· kekayaan pom kekayaan paloh, johor 4.436 2011 certified landak paloh, johor 4.451 2011...

PT. MUTUAGUNG

LESTARI

ASSESSMENT REPORT

Roundtable on Sustainable Palm Oil Certification

[ ]Stage-1 [ ] Stage-2 [√] Surveillance [ ] Re-Assessment

Plantation Management/Owner : KUALA LUMPUR KEPONG Bhd

Plantation Name : Tapung Kanan POM, PT SEKARBUMI ALAMLESTARI

Location :

Kota Garo Village, Tapung Hilir Sub District,

Kampar District, Province of Riau, Indonesia

Certificate Code : MUTU-RSPO/025

Date of certificate issue : 24 April 2013

Date of expiry of certificate : 23 April 2018

Assessment Assessment

Date PT. Mutuagung Lestari

Auditor Review

by Approved

by

ST-1 13 – 15 November 2012 Octo HP Nainggolan (Lead Auditor),

Marsudi Eko Santoso Taufik

Margani Tony

Arifiarachman

ST-2 17 – 21 December 2012

Octo HP Nainggolan (Lead Auditor), Marsudi Eko Santoso,

Ardiansyah,Bukti Bagja

S-1 24 – 28 February 2014

Oktovianus Rusmin (Lead Auditor), Marsudi Eko Santoso (Auditor), Trismadi Nurbayuto

(Auditor), Steve Mualim (Auditor), Muhammad Rinaldi (Observer)

Taufik Margani

Tony Arifiarachman

Mutuagung Lestari • Raya Bogor Km 33,5 Number 19 • Cimanggis • Depok 16953• Indonesia

Telephone (+62) (21) 8740202 • Fax (+62) (21) 87740745/6

Email : [email protected] ● www.mutucertification.com

MUTU Certification • Approved by RSPO Secretariat on June 2008

Submitted to RSPO on:

Approved by RSPO on:

Approved by Certification Body on:

6 May 2014

1 May 2014

http://www.mutucertification.com/

PT. MUTUAGUNG

LESTARI

ASSESSMENT REPORT

SPO – 4006a.5 ii Prepared by Mutuagung Lestari for Tapung Kanan POM (PT Sekarbumi Alamlestari) –Kuala Lumpur Kepong Bhd

TABLE OF CONTENT

FIGURE

Figure 1. Location Map Figure 2. Operational Map

1 2

1.0 SCOPE of the SURVEILLANCE ASSESSMENT

1.1 National Interpretation Used 3

1.2 Organization Information 3

1.3 Type of Assessment 3

1.4 Location of Plantations, Mill and Area Statement 3

1.5 Description of Supply Base 4

1.6 Dates of Plantings and Cycles 5

1.7 Tonnage Certified 5

1.8 Other Certifications 6

1.9 Time-Bound Plan for Other Management Units 6

2.0 ASSESSMENT PROCESS

2.1 Certification Body 9

2.2 Assessment Team 9

2.3 Assessment Methodology, Assessment Process and Locations of Assessment 10

2.4 Stakeholder Consultation and List of Stakeholders Contacted 13

2.5 Date of Next Surveillance Visit 13

3.0 ASSESSMENT FINDINGS

3.1 3.2

Summary of Assessment Report of the RSPO Certification Summary of Assessment Report of Supply Chain Requirement

14 41

3.3 Conformity Checklist of Certificate and Logo Use 45

3.4 Summary of RSPO Partial Certification 46

3.5 Identification of Findings, Corrective Actions, Observations, Opportunity for Improvement and Noteworthy Positive Components

47

3.6 Summary of Arising Issues from Public, Management and Auditor Responses 60

4.0 CERTIFIED ORGANIZATION’S ACKNOWLEDGEMENT OF INTERNAL RESPONSIBILITY

4.1 Formal Signing of Assessment Findings 64

APPENDICES

1. List of Stakeholders Contacted in the Survaillance-1 Process 65

2. Assessment Program 66

3. Glossary 69

PT MUTUAGUNG LESTARI

ASSESSMENT REPORT

SPO – 4006a.5 1 Prepared by Mutuagung Lestari for Tapung Kanan POM (PT Sekarbumi Alamlestari) –Kuala Lumpur Kepong Bhd

Figure 1. Location Map of PT Sekarbumi Alamlestari

Kampar


ASSESSMENT REPORT


Figure 2. Operational Map of PT Sekarbumi Alamlestari


ASSESSMENT REPORT


1.0 SCOPE OF THE CERTIFICATION ASSESSMENT

1.1 National Interpretation Used National Interpretation, RSPO Principles and Criteria (P&C) for Sustainable Palm Oil

Production, Republic of Indonesia - RSPO INA-NIWG, May 2008 and RSPO Supply Chain

Certification Standard Modul E (Mass Balance) November 2011.

1.2 Organization Information

1.2.1 Company name Kuala Lumpur Kepong Sdn. Berhad – Tapung Kanan POM (PT Sekarbumi Alamlestari)

1.2.2 Contact person Tan Kei Yoong

1.2.3 Company address and site address RSPO registered company: Wisma Taiko, 1, Jalan S. P. Seenivasagam, 30000

Ipoh, Perak, Malaysia

Site: Kompleks Pertokoan Taman Anggrek Blok B2 – B5

Jl. Tuanku Tambusai, Pekanbaru, Riau

1.2.4 Telephone 0761 – 571885, 571861/62

1.2.5 Fax 0761 – 571884

1.2.6 E-mail [email protected]

1.2.7 Web page address www.klk.co.id

1.2.8 Company status Private

1.2.9 Management Representative who completed the application for certification

Tan Kei Yoong

1.2.10 Registered as RSPO member 8 October 2004 Registration number: 1-0014-04-000-00

1.3 Type of Assessment

1.3.1 Scope of Assessment Palm Oil Mill and supply base

1.3.2 Type of certificate Single

1.3.3 Company names listed in the certificate

PT Sekarbumi Alamlestari – Kuala Lumpur Kepong Sdn. Berhad

1.3.4 Number of management unit 1 (one) Palm Oil Mill and 3 (three) Estates: Tapung Kanan POM, Tapung Kanan 01 Estate, Tapung Kanan 02 Estate and Tapung Kanan 03 Estate

1.4 Locations of Mill, Plantations and Area Statement

1.4.1 Location of Mill

Name of Mill Location

GPS

Latitude Longitude

Tapung Kanan POM Village of Kota Garo, Sub district of

Tapung Hilir, District of Kampar,

Province of Riau

0° 45' 26"

N

101° 13' 11"

E

http://www.klk.co.id/

PT. MUTUAGUNG LESTARI

ASSESSMENT REPORT

SPO – 4006a.5 Page 4 Prepared by Mutuagung Lestari for Tapung Kanan POM (PT Sekarbumi Alamlestari) –Kuala Lumpur Kepong Bhd

1.4.2 Location of Supply Base

Name of Supply Base Location

GPS Latitude Longitude

TAPUNG KANAN 1 Village of Kota Garo, Sub district of


Province of Riau

0° 47' 31"

N

101° 10' 44"

E



Province of Riau

0° 46' 53"

N

101° 10' 9"

E



Province of Riau

0° 42' 56"

N

101° 15' 0"

E

1.4.3 Tenure

Private

State 6,200 Ha

Community

1.4.7 Area Statement

Total area 6,200 Ha

Mature area 5,178 Ha

Immature area - Ha

Mill 20 Ha

Infrastructure 50 Ha

Swamp (include HCV) 885 Ha

Others area 10 Ha

Riparian River (include HCV) 57 Ha

1.5 Description of Supply Base

1.5.1 Description of Mill

Name of Mill Capacity

(tonnes/ hour)

FFB Processed

(tonnes/ year)

CPO Palm Kernel PKO

Out put (tonnes)

Extraction (%)

Out put (tonnes)

Extraction (%)

Out put (tonnes)

Extraction (%)

Tapung Kanan POM

30 134,150.50 28,101 20.95 7,057 5.26 - -

* Production data on February 2013– January 2014

1.5.2 Description of Estate(s)

Name of Estate(s) Total Area

(Ha)

Planted Area (Ha)

FFB (tonnes/year)

Yield (tonnes/ha/year)

Supplied to Mill

FFB (tonnes/year)

%

TAPUNG KANAN 1 2,445 1,977 42,406 21.45 39,875.61 29.72

TAPUNG KANAN 2 1,888 1,665 43,718 26.25 42,662.79 31.80

TAPUNG KANAN 3 1,867 1,536 37,280 24.27 35,394.82 26.38

Total 6,200 5,178 123,404 23.83 117,933.22 87.91

* Production data on February 2013 – January 2014. Tapung Kanan Estate 1, Tapung Kanan Estate 2 and Tapung Kanan Estate 3 is supplied FFB to Mandau POM (Kuala Lumpur Kepong Sdn. Berhad)


ASSESSMENT REPORT


1.5.3 Smallholder(s) and other source

Name of source(s)

Member(s) Location Total Area

(Ha) FFB

(tonnes/year)

Supplied to Mill

FFB (tonnes/year)

%

KKPA

PT Sekarbumi Alamlestari

Scheme Smalholder

Sub district of Tapung Hilir,

District of Kampar, Province

of Riau 1,050 16,217 16,217 12.09

Total 16,217 16,217 12.09

*Source Production Data on February 2013 – January 2014

1.5.4 Product categories FFB/CPO/PK

1.6 Dates of Plantings and Cycles

1.6.1 Age profile of planted palms*

Planting Year

Hectarage

Name of Estate (Ha)

Name of Estate (Ha)

Name of Estate (Ha)

Total (Ha)

1992 144 358 - 502

1993 663 478 85 1,226

1994 367 539 549 1,455

1995 194 223 350 767

1996 249 - - 249

1997 - - 146 146

1998 38 - 174 212

1999 201 - 164 365

2001 14 - 51 65

2005 15 67 7 89

2006 38 - 10 48

2010 54 - - 54

Total 1,977 1,665 1,536 5,178

1.6.2 New Planting area after November 2005 102 Ha

1.6.3 Planting Cycle 1st 25 Years

1.7 Approximate Tonnage Certified

1.7.1 Past Annual Claim Certified Product

FFB Production 130,674 Tonnes/year

CPO Production 28,186 Tonnes/year

Palm Kernel (PK) Production 7,187 Tonnes/year

Palm Kernel Oil (PKO) Production - Tonnes/year

1.7.2 Claim Certified Tonnage of FFB

Name of Estate(s) Total Area

(Ha) Planted Area

(Ha) FFB

(tonnes/year) Yield

(tonnes/ha/year)


ASSESSMENT REPORT


TAPUNG KANAN 1 2,445 1,977 42,406 21.45

TAPUNG KANAN 2 1,888 1,665 43,718 26.25

TAPUNG KANAN 3 1,867 1,536 37,280 24.27

Total 6,200 5,178 123,404 23.83

1.7.3 Claim Certified Tonnage of Palm Product

Name of Mill Capacity

(tonnes/ hour)

FFB Processed

(tonnes/ year)

CPO Palm Kernel PKO

Out put (tonnes)

Extraction (%)

Out put (tonnes)

Extraction (%)

Out put (tonnes)

Extraction (%)

PKS Tapung Kanan

30 123,404 25,853 20.95 6,491.05 5.26 - -

1.8 Other Certifications

1.8.1 ISO 9001:2008/ISO 14001: 2004 -

1.8.2 OHSAS 18001:2007 -

1.8.3 HACCP -

1.8.4 Others RSPO Certified by PT. Mutu Agung Lestari (No. MUTU-RSPO/025) at April 25th, 2013 and applies to 23 April 2018.

1.9 Time Bound Plan for Other Management Units

MANAGEMENT UNIT LOCATION

Coverage Area (Ha)

Time Bound

Status

P O M Estate (Supply Base)

INDONESIA

Berau POM

Malindomas Perkebunan

Berau, Kalimantan Timur 7.971 2014

Hutan Hijau Mas Berau, Kalimantan Timur 7.288 2014

Jabontara Eka Karsa Berau, Kalimantan Timur 14,086 2014

Karya Makmur Abadi Mentaya Hulu, Kalimantan Tengah

13.127 2015

Menteng Jaya Sawit Perdana

Mentaya Hilir Utara, Kalimantan Tengah

6.399 2015

Mulia Agro Permai Baamang, Kalimantan Tengah 9.056 2015

Steelindo Wahana Perkasa POM

Steelindo Wahana Perkasa

Belitung, Bangka Belitung 14.065 2012 Audited 2013

Parit Sembada POM

Parit Sembada Belitung, Bangka Belitung 3.990 2013

Alam Karya Sejahtera Belitung, Bangka Belitung 6.012 2013

Mandau POM Mandau Bengkalis, Riau 14.799 2012 Certified

Nilo POM Nilo Pelalawan, Riau 12.860 2012 Audited 2013

Tapung Kanan POM

Sekarbumi Alamlestari Kampar, Riau 6.200 2012 Certified

Mutiara Kampar, Riau 1.800 2014

Gohor Lama Basilam Langkat, Sumatera Utara 2.337 2014


ASSESSMENT REPORT


POM Gohor Lama Langkat, Sumatera Utara 3.307 2014

Tanjung Beringin Langkat, Sumatera Utara 4.157 2014

Maryke Langkat, Sumatera Utara 2.827 2014

Bekiun Langkat, Sumatera Utara 2.979 2014

Padang Brahrang POM

Padang Brahrang Langkat, Sumatera Utara 2.024 2014

Bukit Lawang Langkat, Sumatera Utara 1.482 2014

Tanjung Keliling Langkat, Sumatera Utara 2.360 2014

PENINSULAR MALAYSIA

Batu Lintang POM

Pelam Kulim, Kedah 2.526 2013 Audited March 2013

Batu Lintang Serdang, Kedah 2.355 2013 Audited March 2013

Subur Batu Kurau, Perak 1.290 2013 Audited March 2013

Ghim Khoon Kulim, Kedah 434 2013 Audited March 2013

Kekayaan POM

Kekayaan Paloh, Johor 4.436 2011 Certified

Landak Paloh, Johor 4.451 2011 Certified

Voules Tenang, johor 2.977 2011 Certified

Bandar Tenggara Bandar Tenggara, Johor 950 2011 Certified

New Pogoh Tenang, johor 1.560 2011 Certified

Fraser Kulai, Johor 2.932 2011 Certified

Paloh Paloh, Johor 2.029 2011 Certified

Sungai Bekok Bekok, Johor 636 2011 Certified

Ban Heng Pagoh, Muar, Johor 631 2011 Certified

See Sun Renggam, Johor 589 2011 Certified

Paloh POM Paloh, Johor Outside Crop

Jerang Padam POM

Ayer Hitam Bahau, Negri Sembilan 2.640 2012 Certified

Batang Jelai Rompin, Negri Sembilan 2.162 2012 Certified

Jeram Padang Bahau, Negri Sembilan 2.114 2012 Certified

Kombok Rantau, Negri Sembilan 1.915 2012 Certified

Ulu Pedas Pedas, Negri Sembilan 923 2012 Certified

Gunung Pertanian Simpang Durian, Negri Sembilan 686 2012 Certified

Sungai Kawang Lanchang, Pahang 1.889 2012 Certified

Renjok Telemong, Pahang 1.578 2012 Certified

Tuan Telemong, Pahang 1.353 2012 Certified

Tanjung Malim POM

Tanjung Malim Tanjung Malim, Perak 1.544 2013 Audited June 2013

Kerling Kerling, Selangor 619 2013 Audited June 2013

Sungai Gapi Serendah, Selangor 603 2013 Audited June 2013

Bukit Kato Audited June 2013

Kampar Audited June 2013


ASSESSMENT REPORT


Tuan Mee POM

Tuan Mee Sungai Buloh, Selangor 1.556 2012 Audited November

2012

Kuala Pertang POM

Kerila Tanah merah, Kelantan 2.191 2013 Pending

Pasir Gajah Kuala Krai, Kelantan 2.107 2013 Pending

Sungai Sokor Tanah Merah, Kelantan 1.603 2013 Pending

Changkat Chermin POM

Lekir Manjung, Perak 3.332 2012 Audited November

2012

Changkat Chermin Manjung, Perak 2.540 2012 Audited November

2012

Raja Hitam Manjung, Perak 1.497 2012 Audited November

2012

Allagar Trong, Perak 805 2013 Audited November

2012

Glenealy Parit, Perak 1.059 2013 Audited November

2012

Serapoh Parit, Perak 936 2013 Audited November

2012

Kuala Kangsar Padang Rengas, Perak 843 2013 Audited November

2012

SABAH, MALAYSIA

Mill 1 Tawau, Sabah Outside Crop

Mill 1 Jatika Tawau, Sabah 3.508 2009 Certified 2009

Sigalong 2.864 2009 Certified 2009

Pangeran 2.855 2009 Certified 2009

Sri Kunak 2.770 2009 Certified 2009

Pang Burong 2.548 2009 Certified 2009

Pinang Pinang Tawau, Sabah 2.420 2009 Certified 2009

Tundong 2.155 2009 Certified 2009

Ringlet 1.834 2009 Certified 2009

Lungmanis Lungmanis Lahad Datu, Sabah 1.656 2010 Certified 2010

Sungai Silabukan 2.654 2010 Certified 2010

Rimmer Rimmer Lahad Datu, Sabah 2.730 2010 Certified 2010

Tungku 3.418 2010 Certified 2010

Bukit Tabin 2.916 2010 Certified 2010

Bornion Bornion Kinabatangan, Sabah 3.233 2010 Certified 2010

Segar Usaha Kinabatangan, Sabah 2.792 2010 Certified 2010

Kuala Lumpur Kepong Bhd has informed the Time Bound Plan progress, MUTUAGUNG has consider that Kuala Lumpur Kepong Bhd still comply to the RSPO requirement for Time Bound Plan.


ASSESSMENT REPORT


2.0 ASSESSMENT PROCESS

2.1 Certification Body

PT Mutuagung Lestari

Jl. Raya Bogor Km 33,5 No. 19, Cimanggis - Depok 16953

Telp. +62-21-8740202; Fax +62-21-87740745/46

Website: www.mutucertification.com Email : [email protected]

2.2 Assessment Team

2.2.1 Lead Assessor and Assessment Team

ST-2 1. Octo Nainggolan (Lead Auditor). Indonesian citizen, Bachelor of Agriculture, majoring of Social Economics of Agriculture (Agribusiness). He has a working experience since 2004 oil palm Plantation Company in Indonesia. Trainings attended namely: Training of Conservation of Natural and Biological Resources in supporting HCV, Basic Plantation Management Program, Plantation Integrated Pest Management training, Followed the Management System Certification (ISO 9001-2008/SNI 19011-9001:2008), Environment Management System (ISO 14001:2004) , RSPO Lead Auditors Training Course, Indonesian Sustainable Palm Oil (ISPO) Lead Auditor training course and supply chain certification system training. Currently, he worked at Professional Certification Body. In the assessment activity, he assessed on legal aspect, best practices, environment aspect, social aspect, workers welfare, FFB Processing and supply chain requirement.

2. Marsudi Eko Santoso (Auditor). Indonesian citizen, Bachelor of Agriculture, majoring in Agro technology. Followed the Management System Certification (ISO 9001-2008), Awareness HACCP certification, training of RSPO auditor and training of RSPO Lead Auditor training, ISPO Lead auditor training and distribution quality management process - APMEA. He had involved several time in RSPO certification assessment activities as an auditor. Currently he works for Independent Certification Body. In this assessment activity, he assessed on Best Practices, Soil and water conservation, Integrated Pest Management and safety and health.

