Stage 1 [ ] Stage2 TUNGGAL KIJANG POM and Kijang Estate · 4.1 Formal Sign-off of Assessment...

PT. MUTUAGUNG LESTARI

ASSESSMENT REPORT

Rountable on Sustainable Palm Oil Certification

[ ] Stage 1 [ ] Stage2 [√] Surveillance

Plantation Manager/Owner : PT. BUANA WIRALESTARI MAS - IVOMAS TUNGGAL

Mill and Plantation Name : KIJANG POM and Kijang Estate

Location : Sekijang Village, Tapung Hilir Sub-district, Kampar District , Riau Province, INDONESIA

Certificate Code : MUTU-RSPO/013

Date of certificate issue : January, 17nd 2012

Expiry date of certificate : January, 17nd 2017

Assessment Date

Report Finalization Date

PT Mutuagung Lestari Auditor

Checked By Approved By

ST-2 04-07, 12/July/2011 12/August/2011

Aryo Gustomo Nanang Mualib Ibnu Satria. P

Octo H.P.N Nainggolan

Taufik Margani

Tony Arifiarachman

ASA-01 05 – 09/

November/12 16/January/2012

Octo HPN Nainggolan Ibnu Satria Prabudi;

Naila Karima; Bukti Bagja

Tony Arifiarachman

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

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

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

MUTU Certification • Approved by RSPO Secretariat on June 2008

Submitted to RSPO Secretariat Approved by RSPO Secretariat on Approved by CB on

20 February 2013

19 December 2012

mailto:[email protected]

http://www.mutucertification.com/


ASSESSMENT REPORT

SPO – 4006a.4 i Prepared by Mutuagung Lestari for PT. Buana Wiralestari Mas – Kijang POM

TABLE OF CONTENT Page

Figure

Operation Map of PT. BUANA WIRALESTARI MAS (Kijang Estate) 1

1.0 SCOPE OF CERTIFICATION

1.1 National Interpretation Used 2

1.2 Organization Information 2

1.3 Type of Assessment 2

1.4 Locations of Plantations, Mill and Hectare Statements 2

1.5 Description of Supply Base 3

1.6 Cycles and Planting year 4

1.7 Tonnage Certified Product 4

1.8 Other Certifications 5

1.9 Time Bound Plans for Other Management Units 5

2.0 PROSES PENILAIAN

2.1 Certification Body 6

2.2 Lead Auditor and Auditor Team 6

2.3 Assessment Methodology, Progress, and Site Visit 7

2.4 Stakeholder Consultation and List of Stakeholder Contacted 8

2.5 Next visitation 8

3.0 ASSESSMENT RESULT

3.1 Summary of Assessment Report of the RSPO Certification 9

3.2 Summary of Assessment Report of Supply Chain 41

3.3 Checklist Conformity of Certificate and Logo Use 45

3.4 Summary of Time Bound Plan Verification of the RSPO Certification 46

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

47

3.6 Summary of Arising Issues from Public, Organization and Auditor Response 66

4.0 CERTIFIED ORGANIZATION’S ACKNOWLEDGEMENT OF INTERNAL RESPONSIBILITY

4.1 Formal Sign-off of Assessment Findings 70

ANNEXES

1 List of Stakeholder Contacted in the RSPO Certification Process 71

2 Audit Plan 72

3 Glossary 73


ASSESSMENT REPORT

SPO – 4006a.4 Page 1 Prepared by Mutuagung Lestari for PT. Buana Wiralestari Mas – Kijang POM

Figure 1. Operation Map of PT. Buana Wiralestari Mas (Kijang Estate)


ASSESSMENT REPORT


1.0

SCOPE OF CERTIFICATION

1.1 National Interpretation Used National Interpretation, RSPO Principles and Criteria for Sustainable Palm Oil Production, Republic of Indonesia - RSPO INA-NIWG, May 2008 and Supply Chain Requirement for CPO Mill.

1.2 Organization Information

1.2.1 Company Name IVO MAS TUNGGAL

1.2.2 Contact person Ismu Zulfikar

1.2.3 Business address

Head Office: Plaza BII Tower 2, 30th Floor JL. MH Thamrin No 51 Kav 22 Jakarta 10350 Indonesia Site: Sekijang Village, Tapung Hilir Sub-district, Kampar District.

1.2.4 Telephone (+62-21) 318 1388

1.2.5 Fax (+62-21) 318 1389

1.2.6 E-mail [email protected]

1.2.7 Website www.smart-tbk.com

1.2.8 Type of enterprise Private

1.2.9 Application information completed by duly authorized representative

Ismu Zulfikar (Head of Environmental Departement)

1.2.10 RSPO member registration June, 17th 2008

1.3 Type of Assessment

1.3.1 Certification scope Palm Oil Mill and Estate

1.3.2 Type certificate Single

1.3.3 Names of company covered in this certificate PT. BUANA WIRALESTARI MAS

1.3.4 Number of management unit 1 (one) unit POM (Kijang Mill) which receives FFB Supply from Kijang Estate (KJGE).

1.4 Location of Estate, Mill and Hectare Statements

1.4.1 Location of Estate

Name of Estate Location

GPS Reference

Latitude Longitude

Kijang Estate Sub.district of Tapung Hilir, District of Kampar, Province of Riau

00 49' 59.82” N 1010 02' 58.15” E

1.4.2 Location of Mill

Name of Mill Location

GPS Reference

Latitude Longitude

Kijang Mill Sub.district of Tapung Hilir, District of Kampar, Province of Riau

00 50' 00.65” N 1010 02' 41.65” E

http://www.smart-tbk.com/


ASSESSMENT REPORT


1.4.3 Maps Figure 1

1.4.4 Country Indonesia

1.4.5 Region Southeast Asia

1.4.6 Village/Sub-district/District/Province Sekijang Village, Tapung Hilir Sub-district, Kampar District, Province of Riau

1.4.7.1 Private

1.4.7.2 State 2,289.39 Ha *)

80.00 Ha **)

*) Based on Land Title Certificate No. 01 year 1994

**) ased on Land Title Certificate No. 01 year 1998

1.4.7.3 Community - Ha

1.4.8 Description of Land Use

Total areal 2,310.38 Ha

Mature area 2,149.96 Ha

Immature area - Ha

Mill and housing 38.14 Ha

Infrastucture (nursery, roads, etc) 71.18 Ha

Replanting Program - Ha

Occupation 19.27 Ha

High Conservation Value 31.43 Ha

1.5 Description of Supply Base

1.5.1 Estate (s)

Name of Estate

Total Area (Ha)

Planted Area (Ha)

FFB (tonnes/yeaer)

Yield (tonnes/ha/year)

Supplied to Mill

FFB (tonnes/yeaer)

%

Kijang Estate 2,310.38 2,149.96 57,716.47 26..84 35,312.71 9.9

TOTAL 2,310.38 2,149.96 57,716.47 26..84 35,312.71 9.9

Source: Estate data production period on October 2011 – September 2012

1.5.2 Smallholder Scheme and Another Source

Smallholder Scheme Member(s) Location

Total Area (Ha)

FFB (tonnes/yeaer)

Supplied to Mill

FFB (tonnes/yeaer)

%

Kijang Plasma *) - Sekijang Village - 264,420.75 264,420.75 74.5

Dami Mas Estate - Sekijang VIllage - 16.84 16.84 0.005

Sungai Tapung Plasma *)

- Petapahan Village - 20,323.89 20,323.89 5.73

Other Sources - Around Estate - 34,891.55 34,891.55 9.83

TOTAL - - - 319,653.03 319,653.03 90.1

*) Kijang Kencana Plasma has had approved by RSPO and CB for Scheme Smallholder Certification on Dec, 12th 2012

Source: FFB Received Data Kijang POM Period on October 2011 – September 2012


ASSESSMENT REPORT


1.5.3 Palm Oil Mill Description

Name of

Mill Capacity

(tonnes/hr)

FFB Processed

(tonnes/year)

CPO PK PKO

Out put (tonnes)

Extraction (%)

Out put (tonnes)

Extraction (%)

Out put (tonnes)

Extraction (%)

Kijang Mill 60 354,965.74 70,993.15 20 17,748.29 5 - -

Source: Kijang POM data Period on Oktober 2011 – September 2012

1.5.4 Type of Product FFB/CPO/PK /PKO

1.6 Planting Year and Cycles

1.6.1 Age profile of planted palms

Planting Year Hectarage (Ha)

1991 244,20

1992 1.832,44

1993 22,82

1996 46,86

2001 3,64

TOTAL 2.149,96

1.6.2 Area restocked by replanting after 2005 - Ha

1.6.3 Cycles 25 Year (s)

1.7 Tonnage Certified Product

1.7.1 Annual Actual Claims of Certified Product

FFB Production 56,569.73 Tonnes/year

CPO Production 12,445.34 Tonnes/year

Palm Kernel (PK) Production 2,969.91 Tonnes/year

Palm Kernel Oil (PKO) Production - Tonnes/year

1.7.2 FFB Certified Claim Production

Name of Estate (s) Total Area

(Ha) Planted Area

(Ha) FFB Production

(tonnes/year) Yield

(tonnes/year)

Kijang Estate 2,310.38 2,149.96 45,000.00 18.06

Kijang Kencana Plasma *) 8,147.79 8,147.79 249,225.79 81.94

TOTAL 10,458.17 10,297.75 294,225.79 100

*) Kijang Kencana Plasma has had approved by RSPO and CB for Scheme Smallholder Certification on Dec, 12th 2012Sumber : Projection Production of Estate(s) Data on November 2012 – October 2013


ASSESSMENT REPORT


1.7.3 Certified Production of Palm Oil Product Claim

Name of

Mill Capacity

(tonnes/hr)

FFB Processed

(tonnes/year)

CPO Palm Kernel PKO

Out put (ton)

Extraction (%)

Out put (ton)

Extraction (%)

Out put (ton)

Extraction (%)

Kijang Mill 60 294,225.79 58,845.16 20 14,711.29 5 - -

Sumber : Projection Production of Mill Data on November 2012 – October 2013

1.8 Other Certifications

1.8.1 ISO 9001:2008/ISO 14001: 2004 None

1.8.2 OHSAS 18001:2007 None

1.8.3 HACCP None

1.8.4 Other (s) - Rountable on Sustainable Palm Oil oleh Mutucertification International (MUTU-RSPO/010 expiry date until 12 Januari 2017).

- ISCC (International Sustainablity and Carbon Certification) since 3 Februari 2012 by GUTCert.

- Certificates Gold Flag of SMK3 from PT Sucofindo since May 4, 2010.

1.9 Time Bound Plan for Other Management Units

IVO MAS TUNGGAL has committed to making the time bound plan for the overall of another unit that is under management in applying the standard of the P & C or obtain RSPO certification and audit team has been considering this plan in accordance with the RSPO Certification System for Partial Certification. The development and follow-up of this plan will be verified and reported on an annual routine visit.


ASSESSMENT REPORT


2.0

ASSESSMENT PROCESS

2.1

Certification Body

PT Mutuagung Lestari Jl. Raya Bogor Km 33,5 No. 19, Cimanggis – Depok 16953 Telp. +62-21-8740202, Fax +62-21-87740745/46 Website: www.mutucertification.com

Email : [email protected] Approved by RSPO Secretariat on June 2008

2.2 Lead Auditor and Auditor Team

2.2.1 Auditor Team

ST2

1. Aryo Gustomo (Lead Auditor). 2. Nanang Mualib (Auditor). 3. Ibnu Satria Prabudi (Auditor). 4. Octo Hombar P. N Nainggolan (Auditor).

ASA-01 1. Taufik Margani (Witness Lead Auditor). Bachelor of Science in Forestry, majoring in Forest Management. Specialist in Ecology and Environmental. He has led several audits for Sustainable Forest Management in Indonesia (under LEI- Indonesian Ecolabel Institute and FSC- Forest Stewardship Council) and he is a Lead Auditor for FSC chain of custody and Forest Management. Other experience: He is IRCA Lead auditor IRCA registered for Environment Management System and Quality Management System. Since 1999 he has been working for independent certification body and has conducted Environment Management System audits in Indonesia and Malaysia. Currently he is the General Manager of Management System Certification.

2. Octo H.P.N Nainggolan (Laead Auditor Witnessed). A bachelor of Agriculture, Department of Social Economics of Agriculture (Agribusiness), University of Udayana, Bali. He has a working experience from year 2004 to 2011 as a Field Staff in a private oil palm plantation company in Indonesia. Trainings attended namely: Training of Conservation of Natural and Biological Resources in supporting HCV, Basic Plantation Management Program and he have attended several audit activities related to certification system of sustainable oil palm plantation as an observer and auditor. Followed the Awareness Management System Certification (ISO 9001-2008). Currently, he works in an independent certification agency as an auditor. In the assessment activity, he conducted assessment on Waste Management, Implementation of OHS in the mill, FFB Processing, water management, pollution and Emission management, legality and supply chain requirement for CPO Mill.

3. Ibnu Satria Prabudi (Auditor). Bachelor of Agriculture Majoring in Agro-technology, Agriculture Faculty of Instiper Yogyakarta. Currently he has been working with an independent certification agency as an auditor. Training he has followed are: Lead Auditor RSPO, Auditor ISPO, Lead Auditor ISO 9001;2008, Awarness HACCP certification, Awarness SQMS Mc Donald, In House Training Green House Gass, and he has engaged on the field test of ISPO standard and then has conducted several audit for sustainable palm oil certification as an Auditor. In this activity, he has assessed for best practices aspect and environment.

4. Naila Karima (Auditor). Bachelor of Public Health, Department of Occupational Safety and Health. Faculty of Public Health, University of Indonesia she attended training of understanding the RSPO certification system and Lead Auditor Training of ISPO. Besides certified Integrated Management System (Health and Safety Management System OHSAS 18001:2007 Occupational, Environmental ISO 14001:2004, ISO 9001:2008 Quality). She is currently working on an independent certification body. In this activity, she has assessed of OHS system aspect.

http://www.mutucertification.com/

mailto:[email protected]


ASSESSMENT REPORT


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

Curriculum Vitae (CV) of the auditor team available at Mutuagung Lestari’s office

2.3

Assessment Methodology, Progress, and Site Visit

2.3.1 Assessment Methodology

ASA-01 The assessment was conducted in three methods: (1) Document Review, aiming to observe the sufficiency of types or substances from required documents; (2) Interview, aiming to obtain more detailed information and cross check the information; and (3) Field Visitation, aiming to observe directly the sufficiency of implementation on site. The scope of the certification activity is 1 (one) Mill (Kijang Mill) with 1 Estate for supply base of FFB namely Kijang Estate (KJGE). In assessing the audit team using the formula 0.8 √y to determine the focus of the estate sampling assessment. Based on the formula auditing team determines KJGE for the estate sampling.

2.3.2

Estimate of person days to implement assessment

ST2 Number of auditors : 4 persons Number of days for ST-2 at site : 4 days Number of working days for ST-2 at site : 16 Maiin days

ASA-01 Number of auditors : 4 persons Number of days for ASA-01 at site : 4 days Number of working days for ASA-01 at site : 16 Main days

2.3.3 Detail of Assessment Process

ASA-01 The assessment was conducted by measuring the sufficiency of implementation with the consistency done by the Buana Wiralestari Mas (BWL-Kijang Mill Scope) to the requirements of National Interpretation of the Republic of Indonesia from RSPO Principles and Criteria for Sustainable Palm Oil Production (RSPO INA-NIWG, May 2008) and Supply Chain Requirement for CPO Mill. Some directions for improvement of the results Annual Surveillance-1 delivered by the auditor MAL to the manager and the results are the subject of verification at the next assessment phase (Surveillance-2). The assessment processes please find Appendix 2. Improvement of findings from Main Assessment findings were observed by auditors at this first surveillance assessment. All information obtained was recorded in Check List of PT Mutuagung Lestari (MUTU) and part of Surveillance report.

2.3.4 Sampling Location of Assessment

ASA-01 The sampling locations which selected by Audit Team based on : 1. Number of sites visited, which is determined by the formula 0.8 √ y. 2. The sites selected represent each of operational working area. 3. The consideration of issues arising from the results of public consultations and document review activity that is fundamental

and crucial. The sites visited are completely presented as follows:


ASSESSMENT REPORT


Location 1 – Div I KJGE. The audit team conducted observation related to spraying activities, implementation of OHS at work area, remuneration, facilities and infrastructure provided by the company, the training has been given by the company and implementation of IPM.

Location 2 – Div I KJGE. The audit team conducted observation related to the harvest, K3 implementation in the workplace, wages, premiums (incentives), and facilities and infrastructure provided by the company.

Location 3 – Workshop KJGE. The audit team conducted observation related to the implementation of OHS in the work area, and fire-fighting infrastructure.

Location 4 – Hazardous Waste Storage of KJGE. The audit team conducted observation related to the waste management, OHS implementation and hazardous waste balance.

Location 5 – Public Service (For example: housing, children care place and Clever Home). The audit team conducted observation related to public services for workers.

Location 6 – HGU Pole No. 2 dan 370 KJGE. The audit team conducted observation related to the maintenance company boundaries clearly demarcated and maintained.

Location 7 – Blok A40 KJGE. The audit tema conducted observation related to EFB Application, water management in the peat land area and riparian management.

Location 8 – Kijang Mill. The audit team conducted observation related to the operational of Mill, OHS Implementation, Fire facilities, First Aid, Storage of Hazardous Waste, Workshop and Hazardous Storage.

2.4

Stakeholder Consultation and List of Stakeholder Contacted

2.4.1 Summary of Public Consultation Process

Stakeholder public consultation was done in three 2 methods : (1) Public announcement in the RSPO website (www.rspo.org) minimum 30 days before ASA-01 conducted. (2) Conduct visits and interviews with stakeholders located in Kampar District and community. Public consultation

conducted on Novemberr, 05th 2012 (for stakeholders from relevant agencies) and November, 06th 2012 (for the stakeholders of the community and workers). A number of verbal inputs from stakeholders both positively and negatively received by the audit team as a material consideration in the assessment of surveillance 1.

2.4.2 The contacted list of stakeholders

See annex 2

2.5 Next visitation

The next visit (Surveillance 2) will be determined one (1) year later after ASA-01 conducted.

http://www.rspo.org/


ASSESSMENT REPORT


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

MUTUAGUNG LESTARI has conducted The Annual Surveillance Assessment 1 (ASA-01) to PT. Buana Wiralestari Mas (BWL) with the scope consist one (1) POM and one (1) Estate. MUTUAGUNG LESTARI stated that PT. BWL has fulfillment of RSPO Standard National Interpretation RSPO Principles and Criteria (P&C) for Sustainable Palm Oil Production, Republic of Indonesia - RSPO INA-NIWG, May 2008. MUTUAGUNG LESTARI recommended of PT. BWL for RSPO Certificate was maintained.

Ref Std. VERIFICATION RESULT OF MUTU-Certification

PRINCIPLE #1 COMMITMENT TO TRANSPARENCY

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

The company has obtained the SOPs related to the provision of information contained in the Consultation and Communication SOP (SOP/SPO/SMART/LH-19) on 1 July 2010. The company has consistently kept records of all incoming requests and provision of information. All records of information requests are recorded in the “Communication Book” register book while the records of the provision of information are recorded in the “Information Book” register book. For example: - Information Book which contains the provision of information from Kijang Estate to external parties is available (For

example: Outcoming letters addressed to all Heads of villages around Kijang Estate on 16 March 2012 regarding the Tsu Chi Health Social Act)

- Communication Book which contains information requests from stakeholder is available (for example: Incoming letter from the Head of Kijang Makmur village regarding the road repair on 24 October 2012, responded on 25 October 2012.

There is an SOP of Retention Time and Control documents (SOP/BWL/DOK) on 5 February 2010 which contains: a. The SOP validity for 3 years and, b. The document retention time for 5 years.

Status: Full Compliance

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.

