukit Badak estate FY2012/2013 covers Environment, Safety & Health Program FY 2012/2013. The plan is including ESH Risk Assessment, Chemical Safety Management, Scheduled Waste Management and Emergency Preparedness and Responses.

A letter of appointment for OSHA representative is available for:

En. Mohd Nor Idham Razali – 7 Jan 2013

En Zahari Hassan – 7 Jan 2013

1.2.3 Plans and impact assessment relating to environmental and social impacts

(C 5.1, 6.1, 7.1, 7.3)


Objective evidence:

Environmental Aspect and Impact Identification form for Bukit Badak estate is updated FY 2012/2013. Examples of environmental aspect and impact assessed are:

Main Entrance

Compound (Grass Cutting, Herbicide Spraying)

Weeding and Spraying (Maintenance Spraying Equipment, Selective weeding)

Road Maintenance (Re-Surfacing, Grading)

Environmental Aspect and Impact Identification Form for Pekan estate is updated FY 2012/2013. The form is maintain in EMS/01/5.4.3 folders and covers all activities and areas involved in the estate operations. Examples of the environmental aspect and impact identified are:

Harvesting and Collection

Pest and Diseases Control

Road Maintenance (Grading, Re-surfacing)

FFB Transportation (FFB Stacking, Net Fixing and Sealing, FFB Loading)

1.2.4 Pollution Prevention Plan (C 5.6)


Objective evidence:

There is no Pollution Prevention Plan available in Bukit Badak estate.

Pollution prevention plan to reduce pollution from water in Pekan Estate is available:

Pollution Source Waste Produced Reuse/Recycle Method/Treatment

Method

Chemical Mixing Area Water spillage Recycled for chemical mixing / Water Sump

Sprayer washing Area Cleaning water Recycled for chemical mixing / Drains

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(Mixed with Chemicals)

Workshop Cleaning water Drains / Oil trap

1.2.5 Details of complaints and Grievances (C 6.3)


Objective evidence:

Procedure is available as in Appendix 5: Sustainability Plantation Management System, Flowchart and Procedure on Handling Social Issues dated 1 November 2008.

The procedures are also publicly available at the company website as follow:

- http://www.simedarbyplantation.com/Negotiation_Procedures.aspx

1.2.6 Negotiation procedures (C 6.4)


Objective evidence:

Procedure is available as in Appendix 5: Sustainability Plantation Management System, Flowchart and Procedure on Handling Social Issues dated 1 November 2008.

The procedures are also publicly available at the company website as follow:

- http://www.simedarbyplantation.com/Negotiation_Procedures.aspx

1.2.7 Continuous improvement plan (C 8.1)


Objective evidence:

Budget allocation for social and environment responsibility is available as located in Budget FY1213 Ladang Pekan.

Principle 2: Compliance with Applicable Laws and Regulation

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

2.1.1 Evidence of compliance with legal requirements Major


Objective evidence:

Bukit Badak and Pekan estate has compiled a list of Legal and Other Requirements Register (LORR). The list was compiled in QSHE/04/5.2.4 folder. Latest update for Pekan estate was on 9 July 2012 and approved by Mr. Abdul Malik Yasin. The list covers legal requirements such as:

a) Environment

b) Safety and Health

c) Fire Services

d) Factories and Machinery

e) Housing and Amenities

f) Labour

g) EPF

h) SOCSO

i) Union

The mill and estates has renewed permits required by the law. Amongst the licences or permit viewed were :

a) MPOB license: 544448004000 ( 30/11/2013) for 288,000MT

b) DOE Licence: 001575 (30/6/2013) for 60 MT/hr and land application (atas tanah)

c) Calibration (weighbridge) B585304 Avery L200 – 40MT (recently calibrated 25/3/13)

d) Calibration (weighbridge) B797231 Avery 1110 – 60MT (last calibrated 4/12/12)

e) Licences for Mechmar and Empire Boilers, De-aerator, back pressure Receiver steam separator, air receiver and etc. were also viewed and found to be valid.

Mill has a file “QSHE/04/5.2.4 Legal and other requirement Register” updated on 6th

March 2013 by QA Supervisor; Mr. P. Seharan and contains OSH, Environmental, General legal references.

http://www.simedarbyplantation.com/Negotiation_Procedures.aspx


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


Objective evidence:

All legal requirements were compiled in LORR and made available to the auditor during the audit. The procedure to updates and must comply with the legal requirements is available in Estate Quality Management System, Level 2: Standard Operating Manual, Appendix 5.2.4a: Procedure for Legal and Other Requirements dated 1 April 2008.

2.1.3 A mechanism for ensuring that they are implemented Minor


Objective evidence:

A mechanism to ensure compliance of law is documented in Agricultural Reference Manual (ARM) which has been distributed to the SOU and is implemented throughout the Mill as well as the states. The procedure to updates and must comply with the legal requirements is available in Estate Quality Management System, Level 2: Standard Operating Manual, Appendix 5.2.4a: Procedure for Legal and Other Requirements dated 1 April 2008.

The Standard Operation Manual, clearly stated that PSQM Department (formerly known as TQEM) will undertake the responsibility of identifying, managing, updating and tracking the legal requirement.

2.1.4 A system for tracking any changes in the law Minor


Objective evidence:

The Standard Operation Manual, clearly stated that PSQM Department (formerly known as TQEM) will undertake the responsibility of identifying, managing, updating and tracking the legal requirement.

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

2.2.1 Evidence of legal ownership of the land including history of land tenure Major


Objective evidence:

Land titles for Bukit Badak Estate for palm oil planting are available with total area are 3244.5378

Ha. The list of land titles are as follow:


GRN 83741 722.3638

GRN 80931 1787.0918

GRN 80742 40.1348

GRN 80743 43.3013

GRN 89426 412.0212

GRN 89427 239.6249

Total 3244.5378

Evidence of five land titles for Pekan Estate with total area of 3237.5802 Ha is available. All the

land titles are meant for palm oil plantings. List of the land titles for Pekan estate are as follows:


H.S. (D) 521 2832.795

GRN 3847 282.1066

GRN 3848 69.6465

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GRN 3849 49.6954

GRN 3864 3.3367

Total 3237.5802

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


Objective evidence:

All land titles (Borang 5BK) for both Pekan and Bukit Badak estate are specifically meant only for palm oil planting purposes.

2.2.3 Evidence that boundary stones along the perimeter adjacent to state land and other reserves are being located and visibly maintained

Minor


Objective evidence:

Visit to Pekan estate evidence a boundary marking available along the boundary trenches. The marking is available every 100m along the boundary. A boundary marking is observed maintained along boundary trenches with smallholders in Field 03C.

2.2.4 Where there are, or have been, disputes, proof of resolution or progress towards resolution by conflict resolution processes acceptable to all parties are implemented. (CF 2.3.3, 6.4.1 and 6.4.2)

Minor


Objective evidence:

There is no dispute reported at the time of audit. Bukit Badak estate is bordering with other Sime Darby Plantation estate under SOU 23.

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.

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


Objective evidence:

There is no dispute reported at the time of audit.

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


Objective evidence:

There is no dispute reported at the time of audit.

2.3.3 Copies of negotiated agreements detailing process of consent (C 2.2, 7.5, 7.6) Minor


Objective evidence:

There is no dispute reported at the time of audit. However, the procedure for negotiation is made publicly available in the company website at:

http://www.simedarbyplantation.com/Boundary_Disputes_.aspx

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

3.1.1 Annual budget with a minimum of 2 years of projection Major


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Objective evidence:

Annual budget for 5 years cost comparison available. Annual budget for FY13/14 and FY 14/15 are available. The budgets also include work to support sustainability as well as operational budget. The cost budgeted FY13/14 is RM 15,327,618 and FY14/15 RM 15,210,047 including manuring cost. Cost per hectare is also available in the budget RM 5,414.21 (FY13/14) and RM 5,203.57 (FY14/15).

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


Objective evidence:

Replanting program for five years is available in Replanting Programme 2013/2014 to 2012/2018 and there is no replanting in in Bukit Badak in FY12/13.

Replanting projection for Pekan estate is available as evidence in summary of replanting program. There is no replanting took place in FY12/13 and 13/14.

Principle 4: Use of Appropriate Best Practices by Growers and Millers

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

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


Objective evidence:

Evidence of documented procedure is available during the audit. The Agricultural Reference Manual (ARM) for Oil Palm estates is available and issued on 1 July 2011. A procedure for Plantation Quality Management System is also available dated 1 November 2008 which contains the procedure for:

a) Policy and Objectives

b) Organizational Structure

c) Documentation and Communication

d) General Information (Land use, History, Location)

e) Planning

f) Quality, Safety & Health and Environmental Management

g) Implementation and Control

The unit will follow the following documentation as their SOP:

a) Agricultural Reference Manual – Guideline for work

b) Standard Operating Manual

c) EQMS Standard Operation Procedure

d) Sustainable Plantation Management System

e) Pictorial Safety Standard

These copies were marked as the ‘Control Copy’. Separate copies are reported to be accessible by estate staff. Copies of relevant sections were seen posted at workstations. The SOPs are currently available in English, with some sections available in Bahasa Malaysia

Ulu Remis Palm Oil Mill is operating based on Mill Quality Management System (SOP and Manual) dated 1 November 2008. The SOP explains the details of processes involved in mills daily operation such as:

a) Reception Station (Weighbridge, Loading Ramp, FFB Conveyor, Fruit Cages, Locomotive)

b) Fruit Handling Station (Tipper, Vehicles)

c) Sterilization Station (Sterilizer, Railway Line, Trolley Bridge)

d) Threshing Station (EFB Conveyor, FFB/EFB Elevator, EFB Ramp)

e) Pressing Station (Digester, Screw Press, Vibrating Screen, Crude Oil Pump)

f) Clarification Station (Sludge Tank, Vacuum Dryers, Centrifuges)

g) Depericarping Station (Cake Breaker Conveyors, Nut Polishing Drums, Fibre Cyclone)

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h) Kernel Recovery Station

i) Boiler Station

j) Product Storage and Despatch (CPO Storage Tank, Flowmeter, Despatch Conveyor)

k) Laboratory

l) Water Treatment Plant (Water catchment, Overhead Water Tank, Softeners)

m) Effluent Treatment Plant (Cooling Pond, Digester Tank, Aerobic and An-aerobic)

n) Workshop and Maintenance (Welding Set, Lathe Machine)

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

Minor


Objective evidence:

Pekan Ropel actively (daily) records of monitoring to check the quality of FFB. Other active monitoring programme is for the monitoring of fertilizer application. It is recorded in ‘Borang SBS’

file.

The rest of SOP’s monitoring is done by the PSQM and they are currently in the midst of revising the SOP. The latest internal audit was conducted on Nov 2012.