ST-2 1. Octo Nainggolan (Lead Auditor). 2. Marsudi Eko Santoso (Auditor). 3. Ardiansyah (Auditor). Indonesian citizen, Bachelor of Forest Resources Conservation, Department of Forestry,

Bogor Agricultural University. He has followed several activities such as preparing EIA document for plantation and plantation forest, contribute on several HCV identification and several times following audit activities related to sustainable palm oil certification system as an auditor. In this Assessment assessed the environmental aspects, HCV, soil and water conservation.

4. Bukti Bagja (Auditor). Indonesian citizen, Master of Science in the field of Environmental Sciences, University of

Indonesia. Training he has followed are: awarness of RSPO certification system. He has followed several activities GAP Analysis of the RSPO Principles and Criteria implementation in several oil palm plantations in Indonesia as assessor. Besides that he is also involved in several assessments HCV / HCV as an assessor with the specifications in the field of GIS (mapping). He has expertise in mapping such as ArcGIS, MapInfo, Global Mapper, ER Mapper, Erdas Imagine. In this activity, he has assessed for environment aspect and management of waste.

ASA-01 1. Oktovianus Rusmin (Lead Auditor). Bachelor’s Degree in Social & Political Sciences Department of Anthropology. Specialists in the field of Social and Cultural (Social Impact & Conflict Resolution) and HCV. Already participated in Forest Management Auditor Training (FSC Standard), ISO 14001 Environmental Management System Training, SVLK (wood legality) Auditor, Indonesian Sustainable Palm Oil (ISPO) and RSPO Lead Auditor Training. He was several times involved in the assessment of Sustainable Forest Management Certification (Standard LEI) and Gap Analysis Audit (FSC Standard). Had worked at the Center for study of Anthropology University of Indonesia and Social Advisor at Tropical Forest Trust (TFT) Indonesia. He was numerously involved in Social Impact Assessment and HCV Identification in Palm Oil Plantations and Natural Forest concessions and was approved as HCV assessor by RSPO for Social Discipline Specialist. Have been involved in several palm oil certification as Auditor and Lead Auditor.

2. Marsudi Eko Santoso (Auditor). Indonesian citizen, Bachelor of Agriculture, majoring in Agro technology. Followed the Management System Certification (ISO 9001-2008), Awareness HACCP certification, training of RSPO auditor and training of RSPO Lead Auditor training, ISPO Lead auditor training and distribution quality

http://www.mutucertification.com/

mailto:[email protected]


ASSESSMENT REPORT


management process - APMEA. He had involved several time in RSPO certification assessment activities as an auditor. Currently he works for Independent Certification Body. In this assessment activity, he assessed on Best Practices, Soil and water conservation, Integrated Pest Management and safety and health.

3. Trismadi Nurbayuto (Auditor). Associate Forestry from the Forestry Faculty IPB and Bachelor of Economics from

the Department of Agribusiness, Faculty of Economics and Management, IPB. Specialists in the Environmental Social Impact Assessment (SEIA) and the High Conservation Value (HCV). He participated in HCV Management Training, Indonesian Sustainable Palm Oil (ISPO) Auditor, training of ISO 9001:2008 Quality Management System and ISO 14001:2004 Environmental Management System. Previously worked in the private oil palm plantations, became HCV assessor who registered at the Roundtable on Sustainable Palm Oil (RSPO) until 2014. He has been involved in the activities of SEIA and Identification of HCV in Palm Plantation. Currently has been several times following audit activities related to sustainable palm oil certification system as an auditor. In this assessment activity, he conducted assessment of HCV and environment.

4. Steve Mualim (Auditor). Master in Environmental and natural resources management, Bogor Agricultural University. He has worked as a freelance in several consultant in the Environmental Impact Assessment. He has followed training of Lead Auditor training ISPO, RSPO awareness, Ecological Risk Assessment, Asian Network Update and Carbon, and Climate Change Mitigation and Adaptation for Agricultural Productivity. In this assessment activity, he conducted assessment of Best Agriculture Practices and AMDAL.

5. Muhammad Rinaldi (Observer). Associate of Oil Palm Plantations, Bogor Agricultural Institute. He have 4 years

experience working as a staff operational plantations at private oil palm plantation companies in Indonesia. He has attended the RSPO Awareness training. At ASA-01 activity he become an observer.

2.3 Assessment Methodology, Assessment Process and Locations of Assessment

2.3.1 Figure of person days to implement assessment

ST-1

Number of auditors : 2 (two) auditors Number of days for ST-1: 3 (three) days Number of working days for: 6 (six) working days

ST-2 Number of auditors : 4 (four) auditors Number of days for ST-2 on site : 5 (five) days Number of working days for ST-2 on site: 20 (twenty) working days

ASA-1 Number of auditors : 4 (four) auditors, 1 (one) observer Number of days for S-1 on site : 5 (five) days Number of working days for ST-1 on site: 20 (twenty) working days

2.3.2 Detail process of assessment

ST-1 The assessment was conducted by measuring the sufficiency of implementation with the consistency done by the Tapung Kanan POM and its supply base (PT Sekarbumi Alamlestari). to the requirements of National Interpretation of the Republic of Indonesia from RSPO Principles and Criteria for Sustainable Palm Oil Production (RSPO INA-NIWG, May 2008 and Scheme Smallholders October 2009) and Supply Chain Requirement for CPO Mill. The assessment was conducted in three methods by document review, aiming to observe the sufficiency of types or substances from required documents;

ST-2 The assessment was conducted by measuring the sufficiency of implementation with the consistency done by the Tapung Kanan POM and its supply base (PT Sekarbumi Alamlestari). to the requirements of National Interpretation of the Republic of Indonesia from RSPO Principles and Criteria for Sustainable Palm Oil Production (RSPO INA-NIWG, May 2008 and Scheme Smallholders October 2009) and Supply Chain Requirement for CPO Mill The assessment was conducted in three methods: (1) document review, aiming to observe the sufficiency of types or substances from required documents; (2) interview, aiming to obtain more detailed information and cross check the information; and (3) field observation, aiming to observe directly the sufficiency of implementation on site. Several opportunities for improvement of the results ST-2 delivered by the auditors to the management unit and the results are the subject will be verified at the next assessment. Improvement of findings from main assesment findings were observed by auditors at this ST-2 assessment. All information obtained was recorded in Check List of PT Mutuagung Lestari (MUTU) and part of ST-2.


ASSESSMENT REPORT


Please find Appendix 2 for the assessment program

ASA-01 The assessment was conducted by measuring the sufficiency of implementation with the consistency done by the Tapung Kanan POM and its supply base (PT Sekarbumi Alamlestari). to the requirements of National Interpretation of the Republic of Indonesia from RSPO Principles and Criteria for Sustainable Palm Oil Production (RSPO INA-NIWG, May 2008 and Scheme Smallholders October 2009) and Supply Chain Requirement for CPO Mill The assessment was conducted in three methods: (1) document review, aiming to observe the sufficiency of types or substances from required documents; (2) interview, aiming to obtain more detailed information and cross check the information; and (3) field observation, aiming to observe directly the sufficiency of implementation on site. Several opportunities for improvement of the results ASA-01 delivered by the auditors to the management unit and the results are the subject will be verified at the next assessment (ASA-02). Improvement of findings from main assesment findings were observed by auditors at this ASA-01. All information obtained was recorded in Check List of PT Mutuagung Lestari (MUTU) and part of ASA-02.

2.3.3 Locations of Assessment

ASA-01 The sample location for this certification is: 1 mill with 3 estates, which supply the fresh fruit bunches, such as Tapung Kanan 1 Estate, Tapung Kanan 2 Estate and Tapung Kanan 3 Estate. The audit team used the 0,6√y formulation to choose the main sample of the estate for the main evaluation. Based on this formulation, the audit team chooses 2 samples of estate, such as Tapung Kanan 1 Estate and Tapung Kanan 2 Estate.

Tapung Kanan POM:

1. Processing (from loading ramp to dispatch).Observation regarding the processing process to change the fresh fruit bunch (FFB) into crude palm oil (CPO) and fire extinguisher infrastructure in the mill. Interview with mill’s personnel (boiler operator, engine roomoperator) regarding the medical examination, operator’s license, wage, complaint mechanism, the implementation of occupational health and safety (OSH), capacity building/ training, safe work procedure, the availability of personnel protective equipment (PPE) and the mechanism of mass balance model supply chain.

2. The chemical warehouse. Observation on the chemical handling process and interview with warehouse officer related to chemical handling procedure and management, the emergency response and the implementation of occupational health and safety (OSH).

3. Water Treatment Plan. Observation on the clean water supply. 4. Workshop. Observation on emergency response and occupational health and safety (OSH) such as first aid

boxes and interview with the welders regarding the training, medical examination, implementation of occupational health and safety (OSH), safe work procedure, complaint mechanism, and the freedom to establish union and wages.

5. Diesel fuel Tank. Observation on the availability of fire emergency response kits. 6. Temporary storage for hazardous waste in mill. Observation on hazardous waste management whether it is

in accordance with the applicable regulation and interview with hazardous waste storage officer regarding the medical examination, hazardous waste handling procedure and the availability of infrastructure to handle the pollutions andexposures.

7. The installation of wastewater treatment plan (WWTP). Observation on liquid waste management in the mill and the management to reduce the pollution.

8. Hydrant pipe.Auditor ensures that there is no leakage on the hydrant pipe during the second stage of audit.

Tapung kanan 1 Estate:

1. HGU stakes(stake sample 20 – 16 & 66 - 72): Based on observation, mostly the stakes are in a good condition and the reading marks are clearly readable, but some of the stakes are broken or vanish.

2. KTK Central warehouse. Auditor conducting the observation and interview with the chief of warehouse


ASSESSMENT REPORT


regarding the PPE usage, emergency response facility, the knowledge and understanding on the risk evaluation and management, periodic medical examination that carried out annually, the explanation on the acceptance and management of materials, the understanding on first aid, PPE control, wage disbursement that has been exceeded the minimum wage, public infrastructure such as housing facility with 2 bedrooms, the availability of adequate bathroom, the provision of clean water, wardrobe closet, the provision of electricity, the implementation of service quality evaluation by supervisors, the personnel have been registered to the national social insurance/ jamsostek, hazardous waste management by collecting the waste in the licensed hazardous waste warehouse, the storage is categorized based on the type and characteristic, the hazardous materials are storaged separately, the warehouse is completed with the hazardous symbols.

3. Block 10-A Division 2B Observation and interview with the spraying personnel and foreman’s regarding the work procedure, the usage and provision of PPE, firs aid, work’s risks, periodic medical examination, the availability of information board of ongoing sprayed area, restriction for pregnant and lactating female workers to spray, wage, restriction to spray along riparian area, housing facility, complain mechanism regarding gender issue and socialization regarding the NKT area.

4. Block 06-A Division 2BObservation and interview with fertilization personnel and foreman regarding the work procedure, the usage and provision of PPE, firs aid, work’s risks, periodic medical examination, restriction for pregnant and lactating female workers to spray, wage, restriction to spray along riparian area, housing facility, complain mechanism regarding gender issue and socialization regarding the NKT area.

5. Block 95-G Division 2B. Observation on holistic pest handling by breeding the Tyto alba, as well as conducting the observation and interview with harvesting personnel and foreman regarding the work procedure, the usage and provision of PPE, firs aid, work’s risks, periodic medical examination, wages, housing facility and socialization regarding the NKT area.

1. Block 95-E Division 2B. Observation regarding the management of domestic waste. 2. Block 93-C Division 2B. Observation on holistic pest handling by using Turnera subulata plant. 3. Block 92-B Division 2B. Observationandinterview with empty fruit bunch applicators regarding the application of

empty fruit bunches and wage’s system. 4. Block 98-I Division 2B. Observation and interview with land application operators regarding the implementation

of land application. 5. Fire infrastructure. Observation on the facilities of field fire, such as water tank, pipe, nozzle, bucket, etc. is

ready to use. 6. Workshop. Observation and interview with chief of workshop regarding the workshop activities for maintaining

the vehicles and heavy equipment, the management of used oil waste, used accumulators and used filters. 7. Clinic. Observation on clinic equipment and interview with paramedic (midwives) regarding the number of visitor,

health program, medical examination, and the management of infectious waste. 8. Housing for personnel. Observation on personnel’s housing condition, the clean water’s supply and domestic

waste management. 9. Riparian area (HCV area). Observation on the marks of riparian area, enrich the types and restriction to use

chemical material along the riparian area (KTK 3), Tapung Kanan river (KTK 3 division 4 A), and Sepahat river (KTK 1 division 2A and 2B).

Tapung Kanan 2 Estate:

1. HGU boundary stakes(stake sample, 125 – 138): Based on observation, mostly the stakes are in a good condition and the reading marks are clearly readable, but some of the stakes are broken or vanish.

2. Housing for personnel. Observation on personnel’s housing condition, the clean water’s supply and domestic waste management.

3. Childcare facility. Observation on childcare facility, wage for childcare staff whether it is in accordance with the applicable regulation, APAR are available and first aid boxes are in a good condition.

4. Block PM053A.Observation on the availability of fire signboard and firing area. 5. Generator hut KTK 2.Observation on the hazardous waste management (used oil, used filters and used

lubricants are collected and further to be stored in licensed hazardous waste warehouse, the OSH signs and the usage of PPE by operators.

6. Block 92-E Division 3A. Observation and interview with the spraying personnel and foreman regarding the work


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procedure, the usage and provision of PPE, firs aid, work’s risks, periodic medical examination, the availability of information board of ongoing sprayed area, restriction for pregnant and lactating female workers to spray, wage, restriction to spray along riparian area, housing facility, complain mechanism regarding gender issue and socialization regarding the NKT area. Moreover, the observation on holistic pest management by using the Turnera subulata plant. Furthermore, the audit team also conducting the observation and interview with tractor’s operator regarding the PPE provision and usage, wage and training/license (SIO)for tractor.

6. Block 95-D Division 3A. Observation on holistic pest handling by breeding the Tyto alba, as well as conducting the observation and interview with harvesting personnel and foreman regarding the work procedure, the usage and provision of PPE, firs aid, work’s risks, periodic medical examination, wages, housing facility and socialization regarding the NKT area. In addition, conducting observation related to empty fruit bunches application.

7. Block 94-G Division 3A. Observation related to the management of domestic waste 8. Riparian area (areal HCV).Observation on the marks of riparian area, enrich the types and restriction to use

chemical material in Sepano River (KTK 2 Division 3A).

Villages and Institutions:

1. Kota Garo Village. The purpose of visiting this village is to gain information from head of village, community leaders and local community regarding the social interaction between estate management with local community as well as the implementation of CD/CSR, the information on the impact of the estate and mill of PT Sekarbumi Alamlestari.

2. Kota Bangun Village. The purpose of visiting this village is to gain information from head of village, community leaders and local community regarding the social interaction between estate management with local community as well as the implementation of CD/CSR, the information on the impact of the estate and mill of PT. Sekarbumi Alamlestari.

3. Environmental Agency of Kampar District.Interview with officer from the Environmental Agency of Kampar District regarding company’s obedience on managing and monitoring the environment.

4. Manpower Agency of Kampar District. Interview with officer from the Manpower Agency of Kampar District regarding company’s obedience towards manpower’s regulation.

5. Plantation Agency of Kampar District. Interview with officer from thePlantation Agency of Kampar District regarding company’s obedience towards agriculture/plantation’s regulation.

2.4 Stakeholder Consultation and List of Stakeholders Contacted

2.4.1 Summary of stakeholder consultation process.

Public consultation process was carried out through two ways, namely: 1) Conducting a public announcement on RSPO website (www.rspo.org) 30 days at minimum prior to the ASA -01

audit implementation. 2) Consultation of stakeholders for PT Sekarbumi Alamlestari was held by public consultation meeting with internal

(workers and management representative), external (villagers, local peoples, non government organization and district agencies) by interviews and visits.

Public consultation meetings with stakeholders. At the District is directly by visiting and consulting directly with government on February 25, 2014. Public consultation with local stakeholders (village and sub-district level) conducted with a meeting at the Village Head Office on February 26, 2014 and February 27, 2014. The consultation result present on 3.6 (Summary of Arising Issues from Public, Management and Auditor Response)

2.4.2 List of stakeholder contacted

Please find appendix 3

2.5 Determining Next Visiting

The next visit (ASA-02) will be determined one year after this ASA-01 (February 2015).


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3.0. ASSESSMENT RESULT 3.1. Summary of Assessment Report of the RSPO Certification

MUTUAGUNG LESTARI has conducted an assessment of PT Sekarbumi Alamlestari. – Tapung Kanan POM, Kuala Lumpur Kepong Bhd operation consisting of 1 (one) mill and 3 (three) oil palm estates.

During the assessment, there were two (2) nonconformities were assigned against Minor Compliance Indicators 4.7.6,

6.3.1; two (2) opportunities for improvement were identified; and for SCCS Modul E (Mass Balance) not found

nonconformity.

Further explanation of the non-conformities raised and corrective actions taken by the company are provided in section

3.5.

MUTUAGUNG LESTARI found that PT Sekarbumi Alamlestari comply with the requirements of RSPO Principles &

Criteria and National Interpretation, RSPO Principles and Criteria (P&C) for Sustainable Palm Oil Production, Republic of

Indonesia - RSPO INA-NIWG, May 2008. Therefore, PT. Mutuagung Lestari recommend RSPO certificate of eligibility to

be maintained.

Ref Std.

VERIFICATION RESULT of MUTU-Certification

PRINCIPLE #1 COMMITMENT TO TRANSPARENCY

1.1 Plantation and Palm Oil Factory have to give adequate information for stakeholders in appropriate language and forms, to ensure the effective participation of stakeholders in decision-making.

During the surveillance 1, SOP no.1 on 12 April 2012 regarding the information and responses request that are endorsed by the Senior Manager have no change, the available information, such as:

Every written information requests from stakeholders must be recorded inthe “information requests and responses Log Book”

Deadline for response is within 15 days

If there is an excuse for the delay of the response (more than 15 days), the company should inform the stakeholders as well as provide the reason for this delay.

The response letter should be signed by manager or officer in charge and should state the date.

Every oral information request from stakeholders should be recorded in the information requests and responses Log Book”.

Until the surveillance 1, there is no information request from stakeholders, only grants request, but the company has given the mandatory information regularly to the related agencies such as RKL&RPL report to BLHD, mandatory manpower report to the manpower agency, three months report of P2K3 to the manpower agency, three months report of hazardous waste to environment agency, etc. Based on document’s review during the surveillance 1, there was no response over the information/complaints/grants that exceeding 15 days and based on consultation with stakeholders, the company always responses the information/complaints/grants request very well.

There is a revision on the list of main document on 1 October 2013, which endorse by the Senior Manager that inform the name of the document, document’s owner, location of document, status of the document (confidential/public document) and duration of document’s shelf life. For the request record and information response will be kept until 5 years, which are accessible for public and hold by Senior Manager in the RSPO room.

Status: Full Compliance


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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.