BWL has determined the types of document which can be accessed by the relevant stakeholders (there are 13 types of information). The type of information which can be accessed by public are:

- The number of employees and the list of the employees’ basic salary.

- The list of employee and Taxpayer Registration Number and information which related to the calculation of Tax on Land and Buildings

- Payment of local taxes/levies.

- The EIA and Environmental monitoring plan/Environmental management plan Documents and LA permit.

- Deed of establishment and changes in the company, datas of areas, production and fertilization application.

- Proof of land ownership (Land Use Title, Building Use Title, Etc)

- Report on the identification of HCV (High Conservation Value).

- Report of SIA (Social Impact Assessment).


ASSESSMENT REPORT


- Documentation of social activities (CSR).

- Report of occupational accident.

- Report of Guiding Commitee of Occupational Health and Safety (GCOHS).

- Report on the implementation of Environmental monitoring plan/Environmental management plan.

- Report of Hazardous Waste Log Book/Balance Sheet.


PRINCIPLE #2 COMPLYING WITH APPLICABLE LAWS AND REGULATION.

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

The company has implemented trainings to the spraying workers of restricted pesticide (Paraquat) which was conducted by the Commission of Pesticide of Riau District Plantation Agency (Mr. Suratmo, SP.) on 8 February 2011 which was attended by the officers of Kijang Estate, Nagamas Estate, Ramabakti Estate, Rama-Rama Estate and Nagasakti Estate. The company has also obtained the Occupational Health and Safety (OHS) License for heavy equipment operators in the estate (Kijang Estate): As many as 9 heavy equipment operators at Kijang Estate have obtained the Certificate of Crane Operator, for example Mr. Urusan Purba has obtained the Tractor Operator Certificate No. 10.7362/OPF/KK/XII/2010 on 13 December 2010 which is valid from 13 December 2010 until 13 December 2015 and issued by the General Directorate of Labour Assistant and Inspection, Minister of Labour and Transmigration. Kijang Mill; there’s a recapitulation of the Operator License (SIO) of Kijang Mill operators of 11 people who have received trainings which includes ; a. Boiler Operator : 6 Persons (Level 1); Mr. Wuryono, Ali Musa, Sugiarto, Zulkarnaini, Budi Surbakti

and Agusman Damanik) b. Crane : 2 Persons (Wheel Loader); Elpi Junaidi Purba and Sapri : 2 Persons (Overhead Traveling Crane, level III); Mr. Suwandi and Syamsuddin : 2 Persons (Hoist crane, level III); Mr. Rifin and Juriadi c. Power and Production Machine Ops. : 1 Person (Diesel/Generator); Mr. Rizal Syahputra d. Power and Production Machine Ops. : 1 Person (Steam Turbine); Mr. Ilhamsyah Rambe e. Welder : 1 Person(Level II); Mr. M. Zulkarnain f. Expert of OHS : 1 Person (General AK3); Mr. Muhammad Fathony Amiruddin,ST

: 1 Person (Electricity OHS Technician); Mr Suprayetno For example; Mr M. Zulkarnain (Level II (Two) Welder), Certificate No; S.803/JL/PNK3/IX/2009 on 15 September 2009. The company has prepared the Capital Investment Activity Report (LKPM) to the Headquarters of Capital Investment Coordinating Board for example; a. BWL (including Kijang Mill); Letter No. 29/VI-II/AB.V/BWLM on 20 June 2011 regarding the Domestic Capital Investment

Activity Report for semester II year 2010 which was received by the officials of relevant agency (Capital Invesment Coordinating Board – Headquarters) on 21 June (Moh. Horib).

b. Based on information from the Management. The Capital Investment Activity Report (LKPM) Semester I year 2011 is in the process of drafting by the headquarter management.

The company has obtained the mechanism of implementing the evaluation to the compliance with legislations related to the management of oil palm plantation through the Regulations and Other Requirements SOP (SOP/SPO/SMART/LH-03) issued by ENVD (Environment Department) on 01 July 2010. That the evaluation to the compliance with legislations is implemented every 6 months is explained inside of this SOP. BWL (Kijang Estate and Kijang Mill) has implemented the compliance with legislations by showing the proof of evaluation to the compliance with legislations associated with HCV (last evaluation in July 2012), Manpower (last evaluation in July 2012), Environment (last evaluation in July 2012), Licensing (last evaluation in July 2012), OHS (September 2012).


ASSESSMENT REPORT


The company has determined the type of legislations that must be fufilled by the plantation company. BWL (Kijang Estate) classify the legislations must be complied with as follow:

- Regulation related to HCV (7 related regulations)

- Regulation related to Manpower (33 related regulations)

- Regulation related to Environment (27 related regulations)

- Regulation related to Licensing (11 related regulations)

- Regulation related to OHS (42 related regulations) The company has obtained the mechanism of implementing the evaluation to the compliance with legislations related to the management of oil palm plantation through the Regulations and Other Requirements SOP (SOP/SPO/SMART/LH-03) issued by ENVD (Environment Department) on 01 July 2010. That the evaluation to the compliance with legislations is implemented every 6 months is explained inside this SOP. However there are some regulations that have not been updated due to some changes. For example:

1. Regulation of Agriculture Ministry (Permentan) No. 07 year 2007 Regulation of Agriculture Ministry (Permentan No. 24 year 2011 regarding the Terms and Procedures of pesticide registration.

2. Goverment Regulation (PP) No. 18 year 1999 Goverment Regulation (PP) No. 85 year 1999 regarding the changes of Goverment Regulation (PP) No. 18 year 1999 on Management of Hazardous Waste.

3. Goverment Regulation (PP) No. 27 year1999 Goverment Regulation (PP) No. 27 year 2012 on the Environmental Permit.

4. Regulation of Labour Ministry (Permenaker) Article 3 No. 15 year 2008 on First Aid. (See OFI. No.01)

Minor 2.1.2 Opportunity for Improvement No. 01

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

Documents which show the land ownership is available, for example: a. Decree of the Governor of Riau Province, Decree No. 08 PT. VI/1990 on reserve land of an approximately 22,000

hectares area at Sekijang Village, Siak Hulu Sub district, Kampar District for the ‘Pola PIR Trans’ Oil palm plantation of PT. Buana Wiralestari Mas on 12 June 1990.

b. Decree of the Head of Kampar District Land Office No. 42/KP/VI/1995 regarding the grant of Location permits on 6 June 1995.

c. Forest Area Acquisition Permits from the Minister of Forestry No. 108/Kpts-II/1991 on 20 February 1991 regarding the acquisition of some parts of Tapung Kanan River Forest Group, an area of 23,312 Hectares which is located at Kampar District, Riau Province for the cultivation of plantation of PT. Buana Wiralestari Mas.

d. Plantation Business Permit (IUP); Principle Agreement No. KB.320/222/Mentan/VI/1988 regarding the Principle Agreement of PIR-TRANS pattern of Oil palm Development on 8 June 1998 on area of 10,000 Hectares which includes 10,000 Hectares of Estate area and 5,000 Hectares of infrastructure, housing, yard and crops area.

e. Decree of the Governor of Riau Province No.559/K/1990 on reseve land of an approximately 7,000 Hectares area at Siak Hulu Sub District, Kampar District, Riau Province for the Development of Oil palm Plantation of PT. BWL.

f. Forest Area Acquisition Permits from the Minister of Forestry No. 108/Kpts-II/1991 on 20 February 1991 regarding the acquisition of some parts of Tapung Kanan River Forest Group, an area of 23,312 Hectares which is located at Kampar District, Riau Province for the cultivation of plantation of PT. Buana Wiralestari Mas.

g. Land Use Title Certificate No. 01 (Sekijang Village) on 16 November 1994 which equipped with Letter of Measurement No 15/1994 valid until 31 December 2029 with an area of 2,289,387 Hectares.

h. Land Use Title No. 01 on 19 March 1998 equipped with Picture Map of Special Situation No. 1554/SLN/1998 with an area of 80 Hectares which is valid for 35 years which is until 17 March 2033.

i. Land acquistion Document which completely listed on the company legal document containing the waiver statement, Minutes of Sekijang Village Cultivated Land Acquisition and Receipts of Land Compensation by each compensation


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recipients which were witnessed by the Head of Kampar District Land Office, First Assistant of Kampar District Head Office, Head of Siak Hulu Sub District and Head of Sekijang Village is available. There is recapitulation of the list of land owner/cultivator, plants and building which compensation will be paid by PT. Buana Wiralestari Mas based on the result of the trial (session) of Kampar District Land Acquisition Committee on 17 March 1992 at Bankinang describing the Name of Land owner/Cultivator, Land, Land Layout, Price of Compensation/m2, total of compensation, types of compensation/consolation gifts, types of plant, compensation on building, total of compensation and signatures of parties who receive the compensation.

There is the Plan of Land Use Title Boundaries Pole maintenance program and Realization of BPN boundaries pole maintenance (year 2012), which include the implementation of checklist, boundaries pole repairement, and painting and cleaning of location activities. Based on the monitoring document of pole condition at the boundaries of Kijang Estate, it was known that the number of boundary poles at Kijang Estate working area was 20 poles. Based on the results of field verification through interviews with the officer of Kijang Makmur village and Gerbangsari village and also the board of Berkat Ridho and Panca Marga Village Cooperation Units (VCU) stated that citizens of both villages are immigrants from outside of Tapung District territory who participated in ‘PIR-TRANS Pattern’ transmigration. These ‘Trans’ residents got 2Ha/household of cultivated land area and were inserted in the scheme program. The information from the community leaders of both villages mentioned that until the implementation of ST2, none of land dispute happened between the community and the company. The land acquisition implementation has been completely done to Land Use Title area and Land acquistion Document which is completely listed on the company legal document containing the waiver statement , Minutes of Sekijang Village Cultivated Land Acquisition and Receipts of Land Compensation by each compensation recipients which were witnessed by the Head of Kampar District Land Office, First Assistant of Kampar Regent Office, Head of Siak Hulu Sub District and Head of Sekijang Village is available. Recapitulation of the list of land owner/cultivator, plants and building for which compensation will be paid by PT. Buana Wiralestari Mas based on the result of the trial (session) of Kampar District Land Acquisition Committee on 17 March 1992 at Bankinang describing the Name of Land owner/Cultivator, Land, Land Layout, Price of Compensation/ m2, total of compensation, types of compensation/consolation gifts, types of plant, compensation on building, total of compensation and signatures of parties who receive the compensation is available. In this records, there are 707 smallholders with an area of 2,467.2 Hectares and total of compensation IDR 287,604,300.00 signed by the Land Acquisition Commitee of Kampar District conisting of National Land Agency, Local Goverment of Kampar District, Plantation Agency, Head of Siak Hulu Sub District, Sekijang Village, and acknnestedged by the Head of Kampar District. Proof of compensation is available in the form:

1. Waiver Statement signed by relevant parties and witnessed by the Head of National Land Agency’s Office of Kampar District, Assistant of the Head of Kampar District’s Office, Head of Sub District and Head of Sekijang Village

2. Stamped Receipt of Compensation. 3. List of Land, Plant, and other businesses related to land acquisition signed by land owners, the company and

Kampar District Regional Inventory Commitee, for example Mr. Diba/Liman, citizen of Sekijang Village has received as much as IDR 300,000 compensation fee for 6 Ha, this was realized on 9 November 1992.

The Mechanism of Land Conflict Resolution (SOP/BWL/PKL) on 5 Februari 2010 which in its resolution steps was following several stages and involving some parties is available, for example:

a. D & L Staff must believe that all land ownership and tenure documents are completed, valid and legally right according to the applied rules.

b. That land ownership status should be socialized to the surrounding community so that there is clarity of the rights of the company.

c. There is a land claim form the surrounding community with or without clear evidence of ownership, then the D & L


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should open dialogue/give oral or written explanation with the purpose of claim can be canceled/dropped. d. Whenever the process of point C above does not work, then solution with the help/facilitation of the Regional

Government will be provided. The Regional Government may involve the Leaders, Head of the village, Head of Sub District, Head of District (Regent), Non-Government Orgaization and Local parliament (DPRD). Result of Agreement should be documented as Minutes of Agreement as evidence of collective agreement among parties.

e. If the effort with the help of the Regional Government doesn’t work either then the process needs to be extended up to the court in order to obtain legal certainty.

f. In addition to documenting it with the Minutes of Agreement, the process of finding solutions by involving the Regional Government and Leaders are also able to be documented by audio visual records. (Video).


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

Based on information from the Management of PT. BWL and result of interview with the Head of (Sekijang Village and Sekoto Aman Village who are the native residents and Kijang Makmur Village and Gerbangsari Village who are immigrants (newcomer) form outside of Tapung District area who were involved in PIR-Trans pattern transmigration) stated that there’s no traditional rights within the company’s Land Use Title. The residents of Trans got 2 Ha/Household land and inserted in the scheme program. Based on information from the Leaders of those 4 villages mentioned that until the implementation of ST2, there was no land dispute happened between the communtiy and the company.


PRINCIPLE #3 COMMITMENT TO LONG-TERM ECONOMIC AND FINANCIAL FEASIBILITY

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

The company’s long term plan document has not changed since the implementation of stage-2. The company’s work plan document includes the company’s work plan document of PT. Buana Wiralestari Mas, period year 2010 until 2017. That document has received approval from the top management (CEO of PSM V – Mr. Fransiscus Costan). This document consists of the production forecast, FFB cost, Mill Cost, Palm product cost/kg, mill production recapitulation (OER and KER), and other financial parameters. The legalization of this document was done by the CEO of PSM 5 (Fransiscus Costan). This document consists of the production forecast, FFB cost, Mill Cost, Palm product cost/kg, mill production recapitulation (OER and KER), and other financial parameters. The company already had a replanting plan that will be implemented in 2017. Then that plan was reviewed again so the replanting plan of year 2017 was revised into 2016. Changes of this plan is a form of annual study which is conducted by the company related with replanting activity. This study itself was conducted based on the criterias of age of the plant, estimation of production, price estimation, cost and height of plant (according to one of the replanting criterias of the owned SOP).


PRINCIPLE #4 USE OF APPROPRIATE BEST PRACTICES BY GROWER AND MILLERS

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


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There is no changes to mill and estate operational SOP. Kijang Estate still refers to standard operational procedure (SOP) in the form of Oil palm Plant Cultivation Tehnical Guideline document which was prepared by MCAR (Management Committee Agronomy and Research) and legalized on 5 May 2007. This document contains the estate operational techniques from LC to harvesting including the management of environment, breeding and crop planning. As for the operational techniques of mill, Kijang Mill still refers to the Palm Oil Mill Processing SOP document of PT. Smart, Tbk. In addition to this operational procedure, Kijang Mill has also established procedures that is related to the product traceability (Supply Chain) in the form of Supply Chain SOP (PT BWL-KJGM/SOP/01), legalized on 2 January 2012 (a revision of the existing procedures). All SOPs are available at each unit management and based on field monitoring, those SOPs have been properly implemented. This was evidenced by the results of interviews with workers in the field. BWL has consistently performed the monitoring to mill and estate operational activities at least once a year. Those implemented activities are:

- Agronomy Audit & Advisory (AAA). The scope of these AAA activities are: Areal statement, Human Resources, Rainfall, Production Quality, Standard of Harvesting, Mature Plant Maintenance, Manuring, Heavy Equipments, Trucks, Workshops and Warehouses, Estate Security, Production Cost, Last assessment was conducted on 21-22 February 2012 (Kijang Estate).

- Operations Internal Audit (OIA). The scope of assessment in this OIA activities are: Bank Cash and Memorial administration, inventory, maintenance of plant and plantation area, production of plant, wages and Human Resource Department (HRD). Implemented at least once (1) a year by the Internal Audit Internal Department. Last assessment was conducted on 05-11 May 2012 (Kijang Mill). Last assessment for Estate was on 24 October.

- Mill Audit Advisory (MAA) – Kijang Mill. The scope of assessment in this MAA activities are: Production, Processing Planning, Power and Comsumable Usage, Control Process, Quality Control, Maintenance, Protective Equipments, Grading, Laboratory. Implemented once (1) a year by the Internal Audit Department. Last assessment was on 01-04 May 2012.

- Internal Audit related to the application of principle and RSPO criterias. Last assessment was conducted on 06-10 August 2012. BWL also conducted Management Review towards the application of RSPO principle and criterias. Management Review was conducted on 10 October 2012. Management Review was conducted to see the progress status of audit findings.

The mill and estate operational activities are always recorded and documented properly by BWL. The records of the mill and estate operational activities include:

- Records of the operational activities results at Kijang Mill in the form of Monthly Processing Report which includes: FFB Intake Statement, Production Record, production & extraction statistic summary, production stock, monthly report summary, monthly laboratory report, water treatment & Boiler chemical, ripple mill effiency, Staff and SKU Labour, Etc.

- Records of operational activities results at Kijang Estate in the form of Agronomy Monthly Report which includes: FFB Security Report, Estate Security Report, Security Unit Report (Security Guard), Oil palm sprouds/Seeds Report, Nursery (Seedling) Report, Insertion, Fertilizer Supply and Order, Manuring Application, Empty Bunch Application, Effluent Waste Application, Tyto alba Monitoring, Heavy Equipments Utilization, Non-Plant Capital, Workdays, Manpower, Fertilizer Spreader, Progress of Land Clearing, Progress of Planting.


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

The company has had the records of land analysis activities for each estate which are conducted every 3 years. However based on explanation of one of the SMARTRI (Smart Research Institute) staff, land analysis activities were done every 5 year and adjusted to year of planting. Changes in this land analysis activities duration is done for the better and more effective land fertility monitoring. Land analysis records activities include physical (texture) fertility analysis and chemical fertility analysis such as pH, C-organic, total N, P & K reserve elements, available P elements, Cation Exchange Capacity (CEC), etc.


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Land (soil) sampling is done based on SOP (Work Instruction/procedure of the available SSU (Soil Sampling Unit) which is 1 soil sample (soil sampling unit) representing 60 ha. From this 1 soil sample unit, the sampling was implemented on 3 sample points where at each point there are 15 sample points. There are 18 sample points. The company has also implemented regular leaf analysis activities. Leaf analysis is conducted every 1 year. Leaf sampling Unit is conducted based on sampling methods on land (soil) analysis activities. Records of leaf analysis on each estate is available. There are 59 sampling points. BWL has consistenly conducts activities to maintain and improve soil fertility such as manuring activity, empty bunch application and land application at Kijang Estate. The entire records of those activities are documented properly. For example:

- Plan and realization of effluent waste manuring program of Kijang Estate year 2012. For example: Effluent waste application at Block K-23 covering an area of 29.4 ha.

- Program and Actual of Manuring in Kijang Estate year 2012. For example: Manuring application at Block W-20 as much as 508 kg (recommendation dosage 1kg/tree. Total of trees in 1 block is as many as 508 trees.


4.3 Practices minimise and control erosion and degradation of soils.

The company has owned the land map for Kijang Estate work area which was conducted by Plantation Monitoring and Planning Division in year 2010. That marginal land map is an integral part of Land Suitability Level documents. In that document information on types of land, slope, texture, depth , drainage, land suitability level, limiting factor and its range are provided. For example SPT 5 with range of 1,434.89 Ha, Typic Dystrudepts land type, with level of slope 3-9 % with clay texture on the top area, loamy clay texture on below area, solum depth > 120 cm with proper drainage, land suitability level of S2. Based on that information, Kijang Estate work area has been mapped with scale of 1:40,000. This map has also been equipped with history and land suitability table of PT. Buana Wiralestari Mas for Kijang Estate. Handling strategies on slopes which is done by the company has been adapted to the available SOP regarding the Preparation Prior to Planting (SMA/MCAR/03/05-07) refers to Table 3.1.1 Classification of slope and terracing needs. Based on this SOP, land with slope > 40 % is not recommended for planting. Road maintenance program document is available in the form of manual road maintenance, spreading sandstone, greader and road roller. For example:

- Plan and realization of manual road maintenance in June 2012 was 928 Ha.