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

4.2.1 Monitoring of fertilizer inputs through annual fertilizer recommendations Minor


Objective evidence:

Agronomic and fertilizer report is prepared by Sime Darby Research Sdn. Bhd. Fertilizer recommendations made are based on palm nutritional status resulting from foliar analysis. Observed during the audit, the record of agronomic and fertilizer application and recommendation for 2013 is available for Bukit Badak estate. Currently the estates are using the following fertilizer list:

Rock Phosphate (27% P2O5)

Kieserite (27% Mg)

Ammonium Chloride (24% N)

Muriate of Potash (60% K2O)

Borate (48% B2O3) Application of fertilizer is monitored and recorded in Form A: Fertilizer Application. As example,

Field 92A recommended to apply with 1.50kg Ammonium Chloride per palm, total SPH are 134 and the total fertilizer to apply are 137 bags. The applications were recorded in Bukit Badak Fertilizer Application Form and found met the requirements from Agronomist which has been completed on 3 January 2013.

Sime Darby Research Sdn Bhd will do the recommendation based on the leaf sampling results. They will issue a recommendation; 2013 Agronomic & Fertiliser recommendation report for – Oil Palm. The estate will use the recommendation to apply the fertilizer.

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


Objective evidence:

Foliar analysis is conducted twice a year by Sime Darby agronomist. Latest report of foliar analysis conducted on September 2012. Latest soil sampling conducted in Bukit Badak Estate is on 19 April 2010. The report was generated on 29 October 2010 by Sime Darby Research Sdn Bhd.

In R&D Agronomist file, records of Summary for periodic tissue/leaf sampling are found available. Latest soil sampling conducted at Pekan Ropel was done in 2009.

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


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Objective evidence:

No application of EFB and POME in Bukit Badak Estate. Sime Darby has practices zero burning planting techniques and there is no evidence of open burning observed in the field.

Application of EFB for beneficial plant is evidence in Pekan estate. Empty Bunches Book Record is available for the monitoring of field applied with EFB. As example, Field 01A is applied with 10.980MT EFB for the beneficial plant on 24 Feb 2013.

Criterion 4.3: Practices minimize and control erosion and degradation of soils.

4.3.1 Documented evidence of practices minimizing soil erosion and degradation (including maps)

Minor


Objective evidence:

The estates are practicing according to procedure stated in Sime Darby Agricultural Reference Manual (ARM) date 1 July 2011. Section 17: Leguminous Cover Crop Establishment explains the method of planting cover crop such as Pueraria Javanica, Calopogonium mucunoides and Mucuna Bracteata. Section 4: Land Preparation explains the method of terrace construction in

order to minimize soil erosion. A map of topography for Bukit Badak is available during the audit.

Sime Darby has a Slope & River Protection policy that emphasises protection of slopes and rivers (April 2011). Although during the audit, streams were found to be silted, there was evidence of the estate making efforts to minimise the impacts. In Pekan Ropel, field F96C roadside drain is being desilted as part of the maintenance and CSR programme.

4.3.2 Avoid or minimize bare or exposed soil within estates Minor


Objective evidence:

There is no evidence bare or exposed soils observed throughout the Pekan estate during the field visit. There is also no evidence of spraying along the road side as well as the buffer zone. Erosion and siltation along the waterways is evident due to the soil series (Renggam and Harimau) and flooded area.

4.3.3 Presence of road maintenance programme Minor


Objective evidence:

Road maintenance program FY2012/2013 is evidence in Bukit Badak meeting room. However, there is no works on road maintenance conducted since July 2012 until February 2013 due to weather (rainy season).

Under the ‘Ladang Pekan Budget 2012/13’, the road and bridges maintenance and upkeep are budgeted under code RB 01 & RB 02. It includes the following :

Grading & resurfacing

Desilting of the drains

There is also evidence of implementation of road maintenance programme in the work programme for Pekan Ropel Estate.

Although in the Pekan Ropel soil map, an area is identified as being soil was identified as peat/muck, however on site, the soil and palm growth do not seemed to have the characteristic associated with peat planting.

4.3.4 Subsidence of peat soils should be minimized through an effective and documented water management programme

Minor


Objective evidence:

There is no peat soil in Bukit Badak estate and hence no water management plan monitored.

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

Findings In compliance: Yes: No: X

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Objective evidence:

There is no peats and fragile soil in Bukit Badak estate and hence no management plan provided.

Soils of the estates are identified in the soil map. However the maps are not updated.

Soils series identified in Pekan Ropel are;

a) Harimau

b) Rengam

c) Peat/Muck

d) Organic clay

e) Holyrood

f) Local Alluvium

Minor CAR 20

A revised soil identification for Pekan Ropel was lacking as it was known that the area do not have peat soil.

Criterion 4.4: Practices maintain the quality and availability of surface and ground water.

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


Objective evidence:

Sime Darby has a policy on Slope and River Protection Policy dated April 2011 and signed by Executive Vice President. The policy stated the buffer zone required to maintain as follows:

River Width

>3m <5m 5-10m 11-20m 21-40m >40m

Buffer Zone

20m 5m 10m 20m 40m 50m

Major CAR 21

In Bukit Badak, areas within the buffer zone in field F07 & F95 were found sprayed.

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

Major


Objective evidence:

There is no construction of bunds and dams across the river. However, Bukit Badak estate do minor diversion from the river to flow into their collecting pond as water sources before pumped to treatment plant. The estate request permission with Pejabat Badan Kawal Selia Air Johor (BAKAJ) to get raw water from Sungai Belitong and approved by BAKAJ on 11 Sept 2012.

Pekan estate collects raw water from Sungai Penggeli for domestic use. A permit to get the water from SPAN is available with licenses number SPAN/EKS/(PT)/800-4(1)/6/08 and SPAN/EKS/(PT)/800-4(2)/2/08 which valid thru 1 Jan 2009 until 31 Dec 2011. A letter from SPAN dated 13 Oct 2010 enquires the names of responsible and qualified person to check and verify the treatment plant system, did not answer and replied.

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 5.1 and 8.1)

Major


Objective evidence:

Bukit Badak Estate does monitor water quality flowing through the estate. Sampling points are available in water Hydrology Map. Results of analysis are available from Spectrum Laboratories (Johore) Sdn Bhd. Latest report of water analysis received is dated 27 Dec 2012.

Pekan estate monitors the water quality for domestic use and flowing through their estate by taking

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samples from 6 sampling point. Water samples are submitted to Sime Darby Research Sdn Bhd. Latest results of water analysis is available dated 1 February 2013.

Mill records of water monitoring for DOE submission in the ‘Borang Penyata Suku Tahunan’. The latest quarter Oct - Dec 2012 was available for viewing.

The mill DOE licence is for land application discharge and the requirement is for the BOD 3 days, 30°C to be less than 5,000mg/l. As per the Licence, the final discharge for the land application is from the Secondary Pond 1 & 2as per the plan layout of the ponds. The last quarter report (Oct – Dec 2012) founds that the BOD results were 299, 254,305.

4.4.4 Monitoring rainfall data for proper water management Minor


Objective evidence:

Bukit Badak and Pekan Ropel did monitor the rainfall. The record of rainfall since 2004 is available during the audit.

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


Objective evidence:

Pekan estate did monitors the water usage per ton FFB produced. Total FFB produced in February is 4,737.68MT and total water usage is 46,318.80L equivalent to 9.77L/MT FFB yield.

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

Minor


Objective evidence:

There is no protected area in Bukit Badak and Pekan Ropel estate. All water usage and water quality in the estates is monitored by collecting water samples at the designated water sampling points. A water sampling map (Hydrology Map) is available for the auditors.

4.4.7 Evidence of water management plans Minor


Objective evidence:

Documented water management plan for Pekan estate is available in Environmental Impacts Evaluation files. The water management plan is evidence in Water Management Plan, Ladang Pekan which contains plans for:

a) Riparian Reserved/Buffer Zone

b) Areas where buffer zone not established

c) Water Quality Monitoring

Ulu Remis Palm Oil Mill has a documented water management plan. The plan includes:

a) Water consumption monitoring

b) Process water and Boiler usage monitoring

c) Contingency plans

d) Analysis

e) Meetings

f) Rain harvesting Project

Minor CAR 22

There is no documented evidence of water management plans available in Bukit Badak Estate.

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

4.5.1 Documented IPM system Minor

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Objective evidence:

Documented IPM system is available in both estates. IPM system is integrated into the Agricultural Reference Manual (ARM) which is disseminated to all estates. The latest version of the ARM is available and inspected. Observed that the IPM is incorporated in the ARM in Section 15: Plant Protection that covers the following items:

Occurrence of Rhino beetle in Young Oil Palm

Chemical Control of Common Oil Palm Pests

Bagworm and Nettle Caterpillar Control

Use of Beneficial Plants for Natural Control of Oil Palm Leaf Pests

Control of Rats in Oil Palm

Barn Owls for biological control of rats in oil palm

Control of basal and upper stem rot

Certification of best practices towards minimising ganoderma inoculum in replants

Use of arbuscular mychorrizal fungi for management of ganoderma basal stem rot

Chemical control on termite infestation

Section 16: Weeds Control indicates the procedure of implementation for the following items:

General weed control

VOPs eradication and general weed control in first year oil palm

Avoiding herbicide contamination of oil palm

In all the estates evaluated, elements of IPM have been observed. Pest and weed infestation is recorded as minimal in these estates. The introduction of biological control is being promoted and the use of Barn Owls for rat control is also being investigated. Some attempt has been made to establish beneficial predator and parasitoid host plants e.g. Tunera subulata, Cassia cobannensis and Antigonon leptopus.

4.5.2 Monitoring extent of IPM implementation for major pests Minor


Objective evidence:

Census for bagworms and rats are conducted and recorded in census book. The ideal rate for barn owl is 1box per 10 ha, however, due to low occupancy level in tall palm (<20%), the ration in Bukit Badak reduced to 1 box per 20 ha. Latest census for barn owl conducted in December 2012 as evidence in ‘Census File’ with the occupancy of 71%.

Monitoring of rat damage census done and recorded into ‘Census file’. When the damage reaches >5% damage, application of rat bait will be initiated. Records of application and acceptance is recorded in ‘Book Record Rat Baiting File’

The estate practices ‘Calendar Baiting’. Regardless of damage, 2 bait campaigns will be conducted during Jan-Feb and July-Aug annually.

4.5.3 Recording areas where pesticides have been used Minor


Objective evidence:

Recording and monitoring of areas where pesticides have been used evidence in the costing book for each operation.

4.5.4 Monitoring of pesticide usage units per hectare or per ton crop e.g. total quantity of active ingredients (a.i) used/tone of oil

Minor


Objective evidence:

In Pekan Estate, monitoring of pesticide usage units per hectare or per ton crop e.g. total quantity of active ingredients (a.i) used is documented in ‘Chemical Management’ file. In February 2013, the quantity of a.i applied are 0.042kg/ha and 0.048kg/MT of FFB produced.

Observation

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Monitoring of pesticide usage units per hectare or per ton crop e.g. total quantity of active ingredients (a.i) used/ton of oil was not available at Bukit Badak Estate.

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 categorized as World Health Organization Type 1A or 1B, or are listed by the Stockholm or Rotterdam Conventions, growers are actively seeking to identify alternatives, and this is documented.

