rspo principles & criteria certification report public summary information · 2014-11-02 ·...

SGS RSPO

(Principles & Criteria)

Doc. Number: GP 7002A

Doc. Version date: 01 September 2012

Page: 1 of 77

RSPO PRINCIPLES & CRITERIA CERTIFICATION REPORT

Public Summary Information

Report Nr: MY02999 – IOI Leepang Production Unit– Main Assessment Report

Client: IOI Corporation Berhad

RSPO membership #: 010-04(O)

Web Page: http://www.ioigroup.com/business/busi_plantoverview.cfm

Address:

Head office: Level 8, Two IOI Square IOI Resort, 62502 Putrajaya Malaysia.

Mill: Leepang Palm Oil Mill: Morisem Palm Oil Mill Sdn. Bhd., Leepang Palm Oil Mill, Locked Bag No.15, 91109 Lahad Datu, Sabah.

Total Plantation Area 14,541 hectares

Company Contact

Person:

Mr. Too Heng Liew Head of Sustainability

Tel: +603-89478691

Fax +603-8947 8988

Email: [email protected]

Evaluation dates:

Main Assessment 31st July and 1

st – 2

nd August 2012

Surveillance 1

Surveillance 2

Surveillance 3

Surveillance 4

http://www.ioigroup.com/business/busi_plantoverview.cfm

mailto:[email protected]

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SGS (Malaysia) Sdn. Bhd Unit 10-1 10th Floor Bangunan Malaysian Re, No 17 Lorong Dungun Damansara Heights

(Co. No. 10871-T) 50490 Kuala Lumpur Malaysia. t +6 (03) 2095 9200 f +6(03) 2093 8202 www.sgs.com

Member of SGS Group (Société Générale de Surveillance)

TABLE OF CONTENTS

List of Abbreviation ............................................................................................................................................... 3

1. INTRODUCTION .......................................................................................................................................... 5

1.1 CERTIFICATION BODY ...................................................................................................................................... 5

2. SCOPE OF verification for certification .................................................................................................... 5

2.1 Background of Company, Certification Unit, Supply base .................................................................................. 5

2.2 Mill and Supply Base ........................................................................................................................................... 7

2.3 Location and hectareage statement .................................................................................................................... 8

2.4 Rainfall ................................................................................................................................................................ 9

2.5 Description of supply base ................................................................................................................................ 10

2.6 Planting Profile .................................................................................................................................................. 11

2.7 Organisational information/contact person ....................................................................................................... 11

3. 30 DAYS STAKEHOLDER NOTIFICATION .............................................................................................. 11

4. TIME BOUND PLAN .................................................................................................................................. 11

5. PREPARATION FOR THE EVALUATION ................................................................................................. 11

5.1 Schedule ........................................................................................................................................................... 11

5.2 Team ................................................................................................................................................................. 11

6. THE EVALUATION..................................................................................................................................... 12

6.1 Opening meeting ............................................................................................................................................... 12

6.2 Document review .............................................................................................................................................. 12

6.3 Sampling and Evaluation Approach .................................................................................................................. 12

6.4 Field Assessment .............................................................................................................................................. 12

6.5 Summing up and closing meeting ..................................................................................................................... 13

7. EVALUATION RESULTS ........................................................................................................................... 13

8. SUPPLY CHAIN ......................................................................................................................................... 47

9. EVALUATION DECISION .......................................................................................................................... 50

10. ACKNOWLEDGEMENT OF INTERNAL RESPONSIBILITY AND FORMAL SIGN-OFF OF

ASSESSMENT FINDINGS .................................................................................................................................... 50

APPENDIX A: CORRECTIVE ACTION REQUEST & OBSERVATION ............................................................... 51

APPENDIX C: TIMEBOUND PLAN ...................................................................................................................... 63

APPENDIX D: LIST OF STAKEHOLDERS CONTACTED .................................................................................. 64

LIST OF TABLES

Table 1: Mill Capacity and sources of FFB .............................................................................................................. 7

Table 2: Summary of Oil Palm Plantations in the Leepang Production Unit............................................................ 9

Table 3: Annual rainfall data ( in mm ) for individual Estate ( 2008/2009 - 2011/2012) .......................................... 9

Table 4: FFB Production Record ( 2009/10 - 2011/12 )......................................................................................... 10

Table 5: CPO Production Record ( 2009/10 - 2011/12 )........................................................................................ 10

Table 6: PK Production Record ( 2009/10 - 2011/12 ) ........................................................................................... 10

Table 7 : Auditors Profile ....................................................................................................................................... 11

Table 8: Audit Plan................................................................................................................................................. 12

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LIST OF FIGURES

Figure 1: Map of Sabah, Malaysia and location of the Leepang Production Unit .................................................... 8

LIST OF ABBREVIATION

Short Form Meanings

BOD Biological Oxygen Demand

CAR Corrective Action Request

CHRA Chemical Health Risk Assessment

COD Chemical Oxygen Demand

CPO Crude Palm Oil

DID Department of Drainage and Irrigation, Malaysia

DOE Department of Environment, Malaysia

DOSH Department of Occupational Safety and Health

EFB Empty Fruit Bunch

EIA Environment Impact Assessment

EMS Environmental Management System

EQA Environmental Quality Act

ERT Endangered, Rare and Threatened species

ESA Environmentally Sensitive Area

FD Final discharge

FFA Free Fatty Acids

FFB Fresh Fruit Bunches

FR Forest Reserve

GHG Green House Gas

Ha Hectare

HCV High Conservation Value

HDPE High Density Polyethylene

IPM Integrated Pest Management

ISO International Organisation for Standardisation

IUCN International Union for Conservation of Nature and Natural Resources

JCC Joint Consultative Committee

JKKP Jabatan Keselamatan dan Kesihatan Perkerja ( Department of Worker’s Safety and Health)

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

K Potassium

kW Kilowatt

M Meter

Mg Magnesium

Mm Millimeter

MSDS Matrail Safety Data Sheet

Mt Metric ton

MYNI Malaysia National Interpretation

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N Nitrogen

NGO Non Governmental Organisation

OA Orang Asli (Indigenous People)

OER Oil Extraction Rate

OSH Occupational Safety & Health

P Phosphate

P & C Principles and Criteria

PK Palm Kernel

POM Palm Oil Mill

POME Palm Oil Mill Effluent

PPE Personal Protective Equipment

PT Pejabat Tanah (Coding for Pahang Land Office)

SOP Standard Operating Procedures

Sdn Bhd Sendirian Berhad (Private Limited)

SEIA Social and Environment Impact Assessment

Sg Sungai

SGS Societe Generale de Surveillance

SOP Standard Operating Procedures

SPC Senior Plantation Controller

USECHH Use and Standards of Exposure of Chemicals Hazardous to Health

WHO World Health Organisation

yr Year

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1. INTRODUCTION

IOI Corporation Berhad is the existing member of the Roundtable on Sustainable Palm Oil (RSPO) and is committed to the sustainable practices of oil palm cultivation. The Group has also committed to the certification system of RSPO and as a part of the commitment; the Group invited SGS (Malaysia) Sdn Bhd (SGS) to certify IOI Leepang Production Unit and its Fresh Fruit Bunch (FFB) supplying bases located in Lahad Datu, Sabah, Malaysia. The auditing process is conducted according to the requirements of the QUALIPALM Programme, a SGS verification programme, for compliance to RSPO principles and criteria interpreted nationally in Malaysia [Malaysian National Interpretation Working Group (MY-NIWG)] dated November 2010.

1.1 CERTIFICATION BODY

SGS Group is the world’s largest auditing, inspection, testing and verification organisation founded in 1878. SGS Group is able to provide its international clientele with a comprehensive range of services in more than 145 countries from a unique international global network of more than 1180 offices, 321 laboratories and 50,000 full time staff. SGS has no manufacturing, trading or financial interests which could compromise its independence and biasness in the audit process. It guarantees independence, its reputation for professionalism, integrity and impartiality.

QUALIPALM programme of SGS Group’s Oil Palm certification programme has been accredited by RSPO to provide certification services both against the RSPO P&C and the RSPO supply chain. To date, SGS has conducted various RSPO related audits in Malaysia, Indonesia, Colombia and Thailand and has issued RSPO certificates to numerous companies.

2. SCOPE OF VERIFICATION FOR CERTIFICATION

An assessment of IOI Corporation Berhad – Leepang Production Unit (Leepang) was conducted by SGS Malaysia from 31st July until 2nd August 2012. The primary objective of the exercise was to evaluate existing documentation and field practices in sustainable oil palm management of the plantation unit against the Roundtable on Sustainable Palm Oil Principles & Criteria Malaysian National Interpretation Working Group 2010 (RSPO P&C – MY-NIWG).

2.1 Background of Company, Certification Unit, Supply base

Leepang Palm Oil Mill is one of the 12 palm oil mills owned by IOI Corporation Berhad. IOI Corporation Bhd is a Malaysian public-listed company with business under three key segments as in the diagram below.

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Under the Plantation segment, the Group has 82 estates, unchanged from the previous financial year and the total oil palm planted area as at the end of the financial year 2011/2012 under review stood at 157,752 hectares, an increase of 707 hectares from the previous financial year.

Approximately 65% of the Group’s oil palm plantation holdings are in East Malaysia, 29% in Peninsular Malaysia and the remaining 6% in Indonesia. The Group’s plantation produce are principally processed by its 12 palm oil mills with an annual milling capacity of approximately 4,000,000 tonnes of fresh fruit bunches (“FFB”). The Group’s plantation business over the years has been able to sustain as one of the most cost efficient producers in the industry due to management’s emphasis on continuous improvement in efficiency and productivity of its operations. Achievements in productivity are the result of years of concerted effort and commitment to good plantation management practices.

As a founding member of the RSPO, IOI Group has played an active role in promoting sustainable practices since its inception in 2004. It also advocates sustainable agricultural practices in its estates to bring growth and use of certified sustainable palm oil to the world market. All of IOI Group’s mills and estates in Peninsular Malaysia have successfully attained the RSPO Certification. In Sabah, four of IOI Group’s mills and their supply bases have been certified. IOI Group successfully attained two more Roundtable on Sustainable Palm Oil (RSPO) Compliance Certification for its Plantation Management Unit Syarimo Grouping and Ladang Sabah Grouping on 20 March 2013 and 3 April 2013 respectively. To date, 83% of its palm oil mills and 74% of its plantations estates have been RSPO-certified.

In addition, the entire IOI Group’s operating units and supply chain units have successfully obtained the RSPO Supply Chain Certification.

Leepang Palm Oil Mill is located in the Sukau-Kinabatangan region of the district Lahad Datu in the State of Sabah, Malaysia. It is accessible by road using the Jalan Jeroco.an alternative route is through the Jalan Sukau. However , one has to cross over the second longest river in Malaysia by barge to reach the location. Through a series of land acquisition during the mid -1990s and early 2000s IOI Group expanded in the Sukau-Kinabatangan region resulting in the estates of Leepang, Morisem and Permodalan. Leepang 1 was bought from a private company, B A Plantations Sdn. Bhd. Leepang 5 was also bought from a private company, Pine Capital Sdn. Bhd. Morisem 5 was bought from yet another private company, Meriteam Sdn. Bhd. They were already planted with oil palm when acquired.

Permodalan Estates were formerly cocoa plantations owned by the state government through KPD (Koperasi Pembangunan Desa). They were bought over by IOI and converted to oil palm.

Leepang Group consists of the following : Morisem Group consists of the following:

Leepang Palm Oil Mill 2) Leepang 1 Estate 3) Leepang 5 Estate 4) Morisem 5 Estate 5) Permodalan 1 Estate 6) Permodalan 2 Estate 7) Permodalan 3 Estate 8) Permodalan 4 Estate

1) Morisem Palm Oil Mill 2) Morisem 1 Estate 3) Morisem 2 Estate 4) Morisem 3 Estate 5) Morisem 4 Estate 6) Leepang 2 Estate 7) Leepang 3 Estate 8) Leepang 4 Estate 9) Asas (Tas) & Halusah Estates

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All Morisem estates used to send FFB to Morisem Palm Oil Mill whilst all Leepang estates used to send FFB to Leepang Palm Oil Mil ( LPOM ) l. The Leepang Palm Oil Mill was commissioned in Oct 1997.This arrangement was changed when the new Morisem mill was commissioned on the 16th of July 2003. The new mill is in Leepang 2 whilst the old mill was in Morisem 3. The new location made it more convenient (nearer) for LP 2, 3 & 4 to send their crop to the new mill whilst Morisem 5 was further from it but nearer LPOM – hence the re-grouping of the supplying estates.

2.2 Mill and Supply Base

The Leepang Palm Oil Mill (Leepang POM) has a processing capacity of 40 tonne per hour with an annual CPO output (FY 2010/2011) of approximately 62,000 metric tonnes. The mill receives fresh fruit bunches from its supplying estates located within Lahad Datu District namely Morisem 5, Leepang 1, Leepang 5, Permodalan 1, Permodalan 2, Permodalan 3 and Permodalan 4. A summary of the sources is presented in Table 1 below:

Table 1: Mill Capacity and sources of FFB

MILL: LEEPANG PALM OIL MILL

Mill location & Capacity Source FFB input (mt)

2011/2012

CPO output (mt)

2011/2012

PK output (mt)

2011/2012

Leepang Palm Oil Mill,

Locked Bag No.15,

91109 Lahad Datu,

Sabah. (Postal)

GPS: X : 118.43767

Y: 5.54901

N 5 32.941 E 118 26.260

Capacity : 40 TPH

FFB from Supply Base

Estates 255,894.64

54,535.63

13,296.29

FFB from other IOI supply Base

157.48 33.56 8.18

Other non-IOI supplier

0 0 0

Total processed

256,052.12 54,569.21 13,304.43

OER : 21.312% KER: 5.196%

No. Estate Area

Total Planted (Mature) Planted (Immature)

1. Morisem 5 1,889 1,548 0

2. Leepang 1 2,349 2,177 0

3. Leepang 5 1,690 1,461 0

4. Permodalan 1 2,254 2,125 0

5. Permodalan 2 1,937 1,780 0

6. Permodalan 3 2,560 2,428 0

7. Permodalan 4 1,862 1,754 0

TOTAL 14,541 13,273 0

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2.3 Location and hectareage statement

As mentioned above, Leepang Production Unit comprises of seven directly managed estates namely Morisem 5, Leepang 1, Leepang 5, Permodalan 1, Permodalan 2, Permodalan 3, Permodalan 4 and a 40 tonne mill designated as Leepang POM. The estates supplying the mill are spread out within the vicinity of the POM in the Lahad Datu District, Sabah, Malaysia. The location map of the estates is presented in the following map below and the attached map file.

Figure 1: Map of Sabah, Malaysia and location of the Leepang Production Unit

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For the maps of the individual estate, please refer to the attached file for the individual maps

The hectarage statement for all estates is presented in Table 1 above. The total planted area for the seven directly managed estates is 13,273 ha. The individual estate summary is presented in Table 2.

Table 2: Summary of Oil Palm Plantations in the Leepang Production Unit

Names of Estate Morisem

5

Leepang Permodalan Grand

Total

1 5 1 2 3 4

Year of planting 1992 & 1993

1995 & 2002

1996 & 2003

1995 & 1997

1995 & 2001

1996 & 1997

1996 & 1997

Mature 1,548 2,177 1,461 2,125 1,780 2,428 1,754 13,273

Immature 0 0 0 0 0 0 0 0

Total Production

Area (ha) 1548 2177

1461 2125 1780 2428 1754 13,273

Conservation Area

1.12 1.38 0 1.45 20.41 1.37 0.92 26.65

HCV Area 248 13.06 150 7 2 5 0.5 425.56

Others : Roads, Housing Area , Office , Mill, etc

91.88 157.56 79 120.55 134.59 125.63 106.58 815.79

TOTAL

PLANTATION

AREA (ha)

1,889 2,349 1,690 2,254 1,937 2,560 1,862 14,541

14,541

2.4 Rainfall

The mean rainfall information for the individual estates in the Unit for June 2008 to July 2012 is

presented in Table 3.

Rainfall data for the latest financial period of 2011/2012 shows that the area receives rainfall ranging from 2,353 mm to 3,780mm.

From the 4 years of data, the lowest annual rainfall received was in 2009/2010 when Leepang 1 and Permodalan 2 received an annual rainfall of 1,906mm and 1,789 mm respectively.

From the data, it also shows that in 2010/2011, the estates received the highest rainfall.