- Plan and realization of 12 KM road maintenance with spreading sandstone until June 2012.

- Plan and realization of 30 KM road maintenance with greader until June 2012.

- Plan and realization of 32 KM road maintenance with road roller until June 2012. The company has owned the peatland area management strategy which was listed on MCAR (Management Committee Agronomy and Research) book, in the chapter on environment management (SMA/MCAR/12/05-07). However based on the results of land suitability level at Kijang Estate, there was no peatland area at Kijang Estate. Based on the results of land suitability level activities, sandy and low organic material content areas were found. Based on that results, the company has done efforts of implementing empty bunch application at areas which are classified as sandy and low organic material content land category. (see indicator 4.2.2) Based on field visits at Block J8 and J9 Kijang Estate, the company has implemented the empty bunch application. Empty bunch application is applied with dosage of 60 ton/ha. Based on the explanation of one of SMARTRI staffs, the empty bunch application is based on land fertility level, slope and distance of application block to the mill.



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

In accordance with the ST1 and ST2, it is known that the company has made efforts to protect waterflow, wetland and river riparian through:

- The implementation of the management policies such as Circulars from the Vice President Agronomy of PSM 5 (Letter

No: 002/SE-VPA-5/RSPO/BWL/01/2010) on 5 January 2010 regarding the Management of Area around Watersheds. The

content of this letter is the cultivation tehnical management of plants at watersheds, which is 5 trees at the left and right of

river in order to be guided by the following: 1) The maintenance of plants doesn’t involve chemical material (chemist), but

it is manually conducted; 2) Manuring is not mechanically (aircraft or emdeks) conducted, but it is conducted manually; 3)

the landslide-phrone clift should be planted by plants – erosion preventing plants.

- As follow up of that circulars, the SOP of river riparian management has been established with No: SOP/RJP/KSS which

was legalized on 15 February 2010 by Vice President Agronomy of PSM 5 which contains the river riparian management

guidelines at PT. BWL plantation area.

Checking of erosion preventing plants planting realization along the river riparian in year 2011 and 2012 was done at Surveillance 1. According to the company’s report, the planting location is Sialang Kalo river which can be found at Kijang Estate plantation area and at three river riparians in Nagasakti Estate plantation area.

The current selected plants are vertifier and guatemala plants, because most of river areas are shaded by oil palm trees. Hard crop trees planting is planned to be done at repanting period. Field checking for this activity was done at Sialang Kalo river riparian. From field checking, it can be ensured: planting has been running, the installation of warning signs for watershed protection are available, painting of chemical treatment boundary at oil palm tree has been done, installation of chemical treatment boundary zinc plate, as well as the planting of erosion preventing plants at river side.

For the purpose of monitoring the progress of planting, the company has also made the recapitulation of erosion preventing plants monitoring results at river riparian which is reported every motnh. Recapitulation of planting number (clumps) at six river riparians until November 2012 can be demonstrated.

For plant maintenance needs, the company has also made the report of plant maintenance which is periodically done every 3 months (quarterly). The company is capable to show the report of plan maintenance activities in December 2011, March 2012, June 2012 and September 2012. Information of river riparian location, time of planting, and maintenance action are listed in that report.

Consistent with the results of stage 1 and 2 audit, in surveillance at PT. BWL – Kijang Estate it is known that the company has continuosly continued the monitoring of surface water quality in a number of places in accordance with the relevant regulations namely:

- Monitoring of well water quality for cosumption around the housing complex of mill and estate employees.

Monitoring is conducted regularly every 6 months. Results of water quality monitoring for the recent period (2 July 2012) is available and can be demonstrated, which is the result of measurement by the Health Agency of Pekanbaru city on 7 June 2012. Locations of sample are:

The well around the housing complex of Kijang Estate’s employees (1 sample)

The well around the housing complex of Kijang Mill’s employee (1 sample)

The measured parameters include the Physical characteristic (odor, turbidity, taste, temperature, color, TDS), Organic Chemistry (KMnO4), Inorganic chemistry (iron, hardness, chloride, etc.), and biological (bacteriological).

Result of that measurement shows all measured parameters have been in accordance with the standard threshold based on the Regulation of Health Ministry 416 year 1990.

- Water quality monitoring at Water Treatment at Palm Oil Mill.


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Water management program is conducted by the Mill, namely through the installation of water treatment in order to get fresh water for the processing of FFB. Document that shows the monitoring of the volume of water used and the results of the quality of water that will be used for the processing of FFB is available.

- Monitoring of surface water quality at watershed that flows inside the plantation (inlet and outlet).

Monitoring was implemented in the river that flows in the plantation which is Sialang Kalo river. The updated measurement results which are being demonstrated is for semester 1 year 2012, on 11 January 2012. Measurement was conducted by SMARTRI laboratory. The measured parameters is the water chemical characteristics which includes pH, TSS, TDS, DO, BOD5, COD, NO3, NO2, NH3, Phosfor, Cu, Zn, Mn, Fe, Pb, Cd, B, Cl, SO4, O&G.

Surface water quality table (inlet and outlet) based on results of measurement in January 2012

No Location DO BOD5 COD O & G

in out In out in out in out

1 Sialang Kalo river 5 4 11 12 34 38 49 50

Quality standard (PP 82 / 2001) 4 mg/l 3 mg/l 25 mg/l 1 mg/l

From the results of that measurement, it was known that a number of important river water parameters such as: DO, BOD, COD, have exceeded the quality standard threshold either in inlet position or in its outlet as seen in the table above. This shows that the river water has been polluted since upstream area, even before it goes into the plantation area.

- Monitoring of the monitoring well water quality associated with the effluent waste application in the estate (LA) Associated with the use of Palm Oil Mill Effluent Waste for oil palm, the company implemented the monitoring of water quality at the determined monitoring wells.There are 3 monitoring wells used for the monitoring of ground water quality as related to the availability of LCPKS application at the plantation of Kijang Estate from Kijang Mill. Measurement is routinely implemented every 6 months by SMARTRI laboratory. The measured parameters were: pH, BOD5, NO3, Cu, Zn, Cl, Pb, Cd, DO, NH3, SO4, COD, and temperature. The available updated measurement result is the data for semester 1 year 2012 which was done on 7 June 2012. In general, the resut of measurement showed that the quality of water at monitoring wells was still in accordance with the regulation of standard threshold based on the Regulation of the Health Ministry 416/1990:

Consistent with the results of stage 2 audit, Kijang Mill has performed the monitoring of effluent waste which discharged into Land Application location on a regular basis every month.The full report of monitoring results for the first semester year 2012 is available in the form Environmental monitoring plan/Environmental management plan report, coupled with the results of monitoring/assessment for the month of July, August, September and October. (As material for semester 2 year 2012 report).

The measurement of the quality of waste water which will be discharged into land application was done by SMARTRI laboratory for parameter: pH, TS, O&G, BOD5, COD, VFA, TA, N, P, K, Mg, Ca, Cu, Zn, Pb, Cd, NH32, TSS. Here are the results of BOD measurement and comparison with the valid standard threshold:

Results of the BOD of the last three months effluent waste for Land Application at Kijang mills

No Month BOD(mg/l) Standard Threshold

(Kepmen LH 29/2003)

1 August 2012 997 5,000

2 September 2012 3,590 5,000

3 October 2012 2,405 5,000

In accordance with the results of audit at stage 1, in surveillance 1 it was also known that the monitoring of the use of water for processing activities at mill is implemented every day. Daily data is then recapitulated in a month for analysis and report material. In document checking, records of the monthly use of water at Palm Oil Mill in the form of Water Usage


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Recapitulation and Water Distribution year 2012 documents for Kijang Mill period January – September 2012 can be demonstrated.

Based on that monitoring data, the amount of water usage at mills is still under the established budget, which is:

Tabel of water usage ratio and FFB tonage each month in year 2012 at Kijang Mill.

The use of water (M3/Ton TBS)

Jan Feb Mar Apr May Jun Jul Aug Sept

Actual 0.87 1.04 1.08 0.82 0.93 0.89 0.78 0.8 0.84

Budget 1.11 1.11 1.11 1.11 1.11 1.11 1.11 1.11 1.11

In addition, a number of water usage saving steps have been taken as what in stage 2 audit is still running namely: socialization of water usage saving, recycling the turbine cooler water to reservoir to be reused in the mill process, performing the monthly/weekly/daily water usage monitoring, and recapitalizing the usage of water for processing and domestic purpose separately.


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

In general, there are 4 efforts done by the company to implement the IPM program, such as:

- Pests Detection (suach as neetle caterpillar/once in 2 months).

- Rats census every 3 months.

- Host plant maintenance (Turnera subulata, Antigonon leptopus, Cassia tora, Nephrolepis)

- Nest (Gupon) maintenance (number of breeders, chicks, eggs, liveliness)

- The company has also inserted the PHT account program into the company’s work operational budget. Records of IPM area monitoring in the form of Integrated Pest Management document of Kijang Estate year 2010 is available. For example: The number of Antigonon leptosus planted on 409 points with an area of 2,163.53 ha; The number of Turnera subulata planted on 2,183.36 ha area. The monitoring of the number of Nest (Gupon) as many as 201 nests. The monitoring of the number of rats and neetle caterpillars. The company has performed the integrated pest management training at Naga Sakti Estate (NSAE) building on 8 February 2010. Training was conducted by the SMARTRI of Riau area. Records of pesticide toxicity monitoring at Kijang estate year 2012 is available, among others:

- Rolixone, toxicity level 0.000005 liter/ton FFB

- Roll up, toxicity level 0.0000017 liter/ton FFB

- Erkafuron, toxicity level 0.000000046 liter/ton FFB

Pesticide toxicity monitoring was monitored through the making of pesticide toxicity monitoring chart. Based on it, the level of toxicity of pesticide per each type has decreased. This is due to the reduction of pesticide usage rotation and selective spraying.



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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.

Agrochemicals materials used by the company:

− Rolixone 276 SL, Paraquat Dichloride 276 g/lt; Registration No. RI. 2467/5-2006/T; permit expiration date 27 June 2011.

− Erkafuron, Methil Metsulfuron 20%; Registration No.: RI.2405/5-2006/T; permit expiration date 27 June 2011.

− Roll up 480 SL, Glyphosate Isopropylamine 480 g/lt active ingredient (equivalent to glyphosate 365 g/l); Registration No RI. 2133/4-2009/T; permit expiration date 30 April 2014.

Based on Forestry and Agricultural Pesticide Book issued by the Directorate General of Pesticide and Fertilizer Directorate General of Agricultural Infrastructures and Facilities of Agriculture Ministry of Indonesian Republic year 2011, it was known that all types of pesticide used by PT. BWL have been registered. BWL has consistently performs the monitoring of pesticide usage based on recommended dosage and rotation. For example:

− Roll up; dosage 0.228 liter/ha; rotation 2 (twice) a year; applied area 2,183.36 ha.

− Rolixone; dosage 0.127 liter/ha; rotation 1 (once) a year; applied area 2,183.36 ha.

− Erkafuron; dosage 0.018 liter/ha; rotation 3 times a year; applied area 2,183.36 ha. The company has performed the documentation of agrochemical usage in year 2012 at Kijang Estate that gives information about targeted species and dosage used. For example:

- Roll up; active ingredient: Glyphosate ; dosage: 0.228 liter/ha; Targeted weeds: narrow and broad leaves.

- Rolixone; active ingredient: Paraquat; dosage: 0.127 liter/ha; Targeted weeds: broad leaves and ferns.

- Erkafuron; active ingredient: Metsulfuron Methyl; dosage: 0.018 liter/ha; Targeted weeds: broad leaves and woody. The company has implemented the training of the use of agrochemical materials. This was evidenced by the attendance list of participants and the material presented. To perform the management of pesticide packaging waste, efforts made by the company are: 1. SOP (SOP/BWL/LBH revision 01) concerning the waste management especially waste of used pesticide packaging. 2. BWL has gained the Permit of Hazardous Waste Temporary Warehouse of PT. Buana Wiralestari Mas through the

Decree of the Head of Environment Bodies of Kampar District No. 660/BLH-WAS/14 which is valid for 5 years. (There is also evidence of re-licensed permit of Hazardous Waste Landfill of PT. BWL. There are 2 Landfill location points, such as:

- Kijang Mill with size of 6 m x 3 m x 3.5 m, with the coordinates of 000 49’ 54.9” N and 1010 02’ 38” E.

- Kijang Estate with size of 3.7 m x 7.3 m x 3.5 m, with the coordinates of 000 50’ 00.7” N and 1010 03’ 01” E. 3. The management of used pesticide packaging was conducted by washing prior to storing it at the Nagamas Estate

central warehouse for later being returned to the supplier. For example: Minutes of Used Pesticide Packaging Handover on 29 September 2012, 4 jerrycans of Roll up; 3 jerrycans of used Rolixone; 28 bottles of used Erkafuron; 6 bottles of used Starane. Minutes of meeting was signed by Kijang Estate and Nagamas Estate Managers.

4. BWL returned the used pesticide packaging waste to the supplier (Rolimex). Records of the Minutes of Used Pesticide Packaging Handover on 29 October 2012 which was signed by Nagamas Estate Manager and Rolimex is available. Based on that Minutes, it was known that used packaging waste that was returned to the supplier included 753 bottles of used Erkafuron; 341 bottles of Used Starane; 172 jerrycans of Used Rollixone and Roll up; 9 jerrycans of Used Regent.

5. BWL has also reported the activities of Hazardous Waste management (including used chemicals) to the relevant authorities every 3 months. For example: Report of Quarter III year which delivered to the Environment Bodies of Kampar District on 19 October 2012.


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BWL (Kijang estate) has consistently performed the reduction of the use of paraquat annualy. This was evidenced by the paraquat usage data chart at KJGE. The information that the use of paraquat at KJGE estate has decreased every year can be obtained from this chart. See the Chart of paraquat usage at KJGE in year 2009 – 2012: below:

Kijang Estate has conducted medical check-up twice for spraying workers which were on 10-11 February 2012 that included physical check-up (respiratory, toxicity and irritation) and on 25-27 June 2012 that included special check-up (urine, blood, rontgent). Based on those workers’ medical check-up results, it can be known that the whole spraying workers’ health condition has been checked. For example: Result of Medical check-up on behalf of Mrs. Suci (The spraying worker of division I) is stated healthy.


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

The Occupational Health and Safety Policy of Kijang Mill which was legalized on 2 July 2012 and the Occupational Health and Safety of Kijang Estate which was legalized on 1 May 2012 are available. Those policies are the revision of the previous policies. Revision is conducted based on the result of the review done periodically by the company. The revision is the Regional Controller changes, while the content of the policy experienced no changes. From the result of interviews with the PICs of SPO at Mills and Estates, it was known the dissemination of Occupational Health and Safety Policy at Kijang Mill and Kijang Estate is conducted through medias of notice board and verbal notice done at the time of morning circle (briefing prior to work). In year 2012, the Structure of the Guiding Commitee of Occupational Health and Safety (GCOHS) has been revised, shown by the changes of the personnel of GCOHS management, and the company has requested the new GCOHS structure to the Social and Labour Agency of Kampar District and has been legalized based on:

- Decree of the Head of Social and Labour Agency of Kampar District No. KPTS.700/DSTK-PHI/2012/08 regarding the Guiding Comitte of Occupational Health and Safety of Kijang Mill of PT. BWL which was legalized on 20 July 2012 with Mr. Radi as Chairman and Ms. Hartati as Secretary (OHS Expert certificate No. 10.5170/AK3-U/DJPPK-P2K/VI/2010, valid until 14 June 2013).

- Decree of the Head of Social and Labour Agency of Kampar District No. KPTS.700/DSTK-PHI/2012/20 regarding the Guiding Comitte of Occupational Health and Safety of Kijang Mill of PT. BWL which was legalized on 31 October 2012 with Mr. Ronny Panjaitan as Chairman and Mr. Bayu Mahendra as Secretary (Reference Decree No. Kep.158/M/DJPPK/III/2011, valid until 21 March 2014)

Regular meetings of GCOHS at Kijang Mill and Kijang Estate has been consistently conducted at once (1) in a month, among others:

- Regular meetings of Kijang Mill’s GCOHS on 22 October 2012 with agenda of discussion such as Review of meeting in September, Weighing-Bridge calibration, work environment examination, stage-2 employees’ medical check-up,

1504.34

670 759.2 658.46

0

500

1000

1500

2000

Year 2009 Year 2010 Year 2011 Year 2012

The Use of Paraquat KJGE of 2009-2012


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employees consultation, and occupational accidents.

- Regular meetings of Kijang Mill’s GCOHS on 02 October 2012 with agenda of discussion such as fragile/damaged buildings, fire prevention and handling, emergency response equipments, the completeness of heavy equipment operator’s PPE, Fire Extinguisher inspection in the workplace and housing.

GCOHS Report is submitted to the Social and Labour Agency of Kampar District quarterly, which includes:

- GCOHS quarterly report (July – September 2012) of Kijang Mill based on Minutes of GCOHS Report Handover on 10 October 2012.

- GCOHS quarterly report (July – September 2012) of Kijang Mill based on Minutes of GCOHS Report Handover on 10 October 2012.

Fee Receipt No. D0012100195 for the payment of Labour Social Assurance of PT. BWL Kijang Mill in August 2012 as much as IDR 14,320,842.00 with the number of registered employees as many as 147 employees is available. Fee Receipt No. D0012100194 for the payment of Labour Social Assurance of PT. BWL kijang Estate and Kijang Kencana Plasma in August as much as IDR 28,447,584,- with the number of registered employees as many as (39 monthly SKU and 147 daily SKU) at Kijang Estate and (9 monthly SKU and 22 Daily SKU) at Kijang Kencana Plasma is available. Based on Circulars No. 001/SE-RC-KAMPAR/07/2010, the periodical medical check-up includes the physical check-up and Special Check-Up. Physical check-up is conducted once (1) a year with types of check-up such as Height, Weight, Blood Pressure, and symptoms. Special check-up is conducted at twice (2) a year which is in June and December with types of special check-up such as Audiometry for workers who work at locations with level of noise exceeding the threshold value , and for workers who are exposed to chemicals. The types of check-up are Blood, Urine, Cholinesterase and Thorax. Special check-up is done by the third party namely Thamrin Clynic Laboratory. Medical check-up at Kijang Mill:

- Physical medical check-up was scheduled to be conducted in January-Desember 2012 with the purpose of not interfering the production, is conducted in stages for all employees.

- The blood, urine, cholinesterase and thorax check-ups done for 14 laboratory employees on 27-28 June 2012 resulted in healthy results.

- Audiometry check-up for 34 employees of Engine Room, Boiler, Nut & Kernel, Press and Thressing and Strelizer division resulted in normal results.

Medical check-up at Kijang Estate:

- Physical medical check-ups were done on 10 February 2012 and 11-13 June 2012.

- Special medical check-up for 15 spraying, fertilizer and Warehouse employees was conducted on 26-28 June 2012, from results of check-up, it was known that 8 employees had problems with blood test. Recommendation letter from Dr. Noverma (The company’s doctor ) on 16 July 2012 is available.

- Audiometry test to 6 generator and water pump operators, showed results of check-up of 2 people on behalf of Mr. Swanto and Mr. Maruba suffered from light Conductive Hearing Lose (CHL). Futher audiometric test addressed to Dr. Noverma on 02 July 2012 is available. Further test was done at Syafira Hospital 0n 02 November 2012. Diagnosed CHL and was advised to have further control after medication.