4.6.1 Written justification in Standard Operating Procedures (SOP) of all agrochemical use

Major


Objective evidence:

Justification for agrochemical used is described in the ARM. SOP for chemical use is described in the ‘Standard Operation Procedure for Oil Palm Estates’ dated 1 Nov 2008. The company maintains an up-to-date list of chemical used in each estate and observation in the storage area and screening of the application record shows no evident of use of prohibited chemicals in SOU 23 operation. The estates maintain historical records of chemical used, amounts applied, dates, and areas of application.

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

Major


Objective evidence:

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

All pesticides used in estates operations such as Kenlon, Ally 20F, Antracol, Enviro-cyper, Floxil and BM-Glyphosate are registered products.

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


Objective evidence:

Empty pesticides containers were found not triple rinsed and pierced in the schedule waste storage at Badak estate.

Site visit to landfill area in Pekan estate (Field 98C) evidence the empty chemical container, empty lubricants container and paint can inside the landfills which are supposed to be in the Schedule Waste store.

Major CAR 23

Chemical container found not triple rinsed and pierced as required in both Bukit Badak and Pekan estate.

Reuse of empty plant protection product containers for purposes other than containing and trans-porting of the identical product (loose fruit scraper, diesel storage, potting container, storage of other products) was evidence in both estates.

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


Objective evidence:

Visit to Field 03A evidence that the mandore, Mr. M. Arsyad has a copy of MSDS. Interview conducted and evidence that he understands and being provided with training on chemical handling.

Observation 03

MSDS for the herbicide (Floxil) was lacking in Pekan Ropel Chemical Store although the a.i is

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similar to Kenlon and Triclopyr butoxy.

4.6.5 Annual medical surveillance as per CHRA for plantation pesticide operators Major


Objective evidence:

Annual Medical Surveillance for pesticides operators in Pekan Estate is available for all sprayers. Record of Occupational Medical Surveillance Programme (OMSP), Record Book for Muhamad Gupran (herbicide sprayer) dated 1 February 2012 is available. The latest medical surveillance conducted for all sprayers on 7 March 2013 but the report is not yet produced.

Observation 04

2012 annual medical surveillance as per CHRA for the Spray mandore (Misnah) and sprayer (Azri) records was missing in Bukit Badak estate.

4.6.6 No work with pesticides for confirmed pregnant and breast feeding women Major


Objective evidence:

No women sprayers’ evidence in Pekan estates.

4.6.7 Documentary evidence that use of chemical categorized as World Health Organization 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


Objective evidence:

No Type 1A or 1B chemical evidenced used in the estate.

4.6.8 Documented justification of any aerial application of agrochemicals. No aerial spraying unless approved by relevant authorities

Major


Objective evidence:

No evidence aerial spraying conducted in Bukit Badak and Pekan estate.

4.6.9 Evidence of chemical residues in CPO testing, as requested and conducted by the buyers

Minor


Objective evidence:

No buyer requested for testing of chemical residues in CPO.

4.6.10 Records of pesticides use (including active ingredients used, area treated, amount applied per hectare and number of applications) are maintained for either minimum of 5 years or starting November 2007

Minor


Objective evidence:

All pesticides used are recorded in the Stock card and in SAP computer recording system that was established in 2009.

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

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 (Act 139)

Major


Objective evidence:

a) Sime Darby Plantation has developed an OSH Policy which has been signed by Executive Vice President on April 2008 and made available for auditors. Environmental Safety and Health Program (ESH) for Bukit Badak as well as OSH Manual dated August 2008 can be

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found in OSHM files which contains information such as:

- OSH Policy

- HIRARC

- Workplace Inspection

- Chemical Safety

b) All operation risk were assessed and documented in the HIRARC, however in the Occupational Hazard Identification form, the specific type of PPE for Weeding was not identified.

c) Safety trainings have been conducted and records of the training were available in ‘Training’ file.

d) Appropriate PPE were distributed for the specific risk assessed operations and records of PPE issuance are kept in the PPE file.

e) Mr. Shahril Imran Ibrahim, Assistant manager was appointed as the safety representative for Pekan Ropel estate.

f) Regular safety meetings between the responsible persons and workers where concerns of workers about safety and health are conducted. Minutes of meeting (Minit Mesyuarat Ahli Jawatankuasa Keselamatan dan Kesihatan Pekerja Ladang Pekan) is available. Records of meetings conducted are as follows:

Pekan Ropel Estate

Reference Date No. of attendees

8/2012 15 March 2013 22

7/2012 28 December 2012 25

6/2012 25 Sept 2012 22

Ulu Remis Palm Oil Mill

OSH Meeting

18 January 2013 19

24 October 2012 16

13 July 2012 15

Major CAR 24

g) First Aid Kit was found not available at the worksite (Chemical Store) in Bukit Badak estate.

h) Workers which are not using proper PPE at the worksite are evidence such as:

Harvesting sickle without protective sheath (Linesite - Bukit Badak estate)

Manuring worker is not using proper mask (Bukit Badak estate)

CDA Sprayers are not wearing goggles during operation (F04A - Pekan Ropel estate)

FFB helpers at the unloading ramp did not use adequate hand gloves (Ulu Remis POM)

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

Major


Objective evidence:

Accidents records are available and recorded in PQSM-OSH Monthly Update records and kept in OSHA Monthly Updates files. All accidents records are reviewed on case by case basis and the findings from the review are discussed in OSH Meeting at least once every 3 months. Latest OSH Meeting conducted on 20

th Dec 2012.

There is also evidence of Borang JKKP 8 that need to be submitted to the Department of Occupational Safety and Health (DOSH) on yearly basis. Latest submission of Borang JKKP 8 was submitted on 3

rd January 2013.

Observation 05

Procedure for Identification of Hazard, Risk Assessment and Risk Control (HIRARC) dated November 2008 is made available. However, the HIRARC form was not updated since 2008.

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4.7.3 Workers should be covered by accident insurance Major


Objective evidence:

All workers are covered with insurance policy provided by RHB Insurance Berhad (Foreign Worker Compensation Scheme Certificate of Insurance). Workers in Bukit Badak estate are covered as per stated in Master Policy No. FW035659. The policy covers the workers for period of 1 July 2012 to 30 June 2013. Total of the workers covered in the policy are 146 people. The contract workers (not in the check roll) are not covered by estate but covered by the contractors.

Foreign workers of the Ulu Remis Palm Oil Mill are covered under the ‘Foreign Worker Compensation Scheme’. The 14 foreign workers are covered in Policy No: FW 035795 which is valid thru 30 June 2013 while local workers are covered by SOCSO and /or NUPW insurance.

Criterion 4.8: All staffs, workers, smallholders and contractors are appropriately trained.

4.8.1 A training programme (appropriate to the scale of the organization) that included regular assessment of training needs and documentation, including records of trading for employees are kept

Major


Objective evidence:

A training program FY12/13is available. The training program includes:

Foreign Workers Induction Training

Chemical & Spraying Safety Training

Emergency Respond Plan

First Aid

Chemical Handling Training

Scheduled waste management

Harvesting Safety

Records of training conducted are available and kept in Training Card files. Training that has been conducted are as follow:

Date Training Title Trainer Participants

16 Mar 2013 First Aid Training Hj. Ghani Kider (HA) 9

27 Feb 2013 Driving Skills Training Foremen 2

27 Feb 2013 Safety at Workplace M. Faiz 22

5 Feb 2013 ESH Dialogue with

PSQM

Husamuddin Abd Rani

(OSH Officer)

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.

5.1.1 Documented aspects and impacts risk assessment that is periodically reviewed and updated

Major


Objective evidence:

Sime Darby Plantation PSQM team and both estates (Badak & Pekan) have carried out environmental aspect and impact identification for all the activities involved in the estate and mill. The identification report was been reviewed November 2012.

Evidence of activities being reviewed in Bukit Badak estate is construction of new building. A report on aspect and impact identification is updated.

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5.1.2 Environmental improvement plan to mitigate the negative impacts and promote the positive ones, is developed, implemented and monitored

Minor


Objective evidence:

SOP for handling of environmental aspects was implemented at the estate level. In Bukit Badak estate, rainwater has been harvested for cleaning purpose. Oil traps were installed around the workshop to avoid oil being discharged directly into the drain.

For the mill, environmental management plan has been updated. Action such as fabricate boiler ash containment wall and to close the monsoon drain line and divert all drain water to cooling pond has been verified on field.

Criterion 5.2: The status of rare, threatened or endangered species (ERTs) and highly conservation value habitats, if any, that exist 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.

5.2.1 Identification and assessment of HCV habitats and protected areas within land holdings and attempt assessments of HCV habitats and protected areas surrounding landholdings

Major


Objective evidence:

The PSQM team has prepared the biodiversity baseline assessment report for SOU 23 dated January 2009. The demographic pattern of the estates shows the variety of undulating, hilly and swamp and low lying area. Two types of HCV were found in SOU23 which are HCV 4 and HCV6.

Observation 06

The biodiversity baseline assessment report for SOU 23 did not include Cenas estate and shall update the assessment report up to the year.

5.2.2 Management plan for HCV habitats (including ERTs) and their conservation Major


Objective evidence:

The management plan for HCV habitat includes set aside nature conservation area, inspection and rehabilitation and habitat enhancement. The monitoring programs will be conducted annually and throughout the year, any sighting or identification on new ERT species will be recorded accordingly.

Action plan for biodiversity of Bukit Badak estate is available and up to date. An example such as identification of riparian reserved/buffer zone which will be carried out on September 2013.

Water sampling analysis was conducted at the upstream and downstream of the river twice a year.

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


Objective evidence:

Signage was observed around the estate during onsite audit to prohibit illegal hunting and fishing. Interviewed to the workers at the line sites and they understand the company policies.

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

5.3.1 Documented identification of all waste products and sources of pollution Major


Objective evidence:

The mill and estates has documented identification of all waste product and sources of pollution. They will use the environmental aspect and impact identification form and update the new form if there is any new activity as well as the SOP for handling.

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5.3.2 Having identified wastes and pollutants, an operational plan should be developed and implemented to avoid or reduce pollution

Minor


Objective evidence:

For estate, the SOP for handling of environmental aspects for estate was established. An example, handling of waste oil and handling of diesel and petrol is documented clearly with the procedures.

SOU 23 has appointed Syarikat Perniagaan Saudara Baru (JM0137228A) to collect the scheduled waste such as lubricant oil (SW305) and used oil filter (SW410). An example, the latest consignment note for schedule waste is 18 Feb 2013.

For the plastic pesticide container, G-Planter Sdn Bhd has been appointed as the contractor. Besides, SOU23 has kept all the record of schedule waste inventory up to date.

Minor CAR 25:

a. In Badak estate, oil drums were found in the scrap yard without proper containment. Oil stain and spillage were observed around the oil drum near the line sites. At the schedule waste storage area, chemical container were found without triple rinse and punched.

b. Pesticide containers were observed in the landfill for disposal of Pekan Robel estate domestic waste.