Table 3: Annual rainfall data ( in mm ) for individual Estate ( 2008/2009 - 2011/2012)

Name of

Estate Morisem

5

Leepang Permodalan

1 5 1 2 3 4

2008/ 2009 3797 2529 3988 3481 3022 3435 3842

2009/ 2010 2777 1906 2318 2195 1789 2907 2773

2010/ 2011 4645 3186 4756 3741 3795 4571 4490

2011/ 2012 3780 2353 3769 3280 3423 3261 3257

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2.5 Description of supply base

The Leepang POM receives FFB from the above-mentioned estates. Occasionally it will processed FFB form IOI sister estates within the location. Currently, the POM does not source its FFB from other out growers and smallholders.

Based on records, for financial year 2011/2012, the FFB production recorded is 256,074.64 mt

compare to the previous financial year , 2010/2011 where the production unit recorded at 320,270.09 mt of FFB production.

See Table 4 below for FFB production for all estates. Total Crude Palm Oil (CPO) and Palm Kernal

(PK) production are shown in Table 5 and 6 respectively.

Table 4: FFB Production Record ( 2009/10 - 2011/12 )

Estate FFB production (Metric Tonne)

2009/2010 2010/2011 2011/2012

Morisem 5 29,619.54 51,227 27,849.46

Leepang 1 55,777.88 56,517.71 46,852.13

Leepang 5 26,607.00 30,819.49 27,492.73

Permodalan 1 48,995.86 43,222.93 37,417.45

Permodalan 2 42,396.71 42,637.95 40199.70

Permodalan 3 42,369.36 51,226.72 42,861.50

Permodalan 4 48,099.55 44,618.29 33,401.67

TOTAL 293,865.90 320,270.09 256,074.64

Table 5: CPO Production Record ( 2009/10 - 2011/12 )

Financial Year

Estate 2009/2010 2010/2011 2011/2012

Leepang 1 12,073.12 11,862.61 10,085.19

Leepang 5 5,768.28 6,421.57 5,863.43

Morisem 5 6,261.88 5,997.01 5,728.83

Permodalan 1 10,808.49 9,104.89 8,050.45

Permodalan 2 9,277.43 8,955.00 8,656.86

Permodalan 3 9,135.81 10,562.46 8,975.27

Permodalan 4 10,612.28 9,360.67 7,178.97

Total 63,937.29 62,264.20 54,539.01

Table 6: PK Production Record ( 2009/10 - 2011/12 )

Financial Year

Estate 2009/2010 2010/2011 2011/2012

Leepang 1 2,597.62 2,882.41 2,451.88

Leepang 5 1,235.52 1,555.89 1,351.73

Morisem 5 1,380.88 1,734.45 1,468.80

Permodalan 1 2,289.89 2,216.18 1,960.36

Permodalan 2 1,983.94 2,181.78 2,111.94

Permodalan 3 1,928.97 2,540.12 2,136.51

Permodalan 4 2,243.13 2,278.95 1,757.15

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Total 13,659.96 15,389.77 13,238.38

2.6 Planting Profile

The planted oil palm profile can be found in Table 2 above. All the plantings has been classified as

matured as the last planting was done in 2003 in Leepang 5. Out of a total area of 14,541 ha the

planted area is 13,273 ha.

2.7 Organisational information/contact person

Name Mr Too Heng Liew

Designation Head of Sustainability

Level 8, Two IOI Square IOI Resort, 62502 Putrajaya Malaysia.

Contacts Tel: +603-89478691

Fax: +603-8947 8988

Email [email protected]

3. 30 DAYS STAKEHOLDER NOTIFICATION

The 30 days stakeholder notification was published in the RSPO website on 2nd June 2012. Until the end of audit and at the time of writing this report there were no feedbacks received from the stakeholders consulted.

4. TIME BOUND PLAN

IOI as one of the main player in the oil palm industry in Malaysia has made commitment to bring all of its holding to RSPO certification latest by 2015. The certification schedule for IOI’s plantation

management unit is provided in Appendix C. The plan developed by IOI is very challenging but the company has made good progress where at least one certification unit has been certified and several more are at various stages of certification process.

5. PREPARATION FOR THE EVALUATION

5.1 Schedule

The evaluation was preceded by a discussion on the logistic planning with IOI’s personnel. This is important to ensure that sufficient time is allocated to allow coordination among team members.

5.2 Team

The team that conducted the Main Assessment are presented in Table below. The qualification and experience of the auditors are also briefly described

Table 7 : Auditors Profile

Evaluation Team The Auditors

Lead Auditor Abdul Haye Semail, a degree holder in B.Sc. is a forester by profession and has 15 years experience in forest harvesting and plywood industry. As a trained assessor, he has been involved in forest management, palm

mailto:[email protected]

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oil and chain of custody certification for the last 4 years. Trained by RSPO for auditing against RSPO P&C and involved in a number of plantation assessments and inspection of palm oil mill.

Auditor James S H Ong, a B.Agric Sc. holder and agronomist in SGS (M) Sdn Bhd. He has many years experience in agriculture sector in Malaysia having worked in estates as well in the agrochemical and fertiliser industry. He is well versed with agrochemical and fertiliser applications. Has undergone ISO and RSPO Lead Auditor training and involved in a number audits on oil palm plantations.

Auditor Mohd Faisal Jaafar, is a degree holder in forestry from Universiti Putra Malaysia. Faisal has a 7 years experience in operating Malaysian Timber Certification Scheme with specialization in forest management certification and forest plantation management certification. Has undergone the necessary an RSPO Endorsed Lead Auditor Course and ISO 9000 Lead Auditor course and has gathered substantial auditing experience pertaining to forest certification as well as RSPO certification.

6. THE EVALUATION

6.1 Opening meeting

An opening meeting was held at Leepang POM on 31st July 2012. The scope of the evaluation was

explained and schedules and estates to be visited were determined. Attendance record for all persons that attended this meeting is kept.

6.2 Document review

A review of the main plantation management documentation was conducted to evaluate the adequacy of coverage of the QUALIPALM Programme requirements. This involved examination of policies, management plans, systems, procedures, instructions and controls.

6.3 Sampling and Evaluation Approach

Schedule for field visits were determined during the opening meeting after the briefing given by the IOI’s management. Focus of the visit was to understand and analyse the implementation of management practices and procedures within RSPO MY-NIWG requirements.

6.4 Field Assessment

The aim of the field assessments was to determine how closely the activities in the field complied with documented management systems and QUALIPALM Programme requirements. Interviews with the staffs, operators and contractors were conducted to determine their understanding in the implementation of policies, procedures and practices that are relevant to the RSPO MY-NIWG requirements. Carefully selected sample of sites were visited to evaluate whether practices met the required performance levels.

As part of the effort to cover more areas, the verification team was divided and each member worked independently. The areas visited on a daily basis were tabulated in the schedule given below:

Table 8: Audit Plan

Date Details of the Audit

31 July 2012

(Tuesday)

9.00 am

Introduction to the audit by SGS

Briefing by the Leepang Estates and Mill on the operations and activities

Formulation of audit schedule

Field Visit @ Morisem 5 Estate: Spraying Manuring

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Harvesting Storage Line Site

2.00 pm Documentation Review

Interview stakeholders Union Leaders, Gender Committee , workers, crèche care taker

1 August2012

(Wednesday)

9.00 am

Field Visit @ Leepang 5 Estate & Permodalan 3 Estate Spraying Manuring HCV Area Riparian & Buffer zone Boundary Stone Landfill Harvesting Line site Storage Clinic Crèche

2.00 pm Documentation Review

Interview with local communities.

Interview with Gender Committee , Union, Medical Assistant / Officer

2 August 2012 (Thursday) 9.00 am

Field Visit to Estate Auditing any outstanding issues or section that has yet to be covered

Leepang Palm Oil Mill Mill records on production RE usage , water usage Site & facilities visit Supply Chain audit SOP Record Keeping Training

2.00 pm Preparation of Audit Findings

3.00 pm Closing Meeting

6.5 Summing up and closing meeting

At the conclusion of the field evaluation, preliminary findings were presented to the company management at closing meeting held on 2

nd August 2012. Observations made highlighted compliance,

partial compliance or non-conformance to the RSPO requirements.

7. EVALUATION RESULTS

Results of the evaluation are tabulated below. The findings made under each criterion are discussed where non compliances raised are raised against individual indicator of the MY-NIWG 2010.

The detailed findings that described the compliance and non-compliances (raised as NC) under each criterion are as follows:

Criterion

1.1

Oil palm growers and millers provide adequate information to other stakeholders on

environmental, social and legal issues relevant to RSPO Criteria, in appropriate language &

forms to allow for effective participation in decision making.

1.1.1 Records of requests and responses must be maintained. Compliance

Major

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MA Findings:

Records of requests and responses are maintained.

Objective evidence:

Documented procedures exist for stakeholder information request at the corporate and estate levels. Records of requests and responses were viewed at the estate level. Website provides adequate information on their plantation undertakings, corporate social responsibilities and commitments to sustainability. Information can be viewed at the following site,

http://www.ioigroup.com/Corporateresponsibility/environment_plantation.cfm Stakeholder lists for all individual estates and mill is available on site. There is a mechanism to ensure that documents are publicly available, as stipulated in the individual estate management plans. The mechanism for information request available at two different levels namely estate and corporate level. The mechanism for information request is clearly outlined in the estates’ Social Management Plan.

In practice, stakeholder requests are made either by checking the IOI website or writing a letter to the estate or making a call to the estate office. A flowchart designates how IOI will address the issue by meeting with the Social Liaison Officer or Estate Manager. The appropriate personnel will handle the complaint or request and the stakeholder informed of the outcome within 5 working days.

The company is in compliance to this requirement: Y

Criterion

1.2

Management documents are publicly available, except where this is prevented by

commercial confidentiality or where disclosure of information would result in negative

environmental or social outcomes.

1.2 1.2.1 Land titles / user rights (C 2.2) 1.2.2 Safety and health plan (C 4.7) 1.2.3 Plans and impact assessments relating to environmental and social impacts (C 5.1, 6.1, 7.1,

7.3) 1.2.4 Pollution prevention plan (C 5.6) 1.2.5 Details of complaints and grievances (C 6.3) 1.2.6 Negotiation procedures (C 6.4) 1.2.7 Continuous improvement plan (C 8.1) MA Findings:

Evidence of the above documents that is made publicly available.

Objective evidence:

IOI Leepang has developed the following documents that are made available to the auditors during the visit:

i. Safety and health plan;

ii. Environmental and social impact assessments and related management plans;

iii. Pollution prevention plans;

iv. Procedures for complaint and grievance were verified. The details and records are lacking;

v. Negotiation procedure; and

vi. Continuous improvement plan

All relevant legal documents covering land titles and licenses have been displayed for viewing. Safety and health plan as well as environmental and social impact assessment are also available. In addition, there is adequate documentation of complaints and grievances available in each estates including those that have been resolved at the mill.

http://www.ioigroup.com/Corporateresponsibility/environment_plantation.cfm

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The negotiation procedures are clearly presented in the individual management plans. The above documents are also found to be uploaded into the website to be made publicly available.


Principle 2: COMPLIANCE WITH APPLICABLE LAWS AND REGULATION

Criterion

2.1

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

regulations.

2.1.1 Evidence of compliance with legal requirements.

Compliance

Major

MA Findings:

Evidence of compliance with legal requirements.

Objective evidence:

Land titles for the visited estates are available as follows:

Land Title No. Estate/Mill

PL 096290194 dated 23 August 1980 Morisem 5

CL 095333485 dated 30 July 2001 Permodalan 3

CL 095322900 Leepang Palm Oil Mill

As reflected in the land titles, all of the said land is deemed to be planted with agricultural crop of economic values in particular oil palm.

Estate boundaries have been systematically marked in areas adjacent to other forms of land use (sensitive areas). IOI Leepang is committed to leaving a stream buffer strips at time of replanting. All of the identified buffer strips are adequately indicated in maps.


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

Minor

MA Findings:

Adequate documented and practical system, which includes written information on legal requirements.

Objective evidence:

Evidence of compliance with legal requirements –licenses displayed at company offices.

All Standard Operating Procedures are cross reference to legal requirements to ensure compliance. The list of relevant national laws has been reviewed and available in the mill and estate. The hard copies of all relevant legal documents such as laws, licences and permits are viewed at the mills and estates office.

Nevertheless, at Leepang , the list of applicable laws, regulations, permits and licenses is not practical to be monitored due to lack of expiry date and lack of person in-charge at the estates and mill level.

The company is in compliance to this requirement: Observation 01

2.1.3 A mechanism for ensuring that they are implemented. Compliance

Minor

MA Findings:

Evidence of a mechanism for ensuring that they are implemented.

Objective evidence:

IOI Corporation Bhd as a Group has established a mechanism for ensuring that all relevant laws listed are adequately implemented. As stated in the procedures, all relevant laws are implemented throughout the organization with each of the department has its

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respective personnel to monitor the implementation of the relevant laws.


2.1.4 A system for tracking any changes in the law. Compliance

Minor

MA Findings:

Availability of system for tracking any changes in the law.

Objective evidence:

The mechanism of tracking the changes of laws is contained in the IOI File No. 5. As stated in the document, the sustainability team has been appointed as the responsible personnel to monitor any changes of laws. They are also assigned to carry the following task:

Inform the mill and estates on any changes and updates of the laws listed;

To evaluate the effect of change of laws against the oil palm and mill practices; and

To assess current practices and suggest any changes to be submitted to Senior Management i.e. Group Plantation Director and Assistant General Manager.


Criterion

2.2

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

communities with demonstrable rights.

2.2.1 Evidence of legal ownership of the land including history of land tenure. Compliance

Major

MA Findings:

Legal ownership of the land including history of land tenure is available.

Objective evidence:

The IOI Leepang provided the evidences of ownership of land by providing the evidence of land titles for both POM and the supplying estates.

In addition, IOI Leepang also has provided the auditor with approval (No. 001206) for occupying and operating at the prescribed premise in accordance to the Section 18(1) of the EQA, 1974.


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

Compliance

Major

MA Findings:

The term of condition provided evidence that the company does comply with the terms of the land title.

Objective evidence:

Land titles for the visited estates are available as follows:

Land Title No. Estate/Mill

PL 096290194 dated 23 August 1980 Morisem 5

CL 095333485 dated 30 July 2001 Permodalan 3

CL 095322900 Leepang Palm Oil Mill

As reflected in the land titles, all of the said land is deemed to be planted with agricultural crop of economic values in particular oil palm.


2.2.3 Evidence that boundary stones along the perimeter adjacent to state land and Compliance

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other reserves are being located and visibly maintained. Minor

MA Findings:

Inadequate evidence that boundary stones along the perimeter adjacent to state land and other reserves are being located and visibly maintained.

Objective evidence:

Estate boundaries have been systematically marked in areas adjacent to other forms of land use (sensitive areas). IOI Leepang has a special mapping team with accurate GPS equipment for boundary verification. All visited estates have their boundary marked with boundary markers. However, the auditor note that one area bordering with Sg. Simpang Forest Reserve is not adequately marked with boundary markers.

The company is in compliance to this requirement: N (Minor CAR 01)

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

Compliance

Minor

MA Findings:

The unit does not have any land disputes recorded.

Objective evidence:

The unit does not have any land disputes recorded. But a system to resolve land disputes is documented in ‘Grievance Procedure for Land Owner Issues’ which is detailed in the social management plan for estates and mill.


Criterion

2.3

Use of the land for oil palm does not diminish the legal rights, or customary rights, of other

users, without their free, prior and informed consent.

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

Compliance

Major

MA Findings:

There are no claims on legal or customary rights exist for the estate.

Objective evidence:

Currently, there are no claims on legal or customary rights exist for the estate. Customary use of land for community purposes have been identified either on maps (places of worship, burial grounds, and archaeological site) and maintained.


2.3.2 Map of appropriate scale showing extent of claims under dispute. Compliance

Major

MA Findings:

Refer to Indicator 2.3.1

Objective evidence:

Customary use of land for community purposes have been identified either on maps (places of worship and burial grounds) and maintained.


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

Compliance

Minor

MA Findings:

Refer to Indicator 2.3.1

Objective evidence:

Currently, there are no claims on legal or customary rights exist for the estate.

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

Criterion

3.1

There is an implemented management plan that aims to achieve long-term economic and

financial viability.

3.1.1 Annual budget with a minimum 2 years of projection.

Compliance

Major

MA Findings:

Annual budget with a minimum 2 years of projection.

Objective evidence:

Annual budget for both estates and mill is available covering both operation and management of the estates and mill. In addition, the Budgets included allocations for social & environmental/biodiversity conservation programme.


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

Compliance

Minor

MA Findings:

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

Objective evidence:

Ten year replanting programme for each estate are available. Plantation management plan is also established that take into consideration the availability of resources and crop production environmental and social scenario as well as monitoring programme for each of the estates within the production unit. In addition the maps for each estate are also available within the plan that indicates the boundary of the estates as well as the blocks or the compartment. The rivers and streams within the estates were marked together with the access road.