PTSA has revised the list of main document on 1 October 2013 and approved by the Senior Manager. This document informs the name of the document, document’s owner, location of document, status of the document (confidential/public document) and duration of shelf life, such as:

1. Administrative document for public use such as Regional Director-Memo, Taxes, Purchase Order, Field Upkeep Program, Insurance, Crop Forecast, Workers Pay slipetc. Meanwhile theadministrative document, which is confidential such as Management Staff, Action Committee Meeting, Hectare Statement, social insurance/jamsostek, Internal Audit etc. the shelf life is based on the type of document, from 5 to 10 years.

2. The available RSPO related documents for public use have a shelf life for 5 years. 3. The available K3 related documents for public use have a shelf life for 5 years. 4. The applicable related documents for public use have a shelf life as long as the regulation is still applicable or

not yet revised.


PRINCIPLE #2 COMPLIANCE WITH APPLICABLE LAWS AND REGULATIONS

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

PT Sekarbumi Alamlestari presents the efforts to compy the applicable regulation, such as:

a. Salary for personnel is in accordance with the applicable regulation, which based on regional minimum wage (UMP) that set by the local government (Riau’s Governor) and is issued every year.

b. PT Sekarbumi Alamlestari has a partneship for the estate business with a KKPA form (cooperative credit for member) covering an area of 1.294 Ha based onLaw Number 18 in 2004 about estate.

c. PT Sekarbumi Alamlestari has points out the protective area and HCV area, which are in accordance with the presindent decree number 32 in 1990 regarding the management of proective area.

d. PT Sekarbumi Alamlestari has had the estate bussiness licensed that is in accordance with the ministry of agriculture regulation (Permentan) number 26 in 2007 regarding the guidelines of estate bussiness license.

e. The assessment of estate bussines has been conducted in accordance with the regulation of ministry of agriculture (Permentan) number 7 in 2009 regaridng the assessment of estate bussiness.

f. PT Sekarbumi Alamlestari has had the location permit, which is in accordance with the with the agriculture regulation Number 2 in 1999 regarding the location permit.

g. PT Sekarbumi Alamlestari has had the land ownership, which is in accordance with the govenrment regulation number 40 in 1996 regarding the bussiness license right (HGU)

h. PT Sekarbumi Alamlestari has conducted the management of hazardouse waste, which is in accordance with the government regulation number 18 in 1999 regarding the management of hazardous and poison waste.

i. PT Sekarbumi Alamlestari has had the environment impact assessment analysis (AMDAL, RKL/RPL), which is in accordance with the government regulation Number 27 in 2012 regaridng the environment permit.

j. PT Sekarbumi Alamlestari has reported the update of estate bussiness developemnt to the estate agency of kAMPAR District (the receipt from environment agency of Kampar District on 21 October 2013 is available).

k. The submission of report regarding the mandatory manpower report for estate’s unit and mill’s unit to the agency in 2013.

Internal & external audit are ensure the unfulfilled material will be improved as soon as possible and the evaluation toward the law and regulation compliance will be conducted every 6 months.

Based on consultation result with several institutions in Kampar District (Estate Agency, Environment Agency, Manpower Agency and National Land Agency), there is no information regarding the company’s noncompliance toward the applicable regulation, such as the effort to comply the salary with the applicable regulation, which is based on regional minimum wage (UMP) that set by the local government (Riau’s governor) that is issued every year.



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

Ownership document and area’s management, which are belong to PT Sekarbumi Alamlestari, such as:

a. Decision of the state ministry of Agrarian/ head of national land agency number 36/HGU/BPN/94 on 29 July 1994 regarding the award of business right on behalf of PT.Sekarbumi Alamlestari, which covers an area of 6,200 Ha.

b. Business license certificate (HGU) No.01 Sukamaju village, Kota Baru, Kota Bangun, Siak Hulusub district, Kampar district, Riau province on1 December 1994, with an area of 6.200 Ha that comes into effect until31 December 2024 (30 years).

c. The grant of extension for the business license over the land in Kampar district, Riau province is based on the decision of head of national land agency (BPN) Number 133/HGU/BPN/2004 on 2 November 2024 and has been extended for 25 years, until 31 December 2024.

d. Estate business permit– Cultivation(IUP-B)based on the decision of Kampar regent number: 525 / DISBUN / 514 / 2007 on 26 September 2007 regarding the plantation/ estate business permit grant for PT Sekar Bumi Alam Lestari, covering an area of6.200 Hawith type of cultivation business is palm oil and the estate business permit – operation(IUP-P), which based on decision of Kampar regent number: 525/DISBUN/210/2009 on 10 June 2009 regarding the estate business permit grant for operation with a capacity of 30 Tones FFB/Hour for palm oil mil.

The boundary stakes assessments such as the boundary stones’ checklist are available, such as:

a. Estate Tapung Kanan 1 with 72 stakes been identified (2 stakes are missing) b. Estate Tapung Kanan 2 with 23 stakes been identified (5 stakes are missing) c. Estate Tapung Kanan 3 with 46 stakes been identified

There are 141 stakes been installed and been identified from 148 stakes (95 %)

The boundary stakes assessment is conducted every 6 months and the boundary stakes maintenance is conducted by cleaning the area surrounding the boundary stakes.

Based on field visit for assessing the boundary stakes, stake sample are 16 – 20 & 66 – 72 in the Tapung Kanan 1 estate unit and stakes 132 – 138 & 127 – 131 Tapung Kanan 2 estate, shows that the condition of the stakes are good and well maintained, the numbering is readable even thought some stakes need to be improved.

Samples for land release are:

a. Finalization report of HGU PTSA, which based on the letter from head of Kota Garo village, number 029/KG/TH/V/2004 on 21 May 2004.

b. Minutes of the meeting on the land settlement of PT Sekarbumi Alamlestari, which is operated by community in subvillage II Rumah Tiga, on 19 May 2004. Head of Kota Garo village, Chief of Lembaga Ketahanan Masyarakat Desa (LKMD), chief of Badan Pengawas Desa (BPD), Ninik Mamak (traditional figure), village figure and community chaired this meeting. (Attendance sheet is available).

c. Information letter, which mention that the community has pointed their representative to the head of Kota Garo village to settle the operated land on 24 April 2004.

Based on consultation result, some institutions in Kampar district (estate agency, environment agency, manpower and national land agency) as well as the consultation result with the local stakeholders in Kota Bangun and Kota Garo village, it’s known that the area surrounding the PT Sekarbumi Alamlestari estate has no land that belong to the indigenous people/traditional community. The compensation process has been done in the early stage of estate development.


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.

Based on information from the estate management, the interview with head of Kotabangun and Kota Garo village, the estate area of PT Sekarbumi Alamlestari has no indigenous/ traditional area within its estate area.


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The existing record is an evidence of the land release in early stage of estate development, for instance: receipt letter on behalf of Sidal from Kota Batak village. This letter explains that by signed that letter, the land owner has released his right over the land of 2 Ha and free the government c/q the committee of land release in Kampar district as well as PT Sekarbumi Alamlestari from any charge in the future.

Sample of agreement letter is letter number 05 on 14 May 1991 on behalf of Sidal (40 years old) that is located in Sekijang village Siak Hulu district, with an area of 2 Ha, type of plantation is rubber plantation for about 13 trees and the land is well maintaine. This data is approved/accepted/corrected by the owner; company’s representative; national land agency officer;regency officer;estate agency officer;dispera agency officer; subdistrict officer and village officer.


PRINCIPLE #3 Commitment to long-term economic and financial viability

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

PTSA has a long term plan for estate and mill, which stated in the estimation period 2013/2014 Financial Year (October– September) that allocate the budget, such as:

a. Estate production estimation for period 2012/2013-2015/2016, Administration cost, labor cost, upkeep, Manuring, harvesting, Roads and Bridges, Pest and Disease, transport, etc.

b. Crop intake estimation (FFB), CPO’s production, Palm Kernel production, processing cost, Admin cost, Training cost, Environment cost, Health cost, Transport cost, etc.

c. For the environment and social management plan, the company has allocated the budget plan for activities, such as: wells for personnel, Insurance, Medical and Hospital, Amenities and Welfare, Occupational Health and Safety (OSH) and Sustainability, Corporate Social Responsibility (CSR).

5 years work plan and Economic Indicators:

2013/2014 2014/2015 2015/2016 2016/2017 2017/2018

Mature area 5,178 5,178 5,178 5,178 4,676

FFB (Ton) 137,949 136,282 134,165 129,948 114,202

Yield (Ton/Ha) 26.64 26.32 25.91 25.10 24.42

CPO extraction (%) 22.25 22 21.75 21.5 21.25

PK extraction (%) 5.75 5.75 5.75 5.75 5.50

Replanting plan in 2017/2018 is for areawith planting year in 1992, which covers an area of 502 Ha.

Replanting plan in 2017/2018 is for area with planting year in 1992, which covers an area of 502 Ha in KTK 1 and KTK 2. Based on the explanation from the manager, the detail of replanting plan has been drafted for 3 years before the replanting (2014/2015), including the used seeds.

Based on SOP No. 4 regarding the replanting, it has been explained that the replanting plants are the one that no longer has an economic value, because of:

Age of plan is 25 years old.

The height of plantation is over 18 Meters

The FFB production is under 14 tones/ha/year

Number of plantation per hectare is less than 70 plants.


PRINCIPLE #4 Use of appropriate best practices by growers and millers

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

There is an SOP ISPO/RSPO PT Sekarbumi Alamlestari that is endorsed by the Senior Manager on1 August 2013 (Revision 5) and technical guidelines of palm oil estate PT KLK Agriservindo (Number: GP/AGRIC/OP) on 25 November 2004, covering


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activities,such as:

Replanting, covering the land clearing without burning/ zero burning (stated in SOP 4/ replanting and GP/AGRIC/OP7),

Nursery (GP/AGRIC/OP7 replanting)

Block identification (GP/AGRIC/OP9)

Land pavement and drainage (GP/AGRIC/OP10)

Land maintenance including the weed control (GP/AGRIC/02)

SOP on Nutrition/Harvesting (SOP 12. Estate and GP/AGRIC/03)

Palm oil cultivation on a mineral soil (SOP RSPO 34).

Palm oil cultivation on the peat land (SOP RSPO 32)

The fertilization recommendation is available from PT AARI and the safe fertilization procedure is stated in the Safety Operating Procedure point 10;

SOP for the holistic pests handling (SOP RSPO 7 and GP/AGRIC/OP5);

Land and water conservation (GP/AGRIC/OP5);

Erosion control (SOP 13. estate);

Identificationand HCV management (SOP 15. estate),

Harvesting (SOP RSPO 37).

There is a Procedurefor occupational health and safety, which endorsed by the Senior Manager on 1 November 2011 (SaOP/Safety Operational Procedure). Explains the safe work procedure.

There is an SOP for Mill Operation of Tapung Kanan mill, which endorsed by the mill’s manager. The procedure consists of the SOP for weight bridge station, palm oil processing in the SOP of each station(Loading Ramp Station; Sterilization Station, Hoist and Threshing Station, Digester Station, Press station, Depicarper Station, Nut Cracker Station, Kernel Silo, Boiler House, Power station and CPO Dispatch). Based on field observation in estate and mill, for instance in the area of spraying activity, fertilizing, harvesting and FFB processing, it’s known that the operational activity is undertake in accordance with the existing SOP.

The operational evaluation and monitoring activities, such as: 1. The public accountant audit activity, which was conducted on17 October 2013 by Anwar and partners with

unqualified/ wajar tanpa pengecualian(WTP) result. 2. Report of the Internal audit result (Comment Account Report) in August 2013 for tapung kanan mill, its known the

incompliance on the weighbridge management and store operations. The improvement result will be sent on 10 October 2013.

3. The plantation census report in KTK 1 (there were 243.600 trees) and KTK 2 (there were 204.231 trees) in 2012, the census is conducted every 5 years.

4. Machines inspection in 2013 had monitored by the maintenance division of the manpower agency of Kampar District (for instance: generator, steam vessel, steam separator, sterilizer, turbine and hoisting crane).

5. Work performance evaluation is in accordance with the SOP for operator, which is conducted by the assistant and manager through training assessment. For instance the technical mill’s operational training and K3 on 23 Augustus 2013.

6. There are soil and leaf visual analysis reports, which were conducted by the AAR for period 2013/2014.

Latest record on the monthly operational activity for Tapung Kanan estate in the Progress Report of Tapung Kanan estate is available inJanuary 2014. Prepared by the secretary of Senior Manager based on the report from the assistant and known by the manager and reviewed by the Senior Manager and further delivered to theRegional Director. Record on the monthly operational activity for Tapung Kanan mill in the mill’s Progress Report of Tapung Kanan Prepared by the secretary of Senior Manager based on the report from the assistant and known by the manager and reviewed by the Senior Manager and further delivered to the Regional Director. Based on filed visit, the company has undertaken the operational activity based on the existing SOP.



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

The company has undertaken several periodic analysis, including: a. Soil analysis by the AAR, which stated in the Field Assessment Note in 2013/2014. The measured Parameters such

as Horizon, pH in water, Org. C, N, P, Acid fl soluble, exchangeable cations K, H, Ca, Mg, C.E.C NH4OAC: XL. b. Leaf analysis, Foliar Analysis Result for 2013/2014 for each block, covering an analysis for Major Elements (Ash, N,

P, K, Ca and MG). c. Visual analysis by the AARI, which stated in the Field Assessment Note in 2013/2014, isincluding the Canopy Size

Assessment, Nutrient Deficiency and palm circle assessment.

There is a document forOil Palm Manuring Recommendation 2013/2014, which distributes by the Agronomist on 5 October 2013 such as explains the fertilization recommendation, which based on the leaf analysis for each estate, the soil analysis and plantation visual analysis.

Activity to sustain and improve the soil fertility that implement by the PTSA are: fertilization, empty fruit bunches application and land application.

Until ASA-01, the realization of second semester fertilizationis in accordance with the plan, such as fertilization with a fertilizer type RP (Rock Phosphate) in KTK 1, which conducted inJanuary 2014 with a doze of 3 Kg/treebased on the fertilization recommendation from AAR.

There is aLand Application record in the waste volume document to the land application in KTK 1 (98 I/ Block 344 and 374 with board of 38 Hectare). For instance, on18 January 2014, the total working hour for pump is 9 hours in Block 344 with the land application volume 216 M3.

There is a recommendation of the FFB application with a doze of 2000 Kg/Ha. The document of FFB application realization in KTK 1 block 93F (62 ha) with a doze of 25,20 tones/ha, meanwhile the application of EFB in KTK 2 block 95 D (66 ha) with a doze 24,72 tones/ha.

Based on field visit in block 92B, visually the palm oil leaf is green, this presents that there is no lack of N, P, K and Br elements.Meanwhile for field observation for the liquid waste application in block 95E, the company uses the flat bad system, there is no leakage in the surrounding area, and there is an officer to monitor the liquid waste application and to control the liquid waste volume that being applied by using the flow meter.


4.3 Practices minimize and control erosion and degradation of soils.

PT Sekarbumi Alamlestari has aTentative Detail Soil Map, which explains the type of soil, such as:

Land Unit Parent Material

Slope (%)

Major Soils Total Area (Ha)

Pfq.2.2 Clay, sand 0-8% Dystropepts, haplomults, haplodux, tropaquepts 3,355

Pfq.2.1 Clay, sand <3%

0-8%

<3%

<3%

Dystropepts

Kanhapludults

Haplodux

Tropaquepts

1,638

Pfq.9.3 Clay, sand >16% Kandiudults, Hapludox, Paleudults, Dystopepts 847

Au.1.2 Clay, sand <3% Tropauepts, Dystropepts, Tropofluvents, Tropohemists

412

D.2.1.3 Peat <3% Troposaprists, Tropohemists, Tropoffibrists 402


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Pfq.3.2 Clay, sand 3-8% Kandiudults, Dystropepts, Hapudox, Tropaquepts 162

Pfq.4.2 Clay, sand 3-8% Kandiudults, Dystropepts, Hapludox, Hapludults 147

Total 6,963

From this map, there is a type of soil that categorized in marginal type of soil, such as peat land.

Management strategy for sloping are, such as:

KLK Good Agricultural Practice (GAP), which explains the palm oil cultivation in the terracering area (Polis number: GP/Agric/OP7, replanting – 4 edition 29 July 2005).

KLK Good Agricultural Practice (GAP), which explains the establishment of terracering(Polis number: GP/Agric/OP5, Conservation – 4 editions 3 June 2005).

SOP 12. The management over the optimum soil fertility for the productivity, which is approved by the Senior Manager (Ng Yee Hong) on 12 April 2012.

PT. Sekarbumi Alamlestari has a road maintenance program such as bridge maintenance/box culvert, washing the trenches, road pavement and grader, which well documented in the record program and realization of road maintenance, such as road maintenance in KTK 1 block 93.A (1A), 93.C (1A), 94.B (1A), 96.D (1A), 94.A (2A), 94.G (2A), 95.B (2A), 95.B (2A), 95.D (2A), 96.C (2A), 96.E (2A), 96.F (2A).

Based on study result of PT Applied Agricultural Resources Indonesia (AAR), which explains that there is a shallow peat in KTK 3, covers an area of 75 Ha in 4 block (94D, 97E, 99G, 01H) in a form of spots and mostly is a mineral soil, the water management is considered not too important. The field visit in Division 4A Block G shows that the left peat area isan only spot and considered shallow. Visually the majority of the soil is a mineral type.

PT. Sekarbumi Alam lestari has a strategy to manage the marginal soil, which stated in the SPO12. Management over the optimum soil fertility for productivity, which is approved by the Senior Manager (Ng Yee Hong) on 12 April 2012 and explains:

The management of marginal soil – sandy, less organic material, podzolik, peat land.

Technical application such as empty fruit bunches for sandy soil, less organic material and silt pit for the podzolik soil

For peat land: there is a water surface management, water gate/dam to control the consistency of water surface level between 50 and 75 cm under the soil surface like in the agronomic guidelines.

Checklistto monitor the water gate condition and trench.

To monitor the level of water surface and collecting canal.

Draft the peat land map

No cultivation undertake in the peat area.

Overflowed water during the rainy season

Strict restriction for burning.

The application of CuSO4, ZnSO4to fulfill the lack of traceelement.

Conducting the trench’s wash.


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

To protect the water flow and wet land including the riparian area, PTSA has drafted some SOP and planning document, which directly related to the soil water and surface water management, such as: 1) SOP for the protection of riparian area (DSS), 2) SOP for soil water and surface water quality, 3) SOP for cultivating the palm oil in the peat area, 4) management plan for annual water, 5) management plan for the HCV area, which consists of management plan for the riparian area.

Type of riparian protection activity which undertake by the PTSA based on the document, are: 1) no more chemical application along riparian area, 2) installation of ban board and boundary marks in a riparian area, 3) cultivation of hard plantation in riparian area(realization in KTK 1: river. Sepahat 166 trees; river. Pelapian: 144 trees) meanwhile in KTK 2: river. Sepano: 170 trees, and 4) the periodic measurement of soil and surface water quality. For the document review, it’s known that the activities were carried out in form of: the socialization of SOP DSS to personnel, map and ban board, cultivation map of hard


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plantations, recapitulation of plantation progress and the periodic result of soil and surface water quality.

To avoid environment pollution because of mill’s waste, PTSA applied the Land Applicationand regularly monitoring the BOD of liquid waste, which is applied in the land. The measurements were conducted in 4 effluentponds by the public work agency of Riau Province. The record over the BOD periodic monitoring is available and can be presented.