5.3.3 Evidence that crop residues/biomass are recycled (Cross reference C 4.2) Minor


Objective evidence:

EFB are recycled and applied on the field as mulch especially on the beneficial plant. Pruned fronds are found stacked along the palm inter-row to minimize soil erosion.

In the mill, monthly monitoring of the production for biomass such as fiber, shell and EFB is available.

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

5.4.1 Monitoring of renewable energy use per ton of CPO or palm product in the mill Minor


Objective evidence:

Monthly monitoring of renewable energy (renewable energy/ ton CPO Processed) is available. Monthly biomass production has been recorded for fiber, shell and EFB. Fiber and shell will be used as the boiler fuel.

For FY2012-2013, the renewable energy (renewable energy/ ton CPO Processed) for February is 0.88.

5.4.2 Monitoring of direct fossil fuel use per ton of CPO or kW per ton palm product in the mill (of FFB where the growers has no mill)

Minor


Objective evidence:

There is no diesel consumption in the mill operation.

The mill is using steam turbine and electricity from TNB grid. For FY2012/2013, in February, the mill’s usage of electricity from TNB per ton CPO produced is 6.796kWh.

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.

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


Objective evidence:

No open burning was observed during onsite audit.

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

Minor


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Objective evidence:

No replanting for both estates during the visit.

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


Objective evidence:

Onsite audit confirmed that there is no evidence of burning waste either at Ulu Remis Palm Oil Mill, Bukit Badak estate and the line sites.

However, minor burning of domestic waste is evidence in Pekan Ropel linesite.

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

5.6.1 Documented plans to mitigate all polluting activities (Cross reference C 5.1) Major


Objective evidence:

The Environmental Improvement Plan/Pollution Prevention Plan has indicated environmental issues and mitigating measures with the time frame. Environmental issues such as diesel flow into the drain during filled up is mitigated by constructing bund and pit.

5.6.2 Plans are reviewed annually Minor


Objective evidence:

The plans are reviewed annually as the updated version is dated 21st December 2012.

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

Minor


Objective evidence:

There is no peat soil in SOU 23.

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.

6.1.1 A documented social impact assessment including records of meetings Major


Objective evidence:

Baseline Social Impact Assessment (SIA) Johor Zone (SOU 23) copy was made available at Pekan Ropel estate. The assessment has been carried out on 16

th - 19

th Dec 2008 and includes:

a) Scope of SIA

b) Objective

c) Methodology

d) Scoping approach

e) SOU 23 Estate Development and Impact on Communities

f) Stakeholder and Internal relations

g) SIA Summary Analysis

h) Social Management plan

i) Meetings

j) Appendix , Q&A

In the previous audit it was also noted that the baseline Social Impact Assessment (SIA) SOU 23 Johore South Zone for Cenas Estate was carried out at on 22

nd March 2011.

Observation 06

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The baseline Social Impact Assessment (SIA ) Johor Zone SOU 23 copy for Bukit Badak was not available

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

Minor


Objective evidence:

In Bukit Badak estate, minutes of the meeting conducted on 12th

Mar 2012; “Minit Mesyuarat Stakeholder untuk pematuhan persijilan RSPO” was available for auditors view as well as the attendance list. The parties involved in the meeting are Bukit Badak Management, NUPW representative, external stakeholders, staff and workers. Topics discussed in the meeting are:

a) Stakeholder introduction

b) Safety and Health of workers

c) Social

d) RSPO principles

Minutes of the stakeholder meeting, “Minit mesyarat tahunan bersama JKKP Kampung & Pekebun Kecil Ladang Pekan 05/2013” conducted in Pekan Ropel estate was found kept in the Communication file. The meeting has been conducted on 22

nd Feb 2013 and the meetings

contents are as follows:

a) Keselamatan Pengeluaran Buah

b) Sempadan Tanah

c) Comments by Ketua Cawangan Kg Sri Pekan

Observation 07

Evidence of participation for Pekan Ropel stakeholder was lacking in the SIA assessment done in 2008.

6.1.3 A timetable with the responsibilities for mitigation and monitoring is reviewed and updated as necessary

Minor


Objective evidence:

In Pekan Ropel, under the ‘Management Plan on Social Impact Assessment’ dated 5 Nov 2012, the following was identified :

a) Areas of concerns/Findings

b) Mitigation Measures

c) Action Plans

d) PIC

e) Status

f) Expected completion Date

g) Remarks

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.

6.2.1 Documented consultation and communication procedures Major


Objective evidence:

There is a procedure for communication and consultation between growers or millers and stakeholders within and surrounding the landholdings. The documented procedures are found in the Sustainable Plantation Management System (Version 1: 2008).

Documents were available to specify procedure to be applied upon the receiving of the complaints from the stakeholders until the issues resolved either through a direct negotiation, using arbitration or through legal proceedings.

In addition, a flowchart describing the steps to be taken from the receiving of complaints until the issues resolve is made available to the auditing team in the same document. The procedures are also available in the company website as follow:



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6.2.2 A nominated plantation management official at the operating unit responsible for these issues

Minor


Objective evidence:

Evidence of nominated official as a responsible person on all social related issues is available. In summary, the nominated official is obliged to conduct the following responsibility:

Investigate any report or claim with regard to social issues and to recommend applicable disciplinary act, where necessary;

Keeping all record of reports and action taken for each of reports received;

Provide advice and counselling to workers that need such service; and

Assist the estate management in organizing any social related events.

In Bukit Badak Estate, En Ghani b Kider (Hospital Assistant) was appointed on 7 July 2012 for the responsibility. An appointment letter “Perlantikan sebagai pegawai rasmi yang bertanggungjawab ke atas isu-isu sosial untuk Ladang Bukit Badak”.

In Pekan Ropel Estate, En Syed Ikram Zikri Hafizan (Assistant Manager) was appointed on 7 Sept 2012 for the responsibility. An appointment letter “Perlantikan sebagai pegawai rasmi yang bertanggungjawab ke atas isu-isu sosial untuk Ladang Pekan Ropel”.

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


Objective evidence:

Updated list 2012/13 of stakeholders for Pekan Ropel estate is available. These include transport workers, contractors, workers supplier, pharmacy, chemical supplier, coffee shop, bank, vendors, local community heads, local authority services, government agencies and etc.

As in 6.1.2, the records of meetings minutes were available. Issues raised were recorded and the management will raise an ‘Action or to be taken’.

Observation 08

However, there is no documented evidence of the issue being resolved or closed (e.g. smallholder enquiring on the time the gate will be locked).

List of stakeholders is not updated at Bukit Badak estate.

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.

6.3.1 Documentation of the process by which a dispute was resolved and the outcome Major


Objective evidence:

The procedures for handling complaints and grievances are outlined in the Procedures on Handling Social Issues of the Sustainable Plantation Management System document. The procedures dated 1 Nov 2008 specifies the process in receiving and addressing the grievances received from the stakeholders until the ultimate means in resolving issues (i.e.: through the legal proceeding). Meetings with external stakeholders and the grievance resolution books at individual estates have been initiated.

The mill has a copy of the flow chart in Bahasa Malaysia and is found in their “Social” file.

6.3.2 The system resolves disputes in an effective, timely and appropriate manner Minor


Objective evidence:

The document, QSHE/02/4.2.3, details the procedures and mechanism applied to resolve all disputes and grievances raised by the relevant stakeholders is maintained.

Currently, there is no disputes occurring in SOU 23 and hence the verification on the effectiveness of the system cannot be verified.

Communication to the affected parties is evidenced. For instance, any social issues is

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communicated through either Gender Committee (for women issues) or during briefing during daily Muster Call or during the Safety and Health Briefing.

The established grievance procedures specifies the estimated time shall be taken for each of the process to be addressed before proceed to the subsequent process.

The flowchart ‘Flowchart and Procedure on Handling Social Issues’ or in Bahasa Malaysia, ‘Carta Aliran Pengendalian Isu Sosial’, details the process and mechanism applied to resolve all social disputes by the relevant stakeholders.

The flowchart specifies the estimated time of initial negotiation between the management and the disputed parties within 2 weeks after the issue is raised before proceed to the subsequent process.

For the mill, Cik Maizatul Shahera, (Assistant Mill Engineer) was appointed as the nominated representative. In addition, Mr. Seharan, (Mill Supervisor) will assist in the communication as most of the workers in the mill are male workers. Communication to the affected parties is evidenced.

Currently, all issues or disputes occurring in the Mill are recorded in the “Communication” file and a form, ‘Borang Komunikasi/Aduan’ is used by the applicant.

In the file, an applicant’s Mr. S. Letchunanan recorded on 16 Jan 13 was closed by 11 Feb 13. On more serious disputes that relates to safety and security, the estate and the mill have auxiliary police manning the gates and they will be called for assistance when required.

6.3.3 The system is open to any affected parties Minor


Objective evidence:

Communication to the affected parties is evidenced. Minutes of meeting are available and documented. For instance, any social issues is communicated through either :

Gender Committee (for women issues),

During briefing during daily Muster Call ,

During the Safety and Health Briefing or bringing the issued up to the estate NUPW representative.

NUPW union meeting

Submission of the ‘Communication’ form

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.

6.4.1 Establishment of a procedure for identifying legal and customary rights and a procedure for identifying people entitled to compensation

Major


Objective evidence:

There is no dispute reported at the time of audit. However, the procedure for negotiation is made publicly available in the company website at:


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


Objective evidence:

There are no indigenous communities within or surrounding SOU 23 that holds legal or customary rights over the land.

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

Minor


Objective There are no indigenous communities within or surrounding SOU 23 that holds legal or customary


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evidence: rights over the land.

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

6.5.1 Documented of pay and conditions Major


Objective evidence:

Discussion with workers and Union leaders revealed that the payments made to workers are

above the industry norm. Each worker received his/her pay before the 7th of the next month and a

pay slip that contains clear details of the salary paid and deductions made that is as follows:

a) Details of employee & work days

b) Pendapatan (Basic Pay, Overtime, Price Bonus, Phone allowance, Holiday pay, etc.)

c) Potongan / Contribution (EPF, SOCSO, Advances, Electricity, NUPW)

Several payslips for workers of Bukit Badak are evidenced as below:

a) Misnah b Othman (Mandore) payslip:

- Income: RM1,453.61

- Deduction/Contribution: RM455.65

- Net pay: RM 997.96

b) Arumugan a/l Muniandy (NUPW Representative) payslip:

- Income: RM1,304.48

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


Objective evidence:

In Pekan Ropel, the foreign worker’s work contracts are verified. The contracts are written in English for Indian or Bangladesh workers and Bahasa Malaysia for Malay and Indonesian workers.

During registration the following records are kept:

a) Employee registration Card

b) Terms of environment

c) Copy of the passport

d) Certificate of attendance for Induction course by MAPA

e) Surat penyerahan passport

f) Borang Maklumat pekerja asing dan keperluan asas peribadi

g) Kontrak Pekerjaan- Tenaga kerja asing Semenanjung alaysia

h) Lampiran – Ganjaran RM200 bagi pekerja asing – pindaan 1st Jun 2012

.