The annual plan is only in the form of annual budget determined by the Headquarters for each estate. The budget include allocation for the operation, estimate on expenses for harvesting, social programmes as well as possible environmental safeguards.


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

Criterion

4.1

Operating procedures are appropriately documented and consistently implemented and

monitored.

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

Major

MA Findings:

Availability of documented Standard Operating Procedures (SOP) for estates and mills.

Objective evidence:

Procedures are observed to be well documented at group level and then translated into StOPs for individual estates where needed. Procedures exist for most operations both in the estates and mills in the form of written documents. The StOPs is observed to be reflecting best industry practices as detailed in IOI’s agricultural policy document.

StOPs for crop production and field maintenance are consistently implemented in all the estates evaluated. Where field management is concerned, the operating procedures have become standard practice understood by all field management staff. Procedures for the

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whole crop management cycle are provided to all management staff and training provided to ensure standard and consistent implementation. Input from the research division for continuous StOP review and improvement demonstrates the implementation of an adaptive management approach.


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

Compliance

Minor

MA Findings:

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

Objective evidence:

A comprehensive monitoring framework is in place, especially for field operations is in place. The general estate/mill management hierarch ensures that relevant procedures both in the estates and in mill are implemented. The management structure of all the estates and mills ensures that procedures are effectively implemented and monitored. General monitoring is in the form of task supervision and satisfactory task completion reports to senior management in individual estates and mills. A series of daily task completion forms serving as monitoring documents exist for all important field and mill operations. These serve as records of implementation and monitoring. Procedures for environmental monitoring exist and the same level of management control is placed on these procedures.


Criterion

4.2

Practices maintain soil fertility at, or where possible improve soil fertility to a level that

ensures optimal and sustained yield.

4.2.1 Monitoring of fertilizer inputs through annual fertilizer recommendations. Compliance

Minor

MA Findings:

Evidence of monitoring of fertilizer inputs through annual fertilizer recommendations.

Objective evidence:

Verification during a visit to the sampled estates evidenced that there has been a high standard of soil fertility maintenance implementation that meets normal industry practice of ensuring optimal nutrition for planting material according to soil type and climate. The fertilizer inputs based on recommendation made by the Agronomy Manager of IOI are recorded and monitored. Several sampled fertilizer application are recorded as evidence:

Estates Recommendation

Morisem 5 Amended fertilizer application for applying recommended by the Agronomy Manager dated 28 June 2012

Permodalan 3 Fertilizer recommendation for applying Eppawela Rock Phosphate (ERP) in Block 93A. Recommendation by the Agronomy Manager dated 28 June 2012

Fertilizer recommendation for applying Murate of Potash (MOP) in Block 06A. Recommendation by the Agronomy Manager dated August 2012

Leepang 5 Fertilizer recommendation for applying NK fertilizer in Block 96D. Recommendation by the Agronomy Manager dated 15 May 2012


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

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status. Minor

MA Findings:

Inadequate of periodic tissue and soil sampling to monitor changes in nutrient status.

Objective evidence:

A programme is in place that takes annual nutrient samples from both leaf tissue and soil. These are used to assess the nutrient state of the palms and their soils and used to guide subsequent fertiliser needs.

In practice, check on nutrient status in the field is undertaken by foliar (frond) sampling supported by soil nutrient status analysis. This is done at the very least annually to establish nutrient uptake by the palms and also to determine the annual fertilizer application recommendations. The monitoring results are presented in the form of a fertilizer recommendation report for each estate. IOI’s agronomic unit under the research division systematically undertakes monitoring and recommends changes to improve soil fertility to ensure optimal and sustained yield.

Despites that the soil sampling analysis has been conducted throughout all visiting estates, the auditing team note that the similar analysis is not conducted in the Morisem 5 estate.


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

Minor

MA Findings:

Monitoring the area on which EFB, POME and zero-burn replanting is applied, is not implemented.

Objective evidence:

No evidence of monitoring of application of EFB on the field to maintain soil fertility at, or where possible improve soil fertility to, ensure optimal and sustain yield.


Criterion

4.3

Practices minimise and control erosion and degradation of soils.

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

Compliance

Minor

MA Findings:

Availability of documented evidence of practices minimizing soil erosion and degradation (including maps).

Objective evidence:

Management document to minimize soil erosion and degradation for Leepang production unit is captured two documents as follows:

Group Standard Operating Procedures (StOP); and

Good Agricultural Practices.

In addition, the production unit also has a Slope Map indicating the following areas:

0-25 degrees;

26-50 degrees; and

51-75 degrees.

Based on records, a total of 227 ha of area of < 25 degree in slope has been identified and marked on map as well as on the ground. Such areas are excluded from plantation and be conserved as a protection area.

The slope areas as indicated above also are captured within the Environmental Impact

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Assessment (EIA), management action plans, High Conservation Value (HCV) Management Plans and Continuous Improvement Plans .


4.3.2 Avoid or minimize bare or exposed soil within estates. Compliance

Minor

MA Findings:

Evidence bare or exposed soil in one area within estates.

Objective evidence:

Observation in Morisem 5 Estate evidenced that the soil erosion on the 227ha of unplanted hilly area is causing siltation on the main drains within the peat areas between Leepang 3 and Morisem 5.


4.3.3 Presence of road maintenance programme. Compliance

Minor

MA Findings:

Road maintenance programme is available.

Objective evidence:

The documents required for road maintenance are available. Each estate has a programme, budget and timetable for implementation of work.

Verification during field visit evidenced that roads are observed in good condition and effective for crop evacuation. Surface run offs from the road are observed to be diverted back to fields so that the soil are retained.


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

Compliance

Minor

MA Findings:

Lack of documented water management programme is available to minimise peat soils subsidence.

Objective evidence:

There is evidence of peat soil within the estate (Morisem 5 Estate) in the Fertilizer Recommendation Reports for January 2012 to December 2012 from the Agronomist of IOI. However, there is no soil map available to locate the peat area in the estate. In addition there is also no water management table to monitor the peat subsidence rate.

(refer to Minor CAR 13)

Compliance to this requirement: N(Refer to Minor CAR 13 )

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

Compliance

Minor

MA Findings:

Best management practice is not in place for fragile and problem soils.

Objective evidence:

Although there is a comprehensive soil map available at the production unit. The auditing team note that there is no soil map available to locate peat area within the estate and hence rendered such area not to be managed under the best management practices.

(refer to Minor CAR 13)

The company is in compliance to this requirement: N(Refer to Minor CAR 13 )

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Criterion

4.4

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

4.4.1 Protection of water courses and wetlands, including maintaining and restoring appropriate riparian buffer zones at or before replanting along all natural waterways within the estate.

Compliance

Major

MA Findings:

Improper demonstration of the protection of water courses and wetlands, including maintaining and restoring appropriate riparian buffer zones at or before replanting along all natural waterways within the estate.

Objective evidence:

Based on the topography maps verified during the main assessment, all natural streams identified are marked with red colour painted on the palms.

Identification and demarcation of such area and be classified as riparian buffer zones are conducted in accordance to the Sabah’s Water Resources Enactment (1998) using the guidelines provided by the Department of Drainage and Irrigation (DID) of Sabah. As required within the enactment as well as DID’s guidelines, the markings of riparian buffer zones are conducted as follows:

River width Width of Riparian Buffer Zones (m)

>40 50

20 - 40 40

3-20 20

<3 5

Although Leepang production unit has established and demarcated the buffer zones along the rivers as per required in the standard, the auditing note that several seasonal stream areas within Morisem 5 and Leepang 3 Estates has been marked as riparian buffer zones that may inflict problem relating to the management of such area in the future due to the seasonal flowing nature of the stream. To cater this problem, the training and understanding is required to the plantation staff to ensure identification, demarcation and enhancement is implemented.


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

Compliance

Major

MA Findings:

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

Objective evidence:

Field visit during the main assessment evident that no construction of bunds, weirs and dams were observed in the estates. All provisions stipulated in the Department of Irrigation and Drainage (DID) is fulfilled.


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

Compliance

Major

MA Findings:

Outgoing water into main natural waterways is monitored at a frequency that reflects the estates and mills current activities which may have negative impacts.

Objective evidence:

In practice, monitoring of water quality is conducted through the following activities:

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Implementing Water quality index (WQI). The sampling is conducted at least once every six months. Amongst elements captured within the analysis water trending as well as water quality index using parameters guided by the DID guidelines. Two WQI has been observed and verified as follows:

o WQI sampling done 18/7/2012 at 3 sampling along the tributaries Natural Stream within Morisem 5 estate. The analysis is done at the IOI research Centre, Sabah; and

o WQI sampling done 22/7/2012 at 3 sampling along the tributaries Natural Stream within Permodalan 3 estate. The analysis is also done at the IOI research Centre, Sabah

Drinking water is tested every 6 months. The testing result is sent to external lab. Based on records, the latest sampling result has been conducted on 27

th July 2012.


4.4.4 Monitoring rainfall data for proper water management. Compliance

Minor

MA Findings:

Monitoring rainfall data for proper water management is evident.

Objective evidence:

Rainfall is being monitored and records are kept. Meters to monitor water abstraction and supply to the mill have been installed and water usage is being monitored.


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

Minor

MA Findings:

Monitoring of water usage in mills (tonnage water use/tonne FFB processed). Is conducted.

Objective evidence:

Flow meters with certificate for calibration have been applied for water usage monitoring in the mill for in-coming raw water and after-treatment. Evidence for monitoring water utilisation is found to be adequate.

Water usage for every tonne FFB processed is also monitored on a monthly basis.


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

Compliance

Minor

MA Findings:

Water drainage into protected areas is adequately avoided.

Objective evidence:

Documents concerning a Water Management Plan viewed. Drainage to protected area avoided as far as the management of Leepang production unit as concerned. Based on the observation made during the field visit, there is no drainage into the protected area observed.

As reflected in the Water Management Plan, appropriate mitigating measures shall be employed and implemented following consultation with relevant stakeholders. All concerns raised shall be recorded in the external complaints record books.


4.4.7 Evidence of water management plans. Compliance

Minor

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MA Findings:

Availability of water management plans.

Objective evidence:

Water management Plan for Leepang Group covering period from July 2012 – July 2017 has been established and made available to the auditing team during the main assessment. This document covers the following elements:

Conserving sources for abstraction;

Managing riparian areas;

Contamination by estate and mill activities;

Monitoring ground and surface water quality, and

Consumption of water.


Criterion

4.5

Pests, diseases, weeds and invasive introduced species are effectively managed using

appropriate Integrated Pest Management (IPM) techniques.

4.5.1 Documented IPM system. Compliance

Minor

MA Findings:

Documented IPM system is available.

Objective evidence:

The approach to IPM is well integrated within the StOP document of Leepang production unit. This covers weeding, diseases and pests management. An adaptive management approach is taken. Biological control methods are employed, with routine field monitoring where a census is taken of indicator species. When tolerance thresholds are breached, a chemical response is initiated. Census records viewed.


4.5.2 Monitoring extent of IPM implementation for major pests. Compliance

Minor

MA Findings:

Monitoring extent of IPM implementation for major pests is conducted.

Objective evidence:

In all the estates evaluated, elements of IPM have been observed. Pest and weed infestation is recorded as minimal in these estates. The application of biological control is conducted and the use of Barn Owls for rat control is evident. In addition, the usage of beneficial predator and parasitoid host plants e.g. Tunera subulata, Cassia cobanensis, Antigonon leptopus, is also observed to be implemented within the estates visited. The implementation of the IPM is intensively monitored by IOI Leepang and a phased approach has been taken for such activities.

Interviews with the Estate management staff evident that they are aware of the toxicity indices for all pesticides used in the estate and appropriate briefing and training regard this is given.

Example of monitoring of IPM implementation are as follows:

Monitoring of rat damage is done from the crop sent to the mill that is recorded in the document ‘FFB Delivery and Assessment Report‘. Level of FFB damage is also captured within the document. Summary of such records are done in a report known as ‘Off Quality Ranking’ where rat damage is recorded.


4.5.3 Recording areas where pesticides have been used. Compliance

Minor

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MA Findings:

Evidence of recording areas where pesticides have been used.

Objective evidence:

StOP is available for the control of all major pests and has been consistently implemented. Records of application were viewed and field visits maid confirming application was made according to current schedules. Records of chemical usage are available for both mature and immature palms in the form of measurement units such as litres or kilograms. Records of pesticides program planned for each block and areas treated are also available.


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

Compliance

Minor

MA Findings:

Evidence of monitoring of pesticide usage units per hectare or per ton crop e.g. total quantity of active ingredient (a.i.) used/ tonne of oil.

Objective evidence:

Monitoring of pesticides usage for units per hectare or per ton crop is recorded in the Summary of Pesticides Usage per Hectare per Ton FFB Production. Data is recorded based on the type of pesticides used and recorded on a monthly basis. Observed during the audit the records for year 2007 to 2012 are available.


Criterion

4.6

Agrochemicals are used in a way that does not endanger health or the environment. There is

no prophylactic use of pesticides, except in specific situations identified in national Best

Practice guidelines. Where agrochemicals are used that are categorised as World Health

Organisation Type 1A or 1B, or are listed by the Stockholm or Rotterdam Conventions,

growers are actively seeking to identify alternatives, and this is documented.

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

Compliance

Major

MA Findings:

Written justification in Standard Operating Procedures (SOP) of all agrochemicals use is available.

Objective evidence:

The written justification of all pesticides covering both weedicide and rodenticide used within the IOI Leepang operations are captured within the StOPs document.


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

Compliance

Major

MA Findings:

Pesticides use are those that officially registered under the Pesticides Act, 1974 (Act 149) and the relevant provision (Section 53A); and in accordance with USECHH Regulations (2000).

Objective evidence:

All agrochemicals used are on the official registered as required by the Malaysian pesticides act 149 (1974). The IOI plantation group has reduced the number of chemical in its estates. Glyphosate is the main systemic herbicide used for general field spraying.

Paraquat is no longer used within the IOI Leepang operations area following the memo from the top management ceasing the usage of such chemicals in IOI plantations.

Records indicate that spraying rounds are being reduced in mature areas indicating positive

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action by the estates evaluated.


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

Compliance

Major

MA Findings:

Pesticides used in estates are not disposed of in accordance with the requirements of the standard.

Objective evidence:

StOPs for the use of Pesticides clearly emphasizing procedure in storing the pesticides used in the estate. Pesticides used in the estates observed to be stored appropriately in a closed room with proper ventilation chamber and adequate label and at the designated area. Observed also the hazardous mark paste on the wall depicting the toxicity of the pesticides to the human health.

The StOPs for the use of Pesticides emphasize on the use of triple rinse and piercing method to dispose of the used chemical containers. All estates visited are found to be adequately implementing the triple rinse and piercing method. However, the auditing team observed that triple rinsing method inconsistently implemented in Morisem 5 estate.

The company is in compliance to this requirement: N (Major CAR 04)

4.6.4 All information regarding the chemicals and its usage, hazards, trade and generic names must be available in language understood by workers or explained carefully to them by a plantation management official at operating unit level.

Compliance

Major

MA Findings:

Information regarding the chemicals and its usage, hazards, trade and generic names was not adequately made available in language understood by workers or explained carefully to them by a plantation management official at operating unit level.

Objective evidence:

Chemical storage is observed to be satisfactorily stored according to the Malaysian Occupational Safety and Health and pesticide regulatory requirements. Material Safety Data Sheets (MSDS) are available for chemicals stored and the relevant personnel well versed in the information in these sheets.

Nevertheless, the auditing team noted that MSDS for herbicide Starane has the wrong active ingredient as observed in Morisem 5 estate. In addition, MSDS for Rattus and Matikus are not available at the Leepang 5 estate store.


4.6.5 Annual medical surveillance as per CHRA for plantation pesticide operators. Compliance

Major

MA Findings:

Annual medical surveillance as per CHRA for plantation pesticide operators is available.

Objective evidence:

Annual medical surveillances are found to be conducted for all visiting estates. All surveillance is conducted by the Department of Occupational Safety and Health (DOSH) registered doctor.


4.6.6 No work with pesticides for confirmed pregnant and breast-feeding women. Compliance

Major

MA Findings:

No work with pesticides for confirmed pregnant and breast-feeding women.

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Objective evidence:

Based on the employment record, the auditing team observed that there are several women employed either for handling the pesticides in the store room or practicing pesticides spraying in the field. Nevertheless, their monthly medical surveillances confirmed that none of them are pregnant or breast-feeding women.


4.6.7 Documentary evidence that use of chemicals categorised as World Health Organisation Type 1A or 1B, or listed by the Stockholm or Rotterdam Conventions and paraquat, is reduced and/or eliminated. Adoption of suitable economic alternative to paraquat as suggested by the EB pending outcome of the RSPO study on IWM.