In addition to the above efforts, some of water protection, PTSA also monitors the water usage in FFB management through the record of daily water consumption in each mill. The monitoring record of the water usage in 2013 shows the water usage is still under the budget (<1.5m3/tones FFB).

Based on observation result in Tapung Kanan mill, it’s known that previously the pipe is placed underground, but currently the pipe is placed in the ground to make the leakage monitoring more easy to undertake.


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

The company has had the adequate holistic pest management, which based on the SOP RSPO no 7 regarding the holistic pest management. The entire holistic pest management is documented, for instance:

The scope of pest management by using the chemical material is stated in the Upkeep of Mature and Immature areas, which inform the plan and realization of the pesticide application, such as: the targeted application area, total area that not yet realized, the total application area, type of work and type of used pesticide.

Recapitulation of ganoderma insect census for the KTK 2 conducted once a year, for instance on 11 November 2013 on the division 3A block 94 D with an area of 69 ha, the census reveals there is no ganoderma insect in the entire 408 trees.

Recapitulation of fire caterpillar insect census for the KTK 2 conducted every 6 months, for instance on 13 September 2013 on the division 3 A block 95F with an area of 83 ha, the census reveals there are 7 tress from total 539 tress that are infected and still under the threshold (<5%)

The annual PHT training, for instance the spraying training and PHT training on 14 October 2013 regarding theearly warning system/EWS for estate KTK 1 and KTK 2

The company used the PHT cultivation technic and biology such as stated in the costing book in 2014, for instance for division IB for circle path spraying work in January 2014 for an area of 15 ha with a total glyphosate usage is 5.5 liter with and active material 16.8 kg and active material /ha is 0.29 kg/ha, and still under the threshold of usage recommendation.


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.

The company has had the list of agrochemical, which is licensed and permitted by the related institution, such as:

1. Gramoxone 276 SL with a registration number RI.010301197436 valid until 18 Mach 2014 2. Supremo 480 AS with a registration number RI.010301200201712 validuntil 17 October 2017 3. Supretox 276 AS with a registration number RI.01030120042037 validuntil 17 October 2017

The entire agrochemical usage is in accordance with the targeted species, appropriate doze and well-trained officers. The pesticide operator training on 14 December 2012 for 81 officers in PT SA mess (18 foreman and 63 spraying officers) in mess was limited for spraying officers only. This training was delivered by PT Dharma GunaWawa (producen of pesticide from the paraquat active material), which is witnessed by the representative of provincial estate agency.

The agrochemical waste such as the pesticide packages were managed based on the applicable regulation (PP No. 18 in 1999). The waste is stored in licensed temporary hazardous and poisonous waste warehouse in Tapung Kanan mill and Tapung Kanan 1 estate, which further will transport by the licensed contractor, PT Primanru Jaya. Based on document’s study and field observation, its known that the entire hazardous waste management is in accordance with the applicable regulation,


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the symbols are in place as well as the hazardous waste marks. The shelf life is not exceeding the regulation.

Regarding the limited usage of pesticide, the company has showed its commitment to reduce the usage of paraquat for the estate operational activity.From2012 to 2013 the company succeeded to reduce the usage of paraquate significantly, the usage in 2012 was 6680 liters has been reduced to 1007 liter in 2013. More over, the company has a target to reduce the usage of paraquate over the years.

The company has a policy in the SOP 22 regarding the treatment facility, which stated in the medical examination that personnel in a high-risk environment wouldreceive medical examination every year. The medical examination report from 11 November 2013 to 29 November 2013 for the entire fertilization personnel, warehouse personnel, chemical mixing personnel and spraying personnelis available, the medical examination was conducted by the physician from ThamrinClinic Pekanbaru. Non-compliance CAR No. 2012.01 with a minor category is closed.

The company has a policy in the SOP 21 RSPO, which stated:

Pregnancy test: chemical spraying personnel are mandatory to inform the company regarding their pregnancy. After re-examined by the company’s physician, if the personnel are positively pregnant, then the company will offer a lighter job and the personnel will have no contact with the chemical material.

Lactating personnel are restricted to carry the work, which has a relation with chemical material.

There is a pregnancy book, which informs the pregnancy test result by estate midwives, clinic recommendation and the action from the company. For instance: pregnancy examination for Mrs. Yulinawati, fertilization officer KTK I Division 1B on 04/01/2012 is positively pregnant and Mrs. Temu, spraying officer KTK II Division 3 B. Action from the company (mutation to the tunera maintenance). Based on the interview with Mrs. Yulinawati (fertilization officer KTK 1 Division 1 B), it’s known that the company has implemented the appropriate policy (leave, mutation, restriction for pregnant and lactating personnel to work with chemical material).


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

The Group Plantation Director set the policy on the occupational health and safetyon 10 January 2005. The [policy such as:

- Comply the entire related regulation on the occupational health and safety

- Ensure the steps of occupational health and safety are implemented and renewed.

- Provide the adequate capacity buildings, information and guideline on the occupational health and safety aspects.

- Ensure the entire personnel understand their responsibility to work in a safety way in order to avoid work accident for themselves and others.

The occupational health and safety program from January 2014 to December 2014 covers:

Training program including the occupational health and safety technic, environment, manpower and RSPO

The usage of PPE, the occupational health and safety committee meeting.

Medical examination

Noise examination

Emergency response

First aid box

Fire extinguisher

The occupational health and safety audit/RSPO

Risk analysis over the occupational health and safety

Accident report.

There is a procedure for the occupational health and safety in the estate, which was endorsed by the Mill Controller on 1 December 2011 (SaOP/Safety Operational Procedure). This procedure explains the steps of safe work, including the work procedure in weight bridge station, Loading Ramp Station; SterilizationStation, Hoist and Threshing Station, Digester Station, Press station, Depicarper station, Nut Cracker Station, Kernel Silo, Boiler House, Power station and CPO Dispatch. There is a procedure for the occupational health and safety in the estate, which was endorsed by the Senior Manager on 1 November 2011 (SaOP/Safety Operational Procedure). This procedure explains the steps of safe work, including the work procedure for palm oil harvesting, palm oil dispatch to the mill, the storage of chemical material, the chemical transportation, fertilization,


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heavy equipment operators, nursery work, etc.

The company has the guiding committee of occupational health and safety both in mill and estate, which endorsed by the manpower agencythrough the decision letter as below:

1. Decision letter from social and manpower agency No. KPTS.700/DSTK-PHI/2013/27 on 6 Nov. 2013 (PKS Sekarbumi Alam Lestari), chairman Hendry Warsito and secretary Agus Heryanto,SE).

2. Decision letter from social and manpower agency No. KPTS.700/DSTK-PHI/2013/31 on 18 Nov. 2013 (PT Sekarbumi Alam Lestari Tapung Kanan Estate), chairman Ng Yee Hong and secretary Agus Heryanto, SE).

Guidingcommittee of occupational health and safety reports:

1. Report for period November 2013 – January 2014, has been reported on30 January 2014 through a letter No. 026/FM-SA/TKF/I/14.

2. Report for period November 2013 – January 2014, has been reported on 14 February 2014 through a letter No. 045/SM-TKE/SA/II/14.

Guidingcommittee of occupational health and safety meetings re conducted regularly, for instance:

1. Tapung kanan guiding committee of occupational health and safety meetings on 10 Feb 2014, chaired by the chairman of guiding committee of occupational health and safety and was attended by 18 participants and on 13 Jan 2014, chaired by chairman of guiding committee of occupational health and safety and was attended by 18 participants

2. Tapung kanan guiding committee of occupational health and safety meetings on 7 Feb 2014 chaired by the chairman of guiding committee of occupational health and safety and was attended by 15 participants and on 10 Jan 2014, chaired by chairman of guidingcommittee of occupational health and safety and was attended by 11 participants.

Receipt for jamsostek payment on September 2013 is available. The payment was transferred to Bank Mandiri on 8 November 2013. For instance:

1. Company presents the receipt of jamsostek payment for 929 personnel (fix term personnel and daily worker) for death insurance, pension and work accident. The payment was transferred to Bank Mandiri, with account No. 88999.0000.0062.219 on 10 Feb 2014 and the invoice No. D0014020562 on 10 Feb 2014.

2. Company presents the receipt of jamsostek payment for 116 mill’s personnel for death insurance, pension and work accident. The payment was transferred to Bank Mandiri, with account No. 88999.0000.0062.219 on 10 Feb 2014 and the invoice No. D0014020449 on 10 Feb 2014.

The amount of payment is match with the number of personnel. Based on personnel data on January 2014, it’s known that the number of personnel in estate are 926 personnel (53 PBT, 406 SKU and 467 BHL) on January and 3 officers were resign in the end of January and mill (116 fix term personnel). The non-compliance CAR No. 2012.02 is closed.

Medical examination records:

1. Mill: examination on 29 Nov. 2013 in KTK (skin, abdomen, ear’s extremity, nose, throat, teeth examination, recommendation and summary) toward 10 personnel (welders, boiler operators, IPAL, Power House, laboratory and warehouse) by the laboratory Thamrin clinic in Pekanbaru. Examination on 11 Nov 2013 toward 11 personnel (warehouse officer, boiler operator, laboratory foreman, laboratory personnel and mechanic) covered the examination for eyes, skin, abdomen, ear’s extremity, blood and urine. The examination result mentioned that personnel are healthy.

2. KTK estate

KTK on 11 November 2013 for spraying and fertilizing, warehouse and chemical mixing officers: 21 personnel KTK II, 37 personnel KTK III, 37 personnel KTK I

KTK on 29 November2013 for spraying and fertilizing officer: examination for 32 personnel KTK II, for 27 personnel KTK III and34 personnelKTK I. the total number of high risk personnel, which have been examined are 188 spraying and fertilizing, warehouse and chemical mixing officers.

Non-compliance CAR No. 2012.11 is closed.

There is an evidence over the risk source analysis, such as:


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1. Tapung Kanan Estate. There is document of OSH hazardous source identification and risk analysis related to the estate activity, which was renewed on 20 December 2012. The identification over the source of hazard and risk analysis on the nursery, replanting, spraying, pest control, fertilization, road maintenance, transportation, the empty fruit bunches application, harvesting, workshop, diesel fuel warehouse and chemical warehouse, material warehouse, generator hut, housing and hazardous waste warehouse and office.

2. Tapung Kanan mill. There is document of OSH hazardous source identification and risk analysis related to the estate activity in the entire stations including the maintaining activity, workshop area, housing, office and warehouse laboratory (hazardous waste warehouse, hazardous waste and material warehouse), which was renewed on01 September 2013.


Records of the occupational health and safety (OSH) training:

1. The company has 2 paramedics who have followed the hyperkes training for paramedic. The training was conducted by UPT pusat hygiene Perusahaan Kesehatan dan Keselamatan Kerja of the manpower and transmigration agency of DKI province, Jakarta on17 – 21 December 2012. The ministry of manpower and transmigration in February 2013 issued the certificate. On behalf of: a. Supiani, A.Md. Keb (15.008/PM-I/13). b. Winda, A.Md. Kep (15.005/PM-I/13).

2. Training for transportation operator: Tapung Kanan Mill KTK

Name License/Certificate Valid until Operator

Edi P. 09.2115/OTC/KK/XI/2009 09 November

2014 Lift & Transport (OTC)

Edi Santoso M. 09.2116/OTC/KK/XI/2009 09 November

2014 Lift & Transport (OTC)

The company has registered 66 transportation operators to follow the OSH training for transportation operators. Such as:

Name License/Certificate Valid until Operator

Mardot M. 12.16024-OPK3-PAA/XI/2012 30 November

2017 Lift & Transport (Dump truck)

Tonang G. 12.16021-OPK3-PAA/XI/2012 30 November

2017 Lift & Transport (Backhoe Loader)

Frangki E. 12.16056-OPK3-PAA/XI/2012 30 November

2017 Lift & Transport (Dump truck)

3. Socialization / OSH training in work place

KTK 1. There is a socialization tape on the safe spraying training and OSH, which were attended by 12 personnel on10 June 2013.

KTK 2. There is an OSH socialization &Sopfor fertilization tape, which were attended by 13 personnel on 11 September 2013.

PKS. There is anISPO and PPEsocialization tape, which were attended by 17 personnel on19 October 2013.

The emergency response procedure is available for:

1. Fire, including the signs for fire, evacuation mechanism,handling mechanism and the emergency contact list. 2. Wildlife attack (in a form of Flowchart). 3. Leakage including the chemical/diesel fuel/ waste leakage and sign of event, the evacuation mechanism, handling

mechanism and emergency contact list. 4. Accident, including first aid, further treatment to the clinic, treatment to the hospital (if needed), the investigation,

report and emergency contact list


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5. Fire emergency response in the SOP RSPO 29. For estate including the sign of fire, fire extinguisherteam, the policy of fire restriction, maps of endangered area, water source and fire monitoring.

6. There is a disaster procedure, such as flood on 19/12/2012 that was endorsed by the senior manager. 7. There is an evacuation pathway and concentration point in the office, mill and housing.

Based on interview with mill and estate personnel as well as their wives, it’s known that they already understand about the emergency response procedure.

PPE provision record:

1. KTK 1. There is a record of the PPE provision for Mr. Jikun, the harvesting officer in division 2 B, such as the hand over of Helmet, boots, gloves, which were handed on 20 September 2013.

2. KTK 2. There is a record of acceptance of the PPE provision of Mr. Arifin, the harvesting officer in division 3A, such as the hand over of Bootson 05 October 2013.

3. Mill. There is a record of the PPE provision for Sulowiyoto, the foreman for shift process 1, such as the hand over of mask on 01 September 2013.

The company has given the facility and infrastructure to support each working unit, such as:

1. KTK. The Number of first aid boxes is 52 boxes (the contain of the first aid box is checked every month) and the number of fire extinguisher is 26 units. Being checked on 19 Feb 2014 and in the estate on 13 February 2014.

2. Hydrant 9 units inmill are checked on 17 February 2014. 3. Tapung Kanan mill. The number of first aid boxes is 12 units and the number of fire extinguisher is 24 units

and the hydrant as much as 10 spots. 4. Medical clinic, Ambulance and 2 paramedics.


Records of the first aid training in a work place:

1. KTK 1. There is a record on the first aid training, which was delivered by dr. Parulian (physician partner of the company) on 08 October 2012 and attended by 19 personnel (staff, maintenance foreman, harvesting foreman, mechanics, chief of production,and child care staff).

2. KTK 2. There is a record on the first aid training, which was delivered by dr. Parulian (physician partner of the company) on 11 October 2012 and attended by 11 personnel (harvesting foreman, maintenance foreman, staff, and child care staff).

3. Mill. There is a record on the first aid training, which was delivered by dr. Budianto Chandra (physician partner of the company) on 25 June2011 and attended by 7 personnel(mill’s foreman).

4. The training record in a form of information letter to 24 first aid personnel byPT Arpindo Pratama, which was conducted on 22-24 November 2013. For instance, the information letter No. 1060/SK-P3K/XI/13.

There is a recapitulation report of the work accident in 2014, which described the accidents’ analysis such as place and time of accident, personal detail of the victim, source of accident, the number of work hour loss, first aid, victim’s condition and recommendation. Non-compliance CAR No. 2012.04 is closed.

Based on field visit, the audit teams find some officers who not wear the PPE, for instance the harvesting officers. Regarding this finding, the explanation from the unit management was that the company has not provided the PPE for this unit work yet.

Minor 4.7.6 Status: Lihat CAR No. 2014.02

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

There is a training program for 2014, which completed with the training schedule, type of training, the trainee, and trainer and date of training. For instance:

Training plan and program in the mill for 2014: there are 7 type of trainings, such as: 1. Fire extinguisher simulation training and evaluation for the emergency response team by the assistant, which is

planned in Feb 2014 and has been implemented on 12 Feb 2014. 2. Training for work procedure, OSH and the PPE usage for the entire operators by the assistant and OSH expert,


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which is planned in June 2014.

Training plan and program KTK 1 for 2014: there are 10 type of trainings, such as: 1. Fire extinguisher simulation training and evaluation for the entire personnel by the assistant, which is planned in

Feb 2014 and has been implemented on 12 Feb 2014. 2. Training for harvesting technic for the entire harvesting personnel by the manager/assistant/staff, which planned

in February 2014 and have been implemented on 5-6 Feb 2014. 3. Training on spraying for spraying officers by manager/assistant/staff, which planned in April 2014.

There is a document of list of contractor, which explains contractor work experience and competency, such as: PT Anugerah Bintang Abadi contractor (factory contractor, civil engineering, etc.) has work experience for 10 years and CV Surya Kencana Sakti (Housing contractor, mechanic, procurement of goods and services).

There is a contractor Company Profile as a requirement from PT Sekarbumi Alamlestari on selecting the contractor, such as:

1. Company Profile CV. Manshuri (building contractor):

Trade business license (SIUP) for materials and services trade and general trade business/ procurement No. 503/KPT-SIUP/1026 on 03 May 2011.

Company’s registration No. 040834500603 on 24 April 2011 applicable from 1 January to 31 December 2012for business like: agriculture, general procurement, general trade, Real estate, Developer andpalm oil estate.

The member card of Indonesian construction company union, No. 04.1406-00112, on behalf of Ahmad Bukhori (Owner).

Certificate of construction business unit No. 00019271 on 06 February 2012 2. Company Profile PT. Anugerah Bintang Abadi, contractor for Boiler Vickers general service with a letter No. 04/ABA-

SA/II/14: PT. Anugerah Bintang Abadi has a decision letter as a service company for OSH No. KEP. 163/PPK-PNK3/VI/2010.


PRINCIPLE #5 Environmental responsibility and conservation of natural resources and biodiversity

5.1 Aspects of plantation and mill management, including replanting, that have environmental impacts are identified, and plans to negative impacts and promote the positive ones are made, implemented and monitored, to demonstrate continuous improvement.

There is no change in the scope of estate business specification, including the FFB processing capacity in Tapung Kanan mill, so there is no need to make a revision on the existing environment document. Based on interview with the management and observation in the field, there is no replanting activity. The company only has the replanting plan for 2017/2018.

Until the S-1 assessment activity, the company shows an environmental document such as the effort for managing the environment (UKL) and the efforts to monitor the estate environment (UPL) and palm oil management in Kota Garo village, Siak hulusubdistrict, Kampar district, Riau province, which drafted in February 1995. This document consists of the environment impact analysis for 6.200 hectare estate and palm oil factory with a capacity of 30 tones FFB/ha consists document is approved by the agribusiness agency – agriculture department of republic of Indonesia and approved by the environment unit through the letter No. B-5109/Dep.I/LH/07/2008 in 2008.

The periodic environment management activity is carry out to the government institution in a form of: 1) UKP - UPL 6 months report, which consist of the entire environment aspect including the social aspect such as the UKL-UPL semester 2 in 2013 report that has been submitted to the environment agency of kampar district, 2) report on the measurement of waste water quality and monitoring well every 6 months.

The company has done any replanting activity because the company only has a replanting plan for 2017/2018.


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


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In general the management of endangered and rare species as well as the high conservation value habitat has been identified and planned by the PTSA through: 1) UKL & UPL document, which are drafted in 1995, 2) analysis document of the high conservation value area has been done in September 2012, which refers to Toolkit HCV RSPO 2008. Some protected and identified species are: tiger, Sumatra elephants, tapir, trenggiling, dear, honey bear, root tiger; meanwhile for the identifiedHCV area in PTSA such as HCV 1, 3, 4, and 6 with a broad of 1.364,2 hectare.