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


Objective evidence:

SOU 23 provide adequate housing, water supplies, medical, educational and welfare amenities in accordance with Workers’ Minimum Standard of Housing and Amenities Act 1990 (Act 446). Pekan Ropel estate is in the midst of obtaining the access to piped water from Johor state water authorities (SAJ). The housing also has a sanitary/toilet facilities, shower area and cooking area within the house.

Electricity is from the Grid and the charges are deducted from workers pay. Domestic waste is collected three times per week and sent to the landfill within the estate.

There is an estate clinic with a hospital assistant to treat minor injury and sickness. Education at primary level is supported for children from the estate as well as the surrounding area. Social,

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cultural and recreational activities and places of worship are supported. Public health services provided in housing areas. Physical amenities are provided, effectively operated and maintained to a standard equivalent to an urban authority.

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.

6.6.1 Documented minutes of meetings with main trade unions or workers representatives

Major


Objective evidence:

There is proof of documented minutes of meetings with representatives of the National Union of Plantation Workers (NUPW) at the mill and estate levels. The representative for Bukit Badak estate is Mr. N. Arumugan. He has been working with the estate for more than 20 years. The representative will attend monthly Johor NUPW meeting on every 11

th of the month. The latest

meeting was discussed on the minimum wages and safety.

Meetings are held as and when there is a need. Ulu Remis Palm Oil Mill has submitted a letter to the management for a meeting. Based on records, the meetings held since last surveillance audit for visited estates and mill are as follows:

Estate/Mill Date Attendance

Bukit Badak

25 Mar 12 3 members

20 Mar 12 3 members

22 Mar 12 2 members

21 Mar 12 4 members

Pekan Ropel 9 Mar12 8 members

Ulu Remis POM 7 Mar 2013 To be conducted

Observation 09

The NUPW meeting minutes for Pekan Ropel and Ulu Remis mill have not been completely documented as the record show only 1 meeting conducted for year 2012.

6.6.2 A published statement in local languages recognizing freedom of association Minor


Objective evidence:

The company public Social Policy (Bahasa Malaysia and English) dated April 2011 clearly stated that the workers are free to join trade union of their choice and to bargain collectively. Both local and foreign workers are allowed to join the union.

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.

6.7.1 Documented evidence that minimum age requirement is met Major


Objective evidence:

The estate and mill keeps the employment record of each worker. The records evidence that there is no underage worker (below 18 years old) employed.

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.

6.8.1 A publicly available equal opportunities policy Major


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Objective evidence:

Social Policy stating that the company provides an equal opportunity for all is maintained. The policy is available and pasted on the notice board for public viewing at the entrance of the oil mill. There were no evidences of any form of discrimination based on race, national origin, religion, gender, union and political affiliation and is covered in the policy as well.

Interview with workers (including foreign workers) indicates that there is no such discrimination occurs in the workplace.

6.8.2 Evidence that employees and groups including migrant workers have not been discriminated against

Minor


Objective evidence:

There is no evidence or documentary which points to discrimination against foreign workers. Equal opportunities are demonstrated through examples such as similar daily wages for migrant workers and local workers. For workers, whether a local, Indian, Indonesian or Bangladeshi, they are not discriminated in terms of work, housing and pay.

Ulu Remis POM hires Indonesians, Malays and Bangladeshi as their workers with total number of 139 workers. For a specific operation, the pay is the same regardless of the workers origin.

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.

6.9.1 A policy on sexual harassment and violence and records of implementation Major


Objective evidence:

There is a Social Policy available for the prevention of sexual harassment and all other forms of violence against women and to protect their reproductive rights.

In Bukit Badak estate, Nora Zurihasni (Clerk) was nominated in 2010 to represent the Gender Committee. There are 12 members in the committee and about 50 women (including children) in the estate. The latest meeting was conducted on 6 Apr 2012 with a talk on Breast Cancer. They have a file to document the meetings minutes and programmes that concern women. There is no issue yet raised since her appointment.

In Pekan Ropel estate, Norhafiza Kusin has been appointed as the Gender Comittee. Records of meetings for 2012 are available and there are two meetings conducted, 10 Sep 12 and 2 Jan 12.

In Ulu Remis POM, Anida Hassan was appointed as the Gender Chairman.

6.9.2 A specific grievance mechanism is established Minor


Objective evidence:

Statement on preventing sexual harassment is described in the Gender Policy. Grievance mechanism is in place that is state within the procedures for handling complaints and grievances. The document details the procedures and mechanism applied to resolve all disputes and grievances raised by the relevant stakeholders. The statement of avoidance on sexual harassment are clearly described in the policy and made publicly available.

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

6.10.1 Pricing mechanisms for FFB and inputs/services shall be documented Major


Objective evidence:

No pricing mechanisms for FFB and inputs/services shall be documented as the supplies are from their own supply base within the same management group.

6.10.2 Current and past prices paid for FFB shall be publicly available Minor


Objective evidence:

Ulu Remis POM is not sourcing any FFB from outside suppliers including smallholders.

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6.10.3 Evidence that all parties understand the contractual agreements they enter into and that contracts are fair, legal and transparent

Minor


Objective evidence:


6.10.4 Agreed payments shall be made in a timely manner Minor


Objective evidence:


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

6.11.1 Demonstrable contributions to local development that are based on the results of consultation with local communities

Minor


Objective evidence:

Contribution to local community is an active exercise for SOU 23 and records of contribution such as road upgrading, transport for water supply during drought season, school sport activities and security issues concerning workers are available at each estate. All activities and contribution rendered are recorded in the Corporate Social Responsibility Report for each of the financial year. Among the activities held by SOU 23 are:

a) Netball

b) Programme Handicraft for women ( since 2010 )

c) Aerobic exercise

d) Improved road

e) Field

f) Transport to school for school going children

g) Religious worship places – mosque, temples

Principle 7: Responsible Development of New Plantings

This whole Principle is not applicable to this assessment as there are no new plantings. The company is only involved in re-planting programme after felling of old palms and there is no plan for expansion.

Principle 8: Commitment to Continuous Improvement in Key Areas of Activity

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

8.1.1 Minimize use of certain pesticides (C 4.6) Major


Objective evidence:

The estate monitors the use of all pesticide in their costing book which is later recorded in the Estate management IT system (SAP). Additionally, pesticide use is also monitored as per Criterion 4.6.

8.1.2 Environmental impacts (C 5.1) Major


Objective evidence:

The mill and estates reviewed the environmental aspect and impact based on different activity yearly. Each activity will be rated according different impact such as land contamination or water pollution.

8.1.3 Maximizing recycling and minimizing waste or by-products generation Major

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Objective evidence:

Biomass production such as fibre, shell and empty fruit bunch is available in Ulu Remis POM. Most of the fibre and shell will be used for the renewable energy generation-steam turbine for the CPO production while the EFB will send to their own estate used for mulching and compost.

8.1.4 Pollution prevention plans (C 5.6) Major


Objective evidence:

Pollution prevention plan is available and been reviewed annually for the mill and both estates. Inspection on site show that the suggested action plan for the environmental issue have been carried out, such as the fabrication of boiler ash containment wall to avoid boiler ash mixed with rain water. Ulu Remis POM has maintained the CEMS smoke stack monitoring. Stack sampling is done every 6 months and ambient air is sampled every 3 month.

8.1.5 Social impacts (C 6.1) Major


Objective evidence:

The estates are regularly having communication with their internal and external stakeholders through their regular meetings. Additionally, they have also documented meetings for the Gender committee, NUPW Union as well as the Joint consultative committee meeting that includes the Safety and Health meetings.

8.1.6 A mechanism to capture the performance and expenditure in social and environmental aspects

Minor


Objective evidence:

Before their yearly budget, meetings will be held among the staff and representatives to raised issues that need to be considered in the next financial year. The estate management will compiled these estimates and present to the Group General manager for their approval. For Pekan Ropel estate, the amount allocated for Social & Environment LD 07 (FY2012/2013) is RM 97,192.81.

4.1.2 Supply Chain

For supply chain, Ulu Remis Palm Oil Mill has decided to use Module D (Segregation) in this

assessment. The findings and objective evidence find during the assessment are outlined in the table

below. The results for each indicator from each of the operational areas were evaluated to provide an

assessment of conformity. A statement is provided for each of the RSPO indicators in order to

support the findings of the assessment team. As to date, there is no any transaction for RSPO

certified product yet for Ulu Remis palm Oil Mill.

Module D: Segregation

Module D.1: Documented Procedures

Criterion D.1.1: The facility shall have written procedures and/or work instructions to ensure the implementation of all the elements specified in these requirements.

D.1.1.1 Complete and up to date procedures covering the implementation of all the elements in these requirements

Findings In compliance: Yes: No:

Objective evidence:

Ulu Remis has documented the up to date procedures- Standard Operating Procedures (SOP) for Traceability and RSPO Supply Chain Certification System dated 1 August 2012.

D.1.1.2 The name of the person having overall responsibility for and authority over the implementation of

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these requirements and compliance with all applicable requirements

Verifiers and guidance:

This person shall be able to demonstrate awareness of the facilities procedures for the implementation of this standard.


Objective evidence:

Non Conformance 01

There is no appointed person for having overall responsibility for and authority over these requirements and compliance with all applicable requirements.

Criterion D.1.2: The facility shall have documented procedures for receiving and processing certified and non-certified FFBs.


Objective evidence:

The mill Weighbridge SOP and the Outside Crop Procedures ensure the receiving and processing certified and non-certified FFBs.

Module D.2: Purchasing and Goods In

Criterion D.2.1: The facility shall verify and document the volumes of certified and non-certified FFBs received.


Objective evidence:

The mill records all volumes of certified FFB received. Ulu Remis POM receives FFB from its own supplying estates which already being certified.

Criterion D.2.2: The facility shall inform the CB immediately if there is a projected overproduction.


Objective evidence:

There is no overproduction as they have the internal monitoring and reporting mechanism in place.

Module D.3: Record Keeping

Criterion D.3.1: The facility shall maintain accurate, complete, up-to-date and accessible records and reports covering all aspects of these requirements.


Objective evidence:

Inspection the report, such as monthly crop report is up to February 2013.

Criterion D.3.2: Retention times for all records and reports shall be at least five (5) years.


Objective evidence:

All records and reports are achieved and stored for 5 years as indicated in the SOP.

Criterion D.3.3: The facility shall record and balance all receipts of RSPO certified FFB and deliveries of RSPO certified CPO, PKO and palm kernel meal on a three-monthly basis.


Objective evidence:

The weighbridge ticket and delivery note record the sources and weight of all the RSPO certified FFB. Monthly crop report indicates the source of estate, FFB, PO and PK up to February 2013.

Criterion D.3.4: The following trade names should be used and specified in relevant documents (e.g. purchase and sales contracts, *product name*/SG or Segregated). The supply chain model used should be clearly indicated.