Compliance

Minor

MA Findings:

Documentary evidence that use of chemicals categorised as World Health Organisation Type 1A or 1B, or listed by the Stockholm or Rotterdam Conventions and paraquat, is reduced and/or eliminated is available.

Objective evidence:

All estates visited has implementing zero paraquat policy and no longer using paraquat in their spraying activity following the memo from the top management ceasing the usage of

such chemicals in IOI plantations. All chemicals that have been used are registered chemicals and approved by the relevant local authority .


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

Compliance

Major

MA Findings:

No evidence of aerial spraying.

Objective evidence:

No aerial spraying application observed in the operation area for all estates visited.


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

Compliance

Minor

MA Findings:

No evidence of chemicals residues in CPO testing, as requested and conducted by the buyers.

Objective evidence:

No buyers have requested for testing hence there is no evidence.


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

Compliance

Minor

MA Findings:

Records of pesticide use (including active ingredients used, area treated, amount applied per ha and number of applications) are maintained.

Objective evidence:

Monitoring of pesticides usage for units per hectare or per ton crop is recorded in the Summary of Pesticides Usage per Hectare per Ton FFB Production. Data is recorded based on the type of pesticides used and recorded on a monthly basis. Observed during the audit the records for year 2007 to 2012 are available.

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Criterion

4.7

An occupational health and safety plan is documented, effectively communicated and

implemented.

4.7.1 Evidence of documented Occupational Safety Health (OSH) plan which is in compliance with OSH Act 1994 and Factory and Machinery Act 1967(Act 139).

Compliance

Major

MA Findings:

Inadequate implementation of the Occupational Safety and Health (OSH) Plan in compliance with the OSH Act 1994 and Factories and Machinery Act 1967 (Act 139).

Objective evidence:

Safety and Health Plan for 2012 is available covering the following activities:

OSHA and regulations

Emergency Response Plan

Inspection

Performance and Monitoring

Vehicle Maintenance

Annual Training Programme

In compliance with Occupational Safety and Health Act, 1994, a Safety and Health Committee has been established both at the individual estates and palm oil mill level. All Safety and Health Committee are chaired by the estate and the mill manager. The appointment letter for all members of Safety and Health Committee Meeting is also available covering both workers and employers representatives.

Based on records, the Safety and Health Committee Meeting has been conducted at a quarterly basis as required by the Occupational Safety and Health Act, 1994. Records of meeting encompassing the dates of the Meeting and the Minutes of the Meeting held are maintained. As of 2012, the following evidence captured for the visited estate and mill:

Leepang 5 – Meeting held twice i.e. on 29 February and 25 May; and

Palm Oil Mill - Meeting held thrice i.e. on 18 January, 13 April and 13 July

Furthermore, Safety and Health Office together with one assistant are appointed at the regional level i.e. at Sabah State. Nevertheless, to further synchronize the implementation of safety and health aspects of the Leepang Production Unit, IOI Leepang has appointed the Safety and Health Coordinator at estates and palm oil mill level that are appointed among the assistant managers. Training are found to be given by the Safety and Health Officer to the Safety and Health Coordinators during the Meeting with the Secretary of the Safety and Health Committee on 13 Jan 2011. The record of such training in the form of Minutes of the Meeting is kept and made available to the auditor during the Main Assessment.

First Aid Kit and Fire Extinguisher equipment is available at the easily access location with clear and adequate sign in place as well as being carried together with mandore to the field. Inspection to the first aid item within the first aid kit evidenced that the item is adequate and in good, clean condition with sufficient emergency contact number to be contacted should there is emergency case occur. However, verification at one of first aid kit in Leepang 5 Estate found that there is no emergency telephone number available in the kit. In addition, the auditing team note that no first aid kit available with mandore at Block 93A in Morisem 5 Estate during interview.

In addition, the Hazard Identification, Risk Assessment and Risk Control (HIRARC) as well as Chemical Health Risk Assessment (CHRA) are conducted covering all operations and elements found within the production unit. Both assessments are found to be reviewed annually. However, inspection at the HIRARC evidenced that there is inadequate

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preventive and protective measures (mitigation) for high risk activities to ensure reducing Lost Time Accident (LTA) rate.

In addition, the CHRA found not to include apron as one of the element to be assessed for works handling with chemicals in particular pesticides.

The auditing team also verified and inspects the Emergency Response Procedure established within the production unit. Nevertheless the auditing team note that the Emergency Response Procedure is not updated as there are several information that is deemed obsolete yet still included in the procedure.


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

Compliance

Major

MA Findings:

Records of all accidents are kept and periodically reviewed at quarterly intervals.

Objective evidence:

Records of accidents are kept within the Accident Investigation Report. All accident occurs and reported is discussed and reviewed during the Occupational Safety and Health Meeting. Any outcome towards the mitigation and preventive measures to avoid the same incidence and accident occur is kept in the minutes of the meeting. The auditing team also note that there is evidence on the use of JKKP 8 that is reviewed and submitted to DOSH on a yearly basis. Latest submission of the form is on 26 January 2012.

As for the mill, JKKP 8 also is used and latest submission was on 16 Jan 2012.


4.7.3 Workers should be covered by accident insurance. Compliance

Major

MA Findings:

Workers are adequately covered with accident insurance.

Objective evidence:

All workers are adequately covered with insurance. For local workers, they are covered under Social Security Organization (SOCSO) and Employees Provident Fund (EPF) while for foreign they are covered under group insurance. There is also evidence of sampled insurance policy for foreign workers available that are as follows:

Estate/Mill Policy No.

Permodalan 3 FW030406 covering Oct 2011 to Sept 2012

D09WFWC8610177KL Oct 2011 to Sept 2012

Leepang POM FW030611 covering Oct 2011 to Sept 2012

D09WFWC8610177KL Oct 2011 to Sept 2012


Criterion

4.8

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

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

Compliance

Major

MA Findings:

Insufficient training conducted covering safety and health as well as chemical handling.

Objective evidence:

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Training plan is available in the Occupational safety and Health (OSH) Plan. Training records kept for 2012 that are shown to the auditors for the visited estates and palm oil mill are as follows:

Training Details Trainer Date No. Of

Participants

Handling hazardous chemicals

OSH Officer 17 July 2012 20

Chemical Safety Data Sheet

OSH Officer 17 Jul 2012 20

Spraying Assistant manager

6 Jul 2012 8 workers

Fertilizer application Assistant manager

7 jul 2012 12 workers

Health Training (Introduction and Control of Penyakit Berjangkit)

Safety Officer from Health Office in Kinabatangan

24 Feb 2012 86 (including participants from other estates)

Notification of Accidents, Dangerous Occurrence, Occupational Poisoning and Occupational Diseases (NADOPOD)

OSH officer 11 Jan 2012 33

Sexual Harassment Training

Estate Manager 27 July 2012 26

Material Safety Data Sheet and and Chemical Safety Data Sheet

Asistant Estate Manager

23 July 12

PPE Safety officer and Manager

5 July 40

First Aid Kit Estate Dresser 28 June 40 – mandore is also attend the training

Safe working conditions and continuous maintenance procedure for operating machine

Mill and Training Supervisor

20 July 13

Role of OSH Committee

OSH Officer 13 July 13

First Aid Kit Training Medical Assistant from Leepang 1

11 July 21

Safe Operating Procedure for Loading Ramp

Cadet Engineer and Supervisor

12 May 5

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Station

Although IOI Leepang has conducted numerous trainings relating to estate and mill management, interview during the field audit with several mandores evidenced that a few mandores are found to be not attending the first aid kit handling training. Interview also conducted with Estate Hospital Assistants and found that the Estate Hospital Assistant are not train on the chemical use and related laws as per required by the RSPO requirements.


Principle 5 : ENVIRONMENTAL RESPONSIBILITY AND CONSERVATION OF NATURAL RESOURCES AND

BIODIVERSITY

Criterion

5.1

Aspects of plantation and mill management, including replanting, that have environmental

impacts are identified, and plans to mitigate the negative impacts and promote the positive

ones are made, implemented and monitored, to demonstrate continuous improvement.

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

Compliance

Major

MA Findings:

Inadequate documented aspects and impacts risk assessment that is periodically reviewed and updated.

Objective evidence:

The ‘Environmental Impact Assessment and Management Action Plans’ for each estate is available covering period of June 2012 until May 2017. The document dated 20

th June

2012 provides a list of aspects and impacts, given as a list of contents, for which a response is planned. In addition, the identification of aspect and impacts is evident within the document and there are adequate guidelines described within the document for reviewing the gaps identified. However, the auditing team note that the document does not includes stakeholder consultation as part of their assessment process.


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

Compliance

Minor

MA Findings:

Evidence of environmental improvement plan to mitigate the negative impacts and promote the positive ones, is developed, implemented and monitored.

Objective evidence:

Environmental Impact Assessment (EIA) is available covering period of June 2012 until May 2017. The document dated 20

th June 2012 is subjected to annual review for

continuous improvement.


Criterion

5.2

The status of rare, threatened or endangered species (ERTs) and highly conservation value

habitats, if any, that exist in the plantation or that could be affected by plantation or mill

management, shall be identified and their conservation taken into account in management

plans and operations.

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

Compliance

Major

MA Findings:

Inadequate identification and assessment of HCV habitats and protected areas within land holdings; and attempt assessments of HCV habitats and protected areas surrounding landholdings.

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Objective evidence:

HCV assessment on the plantation has been conducted where report for each estate is available. However, the identification and assessment of HCV habitats and protected areas within and surrounding landholding did not include potential ERTs.


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

Major

MA Findings:

Management plan for HCV habitats (including ERTs) and their conservation inadequately implemented.

Objective evidence:

Management plan for identified HCV habitat has been viewed and evidence shown that there has been consultation with stakeholders. Management plan for identified HCV habitat has been developed that includes specific and time bound planning actions supported by budget allocation. However, based on the records of stakeholder consultation conducted, the auditor note that local communities in particular orang sungai and experts are not consulted during identification and assessment of HCVs.


5.2.3 Evidence of a commitment to discourage any illegal or inappropriate hunting, fishing or collecting activities, and developing responsible measures to resolve human-wildlife conflicts.

Compliance

Minor

MA Findings:

Lack of commitment to discourage any illegal or inappropriate hunting, fishing or collecting activities, and developing responsible measures to resolve human-wildlife conflicts.

Objective evidence:

No proper signage allocated for all identified HCVs within the HCV assessment document.


Criterion

5.3

Waste is reduced, recycled, re-used and disposed of in an environmentally and socially

responsible manner.

5.3.1 Documented identification of all waste products and sources of pollution. Compliance

Major

MA Findings:

Evidence of documented identification of all waste products and sources of pollution.

Objective evidence:

The pollution prevention plan is available within the EIA document. The plan contains the identification of the pollutions, the environmental impact of the pollution, the improvement (action) plan, documents that need to be reviewed and management review comments. As of the date of the audit, the following pollution source has been identified as follows:

Empty Fruit Bunch (EFB) (mill waste product)

Boiler ash (mill waste product after burning fibre and shell and

Disposal of spent oil / lubricants and empty chemical containers

Diesel/fossil fuel used

Office/domestic waste

Pesticides derived from pesticides store and pesticides pre-mixing area

Scrap metal and used tyre

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

Compliance

Minor

MA Findings:

Inadequate implementation of operational plan to avoid or reduce pollution.

Objective evidence:

Operational plan have been developed but not implemented adequately to avoid or reduce pollutions, for example; operational plan for domestic waste is not properly implemented to reduced, recycled, re-used and disposed off in an environmentally and socially responsible manner. Scheduled waste, recyclable material and chemical containers found in the landfills in all visited estates.


5.3.3 Evidence that crop residues / biomass are recycled (Cross ref. C4.2). Compliance

Minor

MA Findings:

Adequate evidence that crop residues / biomass are recycled.

Objective evidence:

Standard Operating Procedures (StOP) for Empty Fruit Bunch (EFB) application is available dated Sept 2007. The StOP specify procedures for applying the EFB as follows:

Assistant manager to brief the EFB team daily on the methods, rate of application and safety issues prior to manuring.

For immature palm (1-2 years) field apply single layer of 2 concentric rings.

The distance of about 15-30 cm from palm bole should not be applied with EFB.

The initial fertilizer application should be in this particular area without EFB.

In young mature palm (3-6 years) field area apply EFB about 250-300 kg per palm. Apply single layer of EFB on either sides of the palm without canopy drip and each side will receive 125-150 kg of EFB.

The EFB application should not hinder the plantations operations like harvesting and crop evaluation.

In mature palm (>7 years) apply single layer of EFB at the rate of 1 tonne of EFB for every 4 palms along he inter row near to frond stacks.

All supplementary fertilisers are applied in accordance to StOP for Fertilizer application for Immature and Mature Palms, Index No. 8.1.

There is evidence of EFB application captured in EFB application/EFB Mulching record that is recorded on a monthly basis covering the following details:

Items recorded date;

Time;

Ticket no from mill;

Field no; and

Quantity of EFB (in metric tonne) applied.

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Field evidence shows that the crop residues were returned to field. E.g. pruned fronds are piled well in inter-rows and subsequently returned to soil. Biomass like EFB, shell and fibre are used as renewal energy for the refinery and oil mills.

Palm Oil Mill Effluent (POME) is processed at the mill and treated before being transferred to land application. Prior to the application, the POME is sampled, tasted and recorded on a monthly basis. The test is conducted according to the parameter such as pH, Total Suspended Soils (TSS), Ammonium Nitrogen (AN), Total Nitrogen (TN), BOD, Oil and Grease, COD, Total Solids (TS) and Water Temperature. Latest report for June 2012 is available and found that all parameter level for final discharge are complied with the standard limits stipulated under the Environmental Quality (Prescribed Premises) (Palm Oil Mill) Regulations, 1977.


Criterion

5.4

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

5.4.1 Monitoring of renewable energy use per tonne of CPO or palm product in the mill. Compliance

Minor

MA Findings:

Renewable energy use per tonne of CPO or palm product in the mill is monitored.

Objective evidence:

Leepang Palm Oil Mill has recorded the actual weight of FFB and fibers used for boiler. Trend of the renewable fuel input against the energy produced for every metric tonne FFB processed recorded on a monthly basis is available. Based on records average energy derived from fibre and shell produced for every metric tonne FFB processed is 29.51Kwh/mt.


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

Compliance

Minor

MA Findings:

Evidence of monitoring of direct fossil fuel use per tonne of CPO or kW per tonne palm product in the mill.

Objective evidence:

Records of usage of fossil fuel are available and compared to the volume of the FFB processed. For the financial year 2010-2011, the average consumption for every metric tonne FFB processed is 1.82lit/mt FFB while for financial 2011-2012, total consumption is 2.11 lit/mt FFB.


Criterion

5.5

Use of fire for waste disposal and for preparing land for replanting is avoided except in

specific situations, as identified in the ASEAN Guidance or other regional best practice.

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

Compliance

Major

MA Findings:

No evidence of open burning.

Objective evidence:

Observation during the field visit showed no evidence of open burning on site.


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

Compliance

Minor

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MA Findings:

Previous crops are felled/mowed down, chipped/shredded and windrowed.

Objective evidence:

Refer indicator 5.5.1. In general, all felled trunks are chipped and windrowed and placed along rows.


5.5.3 No evidence of burning waste (including domestic waste). Compliance

Minor

MA Findings:

There is no evidence of burning of domestic waste at the line site

Objective evidence: Visit to estates line site confirmed no evidence of burning of domestic waste.


Criterion

5.6

Plans to reduce pollution and emissions, including greenhouse gases, are developed,

implemented and monitored.

5.6.1 Documented plans to mitigate all polluting activities (Cross ref to C5.1). Compliance

Major

MA Findings:

Inadequate implementation of documented plans to mitigate all polluting activities.

Objective evidence:

The pollution prevention plan is available within the EIA document. The plan contains the identification of the pollutions, the environmental impact of the pollution, the improvement (action) plan, documents that need to be reviewed and management review comments. Implementation wise, the auditing team note that that wastewater analysis done (weekly) and submitted on a monthly basis. These include stack sampling (2 x per year) as well as ambient air monitoring (4 x per year). There is also evidence of legal compliance for FD: BOD < 5,000ppm. It is evidenced that for 2010 and 2011 the BOD recorded was < 150ppm. Nevertheless, the auditor note that there is evidence of excessive EFB mulching applied at palm near to the road side in Permodalan 3 Estate resulting in possible significant GHG (methane) releases.


5.6.2 Plans are reviewed annually. Compliance

Minor

MA Findings:

Evidence of plans are reviewed annually

Objective evidence:

The above mentioned EIA document is subjected to be reviewed annually and is due for review in June 2013. This will be verified during the next surveillance audit.