Some protection steps for the HCV area and protectedspecies, such as: 1) the installation of HCV mark and the ban board for hunting, destructive fish catching and illegal harvesting, 2) information board of the protective species within the estate area, 3) the socialization of the SOP of protective wildlife managementtointernal and external stakeholder, 3) cultivation of hard wood in the HCV are. In general, these efforts are in accordance with the applicable regulation on wildlife protection and protective area.

Field assessment presents that for the socialization need, PTSA has installed the ban board regarding the protected species (11 ban boards in HCV area and 8 band boar on the wildlife protection) and makes leaflet to internal and external stakeholders even though the quantity is still limited.

To monitor the HCV management, PTSA has had 2 staffs: 1) Ali Nurdin (manager assistant) as HCV coordinator and 2) Edi Syahputera (manager assistant) as HCV coordinator assistant. Both staffs have received the internal training regarding the HCV in 2012.

To improve the competency of HCV staffs, PTSA plans to conduct training on the management of high conservation value area by third party, inAugust 2014. Meanwhile for replacing the type of protected wildlife’s signboards will carry out in June 2014.

Based on field visit to Sepano river (KTK 2 Div 3A), Paloge (KTK 3), Tapung river (KTK 3 Div 4 A), and Sepahat river (KTK 1 division 2A and 2B), it’s known that there are some efforts to manage the HCV, such as: the installation of HCV existencesignboard, the riparian area’s marking with a red color, restriction to use chemical material on riparian area and forest replanting such as waru and bamboo to avoid the erosion. Based on public consultation with the community in Kota Garo and Kota Bangun village, it’s known that the company has conducted the socialization on the HCV area as well as type of wildlife and protected plantation.


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

The company has had the identification document for the source of waste and pollutions, as well as the plan to reduce the pollution. For instance:

Tapung Kanan estate 1, 2, and 3

Hazardous waste (LB3)for instance: used oil, used filter, used accumulator, used bulb, majun fiber, used pesticide packages, which are stored in temporary hazardous waste landfill and transported by the licensed contractor.

Clinical waste are stored in the hazardous waste landfill and transported to the licensed incinerator operator.

Domestic waste will be sent to landfill

Used tires will be handed over to the supplier.

Tapung Kanan Mill

The licensed contractor will take hazardous waste, for oil leakage will be kept in the leakage pond.

Liquid waste from mill will be used for Land Application

Empty fruit bunches will be applied in the estate to reduce the usage of chemical fertilizer.

Smoke and dusty are managed with monitoring and evaluation to ensure the solid particles are in accordance with regulation.

Fiber and shell will be used as boiler’s fuel; boiler dust will be applicator to the palm oil estate.

Domestic wastes are transported regularly to landfill in each divisions, further to be buried in TPAS

Regarding the hazardous waste management and agrochemical waste, the company has had the SOP RSPO 17 about the hazardous waste management. Agrochemical waste such as patricide packages will be managed in accordance with the


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applicable regulation (PP No. 18 in 1999), which is stored in the temporary hazard use waste and poisonous waste landfill from related institution in KTK 1 estateand Tapung Kanan POM. The company also has a cooperation with the licensed contractor from the ministry of environment to collect the entire hazardous waste, which is PT Primanru Jaya

The company able to present the waste monitoring analysis, for instance:

Hazardous waste balance for period November 2013 until January 2014 for hazardous waste landfill in KTK 1 estate, with detail: 1000 liter of used oil, 64 kg of used filters, 7 units of used accumulator, 6 kg of majun fabric, 14 kg of contaminated packages

Hazardous waste balance for period November 2013 until January 2014 for hazardous waste landfill in Tapung Kanan POM, with detail: 580 liter of used oil, 22 units of used filter, 5 units of used accumulator, 6 units of used bulb, 0.5 kg of majun fabric.

There is a three-months report of hazardous waste for Tapung kanan mill, for period November 2013 to January 2014 to the environment agency of Kampar District on 14 February 2014

There is a three-months report of hazardous waste for KTK 1 estate, for period November 2013 to January 2014 to the environment agency of Kampar District on 15 February 2014

Based on field observation in hazardous waste landfill in Tapung Kanan mill andhazardous waste landfill in Tapung kanan 1 estate, it’s know that the entire hazardous waste management is in accordance with the applicable regulation, there is no hazardous waste being stored that exceeding the shelf life and the hazardous symbols are well installed.


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

Some efforts from the company to reduce the emission from the diesel fuel are by substituting the diesel fuel usage with the renewable energy usage such as shell and fiber. The company has prepared the monitoring for renewable energy usage from 2009 to 2013, and it’s know that:

The efficiency of shell and fiber’s usage from 2012 to 2013 in Tapung Kanan mill is quite stable with an average of 4793.82 MJ/tonesFFB for shell and 5221.72 MJ/tonesFFB for fiber.

From 2012 to 2013, the company is success to save the diesel fuel usage by substituting with shell and fiber. This can be seen on the diesel fuel usage, which is quit stable and the average is about 6.17 l/tones CPO from October 2012 to September 2013.

For the renewable energy usage like shell and fiber as well as the efficiency calculation, PT SBAL has no target or even achievement standard, because the usage of shell and fiber is quite fluctuate, which based on the processed FFB.


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

There is an SOP 04 about replanting, which is endorsed by the Senior Manager (Ng Yee Hong) on 12 April 2012. This SOP explain:

Land clearing is based on the environment endorsed analysis (AMDAL/UKL-UPL) result.

Make sure that there is no fire for replanting activity “Zero Burning”

PT SA plans to do the replanting inbudget period of 2017/2018

There is an area with a planting year of 2010 in KTK I Division 2B, which covers an area of 54 Ha. There is an SPK for land preparation bystackingfor Division 2B that is in accordance with the Addendumof SPK such as on behalf of LONGSEEN and PT Sekarbumi Alamlestari No. 006/ADD-SA/KTK-LS/IV/2010 on 29 April 2010. There is a ban board to set fire in the area of PT Sekarbumi Alamlestari such as in staff’s housing and landfill.

The company has had the emergency response for estate and mill. The evacuation pathway is available, the concentration point and emergency layout such as evacuation pathway in

KTK 1 office, KTK 2 office and in the housing.


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There is also an evidence on the emergency response training, for instance:

Record of fire extinguisher training in KTK 2 on 05 November 2012, which was attended by 5 participants.

Simulation record and the establishment of fire evacuation team, which were conducted in Tapung Kanan mill on 02 July 2013 and were attended by 18 participants.

Simulation for fire emergency response, evacuation and transportation on 12 Feb 2014, which was attended by 12 participants(emergency response team of KTK I).

Theoryand practice for fire extinguisher from PT Tri Mas Ekatama on 14 Nov 2013, which was attended by 37 participants.

There is a fire monitoring record that stated in the monthly checklist record for fire prone area. Based on public consultation result with stakeholders, there is no issue on fire and the usage of fire by the company.

The company has the tool and infrastructure to control and tackle the fire. For instance:

1. Tapung Kanan Estate Fire extinguisher equipment

Fire extinguisher equipment Total

Jhondere 1 unit

Trailer 2 units

Extinghuisher tank 4 units

Shibahura machine type TF516MH

1 unit

Kohler machine 1 unit

Robin machine 1 unit

Stick 2 1 unit

Suction hose 3” 3 rolls

Hose 2” 10 rolls @ 20 meters

Hose 1,5” 11 rolls

Stick 1,5” 1 unit

Glasses 12 units

Yellow helmet 12 units

Fire extinguisher / APAR

Fire extinguisher/ APAR

KTK 1 KTK 2

19 units in a good condition 7 units in a good condition

2. Tapung Kanan Mill

Fire extinguisher equipment


APAR 24 units

Hydrant 10 spots

Sand 6 spots

There is evidence on the monthly monitoring of fire extinguisher tools. Based on field visit, the facilitiesand infrastructure are adequate and ready to use in case of emergency.


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

The company able to presents the identification document of pollution and emission sources in the mill in a form of matrix with a title: “Identification of pollution and emission sources and the pollution reduction plan”. This document mentions that there are around 19 items of waste and pollution in the mill as well as the estimation of their volume. The emission and pollution, such as:


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Smoke from boilers

Smoke from generator

Dusk from boilers’ chimneys

Metane gas from waste ponds

Liquid waste

Domestic liquid waste, etc

Based on the RKL/RPL report on semester 2,2013, it’s known that the company has conducted the examination and regular monitoring over the air emission’s quality and ambient from the operational activity, for instance the air emission from generator where the entire examination parameters are not exceeding the quality standard threshold (SO2 = 211.5 mg/Nm3, CO = 154.3 mg/Nm3), boiler air emission, which the entire examination parameters are not exceeding the quality standard threshold (particle = 168.2 mg/m3, SO2 = 44.50 mg/m3, capacity = 22.5 mg/m3).

Regarding the management of liquid waste, the company has had the SOP 18 about the mill’s waste management, based on this SOP, the mill’s liquid wastes are managed with the IPAL system before distributed to LA trenches and the quality of wastewater should comply the applicable environment regulation. There is also POME SOP, which explains the number of IPAL ponds, waste steam, duration of retention, waste water sampling spot, land application, the monitoring system for the quality of waste water.

The entire wastes water are managed in the IPAL ponds in the mill before used, the waste are processed until reach the waste water standard quality in the palm oil estate, which is ph 5-9 and BOD≤ 5000 mg/l. The wastes water the outlet of IPAL ponds further be pumped and distributed to the location of wastewater utilization in the soil. The entire operational activity to process the wastewater has been reported in a form of three-months report of the wastewaterOctober 2013 to December 2013 to the environment agency of Kampar District on 3 February 2014.


PRINCIPLE #6 Responsible consideration of employees and of individuals and communities affected by growers and mills

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 the continuous improvement.

PT Sekarbumi Alamlestari has had the document of environment and social impact assessment, which consist of:

1. The UKL / UPL document in the early estate clearing, which drafter by the consultant.

2. The document of environment and social impact assessment, which drafted on September 2012 with assistance from the third party (Aksenta consultant). The document of environment and social impact assessment explains the general description of the area, stakeholder’s analysis, positive and negative impact of the estate, social issue in the internal part of company and how to deal with it, social issue/ external impact and company’s action, recommendation over the conflict management and other aspects.

PT Sekarbumi Alamlestari has had the management and monitoring plan: community empowerment program (CSR) in 2012 – 2015 and management and monitoring program to manage the physical and social environment in 2012 – 2015.

Until now, there is no expansion over the estate area (6.200 Ha) with palm oil mill’s capacity of (30 Tones FFB/ Hours). The company has reported regularly the implementation of RKL & RPL to the environment agency of Kampar District;there is a receipt of the implementation of RKL &RPL report Semester 2,2013.


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.

During the surveillance 1, SOP 19. Communication, Consultation and socialization with stakeholders have no revision.

Based on document’s review, PTSA has conducted the socialization to stakeholders, for instance:

Socialization on 16 October 2013, in head of Kota Baru village office regarding the ISPO, which covers the


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information request procedure, complain mechanism and conflict resolution mechanism. Village secretary and representatives from company attended this socialization.

Socialization on 14 October 2013 in head of Tri Manunggal village office regarding the ISPO, which covers the information request procedure, complain mechanism and conflict resolution mechanism. Head of Tri Manunggal village and representatives from company attended this socialization

PTSA has had the stakeholder list: 16 corporations, 3 units of worker union, 10 hospitals, 4 buyers, 6 car services, 2 units of electronic and other amount 89 units, smallholder/village/local communityamount 12 units, 1 contractor, 4 NGOs and 2 security.

There is a documentation for the grant request on 17 February 2014 from Mr. H. Ilyas, S (Head of Kota Garo Village) with a letter no 440/KG/THR/2014/007 regarding the lend of heavy equipment such as road grader to flattening the soccer field in sub village III Kampung Baru, and PTSA has granted this request on23 February 2014 based on document/ report of the heavy equipment work. Based on document’s review on the surveillance 1, there is no information/complain/grant response that exceeds 15 days.

Based on document’s review, thereare an additional person in charge on the consultation and communication withthe community, based on the “person in charge for the RSPO aspect” document, which has approved by Mr. Chong Kong Fat (Mill Controller), such as explains that Mr. Hendy W and Mr. Supramaniam are person in charge for the consultation and communication with the community in Tapung Kanan mill. Meanwhile for estate unit, person in charge is the manager in each estate; this is based on the decision from Mr. Ng Yee Hong (Senior Manager).


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

To handle complain and conflict, the company has had some SOP, such as:

- SOP 2. Land acquisition and compensation - SOP 20. Complains and objections handling procedure - SOP 26. Conflict resolution procedure - SOP 27. Land acquisition and compensation

There is an HGU area in Block 99 H, which claimed by some community. Community has submitted their objection PT SA. Based on Bangkinang state court decision No. 36. /Pdt.G/2009/PN.Bkn on 20 April 2010, the objection is refused. But actually the company can manage this area because some people from the local community still using this area as their plantation area (as the community reject the court decision). There is no evidence on complaint/objection response over this problem.

Non-compliance, please refers to CAR No. 2014.01

Minor 6.3.1 Status: Non Compliance

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.

PT Sekarbumi Alamlestari has had the land acquisition and compensation (SOP No.2). This procedure explains:

Area/land identification that will be released by the coordination with community figure.

Study the legality and administrative aspect of the land

Study the agreement document between land’s owner and company.

Study the fact over the released land

Providing compensation in accordance with the agreement.

Provide notes/ formal letter of the land release for state land, indigenous land, village land, and personal land.

Land compensation request

Assessment and verification on the payment receipt

Supporting document for hand over of the land which known by government officer, minutes of location review,


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minus of land measurement, compensation payment receipt.

Steps of compensation payment to the land owner, such as:

Identification of the landowners. There is a sample of land inventory list, plantation and other business related to the land acquisition for PT SA, for instance the letter No. 05 on 14 May 1991 on behalf of Sidal (40 years old) in Sekijang village Siak Hulu district for 2 Ha, type of plantation (rubber tree: 13 trees), which are well maintained. This data is approved/ accepted/corrected by the owner; company’s representative; regency officer; estate agency officer;dispera officer; district officer and village officer. Negotiation with the land owner There is a sample of the record of land, for instance receipt on behalf of Sidal from Kota Batak village. This letter explains that by signed this letter, the land owner has released his right over the land of 2 Ha and released the government c/q land acquisition committee in Kampar district as well as PT Sekarbumi Alamlestari from any other type of charge in the future. Compensation to the landowners. Sample of land compensation, such as:

Compensation receipt over the land, No. 001/I/SBAL/92 for a land of 2 ha, including the plantation and building in the land, which will belong to PT Sekarbumi Alamlestari in Kota Batak sub village (Kota Aman) Sekijang village on behalf of Sidal in January 1992.

Compensation receipt from PT. Sekarbumi Alamlestari, on behalf of Sidal from Kota Batak sub village that he had received the compensation from PT. Sekarbumi Alamlestari, which is in accordance with the receipt No. 001/1/Sbal/92 over the 2 Ha land.


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

PT SA applied the wage based on the regional minimum wage guidelines (Governor regulation No. 16, 2013) amount IDR 1,509,000 per month = IDR. 60.350/day. Wage for 2014 not yet issued.

There is a circular letterfrom the director of PT SA on 18 April 2013 No. 002/SA/Edar/IV/2013 regarding the new wage for daily workers:

1. SKU wage Idr. 1.509.000/month orIdr. 50.300/day not include the rice allowance, which is in accordance with the family status of the employee (minimum rice allowance for single employee is 15Kg).

2. Wage for daily workersIdr. 1.626.000 per month or amountIdr. 65.040, -/ day

In accordance with the circular letter GAPKI No/144/GAPKI/R/III/2013 on 18 March 2013 regarding the agreement letter over the minimum wage for the agriculture/plantation sub sectorin 2013.

There is a salary slip, which presents the list of main salary, overtime, premi (generator, spray, attendance, mandah, fertilizer transporting, land clearing, diligence, bulldozer work, group leader, etc.). Deduction for the social insurance/ jamsostek 2%, PPh, loan etc. This shows that the wage is in accordance with the regional minimum wage. Based on interview with some personnel in the estate and mill, the personnel mention that they receive a decent wage.

The company has the company regulation and collective work agreement:

Company’s regulation PT. Sekarbumi Alamlestari in 2012-2014 based on decision letter from head of social and manpower agency in Kampar District, No: KPTS.560/DSTK-PP/2012/004, which endorsed on14 March 2012 and valid for 2 years (14 March 2014).

Collective labor agreement between BadanKerjasama Perusahaan Perkebunan Sumatera (BKS-PPS) andPengurus Pusat Federasi Serikat Pekerja Pertanian dan Perkebunan Serikat Pekerja Seluruh Indonesia (PP.FSP.PP-SPSI). PT Sekarbumi Alamlestari is a member of BKS-PPS since 1 November 1995. Collective labor agreement is registries in accordance with the decision of general director industrial relation and manpower social insurance agency No. KEP.191/PHIJSK-PKKAD/PKB/XII/2012 that valid from 14 November 2012 to13 November 2014.

There is a socialization record for the collective labor agreement on 11 October 2013 in Division 2A, which was attended by


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54 personnel.

There are several tools and infrastructures for personnel welfare, such as:

Clinic, 1 unit.

Child Care, 3 units.

Kota Garo Elementary School and junior high school in Kota Garo, Kota Baru, Kota Bangun, Alamanda, SMK Kota Garo, Kota Bangun and Alamanda senior high school. The company provides 5 units of school bus

Ambulance 1 unit.

Personnel housing: 638 units, number of estate personnel 401 and mill 116, wife of officer 1 person, single 3 persons. So the numbers of houses are sufficient. Mosque: 1and small mosque: 7

Rain house: 6 units

School bus: 4 units.

Based on field visit and interview with personnel in estate KTK II, the audit team found information that the entire SKU andBHL personnel got the adequate housing facility.

Contractor agreement letter, for instance: work agreement number. 007/SA-PKS/ABDI/IX/2012 with PT.Anugrah Bintang Abadi on 8 September 2012 for type of works:Upkeep Mill Building (replace roofing at Press station, Sterilizer station, Boiler station, Capstand station and Bogies building). Article 6 mentions that the second party is responsible to take the risk over personnel, transportation, personnel safety and health (Astek)”.

The agreement with the contractor requires the contractor to fulfill the safety regulation, manpower and environment regulation, such as:

- Personnel are mandatory to prioritize their safety

- Personnel must equip with the appropriate PPE.

- Hazardous waste (used oil) should be collected and transported to SA company

- Personnel must have insurance, their wage should be in accordance with the regional minimum wage, have experiences and well trained.

Disobedience on the above requirements can lead to the termination of the contract.


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.

PT Sekarbumi Alamlestari has a policy on the freedom to join worker union, which endorsed by the Regional Director on 1 October 2011. The company should offer freedom to join worker union based on the applicable law. The policy is distributed in accessible are such as in the information board.

Interview result with SPSI PT SA committee reveals that the company has implemented it’s policy and provide freedom to its personnel to establish worker union, eventhough the worker union activities in PT. SA are limited on internal meeting which discuss the election of SPSI pleno board, new recruitment and the socialization of PT SA board. The meetings were not discus the issues or complaint from PT SA personnel.