Objective Up to date, there is no any sale of RSPO certified product yet.

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evidence:

Module D.4: Sales and Good Out

Criterion D.4.1: The facility shall ensure that all sales invoices issued for RSPO certified products delivered include the following information:

a) The name and address of the buyer

b) The date on which the invoice was issued

c) A description of the product, including the applicable supply chain model (Segregated)

d) The quantity of the products delivered

e) Reference to related transport documentation


Objective evidence:

Up to the date, there is no any transaction for RSPO certified material yet. But one mock up sales contract was showed to proof that the above information has been indicated.

Module D.5: Processing

Criterion D.5.1: The facility shall assure and verify through clear procedures and record keeping that the RSPO certified palm oil is kept segregated from non-certified material including during transport and storage and be able to demonstrate that is has taken all reasonable measures to ensure that contamination is avoided. The objective is for 100% segregated material to be reached. The systems should guarantee the minimum standard of 95% segregated physical material; up to 5% contamination is allowed.


Objective evidence:

Ulu Remis POM only receives FFB from the certified estates. Other than that, they also receive FFB from other estate such as operating unit such as SOU 24 Hadapan (CEP Rengam & Layang estate) and SOU 19 (Pengkalan Bukit estate) which is already certified under RSPO P&C.

Criterion D.5.2: The facility shall provide documented proof that the RSPO certified palm oil can be traced back to only certified segregated material.


Objective evidence:

As to date, there is no transaction of RSPO segregated certified products. The weight bridge ticket and monthly crop report able to trace back to certified segregated material.

Criterion D.5.3: In cases where a mill outsource activities to an independent palm kernel crush, the crush still falls under the responsibility of the mill and does not need to separately certified. The mill has to ensure that:

a) The crush operator conforms to these requirements for segregation

b) The crush is covered through a signed and enforceable agreement


Objective evidence:

Ulu Remis mill did not have any outsources activities for palm kernel crush. They sell their palm kernel to other company such as Sang Kee Edible Oil and PGEO Oil Mill and did not buy back any Palm Kernel.

Module D.6: Training

Criterion D.6.1: The facility shall provide the training for all the staff as required to implement the requirements of the Supply Chain Certification System.


Objective evidence:

Non Conformance 02

The training to implement the requirements of the Supply Chain Certification System is not provided to the employee.

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Module D.7: Claims

Criterion D.7.1: The facility shall only make claims regarding the use of or support of RSPO certified palm oil that are in compliance with the RSPO Rules for Communication and Claims.


Objective evidence:

SOU 23 Ulu Remis POM has not made any claims yet. The RSPO Trademark License Number for Sime Darby Plantation Sdn Bhd is RSPO-1106024.

4.2 Corrective Action Request

There are total of 5 Major (3 for P&C and 2 NC for Supply Chain) and 3 Minor non conformance

were raised. Please refer to the Appendix A for the details findings and relevant correction

actions have been taken.

4.3 Noteworthy Positive & Negative Observation

For the audit, the audit teams observed some positive effort of the estate management which is

indicated as below:

a. There is no land dispute, which indicates that the land acquisition process was well

executed and is equitable.

b. The estates are committed towards minimizing usage of water and actively doing rainwater

harvesting to promote recycle water source.

4.4 Status of Non-Conformities Previously Identified

All non-conformity and CAR from previous audit is remaining in this report. Please refer to

Appendix B for the previous audit CAR logs and their status.

4.5 Issues Raised by Stakeholders and Findings

This is Annual Surveillance Audit 02; hence no stakeholder’s consultation is conducted.

However, during the audit, some of the stakeholders met were interviewed. All interviewed

stakeholders had positive comments about Sime Darby Plantation Sdn Bhd.

GP 7003A of 57

5. ACKNOWLEDGEMENT OF ORGANIZATION INTERNAL RESPONSIBILITY

5.1 Date of Next Surveillance Visit

The next surveillance audit is planned within twelve months of the date approval of this report

by RSPO.

5.2 Date of Closing Non-Conformities

Date of closing non-conformance has been specified in RSPO Certification System, June 2007. Major non-conformance raised during surveillance assessment must be addressed within 60 days, or the certificate will be suspended. Minor non-conformities will be raised to major if they are not addressed by the following surveillance assessment. Details of due date for non-conformities is attached in Appendix A.

5.3 Acknowledgement of Internal Responsibility and Formal Sign-off Assessment Findings

SGS Malaysia acknowledges and confirms acceptance of the Report contents and including

the assessment findings. SGS Malaysia accepts the responsibility for addressing the

opportunities of improvement detailed in this report.

Signed on behalf of Sime Darby Plantation Sdn Bhd

Signed on behalf of SGS Malaysia Sdn Bhd

GP 7003A of 57

APPENDIX A: CORRECTIVE ACTION REQUEST & OBSERVATIONS

CAR # Indicator CAR Detail

20 4.3.5 Date Recorded>

28th

Mar 13 Due Date> 27th

Mar 14 Date

Closed> 5

th Apr 13

Non-Conformance:

Best management practices are not in place for other fragile and problem soils.

Objective Evidence:

A revised soil identification for Pekan Ropel was lacking as it was known that the area do not have peat soil.

Close-out evidence:

Evidence of updated soil map for Pekan Ropel estate is available. However, the updated map indicates that shallow peat area is one of the soil series in the estate area. However, a letter from the R&D department for the soil verification on the relevant area already been shown to auditor. The verification will be carried out on 8 of May 2013 and further justification for the soil will be provided once the result is available. Minor CAR 20 is closed.

M21 4.4.1 Date Recorded>

28th


May 13 Date

Closed> 5

th Apr 13

Non-Conformance:

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 is not conducted.

Objective Evidence:

Areas around buffer zones in Bukit Badak Estate were found sprayed (Field 07 & Field 95)

Close-out evidence:

A letter from estate manager to all executives and staff dated 29th

Mar 2013 regarding the ‘RSPO Compliance-Protection of Buffer Zone’ is available. The letter specified that all riparian buffer zones (equal to the width of river/stream) are not to be sprayed and made free from chemicals. The estates take an action plan to maintain training records for workers relating to buffer zone protection/maintenance. Evidence of training conducted was provided. Major CAR 21 is closed


28th


Mar 14 Date

Closed>

Non-Conformance:

Evidence of water management plans is not available.

Objective Evidence:

No documented evidence of water management plan available in Bukit Badak Estate.

Close-out evidence:

Bukit Badak estate provided an evidence of water management plan is available dated August 2012. The water management plan is including identified wastewater produced and the treatment method, water contingency plan during water shortage/dry season and during serious water pollution. The estate also justifies their effort on reducing water usage by rainwater harvesting and water catchment area. Minor CAR 22 is closed.


28th


May 13 Date

Closed> 5

th Apr 13

Non-Conformance:

Pesticides not 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

Objective Evidence:

Chemical container were found not triple rinsed and pierced as required and reuse of chemical container for purposes other than containing and transporting of the identical product such as loose fruit scrapper, diesel storage, potting container and storage of other products was found.

GP 7003A of 57


Close-out evidence:

A letter from estate manager to all executives and staffs dated 29th

Mar 2013, clearly instructed that all empty chemical containers are not allowed to be used for other purposes (flower containers, diesel storage etc.). All chemical containers are to be triple rinse and pierced to avoid uncontrolled spillage and unauthorized usage. The letter also instructed that training must be provided to workers in small group and records must be maintained. Evidence of training conducted was provided. Major CAR 23 is closed


28th


May 13 Date

Closed> 5

th Apr 13

Non-Conformance:

Documented Occupational Safety and Health (OSH) Plan which is in compliance with OSH Act 1994 and Factory and Machinery Act 1967 (Act 139) is not in practice.

Objective Evidence:

a) First Aid Kit was found not available at the worksite (Chemical Store) in Bukit Badak estate. b) Workers which are not using proper PPE at the worksite are evidence such as:

Harvesting sickle without protective sheath (Linesite - Bukit Badak estate)

Manuring worker is not using proper mask (Bukit Badak estate)

CDA Sprayers are not wearing goggles during operation (F04A - Pekan Ropel estate)

FFB helpers at the unloading ramp did not use adequate hand gloves (Ulu Remis POM)

Close-out evidence:

a) First Aid Kit was found not available at the worksite (Chemical Store) in Bukit Badak estate b) Evidence of workers are using proper PPE at the worksite is available as below:

Harvesting sickle in the linesite are covered with protective sheath and stored in a safe condition.

Manuring workers are provided with adequate PPE and training records is available. Training for manuring workers has been conducted on 29

th Mar 2013 and attended with

14 workers.

CDA spraying gang has been provided with proper PPE (eye goggles) for their operation. A record of training has been conducted for them on 29

th Mar 2013 and attended by 10

workers including mandores.

Evidence of workers at unloading ramp (Ulu Remis POM) using appropriate gloves on handling the FFB is available. The workers have been provided with rubber gloves to protect their hands from the thorns.

A letter concerning adherence of PPE usage and sickle protective sheath from the estate manager to all executive and staff is circulated on 29

th Mar 2013.

Major CAR 24 is closed


28th


Mar 14 Date

Closed> 5

th Apr 13

Non-Conformance:

Waste and pollutants identified an operational plan should be developed but not implemented to avoid or reduce pollution

Objective Evidence:

a) In Badak estate, oil drums were found in the scrap yard without proper containment. Oil stain and spillage were observed around the oil drum near the line sites.

b) At the schedule waste storage area, chemical container were found not triple rinse and punched.

c) Pesticide containers were observed in the landfill for disposal of Pekan Ropel estate domestic waste.

Close-out evidence:

a) Oil drums found during the audit has been cleared and stored in the identified storage area. Oil stain and spillage on the ground are removed and refill with new cleaned sand..

b) Training on triple rinse has been conducted on 29th Mar 2013 for the spraying gang. The

training is attended by 10 workers including mandore. The rinsed container is being pierced to avoid uncontrolled usage and stored in Schedule Waste store.

c) Pekan Ropel estate has conducted waste segregation before disposal in the landfill as found in the recycle bin practiced. Evidence of the landfill being cleared from scheduled waste (empty container and paint can) is submitted and verified by the estate management. The waste of Styrofoam disposed indiscriminately in the field found during the audit has been cleared up.

Minor CAR 25 is closed.

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NC01 D.1.1.2 Date Recorded>

28th


May 13 Date

Closed> 5

th Apr 13

Non-Conformance:

The name of the person having overall responsibility for and authority over the implementation of these requirements and compliance with all applicable requirements is not available.

Objective Evidence:

There is no appointed person for having overall responsibility for and authority over the implementation of these requirements and compliance with all applicable requirements.

Close-out evidence:

Azrin Bin Mohd Nor has been appointed as the management representative for the RSPO SC as stated in the appointment letter dated 1

st of April 2013.

Major NC 01 is closed

NC02 D.6.1 Date Recorded>

28th


May 13 Date

Closed>

Non-Conformance:

The facility did not provide the training for all the staff as required to implement the requirements of the Supply Chain Certification System.