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

Compliance

Minor

MA Findings:

Lack of monitoring and reducing peat subsidence rate through water table management.

Objective evidence:

There is evidence of peat soil within the estate (Morisem 5 Estate) in the Fertilizer

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Recommendation Reports for January 2012 to December 2012 from the Agronomist of IOI. However, there is no soil map available to locate the peat area in the estate. In addition there is also no water management table to monitor the peat subsidence rate.

(Minor CAR 13)


PRINCIPLE 6: RESPONSIBLE CONSIDERATION OF EMPLOYEES AND OF INDIVIDUALS AND

COMMUNITIES BY GROWERS AND MILLERS

Criterion

6.1

Aspects of plantation and mill management, including replanting, that have social impacts

are identified in a participatory way, and plans to mitigate the negative impacts and promote

the positive ones are made, implemented and monitored, to demonstrate continuous

improvement.

6.1.1 A documented social impact assessment including records of meetings. Compliance

Major

MA Findings:

Evidence of documented social impact assessment including records of meetings.

Objective evidence:

Social Impact Assessment (SIA) also is available covering the period of June 2012 till May 2017 and dated June 2012 that is done with the participation of identified stakeholders. Records of all meetings available. The SIA is viewed as an active impact assessment document where a reasonable amount of consideration has been given to mitigate social impacts for employees and communities affected by the plantations and mill.

The SIA has a social action plan which seeks to resolve social issues adequately, in terms of clearly outlining the responsibilities for mitigation and monitoring. Maps delineating locations of stakeholders and social economic profiling is also provided. IOI Leepang is seen to engage with identified stakeholders in a participatory manner.


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

Compliance

Minor

MA Findings:

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

Objective evidence:

The Social Impact Assessment (SIA) for each of the estates is available and done with the participation of identified stakeholders. Records of all meetings available. However, the auditing team note that the demographic background for capturing data within the SIA do not consider other age groups such as children and old people.


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

Compliance

Minor

MA Findings:

Lack of a timetable with responsibilities for mitigation and monitoring is reviewed and updated as necessary.

Objective evidence:

The Social Impact Assessment (SIA) for each of the estates is available and done with the participation of identified stakeholders. The SIA has a social action plan which seeks to resolve social issues adequately, in terms of clearly outlining the responsibilities for mitigation and monitoring. However, the auditing team note that the mitigation measures in the form of action plan is not reliable to ensure the implementation of the SIA.

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Criterion

6.2

There are open and transparent methods for communication and consultation between

growers and/or millers, local communities and other affected or interested parties.

6.2.1 Documented consultation and communication procedures. Compliance

Major

MA Findings:

Evidence of documented consultation and communication procedures.

Objective evidence:

The consultation and communication procedure is integrated in Social Impact Assessment (SIA). The procedures describes the procedures and mechanism to be taken should any stakeholders being the external or internal wish to communicate with the company on any issues concerning their interest. Example of communications procedures viewed are as follows:

i) Grievance reporting flowchart

ii) Stakeholder request procedure (corporate and estate level)

iii) Grievance procedure for land owner issues


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

Compliance

Minor

MA Findings:

A plantation management official at the operation unit is nominated to handle these issues.

Objective evidence:

Social Liaison Officer is appointed at mill. Appointment letter is also available highlighting the role and responsibilities of the officer on matters relating to the social needs and well being of stakeholders as follows:

Welfare and social needs of stakeholders (i.e. workers, suppliers, smallholders Kampong etc directly related to estate).

Periodic visits to linesite and social amenities to ensure that buildings are in good order (through Hospital Assistant).

Periodic visits to neighbouring stakeholders on a reactive manner to ensure that social issues are being taken care of (to have consultation to ensure that communication chain is available and maintained).

Identification of social issues affecting stakeholders and neighbouring communities and to decide upon mitigation plans to solve social issues after consultation with the manager.

Maintenance and monitoring of grievance issues and facilitate feedback mechanism to ensure that a line of communication is available.

Monitoring of crèche and day-care centre to ensure that children are being well taken care of and adequately educated.

To stakeholder’s requests and ensure that requests are followed up with a response.

Grievance issues (encompassing social, work, repairs, etc.) and ensuring that proper follow up is conducted (this is to be documented).

Safety and health aspect of linesite / estate / workers etc.

Other social issues arising / ad hoc social issues (this is situation dependent).


6.2.3 Maintenance of a list of stakeholders, records of all communication and records of actions taken in response to input from stakeholders.

Compliance

Minor

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MA Findings:

List of stakeholders, records of all communication and records of action taken in response to input from stakeholders are available.

Objective evidence:

A comprehensive list of stakeholders is available, listing all government agencies, non- governmental organizations, village representatives and employees. Records of communication with stakeholders and actions taken are maintained and made available.


Criterion

6.3

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

grievances, which is implemented and accepted by all parties.

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

Major

MA Findings:

Availability of documentation of the process by which a dispute was resolved and the outcome.

Objective evidence:

All records of complaints and grievances external and internal are kept within the Grievance/Request Record Book. As of the date of the Main Assessment, there are no complaints received from outsiders and workers.

To address all the grievances and complaints raised by the relevant interested stakeholders, IOI Leepang has established the procedures to resolve the grievance raised in the form of flow chart that is formulated in both English and Malay language and is found to be posted on the company’s notice board. In addition, the company also established the procedures to resolve the grievances involving land issues. Among others, the mechanism highlights the way of resolving the grievances through the following steps:

Direct Negotiation;

Arbitration if Direct Negotiation is not able to solve the grievance;

Native Court if Arbitration is not able to solve the grievance; and

Civil Court as the ultimate platform if Native Court is not able to solve the grievance.

The company also establishes the procedures for dealing with sexual harassment involving its workers by internal or external peoples.


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

Minor

MA Findings:

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

Objective evidence:

Grievance/Request Record Book are viewed and all request and grievances are recorded on a case by case basis stating the details of the complainant, the date as well as the action taken following the complaints raised. The auditing team observed that generally the follow-up action has been taken within 5 working days from the day the complaints received.


6.3.3 The system is open to any affected parties. Compliance

Minor

MA Findings:

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The system is open to any affected parties.

Objective evidence:

The system for dealing with complaints and grievances is open to all affected parties and interviews with workers and stakeholders indicate that no discrimination has taken place. The system is open to any affected parties through:

i. Employees Consultative Committee (ECC).

ii. Gender representation (at least a designated gender representative).

iii. Designated grievance book which is endorsed by the complainants when action has been taken to resolve a grievance.


Criterion

6.4

Any negotiations concerning compensation for loss of legal or customary rights are dealt

with through a documented system that enables indigenous peoples, local communities and

other stakeholders to express their views through their own representative institutions.

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

Compliance

Major

MA Findings:

Procedures for identifying legal and customary rights and people entitled to compensation are established.

Objective evidence:

As stated in Indicator 6.3.1, IOI Leepang has established the procedures to resolve the grievance raised in the form of flow chart that is formulated in both English and Malay language and is found to be posted on the company’s notice board. In addition, the company also established the procedures to resolve the grievances involving land issues. Among others, the mechanism highlights the way of resolving the grievances through the following steps:

Direct Negotiation;

Arbitration if Direct Negotiation is not able to solve the grievance;

Native Court if Arbitration is not able to solve the grievance; and

Civil Court as the ultimate platform if Native Court is not able to solve the grievance.


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

Compliance

Minor

MA Findings:

A procedure for calculating and distributing fair compensation (monetary or otherwise) is established and implemented.

Objective evidence:

IOI Leepang has a procedure in place for calculating and distributing fair compensation. That can be divided into two sections as follows:

a. The procedures for compensation involving workers:-

- In general, this procedures deal with the procedures for retrenchment benefits for workers that is formulated based in the national industrial standard, National Union of Plantation Workers (NUPW) and Leepang agreement.

b. The procedures for compensation involving land owners:-

- This procedures for dealing on any issues relating to land and native customary rights that is formulated step wise from the receipt of the grievance from the land

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owner.


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

Compliance

Minor

MA Findings:

There is no incidence of compensation claims occur.

Objective evidence:

No incidences of compensation of claims occur.


Criterion

6.5

Pay and conditions for employees and for employees of contractors always meet at least

legal or industry minimum standards and are sufficient to provide decent living wages.

6.5.1 Documentation of pay and conditions. Compliance

Major

MA Findings:

Documentation of pay and conditions is available.

Objective evidence:

The documentation of pay and conditions is verified and found to be adequate. The documentation covers the following:

a) salary in the form of pay slips and payment records for contract workers and company workers detailing the basic pay, deductions, overtime, bonuses, allowance etc;

b) documentation of legalisation of migrant workers; and

c) employment agreement is drawn up for foreign workers at all estates and the mill, outlining their pay and conditions.


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

Compliance

Minor

MA Findings:

Labour laws, union agreements or direct contracts of employment detailing payments and conditions of employment are available in the language understood by the workers but not explained carefully to them by a plantation management official in the operating unit.

Objective evidence:

Employment contract for foreign workers available. There are terms of reference for signed contracts between employers and employees stipulating the position, working hours, type of work, location of work, workers’ responsibility, wages, allowances, holidays, rest days, annual leave, fringe benefits, levy deductions (for foreign workers), dismissal, etc.

The appointment letter of staff contain the following elements:

• Job description

• Work location

• Salary

• Increment and bonus

• Duration of employment

• Public holidays (12 days per annum, including four (4) compulsory holidays, i.e. Labour Day, Agong’s Birthday, National Day and State Governor’s Birthday.

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• Annual leave

• Medical benefit, i.e. free medical attention.

• Group insurance coverage

• Employees Provident Fund (EPF)

• Notice of Termination

• Transfers

• Other employment

• Confidentiality

The offer letter (Surat Tawaran Kerja) for migrant workers contains the following:

• Job description

• Contract duration and hours

• Work location

• Employee responsibility

• Wage calculation (80% basic piece rate and 20% statutory benefits, i.e. public holiday, sick leave, sick pay, overtime, annual leave and rest days).

• Overtime

• Leave: public holidays, sick leave, hospitalisation, annual leave and rest days. All of the leave days are included in the salary and will be paid accordingly.

• Facilities: housing, transportation, medical treatment at estate clinic, insurance,

• Deduction of levy to the Malaysian Government

• Legal working age: 18-50 years

• Termination of work permit

Nevertheless, the auditing team note that There is no signature on behalf of the management unit found in the contracts agreement between the management and the workers at Permodalan 3 Estate.


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

Compliance

Minor

MA Findings:

Adequate housing, water supplies, medical, educational and welfare amenities provided to workers.

Objective evidence:

Workers have access to clean water, segregated sanitary and bathing facilities and electricity. All employees are given adequate housing, medical, educational and welfare amenities and waste disposal facilities in accordance with Workers’ Minimum Standard of Housing and Amenities Act. Disposal of domestic solid wastes at the line site is conducted at least twice a week.


Criterion

6.6

The employer respects the right of all personnel to form and join trade unions of their choice

and to bargain collectively. Where the right to freedom of association and collective

bargaining are restricted under law, the employer facilitates parallel means of independent

and free association and bargaining for all such personnel.

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

Compliance

Major

MA Findings:

Workers are not well represented in the meeting with main trade unions.

Objective evidence:

Employees Consultative Committee (ECC) at POM has been established. Chaired by the

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manager of the mill and Social Liasion Officer has taken responsibility as the Secretary. Also there is a representative from workers that is nominated among the workers and submitted to the management. Also there is a representative representing the management of the company. All in all, the representative of the workers can be divided into Store/Press Station/Ramp, Mandore, Electrical/Workshop, Engine & Oil Room and Driver. An appointment letter for each of the representative is available highlighting the role and responsibilities as a member of the committee as follows:

Attending the meeting at the allocated and designated time and venue;

To represent the workers for securing the welfare and their needs;

Assist to identify all problems and issues and to develop the mechanism to establish the communication chain between employee and employer;

Assist in monitoring and maintaining the complaints record; and

Assist in monitoring the line sites, crèche to ensure those areas is in good living condition both safety and health.

There is only one meeting held so far since the establishment of the ECC. The meeting was held on 13 July 2012 attended by 20 members and chaired by the manager. Matters discussed cleanliness of the living quarters and complaints received with regard to the infrastructure at the line site.

Although the ECC has been established, the auditing team note that the workers are not well represented as the appointment of workers representatives is not done in democratic manner among the workers rather than being appointed by the company’s top management.


6.6.2 A published statement in local languages recognizing freedom of association. Compliance

Minor

MA Findings:

A published statement in local languages recognizing freedom of association is available.

Objective evidence:

A valid freedom of association policy is available in all local languages including Tagalog and Indonesian language. The policy is found to be posted on the company’s notice and information wall.


Criterion

6.7

Children are not employed or exploited. Work by children is acceptable on family farms,

under adult supervision, and when not interfering with education programmes. Children are

not exposed to hazardous working conditions.

6.7.1 Documented evidence that minimum age requirement is met. Compliance

Major

MA Findings:

Inadequate documented evidence that minimum age requirement is met.

Objective evidence:

Policy statement for no child labour dated 5th November 2009 endorsed by the Group is available. The policy indicates that IOI Corporation adopted a policy of only workers above 18 years old is employed by the company.

Employment records evidenced that employment age requirement is met. Ground observation during surveillance visit also does not show evidence to suggest employment of underage workers.

Nevertheless, verification at several personal records of each employees sampled during the audit evidenced that the records are not supported with the proof of date of birth to

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ensure the minimum age requirement is met.


Criterion

6.8

Any form of discrimination based on race, caste, national origin, religion, disability, gender,

sexual orientation, union membership, political affiliation, or age, is prohibited.

6.8.1 A publicly available equal opportunities policy. Compliance

Major

MA Findings:

A publicly available equal opportunities policy is available.

Objective evidence:

There is a publicly available equal opportunities policy which states that the company is an equal opportunity employer, whereby the company does not practice discrimination based on race, caste, national, origin, disability, gender, sexual orientation, union membership, political affiliation, or age.


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

Compliance

Minor

MA Findings:

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

Objective evidence:

There is no evidence of discrimination when a cross section of employees was interviewed. A functioning grievance mechanism is in place. The ECC also looks into allegation of discrimination if reported.


Criterion

6.9

A policy to prevent sexual harassment and all other forms of violence against women and to

protect their reproductive rights is developed and applied.

6.9.1 A policy on sexual harassment and violence and records of implementation. Compliance

Major

MA Findings:

A policy on sexual harassment and violence and records of implementation is available.

Objective evidence:

A policy on sexual harassment exists. The policy was also written in the Malay language and displayed on the notice boards. No evidence or practices that contradict this policy were observed. Discussion with female staff shows that the company provide fair and just treatment to women.


6.9.2 A specific grievance mechanism is established. Compliance

Major

MA Findings:

A specific grievance mechanism is established.

Objective evidence:

A mechanism for recording harassment is also available. No evidence or practices that contradict this policy were observed. Discussion with the workers shows that the company provide fair and just treatment to women. Grievance mechanism for sexual harassment is in place. A documented sexual harassment grievance mechanism exists.

A Gender Representative appointed for each estate and mill, whose duties include

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attending to grievances pertaining to gender issues, especially sexual harassment. The Gender Representative is also in-charge of communicating the Policy on the Prevention and Eradication of Sexual Harassment in the Workplace to the workers and staff.


Criterion

6.10

Growers and mills deal fairly and transparently with smallholders and other local

businesses.

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

Major

MA Findings:

Leepang oil mill is not sourcing FFB from outside suppliers including smallholders. All contractual agreements are legal and appear to be fair and transparent. Interviews with suppliers and contractors at the estates reveal that all payments are made in a timely manner.

Objective evidence:

Not applicable as Leepang oil mill is not sourcing FFB from outside suppliers including smallholders. All contractual agreements are legal and appear to be fair and transparent. Interviews with suppliers and contractors at the estates reveal that all payments are made in a timely manner.


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

Minor

MA Findings:


Objective evidence:



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

Compliance

Minor

MA Findings:


Objective evidence:



6.10.4 Agreed payments shall be made in a timely manner. Compliance

Minor

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MA Findings:


Objective evidence:



Criterion

6.11

Growers and millers contribute to local sustainable development wherever appropriate.

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

Compliance

Minor

MA Findings:

Evidence of demonstrable contributions to local development that are based on the results of consultation with local communities.

Objective evidence:

The social impact assessment has included local communities and neighbouring stakeholders. A plan of action has been drawn out to contribute to local activities. The unit as a whole has donated money for local school activities.

The individual estates and the mill have a very basic form of corporate social responsibility (CSR), which usually involves stakeholders, especially the local communities approaching them for donations on various occasions such as deaths, religious celebrations, for the upkeep and maintenance of schools, family day, sports day etc.