Based on interview with personnel in mill (workshop, kernel and boiler personnel) and Estate KTK-1 and KTK-2 (foreman andmaintenance and harvesting personnel) its known that the personnel are free to join the worker union.

There are some records on the SPSI PT SA meeting, such as:

1. SPSI meeting in compound room of PT SA with a topic about the election of SPSI pleno board, which conducted on 11 May 2013, and completed with the minutes of meeting and attendance sheet with the number of participants are 29 persons.

2. SPSI meeting in compound room of PT SA with a topic about board coordination meeting, which conducted on 23 May 2013, and completed with the minutes of meeting and attendance sheet with the number of participants are 13 persons.

3. SPSI meeting in compound room of PT SA with a topic about additional and recruitment of SPSI new member, which conducted on 17 October 2013, and completed with the minutes of meeting and attendance sheet with


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the number of participants are 23 persons. 4. SPSI meeting in compound room of PT SA between SPSI board and company’s representative, which

conducted on 28 November 2013 with a topic ofsocialization of SPSI PT SA board, and completed with the minutes of meeting and attendance sheet with the number of participants are 8 persons. (Completed with photos).

Non-conformity CAR No. 2012.08 is closed.


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 program. Children are not exposed to hazardous working conditions.

There is a policy about children on 01 October 2011, which handle by Director (Tan conformityand mentions thatthe company commits not to hire childrenless than 18 years old.

There is an SOP 21. Management and personnel on18 December 2012, which signed by the Senior Manager (Ng Yee Hong).The available information such as the requirement for personnel recruitment:

Minimum age for personnel is 18 years old

Personnel personal data should be well reviewed.

There is a list of personnel per October 2013, which shows personnel’s name, sex, status, ethnic, religion, date of birth and date of entry. Based on document’s review over PT Sekarbumi Alamlestari personnel data, its know that the youngest staff is Erly Adri (NIK. 362 harvesting officer) date of birth 25 May 1995 and date of entry 21 July 2013 (age when hired by the company was 18 yearsand 2 months). Based on field observation and interview with mill’s personnel (boiler operator, engine room operator, WTP) and estate personnel (warehouse officer, spraying officer, fertilizing officer, empty fruit applicators and harvesting officer)there are no personnel under 18 years old.


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.

There is a policy on the fair treatment and probability for employment, which signed on 01 October 2011 by Director (Tan Kei Yoong). The policy mentions that the company always fair on treatment with no discrimination over race, ethnic, social status, nations, religion, gender, sexual orientation and membership.

There is a SOP 21. Management and personnel on18 December 2012, which signed by Senior Manager (Ng Yee Hong). The available information such as the requirement foe personnel recruitment:

There is no discrimination toward personnel based on nations, social status, nationality, religion, disability, sex, sexual orientation, worker unit, political party and age.

In case of daily workers, the practices are no discrimination, no contract change, orientation program related to language, security, manpower’s regulation, local culture, etc.

The company has identified a number of personnel who work more that 21 days for 3 consecutive monthsare 169 personnel. Another BHL difference that work les than 21 days, regarding this issue, the company has recruit 169 personnel for 5 months (Jan-May 2014). Realization of current recruitment is: 85 personnel are hired and 1 personnel has resign. The company shows the document of hiring daily worker to be fixing term worker based on work performance. For instance the recruitment onJanuary 2014 for amount 60 personnel; the hiring letter SKU No. 04/KTK-SA/SKU/1/2014 and sample of fix term service/work contract No. 004/KTK-SA/I/2014.There is a result over personnel performance evaluation for period 2012-2013 No. 035/FM-SA/TKF/II/13. Non-compliance CAR No.2012.15 is closed.

Based on field observation and interview with mill’s personnel (boiler operator, engine room operator, WTP) and estate personnel (warehouse personnel, spraying personnel, fertilization personnel, empty fruit bunches applicators, harvesting personnel) there is no discrimination to personnel. Placement and personnel promotion are based on work performance.


6.9


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Policy to prevent sexual harassment and all other forms of violence against women and to protect their reproductive rights is developed and applied.

There is a policy on sexual harassment and abuse that signed by Tan Kei Yoong on 1 October 2011:

The company has no tolerance on sexual harassment and sexual abuse toward female personnel in work place.

Sexual harassment and abuse are type of major mistake and the company will give an assertive action toward its perpetrator.

The management should set an example and take responsibility as a role model and prevent the sexual harassment and abuse.

There is a policy on female reproduction right, which signed by Tan Kei Yoong on 1 October 2012:

The company will obey the entire regulation and requirement related to reproduction right.

Gender committee will be established to implement and monitor this policy.

There is an SOP 21. Management and personnel on18 December 2012, which signed by Senior Manager (Ng Yee Hong).The available information, such as:

Maternity Leave – Every female worker has a right for the maternity leave (1,5 monthsbefore laborand 1,5 months after labor)

Lactating female worker is forbidden to do the work related with chemical material.

Menstruation Leave– Every female worker has a right to take 2 days leave, which should be based on the recommendation from the clinic.

There is a gender committee, which chair by Holidina Fiddin S and has been endorsed bySenior Manager (Ng Yee Hong). The gender committee member is available in each representative division, KTK office and mill office.

There is a menstruation leave (h1) and pregnancy leave(H2)that available in POM PT Sekarbumi Alamlestari and Tapung Kanan estate PT Sekarbumi Alamlestari. For instance, the examination of Mrs. Yulinawati, fertilization officer KTK I Division 1B on 04/01/2012 is positively pregnant and Mrs. Temu, spraying officer KTK II Div. 3 B. Company’s action is to transfer her to Turnera maintenance. Based on interview with Mrs. Yulinawati (fertilization office KTK 1 Div. 1 B) it’s known that the company has set the policy such as providing (leave, transfer, restriction for pregnant and lactating female worker to work with chemical material)

There is a special complain mechanism such as SOP 25. The sexual harassment procedure, which approved by the Senior Manager (Ng Yee Hong) on 12 April 2012 and describe about:

The victim and witness should report the assault to the gender committee or company.

The report can be done in estate/mill area or outside the estate/mill area.

The report will be kept confidentially.

The gender committee and gender committee member will examine the sexual harassment/ abuse report as soon as possible.

Disciplinary actions will be taken if the suspect is finding guilty.

Based on field observation and interview with female personnel (spraying and fertilization personnel), there is no issue related to sexual harassment and personnel know about the gender committee.


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

PT Sekarbumi Alamlestari has had the cooperation with local smallholder through plasma smallholder’s program. There is a colective aggrement for FFB trade No.01/SA-IPS/X/2006, on 2 October 2006 between PT.Sekarbumi Alamlestari (Rudy Tantono / operational director) and palm oil smallholder cooperative of kota Garo on behalf of Sulaiman. The collective agreement consists of:

a. The IPS cooperative party is willing to supply the FFB from community’s estate in Kota Garo village everyweek ± 50 tones.

b. The FFB price is based on the weekly FFB price that issued by the estate agency. c. The payment method is done every week after the capital office has received the FFB weighing receipt.


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d. The FFB criteria should be in accordance with mill’s need.

The payment for FFB from KKPA smallholder is done by PT Sekarbumi Alamlestari every end of month. There is a document of the “KKPA” FFB price on January 2014 and the total payment isIdr. 2.475.455.850,30.

Partnership with local contractor, for instance there is an agreement/ work contract with the contractor, number: 007/SPK-KTK/BGN-BHR/VII/2012, on 20 July 2012 between coordinator managerof PT Sekarbumi Alamlestari – U. Sembiring (first party) and A. Bukhori – local contractor (second party) for personnel housing establishment, housing Type G2 which located in KTK II & KTK III estate. The contract explains the work safety and accident aspect a well as the payment requirement. There is an payment receiptnumber: 381/SA-UM/XII/2012, on 22 December 2012 from PT Sekarbumi Alamlestari to A. Bukhori forhousing establishment work, housing Type G2, which located in KTK II & KTK III estate, total payment is Idr. 395.480.000


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

There are some contribution record from the company, such as:

a. Realization of Corporate Social Responsibility in 2013, consist of:

Community welfare

Infrastructure and building

Education

Charity

Others Total Idr: 114.820.000

b. The CSR program in 2013/2014 (budget from October 2013 – September 2014), consist of:

Social welfare&community

Infrastructure and building

Education

Sport

Charity

Celebration Total Idr: 49.600.000

c. Payment receipt for tax on behalf of PT Sekarbumi Alam Lestari for taxpayer in Kota Garo village, Tapung Hilirsub district, Kampar district for 62.000.000 (62 Ha) land & 20.970 M2 building, total payment Idr. 921.116.620, therealso a payment receipt of the Pajak Bumi dan Bangunan (SSP PBB), which paid through Bank Riau Kepri on 16/10/2013.


PRINCIPLE #7 Responsible development of new plantings

7.1 A comprehensive and participatory independent social and environmental assessment is undertaken prior to establishing new plantings or operations, or expanding existing ones, and the results incorporated into planning, management and operations.

Until the S-1 evaluation, there is no change on the operational activity; the board of estate and the capacity of mill are staying the same. The cultivation is carried out gradually, mostly cultivated in a period before November in 2005, and only small part of the plantation that cultivated after November 2005. Because there is no substantial change in the area and estate operation, the environment document that drafted in 1995 (UKL-UPL) remains as a guidelines and supported with the social impact analysis, which drafted in 2012.

Based on the applicable regulation and environment-monitoring plan in UKL UPL in 1995, PTSA has done the monitoring and periodic environment management as well as report the result to local environment agency every 6 months. For instance, regular environment management report in a form of UKL/UPL semester II reports in 2013 to the environment agency of Kampar District on 10 February 2014. The RKL/RPL report contains the management and monitoring actions that have been taken by the company:


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The quality of air emission and ambient, as well as the vibration

The quality of water in tapung river

The quality of water in monitoring well

The quality of liquid waste in land application


7.2 Soil surveys and topographic information are used for site planning in the establishment of new plantings, and the results are incorporated into plans and operations.

PTSA not establish and extend its estate in the outside of HGU.

There is palm oil cultivation area after November 2005, which is cultivated in 2006 for amount 48 Ha (38 Ha di KTK-1 and 10 Ha in KTK-3 ex nursery) and in 2010 for about 54 Ha (KTK-1), there is no cultivation in the HCV area.

There is a soil map (nucleus and KKPA) with a scale of 1:100.000 (datum WGS84) made by PT. AAR.

The existing drainages are: Well drained, moderately well, poorly drained, imperfectly drained, and very poorly drained. The majority iswell drained.

Meanwhile for the fertility status such as: very low, low, medium, high and very high. The major majority is low.

Because of the fertility limiting factor, the company makes the SOP 12for optimum soil fertility management for the productivity, which approved by Senior Manager (Ng Yee Hong) on 12 April 2012 and describe:

Marginal soil management – sandy, law organize material, podzolik, peatlands

Application technic such as empty fruit bunch application for sandy area, law organic material and silt pit for podzolik soil

For peat land: there is a water surface management, water gate/dam to control the consistency of water level between 50 and 75 cm below the surface water such as agronomic guidelines.

Checklist for monitors the water gate and trenchcondition.

Monitor the level of surface water in water gate and reservoir channel.

Pearland map.

No cultivation in peat area that more than 3 m

To flow the exceeding water during the rainy season

Zero burning

The application of CuSO4, ZnSO4to cover the lack of trace element.

Trench wash


7.3 New plantings since November 2005, have not replaced primary forest or any area required to maintain or enhance one or more High Conservation Values.

In general, the cultivated area by PTSA is in accordance with the area allocation because still covered in the HGU, which issued by the national land agency in the early stage of estate development. Moreover, the cultivated area since 2005 is not a new area and still covered in the environment and social impact assessmentscope (UKL/UPL) as well as the analysis of the Social Impact Assessment.

UKL UPL document identified that the PTSA estate us not opened in the main/primary forest. In addition, through the overlay of cultivating year with the identification map of HCV spread, its known that the cultivation area since November 2005 was not conducted in the identified HCV area. Some area with palm oil plantation in the riparian area has been pointed as an HCV area and treated as a chemical free area.

Based on visit to the planting area in 2010, which located in the KTK 1 Division 2B block 10A and 6A, its known that the area is neither located neither in the main/primary forest nor in the HCV area.


7.4 Extensive planting on steep terrain, and/or on marginal and fragile soils, is avoided.


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Based on topography map, in general its known that PTSA is on the low area along the Tapung river. Tin general the topographyis considered flat with a minimum wave in same areas in KTK 1 division 2A. Field evaluation shows that there is no land area with an extreme slope (>40%) with a significant broad that can make erosion. In some small hills along the river have been treated as sedimentation bucker (rorak) and midrib arrangement in parallel with the contour.

From field assessment and soil map review, its known that some part of the estate has sandy area like in KTK 1 division 2 A and 2B. On this land, there is probability of high erosioneven though the slope is not too high. For this erosion potential area especially in the riparian area, PTSA has conducted the enrichment effort by cultivating the bamboo and waru trees and no chemical material application.

Based on field visit, the companies have cultivated forest trees in DSS as a protection over the availability and water quality as well as prevent the erosion and sedimentation. But the success level/ prosentation on the cultivated plantation is quite low, which is less than 50% because of the flood. According to the HCV coordinator as a person in charge to the DSS management states that thereplanting for the dead plantation will be conducted during rainy season and a more intensive management.


7.5 No new plantings are established on local peoples’ land without their free, prior and informed consent, dealt with through a documented system that enables indigenous peoples, local communities and other stakeholders to express their views through their own representative institutions.

Until now, PT Sekarbumi Alamlestari makes no extension of new estate on the outside of HGU area, which is 6.200 Ha. The socialization for opening the estate is done in the early stage of estate development and the compensation has been done (has been explained in the minor indicator 6.4.1, Minor 6.4.2 &Minor 6.4.3).


7.6 Local people are compensated for any agreed land acquisitions and relinquishment of rights, subject to their free, prior and informed consent and negotiated agreements.

Until now, PT Sekarbumi Alamlestari makes no extention of new estate on the outside of HGU area, which is 6.200 Ha. There is a record over the identification result on compensation receivers on the early stage of estate development:

For instance:list of inventory for the land, cultivation and other business in order to release the land for PT SA, such as letter No. 05 on 14 May 1991 on behalf of Sidal (40 years old) in Sekijang village, Siak Hulu sib district amount 2 Ha, consist of 13 tress of well maintain rubber. This data is approved/accepted/received/corrected by the owner; company’s representative; land agency’s officer; regency officer, estate agency officer; dispera officer; subdistrict officer and village officer.


7.7 Use of fire in the preparation of new plantings is avoided other than in specific situations, as identified in the ASEAN guidelines or other regional best practice.

There is an SOP 04 about replanting that approved by the Senior Manager (Ng Yee Hong) on 12 April 2012, which describes:

Land clearing based on the environment impact analysis (AMDAL/UKL-UPL)

Zero burning during the replanting.

PT SA has a plan for replanting forbudget period of 2017/2018

There is an area with a planting year of 2010 in KTK I Division 2B for about 54 Ha. There is an SPK for land preparation by stackingfor Division 2B that in accordance with theAddendum SPK between An. LONGSEEN and PT Sekarbumi Alamlestari No. 006/ADD-SA/KTK-LS/IV/2010 on 29 April 2010. There is a ban board to burn within the area of PT Sekarbumi Alamlestari such as in personnel housing and landfill.

The company has had the emergency response for estate and mill. There is an evacuation pathway, concentration point and emergency layout for instance the evacuation pathway in KTK 1 office, KTK 2 office and in residence.

There is also an evidence for the emergency response activity, such as:

There is fire extinguisher training in KTK 2 on 05 November 2012, which attended by 5 participants.


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There is a simulation record and establishment of fire evacuation that conducted by Tapung Kanan mill on 02 July 2013, which attended by 18 participants.

Fire emergency response simulation, evacuation and transportation on 12 Feb 2014, which attended by 12 participants (emergency response team of KTK I).

Theory andpractice for fire extinguisher from PT Tri Mas Ekatama on 14 Nov 2013, which attended by 37 participants.

There is a record for fire monitoring, which stated in the monthly record of monitoring checklist for prone area areas.

The company has facilities and infrastructure to control and tackle fire, for instance:

1. Tapung Kanan Estate Fire extinguisher equipment


Jhondere 1 unit

Trailer 2 units

Extinguisher tank 4 units

Shibahura Machine type TF516MH

1 unit

KohlerMachine 1 unit

Robin Machine 1 unit

Stick 2 1 unit

Suction hose 3” 3 rolls

Hose 2” 10 rolls @ 20 meters

Hose 1,5” 11 rolls

Stick 1,5” 1 unit

Glasses 12 units

Yellow helmet 12 units

Fire extinguisher equipment/ APAR

Fire extinguisher equipment / APAR

KTK 1 KTK 2

19 units in a good condition 7 units in a good condition

2. PKS Tapung Kanan



Total

APAR 24 units

Hydrant 10 spots

Sand 6 spots

There is evidence on the monthly monitoring of fire extinguisher tools. Based on field visit, the facilities and infrastructures are adequate and ready to use in case of emergency.


PRINCIPLE #8 Commitment to continuous improvement in key areas of activity

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


ASSESSMENT REPORT


The company has made a plan to reduce the usage of paraquat in a monitoring document of paraquat dichloride usage for 5 years, which approved by the general manager. In 2013, the usage of paraquat is planned to reduce by 10% or about 6,241 liters and in 2014 is targeted to use 5.548 liters of paraquat, in 2015 is targeted to use 4,855 liters of paraquat, in2016 istargeted to use 4.162 liters of paraquat, in2017 istargeted to use 3.469 liters of paraquat.

Environmental Impact:

The company establishes the HCV training program by third party in August 2014, to improve the manager/assistant/HCV officer’s understanding on managing and monitoring the HCV area. Moreover, the company also has a program to repair the HCV signboard, type of protected wildlife, DSS painting in June 2014.

Social Impact:

Improving/repainting personnel housing (2014), increasing the number of mosquitos fogging (incidental), consultation with external stakeholder (October 2014)

There is a follow up result from the Stage 2 audit, which describes the further improvement efforts from the unit management of PT Sekarbumi Alamlestari;there are 12 Minorsand 22 OFIsthat have been followed up.

RSPO Internal Audit report by theSustainability Mandau Central Lab team (Florida Hutasoit & Ifanly Simorangkir) on 18 November 2013.

There is an Assistant Mill Adviser Report on KKS- Tapung Kanan, from 2012 to 2013, which consists of information regarding the mill’s operation for 1 year as well as the recommendation from advisor as a part of the sustainable improvement in accordance with the RSPO standard(explained in the last section of the report).



ASSESSMENT REPORT


3.2. Summary of Assessment Report of Supply Chain

Clause (Module E) CPO Mills - Mass Balance Requirements

1 Documented Procedures

1.1

The facility shall have written procedures and/or work instructions to ensure the implementation of all the elements specified in these requirements. This shall include at minimum the following:

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

b) The name of the person having overall responsibility for and authority over the implementation of these requirements and compliance with all applicable requirements. This person shall be able to demonstrate awareness of the facilities procedures for the implementation of this standard.