Objective Evidence:

The training for the implementation of SCCS has not been provided to the employee.

Close-out evidence:

Training has been provided to the employee on 28 March 2013 with the attendance record. Major NC 02 is closed

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OBSERVATIONS

OBS # Indicator Observation Detail

01 2.1.3 Date

Recorded> 28

th Mar 13 Due Date>

Next

Surveillance

Date

Closed>

Non-Conformance:

A mechanism for ensuring that legal register is implemented.

Objective Evidence:

A letter from SPAN dated 13th Oct 2010 enquires the names of responsible and qualified person

to check and verify the treatment plant system were not responded.

Close-out evidence:

02 4.5.4 Date

Recorded> 28

th Mar 13 Due Date> 5

th Apr 13

Date

Closed> 5

th Apr 13

Non-Conformance:

No monitoring of pesticide usage units per hectare or per ton crop.

Objective Evidence:

No monitoring of pesticide usage units per hectare or per ton crop available in Bukit Badak

estate.

Close-out evidence:

Evidence of pesticide monitoring in Bukit Badak estate is submitted to the auditors to close this

observation. In FY2011/2012, a total of 0.09a.i/ton FFB and 1.46a.i/ha is used in Bukit Badak

estate (including 41% Supersate, 20% Ally, 13.5% Basta, 5.5% EnvoCyper and 55%

Multiphos). Observation 02 is closed.

03 4.6.4 Date

Recorded> 28


th Apr 13

Date

Closed> 5

th Apr 13

Non-Conformance:

Not all information regarding the chemicals and its usage, hazards, trade and generic names

available in language understood by workers or explained carefully to them by a plantation

management official at operating unit level.

Objective Evidence:

MSDS for the herbicide (Floxil) was lacking in Pekan Estate although the a.i is similar to Kenlon

and Triclopyr butoxy.

Close-out evidence:

A copy of MSDS for Foxil is made available for the auditors. Observation 03 is closed.

04 4.6.5 Date

Recorded> 28


th Apr 13

Date

Closed> 5

th Apr 13

Non-Conformance:

Annual medical surveillance as per CHRA for plantation pesticide operators is not available.

Objective Evidence:

Records of 2012 annual medical surveillance as per CHRA for Misnah (Spray Mandore) and

Azri (Sprayer) are missing.

Close-out evidence:

A letter from Klinik Renggam stated that sprayers are being checked for medical surveillance on

2nd

Apr 2013. The medical surveillance include:

Misnah Othman (Sprayer Mandore)

Azri (Sprayer)

Abidin (Water treatment)

Ahmad Zuhdi (Sprayer)

Observation 04 is closed.

05 4.7.2 Date

Recorded> 28


th Apr 13

Date

Closed> 5

th Apr 13

Non-Conformance:

GP 7003A of 57

OBS # Indicator Observation Detail

Records of all accidents are kept but not periodically reviewed.

Objective Evidence:

Procedure for identification of Hazard, Risk Assessment and Risk Control dated November

2008 is made available but found not updated since 2008 in Bukit Badak estate.

Close-out evidence:

Bukit Badak estate has submitted an updated HIRARC which being revised on February 2013.

Updated HIRARC were verified by estate manager and cover all operational activities.


06 6.1.1 Date

Recorded> 28


th Apr 13

Date

Closed> 5

th Apr 13

Non-Conformance:

A documented social impact assessment including records of meetings is not available.

Objective Evidence:

The baseline Social Impact Assessment (SIA), Johor Zone SOU 23 copy for Bukit Badak estate

was not available.

Close-out evidence:

The baseline Social Impact Assessment (SIA), Johor Zone SOU 23 copy for Bukit Badak estate

is available dated December 2008.


07 6.1.2 Date

Recorded> 28

th Mar 13 Due Date>

Next

Surveillance

Date

Closed>

Non-Conformance:

Inadequate evidence that the assessment has been done with the participation of affected

parties.

Objective Evidence:

Evidence of participation of Pekan Ropel stakeholders was lacking in the SIA assessment

conducted in 2008.

Close-out evidence:

08 6.2.3 Date

Recorded> 28


th Apr 13

Date

Closed> 5

th Apr 13

Non-Conformance:

List of stakeholders is not maintained, records of all communication and records of actions

taken in response to input from stakeholders.

Objective Evidence:

No documented evidence of issue being resolved or closed for smallholder enquiring on the

time the gate will be locked. List of stakeholder in Bukit Badak is not updated.

Close-out evidence:

A letter from Bukit Badak estate manager dated 29th

Mar 2013 is evidence as the list of their

stakeholder dated March 2012 is still valid and will be updated if necessary. An attendance list

of meeting with stakeholder dated 10th

Apr 2013 is evidence.


09 6.6.1 Date

Recorded> 28

th Mar 13 Due Date>

Next

Surveillance

Date

Closed>

Non-Conformance:

No documented minutes of meetings with main trade unions or workers representatives.

Objective Evidence:

The NUPW meeting minutes for Pekan Ropel and Ulu Remis POM have not been completely

documented as the record show only 1 meeting conducted for year 2012.

Close-out evidence:

GP 7003A of 57

APPENDIX B: NON-CONFORMITIES PREVIOUSLY IDENTIFIED



15 Jan 09 Due Date> 26th

Mar 13 Date

Closed> 26

th Mar 13

Non-Conformance:

Absence of information on relevant international conventions, treaties etc ratified by Malaysian government that may

Objective Evidence:

Register of laws, legislation and regulation is in place but does not include international conventions, treaties etc.

Close-out evidence:

Bukit Badak and Pekan estate has compiled a list of Legal and Other Requirements Register (LORR). The list was compiled in QSHE/04/5.2.4 folder. Latest update for Pekan estate was on 9 July 2012 and approved by Mr. Abdul Malik Yasin. The list covers legal requirements such as:

j) Environment

k) Safety and Health

l) Fire Services

m) Factories and Machinery

n) Housing and Amenities

o) Labour

p) EPF

q) SOCSO

r) Union

The mill and estates has renewed permits required by the law. Amongst the licences or permit viewed were :

f) MPOB license: 544448004000 ( 30/11/2013) for 288,000MT

g) DOE Licence: 001575 (30/6/2013) for 60 MT/hr and land application (atas tanah)

h) Calibration (weighbridge) B585304 Avery L200 – 40MT (recently calibrated 25/3/13)

i) Calibration (weighbridge) B797231 Avery 1110 – 60MT (last calibrated 4/12/12)

j) Licences for Mechmar and Empire Boilers, De-aerator, back pressure Receiver steam separator, air receiver and etc. were also viewed and found to be valid.

Mill has a file “QSHE/04/5.2.4 Legal and other requirement Register” updated on 6th March 2013

by QA Supervisor; Mr. P. Seharan and contains OSH, Environmental, General legal references.



15 Jan 09 Due Date> Ist

surveillance

Date Closed>

10th

May 2012

Non-Conformance:

Lack of records of monitoring on implementation of the procedures.

Objective Evidence:

Standard operation procedures for each operation activity are documented and copies are available in the mill and estates but there is record of implementation and effectiveness of the procedures.

Close-out evidence:

In Ulu Remis Estate: Records of ‘Work place inspection ‘records to monitor work done available from 28/2/2012 – 1/1/09. The Unit uses this to monitor the effectiveness of the SOP and its safety. Minor CAR 02 is Closed



Mar 13 Date

Closed> 26

th Mar 13

Non-Conformance:

No soil samplings are carried out in any of the estate.

Objective Evidence:

GP 7003A of 57


Leaf sampling is carried out by Sime Darby Research Centre resulted in the recommendation for fertiliser application but no soil sampling have been carried out. As in the main audit, soil sampling is still not practiced to monitor soil fertility.

Close-out evidence:

Latest soil sampling conducted in Bukit Badak Estate is on 19 April 2010. The report was generated on 29 October 2010 by Sime Darby Research Sdn Bhd.

Minor CAR 03 is closed


15 Jan 09 Due Date> 10 May 2012

Date Closed>

10 May 2012

Non-Conformance:

Inadequate rehabilitation programme for abandoned areas (e.g in TDI) that is not going to be planted.

Objective Evidence:

Areas above 25 degrees have been determined through contour/slope map but need to be confirmed using GIS system. The predetermined areas are now left abandoned eventhough yet to be ground truth and demarcated.

Close-out evidence:

In TDI – rehabilitation programme along the buffer zone as well as areas with slopes > 25°was evidence during field visit (Minor CAR 04 – Closed)


15 Jan 09 Due Date> 10 May 2012

Date Closed>

10 May 2012

Non-Conformance:

Lack of identification of fragile and problem soil and no specific programme for soil conservation.

Objective Evidence:

The company has soil, contour etc map for each estate but no effort has been made to systematically identify sensitive and problem areas despite obvious sign such as erosion and siltation in the stream.

Close-out evidence:

Sime Darby has a Slope & River Protection policy that emphasises protection of slopes and rivers (April 2011). Although during the audit, streams were found to be silted, there were evidence of the estate making efforts to minimised the impacts. It was reported that investigation revealed that the silt comes from the neighbouring smallholders/estates which do not belong to SOU 23. (Minor CAR 05 – Closed)


15 Jan 09 Due Date> Refer to

M21

Date Closed>

Non-Conformance:

Inconsistent implementation of procedure on identification and protection of riparian buffer zone.

Objective Evidence:

Bufferzone has been identified on the map and on the ground. Observed that the buffer area is marked with blue paint and at least one row of palm (depending on the size of stream involved) is spared where no pesticides and fertiliser application will be carried in such area. However, the procedure is not implemented in all estates. In Cenas, the buffer zone not marked consistently resulting in spraying within buffer zone 01B, 97A (waterfall). Similarly in Ulu Remis & Sembrong - palms along the buffer zone were removed during replanting programme.

Close-out evidence:

Annual Surveillance Audit 02 evidence that buffer zone in field F07 and F95 in Bukit Badak estate is being sprayed. This has lead into new Major CAR 21.

07 5.2.1 Date

Recorded> 15 Jan 09 Due Date>

Refer to Major

CAR14

Date Closed>

Refer to Major CAR14

Non-Conformance:

The method for identification and assessment of HCV habitats has not been undertaken through adequate stakeholder consultation.

Objective Evidence:

GP 7003A of 57


The company has documented a ‘Biodiversity Baseline Assessment Report for SOU 23’ dated January 2008 that described the method and identify the possible HCV areas within the SOU. The study concludes that there are HCV 4 and HCV 6 within the unit. However the assessment was done without consultation with local experts etc.

Close-out evidence:

There was no progress made for the issue raised during the main audit concerning consultation with recognised HCV experts and relevant stakeholders with interests - no progress observed during the audit. (Minor CAR 07 & 08 combined and upgraded into Major CAR 14)

08 5.2.2 Date

Recorded> 15 Jan 09 Due Date>

Refer to Major CAR

14

Date Closed>

Refer to Major CAR14

Non-Conformance:

Biodiversity Action Management Plan is in adequate and does not include consultation with recognised HCV experts and relevant stakeholders.