Contribution to local community is an active exercise for IOI Leepang and records of contribution eg road upgrading, Transport for water supply during drought, school sport activities, security issues concerning workers etc are available at each estate.


P7: RESPONSIBLE DEVELOPMENT OF NEW PLANTINGS

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

P8: COMMITMENT TO CONTINOUS IMPROVEMENT IN KEY AREAS OF ACTIVITY

Criterion

8.1

Growers and millers regularly monitor and review their activities and develop and implement

action plans that allow demonstrable continuous improvement in key operations.

8.1.1 Minimise use of certain pesticides (C4.6). Compliance

Major

MA Findings:

Evidence of commitment to minimise use of certain pesticides.

Objective evidence:

IOI Leepang is taking effort to make continuous improvement in key areas of activity. There is evidence that effort has been made to minimise use of agrochemicals due to the introduction of biological control.


8.1.2 Environmental impacts (C5.1). Compliance

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Major

MA Findings:

Evidence of commitment to mitigate environmental impacts.

Objective evidence:

A mechanism is in place for environmental management that indicates the specific section of documented environmental impacts for all aspects identified.


8.1.3 Maximizing recycling and minimizing waste or by-products generation. Compliance

Major

MA Findings:

Commitment to Maximizing recycling and minimizing waste or by-products generation.

Objective evidence:

There is documented programme in place that promotes maximising recycling and minimising waste or by-products generation in both estates and mill. The identification of waste and by-products generation is adequate


8.1.4 Pollution prevention plans (C5.6). Compliance

Major

MA Findings:

Pollution prevention plans.

Objective evidence:

The pollution prevention plan is available within the EIA document. The plan contains the identification of the pollutions, the environmental impact of the pollution, the improvement (action) plan, documents that need to be reviewed and management review comments. Implementation wise, the auditing team note that that wastewater analysis done (weekly) and submitted on a monthly basis. These include stack sampling (2 x per year) as well as ambient air monitoring (4 x per year). There is also evidence of legal compliance for FD: BOD < 5,000ppm. It is evidenced that for 2010 and 2011 the BOD recorded was < 150ppm.

However, items that could potentially cause pollution but which have been omitted from the list have not been planned for In time it is expected that the more obvious omissions will be identified, but unless gap identification is undertaken as a systematic review exercise, resultant damage to biological targets in downstream waterways as well as human targets in the estates and local communities could go un-noticed.

The company is in compliance to this requirement: Refer observation 04

8.1.5 Social impacts (C6.1). Compliance

Major

MA Findings:

Commitment towards social impacts.

Objective evidence:

The SIA for the mill as well as the four estates are available outlining the methodology approach of the document. All records of meetings, consultation takes place during the SIA is incorporated in the document. List of the stakeholders consulted are also available. There is evidence of action plan incorporated in the SIA. The action plan describes the plan for mitigate the impacts identified in the SIA as well as plan to monitor the impact.


8.1.6 A mechanism to capture the performance and expenditure in social and Compliance

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environmental aspects. Minor

MA Findings:

A mechanism to capture the performance and expenditure in social and environmental aspects are available.

Objective evidence:

General budget for Corporate Social Responsibility Programme (CSR) and Environmental Control Budget are available.


8. SUPPLY CHAIN

Fresh Fruit Bunches (FFB) produced by the supply base estates are transported to and processed at the Leepang Palm Oil Mill which is located in the Sukau-Kinabatangan region, Lahad Datu, Sabah, Malaysia. The mill with a capacity of 40 metric tonne FFB per hour received and processed raw materials (FFB) from the supplying estates as described in this report.

Although they receive also from their sister estates, eventually, plans have been made to stop receiving from IOI sister estates once Leepang Palm Oil Mill is certified. They will only receive FFB from certified IOI estates.

Their scope will be: Purchase of FFB for the production and sales of CPO and Palm Kernel using the Segregation supply chain module D option

Palm Oil Product Categories Approximate Annual Purchases ( 2011/2012)

Purchased

Fresh Fruit

Bunch

FFB from Supply Base Estates 255,894.64

FFB from other IOI supply Base 157.48

Other non-IOI supplier 0

Total processed 256,052.12

Production

Crude Palm Oil

CPO from Supply Base Estates 54,535.63

CPO from other IOI supply Base 33.56


Total produced 54,569.21

Palm Kernel

PK from Supply Base Estates 13,296.29

PK from other IOI supply Base 8.18


Total produced 13,304.43

Module D – CPO Mills: Segregation

.

Module D

D.1: Documented Procedures

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

MAJOR

Findings In compliance: Yes: No: x

Objective evidence:

No evidence of appointment of a person having overall responsibility for and authority over the implementation of SC requirements. No duties and responsibility has been established related to the implementation of RSPO SC system

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

MAJOR

Findings In compliance: Yes: x No:

Objective evidence:

The facility will only receive form their own supply base.

D.2: Purchasing and goods in

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

MAJOR


Objective evidence:

The facility will only receive form their own supply base.

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

MAJOR


Objective evidence:

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

D.3: Record keeping

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

MAJOR


Objective evidence:

The facility maintains accurate, complete, up-to-date and accessible records and reports of its reception of raw material, processing as well as the despatch.

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


Objective evidence:

The SC procedure did not state the list of records and report that need to be kept for 5 years.

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

MAJOR


Objective evidence:

A template was shown to show that the facility maintain accurate, complete, up-to-date and accessible records and reports of its reception of raw material , processing as well

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as the despatch on a three-monthly basis.

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

MAJOR


Objective evidence:

The delivery procedure did not describe list of information required to be stated in the RSPO products delivery documents as required by the standard

D.4: Sales and goods out

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

The name and address of the buyer;

The date on which the invoice was issued;

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

The quantity of the products delivered;

Reference to related transport documentation

MAJOR


Objective evidence:

The delivery procedure did not describe list of information required to be stated in the RSPO products delivery documents as required by the standard.

D.5: Processing

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

MAJOR


Objective evidence:

There is no procedures to ensure that the RSPO certified palm oil will be kept segregated from non certified material including during transport, storage and processing to ensure that contamination is avoided.

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

MAJOR


Objective evidence:

The facility only purchase form their own supply base

D.5.3 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 operator conforms to these requirements for segregation

The crush is covered through a signed and enforceable agreement

MAJOR

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Objective evidence:

No outsourcing done

D.6: Training

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

MAJOR


Objective evidence:

No training was provided to the related staff with regards to SC requirements

D.7: Claims

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

MAJOR

Findings In compliance: Yes: X No:

Objective evidence:

No claims will be done by the facility. Claims will be done by the IOI Marketing Division

9. EVALUATION DECISION

A revision was made after a review by RSPO and as the result, the Main Assessment resulted in the issuance of 09 Major CARs, 09 Minor CARs and 4 Observations for the P&C.

Following the RSPO review, IOI Leepang Production Unit comply with the recommendation by RSPO and submitted their Corrective Actions ( pictorial and documented ).

After reviewing the submitted evidences by Leepang Production Unit , who is committed to close the Major CARs, SGS ( Malaysia ) Sdn Bhd is in the opinion that the evidences are sufficient to close the 09 Major CARs raised after the review.

For the RSPO Supply Chain, the assessment has resulted in the issuance of 5 Major CARs. As per the Supply Chain requirement, the certification unit has submitted their Corrective Actions within the stipulated time frame. After reviewing, SGS is in the opinion, the evidences are sufficient to close the 5 Major Cars raised during the supply chain audit. Please refer to the Appendix A and B for the details of the findings and relevant correction actions has taken.

With no Major CAR pending, the IOI Corporation Berhad’s management of Leepang Production Unit consist of Leepang POM and its supply base estates in Lahad Datu, Sabah, Malaysia, is now recommended for the certification against the RSPO P&C MYNI requirements. The issues highlighted as Minor CARs must be adequately addressed and the adequacy of the actions taken need to be verified during the first surveillance visit to be conducted within 12 months from the date of the approved assessment.

10. ACKNOWLEDGEMENT OF INTERNAL RESPONSIBILITY AND FORMAL SIGN-OFF OF

ASSESSMENT FINDINGS

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It is acknowledged that the assessments cited in this report have been carried out as stipulated and we confirm the acceptance of the assessment report contents including assessment findings.

Sign on behalf of:

IOI Corporation Bhd

Mr. Too Heng Liew

Head of Sustainability (Malaysia/Indonesia)

Dated : 25/4/13

APPENDIX A: CORRECTIVE ACTION REQUEST & OBSERVATION

CAR # MYNI

Indicator CAR Detail

01 2.2.3 Date

Recorded> 03/08/12

Due

Date>

Next Surveillance

Date

Closed>

Non-Conformance:

Inadequate evidence that boundary stones along the perimeter adjacent to state land and other reserves are being located and visibly maintained.

Objective Evidence:

Estate boundaries have been systematically marked in areas adjacent to other forms of land use (sensitive areas). IOI Leepang has a special mapping team with accurate GPS equipment for boundary verification. All visited estates have their boundary marked with boundary markers. However, the auditors note that one area bordering with Sg. Simpang Forest Reserve is not adequately marked with boundary markers.

Close-out evidence:

02 4.2.2 Date

Recorded> 03/08/12

Due

Date>

Next Surveillance

Date

Closed>

Non-Conformance:

Inadequate of periodic tissue and soil sampling to monitor changes in nutrient status.

Objective Evidence:

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CAR # MYNI


Despites that the soil sampling analysis has been conducted throughout all visiting estates, the auditing team note that the similar analysis is not conducted in the Morisem 5 estate.

Close-out evidence:

03 4.2.3 Date

Recorded> 03/08/12

Due

Date>

Next Surveillance

Date

Closed>

Non-Conformance:

Monitoring the area on which EFB, POME and zero-burn replanting is applied, is not implemented.

Objective Evidence:

No evidence of monitoring of application of EFB on the field to maintain soil fertility at, or where possible improve soil fertility to, ensure optimal and sustain yield.

Close-out evidence:

M04 4.6.3 Date

Recorded> 03/08/12

Due

Date> 03/10/12

Date

Closed> 28/8/12

Non-Conformance:

Pesticides used in estates are not disposed of in accordance with the requirements of the standard.

Objective Evidence:

The auditing team observed that triple rinsing method inconsistently implemented in Morisem 5 estate.

Close-out evidence:

Training has been done to ensure consistency of implementation. Triple rinsing is now done for all empty chemical containers in Morisem 5. Containers are triple rinsed and then punctured.

a) Submitted evidence of training done by Asst Manager Darwis Andi Paramata on 28/08/12 for 13 participants on topic : Bagaimana cara bilas bekas racun 3 kali.

b) Attendance sheet submitted c) Sample record of disposal by Newgates Industries Borneo Sdn Bhd of 103

Containers d) Sample of the receipt receive by Morisem 5

Major 04 Closed

M05 4.6.4 Date

Recorded> 03/08/12

Due

Date> 03/10/12

Date

Closed> 28/8/12

Non-Conformance:

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CAR # MYNI


Information regarding the chemicals and its usage, hazards, trade and generic names was not adequately made available in language understood by workers or explained carefully to them by a plantation management official at operating unit level.

Objective Evidence:

The auditing team noted that MSDS for herbicide Starane has the wrong active ingredient as observed in Morisem 5 estate. In addition, MSDS for Rattus and Matikus are not available at the Leepang 5 estate store.

Close-out evidence:

Leepang Production Unit submitted the missing MSDS for Rattus & Matikus as evidence that they are now available at the storage site. The MSDS were obtained from the suppliers, namely, Hextar and Syngenta . The amended MSDS for Starane has also been obtained from the suppliers.

Major 05 Closed

M06 4.7.1 Date

Recorded> 03/08/12

Due

Date>

Next Surveillance

Date

Closed> 28/8/12

Non-Conformance:

Inadequate implementation of the Occupational Safety and Health (OSH) Plan in compliance with the OSH Act 1994 and Factories and Machinery Act 1967 (Act 139).

Objective Evidence:

Compliance to the Occupational Safety & Health Act, 1994 and Factories and Machineries Act 1967 is evident in the following areas:

There is no emergency telephone number available in the kit;

No first aid kit available with mandore at Block 93A in Morisem 5 Estate during interview;

Inspection at the HIRARC in the Leepang POM evidenced that there is inadequate preventive and protective measures (mitigation) for high risk activities to ensure reducing Lost Time Accident (LTA) rate;

CHRA found not to include apron as one of the element to be assessed for works handling with chemicals in particular pesticides; and

Emergency Response Procedure is not updated as there are several information that is deemed obsolete yet still included in the procedure.

Close-out evidence:

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CAR # MYNI


The following were submitted as evidence : a) Emergency phone numbers have been included in all first aid kits. All mandores have been supplied with first aid kits. The said mandore has been issued a reminder for not bringing the first aid kit to the field. 1/8/2012 b) Our accident records show that the most commonly occurring accidents involve sharp objects – machetes, oil palm frond thorns and FFB spikes. For this, we have reviewed the HIRARCs for the relevant operations and added additional mitigation measures. The HIRARC. 1/8/2012 was attached c) As the CHRA was conducted by a licensed consultant, we are obliged to follow its recommendations. However, our internal review has included aprons as one of the PPE required for workers handling pesticides. 20/8/12

d) The ERP for poisoning included procedures for handling paraquat poisoning. As paraquat has been phased out, the obsolete parts have been removed. 13/8/12

Major 06 Closed

M07 4.8.1 Date

Recorded> 03/08/12

Due

Date> 03/10/12

Date

Closed> 28/8/12

Non-Conformance:

Insufficient training conducted covering safety and health as well as chemical handling.

Objective Evidence:

Interview during the field audit with several mandores evidenced that a few mandores are found to be not attending the first aid kit handling training. Interview also conducted with Estate Hospital Assistants and found that the Estate Hospital Assistant are not train on the chemical use and related laws as per required by the RSPO requirements.

Close-out evidence:

The following were submitted as evidence:

1. Trainings have been conducted again to include those whom had not attended them before. Refer to attachment.

Training ( pictorial and attendance ) for first aid kit usage & CPR – Latihan Peti Kecemasan by Rafida Walu – clinic dresser

Records of items in the first aid box

2. All medical staff – EHAs and nurses have also been trained on chemical usage and the related laws.

Attendance records of participants : medical staff training for chemicals. Dated 7/8/12 for 5 medical staff.

Training material by Safety Officer Kumerdeka

Major 07 Closed

M08 5.1.1 Date

Recorded> 03/08/12

Due

Date> 03/10/12

Date

Closed> 28/8/12

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CAR # MYNI


Non-Conformance:

Inadequate documented aspects and impacts risk assessment that is periodically reviewed and updated.

Objective Evidence:

The EIA document does not includes stakeholder consultation as part of their assessment process.

Close-out evidence:

A consultation meeting has been conducted to obtain feedback from stakeholders. The document has also been reviewed to include the feedback from the stakeholders.

Leepang Production Unit submitted the following evidence:

a) The minutes of the meeting ( 9/8/12 0 attended by stakeholders to obtain feedback. The stakeholders include: Group Plantation Controller, Mr KP Chanthran, Mill represtnative, IOI Estate Representatives, supplier representatives, neighbouring Estates like Malbumi, and PERKESO representatives.

b) Survey records done by safety Officer , Kumerdeka

c) Sample of the local stakeholders interview by the surveyor : Abdul Majid Abdul Manang, Amran Wahid and and Halijah Dollah ( 8/8/12 )

Major 08 Closed

M09 5.2.1 Date

Recorded> 03/08/12

Due

Date> 03/10/12

Date

Closed> 28/8/12

Non-Conformance:

Inadequate identification and assessment of HCV habitats and protected areas within land holdings; and attempt assessments of HCV habitats and protected areas surrounding landholdings.

Objective Evidence:

The identification and assessment of HCV habitats and protected areas within and surrounding landholding did not include potential ERTs.

Close-out evidence:

Leepang submitted evidence to show that the HCV assessments has been updated to include animal species, including ERTs found within and around the area.

Major 09 Closed

M10 5.2.2 Date

Recorded> 03/08/12

Due

Date>

Next Surveillance

Date

Closed> 28/8/12

Non-Conformance:

Management plan for HCV habitats (including ERTs) and their conservation inadequately implemented.

Objective Evidence:

Based on the records of stakeholder consultation conducted, the auditor note that local communities in particular orang sungai and experts are not consulted during identification and assessment of HCVs.

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CAR # MYNI


Close-out evidence:

Leepang has submitted evidence that survey and consultation has been conducted with local stakeholders and documents reviewed.

Refer to 5.1.1

Major 010 Closed

11 5.2.3 Date

Recorded> 03/08/12

Due

Date>

Next Surveillance

Date

Closed>

Non-Conformance:

Lack of commitment to discourage any illegal or inappropriate hunting, fishing or collecting activities, and developing responsible measures to resolve human-wildlife conflicts.