The company needs to create follow-up mechanism of the medical check-up results if there’s problem/abnormal condition, for example to set the follow-up time limit, so it will not be too long (for the workers) to make a written request to clinic doctors and to ensure that further check-up will be conducted soon. (Opportunity for Improvement No. 02). There is a Hazard Identification and Risk Assessment of Kijang Mill Period January-December 2012 which includes: Security, Weightbridge, Fresh Fruit Bunch Grading, Loading Ramp, Transfer Carriage, Sterilizer, Hoisting Crane, Tippler, Thresher, Press, Klarifikasi, Boiler, Kernel, Engine Room, Water Treatment, Effluent, Workshop, Warehouse, Archive/File Warehouse,


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Hazardous waste and Hazardous Chemicals Warehouse, Sola Tank, laboratories, Offices, CPO Dispacth, installation of machinery unit, fire fighting and vehicle traffic.

There is a Hazard Identification and Risk Assessment of Kijang Estate Period January-December 2012 which includes: ditches cleaning, manual maintenance, chemicals’ container, circle and harvesting path maintenance, manuring, eradication of weeds, Pests control, weeds and diseases, maintenance of road, land application, harvesting, warehouse (fertilizer, solar, chemical, sparepart, oil), maintenance of emplasement, workshop, infrastructure, clynics, water pump machine room, housing, offices, offices of estate, location of cap and used sacks washing.

However in the Hazard Identification and Risk Assessment at Kijang Estate such as at Land Application and Solar Tank, shows the impact of environment (spills, soil contamination) and not the impact to people. So PT. BWL can review the hazard identification and risk assessment of the whole working activities either in the Mill or in the Estate. (Opportunity for Action No. 03) Records of training based on the OHS System Management Work Program of Kijang Mill year 2012 such as Fire Extinguisher Training on 22 September 2012, MSDS and Hazardous Material training on 29 September 2012 and 02 October 2012 by PT. Inter Chemicals Perkasa at the Chemicals vendor of PT. BWL is available. Records of training based on the OHS System Management Work Program of Kijang Estate year 2012 such as First Aid Emergency Response Training by the company’s doctor on 14-15 September 2012 and Integrated Pest Management Training on 13 September 2012 is available. There is an Emergency Response Team which was legalized by the Social and Labour Agency of Kampar District: Kijang Mill on 20 July 2012 and Kijang Estate on 31 October 2012. With the structural composition as follow: Chairman, Administrator, Secretary, General Assistant, Firefighting Team, Medical Team, Security Team, Remover Team, Interpreter (Liason) Team and Evacuation Team. Simulation of housing and field fires and earth quake was conducted on 22 September 2012 at Pondok 2 Division 4/5 Nagasakti Estate with RC/PC of Kampar Region, The Head of Kampar Region’s Estate and Mill Units, PIC of SPO and AK3 of Kampar Region Unit, SPO5 Coordinator of PSM 5, Emergency Response Team of Kampar Region Unit. This simulation is a joined simulation of Kampar Region which includes PT. RJP (Rama-Rama Mill and Rama2 Estate) and PT. BWL (Nagasakti Mill, Nagasakti Estate, Nagamas Estate, Rama Bakti Estate, Kijang Mill and Kijang Estate). Mr. Supriadi (Assistant of Process Foreman) certified as Fire Officer by The Labour Agency with certificate no. 0259/Peran/K3-KEB/VI/2011-P which valid until 16 June 2014. The Infrastructures and Facilities of Fire Handling at Kijang Mill are: - 33 Tubes of Fire Extingusher (Types of dry power, foam and CO2). - 1 unit of Hydrant pillar and 11 unit of dan Hydrant box. - 4 units of Bakortiba Drum (Sand, shovel and Burlap sacks). - 3 units of emergency bell. - Hydrant and Fire Extinguisher Distribution Layout. The Infrastuctures and Facilities of Fire Handling at Kijang Estate are: - 26 tubes of Fire Extinguisher (Types of foam and dry power). - Water Tank, nozzle and 1 unit of hose. - 7 units of Bakortiba drum (sand, shovel and burlap sacks). - 4 units of hooks - Fire handling infrastructures and facilities distribution layout.

There are 9 units of First Aid Box distributed at the Warehouse of Hazardous Waste, Water Treatment, Clarification station, processing offices, Workshops, laboratory, security, warehouse and KJGM offices. There are 8 units of First Aid Emergency Boxes at Kijang Estate, First Aid Emergency bag for Foreman are 25 sets. The routine inspection of fire handling infrastructures and facilities and First Aid Emergency box/bag is conducted every month. First Aid Emergency officers have been certified based on The Regulation of the Health Ministry No. 15 year 2008, evidenced by the availability of First Aid Emergency Certificate from Labour and Transmigration Ministry on behalf of Ms. Rina Yurika (SMK3 clerk) No. 516/P3K/VII/11 and on behalf of Ms. Marisi Friska Siregar (Nurse) No. 518/P3K/VII/11 on 08 July


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2011. Internal First Aid Emergency Response training presented by the company’s doctor which was participated by Foreman and assistant was conducted on 14-15 September 2012. The reporting flow of occupational accident, such as: - KTU informs the outside parties when necessary. - Division/Staff involved in the accident makes the occupational accident report to the human resource department within 1

x 24 hours. - Human Resource Department takes care the medical administration and claims the fee to PT. Jamsostek through

representatives office - Assistant, Secretary of the Guiding Commitee of Occupational Health and Safety performs the investigation of accidents

and conducted a proposed corrective and preventive actions so that accidents will not happen again. - Efectiveness and improvement action taken should be monitored. Based on FR and SR Yearly Recapitulation Report, occupational accident monitoring at Kijang Mill and Kijang Estate in January – October 2012 with result of zero accident is available.

Minor 4.7.2 Minor 4.7.3

Opportunity for Improvement No. 02 Opportunity for Improvement No. 03

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

Program and realization taken at PT. BWL include:

- Fire Extinguisher Training implemented on 22 September 2012.

- MSDS training and Hazardous Material handling on 29 September 2012 and 02 October 2012 by PT. Inter Chemicals Perkasa as chemicals supplier.

- First Aid Emergency Response training done by the Company’s Doctor on 14-15 September 2012.

- Integrated Pest Management conducted on 13 September 2012. Training for scheme smallholder (Amarta Jaya Plasma) was conducted simultaneously with Spraying and Integrated Pest Management Training which is located at NSAE Junior High School School Building on 13 September 2012. In the contract/work agreement with contractor requires contractors to be skillful at their fields, for example agreement of work (contract) on behalf of Riyanto (UD. Bina Karya) as tranporter of Fresh Fruit Bunch delivery to Rama-Rama Palm Oil Mill, Nagasakti Palm Oil Mill, Kijang Palm Oil Mill, Libo Palm Oil Mill, Ujung Tanjung Palm Oil Mill and Sam-Sam Palm Oil Mill No. 002/NSAE/01/2012/KBN-Akt/TBS: Article 3 Working Infrastructure, point 3: Vehicles used as tranporter mush have legal document such as Vehicle Ownership Certificate (BPKB), Vehicle Registration Certificate (STNK), and Vehicle Feasibility Certificate (KIR), and drivers should have Driving License.


PRINCIPLE #5 ENVIROMENTAL RESPONSIBILITY AND NATURAL RESOURCES AND BIODIVERSITY.

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.

Consistent with the result of ST2 audit, the company has owned the impact analysis document in the form :

1. The Environment Impact Management (EIA) document prepared in 1993 for the scope of PT. BWL – Kijang Estate and

has been approved by the Minister of Agriculture through Letter No IRC.220/889/B/V/1994 on 19 May 1994, with capacity


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of mill 60 ton FFB /Hour.

2. The Social Impact Analysis (SIA) document prepared in November 2010 by the internal team of PT. BWL (Mr. Tomi Hendratomo, Mr. Yosaphat Ardhilla R., Ms. Nazlya Syahputri) which includes the villages around PT. BWL including around Kijang Estate.

3. The Environment Evaluation Document (DELH) prepared in year 2011 for PT. BWL Kijang Mill in accordance with the DELH Preparation Warrant from the Ministry of Environment, Riau Environment Bodies and Kampar Environment Bodies.

From the results of document inspection at surveillance 1 activities, it is known that the company has prepared a periodical report of the environment monitoring and Management result, which refers to the applicable provisions of laws and regulations in Indonesia such as :

1. The Report of the Monitoring Implementation of the Environment Management Report and the Environment Monitoring Report at semester 1 year 2012 period for Kijang Estate. Document is submitted to the Environment Bodies of Kampar District on 27 August 2012 (According to the receipt stamped by the Environment Bodies.).

2. The report of six-monthly monitoring of Effluent Waste Application Implementation at Kijang Mill at Semester 1 year 2012 period on 27 August 2012 (According to the receipt).

3. The Report of Hazardous Waste Log Book and Balance of PT. Buana Wiralestari Mas, Kijang Mill Unit in the period of Quarter III/2012, submitted on 29 October 2012.

4. The Environment Quarter Report of PT. Buana Wiralestari Mas, Kijang Mill Unit in the period of quarter III/2012, submitted on 29 October 2012.

5. The Report of optimalization and pesticide waste management to the Ministry of Environment through the office of Sumatera Region in October 2012.

Consistent with the result of audit at ST1 and ST2, there is no changes in scope of either operational area or company’s activites (The capacity of Kijang Mill has not changed from the capacity written in The Environment Impact Management which is 60 FFB/Hour).

Status : Full Compliance

5.2 Status of rare, threatened or endangered species and high conservation value habitats, if any, that exist in the plantation or that could be affected by plantation or mill.

Consistent with ST2 audit, the company has owned the HCV document for PT. BWL prepared by the company’s internal team which includes : Norman Faried Mustakim (aproved RSPO HCV Assessor), Kusuma Widya Rochmah (approved RSPO HCV Assessor), assisted by Tomi Herdartomo, Nazlya Syahputri and Bambang Setyaji on February 2011.

Peer review has been conducted by the external consultant which is Dwi Rahman Muhtaman on October 2010. The availability of High Conservation Value (HCV) 1.1, 1.2 and 4.1 with 31.43 ha of the entire HCV areas can be identified from this document. Types of protected Fauna such as white Throated kingfisher (Halcyon smyrnensis) and Asian leopard cat (Felis bengalensis) were also indentified.

The HCV area Monitoring and Management Plan was also being outlined in the document, eventhough it has not been equipped with detailed descriptions of the plan such as clear timeline, target, opportunities, constraint, resource needs, and others. So as for the future, the company is likely to have a chance of improving the performance of the conservation area management through the making of more measured and systematic plans. (Opportunity for Improvement No. 04).

Consistent with results of ST2, the presence of HCV area and protected species in BWL Nagasakti Estate dan Nagamas Estate plantation area such as Asian leopard cat (Felis bengalensis); with protected status according to the Government Regulation No. 7 year 1999 and included in Appendix II CITES and Throated kingfisher (Halcyon smyrnensis); with protected status according to the Government Regulation No. 7 year 1999 are mentioned in the HCV Identification Report.

Steps taken in protecting the endangered species are ;


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1. Installation of warning boards for the preservation of the mentioned species.

The company has installed 12 warning boards at Kijang Estate which contains the warning of the presence of the protected species and river riparian protection, in addition to that, a number of warning board on the prohibition of hunting animals, poisoning fish and land burning has also been installed. To support the management, the company has owned the map that shows the distribution of those warning boards.

2. Socialization to employees and communtities regarding the preservation of the mentioned species.

Continuing the socialization activities in year 2011 as described in ST2, the company has performed the continuation of socialization to employees on 3-5 September 2012, and socialization to communities on 7 August 2012.

Documentation proof of that socialization activities is available.

3. Species Monitoring

The company has performed the HCV monitoring activities including the monitoring activities of the protected species existence, conducted every week at the same track, for example Naga Mas Estate, there are 2 tracks for each species namely track F30 – 27 and D08 – 10 Boundaries of Perbadoran River Riparian Track (Asian leopard cat) and Pijar River Riparian (Throated kingfisher). Results of monitoring are recapitulated in the HCV Monitoring Recapitulation Form to identify the frequency of encounters of each protected species at each monitoring track.

4. Revegetation of buffer area at the time of replanting.

Based on the results of interviews with HCV monitoring officers and field visit, there is no case of hunting happened at the plantation area during the period of 2012. In addition, as a form of evaluation to HCV management performance, the company has also established the yearly report of the implementation of HCV management actvities in the document entitled: The report of HCV monitoring and management for the period of 2011-2012 for PT. BWL Nagamas, Nagasakti and Kijangmas units which includes the result of the monitoring of protected species found in the plantation area. That report was prepared by the Biodiversity and Conservation Department, Sustainability Division based on results of field activities. With this report document, then the non-conformance NC-2011.24 with Minor Category as identified at ST2 was stated as closed. However, as for the future, the company is likely to have an opportunity of improving the performance of the protected species management by making better planning which contains the habitat supporting resources and behaviour of that protected species with respect to the condition of the environment around the plantation (landscape level), so that the management of activities will be more effective and realistic.

At the time of ST2 audit , a number of steps taken by the company to manage the HCV area and protected species (see also criterion 5.2.1 and 5.2.2 above) have been identified. In general, there were no steps of HCV management done at Kijang Estate which is contrary to the law in force in Indonesia, in fact, in general they have been sinergized with legislation especially the Decree of the President No. 32 year 1990 regarding the management of protected areas and Statute No. 5 year 1990 regarding KSDAH and its ecosystem.

To perform socialization to the community and internal company, on 25 July 2011, the company has provided evidence of HCV socialization to the community around the estate on 18 July 2011 in the form of HCV socialization invitation letter to the Head of Sekijang Village and leaders of Sekijang village and its community; Minutes of HCV socialization, attendance list of activities and documentation (in the form of photographs of events) of socialization activities.

As the continuation of HCV socialization of year 2011 as described in ST2, the company has performed further HCV socialization to employees at PT. BWL on 3-5 September 2012, which included the whole employees at cottage 1, 2 and 3, workshop employees, and socialization to the community on 7 August 2012 which was conducted at Flamboyan village attended by 44 participants. The evidence of this socialization activities dicumentation in the form of invitation letter, photographs and attendance list of activities is available. Consistent with the results of ST2, the company has made posters, warning signs, and circulars (posters in small size), and has also conducted socialization to both internal and external parties. In addition to these steps, some steps records were found, such as :

- Installation/Maintenance of 12 warning signs (boards) at Kijang Estate which contain the warning of of the existence of protected species and protection of river riparian, in addition to that, a number of warning signs on the prohibition of animal hunting, fish poisoning and land burning are also installed. To support the management, the company has a map


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that shows the distribution of those warning boards.

- As the continuation of HCV socialization of year 2011 as described in ST2, the company has performed further HCV socialization to employees on 3-5 September 2012, which included the whole employees at cottage 1, 2 and 3, workshop employees, and socialization in the community on 7 August 2012 which was conducted at Flamboyan village attended by 44 participants. The evidence of this socialization activities dicumentation in the form of invitation letter, photographs and attendance list of activities is available

Consistent with the results of ST2 audit, the company has had special officers assigned to monitor the management of protected areas (HCV) and the protection of wildlife. In the Head Office (HO) support for the management of HCV in the field is the responsibility of Sustainability Department (Led by Mr. Haskarlianus Pasang), within the department there is the HSE Division (Led by Mr. Ismu Zulfikar) which inside there is the Biodiversity and Conservation Section (Led by Mr. Norman Faried M). Within the B & C division, there are 7 officers who support the HCV management operation in the field.

For operation in the estate, there is one person who is incharge as HCV PIC at Kijang Estate (Wahyu I.S) which assisted by a foreman (Wagimin). Those field officers (PIC and Foreman) are responsible to the Estate Manager (Rony Panjaitan) and have received an official assigment letter from the Kijang Estate Manager.

Some trainings have been conducted by the company to those officers. Generally, those officers in HO have received the certified HCV official training. On November 2012, one of the officers which is Dede M. Nasis has received training in Yogyakarta (Cooperation between Tropenbosh and Instiper Yogyakarta). A number of internal training for the PICs and Foremans of PT. BWL including for PICs from Kijang Estatethat has been conducted namely: on 23 June 2012 (9 participants), 3 June 2012 (3 participants, 26 May 2011 (5 participants), and 28 October 2010 (9 participants). Training documentation is available in the form of attendance list, training materials and photographs documentation.

Major 5.2.1 Opportunity for Improvement No. 04

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

Consistent with the result of ST1 and ST2, at PT. BWL especially at Kijang Mill, there are a number of documents which are used to identify the waste generated from plantation and CPO production activities. Documents found in the surveillance 1 are:

1. The Environment Impact Analysis (EIA) document prepared in 1993 for the scope of PT. BWL – Kijang Estate and has been approved by the Minister of Agriculture through Letter No IRC.220/889/B/V/1994 on 19 May 1994, with capacity of mill 60 ton FFB/Hour. Within that EIA document, identification of waste is focused on the identification of effluent waste from the processing of palm oil.

2. List of Environment Aspects of Kijang Mill which contains the environment aspect, potential impacts, control measures and control documents related in the FFB production process at Kijang POM.

3. List of Environment Aspect of Kijang Estate which contains the environment aspect, potential impacts, control measures and control documents related in the production process at Kijang Estate.

However, within those two waste identification documents above (EIA and Aspect), there was no Hazardous Waste separation, including they have not been completed with the estimation of generated waste volume so that the company is likely to have a chance to improve performance by listing the estimation of generated waste volume. (Opportunity for Improvement No. 05).

Consistent with ST1 and ST2, in addition, waste management plan document is available in the form of :

− The waste management plan in the Environmental monitoring plan – Environmental management plan prepared in the beginning of plantation activities. The waste management plan focused to effluent waste of palm oil mill has been made


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in the Environmental monitoring plan – Environmental management plan document.

− The Environment Aspect List Document of Kijang Mill which contains the aspects code, arising environment aspect, potential impacts, related fields and related procedures. This document contains more types of identified waste and their management action plans.

− The Environment Aspect List Document of Kijang Estate which contains the aspects code, arising environment aspect, potential impacts, related fields and related procedures. This document contains more types of identified waste and their management action plans.

However, in the environment aspect document either in the mill or in the estate has not been equipped with the estimation of generated waste volume, so that the company is likely to have the opportunity to improve its performance by listing the estimation of generated waste volume. In addition, the categorization of waste based on its hazardous and toxic characteristics has not been made in this document.

As its implementation form, there are activities of Palm Oil Mill Waste Management of PT. BWL, namely :

− The mill solid waste management through the utilization of excessive fiber and shell as fossil fuel economization, the implemented policy is by operating the Boilers and Turbines using fiber and shell fuel. Solid waste in the form of empty bunch is applied to estate areas as fertilizer.

− The mill effluent waste management is through the utilization of effluent waste for application with land application system to estate areas, and routinely perform the waste samples analysis.

− The management of Hazardous material is by temporarily accomodating and storing it at specific locations and making the hazardous waste temporary storage location, recording it and delivering it to the licensed Hazardous waste collector.

In the surveillance 1 activities, it was known that the company has owned the Hazardous waste management document in the form of :

1. The Environment Aspect List Document of Kijang Estate which contains the aspects code, arising environment aspect, potential impacts, related fields and related procedures. This document contains the types of identified waste including hazardous waste and their management action plans.

2. The Environment Aspect List Document of Kijang Mill which contains the aspects code, arising environment aspect, potential impacts, related fields and related procedures. This document contains more types of identified waste including hazardous waste and their management action plans.

In general, the instruction of Hazardous waste management action is available in the form of legalized SOPs which are : SOP/SPO/SMART/LH-09 on waste management, SOP/SPO/SMART/LH-11 on Environment Aspect Identification and SOP/SPO/SMART/LH-18 on Hazardous Waste Management.

The Hazardous waste management at Kijang Mill follows the established procedure which is by collecting it to the licensed temporary storage location for 180 days (maximum) before being transported by a licensed waste collector (PT. Binasamsurya Mandalaputra). The Hazardous Waste Storage Permits from the goverment agency can be shown which are Letter No. 660/BLH-WAS/ILB3.PWP/04 on 24 September 2012 for Kijang Mill and Letter No. 660/BLH-WAS/ILB.3.PWP/07 on 24 September 2012 for Kijang Estate. In addition, the company has also conducted optimalization process to eliminate Hazardous material characteristic so that The Non-Conformance found in the ST2 is stated as closed.