Sekarbumi Alamlestari Palm Oil Mill has had the SOP, which explains:

a. Source of FFB b. Documentation for the Sustainable Crude Palm Oil (Sustainable CPO), consist of: daily record of the FFB acceptance,

daily record of CPO production, which classified as the CSPO, CPO (RSPO/ISCC) sale record, stock record that has been reconciled with the FFB acceptance, monthly production and sale and annual recapitulation.

c. Documentation for the Sustainable Palm Kernel (Sustainable PK), consist of: FFB dispatch record, which further will be counted the daily production of the Sustainable PK, daily production record of the PK, which classified as the Sustainable PK, monthly recapitulation of the Sustainable PK’s sale, stock record, which has been reconciliated with the FFB acceptance record, monthly sale production and annual recapitulation.

d. The responsibility of the management (Manager Mill) and Internal Audit to assess the implementation of the SOP requirement and the sustainable management in the certified palm oil mill.

Full Compliance

1.2

The facility shall have documented procedures for receiving and processing certified and non-certified FFBs.

Sekarbumi Alamlestari Palm Oil Mill has had the procedure, which regulates:

1. FFB acceptance in the security hut and weight station. - Supply chain system

2. Production and storage tank– Plant & Storage Tanks - CPO’s supply - Sustainable PK

3. Sale & Dispatch to the refinery - Sustainable CPO - Sustainable PK

The current implemented supply chain model is the Mass Balance (description of the product is stated in the sale documentations, for instance in the invoice is MB).

Full Compliance

2 Purchasing and goods in

2.1

The facility shall verify and document the volumes of certified and non-certified FFBs received.

Records and documentations are available:


ASSESSMENT REPORT


1. Separation between FFB from certified estateand FFB from uncertified estate. The separation is conducted in weight-ticked form (the weighing evidence of the accepted FFB);consist of RFS form (certified) and non-RFS (uncertified). There are same samples of the weight ticket in January that has a RSPO Certified stamp for FFB from the nucleus estate, meanwhile FFB from uncertified estate has no stamp and has been separated since the acceptance of the FFB.

2. Stock report on Certified Sustainable FFB, Crude Palm Oil (CPO) & Palm Kernel (PK) – Mill: SA-POM, in January 14 (Total volume of the Certified FFB = 10.954.090 kg and non certified FFB = 1.238.400 kg) and recapitulation report over the Certified Sustainable FFB, Crude Palm Oil (CPO) & Palm Kernel (PK) PT Sekarbumi Alamlestari Tapung Kanan – POM, from October 2013 to January 2014 (budget year from October 2013 to September 2014).

Full Compliance

2.2

The facility shall inform the CB immediately if there is a projected overproduction.

Based on actual data of the production from May 2013 to January 2014, its known that until the implementation of the Surveillance 1 (February 2014) total CPO was 22.050,61,which is under the claimed volume in the certificate ST 2 (28.186) and total PK was 5,566.49which is under the claimed volume in the certificate ST 2ST 2 (7.187). Based on this data, its known that the certified CPO and PK product were not exceeding the claim.

Full Compliance

3 Record keeping

3.1

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

Based on SOP of supply chain for mill and Sekarbumi Alamlestari palm oil POM, the entire records are stored for 10 years, which is in accordance with the legal requirement. Sample of the records such as:

1. Trade agreement in the Local Delivery Contract document, Sellers is PT Sekarbumi Alamlestari (Date: 6/06/2013, Ref #: SBI/00366-PK-MB) with Buyers: PT Adey Plantation & Industry (Ref #:ADEI/PK-MB/0813/2).

2. Recapitulation report of the Certified Sustainable FFB, Crude Palm Oil (CPO) & Palm Kernel (PK) PT Sekarbumi Alamlestari Tapung Kanan – POM, from October 2013 to January 2014 (budget year from October 2013 to September 2014).

Full Compliance

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

Sekarbumi Alamlestari POM sets the shelf life of the documents and records that cover the entire aspect of Supply Chainrequirement is7 year.

Full Compliance

3.3 (a) 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. (b) All volumes of palm oil and palm kernel oil that are delivered are deducted from the material accounting system

according to conversion ratios stated by RSPO. (c) The facility can only deliver Mass Balance sales from a positive stock. However, a facility is allowed to sell short.

Report over theFFB, CPO and KPO documentation of PT Sekarbumi Alamlestari is carry out through:

1. FFB acceptance report and CPO dispatch and Kernel, which documented in monthly period (Monthly FFB production and documentation of the CPO and Kernel dispatch).

2. Monthly report, there are samples of Stock report on Certified Sustainable FFB, Crude Palm Oil (CPO) & Palm Kernel (PK) – Mill: SA-POM, in January 14.

3. Recapitulation report of the Certified Sustainable FFB, Crude Palm Oil (CPO) & Palm Kernel (PK) PT Sekarbumi Alamlestari Tapung Kanan – POM, from October 2013 to January 2014 (budget year from October 2013 to September


ASSESSMENT REPORT


2014).

Full Compliance

3.4 The following trade names should be used and specified in relevant documents, e.g. purchase and sales contracts, e.g. *product name*/MB or Mass Balance. The supply chain model used should be clearly indicated.

There is a trade agreement in the Local Delivery Contractdocument, Sellers: PT Sekarbumi Alamlestari (Date: 6/06/2013, Ref #: SBI/00366-PK-MB) with Buyers: PT Adey Plantation & Industry (Ref #: ADEI/PK-MB/0813/2). Supply chain model in this document can be identified in the contract reference with a code MB.

Full Compliance

3.5 In cases where a mill outsources activities to an independent palm kernel crush, the crush still falls under the responsibility of the mill and does not need to be separately certified. The mill has to ensure that the crush is covered through a signed and enforceable agreement.

Sekarbumi Alamlestari Palm Oil Mill only sale it’s Palm Kernel to PT Adey Plantation & Industry, which is another unit within the same holding companyfrom Kuala Lumpur Kepong Berhad (Indonesia). The trade agreement is available in the Local Delivery Contract document, Sellers PT Sekarbumi Alamlestari (Date: 6/06/2013, Ref #: SBI/00366-PK-MB) with Buyers: PT Adey Plantation & Industry (Ref #: ADEI/PK-MB/0813/2).

Full Compliance

4 Sales and goods out

4.1

The facility shall ensure that all sales invoices issued for RSPO palm oil 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 or Mass Balance)

(d) The quantity of the product delivered

(e) Reference to related transport documentation

Local Delivery Contract is available, Sellers PT Sekarbumi Alamlestari (Date: 6/06/2013, Ref #: SBI/00366-PK-MB) with Buyers: PT Adey Plantation & Industry (Ref #: ADEI/PK-MB/0813/2) in August 2013, the document states, such as:

Buyer’s name and address: PT Adey Plantation & Industry, Address: Taman Anggrek shopping complex, Block B2 – B5, Pekanbaru-Riau.

Invoice Date: 6 August 2013

Product description: Mass Balance (MB)

Total product: 200.00 Metric Tones, price: Idr. 3.987,50 per Kg.

Reference of the transportation document: stated in the document(permit form), for instance, transportation on 23 August 2013, total 30.050 Kg is conducted by CV Sentana (completed with theseal number, DO’s number,contract’s numberandcontract quantity)

Dispatch and transportation are agreed in the Mandau KCP, Jl. Raya Pekanbaru – Duri, KM 101.

Full Compliance

5 Training

5.1

The facility shell specifies and provides the training for all staff as required to implement the requirements of the Supply Chain Certification Systems.


ASSESSMENT REPORT


Record’s proof such as:

1. Supply chain training for related personnel on30 January 2013, which was followedby 22 participants. Mr Stephen Tiong delivered the training.

2. Attendance sheet for the socialization of the supply chain in weigh office of PT Sekarbumi Alamlestari –Tapung Kanan mill on 11 January 2014.

Full Compliance

6 Claims

6.1 The facility shall only make claims regarding the use of or support of RSPO certified oil palm products that are in compliance with the RSPO Rules for Communications and Claims.

Sekarbumi Alamlestari – POM able to show the usage of the claim to support the RSPO certified claim that is in accordance with the RSPO Guidelines for Communication and Claims, which is stated in the Sales Contract, Delivery Order, sale notes and Invoice.

Full Compliance


ASSESSMENT REPORT


3.3. Conformity Checklist of Certificate and Logo Use

1. Evidence of permission or approval certificate and logo from Certification Body which submitted by Client

X or √

ASA-01 PT Sekarbumi Alamlestari already have the approval/permit to use a certificate with the number

MUTU-RSPO/025 √


2. Implementation of certificate and logo used by Client comply with size and type (shape) against Guideline of Logo Use

X or √

ASA-01 The Company is not use logo on-product nor off-product. √


3. Implementation of Certificate and Logo is not used on product

X or √



4. Controlling of Certificate and Logo, including withdrawing inappropriate logo.

X or √




ASSESSMENT REPORT


3.4. Summary of RSPO Partial Certification.

Total companies observed (0.5 √Y) Where Y is the total of uncertified RSPO registered company

The Management Unit name : ..........

Date of Observation: Date – Month – Year

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

regulations.

The entire units operating under the Kuala Lumpur Kepong Bhd organization (subsidiary) carry

out the certification process according to TIME BOUND PLAN.

2.2 The right to use the land can be demonstrated, and is not legitimately contested by local

communities with demonstrable rights.



6.3 There is a mutually agreed and documented system for dealing with complaints and

grievances, which is implemented and accepted by all parties.



6.4 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.



7.3 New plantings since November 2005, have not replaced primary forest or any area

required to maintain or enhance one or more High Conservation Values.



7.5 No new plantings are established on local peoples’ land without their free, prior and

informed consent, dealt with through a documented system that enables indigenous

peoples, local communities and other stakeholders to express their views through their

own representative institutions.



7.6 Local people are compensated for any agreed land acquisitions and relinquishment of

rights, subject to their free, prior and informed consent and negotiated agreements.




ASSESSMENT REPORT


3.5 Identification of Findings, Corrective Action, Observations, Opportunity for Improvement and Noteworthy Positive Components.

3.5.1 Identification of Findings, Corrective Actions and Observations at ST-1 Assessment

CAR No

Ref Std Finding Area Grade Time

Limits Corrective Action Observation Status

Closing Date

2012. 01

Minor 4.6.1

Evidencce of a reduced of paraquat use. No sufficient evidence of reduced use of paraquat pesticide, nor its entire elimination.

Estate Minor S-1 The company shall present the evidence of the reduced use of paraquat.

26 February 2014

The root of the problem:

The documentation process is less orderly

Curative Action:

The company can show it’s commitment on reducing the usage of paraquat, from 2012 to2013 company was succeeded reducing the usage of paraquat from 6680 literin 2012 to 1007 liter in 2013.

Preventive Action:

Undertake the reducing parquet usage program and the target of annual usage

Closed 26

February 2014

2012. 02

Minor 4.7.1

Labour Insurance Program. The document study revealed there are 530 Estate workers and 8 POM workers who have not been listed in the Occupational Accident Assurance program.

Mill and

Estate

Minor S-1 PTSA shall provide such occupational accident assurance for all workers.

26 February 2014


The Unit management does not know about the regulation related to accident insurance for the daily workers (BHL).

Curative Action:

The payment record of social insurance in September 2013 is available, which was paid to Bank Mandiri on 8 November 2013. For instance: 1. Company presents the payment

record of social insurance for 929

Closed 26

February 2014


ASSESSMENT REPORT


estate personnel (fix term personnel and daily workers) on 10 Feb 2014.

2. Company presents the payment record of social insurance for 116 mill personnel on 10 Feb 2014.

In accordance with the number of personnel based on personnel file in January 2014, it’s known that the number of personnel in estate was 926 personnel (53 PBT, 406 SKU and 467 BHL) in Januaryand 3 mill’s personnel were resign by the end of January and 116 fix term personnel.

Preventive Action:

The Management unit will always coordinate with the human resources manager regarding the fulfillment of regulation.

2012. 03

Minor 4.7.3

Records of Hazard Identification & Risk Analysis. The document of Hazard Identification & Risk Analysis in POM has not fully covered the entire Hazard Risk potentially occur in all activities, such as in the repair and maintenance activities at each processing station as well as at chemicals warehouse.

Mill Minor S-1 PTSA shall perform the Hazard Identification & Risk Analysis on all activities at the company’s operational areas.

26 February 2014


The company has no occupational health and safety (OSH) expert who understand the implementation of OSH.

CurativeActions:

The identification document of risk sources and evaluation are available, such as:

1. Tapung Kanan Estate. The identification of OSH sources and risk evaluation related to estate latest activity on 20 December 2012. The identification of OSHsources and risk evaluation in nursery, replanting,

Closed 26

February 2014


ASSESSMENT REPORT


spraying, pests controlling, fertilizing, road maintaining, transporting, the application of empty fruit bunches, harvesting, workshop, diesel fuel and chemical warehouse, material’s warehouse, generator hut, housing and hazardous waste warehouse and office.

2. Tapung Kanan Mill. The identification document of risk sources and evaluation related to maintenance activity is available, for the entire stations, workshop area, housing, office and warehouse’s laboratory (hazardous waste warehouse, hazardous waste and material warehouse), which are renewed on 01 September 2013.

Preventive Action:

The OSH expert will always evaluate and supervise the overall OSH implementation in PT SA including the Identification document of the risk identification and risk evaluation.

2012. 04

Minor 4.7.8

A review on Occupational Accident. There has not been any sufficient evidence showing that the Guiding Committee Of Occupational Safety & Health (P2K3) has conducted the studies on the occupational accidents occurred at the estate.

Estate Minor S-1 PTSA shall present the record of the study of occupational accidents occurred at the company.

27 February 2014


The company has no occupational health and safety (OSH) expert who understand the implementation of K3.

Curative Action:

The recapitulation report on the work accident explains the analysis of accidents, including the time and place, the data of victims, source

Closed 27

February 2014


ASSESSMENT REPORT


of accident, the number of work hour loss, the aid that has been given, victim presentcondition and recommendation.

Preventive Action:

The OSH expert will always evaluate and supervise the overall OSH implementation in PT SA including the analysis of work accident in the guiding committee of OSH (P2K3) meeting.

2012. 05

Minor 6.4.1

Identification of the compensation. PTSA has not been able to fully present the results of the identification of those receiving the compensations.

PTSA Minor S-1 PTSA shall fully present the identification of the people receiving the compensations.

27 February 2014


The entire compensation document is well documented in Head Office Jakarta.

Curative Action:

The company has shown the sample of inventory list document (identification) of landowner, plantation and curative efforts in order to release the area for PT Sekarbumi Alamlestari.

Preventive Action:

The soft copy documents should be available in unit office.

Closed 27

February 2014

2012. 06

Minor 6.4.2

The process of land compensation settlement. PTSA has not been able to present the results of negotiation and settlement process for the people who receive the compensation.

PTSA Minor S-1 PTSA shall present the negotiation process done with the people receiving compensation.

27 February 2014



Curative Action:

The company has shown the sample of document such as Surat Tanda Penerimaan

Closed 27

February 2014


ASSESSMENT REPORT


pemilik lahan. This letter explains that by signed this letter; the landowner has released his right over the land.

Preventive Action:


2012. 07

Minor 6.4.3

Payment receipts of land compensation. PTSA has not been able to present the results of payment process done to the people receiving compensation.

PTSA Minor S-1 PTSA shall present the records of land compensation payment process.

27 February 2014



Curative Action:

The company has shown the sample of invoice for the land compensation and letter of accepting compensation from PT Sekarbumi Alam Lestari

Preventive Action:


Closed 27

February 2014

2012. 08

Minor 6.6.1

Records of the meeting with labour union. PTSA has not been able to present the records of the meeting held with the labour union.

PTSA Minor S-1 PTSA shall present the evidence of the meeting held with labour union.

27 February 2014


The documentation process is less orderly

Curative Action:

Minutes of meeting of SPSI PT SA such as:

1. SPSI meeting in mess room of PT SA,which discusses the establishment of SPSI pleno committee on 11 May 2013, completed with the minutes of meeting and attendance sheet of 29

Closed 27

February 2014


ASSESSMENT REPORT


participants. 2. SPSI meeting in mess room of PT SA,

which discussesthe committee coordination meeting on 23 May 2013, completed with the minutes of meeting and attendance sheet of 13 participants.

3. SPSI meeting in mess room of PT SA, which discussesthe addition and recruitment for new member of SPSI, which conducted on17 October 2013, completed with the minutes of meeting and attendance sheet of 23 participants.

4. SPSI meeting in mess room of PT SA between the SPSI committee and company’s representative, which conducted on 28 November 2013 with a topic of socialization of the committee of SPSI PT SA, completed with the minutes of meeting and attendance sheet of 8 participants. (Photos are available)

Preventive Action:

The company pointed the manager who is in charge to collect the meeting records with SPSI.

2012. 09

SC-MB 5.1

Supply chain Training. SA has not conducted the Supply Chain Training for all staff as required in order to implement the requirements of Supply chain Certification System.

PTSA NC Before Report Issued

SA shall conduct the supply chain training for all relevant personnel in complying with such procedure.

2 February 2013. SA has conducted the supply chain training for all relevant personnel on 30 January 2012, which was attended by 22 participants. Materials and records are available.

Closed 5 February

2013


ASSESSMENT REPORT


3.5.2 Identification of Findings, Corrective Actions and Observations at ST2 Assessment

CAR No



Closing Date

2012. 10

Major

4.6.4

Used pesticide packagings were not

properly disposed of in accordance

with the regulations.

The field visit to the area of Hazardous

Waste Temporary Warehouse in TKE I

found used pesticide packaging that

were not properly disposed of in

accordance with the regulations (they

were instead discarded into the

disposal waterways).

Hazardous

Waste

Temporary

Warehouse

in TKE I

Major Before

report

issued

The company shall

properly manage the used

pesticide packaging in

accordance with the

applicable regulations.

21 December 2012.

PTSA and the representative from P2K3 have

conducted the inspection and corrective

actions in the following form:

a. Picking up the discarded pesticide

packaging and storing them in

Hazardous Waste Temporary Warehouse

in TKE-I, to be recorded in the

Hazardous Waste Balance Sheet.

b. Conducting the re-training and re-

dissemination for the Hazardous Waste

officers in anticipation of a good waste

management.

The records of the abovementioned activities

are well recorded and well documented.

Closed

With

observat

ion

21

December

2012

2012. 11

Minor

4.6.2

Medical Health Check for

agrochemical operators.

The document study and the result of

interviews done with fertilizing and

spray workers have revealed that PTSA

has not performed any regular medical

health check for Spray and Fertilizing

Workers.

Estate Minor S-1 PTSA shall present the record of the health check results for spray and fertilizing operators.

26 February 2014


The company has no occupational health and safety (OSH) expert who understand the implementation of OSH

Curative Action:

The company has a policy in the SOP 22 regarding the treatment facility, which states that the medical examination for high-risk

Closed 26

February 2014


ASSESSMENT REPORT


CAR No



Closing Date

personnel will be conducted every year.

There are medical examination reports on 11 November 2013and 29 November 2013 for the entire fertilization personnel, warehouse personnel, the chemical mixing personnel and sprayer by physician from Thamrin Clinic Pekanbaru.

Preventive Action:

The OSH expert has drafted the medical examination annual plan for the entire high-risk personnel.

2012. 12

Minor

4.7.2

Health Check for high-risk

operators.

The document study and the result of

interviews with the workers have

revealed that PTSA have not

conducted any health check for a

certain numbers of high-risk operators

(Boiler Operators, Lab Analysts,

Genset Operators and Welders).

Mill and

Estate

Minor S-1 PTSA shall conduct a regular basis health check for high-risk workers.