Objective Evidence:

No proper signage allocated for all identified HCVs within the HCV assessment document.

Close-out evidence:

12 5.3.2 Date

Recorded> 03/08/12

Due

Date>

Next Surveillance

Date

Closed>

Non-Conformance:

Inadequate implementation of operational plan to avoid or reduce pollution.

Objective Evidence:

Operational plan have been developed but not implemented adequately to avoid or reduce pollutions, for example; operational plan for domestic waste is not properly implemented to reduced, recycled, re-used and disposed off in an environmentally and socially responsible manner. Scheduled waste, recyclable material and chemical containers found in the landfills in all visited estates.

Close-out evidence:

13 5.6.3 Date

Recorded> 03/08/12

Due

Date>

Next Surveillance

Date

Closed>

Non-Conformance:

Lack of monitoring and reducing peat subsidence rate through water table management.

Objective Evidence:

There is no soil map available to locate the peat area in the estate. In addition there is also no water management table to monitor the peat subsidence rate.

Close-out evidence:

14 6.1.2 Date

Recorded> 03/08/12

Due

Date>

Next Surveillance

Date

Closed>

Non-Conformance:

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CAR # MYNI


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

Objective Evidence:

The auditing team note that the demographic background for capturing data within the SIA do not consider other age groups such as children and old people.

Close-out evidence:

15 6.1.3 Date

Recorded> 03/08/12

Due

Date>

Next Surveillance

Date

Closed>

Non-Conformance:

Lack of a timetable with responsibilities for mitigation and monitoring is reviewed and updated as necessary.

Objective Evidence:

The mitigation measures in the form of action plan is not reliable to ensure the implementation of the SIA.

Close-out evidence:

16 6.5.2 Date

Recorded> 03/08/12

Due

Date>

Next Surveillance

Date

Closed>

Non-Conformance:

Labour laws, union agreements or direct contracts of employment detailing payments and conditions of employment are available in the language understood by the workers but not explained carefully to them by a plantation management official in the operating unit.

Objective Evidence:

There is no signature on behalf of the management unit found in the contracts agreement between the management and the workers at Permodalan 3 Estate.

Close-out evidence:

M17 6.6.1 Date

Recorded> 03/08/12

Due

Date> 03/10/12

Date

Closed> 28/8/12

Non-Conformance:

Workers are not well represented in the meeting with main trade unions.

Objective Evidence:

Although the ECC has been established, the auditing team note that the workers are not well represented as the appointment of workers representatives is not done in democratic manner among the workers rather than being appointed by the company’s top management.

Close-out evidence:

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CAR # MYNI


The following was submitted as evidence:

a) The ECC with appointed worker representatives was dissolved and the workers were asked to appoint their representatives themselves. The workers then handed us letters stating their chosen representatives.

b) The workers representative election minutes ( 7/8/12) were submitted as evidence (The management has accepted the workers’ nominations (refer attachment acceptance of worker representatives) and assisted them in forming their worker representative committee (refer attachment elected worker representatives organization chart).

c) The following were nominated in Morisem 5

Jamaluddin Teppang Harvesting mandore

Akmal Kanci Harvesting mandore

Arman Mehullah Harvesting mandore

Andi Imran Harvesting mandore

Abdul Hamid Majid Harvesting mandore

Halijah Dolloh Maintenance Mandore

Nurlela Rasyid Maintenance Mandore

Naisyah Kadir Maintenance Mandore

Monak Sanudin Maintenance Mandore

Samsuddin Huding Security

Jumasri Jamil Security

Takdir Rahman Mechanic

Naim Alian Driver

d) Sample of Nurlela Rasyid appointed by the sprayer workers was also submitted as evidence of election

Major 017 closed

M18 6.7.1 Date

Recorded> 03/08/12

Due

Date> 03/10/12

Date

Closed> 28/8/12

Non-Conformance:

Inadequate documented evidence that minimum age requirement is met.

Objective Evidence:

Nevertheless, verification at several personal records of each employees sampled during the audit evidenced that the records are not supported with the proof of date of birth to ensure the minimum age requirement is met.

Close-out evidence:

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CAR # MYNI


Evidence was submitted to show :

a) Some of the workers sampled during audit were registered with the consulate for legalization under the amnesty programme. As such some of their passports were not available during audit.

b) A list of the workers that were registered for legalization and scan of some sample passport was submitted e.g. Jovelyn Ursal Camadote

Major 018 closed

a) Corrective Actions Request for the Supply Chain

CAR # RSPO SC ( 2011

) CAR Detail

01 D1.1 Date

Recorded> 03/08/12

Due

Date> 03/11/12

Date

Closed> 15/09/12

Non-Conformance:

There was no evidence of 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

Objective Evidence:

No evidence of appointment of a person having overall responsibility for and authority over the implementation of SC requirements. No duties and responsibility has been established related to the implementation of RSPO SC system

Close-out evidence:

Submission of their SOP – Supply Chain –Module D- CPO Mills – Segregation on the 15/09/12 indicate that the Mill manager of LPOM will have the overall responsibility for and authority over the implementation of SC requirements

Major NC 01 Closed

02 D3.2 Date

Recorded> 03/08/12

Due

Date> 03/11/12

Date

Closed> 15/09/12

Non-Conformance:

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

Objective Evidence:

The SC procedure did not state the list of records and report that need to be kept for 5 years.

Close-out evidence:

Submission of their SOP – Supply Chain –Module D- CPO Mills – Segregation on the 15/09/12 indicate that they will retain their records and reports shall be at least five (5) years

Major NC 02 Closed

03 D 3.4 & D 4.1 Date

Recorded> 03/08/12

Due

Date> 03/11/12

Date

Closed> 15/09/12

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) CAR Detail

Non-Conformance:

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

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

a. The name and address of the buyer;

b. The date on which the invoice was issued;

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

d. The quantity of the products delivered;

b) Reference to related transport documentation

Objective Evidence:

The delivery procedure did not describe list of information required to be stated in the RSPO products delivery documents as required by the standard.

Close-out evidence:

Submission of their SOP – Supply Chain –Module D- CPO Mills – Segregation on the 15/09/12 indicate that they have procedures to include the information in their receiving

and delivery documents as required by the standard.

Major NC 03 Closed

04 D 5.1 Date

Recorded> 03/08/12

Due

Date> 03/11/12

Date

Closed>

Non-Conformance:

The facility do not have clear procedures and record keeping that the RSPO certified palm oil is kept segregated from non-certified material including during transport and storage and be able to demonstrate that is has taken all reasonable measures to ensure that contamination is avoided. The objective is for 100 % segregated material to be reached. The systems should guarantee the minimum standard of 95 % segregated physical material; up to 5 % contamination is allowed.

Objective Evidence:

There are no procedures to ensure that the RSPO certified palm oil will be kept segregated from non certified material including during transport, storage and processing to ensure that contamination is avoided.

Close-out evidence:

Submission of their SOP – Supply Chain –Module D- CPO Mills – Segregation on the

15/09/12 indicate that they now have clear procedures to ensure RSPO certified palm oil will be kept segregated from non certified material including during transport, storage and processing to ensure that contamination is avoided.

LPOM will only receive FFB from their own supply base estates .

Major NC 04 Closed

05 D 6.1 Date

Recorded> 03/08/12

Due

Date> 03/11/12

Date

Closed> 15/09/12

Non-Conformance:

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) CAR Detail

The facility shall provide the training for all staff as required to implement the requirements of the Supply Chain Certification Systems.

Objective Evidence:

No training was provided to the related staff with regards to SC requirements

Close-out evidence:

Training material and attendance was submitted to show that the training for staff as required to implement the requirements of the Supply Chain Certification Systems

Major NC 05 Closed

List of Observations

OBS # Indicator Observation Detail

01 2.1.2 Date Recorded> 03 August 2012 Date Closed> dd MM yyyy

Observation

The list of applicable laws, regulations, permits and licenses is not practical to be monitored due to lack of expiry date and lack of person in-charge at the estates and mill level.

Follow-up evidence:


Observation

Observation in Morisem 5 Estate evidenced that the soil erosion on the 227ha of unplanted hilly area is causing siltation on the main drains within the peat areas between Leepang 3 and Morisem 5.

Follow-up Evidence:


Observation

Although Leepang production unit has established and demarcated the bufferzones along the rivers as per required in the standard, the auditing note that several seasonal stream areas within Morisem 5 and Leepang 3 Estates has been marked as riparian buffer zones that may inflict problem relating to the management of such area in the future due to the seasonal flowing nature of the stream. To cater this problem, the training and understanding is required to the plantation staff to ensure identification, demarcation and enhancement is implemented.

Follow-up Evidence:


Observation

There is evidence of excessive EFB mulching applied at palm near to the road side in Permodalan 3 Estate resulting in significant GHG (methane) releases.

Follow-up Evidence:

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OBS # Indicator Observation Detail

05 Date Recorded> 03 August 2012 Date Closed> dd MM yyyy

Observation

Follow-up Evidence:

APPENDIX B: NON-CONFORMITIES PREVIOUSLY IDENTIFIED

NOT APPLICABLE.

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APPENDIX C: TIMEBOUND PLAN

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APPENDIX D: LIST OF STAKEHOLDERS CONTACTED

SGS RSPO

(Principles & Criteria)

Doc. Number: GP 7002A

Doc. Version date: 01 September 2012

Page: 65 of 77

Following RSPO standard procedures, a public announcement and stakeholder consultation was made at least four weeks prior to field assessment.

A wide range of stakeholders was contacted to inform them of the evaluation and seek their views on relevant oil palm plantation management issues. The stakeholders contacted include environmental and social interest groups, local government agencies and authorities, workers’ unions and the local community leaders.

IOI Leepang Production Unit stakeholders

Government Departments

No. Department Address Contact Number Contact Person

1

2

3

4

5

6

Pejabat Kesihatan Kawasan

Kinabatangan District Office

Lahad Datu District Office

Lembaga Pelabuhan-Pelabuhan Sabah

Jabatan Laut Sabah

Jabatan Kastam Diraja Malaysia

Pejabat Kesihatan Kawasan

W.D.T 40, 90200 Kota Kinabatangan

Pejabat Daerah Kinabatangan Wdt No.8

90200 Kota Kinabatangan

Pejabat Daerah, Peti Surat 60165, 91111 Lahad Datu, Sabah

Bangunan Ibu Pejabat Lpps, Jalan Tun Fuad, Tanjung Lipat, Beg Berkunci No 2005, 88617

Kota Kinabalu

Jabatan Laut Sabah, Cawangan Sandakan, Peti Surat 1966, 90722 Sandakan Sabah

Jabatan Kastam Diraja Malaysia, Urus Setia Perkastaman Lot No A-3-7, Tingkat 3, Plaza Tanjung Aru, Jalan Mat Salleh

Jabatan Alam Negeri Sabah, Kementerian Sumber

Tel :089-561975

Fax: 089-561976

Tel: 089-561811 /561812

Fax: 089 – 561009

Tel : 881518, 881177,881239,881236

Fax:884518

Tel: 088-536400

Fax: 088-223036

Tel: 089-213127

Fax: 089-215197

Fax: 088-538435

Josue Kasseh

Penolong Pengawai Kesihatan

Abd Latif Kandok

Kinabatangan District Officer

Zulkifli Bin Nasir

Lahad Datu District Officer

Mohd Jasmin Julpin

Penolong Pengurus Besar

Penolong Pengarah

Pn. Surifah Bungsu

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7 (a)

7 (b)

8

9

11

12

13

Sabah Department of Environment (KK)

Sabah Department of Environment (SDK)

Inland Revenue Board

Sirim Berhad

Jabatan Perangkaan Malaysia

Suruhanjaya Tenaga

Jabatan Pelabuhan Dan Dermaga Sabah

Jabatan Bomba Dan Penyelamat Malaysia Negeri

Asli Dan Alam Sekitar Malaysia, Aras 4, Blok A, Kompleks Pentadbiran Kerajaan Persekutuan Sabah, Jalan Ums- Sulaman 88450

Kota Kinabalu Sabah

Ketua Cawangan Jabatan Alam Sekitar,

Cawangan Sandakan,

Tingkat 2, Wisma Saban, Lot1&2,

Megah Light Industrial Estate,

Mile 7, Labuk Road.

Lembaga Hasil Dalam Negeri, Wisma Hasil 66 ,

Jln Mesra Off Km2, Jln Kuhara, Beg Berkunci No 44, 91009 Tawau

No 1, Persiaran Dato’ Menteri Seksyen 2, Peti Surat 7035 40700 Shah Alam

Bahagian Perangkaan Perkhidmatan ,Tingkat 3,Unit 01-05, Wisma Minlon Batu 12, Lebuhraya Sungai Besi, 43300 Seri Kembangan, Selangor Darul Ehsan

Pejabat Kawasan Sandakan Tingkat 3, Wisma Saban Km 12, Jalan Labuk W.D.T No 25, 90500 Sandakan

Jabatan Pelabuhan Dan Dermaga Sabah, Peti Surat 80164 ,87011 Wp Labuan

Jalan Lintas,Likas Beg Berkunci 30,88990 Kota Kinabalu

Tel: 088-488166

Fax: 088-488177

Tel: 089 674653

Fax: 089 671384

Tel: 089-777177, 777141 & 777142

Tel: 03-55446000

Fax: 03-55108095

Tel: 03-8947 9000

Fax: 03-8945 9730/9735

Tel : 089-666694

Pn. Sakinah bt. Ajih Penolong Pegawai Kawalan

Tamaraselvam (PPKK)

Murti Pratiwi Bte Samiyono,

Bhgn Unit Q, Unit Pengesanan

Khirul Salleh Marzuki, Ketua Seksyen Perundingan Perniagaan Dan Jenama

Abd Latib Bin Talib

Pengarah

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14

15

16

18

19 (a)

19 (b)

20 (a)

Sabah

Environment Protection Department

Sabah Lands & Surveys Department

Immigration Department

Sabah Agriculture Department (KK)

Sabah Agriculture Department (SDK)

Pesticides Board (KK)

Tingkat 1-3,Bangunan Wisma Budaya

Jalan Tunku Abdul Rahman ,Beg Berkunci

No 2078,88999 Kota Kinabalu,Sabah

Lands & Surveys Department

Lands & Surveys Building

Jalan Perwira,

Headquarters, Kota Kinabalu.

Pejabat Imigresen Tawau,Tingkat 1,Rumah Persekutuan, 91000,Tawau Sabah

Aras 1, 5, 6 dan 7, Wisma Pertanian Sabah

Jalan Tasik (Off Jalan Maktab Gaya), Luyang

Beg Berkunci No. 2050, 88632 KOTA KINABALU, Sabah

Jabatan Pertanian Malaysia, Bangunan Pejabat Pos, Tingkat 5, Peti Surat 12436, 88827, Kota Kinabalu

Unit Kawalan Racun Makhluk Jabatan Pertanian Persekutuan Pejabat Pos Besar, Kota Kinabalu, Sabah

Fax: 089-660279

Tel: 089-274081

Fax: 089-223357

Tel:088-422873 ext 108

Fax:088-433782

TEL NO: 088-251290

FAX NO: 088-238120

TEL; 088-527600

FAX NO: 088-413734

tel:089-772265

fax no:089-774944

Tel: 088 - 283283/ 283282

Fax : 088 - 239046

Idris Bin Jamaludin

Pengarah

Ruslan B Hj Ahmat

Pengawai Pelabuhan

Sandakan

Henry Goliong

Ketua Cawangan penguatkuasaan Bangunan

Mrs. Elin Empau

Celestine Fung or Director

Pengarah Imigresyen

Datuk Ismail Salam

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20 (b)

21

22

23

24

25

26 (a)

26 (b)

Pesticides Board (SDK)

Sabah Wildlife Department (Kinabatangan)

IPD Kinabatangan

Jabatan Bomba Kinabatangan

Jabatan Kerja raya (JKR Lahad Datu

Sabah Forestry Department

Deprtment of Occupational Safety & Health (KK)

Deprtment of Occupational Safety & Health (SDK)

WDT 169, 90200 Kota Kinabatangan

Polis Diraja Malaysia,

Ibu pejabat Polis Daerah,

W.D.T No 17, 90200 Kinabatangan sabah

Jabatan Bomba dan penyelamat Malaysia Negeri Sabah

Peti Surat 60112, Jabatan kerja raya 91107 Lahad Datu

Headquarters

Forestry Department

Km 10, Labuk Road

90000 Sandakan, Sabah, Malaysia

Tingkat 1, Sayap Kanan, Wisma PERKESO,

No. 11, Lorong Sempelang,

88100 Kota Kinabalu, Sabah

Tingkat 1, Wisma Saban,

Batu 7, Jalan Labuk, W.D.T 71,

Bangunan Rumah Persekutuan,

90500 Sandakan, Sabah

tel: 088-233961

fax:088-218007

Tel: 088 233961

Tel: 089 669639

tel: 089-561527 / 581

Tel: 089561890

Fax: 089561559

Tel: 089 562630

Fax:

Tel: 089 884040

Fax: 089 884201

Hisham Abdul Kadir

Salmah bt. Labulla

Shaubah bt. Kasim

Husin b. Muin (Wildlife Officer)

ASP Amir bin Atu (Deputy Commanding Officer & Head of Criminal Investigation Division)

Jumadli Hj Abdul Hamid (District Engineer)

tel:089-561527

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27

28

29

30

31

Department of Irrigation & Drainage

Jabatan Tenage Kerja

Metrology Corporation Sdn. Bhd.