As for medical waste, the company has also been working with the third party which in this case is Bangkinang General Hospital, Kampar who acts as the waste collector.

Especially for pesticide packaging waste, the company showed a special procedure namely optimalization process which is through pesticide packaging container washing in a particular place and a particular method. With this process, the company claims that the pesticide packaging waste is no longer contains hazardous waste. In the future, the company is advised to


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ensure the elimination of the toxic hazardous characteristic after following this optimalization process through laboratory test. (Opportunity for Improvement No. 05).

Legally, the company has performed consultation with the Ministry of Environment which was conducted on 13 April 2012 regarding the implementation of optimalization process for Hazardous Waste packaging. The party of the Ministry of Environtment was represented by Amsor (Staff of Deputy IV of the Ministry of Environment). Points in this consultation are :

1. With the optimalization process, the packaging of pesticide no longer contains the hazardous material. Furthermore, the company is required to return the packaging to manufacturers in a clean condition for refill purpose.

2. The company is required to :

- Delivering the location, coordinate, and area of pesticide usage optimalization location.

- Delivering the optimalization process so that the packaging no longer contains the hazardous waste.

- Acceptance of packaging for refill process.

3. In the effort of monitoring, then PT. SMART and PT. Rollinmex are required to report those activites to the Ministry of Environment at least every 6 months.

From document checking, it was known that :

1. The company has submitted the Report of the optimalization process of Hazardous waste of used packaging to the Ministry of Environment through the Environmental Office of Sumatera Region in Pekan Baru.

2. In practice, in that optimalization process, further the pesticide packaging is washed properly and controlled, and kept in unreachable and special locations. Furthermore, this pesticide packaging has been taken back by the manufacturers. Thus, The Non-Conformance of CFA-2011.27 with Comment For Action category is stated as closed.

Consistent with ST2 audit, the company has performed the monitoring of generated waste, among others are through :

- Monitoring of the effluent waste application volume and debit for Land Application. Debit monitoring is done every day by performing the recording of flowmeter equipment installed in the pump house at Waste Water/Disposal pond. The daily recording data is then recapitulated into monthly data to be reported every 3 months and 6 months to the relevant agencies.

For the last month data, the average of effluent waste daily debit from Kijang Mill is 666 m3/day while the volume of waste are :

Month Volume

July 18,514 m3

August 15,282 m3

September 19,985 m3

- The monitoring of BOD of effluent waste applied to the land, is conducted every month by SMARTRI laboratory. Data of this BOD monitoring is reported to the relevant agencies every 3 months (See criterion 4.4.3 above for the last 3 months BOD data).

- Monitoring of Hazardous waste collected at the licensedTemporay Storage Location is done every day. From daily report, there are monthly Hazardous waste log book and Hazardous waste balance. Furthermore, the reporting of Hazardous waste monitoring results to the relevant agencies is done every 3 months. Every particular period (< 6 months), Hazardous waste is taken by the licensed third party which is PT. Binassamsurya Mandalaputra, while medical waste is delivered to Bangkinang Regional General Hospital. Based on the Hazardous waste balance sheet data of July – September, the following information is known :


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Types of waste Volume Measures

Used Filter 0 kg has been delivered to the third party as much as 30 kg

Used Rag Cloth 2.25 kg has been delivered to the third party as much as 72 kg

Used Lamp 4.5 kg has been delivered to the third party as much as 3 kg

Used batteries 4 unit has been delivered to the third party as much as 7 unit

Used Lubricating Oil 0 kg has been delivered to the third party as much as 980 kg

For packaging of pesticide, the company has conducted special consultation with the Ministry of Environment on 13 April 2012 regarding the optimalization process to eliminate the hazardous characteristics inside the packaging waste, so that listing the packaging of pesticide in the Hazardous waste Balance Sheet is not necessary. As the result, the company is allowed to conduct optimalization (eliminating the hazardous and toxic content through washing) with condition of reporting its result to the Ministry every 6 months.

- Monitoring of solid waste (fiber and shell) which is collected for boiler fuel (see criterion 5.4.1)

- Monitoring of solid waste (empty bunch) to be applied in the estate.

Major 5.3.1 & 5.3.2

Minor 5.3.1

Opportunity for Improvement No. 05 Opportunity for Improvement No. 06

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

Consistent with the results of ST1 and ST2 audit, the company continues to use fiber and shell as renewable energy for boiler fuel. At the time of Surveillance 1, the company showed the monitoring document of the use of fiber and shell in the processing of FFB in the mill for the last four years (2009 – sept 2012). Documents prepared by the SOP officer and acknowledged by the Nagasakti Mill Manager also analyzes the solar savings resulted from the use of the renewable energy. Data in that monitoring table are as follow :

Year Fiber Volume Shell Volume Solar Savings (liter)

2009 43,085 ton 18,957 ton 2,130,155

2010 339,772 ton 17,499 ton 1,982,910

2011 44,486 ton 19,574 ton 2,186,673

s/d Sept 2012 37,403 ton 16,457 ton 1,487,880

Consistent with ST1 and ST2, the company has performed the Monitoring of fuel (solar) usage to ensure efficiency is still running in the company. Solar budget until September is 38,637 liters and actual usage until September si still under the budget. For estate, the average of solar usage per month is 3.7 thousand liter.

In the examination of the document, there is chart showing decreasing trend in the use of diesel fuel in the estate. Data of the use of diesel fuel in the estate in last three months shows the following data:

Month Volume

July 6,365 liter


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August 3,845 liter

September 1,515 liter

Based on the solar usage monthly data, the company has also conducted the analysis of Fuel ratio per ton FFB every year. Inside that montiroing document, it is known that the use of solar for the last three years has a tendency to decrease. Monthly solar ratio to ton FFB in the estate for year 2012 is 0.13 liter/ton FFB.

Beside the data in the estate, the company also has a document that shows the monitoring of solar usage in the mill. The average of monthly solar usage in the mill is 29,245 thousand liter. Solar fuel consumption data for the last 3 months are as follow:

Month Volume

July 17,757 liter

August 16,169 liter

September 15,931 liter

Consistent with the results in ST1 and ST2, the company has a document that shows the monitoring and management of POME activities. In surveillance 1, the company is able to show the layout document (design) of POME describing that in Kijang Mill, there are 8 ponds of waste with capacity of each pond is 11,430 m3 , equipped with control basin and pumping house.

The monitoring of the quality of waste is routinely conducted (monthly) to know the quality of effluent waste that will be applied to the plantation area (land application). In addition, debit of waste is also measured daily using flow meter. Data of the waste quality can be seen in indicator 4.4.3 above, while daily debit data contained in indicator 5.3.4 above.

As a guide to the management of POME, the company has the POME management SOP which is the explanation of Effluent Final Management (Chapter IX) in the SOP book of Palm Oil Mill Processing of PT. SMART (the 4th revision). SOP describes the definition, work plans, operating procedures, analysis of effluent, effluent examination method, and monitoring of effluent.

Status Full Compliance

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

BWL is still referring to the SOP on zero burning land clearing contained in the Management Committee Agronomy and Research on land clearing and planting (SMA/MCAR/05/05-07) Chapter V associated with Zero burning policy. The company is always commited not to perform burning during land clearing, based on the results of document review and field visits there were no new opening areas. Based on the existing SOP of land opening and planting, the company performs them through several stages, such as : preparation of spatial planning, path blocking, imas (cutting small logs diameter <15 cm), uprooting, mechanical stacking, stacking and chopping. For land fire emergency response procedure, BWL still refers to the land fire emergency procedure which is the SOP of Land Fire Handling in the estate area (SOP/RJP/KBR) which was legalized on 5 February 2010. The Emergency Response Team of Nagasakti Estate was authorized by the Labour and Social Agency of Kampar District on 31 October 2012 with composition of structure as follow : Chairman, Administrator (Daily Chairman), Secretary, General Assistant, Firefighting Team, Security Team, Removal Team, Liason Team, and Evacuation Team.


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Fire fighting facilities and infrastructures at Kijang Estate : - 26 tubes of Fire Extinguisher (foam dan dry powder) - Water tank, nozzle and 1 unit of hose. - 7 units of Bakortiba Drum (sand, shovels, burlap sacks) - 4 units of pole hook. - Distribution layout of facilities and infrastructures of fire handling.


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

Consistent with ST1 and ST2 audit, the company owns the evidence of the identification of sources of emission and pollution in the mill, listed in documents:

- Environmental Aspect of Palm Oil Mill Activities of Kijang Mill, which is a matrix that contains the details of activities in the mill in detailed and potential waste/emission resulted from those activities.

- Palm Oil Mill Waste Management Activities, semester II/2011, Kijang Mill, Types of the source of pollution and emission in the mill are : the mill’s gas waste which derived from boiler chimney and generator machine; noise, vibrate and lighting that comes from working hall in the mill.

Consistent with the results of ST1 and ST2, the company has also made innovations to reduce boiler gas emissions by using Fuel Balancing Control method; which means at boiler station, fiber and shell fuel feed is automatically conducted by taking into account the composition of fuel volume that enters the boiler kitchen, thus avoiding excessive pressure on the boiler.

Based on field visits, boiler station has been equipped with Dust Collector as dust catcher before leaving the boiler chimney. Maintenance of dust collector is conducted every month. The company has also showed the documentation of the monitoring of fuel usage in the mill and in the esate as efforts to reduce emissions. In the future, the company has begun to roll out a suggestion to use methane trapping technology to reduce the emissions of effluent waste of Palm Oil Mill.

Consistent with results in ST1 and ST2, the company has a document that shows the monitoring and management activities of POME. In surveillance 1, the company is able to show layout document (design) of POME describing that at Kijang Mill there are 8 ponds of waste with capacity of 11,430 m3 for each, equipped with control basin and pumping house.

The monitoring of the quality of waste is routinely (monthly) conducted to know the quality of effluent waste which will be applied to the plantation area (land application). Debit of waste is also measured daily using flow meter. Data of effluent quality can be seen in indicator 4.4.3 above, while for data of daily debit is in indicator 5.3.4 above.

As a guide to the management of POME, the company has the POME management SOP which is the explanation of Effluent Final Management (Chapter IX) in the SOP book of Palm Oil Mill Processing of PT. SMART (the 4th revision). SOP describes the definition, work plans, operating procedures, analysis of effluent, effluent examination method, and monitoring of effluent.


PRINCIPLE #6 RESPONSIBLE CONSIDERATIONS OF EMPLOYEES AND INDIVIDUALS AND COMMUNITIES AFFECTED BY GROWERS MILLS.

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

Consistent with the results of ST1 and ST2, from document checking during surveillance 1, it was known that the company already has a document of environment and social impact analysis in the form of :


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1. Survey of Social, Economic, and Cultural conditions and perception of the community at villages around Estate/Mill of PT BWL (Kijang Estate) which was used as the Social Impact Assessment document prepared internally by the company (Sdr. Tomi Hendartomo, Yosaphat Ardhilla Renato and Nazlya Syahputri) on November 2010.

2. Survey document of Social, Economic, Cultural conditions and perception of the community at villages around Estate/Mill of PT. Ramajaya Pramukti (including Ramabakti Estate) who supplies fruit to Kijang Mill, the document used is the Social Impact Assessment document which internally prepared by the company (Mr. Tomi Hendartomo, Yosaphat Ardhilla Renato and Ms. Nazlya Syahputri) on November 2010.

SIA analysis has also been equipped with the Social Impact Management Plan document describing the types of Social Impact, Source of Impact, Impact Management Measures, Management parameter, management location, period/schedule of management, details of impact management activities and related parties.

3. PT. BWL’s EIA for Nagasakti Estate including Kijang Estate. The Environmental Impact Assessment (EIA) document which was approved through Letter No IRC.220/888/B/V/1994 on 19 May 1994. In that EIA document there is an identification of social impacts that may arise from Oil palm plantation activities.

As a follow up to the results of ST2 audit, checking of social impact management realization in accordance with the previously established plan (SIA) is conducted. In document checking, the company showed the SOP used to perform the analysis of social impact and SOP for social impact management which is poured into SOP No. SOP/SPO/SMART/LH-13 on Social Impact Assessment (SIA), and SOP No. SOP/SPO/SMART/LH-12 on Social Impact Monitoring and Management.

In the SIA analysis document, there are three kinds of negative social impact which are identified and will be managed as follow :

- Damage of the road which will be managed through road maintenance by the use of heavy equipment (evaluated every year). Locations of road maintenance are not specifically mentioned in the review, so that maintenance will be more on response/reaction towards requests.

- Waste and air pollution which will be monitored every 6 months through ambient air quality measurement.

- Uneven distibution of labour recruitment, job vacancies and local business development.

In accordance with the social impact monitoring and management SOP that has been established, the company has prepared the report of social impact monitoring and management results. Report for the period of November 2010 – November 2011 can be demonstrated in the form of a document entitled : Report of the Implementation Result of Social Impact Management of PT. Buanawira Lestari Mas, Kampar District, Riau Province. Based on this report, a number of social impact handling activities were known as follow :

- Maintenance of damaged road around Kijang Estate plantation was conducted 5 times in the form of heavy equipment (greader) deliverance and its operational provision, on 11 February 2010 (Kota Aman village), in May 2010 (Koto Aman Village), 22 February 2010 (Kijang Makmur), 1 November 2010 (Tebing Lestari Village), 5 January 2011 (Tanah Tinggi Village), 15 June 2011 (Kijang Jaya 2011). However, the roadwork implementation model is still reactive to the requests and it hasn’t been planned. It is suggested, the road maintenance around the estate is done in a more well-planned and more programmed way.

- Monitoring of the quality of air and water around the plantation (ambient) by the Transmigration and Labour Ministry Laboratory of OHS Centre, Medan. Result of monitoring of semester 1 year 2011 can be demonstrated and all ambient air parameters were under the treshold.

- The communication of the employees’ needs from Estate Manager to villages around plantation especially villages which identified as exposed to impacts through letter to the village board. Some of the letter archives are for the Heads of the villages, e.g. the Head of Koto Aman Village. Its realization was the recruitment of labour from Koto Aman Village (11 people), Kijang Makmur Village (40 people) and Kijang Jaya Village (3 people).

The company is likely to have chances to improve the performance of social impact monitoring and management by creating more planned and systematic planning and monitoring, so that the progress of impact monitoring and management can be


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more scalable especially at villages which are identified as affected villages. . (Opportunity for Improvement No. 07)

- Consistent with ST1 and ST2, there has been no change in the scope of operations of PT. BWL as listed in the EIA

document year 1994 which being legalized through Letter No. IRC.220/888/B/V/1994 on 19 May 1994 for the scope of

Kijang Estate. So for PT. BWL, revision is not needed.

- However, with the additional of Ramabakti Estate as a supplier of fruit for Kijang Mill, a special environment document of

year 2011 which contains the additional of RBKE areas and Tapung Plasma River (Under the management of. PT. RJP)

entitled The Environmental Evaluation Document of Rama Bakti Estate Scheme and Smallholders Pattern Oil palm

Plantation of . PT. Ramajaya Pramukti on area of 8,488.79 hectares (Land Use Title 2,903.79 and scheme 5,585 hektar)

was prepared.

For the examination of documents in the surveillance 1 phase, it was known that the company prepared the a regular basis and scheduled report of environment monitoring and management which includes : 1. Environmental Management Plan – Environmental Monitoring Plan regularly reported to the relevant authority (The

Regional Environment Bodies) in a period of 6 months. The Environmental Management Plan- Environment Monitoring Plan of semester 1 year 2012 was submitted on 27 August 2012 to the Office of The Environment Bodies of Kampar District, in accordance with the the receipt document showed by the company.

2. Environmental Management Plan – Environmental Monitoring Plan regularly reported to the relevant authority (The Regional Environment Bodies) in a period of 6 months. The Environmental Management Plan- Environment Monitoring Plan of semester 1 year 2012 was submitted on 27 August 2012 to the Office of The Environment Bodies of Kampar District, in accordance with the the receipt document showed by the company.

3. Report of the monitoring of the implementation of effluent waste application at Rama Rama POM period I year 2012. 4. Environmental quarterly report of PT. Buana Wiralestari, Kijang POM unit period III year 2012. 5. Report of the results of Hazardous waste management (Balance sheet and log book) of PT. BWL, Kijang Unit Mill period

III year 2012. 6. Yearly report of social impact management realization for PT BWL, Kijang Estate Unit. 7. Yearly report of social impact management realization for PT. RJP, Ramabakti Estate unit. 8. Yearly report of HCV monitoring and Management of PT. BWL Kijang Estate unit.

9. Yearly report of HCV monitoring and Management of PT. RJP, Ramabakti Estate Unit.

Consistent with the results of ST1 and ST2 audit, the company has a scheme development program that is quite intensive. Structurally, the development of scheme in the Kijang Estate plantation is as described in the ST1 ans ST2. Kijang Plasma is being converted in year 1996, as for Sungai Tapung Plasma is being converted in year 1999. Kijang Plasma consists of 8 Village Cooperative Units from 8 villages with total of farmer groups is 197 (4,074 farmers). As for Sungai Tapung Plasma is consisting of 5 Village Cooperative Units from 5 villages with 135 farmer groups (2,768 farmers).

After conversion, the plantation is owned by the community. In year 1996, the established cooperation cheme is the un-managed scheme, however in the practice, an intensive sheme development wich receives very good response from the community has been established. Among those development activities are:

1. Implementation of proper agronomy standard through allocation of Head Assistant, Assistant, and Foreman in the Village Cooperative Unit who direct the maintenance and harvesting activities to conform with the proper agronomy standard. With the existence of active staff, maintenance rotation and harvesting are well controlled and fruit quality can be maintained. From data from the Village Cooperative Unit, it is known that the yield of Kijang scheme estate can reach 30 ton/ha/year for year 2012.

2. The procurement program of plantation infrastructures and facilities collectively runs by the company through interest-free credit model. This collective procurement ensures the better quality of fertilizer applied in addition to lightening the burden


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of the member of Village Cooperative Unit.

3. Village Board Support with rules that govern the harvest fruit quality requirements and security of scheme.

4. Replanting preparation program with replanting savings fund.

5. Environmental coaching through the repeated socialization of HCV area protection to the public.

6. Maintenance of road and bridge infrastructures with the help of the company.

7. Other forms of coaching

Results of public consultation at Kota Bangun Village (PT. RJP) and Kijang Makmur Village (PT. BWL) showed a high level of

satisfaction from the public to the performance of scheme management by the company (see results of public consultation at

the previous chapter).

Minor 6.1.1 Opportunity for Improvement No. 07

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.

- The company has SOPs related to the provision of information contained in the Consultation and Communication SOP(SOP/SPO/SMART/LH-19) on 01 July 2010.

- Records of communication with stakeholders in the form of Information and Communication Book and Consultation and Communication Book which equipped with physical evidence of information requests or delivery of information, response process and current status of the request and the deliverance of that information, for example : (a) Information Book which contains the provision of information from Kijang Estate to the external party (For example :

outgoing letter addressed to all Heads of the villages around Kijang estate on 16 March 2012 on Tsu Chi Health Social Service).

(b) Communication Book which contains information requests from stakeholders (for example : Incoming Letter from The Head of Kijang Makmur Village regarding the road maintenance on 24 October 2012.