26 Februari 2014


The company does not yet have an expert who understanding of the implementation of K3

Curative Action:

The company has policy in SOP 22 about facilities treatment otherwise that medical examination for high-risk workers conducted a medical examination one time every year.

Health Examination Reports available on November 11, 2013 and December 29, 2013 for all high-risk workers (workers of mixing fertilizers, chemicals, sprayers, welders, boiler operator, IPAL, Power House, Lab and warehouse clerk) by doctors from the clinic

Closed 26 Feb 2014


ASSESSMENT REPORT


CAR No



Closing Date

Thamrin Pekanbaru.

Preventive Action:

The OSH Expert has been drafting plans for medical examination every year for all workers at high risk.

2012. 13

Minor

4.7.6

Fulfillment of the equipment for OHS

and First Aid Emergency Kit.

1. The field visit done to Hazardous

Waste Temporary Warehouse of

the Mill and to Hazardous Waste

Temporary Warehouse of TKE-I

resulted in the finding of non-

functioning Eye Shower (First Aid

Emergency Kit).

2. In TKE I Division 2B, the FFB

Transport Operator working at the

Loading Ramp was seen not

wearing PPE (safety shoes and

helmet), as such equipment were

not yet supplied by PTSA. This

instance did not comply with the

policy, program, and regulation of

Occupational Health and Safety

(Permenaker No. 9 year 2010).

3. The result of the field visit done at

Dispatch Station of PTSA POM

Hazardous

Waste

Temporary

Warehouse

of the Mill

Minor S-1 The company shall make

available all equipment

needed, for Occupational

Health and Safety, as well

as for First Aid Emergency

Kit.

21 December 2012 1. PTSA has repairing the P3K tools (such

as, Eye Shower), so this tool is well functioning.

2. PTSA showed the PPE’s hand over (such as, safety boots) to personnel (FFB transport operator). Based on field observation, the FFB transport personnel has been used the PPE (safety boots)

3. PTSA showed the evidence of PPE handover to electric personnel (electrician), which is signed by the personnel.

26 February 2014

1. There is an SOP No. 1 regarding the palm oil harvesting revision 1 on 1 February 2014 by the Sustainability team (including the OSH expert) that mention the PPE are helmet and boot. Based on OSH expert study on 1 Feb 2014 by considering complains from personnel regarding the obstacles on PPE’s usage (glassesand glove), noticed that the

Closed 26

February

2014


ASSESSMENT REPORT


CAR No



Closing Date

showed that the electrical

installation repair workers were not

equipped with PPE (gloves)

properly.

4. The field visit has confirmed that

the Company has supplied the

harvesters with PPE properly, i.e.:

Helmets and Boots. However, they

were not equipped with goggles

and gloves, two of the required

PPE for harvesters to comply with

the SOP.

number of accidents is due to unwearing the PPE and delivering the harvesting training as needed. Based on field visit, its known that the personnel have no objection to wear the PPE like helmets, boots and gloves.

The improvement activity’s above are well recorded and well documented.

2012.14

Major

5.3.2

Implementation of Domestic Waste

Management.

The field observation done at TKE-I

Division 2B has found that domestic

waste was not properly managed (the

waste was discarded into the

residential septic tank) and leachate

released from the landfill to flow and

contaminate the trenches in TKE-3

Division 4B. This is not complying with

the previously specified plan and

procedure.

TKE-1

Division

2B

and TKE-

3

Division

4B

Major Before

Report

Issued

The company shall carry out a good waste management to reduce the pollution and contamination.

30 December 2012.

The company has conducted the domestic

waste management to reduce the

contamination in the following manners:

a. The domestic waste management has

been conducted at TKE-I Division 2B by

storing it into a special landfill. The

record of domestic waste management

activities is available and well kept.

b. Improvements have been made on the

location of Landfills, so that the sewage

from the waste will not flow back into the

trench. Records of the landfill

improvement activities are available and

properly stored.

Closed

with

observat

ions

1 February

2012


ASSESSMENT REPORT


CAR No



Closing Date

2012. 15

Minor

6.8.1

Discrimination of Opportunity in

Becoming Permanent Employees.

Not all daily labours are given equal

opportunity and treatment in becoming

permanent employees (574 workers).

PTSA Minor S1 The company shall

provide equal opportunity

and equal treatment to

574 workers who are still

in Daily Labour status to

become permanent

workers.

27 February 2014


Management does not know the regulation related to promotion of daily workers into fix term personnel.

Curative Actions:

The company has identified the number of personnel who have been working for >21 daysfor 3 consecutive months are 169 personnel. The different of other daily workers< 21 days.

Regarding this finding, the company has promoted 169 personnel for 5 months (Jan-May 2014).

The realization of this promotion is 85 personnel have been promoted and 1 officer is no longer working (resign).

The company presents the document of promotion of daily worker into fix term personnel, which based on the service quality evaluation. For instance, the promotion in January 2014 for as much as 60 personnel; the promotion letter SKU No. 04/KTK-SA/SKU/1/2014 and sample of work agreement for newly fix term personnel No. 004/KTK-SA/I/2014.

Closed 27 Februari 2014


ASSESSMENT REPORT


CAR No



Closing Date

Preventive Actions:

The Management unit will always coordinate with the human resources manager related to the obedience toward the regulation.

3.5.2 Identification of Non Confirmity at Annual Survaillance Assessment-01

CAR No.

Ref Std

Finding Area Grade Time Limits

Corrective Action Observation Status Closing Date

2014.01 Minor 6.3.1

There are records, complain mechanism/objections.

There is an HGU area in Block 99 H, which is claimed (owned) by some community groups. The accusation has been delivering to PT SA. Based on Bangkinang Court decision No. 36. /Pdt.G/2009/PN.Bkn on 20 April 2010, it is stated that the accusation is rejected, and the community groups are lose. However, in fact, until now this area can’t be managed by the company because some community groups don’t want to received the court’s decision. There is no complaining mechanism document available.

PT SA Minor S-2 The company should be able to present the record of complain mechanism/ objection in Block 99 H.

Open

2014.02 Minor 4.7.6

The provision of occupational health and safety(OSH).

Based on field visit, there are still some personnel that unwearing the PPE, for

Estate Minor S-2 The company should provide the PPE for the entire personnel.

Open


ASSESSMENT REPORT


instance is theharvesting officer. The explanation from themanagement unit, the company not provides the PPE for this officer.

3.5.3 Opportunity for Improvement

No Ref Std Descriptions

1. Minor 5.2.2. PTSA has an opportunity to improve training and additional personnel for the management of HCV

2. Minor 6.1.1. PTSA has an opportunity to implement the program CD/CSR based on basic need of local communities

3.5.4 Noteworthy Positive Components

No Ref Std Descriptions

1 PTSA has RSPO certified by 2013

2 PTSA has a smallholding as an effort to improve the welfare of local people


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3.6 Summary of Arising Issues from Public, Management and Auditor Response

Public Issues (Institution/ NGO/Community)

Management Responses Auditor Responses

WWF Indonesia-Program Riau.

Positive Issues:

The positive aspect in the palm oil estate management is; gives the economic value for community who work or sale the FFB to the company.

The rural economic condition is developing.

County has an income from the tax and devisa

Negative Issues:

The negative aspect from the palm oil plantation is; contributes to the pollution of the river because the usage of fertilizer and pesticide.

New conflict between personnel and company because of the economic gap.

PT. Sekar Bumi Alamlestari has a conflict with the community in 2011. There are 6 requests from the community regarding the KKPA, such as, the maintenance is given to the member while the difference is given to the member to be equally shared, and the compensation is Idr. 500.000 per head of familyin a short time, the expenses for new plantation and old plantation is separated, kavling is divided per members, the copy of the certificate has been handed to the members.

Company has undertaken several preventive actions toward environment pollution that are caused by company’s activity, such as: 1. The mix of chemical material is conducted in the agrochemical-mixing place. 2. Perform no fertilizing and spraying in riparian area (DSS) for about 50 meters from left and right along the river 3. Manage the hazardous waste properly. 4. The water analysis result over the river water shows no pollution due to PT. Sekarbumi Alamlestari (PT. SA) activity.

Until now, there is no conflict.

Based on meeting result on 17 October 2013, there is an agreement which is agreed by both parties: 1. The compensation has been disbursed in accordance with the mutual agreement. 2. The cooperative member may monitor the operational activity of KKPA estate 3. The copy of certificate cannot be sent because the map of plasma location is still in the national land agency. 4. The difference of expensescannot be handed to members because it’s used to pay the operational loan.

The company commits to ensure the sustainable palm oil plantation management. This can be showed by the development of village economic status.

The company has undertaken several preventive efforts on the environment degradation due to estate activity and based on interview and field observation, there is no social gap between personnel and the company.

Environment Agency of Kampar District

Positive Issues:

Report on the implementation of the environment management

Correct

The company commits to support the environment


ASSESSMENT REPORT




of PT SA has been submitted regularly and on time, such as the hazardous waste three months report, the UKL and UPL semester report, andthree months report of the liquid waste management.

The company has had the license to utilize the liquid waste to the estate area.

The company has had the location permit for hazardous waste temporary storage and has conducted the mandatory report regularly which stated in the permit.

The environment agency conducts regular visit to PT SA.

Correct

Correct

Correct

management and monitoring. This can be seen in:

a. Report on the implementation of environment management, which has been submitted regularly.

b. Has had the permit to utilize the liquid waste in estate area.

c. Has had the hazardous waste landfill permit

Manpower agency of Kampar District.

Positive Issues:

The company has reported the salary and work requirement every month to the manpower agency.

The company has had the license letter for boiler and transport operator, has certified welders, has OSH expert who has followed training.

The P2K3 report has been regularly reported every month.

The company is actively conducting the blood donors with cooperation with IndonesianRed Cross and manpower agency.

PT SA has following the regulation on salary that is in accordance with the applicable minimum wage regulation.

PT SA has worker union that had been registries in the manpower and transmigration agency.

Correct

Correct

Correct

Correct. Conducted 1 x 6 months

Correct

Correct

The company able to maintain its well performance on manpower.

Estate Agency of Kampar District

Positive Issues:

The company has implemented the license system


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PT SA has had the IUP-B and IUP-P

PT SA has regularly submitted its business report to the Estate Agency every 6 months.

Correct

Correct

and estate management according to the IUP-B and IUP-P, as well as submitted the estate regular report every 6 months.

Kota Bangun Village

Positive Issues:

The relationship between government and company runs well.

The grant request to the company is submitted through written letter, such as heavy equipment (backhoe loader) request for road maintenance.

Until now, there is no complains or objections from the community regarding the negative impact from PT Sekarbumi Alamlestari mill and estate operation.

There is no problems over the land ownership between local community and the company.

The trench washing usually is conducted in the estate area of PT Sekarbumi Alamlestari and the water disposal is to Palapian tributary, which passing the plasma area in Kota Bangun village and this is creating the silting in the watershed. This problem has been followed up by lend the heavy equipment.

Will be sustained and improved in the future.

Has been well responded. Every grant request has been responded based on company’s ability.

Will be sustained through the best practices from the estate and management.

Correct. The Sekarbumi area has the power of legality.

Actually, the silting of the river is not caused by PT. SA activity, but because of another company, which located in headwaters area. However, PT.SA is always open minded to the complaints and support the community by lending the heavy equipment to tackle the silting problem.

PT Sekarbumi Alamlestari is suggested to implement the CD/CSR program, which based on thelocal community’sbasic need.


ASSESSMENT REPORT




Kota Garo Village Positive Issues

The relationship between government and company runs well.

The company has given the grants and aids to surrounding villages through the CD/CSR program.

The land dispute in Block 99H from community groups in Kota Garo village needs a resolution through communicationandapproachfrom themanagement of PT Sekarbumi Alamlestari (especially from the Head Office/Headquarter) to find the solution that consider the local situation or social circumstance of the village.

Will be improved in the future

Correct. Will be sustained.

Will be followed up and will be communicated with the Head Office.

PT Sekarbumi Alamlestari is suggested to implement the CD/CSR program, which based on the local community’s basic need.


ASSESSMENT REPORT


4.0 CERTIFIED ORGANISATION’S ACKNOWLEDGEMENT OF INTERNAL RESPONSIBILITY

4.1 Formal Sign-off of Assessment Findings

Hereunder sign by management representative from inspected company to acknowledge a field assessment and agree for all content explained in this assessment report, included of non-compliance findings.

Signed on behalf of:

PT.Sekarbumi Alamlestari, KLK Bhd Mutuagung Lestari

Head of Sustainability Lead Auditor

Stephen Tiong Mee Ing Oktovianus Rusmin

Friday, 28 February 2014 Friday, 28 February 2014


ASSESSMENT REPORT


Appendix 1. List of Stakeholder Contacted in the RSPO Certification Process

No Institution/NGO/Community Address Phone/Email Form of Contact

Date of Contact

1 Environmental Body Kampar District, Riau Province

(0762)20262 Interview 25 February

2014

2 Labour Agency Kampar District, Riau Province

Jl. DR. A. Rahman Saleh, Bangkinang (28411) - RIAU

Interview 25 February

2014

3 WWF of Riau Province Pekanbaru, Riau (0761)34266 Interview 25 February

2014

4 Kota Bangun Village Head and community leaders

Tapung Hilir Sub district, Kampar District, Riau Province

- Interview 27 February

2014

5 Kota Garo Village Head and community leaders

Tapung Hilir Sub district, Kampar District, Riau Province

- Interview 27 Februariy

2014


ASSESSMENT REPORT


Appendix 2. Assessment Program

DATE 24 – 28 February 2014

ACTUAL PROGRAM PROCESSES / CLAUSES TO BE AUDITED AUDITOR

Moday, 24 February 2014 06.00 - 08.30 09.00 – 13.00 14.00 – 14.30 14.30 – 17.30

Jakarta – Pekanbaru Pekanbaru – PT.Sekarbumi Alamlestari office Opening Meeting Document Observation:

Commitment to transparency (1.1;1.2)

Compliance with applicable laws and regulations (2.1;2.2;2.3)

Commitment to long-term economic and financial viability (3.1)

OR, MES, SM, TN, MR

Tuesday, 25 February 2014 08.00-15.00

06.15 – 07.00

08.00 – 12.00

14.00 – 15.00

15.00 – 17.00

Stakeholder Consultation (Related Agencies) Muster Morning Document observation:

Use of appropriate best practices by growers and millers (4.1; 4.2; 4.3; 4.4; 4.5; 4.6; 4.7; 4.8; 8.1; 8.2)

Responsible consideration of employees and of individuals and communities affected by growers and mills (6.1; 6.2; 6.3; 6.4; 6.5)

OR

MES, SM, TN, MR

MES, SM, TN, MR


ASSESSMENT REPORT


Wednesday, 26 February 2014 08.00 - 12.00

14.00 – 17.00

Field Observation: a. Tapung Kanan P.O.M

Documentation, workers interview (payment, training, facilities, racial harassment), safe working practices, safety and health equipments, fuel, water usage, process station, waste water treatment plant, workshop, hazardous waste storage and handling,

b. Tapung Kanan 1 Estate & Kota Bangun Village

Legal boundaries, housing complex and facilities (clean water, electric, worship buildings, health clinic, school, landfill and emergency response), harvesting activity, spraying activity, conservation area, IPM implementation, chemical storage (mixing and handling mechanism), workshop and interviews (payments, sexual and racial harassment, child labour, religious, complaints procedures), interviews with head of Kota Bangun Village.

Conservation, erosion and lowland area Implemetation, riparian zone, water management, run off

Document Observation:

Environmental responsibility and conservation of natural resources and biodiversity (5.1; 5.2; 5.3; 5.4; 5.5; 5.6)

Responsible consideration of employees and of individuals and communities affected by growers and mills (6.1; 6.2; 6.3; 6.4; 6.5; 6.6; 6.7; 6.8; 6.9; 6.10; 6.11)

MES

OR, SM, MR

TN

OR, MES, SM, TN, MR

Thursday, 27 February 2014 08.00 - 12.00

14.00 – 17.00

Field Observation: a. Tapung Kanan 2 Estate & Kota Garo Village

Legal boundaries, housing complex and facilities (clean water, electric, worship buildings, health clinic, school, landfill and emergency response), harvesting activity, spraying activity, IPM implementation, chemical storage (mixing and handling mechanism), workshop and interviews (payments, sexual and racial harassment, child labour, religious, complaints procedures), interviews with head of Kota Garo Village.

Field Observation Clarification Document Observation: a. Responsible development of new plantings ( Principal 7) b. Continuous improvement (Principal 8)

OR, MES, SM, TN, MR

OR, MES, SM, TN, MR


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Friday, 28 February 2014 08.00 – 09.00

09.00 – 10.00

10.00 – 14.00

17.00 – 19.00

Audit finding and conclusion preparation Closing Meeting at PT Sekarbumi Alamlestari Office PT Sekarbumi Alamlestari – Pekanbaru Pekanbaru – Jakarta

OR, MES, SM, TN, MR


ASSESSMENT REPORT


Appendix 3. Glossary

AMDAL (SEIA) : Analisis Mengenai Dampak Lingkungan (Social and Environmental Impact Assessment)

APD (PPE) : Alat Pelindungan Diri (Personal Protective Equipment)

B3 : Bahan Beracun dan Berbahaya (Hazardous Material Waste)

BOD : Biological Oxygen Demand

CPO : Crude Palm Oil

CSR : Corporate Social Responsibility

HCV : High Conservation Value (Nilai Konservasi Tinggi)

HGU : Hak Guna Usaha. (Land Use Permit)

IUP : Izin Usaha Perkebunan. (Plantation Operation Licence)

IPAL (WWTP) : Instalasi Pengelolaan Air Limbah (Wastewater Treatment Plant)

JAMSOSTEK : Jaminan Sosial Tenaga Kerja (Social Assurance of Labor)

Jankos / EFB : Janjangan Kosong / Empty Fruit Bunch

K3 (OHS) : Keselamatan dan Kesehatan Kerja. (Occupational Health and safety)

KER : Kernel Extarction Rate

KTK 1 : Kebun Tapung Kanan 1 (Tapung Kanan 1 Estate)



LC : Land Clearing

MRC : Minamas Research Center

OER : Oil Extarction Rate

P2K3 :

Panitia Pembinaan Keselamatan dan Kesehatan Kerja (Guiding Committee of Occupational Safety & Health)

PHT (IPM) : Pengendalian Hama Terpadu (Integrated Pest Management)

PK : Palm Kernel

PKS (POM) : Pabrik Kelapa Sawit (Palm Oil Mill)

POME : Palm Oil Mill Effluent

PTSA : PT Sekarbumi Alamlestari

RKL/RPL : Rencana Kelola Lingkungan/ Rencana Pemantauan Lingkungan. (Environmental Management Plan/ Environment Monitoring Plan)

RSPO : Roundtable on Sustainable Palm Oil

SEL : Studi Evaluasi Lingkungan (Environment Evaluation Study document)

SIA : Social Impact Assessment

SOP : Standard Operating Procedure

ST-1 : Stage 1

ST-2 : Stage 2

S1 : Surveillance 1

TBS (FFB) : Tandan Buah Segar (Fresh Fruit Bunch)

UKL/UPL : Upaya Kelola Lingkungan/ Upaya Pemantauan Lingkungan. (Environmental Management Efforts/ Environmental Monitoring Efforts)

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