100810 ivex presentation - smart

8/8/2019 100810 IVEX Presentation - SMART

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10 August 2010


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1. Introduction

2. Summary of Greenpeace claims

3. Summary of findings4. Key points

5. Findings

6. Conclusion

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THE INDEPENDENT VERIFICATION TEAM

Appointed in April 2010 after consulting Unilever

CUC, BSI and assisted by Bogor Agricultural Institute expertsProf. Dr. Bambang Hero Saharjo and Dr. Ir. H. Yanto Santosa

SCOPE

To verify the claims in the Greenpeace reports:- Burning Up Borneo

- Illegal Forest Clearance and RSPO Greenwash: Case Studies ofSinar Mas

- Caught Red Handed: How Unilevers Use Of Palm Oil Is Having A

Devastating Impact On Rainforest, The Climate And Orang-Utans- New Evidence: Sinar Mas Rainforest and Peatland Destruction

- Sinar Mas Continues Rainforest Destruction

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SCOPE

To provide accurate, complete and contextual information to

assess Greenpeace claim, and identify gaps, if any To verify claims against:

Prevailing laws and regulation in Republic of Indonesia

The Indonesian national interpretation of Roundtable onSustainable Palm Oil (RSPO) principles and criteria

SMARTs standard operating procedures

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Covered 11 concession areas

182,528 ha, over 40% of GAR total planted area of 430,200 ha

Field work

Concessions

Central17 May 22 May

- PT BAP

- PT BAT

- PT LUJ- PT MKA

- PT SKU

- PT TN

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West31 May 8 Jun

- PT ALM

- PT KPC

- PT KGP- PT PGM

- PT PIP


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1. Destroying primary forests, orang-utan habitats and HCV areas

2. Clearing and planting on peat land

3. Burning forests4. Clearing land without permits

5. Causing social conflict

6. Engaging in selective RSPO membership

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1. Degradation process of primary forest areas that were habitatsfor Borneo orang-utan happened before SMART started theoperations of the concessions. All 11 concessions are on

degraded land.

2. Clearing peat land is not as extensively as claimed. 1.8% (3,210ha) of peat (>3m deep) cultivated on 182,528 ha of totalconcessions

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Could not find evidence of burning in land clearing andpreparation

4. In compliance with necessary permits, although in CentralKalimantan, the environmental impact assessment or AMDALprocess completed after Plantation Business Permit

5. Small holders and wider community perceive positive impactfrom plantations

6. GAR not RSPO member, only SMART and PT Ivo Mas Tunggalare members

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Greenpeace claims are eitherexaggerated or wrong

Not responsible fordestruction of orang-utanhabitats

Not responsible fordeforestation of primary

forests Not responsible for burning

Operates responsibly andwithin the laws

Vital player and part of thesolution

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Findings

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THE FINDINGS:

All concessions consist of degraded land

Orang-utans habitat already affected by earlier activitiessuch as logging, slash and burn economy

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OUR STAND:

We believe in protecting and conservingthe orang-utan as a vital part of Indonesiasand the worlds heritage

1,400 ha sanctuary in Central Kalimantan

Active role in the National Orang-Utan

Working Group Committed to conserve HCV


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THE FINDINGS:

Not responsible for the deforestation of primary forest

All plantations are confirmed to be degraded land

OUR STAND:

Complies with laws and regulations

Complies with principles and criteria of RSPO

Committed not to plant on primary forests, peat land andHCV area

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Deforestation of primary forest: Before SMART started operations


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Source: UNFCC Secretariat 2007

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51.5 million square hectares (28%) of Indonesias total land mass of187.8 is classified as protected forest and conserved area

NO1119.9Natural/conservation forest

NO1731.6Protected forest

Types of land and forest Hectares insquare millions

% of totalland mass

SMARTdevelopment

Forestry Area

Permanent production forest 36.7 19 NO

Convertible forest 22.8 12 NOLimited production forest 22.5 12 NO

Hunting parks 0.2 Negligible NO

Total 133.7 71

Non-Forestry Area

Plantation 19.9 11 YES

Agriculture 19.2 10 NO

Others 15.0 8 NO

Total 54.1 29

Grand total 187.8 100

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Indonesia: Land and forest classification


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Source: FAO 2009, MOA 2009

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* Including coffee, cocoa, sugar, pepper and tobacco** Including peanuts, sweet potatoes and cassava

Plantation Crops

Farm Crops

Indonesia: Agriculture and plantation land use by key crops


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Palm Oil : More sustainable

Soybean

41%

Rapeseed

13%

Sunflowersee

d

10%

Cottonseed13%

Groundnuts

9%

Coconut

4%

Castorseed

1%Sesameseed

3%Linseed

1% Palm Oil

5%

CNO

2%Soyoil

22%Rape Oil

13%

Sun Oil

8%

Others

24% CPO & PKO

31%

Palm oil uses only 5% of globaloilseed land use

Palm products supply 31% of globaledible oil

Source: Oil World Annual 2010

Data per 2009

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THE FINDINGS:

HCV is dynamic and ambiguous, with varying results

HCV assessment is a daunting task to identify and conserve HCV

Cleared 37,698 ha or 21.0% of the concession areas before HCVassessment

OUR STAND:

We will not develop HCV land

Working with stakeholders to implement the necessary remedialaction

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HCV Assessment: In transition

Strengthened standard operatingprocedures - no longer develop landwithout HCV assessments

HCV identified in 20,933 ha (11.5%)and are conserved in Central andWest Kalimantan


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THE FINDINGS:

No evidence of burning in land clearing and preparation

Hotspots likely to have been caused by slash-and-burnpractices of the local community

OUR STAND:

Absolutely against burning, established policy in 1997

Prompt action towards illegal fires

Routine fire patrols during the dry season

Regular fire fighting training for staff, dedicated fire fightingsquads

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THE FINDINGS:

Environmental Impact Assessment (EIA) or AMDAL for all 5concessions in West Kalimantan in order

In Central Kalimantan, AMDAL process completed after landclearing for all 6 concessions which is not in compliance

OUR STAND:

SMART pursues compliance

SMART obtained the in-principle business permits andproceeded to clear the land while AMDAL is being processed

SMART has subsequently obtained AMDAL for all the 6 central

Kalimantan concessions Going forward, SMART ensures that AMDAL is obtained

before land clearing as in West Kalimantan

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Land development permits : Pursuing compliance


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THE FINDINGS:

No evidence of negative relations with local landholders - includingthose that did not sell land to SMART

Evidence that the plantations improved livelihoods SMART documentation of land transaction process should be

improved

Relations with indigenous people were not addressed

OUR STAND: We believe in treating local landowners and communities fairly

Many local landowners become small holders working inpartnership with the plantation

We estimate that their income can range between US$9 andUS$12 per day

We provide 129 schools for 21,800 students and 2,455 universityscholarships (including through the Eka Tjipta Foundation)

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THE FINDINGS:

SMART and PT Ivo Mas Tunggal are members

They are in the process of RSPO certification

OUR STAND:

To obtain RSPO certification for all of GARs existing palm oiloperating units by 2015

GAR to become RSPO member

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Greenpeace claims areeither exaggerated or

wrong Not responsible for

destruction of orang-utanhabitats

Not responsible fordeforestation of primaryforests

Not responsible for burning

Operates responsibly and

within the laws Vital player and part of the

solution

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