BWL is able to show a list of relevant stakeholders. There is a change of person in charge (PIC) in Tapung Hilir Sub District. List of Stakeholders of PT. BWl consists of Statutory Bodies (6 agencies), Indigenous people (3 personnel), ); Local Communities (4 people), Workers Organization (8 people), Smallholders (8 VCU), Independent suppliers of FFB and services (6 institutions), aand NGOs (3 organizations). The company has owned an SOP related to the provision of information which contained in the Consultation and Communication SOP(SOP/SPO/SMART/LH-19) on 01 July 2010. It is mentioned in this SOP that response to the request of information is 1 month after the letter was received. The company has consistently keeps records of all incoming requests and provision of information. All records of information requests is recorded in the ‘Communication Book’ register book. For example: The availability of Communication Book which contains information requests from stakeholders (e.g. Incoming Letter from the Head of Kijang Makmur Village regarding road maintenance on 24 October 2012, responded on 25 October 2012. There are assigned officers which are responsible to perform consultation and communication with the community; 1. Kijang Estate: Mr. Ronny Panjaitan (Letter of ad-interim officer of RC Kampar No. 003/RC-Kampar/RSPO/01/2011 on 1

January 2011 regarding the person in charge of Social deeds. 2. Kijang Mill: Mr. Agus Murtadlo (Letter of PC Kampar on 4 June 2011 regarding the assigment of Unit Head as Social

Officer or person in charge of Social deeds.



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

BWL still refers to the Complaints and Dissatisfaction SOP (Document No. SOP/NP/SMART/XII/MCAR001) on 1 July 2010 which consists of the handling to Internal, External and complaints againsts female workers. In the attachment, there is flowchart of the handling of each complaint. Consistent with ST2 activities, all records of information requests and complaints are documented in the Communication Book which contains information of Number, Date and Letter Number, the sender’s name, the origin of institution, requests, purposes, initial, decision maker, disposition, reff/receipt Number and its latest status. Based on the results of visit to the community leaders and VCU administrators, there has not been a conflict between the company and the community. Light complaints which occured in the community will be delivered into the company either directly or written by the village Leaders/Officials and discussed with the company at the time of regular meetings of farmer groups/VCU. Communities around Kijang Estate and Kijang Mill are not indigenous people but participants of transmigration program from other areas. The owner of legal/traditional rights is mostly from the local village (Sekijang Village). The land acquisition process has been completed by the company to the entire of owned Land Use Title areas yet the company has provided the land conflict handling SOP (SOP/BWL/PKL) on 5 February 2010 which involves the participation of the community and institutions involved in the resolution of land conflicts.


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.

The company already has a land conflict handling procedure (SOP/BWL/PKL) on 5 February 2010 in which there is a mechanism to identify and calculate the land compensation, however at the time of ST2, compensation process has been completed to the entired owned Land Use Title areas and based on the results of interviews with the Leaders of Sekijang Village and Koto Aman Village who are the native people of the local villages stated that the previous land acquisition process has been done by involving the community leaders, Village Officials, land Acquisition Commitee (Consisting the Village Officials, BPN Officers, District Officers) and other related parties in accordance with the rules in force at that time. Associated with the land acquisition, the information received is still the same as the time of stage-2 implementation, which is the availability of compensation process document, records of identification of parties who received compensation for example Recapitulation of Land Owner/Cultivator List, plants and buildings which will be compensated by PT. Buana Wiralestari based on the decision result of Land Acquisition Commitee of Kampar district on 17 March 1992 at Bangkinang which describes the Name of Land Owner/Cultivator, Area of Land, Land Layout, Compensation price/m2, Total Compensation, Types of Compensation, Types of Plant, Compensation of Building, total compensation and signatures of parties who received compensation. In this records there are 707 farmers with areas of 2,467.2 Hectares with the amount of compensation IDR. 287,604,300,00 signed by the Land Acquisition Commitee of Kampar District that consists of the National Land Agency, Local Government of Kampar District, Head of Siak Hulu Sub District, Sekijang Village, and it is acknowledged by the Head of Kampar District. The compensation payment document is available, for example :

1. Waiver statement signed by the parties concerned and witnessed by the Head of National Land Agency office of Kampar District, Assistant of Kampar Regent Office, Head of Sub District and Head of Sekijang Village.

2. Stamped Compensation Receipt Letter.


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Inventory list of Land, Plants and other efforts in the context of area acquisition signed by the land owner, the company and the Inventory Commitee of Kampar District. For example : Mr. Diba/Liman; resident of Sekijang Village got a compensation of IDR 300,000 on a land area of 6 hectares which realized on 9 November 1992.


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.

- Riau Governor Regulation No. 48 year 2011 on the Provincial Minimum Wages (PMW) year 2012 and Riau Governor Regulation no. 54 year 2011 on the Minimum Wages of 12 Districts/Cities of Riau Province (PMW) year 2012 set at IDR 1,238,000/month.

- PT. BWL wages provision refers to the Circulars from the Sumatran Plantation Companies Cooperation Board (BKS-PPS) No. 15/BKS-PPS/2012 on 9 february 2012 which set the agreement on the permanent daily workers minimum wages of IDR 1,282,200/month (higher than the Provincial Minimum Wages). Based on that agreement, PT. RJP established it through the decree of the wages establishment as follow : a. Decree No. 005/CEO 5/HR PSM 5/02/12 on the Permanent Daily Worker Wages (SKU-H). Established on 1 January

2012, for employees with working period less than 1 year IDR 1,282,200/month and working period 1 year or more IDR. 1,284,700/month.

b. Decree No. 006/CEO 5/HR PSM 5/02/12 on the Monthly SKU Worker Wages, established on 1 January 2012, according to their levels, starts from the lowest level G1 of IDR 1,339,500/month until the highest level A8 of IDR 2,264,350/month.

c. Decree No. 004/CEO 5/HR PSM 5/02/12 on the Temporary Daily Worker wages on 1 January 2012 which is IDR. 55,578/day, Based on the results of inteviews with HRD staff, there is no provision from the company regarding the assignment of Temporary Daily Worker who has been working for 20 day/month for 3 consecuitive months to become a permanent daily worker (SKU-H), it is only based on the decision of each operational unit and the willingness of the worker whether she/he wants to be a permanen daily worker or not.

Detail list of the salary of SKU Daily Worker Wages at Kijang Mill and Kijang Estate in period September 2012 is available and so are the allowances, overtime and the employees’ premium earned. The company regulations of PT. SMART Tbk year 2011-2012 which has been legalized by the Directorate General of Industrial Relationship and Workers Social Assurance No. 808/PHIJSK-PKKAD/PP /XII/2010. The content of the regulation is still the same with the company regulation in year 2010-2011. Based on the results of field visits at Kijang Estate, there are G2 housing/cottage, places of worship, schools, daycare centers, sport facilities, clean water tank and new facilitity such as Smart House (Rumah Pintar). Smart House (Rumah Pintar) is a solidarity program of the wives of “Indonesia Bersatu” cabinet chapter II which is chaired by Mrs. Ani Yudhoyono (First Lady) and in cooperation with PT. SMART, Tbk. Smart House (Rumah pintar) is a non formal education facility devoted to children and mothers in the plantation and the communities around the estate. Facilities available at the Smart House (Rumah pintar) are libraries, Computer rooms, Kriya Rooms, and educative games. Children are supervised by 1 tutor and 1 assistant. Activities at the Smart House (Rumah Pintar) are teaching writing, reading, singing, dancing for children and creative activities such as cooking, sewing and making cookies for mothers. So the children and mothers could use those facilities maximally with purpose of expanding positive and knowledge activites. In the agreement/contract with the contractor, the company requires the contractor to fulfill some requirements in term of employment as follow :

- Article 4 Tax and Labour Social Assurance, point 8 Labour Social Assurance and its premiums on workers who are employed for that job on article 5 is handled and paid fully by the second party in accordance with the applicable regulations.


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- Article 5 specifications and requirements of work, point 15 in doing the job, second party ensures the health and safety of its whole workers and is required to equip its workers with personal protective equipment in accordance with the applicable regulations.

- Article 6 Facilities of Work, point 2 second party must provide a minimum of 3 dump trucks with bin capacity 6-10 ton/truck in a proper condition and ready to be used. Point 3 Vehicle and driver paper; Vehicle Ownership Certificate, Vehicle Registration Certificate, and Vehicle Feasibility Certificate, Driving License and First Aid Emergency Box.

Based on the results of document and implementation review, there is an employment contract on behalf of Riyanto (U.D Bina Karya) as transporter of FFB deliverance to Rama-Rama POM, Nagasakti POM, Libo POM, Ujung Tanjung POM, and Sam-Sam POM No. 002/NSAE/01/2012/KBN-Akt/TBS with a term of 5 years contract period from 1 January 2012 until 30 June 2017. Based on the contractor safety inspection on 16 June 2012, contractor has not met the requirement related to employment which is the Labour Social Assurance. The company advises (the contractor) to enroll the workers to the Labour Social Assurance and follow up to this case, the company sent a letter to U.D Bina Karya as contractor on 1 July 2010 regarding the contractor’s employment Labour Social Assurance.


6.6 T he 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.

The Head of work unit of the Federation of Agriculture and Plantation Workers Union of Indonesia (PUK SPPP – SPSI) of PT. BWL Kijang POM records no. 560/DTK-SPPP-SPSI/2008/08 on 11 August 2008. The Head of work unit of the Federation of Agriculture and Plantation Workers Union of Indonesia (PUK SPPP – SPSI) of PT. BWL Kijang Estate no. 18/DPC-FSPP-SPSI/KPR/XI/2009 approval on 01 December 2012 with term of service 2009-2012. There are records of meeting on 11 August 2012 with agenda of meeting is the case of layoff on behalf of Mr. Misgianto which was done by the company can be followed up, after its chronology has been checked, it turns out that Mr. Misgianto is guilty of breaking the rules by stealing. Records of meeting on 7 August 2012 with agenda of meeting is the discussion of entertainment fund utilization (fund fiven for the workers’ entertainment), with results of meeting is the utilization of fund for the workers entertainment and partly to increase the Indonesian Workers Union’s assets.


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.

Related to the policy of not employing under-aged children, BWL still refers to the Company’s Policy on the worker’s age requirements set in the Circular of HR Director No. 002/SE-HRDV//03/09 on 31 March 2009 that the worker’s minimum age limits is 18 years old. The employees’ updated data on 3 October 2012 at Kijang Mill with total of 147 employess and Kijang Estate on 31 October 2012 with total of 282 employees are available. Those document show the employee’s name, date of birth, gender, religion, ethnic, educational level and job entry date (SKU), Based on those documents, there is no employee whose age is under 18 years old.



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6.8 Any form of discrimination based on race, caste, national origin, religion, disability, gender, sexual orientation, union membership, political affiliation, or age, is prohibited.

There is circular No. 003/CE05-SE/06/2009 on 24 June 2009 which regulates the implementation of industrial relations in the unit, one of them is that the company gives employees the freedom to work in any kind of work field without any discrimination such as ethnic, religion, race and gender. The employees’ updated data on 3 October 2012 at Kijang Mill and 31 October 2012 at Kijang Estate are available. Based on those document, the workers come from different tribes such as Javanese, Bataknese, Minang and Banjar, Moslem and Christian religion, female and male gender, which proves the equal opportunities and treatment in employment.


6.9 A policy to prevent sexual harassment and other forms of violence against women and to protect their reproductive rights are developed and applied.

Agronomy Unit Head Circular No.001/CEO5-SE/02/2009 on 20 February 2009 legalized by Fransiscus Costan which regulates the socialization of prevention and handling of sexual harassment to all employees is available. There is Circular No. 001/SE-VPA5/SPO/07/2011, legalized by B. Vijayakumaran on 8 July 2011 stated that Pregnant and breastfeeding women are prohibited from working in spraying activities and works that are directly exposed to the management of hazardous chemicals in accordance with the applicable regulations. There is also Circular No. 002/CEO5-SE/03/2009 on 2 March 2009 legalized by Franciscus Costan (CEO 5) regarding the provision of D1 menstruation period permission, worker is not required to work at the first and the second day of menstruation period based on examination by the company’s doctor. The update of women commision at Kijang Estate chaired by Mrs. Ismiati, was legalized on 1 February 2012. The women commission work program includes : socialization of sexual harassment issues, Day Care facilities inspection, Posyandu (Integrated Health Center-IHC), socialization at Rumah Pintar (Smart Home). There is the flow of sexual harassment handling as follow:

1. In case of sexual harassment takes place, file a report to IKISTRA (Association of Women Staff II in Riau Province), or to the Women Commission officials (SPSI), either verbally or in writing. IKISTRA and SPSI shall then analyze/process the complaint using information from the victim as the investigating ground.

2. IKISTRA and SPSI shall assist the victim in filing a report to the Head of Unit. 3. Using the information and the gathered data, the Head of Unit shall conduct necessary investigation to gather more

solid evidence. 4. When convicted guilty, the offender will face serious threats as the Head of Unit is fully authorized to apply sanctions

according to applicable Laws and Regulations of the company, or to further bring the case to a higher law. There are records of sexual harassment training conducted on 15 February 2012, at the morning circle with the loose fruit collector as the participants. The proof of D1 implementation is Attendance List of SKU workers of Division I in October 2012, for example: worker on behalf of Lamini (fruit loose collector), the D1 was on 27-28 September 2012, Irah (fruit loose collector) on 4-5 October 2012 Based on Complaints Handling Log Book of Kijang Mill and Estate, period of January – October 2012, there were no complaints from workers.



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

There is Cooperation Agreement between PT. BWL and Farmers Cooperative on Business Partnership of PIR TRANS project of PT. BWL and its Addendum, such as the Cooperation Agreement between PT. BWL with VCU Makarti Buana Jaya, Sekijang Village Tapung Subdistrict, Kampar District No. 01/SPK-BWL/DL/III/96 dated 29 March 1996 acknowledged by the Head of Plantation Agency of Riau Province and Head of Kampar District; Addendum No. 001/SPK-BWLM/KKCP/I/IX/2004 dated 30 September 2004. This Addendum was made because loan installments have been paid by the farmers. The results of the visit in VCU Makarti Buana Jaya, Kijang Jaya Village (SP 1), and VCU Berkat Ridlo and VCU Manca Warga stated that FFB prices is based on FFB price issued by the Plantation Agency of Riau Province as the result of Pricing Committee Meeting which consists of representatives of the Company, Oil Palm Smallholders, Local Government. Meetings are conducted once a week on Tuesdays and pricing decisions comes into force on Wednesday. For example;

a. Decree of Minutes of Oil Palm FFB Buying Price Determination Team Meeting Result of Riau Province No. 26/TPH TBS-VI/2011 dated 28 June 2011 period of Wednesday, 29 June to Tuesday, 5 July 2011. The FFB Price for the said period was IDR 1,612.65 /Kg FFB (Age >= 10 Years).

b. Decree of Minutes of Oil Palm FFB Buying Price Determination Team Meeting Result of Riau Province. 27/TPH TBS-VII/2011 period of Wednesday, 6 July to Tuesday, 12 July 2011. The FFB Price for the said period was IDR 1,467.97/Kg FFB (Age>= 10 Year).

FFB Pricing based on Minutes of Oil Palm FFB Buying Price Determination Team Meeting Result of Riau Province of the smallholders’ production is done every two weeks and valid for the following two weeks, for example;

a. FFB Price for period of 29 June to 5 July 2011 based on Minutes No. 26/TPH TBS-VI/2011 dated 28 June 2011. b. FFB Price for period of 15 June to 21 June 2011 based on Minutes No. 24/TPH TBS-VI/2011 dated 14 June 2011.

The results of interviews with administrators of VCU Makarti Buana Jaya, Kijang Jaya Village (SP 1), and VCU Berkat Ridlo and VCU Manca Warga stated that they understand the contract agreement that they agreed with the company and they got fair treatment in the agreement, for example, the FFB purchase contract, provision of fertilizers, transport for FFB, etc. The results of interviews with administrators of VCU Makarti Buana Jaya, Kijang Jaya Village (SP 1), and VCU Berkat Ridlo and VCU Manca Warga stated that payment of FFB in accordance with the agreement was made every two weeks through direct deposit to the bank account of VCU.


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

Consistent with the results of the ST 1 and ST2 audit, a number of recordings that show the company's contribution to local development can be shown for Kijang Estate and Ramabakti Estate, among them: a. CSR recapitulation document of Kijang Estate and Ramabakti period of 2012 are documented in the CSR document.

CSR implementation recapitulation documents of the Kijang Estate signed by Kijang Estate Manager, total CSR expenditures for the Kijang Estate in 2012 ranged from IDR 120,681,980 consisting of activities: teachers’ honorarium assistance, support of youth activities, village government activities, social activities, etc. While CSR implementation recapitulation document of Ramabakti Estate signed by Ramabakti Estate Manager, total CSR expenditure for Ramabakti Estate was IDR 52,500,000 used for the activity: teachers’ honorarium assistance, support of youth activities, village government activities, social activities, etc.

b. Local Contract Agreement Document and Local purchases by Kijang Estate and Ramabakti Estate. c. Local Contract Agreement Document and Local purchases by Kijang Mill in 2012 documented in the Internal Purchase

Requisition Document Recapitulation (Local PPI) and Local Contract Agreement Recapitulation Document (Local PO).


ASSESSMENT REPORT


d. Documents of tax payments such as VAT / Income Tax, Tax of Utilization of Ground Water etc.


PRINCIPLE #7 RESPONSIBLE DEVELOPMENTS OF NEW PLANTINGS.

Not Applicable; company did not open / develop new oil palm plantations after November 2005.

Status : Not Applicable

PRINCIPLE #8 COMMITMENTS TO CONTINUOUS IMPROVEMENT IN KEY AREAS OF ACTIVITY.

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

The company already has an Internal Audit mechanism related to the implementation of the RSPO principles and criteria. The last assessment was conducted on 6 to 10 August 2012. BWL also conducts management reviews on the application of the principles and criteria of the RSPO. Management Review was conducted on 10 October 2012. Management review was done to see the progress status of audit findings.



ASSESSMENT REPORT


3.2. Summary of Assessment Report of Supply Chain

Clause Requirements of Mass Balance Supply Chain Models

1 Documented Procedures

1.1

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

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

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

a) The Company has established the procedure for Identification and Traceability Capability (PT BWL-KJGM/SOP/01), authorized on 8 July 2012. This procedure describes the following mechanisms; 1) fruits reception (whether from the smallholders estate, scheme smallholders estate, or from the supplier / independent smallholders); 2) processing; 3) storage of palm oil and palm kernel in the storage tank; and 4) delivery of products (CPO and palm kernel) to Dumai Bulking Station. This procedure also specifies the supply chain system applied based on the principles of Mass Balance where FFB derived from different sources are processed together. This procedure also stipulates that FFB reception whether from smallholder’s estate or from non-smallholders, is distinguished from the recording of weightbridge acceptance code. One of such records provided is in a form of weightbridge tickets. Afterwards, all FFB is processed simultaneously, as for the shipment of claimed to be certified CPO or palm kernel, it shall use a Product Delivery Memo.

b) The personnel responsible for the implementation of this system are as follow:

Assistant, responsible for supervising whether the FFB received is in conformity with the standards and criteria specified, FFB processing supervising, monitoring the process of analyzing the quality of processed products.

Head of Administration, responsible for conducting the recording and reporting of the quantity and quality of processed products on a regular basis, monitoring the administration process for FFB reception, and delivery of processed products, regularly checking the essential tools used in the supply chain to keep them in a good condition, accurate, licensed, and well maintained.

Mill Unit Head (Management Representative), responsible for ensuring all process of the supply chain to be well implemented, ensuring that Mass Balance calculation has been done correctly to be able to determine the number of certified products, providing information to those who need, related to the certified product.

Production Controller (Top Management), responsible for ensuring and offering guarantees that the resulting product can be traced back to their sources and delivery of the product is acceptable according to the quantity and quality.


1.2

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

See explanation of 1.1 BWL (Kijang POM) has established the mass balance model to separate the certified products from those non-certified. The implementation of this model is by putting the "Mass Balance" stamp on the Fruit Dispatch Memo (SPB).