Metrology Sandakan

Hospital Lahad Datu

Kinabatangan Hospital

3rd Floor, Bangunan Urusetia,

P. O. Box 1198,

90713 SANDAKAN

Peti Surat 60181

91111 Lahad Datu, Sabah

GF, Lot 2, Block B, Taman Grandview

Jalan Buli Sim Sim,

90000 Sandakan Sabah

Peti Surat 60065, 9110 Lahad Datu Sabah

W.D.T 200 90020 Kinabatangan.

Tel: (089) 660811, 660125, 660824

Fax: (089) 669170

Tel: 088-235 855 / 088-230 855 / 088-253 576

Fax: 088-233 367

Tel: 089-672 059 / 089-672 072

Fax: 089-672 069

Tel: (089) 667 764

Fax: (089) 671 351

Tel : 089-881623

Fax: 089-880623

Tel : (089) 223-236

Fax : (089) 223-236

Tel : 089-895111

Datuk Sam Manan (Director)

Ir. Mohd. Razak Ismail

Mrs. Jinurah Sintian

Latip Bin Othman (Juruteknik)

Eko Bariono Tumiran

Abdul Bakar Bin Abd Mim (Branch Manager)

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Fax : 089-884670

Tel: 089561857

Fax: 089561854

Dr. Tan Hee Ting (Director)

Dr. Aminudin Baki b. Mohammad (Director)

Non Governmental Organizations

No. Department Address Contact Details Contact Person

1

MALAYSIAN NATURE SOCIETY

JKR 641 Jalan Kelantan, Bukit Persekutuan, 50480 Kuala Lumpur

Malaysia

Tel : 03 - 2287 9422

Fax: 03 - 2287 8773

2

WWF Malaysia (Sabah)

Suite 1-6-W11,

6th

Floor, CPS Tower,

Centre Point Complex,

No. 1 Jalan Centre Point,

88800 Kota Kinabalu.

Tel : 088 262420

Fax: 088 242531

Max Donysisus

3

WWF Malaysia

49, Jalan SS23/15, Taman SEA, 47400 Petaling Jaya, Selangor, Malaysia

Tel : 03 7803 3772

Fax: 03 7803 5157

S. Devan

4 Tenaganita Penthouse, Wisma MLS, No.31, Jalan Tuanku Abdul Rahman, 50100 Kuala Lumpur, Malaysia

Tel : 03-26913691

Fax: 03-26913681

5 Wild Asia Upper Penthouse, Wisma RKT, No 2 Jalan Raja Abdullah, Kuala Lumpur, Federal Territory 50300

Tel: +603 6201 2150

Fax: +603 6201 2150

Dr. Reza Azmi

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6 Proforest Suite #303

MBE Desa Sri Hartamas

No. 30G, Jalan 25/70 A

50480 Kuala Lumpur

Malaysia

Tel: 03 62011148

7

MPOA Malaysia Palm Oil Assocation (MPOA) Sabah, 1st Floor, Lot 3, Block 6, Bandar Indah, Mile 4, Jalan Utara Utara 9009 Sandakan, Sabah

Tel : 089-225863

Fax: 089-225864

Hj. Awaluddin Bin Haji Ghani

8 Humana Child Aid Society Sabah Reg.No. 123/96 Sabah, P.O Box 61850, 91157 Lahad Datu, Sabah

Tel: : 089-866857 Torben Verning

SERVICE PROVIDERS

No. Company Name Address Contact Number Contact Person

1. NTM Consult Lot. 3, Beverly Hills Industrial & Commercial Park, Jalan Bundusan, Penampang, 89500 Kota KInabalu, Sabah.

Phone No : 088-718388

Fax No : 088-718399

Mr. Ir Charlies Soon

(Director)

2. Avery Weight-Tronix Avery Malaysia Sdn. Bhd., No. 8A, 46050 Petaling Jaya, Selangor.

P.O Box 1057, Jalan Semangat, 46860 Petaling Jaya, Selangor, Malaysia.

Phone No : 03-77814344

Fax No. : 03-77815623

3. Schnell Automation Sdn. Bhd. MDLD 6012, Lot 2, 1st floor, Global Commercial

Building, 91100 Lahad Datu, Sabah.

Phone No : 089-889351

Fax No. : 089-884203

Mr. Lee Yong Vui

(Technical Support)

4. Retrofit System 44 Kimbell Light Industrial Centre, Mile 2, Jalan Dam, 91100 Lahad Datu, Sabah.

Phone No : 089-889692

Fax No. : 089-889698

Mr. Jimmy Foo

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5. Chem-Yield Co Sdn. Bhd. Lot 14, Kompleks Perindustrian Usahawan Sedco, Lorong Sedco 5, Jln. Balai Bomba, Batu 3.5, Jalan Utara, 90009 Sandakan, Sabah.

Phone No : 089-212388

Fax No. : 089-227389

Mr. Yong Kai Wah

(Service Manager)

Mr. Chong Ken Luen

(Technical Assistant)

6. Dynabond Industrial (M) Sdn. Bhd.

No.7, Jalan TPP6/11, Taman Perindustrian Puchong, Seksyen 6, 47100 Puchong, Selangor Darul Ehsan, Malaysia.

Phone No : 03-80618813

Fax No. : 03-80618897

7. Green Environmental Service 2nd

Floor, Lot 26, Block D, 22-2, Iramanis Centre, Jalan Lintas-Kolombong, Kota Kinabalu, Sabah.

Phone No : 012-8293881

Fax No. : 088-731487

Dr. Mohamad Taufik Yap

8. Etara Kejuruteraan Letrik Etara (Sabah) Sdn. Bhd.

A159, Jalan Agaseh, Mile 1.5 km, Jalan Tengah Nipah, 91123 Lahad Datu, Sabah, East Malaysia.

Phone No : 089-880955

Fax No. : 089-880966

Mr. Tony Teng

(Technical Director)

Mr. Mardian Bin Karim

(Sales Representative)

9. K.F. Highway Entrprise Sdn. Bhd. P.O. Box 3267, 90736 Sandakan, Sabah Phone No : 089-672933

Fax No. : 089-674995

10. Millivest Sdn. Bhd. Block A, Lot 4, Ground Floor, Taman Grandview, PPM 111 Elopora, 90000 Sandakan, Sabah, Malaysia.

Phone No : 089-212977

Fax No. : 089-271704

Mr. Jonathan Chin Chiew Ming

(Sales Engineer

Mr. Chong Jun Leong

(Sales Engineer)

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11. Engecrol Moditech (AP) Sdn. Bhd. MDLD 1246, Lot 6, Taman Mewah, Jalan Dam, 91100 Lahad Datu, Sabah

Phone No : 089-886857

Fax No. : 089-887852

12. Syarikat High Tech Engineering Mile 11 ½ Jalan Labuk, P.O. Box, BQ No. 3870, Mail Bag No.8, 90700 Sandakan, Sabah.

Phone No : 019-8137665

Fax No. : 089-216991

13. STS Instruments MDLD 4971, Lot 10, New Kimbell Ind. Estate, 91100 Lahad Datu.

P.O Box No. 61718, 91125 Lahad Datu, Sabah

Phone No : 089-867276

Fax No. : 089-880584

Mr. Tai Nyuk Fah

(Managing Director)

Mr. Ng Chun Kit

(Engineer)

14. Scott & English (Malaysia) Sdn. Bhd.

TB 2939, B27, Sedco Light Ind. Estate, Mile 3, Jalan Apas, Mail Bag Service No. 14, 91009 Tawau, Sabah, Malaysia.

Phone No : 089-913166

Fax No. : 089-912643

Mr. Anthony Leong Kee Yet

(Sales Representative)

15. Turbo Turbine (Sabah) Sdn. Bhd. MDLD 6916, Lot 8, Phase 3, Ground Floor, Bandar Sri Perdana, 91100 Lahad Datu, Sabah.

Phone No : 089-862390

Fax No. : 089-862390

Mr. Murthy

(Project & Technical Controller)

16. Turbokraft Service (Sabah) Sdn. Bhd.

MDLD 1246, Lot 6, Taman Mewah, Jalan Dam, 91100 Lahad Datu, Sabah

Phone No : 089-886857

Fax No. : 089-887852

Mr. Francis S. Damsir (Field Service Technician)

17. UMW (East Malaysia) Sdn. Bhd. Mile 4 ½ Jalan Batu Sapi, Karamunting Estate, Si Khiong 3, P.O. Box 2107, 90724 Sandakan, Sabah.

Phone No : 089-612605

Fax No. : 089-612432

Soo Kiang Liang

(Assistant Manager)

Heng Kam Fai

(Assistant Service Manager)

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SUPPLIERS

No. Company Name Address Contact Number Contact Person

1. Kejuruteraan Eletrik ETARA (SABAH) Sdn. Bhd.

A159, Jalan Agaseh, Mile 1.5KM, Jalan tengah Nipah, 91123 Lahad Datu, Sabah.

Tel : 089-880955

Fax : 089-880966

Teng Boon Yah

2. Milivest Sdn. Bhd. Lot 26 MDLD 6612 Teck Guan Shoplot, Jalan Segama, P.O Box. 61135, 91115 Lahad Datu.

Tel : 089-881326

Fax : 089-883821

Timmy Kong

3. De Kota (M) Sdn. Bhd. No.18, Jalan TPP 5/5, Taman Perindustrian Puchong, Section 5, 47160 Puchong, Selangor Darul Ehsan, Malaysia.

Tel : 03-80683318

Fax : 03-80614318

Mr Nc Yap

4. Sulai-Sulaian Enterprise Block B, Lot 2, 1st Floor, MDLD 1432 Dam

Light Industry, Jalan Dam P.O Box 61121, Lahad Datu.

Tel : 013-5501067

Saimon Ambi

5. CHRA Industries Hygiene Services Sdn. Bhd.

D2-1B-0, Blok D2, G/F Floor, Taman Penempang Phase 2S, Penampang, 88300 Kota Kinabalu Sabah.

Tel : 012-893881

Fax : 088-731487

Dr. Muhammad Taufik Yap

6. Palmworld Resources Sdn. Bhd. Lot 199. Tingkat Bawah Sedco Industrial Estate Phase II B Batu 3, Jalan Utara Sandakan.

Tel : 089-235167

Fax : 089-235167

Asdiah Muslee

7. Moditech Sdn. Bhd. MDLD 1246, Lot 6, Taman Mewah, Jalan Dam, 91100 Lahad Datu, Sabah.

Tel : 089-886857

Fax : 089-887852

Ezzy Chiang

8. Avery Weigh-Tronix Tingkat 1, Block A, MDLD 0616, Jalan Matahari, Ming Huat Industries Centre 91100 Lahad Datu.

Tel : 089-886361

Fax : 089- 886362

Ai ping

9. VSAL Industries Sdn. Bhd. Blk D, Lot 1, 1st – 2

nd Floor, Light Ind. Dev,

Bandar Kim Fung, Mile 4, North Road, Sandakan Sabah.

Tel : 089-229180

Fax : 089-225867

T.V. Chong

10. Thien engineering Jalan Kubota, Mile 4. 1/2 , P.O. Box 1427, Tel : 089-913073 Thien Chee Vui

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91039 Tawau Sabah. Fax : 089-913073

11. STS Steam Tech Service Sdn. Bhd. MDLD 4971, Lot 10, New Kimbell Ind Estate, 91100 Lahad Datu, Sabah.

Tel : 089-867276

Fax : 089-880584

Albert Lo

12. Sheong Huat Tyres & Batteries Sdn. Bhd.

P.O.Box No. 60185, 91111 Lahad Datu, Sabah.

Tel : 089-881605

Fax : 089-884180

Albert

13. Watermech Engineering Sdn. Bhd. No.11, Jalan TSB 8, Taman Industri Sg. Buloh, 47000 Sg. Buloh, Selangor Darul Ehsan.

Tel : 03-6036157

Fax : 03-61571633

Ms. Liew kah Cheong

14. Acoxgas Trading Sdn. Bhd. MDLD 3392, lot 34, Jalan Kimbell 2, Kimbell Light Industries, Dam Road, 91100 Lahad Datu.

Tel : 089-886628

Fax : 886882

Mr. Yap

15. Syarikat northwest Trading Lot 78, Ground Floor, taman Sibuga, 90000 Sandakan

Tel : 089- 632889

Fax : 089- 632468

David

16. MP Machinery (Malaysia) Sdn. Bhd MDLD 3270 & 3271, Lot 3270 & 3271, Lot 5 & 6, Blk. 1 fajar Centre, Jln. Segama Lahad Datu.

Tel : 089-882882

Fax : 089-888678

Law Yuk Lee

17. C.H Bearings & hardwares 9Sabah) Sdn. Bhd.

MDLD 3272, block 1, Lot No. 7, 91100 fajar Centre, P.O. Box 61772, 91126 Lahad Datu.

Tel : 089-888743

Fax : 089-888744

Tan Kian Ming

18. Mee San Sdn Bhd. Block E, Lot 32, MDLD 3519, Bandar Wilayah Jasa, Lahad Datu, P.O.Box No. 60084, 91110 Lahad Datu, Sabah.

Tel : 089-886500

Fax : 089-886501

19. Kejuruteraan EMI (Sabah) Sdn. Bhd MDLD 1245, Taman Mewah, Jalan Dam, 91100 Lahad Datu, Sabah.

Tel : 089-886912

Fax : 089-889912

Tan kian Seng

20. Growarisan Sdn. Bhd. MDLD 3983, Tingkat 1 bangunan Fajar Centre Lahad Datu.

Tel : 089-889581

Fax : 089 – 887364

Amat

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21. Yu Chuin Bearing (Sabah) Sdn. Bhd. MDLD 3290, Lot 25, Fajar centre, Jalan Segama, P.O.Box No. 60618,91115 Lahad Datu.

Tel : 089-884362

Fax : 089-888362

Azlan

22. Total Proaktive Engineering Sdn. Bhd 1 Jalan Anggerik mokara 31/48, Kota Kemuning, Seksyen 31, 40460 Shah Alam.

Tel : 016-8320149

Fax : 089-863991

Robert

23. Klinik Mansor Sdn. Bhd. Lot 8, block A1, Batu 7, Bandar Labuk Jaya, Tel : 089-225444

Fax : 089-225444

Dr. Ahmad Mansur

24. Ken Loong Tyres Lot 4, MDLD 3438, Taman Kafoh, Batu 1, Jalan Segama Lahad Datu.

Tel : 089-881328

Fax : 089-881328

Francis

25. Ming Huat Industries Sdn. Bhd. Km 12, North Road, 1st Floor, Bangunan

Ming Huat, P.O.Box 1155, 90712 Sandakan, Sabah.

Tel : 089-660998

Fax : 089-660096

26. Engecrol Moditech (Asia Pacific) Sdn. Bhd.

MDLD 1246, Lot 6, Taman Mewah, Jalan Dam, 91100 Lahad Datu.

Tel : 089-886857

Fax : 089-887852

27. Afinity Future Sdn. Bhd P. O. Box 1374, 90715 Sandakan. Tel : 089-272202

Fax : 089-273777

Ms. Connie

28. Hikayat Lalu Sdn. Bhd. Lot 327, Lorong Senyum Matahari B, Country Height, Sg Ramal, 43000 Kajang Selangor.

Tel : 019-3587904

Fax : 03-87372584

Juy

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Neighbouring Estates

Company Name Address Contact Number Contact Person

1. Luangmanis Estate,

Hap Seng Plantations Holdings Sdn. Bhd.,

Locked Bag No. 5

91109 Lahad Datu

Phone No : 089-577307

Mr. Kim Chung Nyuk Leong

2. Malbumi Estate Sdn. Bhd.,

PO Box 3535,

90739 Sandakan,

Sabah.

PO Box 3535,

90739 Sandakan,

Sabah.

Phone No : 089 623077

Fax No. : 089 623099

Mr. Salan