Objective Evidence:

The ‘Biodiversity Baseline Assessment Report for SOU 23’ includes recommendation on the management of biodiversity area as well as a Biodiversity Action Plan that include time line for implementation however is preliminary in nature.

Close-out evidence:

The plan is preliminary in nature and requires a review for management capacity gaps, and training and support to address HCV management needs No management planning consideration given for potential HCV3 areas in swamp and aquatic areas. (Refer to Minor CAR 07 upgrade )



surveillance

Date Closed>

10 May 2012

Non-Conformance:

There are no mechanism for direct monitoring of shell and fibre used to generate energy.

Objective Evidence:

Estimate of FFB and shell produced is available. The mill used the FFB for mulching in the field and sell out some of the shell. Significant portion of the shell and fibre are used for boiler operation but no record is being maintained.

Close-out evidence:

Monitoring of Pericarp fibre (13.5%) and shell ( 5%) is done monthly and records were viewed. In April 2012, FFB processed 14114.91, Pericarp fibre: 1905.51MT, shell 776.32 MT. CPO produced: 2991.200 MT, MT renewable energy used / MT CPO= 0.9. The RE for Jul 11 – Apr 12 ranges from 0.85 – 0.92. (Minor CAR 09 - Closed)



surveillance

Date Closed>

10 May 2012

Non-Conformance:

Identification of polluting activities is inadequate and does not address the emission of GHGs.

Objective Evidence:

Plans to mitigate polluting activities in place but it does not identify activities that emit GHGs.

Close-out evidence:

Plan and Pollution Prevention Plan. Copies of the annual reviews EMP Mill Environmental Plan in the file. 2011/2012, 2010/11. (Minor Car 10 – Closed)



Mar 13 Date

Closed> 26

th Mar 13

Non-Conformance:

No evidence of periodical review of pollution and emission reduction plans.

Objective Evidence:

Pollution mitigation plan is yet to be implemented. Although the mill has the annual review, the estate plans were not annually reviewed.

Close-out evidence:

GP 7003A of 57


Plan and Pollution Prevention Plan. Copies of the annual reviews EMP Mill Environmental Plan in the file. 2011/2012, 2010/11.

For the mill, environmental management plan has been updated in the late of 2012. Action such as fabricate boiler ash containment wall and to close the monsoon drain line and divert all drain water to cooling pond has been verified on field. (Minor CAR 11-Closed)


15 Jan 09 Due Date> 1

st

surveillance

Date Closed>

10 May 2012

Non-Conformance:

The timetable tabulated in the social management plan is insufficient as it does not include indicators for monitoring as well as it is not long term.

Objective Evidence:

The social management plan that summarise the actions to be taken on periodical basis is tabulated in the Social Baseline Study but yet to be reviewed and updated.

Close-out evidence:

In Cenas Estate the Action Plan – Social management Plan 2012 was viewed. It includes a) A time table , b) PIC, c) time frame d) and status of the action

(Minor CAR 12 – Closed)


15 Jan 09 Due Date> 1

st

surveillance

Date Closed>

10 May 2012

Non-Conformance:

No mechanism to capture the performance and expenditure in social and environment aspects.

Objective Evidence:

Close-out evidence:

- Expenditure in social and environment is budgeted Minor CAR 13 – closed

M14 5.2.1,5.2.2 Date Recorded>

10th

May 2012

Due Date> 10 July 2012

Date Closed>

27 June 2012

Non-Conformance:

There was no progress made for the issue raised during the main audit concerning consultation with recognised HCV experts and relevant stakeholders with interests - no progress observed during the audit. (Major CAR 14 – Raised)

Objective Evidence:

As in Close-out evidence

Close-out evidence:

Evidence in the form of an email from Cenas Estate dated 13 Feb 2012 addressed to the Officer of State Forestry Department of Johor to enquire on the Forest Reserve known as Kluang Tambahan was submitted as progress of SOU 23 on issue raised during the main audit. A response (on the 23

rd Feb 2012) by an officer, MUHAMAD RIZAL BIN ABD. RAHIM (Pen.

Pegawai Hutan Daerah, Johor Selatan) of the Johor State Forestry was also submitted as evidence of addressing the issue. Based on these findings, that progress has been made to resolve the HCV issue, the auditing team has agreed to re-categorised the Major CAR 14 to Minor CAR 19 pending verification

during the next ( 2nd

) Annual Surveillance Audit.

15 Date Recorded>


Mar 13 Date

Closed> 26

th Mar 13

Non-Conformance:

Pesticides were not 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 and the reuse of chemical containers. Objective Evidence:

Re-use of chemical containers as a storage container were found at Cenas Estate workshop. The use of loose-fruit collecting rake was also evident. In Sembrong Estate guardhouse, one chemical container was also reuse as a storage bin. In Cenas Estate worker shower room area, a bagful of rat bait was found.

Close-out evidence:

GP 7003A of 57


Evidence in the form of email have been submitted for the auditor to ensure that all empty chemical containers has been store appropriately in schedule waste store and forbidden to reuse. All loose fruit scrapper made from chemical container collected and replaced with fruit rakes made from metal material. Evidence of workers shower room in Cenas estate clear from rat baits and any chemical is available. Minor CAR 15 is closed.


10 May 12 Due Date> 26th

Mar 13 Date

Closed> 26

th Mar 13

Non-Conformance:

Evidence of documented Occupational Safety Health (OSH) plan which is in compliance with OSH Act 1994 and Factory and Machinery Act 1967 (Act139). First Aid equipment should be available at worksites.

Objective Evidence:

In Cenas Estate: First aid kit at workshop still contained panadol pills which have since been instructed to be removed from the first aid kit. Mill workshop: unlabeled ointment found in the first aid kit In Sembrong Estate, no first aid kit found with the harvesting mandore during workhours. Inadequate spill kit in Cenas Estate chemical store, Workshop and in Palm Oil Mill Chemical store.

Close-out evidence:

a. First aid kit in Cenas estate has been checked by Hospital Assistance and made free from Panadol. All ointment in the first aid kit is labeled properly.

b. Missing first aid kit from harvesting mandore in Sembrong estate is replaced. c. Adequate spill kit in chemical store of Cenas estate is available. This evidence is

shown to the auditors by email for verification. Minor CAR 16 is closed.


10 May 12 Due Date> 26th

Mar 13 Date

Closed> 26

th Mar 13

Non-Conformance:

Having identified wastes and pollutants and an operational plan developed yet waste at landfill was still not segregated and recycled material were also found

Objective Evidence:

Badak, TDI, Sembrong & Cenas Estate: Landfill evidence that implementation of segregation and reduction of waste is lacking. Tyres, plastic, chemical containers, safety helmets, domestic waste, workshop waste. Procedure for handling domestic waste is in the Sime Darby Plantation Quality Management system (SPMS) appendix 9.

Close-out evidence:

All landfill in Bukit Badak, TDI, Sembrong & Cenas Estate has implement waste segregation. All waste identified as scheduled waste is stored in a locked chemical store and waiting for appointed schedule waste contractors to collect. Minor CAR 17 is closed.


10 May 2012

Due Date> 26th

Mar 13 Date

Closed> 26

th Mar 13

Non-Conformance:

No mechanism to capture the performance and expenditure in social and environment aspects.

Objective Evidence:

CARs and Observation raised during main evaluation were not acted upon due to management transfer and inadequate coordination between the relevant division / personnel that are responsible for the implementation and the maintenance of the compliance to the requirement of RSPO.

Close-out evidence:

Sime Darby Plantation Sdn Bhd has established PSQM unit to monitor the progress of each SOU. PSQM team will capture all CARs and Observation raised during assessment and coordinating with estate representative from time to time. There is no more issues of CARs raised during evaluation were not acted due to management transfer. PSQM team will compile all findings and keep all documentation from each SOU and to act accordingly. Minor CAR 18 is closed.

19 5.2.1 5.2.2

Date Recorded>

10 May 2012

Due Date> 26th

Mar 13 Date

Closed> 26

th Mar 13

Non-Conformance:

GP 7003A of 57


No identification and assessment of HCV habitats and protected areas within landholdings; and attempt assessments of HCV habitats and protected areas surrounding landholdings and management plan for HCV habitats (including ERTs) and their conservation involving relevant stakeholders.

Objective Evidence:

As no new evidence was shown during the first surveillance audit and no progress been made since the last correspondence in February 2012 , this non-conformity is raised and need to be verified during the next surveillance audit as evidence of SOU 23 responsibility to resolve the issue.

Close-out evidence:

SOU 23 has established Biodiversity Baseline Assessment Report for all estate including Cenas. An evidence of the assessment being conducted on February 2012 by Plantation Sustainability Department, Sime Darby is available for the auditor. The report has included:

a) Vegetation Status b) Wildlife c) Ecological Component d) Endangered, Rare and Threaten (ERTs) e) Decision on HCV status


GP 7003A of 57

APPENDIX C: TIMEBOUND PLAN

GP 7003A of 57

GP 7003A of 57

APPENDIX D: LIST OF STAKEHOLDERS CONTACTED

1. Contractors/vendors/suppliers

Sanjev Engineering

Awan Timur Kluang

Kenanga Ikatan

Sabilah Holdings Sdn

Bhd

Sykt New Kian seng

Tan Khoon Hup

Emtech Sdn Bhd

Base Wei Industrial Supplier Sdn Bhd

Proskima Sdn Bhd

Lien Yew Hardware

Sumber Sari Sdn Bhd

Gan Tyres Batteries

Oxygen Holding Sdn Bhd

Zincon Multi Trading

Advanced Business Computing

Layang Vista Sdn Bhd

Oceanic Chemicals &

Instruments Sdn Bhd

Malayan Parts Sdn Bhd

Nalco Industrial Services

Apex Uniparts Sdn Bhd

Sykt Central Enginering

Works Sdn Bhd

Scott & English Sdn Bhd

2. Local Community Head

UMNO Cawangan Ladang Pekan

Penghulu Layang-layang

Ketua Kampung – Kampung Paya

Ketua Kampung – Kampung Tengah

Ketua UMNO Cawangan Tun Dr Ismail

Imam Masjid Kampung Sahri

3. Authorities

4. Nongovernmental organizations

Jabatan Alam Sekitar – Kluang, Johor

Pusat Kesihatan Kecil – Layang-layang

Balai Polis Layang-layang

Jabatan Keselamatan dan Kesihatan Pekerjaan – Johor Bharu

Pertubuhan Keselamatan Sosial Negeri Johor

Lembaga Hasil Dalam Negeri Johor

Sekolah Rendah Kebangasaan Tamil Ladang TDI

Jabatan Pengairan dan Saliran Negeri Johor

WWF Malaysia Malaysian Nature Society

RSPO PRINCIPLES & CRITERIA CERTIFICATION REPORT Public … · 2014. 11. 2. · During the audit,...

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Transcript of RSPO PRINCIPLES & CRITERIA CERTIFICATION REPORT Public … · 2014. 11. 2. · During the audit,...