2 Purchasing and goods in


ASSESSMENT REPORT


2.1

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

The FFB received by Kijang POM came from the RSPO certified Smallholders Estate, namely Kijang Estate, scheme smallholders and from the Independent Smallholder. BWL has a mechanism to separate the certified FFB from those non-certified. This selection is done by applying "a Mass Balance Stamp" to FFB originating from RSPO certified estates. For example: - Fruit Dispatch Memo (SPB) (No. 20227/TBS/2/10/12/KJGE) FFB Origin Block L18, L17 KGJE; Date 2 October

2012; Quantity 2,600 Kg; Vehicle’s License Plate Number BM 8620 JB; Fruit Dispatch Memo is “Mass Balance” stamped.

- Fruit Dispatch Memo (SPB) (No. KJNP/TBS/08/12) FFB Origin Block K19 Kijang Kencana Plasma; Date 8 October 2012; Vehicle’s License Plate Number BM 8964 W; Fruit Dispatch Memo is not “Mass Balance” stamped because Kijang Kencana Plasma has not been RSPO certified.

- Weightbridge Card (Delivery Note. 3022/TBS/02/12/10/9100) FFB Origin Kijang Estate; Quantity 2,990 Kg; Weightbridge Card is “Mass Balance” stamped.


2.2

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

BWL (Nagasakti POM) has projected that the CPO production in 2012 would reach 22,408 tons, and the actual production until September 2012 was 18,943 tons. Based on SOP for the Identification and Traceability Capability (PT BWL-NSAM/SOP/01), it is stated that BWL is committed to reporting to the Certification Body, should the production of CPO exceeds the projected claim.


3 Record keeping

3.1

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

The entire records and reports have been fully made and kept by the company. The soft copy form of the document storage system is kept using System Application Program (SAP), while the hard copy (print out) version is stored in the cabinet in the administration room of Nagasakti POM.


3.2

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

In the procedure for the Identification and Traceability Capability (PT BWL-KJGM/SOP/01), the company has established 10 (ten)-year retention time for all records or reports of FFB reception at POM, palm oil processing, storing of CPO products, Palm Kernel, and CPO product shipments.



ASSESSMENT REPORT


3.3 (a) The facility shall record and balance all receipts of RSPO certified FFB and deliveries of RSPO certified CPO, PKO and

palm kernel meal on a three-monthly basis. (b) All volumes of palm oil and palm kernel oil that are delivered are deducted from the material accounting system

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

a. Kijang POM has recorded all RSPO certified FFB, by giving a special marking on those originating from the certified estates. However, based on information from one of the staff, it was revealed that Kijang POM has not made any sale of the certified CPO. For example: Sales Contract Number 005/BWL/CPO/EX/12 dated 16 May 2012 did not state that the products generated were RSPO certified.

b. Kijang POM is able to show the records of CPO shipment volumes, which were being sent to Bulking Station. For example: Delivery Record of a 37,500 kg of CPO to Bulking Station dated 30 October 2012.

c. Although KJGM has established the "Mass Balance supply chain model", the company admitted that they did not sell any RSPO certified CPO.

Status : Observation

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

KJGM has specified that the model of supply chain used is Mass Balance. KJGM implements this Mass Balance model only on FFB admissions process, to CPO dispatch, up to the Bulking Station. However, KJGM does not sell the RSPO certified palm oil.


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

Not Applicable. KJGM is not performing Palm Kernel processing.

Status : Not Applicable

4 Sales and goods out

There is Sales Contract Number 005/BWL/CPO/EX/12 containing information regarding: (a) Name and address of buyer Golden Agri International PTE, LTD; Address 108 Pasir Panjang Road #06 – 00

Golden Agri Plaza Singapore 118535. (b) Date of invoice issuance 16 May 2012

(c) Description of product; is an applicable supply chain model (Segregation or Mass Balance) The specification of CPO product shipped to the buyer is available. For example: FFA content. However, the sales contract document does not describe the applied supply chain model and information on RSPO Certified.

(d) The amount of product shipped 4,000 ton CPO

a. Kijang POM has recorded all RSPO certified FFB, by giving a special marking on those originating from the certified estates. However, based on information from one of the staff, it was revealed that Kijang POM has not made any sale of the certified CPO.

b. Kijang POM is able to show the records of CPO shipment volumes, which were being sent to Bulking Station. For example: Delivery Record of a 39,500 kg of CPO to Bulking Station dated 29 October 2012.


ASSESSMENT REPORT


c. Although KJGM has established the "Mass Balance supply chain model", the company admitted that they did not sell any RSPO certified CPO.


5 Training

5.1

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

KJGM has provided training for the all staff, associated with the procedure Supply Chain Certification System, which has been done 2 times. The initial training was conducted on 11 August 2011. At the time of surveillance activity was conducted, KJGM was able to present the proof of the most recent training which held on 12 March 2012 in the Meeting Room of PC / RC Office, and was attended by all KJGM staff.


6 Claims

6.1

The facility shall only make claims regarding the use of or support of RSPO certified oil palm products that are in compliance with the RSPO Rules for Communications and Claims (refer to Annex 10).

KJGM has not been able to show the use of claims to support RSPO certified palm oil in accordance with the RSPO Guidelines for Communication and Claims indicated in the Sales Contract, Delivery Order and Invoice.



ASSESSMENT REPORT


3.3. Conformity Checklist of Certificate and Logo Use

1. Bukti Persetujuan/ijin mengenai penggunaan Sertifikat dan logo

Status

Perusahaan telah menerima bukti persetujuan/izin mengenai penggunaan sertifikat dan logo RSPO dari Lembaga Sertifikasi PT Mutuagung Lestari (No. Surat 099.19/MUTU/I/2012)

√

2. Implementasi/penerapan sertifikat dan logo oleh klien yang sesuai dengan bentuk dan ukuran seperti yang dijelaskan dalam pedoman penggunaan logo

Not Applicable; Perusahaan tidak menggunakan logo baik di dalam produknya (on-product) dan bukan produk (off-product) Di dalam ruang lingkup PT. BUANA WIRALESTARI MAS – Kijang Mill Scope

×

3. Implementasi/penerapan sertifikat dan logo yang tidak digunakan pada produk


×

4. Pengendalian sertifikat dan logo oleh klien termasuk pengendalian/ penarikan Logo yang tidak sesuai


×


ASSESSMENT REPORT


3.4. Summary of Time Bound Plan Verification of the RSPO Certification Total companies visited (0.8 √Y) Where Y is the total of one holding company. The company name : Indrasakti Mill (PT. Buana Wiralestari Mas) with 4 (one) Estate such as Indrasakti Estate, Indrasakti Plasma, Indragiri Plasma, Indralestari Plasma (PT. Meganusa Inti Sawit)

2.1

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

Indrasakti POM (PT. Buana Wiralestari Mas) is compliance with applicable laws and regulations. √

2.2

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

Indrasakti POM (PT. Buana Wiralestari Mas) has demonstrated land use and not legitimately contested by local communities.

√

6.3

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

Indrasakti POM (PT. Buana Wiralestari Mas) has documented system for dealing with complaints and grievances, which is implemented and accepted by all parties

√

6.4

Any negotiations concerning compensation for loss of legal or customary rights are dealt with through a documented system that enables indigenous peoples, local communities and other stakeholders to express their views through their own representative institutions.

Indrasakti POM (PT. Buana Wiralestari Mas) has SOP of Land Compensation Standard and Identification No. SOP/NP/SMART/VII/D&L002, describe Land identification, settlement patterns, Consultative Process Claims, Payment and Reporting Procedures.

√

7.3

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

Indrasakti POM (PT. Buana Wiralestari Mas) and its supply base have not replaced primary forest or any area required to maintain or enhance one or more High Conservation Values

√

7.5

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

Indrasakti POM (PT. Buana Wiralestari Mas) and its supply base no plantings established on local peoples’ land without their free, prior and informed consent

√

7.6

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

Indrasakti POM (PT. Buana Wiralestari Mas) and its supply base no plantings established on local peoples’ land without their free, prior and informed consent

√


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SPO – 4006a.4 Page 47

Prepared by Mutuagung Lestari for PT. Buana Wiralestari Mas – Kijang POM

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

Further explanation of the non-conformities raised and corrective actions taken by BWL are provided in this section. BWL prepared a corrective action that was reviewed and accepted by MUTU and corrective actions taken to close all non-conformities shall be verified during next assessment.

3.5.1 Identification of Findings, Corrective Action, Observations at Stage-1 Assessment

No. Ref Std/ Indicator

Non-conformance Grade Location Requests for Corrective Actions

Time Limit Observation and Date Status Closed date

2010.01 2.1.1 The evidence of compliance with regulation – The evidence that the company has not complied with some regulations was found. E.g.: Minister of Agriculture Regulation No 7 year 2007 Article 7 concerning spray workers training in using limited pesticide (Paraquat); Occupational Health and Safety (OHS) license for tractor operator in the estate in accordance with Minister of Labor Regulation No.9 year 2010 article 3, 4, 5, 11, and 13 concerning Operator and Personnel of Lifting and Conveyance Machine.

NC Mill and Estate

The company must provide evidence of compliance with all relevant regulations, some of which are: Minister of Agriculture Regulation No 7 year 2007 Article 7; and Minister of Labor Regulation No.9 year 2010 articles 3, 4, 5, 11, and 13.

Before Stage-2

The company has done training for limited pesticide (Paraquat) spray workers which was given by Pesticide Commission of Plantation Agency of Riau Province (Mr. Suratmo, SP.) on 8 February 2011. The training was attended by personnel’s from Kijang Estate, Nagamas Estate, Ramabakti Estate, Ramarama Estate and Nagasakti Estate. The company has also got Occupational Health and Safety (OHS) license for heavy equipment operator in the estate (Kijang Estate): 9 personnel’s of heavy equipment operator in Kijang Estate who have got Lifting and Conveyance Machine Operator Certificate, for example Mr.

Closed July, 12th 2011


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Urusan Purba has got Tractor Operator Certificate No. 10.7362/OPF/KK/XII/2010 dated 13 December 2010 valid until 13 December 2015 issued by Directorate General of Labor Assistance and Monitoring, Minister of Labor and Transmigration. Recapitulation of SIO operator of Kijang Mill is available including 11 persons who have attended training.

2010.02 2.1.2 The evidence of adjustment to regulation change – The evidence that the company has not done efforts to adjust to the regulation change is available, e.g.: hazardous material symbol installation in accordance with Minister of Environment Regulation No 3 year 2008.

CFA Mill and Estate

The company is suggested to do efforts to adjust to the regulation change related to mill and plantation activities.

Before Stage-2

The company has done evaluation per article to the related regulations and the implementation of them. The evaluation was documented in documents of evaluation of Compliance with Regulations, Acts and other requirements. Based on field visits to hazardous waste storage in Kijang Estate and Kijang Mill, the company has adjusted the hazardous material symbol installation in accordance with Minister of Environment Regulation No 3 year 2008.



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2010.03 2.1.3 Regulation list – The company has got list of the regulations concerning the activities in mill and plantation. However, the list has not covered all of the relevant regional regulations, for example: Governor of Riau Regulation No. 95 year 2009 about district and municipality minimum wage in Riau Province; Governor Regulation No 35 year 2007 about quality standard of liquid waste.

CFA Mill and Estate

It is suggested to complete the list of regulation concerning the mill and plantation activities with all the valid regulations including regional regulation.

Before Stage-2

The company has completed the list of regulation related to the mill and plantation activities, e.g.; Governor Regulation No.95 year 2009 concerning district and municipality minimum wage of Riau Province has been changed to Governor Regulation No. 10 year 2011 concerning minimum wage in Coconut and Oil Palm, and Rubber Agriculture/Plantation Sub Sector of Riau Province year 2011 dated 1 February 2011


2010.04 2.1.4 Regulation fulfillment Evaluation – The company has had the document of Regulation and its compliance list. However, it has not covered the evaluation of all articles which have to be complied in the regulation related to activities in plantation and mill.

CFA Mill and Estate

It is suggested to do evaluation to the articles which have to be fulfilled in the related regulation.

Before stage-2

The company has conduct evaluation per articles in related regulations and the implementation of the regulation which is documented in documents of Evaluation of Compliance with Regulations, Acts and other requirements.


2010.05 3.1.1 Long term plan – The company has had long term work plan in The Company Work Plan document of PT Buana Wira Lestari Mas year 2010 - 2017. However, the evidence of

CFA Mill and Estate

It is suggested to endorse documents of long term work plan owned.

Before stage-2

The company has endorsed the document of the company’s long term work plan of PT Buana Wiralestari Mas year 2010 to 2017 which includes production



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endorsement from the management has not been available.

estimation, FFB cost, Mill cost, oil palm product cost/kg, recapitulation of mill production (OER and KER), and other financial parameters. The endorsement of the document was done by PSM 5 CEO (Mr. Fransiscus Costan).

2010.06 3.1.2 Re-planting program plan – There is replanting program plan which will start in 2017. However, annual study evidence of the replanting program has not been available.

CFA Estate The company is suggested to provide annual inspection evidence of replanting program planned.

Before stage-2

While the stage-1 activity was being done, the company already had replanting plan which will be done in 2017. This replanting program plan is still a plan submission from estate management unit and has not been validated by the top management. While the stage-2 activity was being done, replanting plan was reviewed with the result of the change of the year of program 2017 became 2016. This change of plan was the result of annual study which has been done by the company related to replanting activity. The study itself was done based on criteria of plants age, plants



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length and production estimation (in accordance with one of the replanting criteria in existing SOP).

2010.07 4.1.2 Mill’s SOP – The company has had mill’s SOP in form of document of Palm Oil Mill Management SOP, PT SMART Tbk. However, it has not explained the procedure of supply chain product traceability system in the mechanism of fruit reception until palm oil dispatch; because there are mills that received fruit outside the certification range. E.g.: fruit reception procedure in Kijang Mill which receives fruit supply from smallholder’s estate.

CFA Mill It is suggested to revise Mill’s SOP and explain the procedure of supply chain product traceability system, in the mechanism of fruit reception until palm oil dispatch, for mills that receive fruit supply outside the certification range.

Before stage-2

The company has arranged the procedure of product traceability in Supply Chain SOP (SOP/BWLM/SC) endorsed on 12 July 2011. This procedure explains palm oil and kernel production process system with Mass Balance Supply Chain system.


2010.08 4.4.2 Water quality monitoring evaluation – The company has provided record of water quality test result done by SMARTRI laboratory; however the evaluation evidence of the tested parameter in accordance with the quality standard decided has not been available.

CFA Mill It is suggested to do evaluation of water quality monitoring data of tested parameters in accordance with the quality standard decided

Before stage-2

The evaluation of monitoring well water quality test result is stated in POM Liquid Waste Application Implementation to Oil Palm Plantation Land Monitoring Report document; this report is arranged every 6 months as reporting material to Environmental Agency (BLH) of Kampar District.



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2010.09 4.4.3 BOD of liquid waste Monitoring Evaluation – The company has provided liquid waste’s BOD monitoring report, however evaluation evidence to the tested parameter in accordance with existing quality standard has not been available.

CFA Mill It is suggested to conduct evaluation of BOD monitoring data and the tested parameters in accordance with existing quality standard.

Before stage-2

Monitoring result evaluation evidence of liquid waste’s BOD is available in form of Land Application Study document 2011. The evaluation result shows that the test result of Jan-June 2011 period has parameters which are over quality standard which were COD in January, February, March 2011, and June 2011; whereas April and May 2011 period met the quality standard.


2010.10 4.4.4 Monitoring evaluation of water Use per ton FFB– The company has provided monitoring record of water use per ton FFB in the mill, however the monitoring data evaluation evidence of water used and budget allocated has not been available.

CFA Mill It is suggested to conduct monitoring data evaluation of the of water use per ton FFB in the mill against the budget allocated

Before stage-2

The company has also done evaluation of the use of water compared to the budget allocated. The result shows that during Jan-May 2011 the use of water was still below the budget


2010.11 4.6.1 Licensed pesticide evidence – The company is able show record evidence of the use of licensed and registered pesticide, however there is evidence that some pesticides has expired registration license. E.g.: Ally 20 WP pesticide has expired since 14 June 2009.

CFA Estate It is suggested to provide evidence that all of pesticides used are still on valid period

Before stage-2

The company has shown evidence based on Agriculture and Forestry Pesticide book year 2010 issued by Investment and License Central Secretariat General, Ministry of Agriculture of Republic Indonesia that the validity



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period of license of Ally 20 WP pesticide has been extended until 30 April 2014. And based on the record of agrochemical material used in Kijang Estate, Ally 20 WP pesticide has been no longer used since February 2010.

2010.12 4.6.4 Pesticide‘s used packaging waste – Based on SOP of waste treatment and minutes of hazardous waste stockpiling, there was information that pesticide’s used packaging waste treatment was done by burying it underground, and there was not enough evidence that the company has communicate with the related institution in associated with pesticide’s used packaging stockpiling agreement under the ground in accordance with the existing regulation.

NC Estate The company is suggested to provide the evidence of communication with the related institution in associated with the agreement of pesticide’s used packaging stockpiling underground in accordance with the applicable regulation

Before stage-2

The company has changed the SOP related to waste treatment (SOP/BWL/LBH revised 01). Pesticide’s used packaging waste is no longer buried underground but it is returned to the vendor/supplier.


2010.13 4.7.8 Fire extinguisher tube – The company has had adequate fire extinguisher equipment and it has done periodic examination to that equipment. However, based on the field visit, the evidence that the fire extinguisher tube has not

CFA Mill and Estate

It is suggested to complete the validation period information of each fire extinguisher tube available.

Before stage-2

The company has completed First Aid and Occupational Health and Safety (OHS) equipments and it also conducted regular monitoring. APAR (fire extinguisher tube) has



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been completed with validation period information was found.

been completed with validation period and the maintenance checklist.

2010.14 4.8.1 Plasma Smallholder training Program - The company has done training to plasma smallholders by giving regular counseling, However there was not enough evidence of documented training program for plasma smallholders.

CFA Estate It is suggested to provide documented training program for plasma smallholders.

Before stage-2

Document of Counseling and Training for plasma smallholder of Kijang Plasma Estate (KJNP) was available. The document stated Counseling Program. For instance: Integrated Pest Management counseling was done on 01 December 2010, oil palm fertilization was done on 24 November 2010.


2010.15 5.1.2 Environmental Management Plan Environmental Monitoring Plan (RKL/RPL) Implementation Report - RKL/RPL implementation report of PT Buana Wira Lestari Mas is available every 6 months, however the content of the report has not explained all parameters of the environmental impact management based on RKL/RPL document year 1996, e.g.: management and monitoring of disruption to and by elephant; observation and estimation of canal water surface height in peat land.

CFA Mill and Estate

It is suggested to revise the document of RKL/RPL implementation report and adjust the report content with all parameters of the environmental impact management based on RKL/RPL documents year 1996

Before stage-2

The company has revised the content of RKL/RPL Report by adding all parameters of the environmental impact management based on RKL/RPL document year 1996 including management and monitoring of disruption to and by elephant; observation and estimation of canal water surface height in peat land. In RKL/RPL Report period II (July to December) year 2010, it is stated that management and monitoring of disruption to and by



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elephant has not been done anymore because it has been a long time (10 years) since the last disruption by elephant.

2010.16 5.2.1 HCV Identification Document – HCV Identification document for PT Buana Wira Lestari Mas area was available, however the compiling process and the document content has not been entirely correspond to HCV Identification Toolkit issued by Indonesia HCV Toolkit Consortium in May 2008. For instance: report compiling outline, supporting data used, document legalization by the management, public consultation implementation evidence, scale of map was not in accordance with the document print out, there is no peer review report process conducted, and competency of the compiling team.

NC Mill The company has to revise HCV Identification document by conforming whole compiling process and the document content to be correspond to HCV Identification Toolkit issued by Indonesia HCV Toolkit Consortium in May 2008.

Before stage-2

There is HCV Identification document for PT BWL compiled by Internal Team of HCV identification compiling which consists of 5 persons (Norman Faried Mustakim; approved RSPO HCV Assessor, Kusuma Widya Rochmah; approved RSPO HCV Assessor, Tomi Herdartomo, Nazlya Syahputri and Bambang Setyaji) who were endorsed in February 2011. Peer review was done by external party (Dwi Rahman Muhtaman) in October 2010. From that document, High Conservation Value (HCV) areas are identified, which are 1.1, 1.2 and 4.1 with the total KBKT area of 411.55 Ha. There is also identified protected animal; White-throated Kingfisher (Halcyon smyrnensis) and Leopard Cat (Felis bengalensis).



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2010.17 5.2.2 5.2.3

HVC Area Management Program – HVC management and monitoring plan has not been available.

NC Mill The company has to provide HVC management and monitoring plan.

Before stage-2

The HCV Identification Report Document has explained actions to protect the rare species, for instance; 1. The making of warning

board about the species conservation.

2. The socialization about the species conservation to all employees and residents around the area.


2010.18 5.2.5 Trained Officers – The company has assigned special officers to manage HCV area, however there was not enough evidence that the officers have been trained based on their function.

NC Mill The company must show the evidence that the special officers assigned to manage HCV area have been trained based on their function.

Before stage-2

The Company has assigned special officers to manage and monitor HCV for example ; Mr.Surung Pandiangan (Kijang Estate) based on Senior Estate Manager Letter dated 03 March 2010 who has been trained internally on 28 October 2010 and 26 May 2011.


2010.19 5.4.1 Renewable energy Monitoring – There is not enough record evidence of the use of renewable energy (energy per ton FFB or energy per ton oil palm product) and the efficiency analysis.

NC Mill The company must show the record evidence of the use of renewable energy (energy per ton FFB or energy per ton oil palm product) and the efficiency

Before stage-2

There is monitoring record of the use of fiber and shell in Fiber and Shell Production Data Unit KJGM year 2006 until May 2011.



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analysis.

There was also efficiency analysis record evidence of the use of fiber and shell fuel as power plant sources compared to the use of diesel fuel for power plant generator.

2010.20 5.4.2 Fossil fuel use Monitoring – There was not enough monitoring record evidence of fossil fuel use and the efficiency analysis.

NC Mill The company must show the monitoring record evidence of fossil fuel use and the efficiency analysis.

Before stage-2

There was monitoring record of fossil fuel use (diesel fuel) in form of the use of diesel fuel for generator during January – June 2011 period; the use average every month was 4,480.8 Liter; allocation per month was 5,054 L; the company explained that the use of diesel fuel was not over the budget because the use of boiler and turbine was very optimal; boiler fuel needed to move the turbine was always available so that the generator use was only needed for starting the initial process in the mill.



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2010.21 6.1.1 Social impact analysis document – There was social impact analysis document besides EIA (Environmental Impact Assessment) document. It was SIA (Social Impact Analysis) document of PT Buana Wira Lestari Mas which covered positive and negative impacts. However, the document content still has minuses, for instances: document legalization, document supporting data, involvement evidence of parties who get the impact, and the competency of document compiling team.

NC Mill and Estate

The company has to revise social impact analysis document by completing the lacks of the document content with these things: document legalization, document supporting data, involvement evidence of parties who get the impact, and the competency of document compiling team, etc.

Before stage-2

There was document of Survey of Social, Economy, Culture Condition and Perception of community surrounding PT Buana Wira Lestari Mas Plantation/Mill in November 2010 compiled by internal company team which had 3 members (Mr. Tomi Hendartomo, Yosaphat Ardhilla R and Nazlya Syahputri) as social impact analysis of the company to the surrounding community (External) whereas internal social impact has been accommodated in RKL-RPL report. The parties who got the impact were involved in assessment compiling process through secondary data sampling, primary data sampling (FGD and respondent data sampling) and assessment result socialization.


2010.22 6.1.2 Social impact management and monitoring plan record – The company has not been able to provide the social impact

NC Mill and Estate

The company must provide the social impact management and monitoring plan periodically

Before stage-2

Based on the interview result with the community leaders of Gerbang Sari Village and Kijang Makmur



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management and monitoring plan with the participation of the community periodically based on the SIA documents of PT Buana Wira Lestari Mas

with the participation of the community

Village and also with the Village Unit Cooperative committee (Berkat Ridlo, Pancamarga and Makarti Buana Jaya Village Unit Cooperative), It was clarified that village community was involved by the company in environment monitoring and management plan compiling through communication/input from village community/Village Unit Cooperative or company’s involvement in Consultative Meeting of the Village Development Plan (Musrenbang-Des)


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3.5.1 Identification of Findings, Corrective Action, Observations at Stage-2 Assessment




2011.23 4.7.4 Audiometric Test Examination – The company needs to evaluate and arrange action plan of audiometric test examination result for workers who work at station with the noise intensity over the threshold set by the regulation to make sure of the safety and security of the workers

CFA Mill The company is suggested to provide audiometric test and evaluation result evidence for workers who work at station with the noise intensity over the threshold set by the regulation.

S1 The company has done audiometric test to workers who work at station with the noise intensity over the limit set by the regulation. The company has also evaluated the audiometric test result of 6 workers (2 engine room workers; 4 boiler workers) who were identified suffering from minor deaf. The company has done action plan to the result. Some of the actions were the use of Personal Protection Equipment (PPE), re-examination and if the result was still the same there would be recommendation to transfer to other section.



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2011.24 5.2.2 Protected animal management – Based on the field visit to J 22-23 block (Kijang Estate), evidence of animal hunting was found. The animal hunted was the one identified in HCV document as animal protected by the law (kind of animal: 2 Kingfisher birds). The company has arranged action plan related to that matter. However, there was not enough evidence of protected animal protection action plan has been implemented.

Minor Estate The company has to provide evidence of the action plan that in work area of PT BWL especially Kijang Estate.

S1 August, 10th 2011 The Company has implemented an HCV socializing action plan to employees and the public on July 25th 2011, however the company has not shown the results of evaluation of the effectiveness of the action plan that has been done.

Open (CFA)

2011.25 5.3.3 Hazardous waste management – Based on the field visit, hazardous waste that has not collected in permitted place was still found. For example: chemical material’s used packaging waste in Kijang POM. The company explained that the collection was only temporary before the waste was returned to the supplier. However, the company needs to consider collecting chemical material’s used packaging waste in the permitted place as required by the regulation (Government Regulation no 18 year 1999).

CFA Mill The company is suggested to collect chemical material’s used packaging waste in the permitted place as required by the regulation.

S1 Not applicable during the audit

Open


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2011.26 5.3.3 Hazardous Waste Monitoring Reporting – The company needs to submit hazardous waste monitoring result (for example: chemical material’s used packaging in Kijang POM and pesticide’ used packaging waste in hazardous waste storage in Kijang estate) to the related authorities.

CFA Mill and Estate

It is suggested to provide packaging waste pesticide monitoring result reporting evidence to the related authorities.

S1 Not applicable during the audit

Open


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3.5.3 Identification of Findings, Corrective Action, Observations at Annual Surveillance 1 Assessment



Time Limit

Observation and Date Status Closed date

- - During the second surveillance BWL (Kijang POM scope) has provide good implementation of RSPO standard and there was no non-conformance raised.

- - - - - - -


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3.5.3 Opportunity for Improvement

No Ref.Std Deskripsi/Penjelasan

1 Minor 2.1.4

Companies preferably review the mechanisms evaluate compliance regulations related to the management of oil palm perkebnunan (update relevant regulations).

2 Minor 4.7.2

Companies need to create a mechanism of follow up medical examination carried out in the event of interruption / not normal, for instance, set a time limit follow-up so not too long to make a written request referral to a physician clinic and make further checks to be done.

3 Minor 4.7.3

BWL preferably able to review the hazard identification and risk assessment of all work at the Mill and in the Estate. For example: on Land Application and Solar tank of the results in the form of environmental hazard identification and not the impact on workers.

4 Major 5.2.1

- The Company an opportunity to increase the performance of the management of conservation areas to create a more systematic and measurable, such as one timeline, activity description, constraints, and resource requirements etc..

- The company should be able to expand planting perennials for the entire river border that are at work in the plantation area.

5 Major 5.3.1

Major 5.3.2

Companies an opportunity to increase waste management performance by including the estimated total volume of waste generated and categories of waste (or non-hazardous and hardous materials).

6 Minor 5.3.1

BWL should ensure that the optimization process has removed the packing properties of Hazardous on former chemicals through laboratory testing in accordance with Regulation 18 jo. 85 of 1999 articles 7 and 8 of B3 Waste Management.

7 Minor 6.1.1

BWL an opportunity to increase performance management and monitoring of the social impact of the plan and more systematic monitoring. For example: create a timeline, targets, constraints and resource requirements.

8 SC 4.1 6.1

KJGM preferably able to inform the buyer in the sale document CPO / PKO / PK that the resulting product is RSPO certified products since January 20, 2012.


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3.5.4

Noteworthy Positive Components

No Ref Std

Deskripsi

1 Kriteria 4.7

KJGM have been certified Gold Flag of OHS since May 4, 2010.

2 Minor 6.5.1

The company has been providing public facility such as a Smart House is a program of the United Indonesia Cabinet Wives Solidarity Volume II, chaired by First Lady Ani Yudhoyono (First Lady) and in cooperation with PT. SMART, Tbk. Smart House is a non-formal educational facility devoted to children and mothers in the plantation and the surrounding the estates.

3 Minor 6.1.4

Relationships and special attention given to the farmers by the change very well. This is evidenced by placing an assistant and foreman for each KUD, fertilizer loans without interest, savings replanting, competency enhancement training farmers etc.

4 Kriteria 8.1

Have been certified ISCC (International Sustainability and Carbon Certification) since February 3, 2012 by GUTCert.


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

Public Issues Organization Response Auditor Response

Kampar Environmental Agency (Mr. H.M Itarius, Head of Controller)

In general, We considered that RJP and BWL have complied with the provisions of the protection of environmental management in terms of the completeness of the documents such as EIA, wastewater discharge permits, waste discharge permit B3.

In relation to reporting, the company also considered quite docile in terms of sending regular reports monitoring and environmental management in the form of RKL / RPL, wastewater management reports, reports of B3 waste management, etc.

In addition to the report, we routinely monitoring. Based on the monitoring results, there is no conflict or disagreement among community with the company.

Other positive aspects of the company is a cooperative attitude to implementing of our direction. The company always to actively communicate the problems faced.

With these positive notes, the company is still considered worthy of RSPO certified environmental aspects.

RJP and BWL always strive to comply the environmental regulations that apply in the local area. Commitments that have been demonstrated is expected to be maintained in the future.

Based on the observation of the documents and field visits, the audit team assessed the company has consistently implemented environmental management quite well.

Kampar Labor Agency (Mr. Irwan S.M.H.K, Head of Industrial Relations) In general, we assess the performance of the company quite well in terms of employment. Referring to the provisions of Act 13 of 2003, the company has complied with the applicable regulations, such as in the form of: - The minimum wage is in conformity with the provisions

of the UMP. UMP in 2012 was IDR. 1,345,000,- and for 2013 is IDR 1,490,000,-

Companies view employee is an asset to be one of the motor company's success. Therefore, BWL and RJP apply the standard of work and remuneration as well as the Occupational Health and Safety (OHS) according regulations. Achievement is currently a whip to do better in the future so that the relationship with the worker still running mutual and harmonious.

Based on observations document and interviews with the worker known company has been giving facilities to its workers decent enough. For example: Wages are adjusted by setting the Governor of Riau, housing, clean water, lighting and other premiums.


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- Reporting regularly P2K3 implementation in the company. Reports for the period July to September are generally acceptable and in accordance with the contents of the systematics and content is governed by labor laws.

- Accident Reports has submitted periodically - Do not employ child labor - Daily employees who work for 3 (three) months have

been appointed as permanent employees. - Operators of production equipment has a certificate,

there are even plans to train helpers to have a certificate.

- The company has been quite obedient in the provision of personal protective equipment although sometimes ignore labor for a reason. Department of Labor advised even if the necessary disciplinary sanctions can be imposed for employees who do not comply with PPE.

Supervision of the Department of Labor, to date there are no reports or findings regarding the dispute between the company and its workforce. With these positive notes, the company is still considered worthy of RSPO certified aspect of employment.

Kampar Plantation Agency (Mr. Nusyirwan; Head of Plantation Unit) In general, from the point of view of the Plantation Office no significant negative note from RJP and BWL, on the contrary, many of the positive aspects of the implementation of the plantation by RJP and BWL from side to improve the welfare of the people. When compared with some other neighboring companies, Sinar Mas Group's performance is

The existence of the company is also expected to raises benefits for the surrounding community. RJP and BWL regularly sends reports to the Plantation Office. The achievement now will be a benchmark in order to do a better job in the future.

Based on the observation document is known that the company has consistently tried to comply with all applicable regulations in the management of oil palm plantations. Such as: do reporting Developing plantation (LPUP), FFB pricing etc.


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much better. Not a few farmers from around the company that wants to plasma Sinar Mas. Supervision plantation carried out by the Provincial Government with the support of the Plantation Office District. This includes setting FFB is facilitated by the Provincial Government every week. In a meeting FFB pricing were representatives of the District Department of Plantations, companies, and communities. Reports plantation business (LPUP) routinely submitted to the Department of Plantations. From the Plantation Office records note that the report for the first half has been submitted. Systematics and the contents of the report are in accordance with applicable regulations.

Kayu Aro Village (Mr. Gunawan; Head of Village) For the communities, the existence of the RJP is helpful to improve the welfare significantly. Some progress is evident with the pattern of the company's work is transparent. When compared to other companies operating in Kampar, including Sinar Mas best. Some of the benefits of society: - FFB price is guaranteed - Provision of fertilizer more secure from fraud and error

selection - The Convenient supplying fertilizers and medicines with

no-interest loans - Program funds replanting preparation - Corporate social responsibility for the village in various

aspects such as: educational, religious, youth, street repairs, etc.

- Technical guidance in the form of provision of Assistant

Partnership through the core-plasma provides valuable lessons in engaging the community in the core business that is being run by the company. Programs that apply to farmers plasma is an indirect education on how to run this business. Expected relationships with smallholders to remain harmonious and mutually support each other.

Based on the observation of documents and visits to the field, it is known that the company has made the management of oil palm smallholder’s pattern very well. The relationship between the company and farmers established harmony. .


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Foreman with skill and good enough to ensure the plantation by KUD going well according agronomic principles, as in the case of: fertilizer, crop rotation, fertilizers rotation, treatments, etc.

- The development of cooperation also on employment opportunities for the surrounding community.

Until now, We noted there are not complaints from the public, both in terms of environmental damage due to the relatively remote location of the MCC Ramarama atauapun other losses. The problems that happened can usually be resolved quickly because of Communications intense every day, either directly or through officers to the leadership of the company in the KUD. So far there are no barriers in terms of communication. In itself there is a mechanism in KUD monthly meetings between farmer groups with KUD officials to discuss various issues. At the meeting the ever-present corporate officer stationed at KUD. Society did not mind if the companies get RSPO certificate because of the aspect of community development has proven successful.


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4.0 CERTIFIED ORGANISATION'S ACKNOWLEDGEMENT OF INTERNAL RESPONSIBILITY

4.1 Formal sign-off of assessment findings

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

Signed on behalf of:

PT. RAMAJAYA PRAMUKTI

MUTUAGUNG LESTARI

Head of Environmental Departement

Lead Auditor

Ismu Zulfikar

Octo HPN Nainggolan

Thursday, November, 08th, 2012

Thursday, November, 08th, 2012


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

No Institution/Department Address Phone/Email Form of Contact

Date of Contact

1 Environmental Agency, District of Kampar

Bangkinang - Interview

05-Nop-2012

2 Manpower Agency, District of Kampar


05-Nop-2012

3 Plantation Agency, District of Kampar


05-Nop-2012


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Annex 2. Audit Plan

DATE 05 - 09 November 2012

PLANNED TIME

ACTUAL DURATION

PROCESSES / CLAUSES TO BE AUDITED AUDITOR

05.11.2012 08.00-17.00

08.00-17.00

Document Review / Observation : Verification of Main Assessment / Observation :

All Team

06.11.2012 08.00-12.00

14.00-17.00

08.00-12.00

14.00-17.00

Field Observations to the PT Buana Wiralestari (Nagasakti POM) weighting of fresh fruit bunch (FFB), grading areas, loading ramp, sterilizer, clarifier, pressing areas, boilers, CPO storage, drainages, safety (EPR), liquid waste pond, workshop, and warehouse; Supply Chain Implementation. Continued for field observations (Interview with local villagers)

All Team

07.11.2012 08.00-12.00

14.00-17.00

08.00-12.00

14.00-17.00

Field Observations (Nagamas Estate) Nursery, Land Preparation, manuring, spraying, harvesting, FFB Transportation, land application. Clarification of findings

All Team

08.11.2012 08.00-12.00

14.00-17.00

08.00-12.00

14.00-17.00

Field Observations (Nagasakti Estate) Nursery, Land Preparation, manuring, spraying, harvesting, FFB Transportation, land application. Clarification of findings

All Team

09.11.2012

08.00-10.00 10.00-12.00

08.00-10.00 10.00-12.00

Preparing Closing Meeting Closing Meeting

All Team

Noted: - Lunch and pray conducted at 12.00 – 14.00 pm - Consultation public with the relevant agency in the Kampar District conducted together with PT. BWL at November, 05th 2012 - Closing Meeting conducted together with PT. Ramajaya Pramukti on November, 09th 2012.


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Annex 3. Glossary

AAA : Agronomy Audit and Advisory

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

APD / PPE : Alat Pelindung Diri (Personal Protection Equipment)

ASEAN : Association of South East Asian Nations

AVP : Assisstant Vice President

B3 : Bahan Beracun dan Berbahaya (Hazardous Material Waste)

BWL : Buana Wiralestari Mas

BOD : Biological Oxygen Demand

CEO : Chief Executive Officer

CFA : Comment For Action

CPO : Crude Palm Oil

CBD : Convention on Biodiversity

ENDV : Environment Division

HCV : High Conservation Value

HGU : Hak Guna Usaha. (Land Use Permit)

ISBPR / HIRARC :

Identifikasi Sumber Bahaya, Penilaian, dan Pengendalian Resiko / Hazard Identification Risk Assessment and Risk Control

IUP : Izin Usaha Perkebunan. (Plantation Operation Licence)

IP : Identity Preserved

IPAL / WWTP : Instalasi Penyaluran Air Limbah / Waste Water Treatment Plant

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

Jankos / EFB : Janjangan Kosong / Empty Fruit Bunch

K3 / OHS : Keselamatan dan Kesehatan Kerja / Occupational Health and safety

KJGE : Kijang Estate

KJGM : Kijang Mill

KER : Kernel Extarction Rate

LC : Land Clearing

MAA : Mill Audit Advisory

MB : Mass Balance

NC : Non Comformance

OIA : Operations Internal Audit

OER : Oil Extarction Rate

P2K3 :

Panitia Pembina Keselamatan dan Kesehatan Kerja (Occupational Safety and Health Committee)

PC : Production Controller

PHT / IPM : Pengendalian Hama Terpadu / Integrated Pest Management

PK : Palm Kernel

PKS / POM : Pabrik Kelapa Sawit / Palm Oil Mill

PSM : Perkebunan Sinarmas

RJP : Ramajaya Pramukti

RC : Region Controller

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

ASA-01 : Surveillance 1

SMARTRI : Smart Reseach Institute


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SOP : Standard Operational and Procedure

ST1 : Stage 1

ST2 : Stage 2

TBS / FFB : Tandan Buah Segar / Fresh Fruit Bunches

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

VPA : Vice President Agronomy

VPM : Vice President Manufacture

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