PT MSS_Public Summary Report.rev4 - Wilmar International

Roundtable on Sustainable Palm Oil Public Summary Report

Report no.: 82450216035

Certification assessment against the

RSPO Principles & Criteria 2013 (Generic) and

RSPO Supply Chain Certification Standard 2014

PT Murini Sam-Sam (Subsidiary of Wilmar International Group)

Bengkalis, Riau, Indonesia

Date of assessment: 3 – 6 November 2015

Report prepared by: Carol Ng Siew Theng

(RSPO Lead Auditor)

Certification decision by:

Abdul Qohar (Director of PT TUV Rheinland Indonesia)

Certification Body: PT TUV Rheinland Indonesia

Menara Karya, 10th Floor Jl. H.R. Rasuna Said Block X-5 Kav.1-2

Jakarta 12950,Indonesia Tel: +62 21 57944579 Fax: +62 21 57944575

www.tuv.com/id

TABLE OF CONTENTS

1.0 SCOPE OF CERTIFICATION ASSESSMENT 3

1.1 National Interpretation Used 3

1.2 Type and Scope of Assessment 3

1.3 Location and Maps 3

1.4 Description of Supply Base 4

1.5 Dates of Plantings and Replanting Cycles 7

1.6 Other Achievements and Certifications Held 7

1.7 Area of Plantation (Total, Planted and Mature) 8

1.8 Organisational Information / Contact Person 8

1.9 Description of Company History, Socioeconomy & Environment 8

1.10 Time Bound Plan for Other Management Units 10

1.11 Compliance to Rules for Partial Certification 11

1.12 Plan for certification of associated smallholders 13

1.13 Approximate Tonnages Certified 13

1.14 Recommendation for Certification 13

1.15 Date of Certificate Issued and Scope of Certificate 13

2.0 ASSESSMENT PROCESS 14

2.1 Certification Body 14

2.2 Qualifications of Lead Assessor and Assessment Team 14

2.3 Assessment Methodology 15

2.4 Stakeholder Consultation and Stakeholders Contacted 16

2.5 Date of Next Surveillance Visit 17

3.0 ASSESSMENT FINDINGS 17

3.1 Summary of Findings 17

3.2 Identified Non-conformances, Corrective Actions Taken and Auditors Conclusions 50

3.3 Noteworthy Positive Components 51

3.4 Issues Raised by Stakeholders and Findings Pertaining to Issues 51

3.5 Acknowledgements of Internal Responsibility and Formal Sign-Off by Client 56

APPENDICES 57

Appendix 1: Details of Certificate 57

Appendix 2: Certification Audit Plan 59

Appendix 3: List of Abbreviations 63

Appendix 4: List of Stakeholders Interviewed and Contacted 64

Appendix 5: Observations and Opportunities for Improvement 65

RSPO Certification Assessment Report

PT Murini Sam-Sam (Wilmar International Group)


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QMF: RSPO-007a-13(Rev.0)

1.0 SCOPE OF CERTIFICATION ASSESSMENT

1.1 National Interpretation Used

The operations of the palm oil mill(s) and its supply base of FFB were assessed against generic RSPO Princi-ples & Criteria (P&C) year 2013 and the RSPO Supply Chain Certification Standard (SCCS) year 2014. The company has opted to be certified against SCCS requirements Module E for CPO Mills: Mass Balance.

1.2 Type and Scope of Assessment

The main certification assessment was carried out on 1 mill and 1 estate under PT Murini Sam-Sam (PT MSS), which is a subsidiary of Wilmar International Group.

Although the Estate Business Permit (‘Izin Usaha PerEstatean’ or IUP) of the estate dated 14 August 2004 has been approved for 1233.13 ha, the company has yet to receive the approved HGU for 466 ha of area planted in year 1991 due to ongoing planning process of Provincial Spatial Plan (Rencana Tata Ruang Wilayah Propinsi – RTRWP) area by the local authorities. Hence, this 466 ha (henceforth referred to as the ‘non-HGU’ area) will not be included in the scope of certification until the HGU of this area has been approved and the company has applied for the new IUP and new Environmental Management/Monitoring Efforts documents (‘Usaha Pengel-olaan Lingkungan/ Usaha Pemantauan Lingkungan’ or UPL/UKL) for this area. The current estate area includ-ed in the certification scope is 967 ha. Further details are as described under Section 1.9 of this report.

1.3 Location and Maps

Table 1: GPS locations for all estates and mills in cluded in certification assessment

Name of mill / estate

Location GPS locations

Latitude Longitude

PT Murini Sam Sam Palm Oil Mill

Pangkalan Libut Village, Pinggir Sub-district, Bengka-lis District, Riau Province, Indonesia.

1°3'37.27" 101°14' 21.92"

PT Murini Sam Sam Estate

Jl. Lintas Pekanbaru-Duri, KM 92.8, Pangkalan Libut Village, Pinggir Sub-district, Bengkalis District,Riau Province, Indonesia.

1°3' 48.34"

101°14' 41.08"




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Figure 1: Location of PT Murini Sam Sam in Indonesi a

Location of PT. MSS




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Figure 2: GIS map of PT Murini Sam Sam Estate (Scal e: 1:75,000) with close-up of estate boundary.

Yellow region is the HGU area (certified) and gree n region is the non-HGU area (not yet certified)

Estate coord inates

HGU area

Non-HGU area




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1.4 Description of Supply Base

Table 2: FFB Supply Information for PT Murini Sam- Sam in year 2014 and in year 2015

FFB Contributors FFB supplied in year 2014

FFB supplied in year 2015

Tonnes % Tonnes %

Company owned estates:

PT Murini Sam Sam estate (HGU area)

22,225 8.01 25,983 7.03

PT MSS Estate Non-HGU area 10,908 3.93 12,594 3.40

Subtotal (estate) 33,133 11.94 38,577 10.43

Independant outgrowers 244,441.35 88.06 331,294 89.57

TOTAL 277,574.345 100 369,871 100

Table 3: Certified tonnages claimed, certified tonn ages purchased or sold, total and projected CPO and PK production from PT Murini Sam-Sam Palm Oil Mill

* From company-owned estate with approved HGU only ** Calculated based on assumption that 7.03% of crop received is from the certified area of the estate, as per the FFB supply history in year 2015 in Table 3.

Amount (MT)

FFB CPO PK

Certified tonnages claimed - 6,435 1,778

Certified tonnages sold - 0 0

Certified tonnages purchased - 0 0

Total Actual Production for year 2015 369,871 68,980 19,011

Actual Certified Production for year 2015* 25,983 4,846 1,336 Conversion Rate for year 2015 - OER: 18.65% KER: 5.14%

Projected output for year 2016 382,325 72,451 20,072

Projected Certified Production for year 2016**

26,877 5,093 1,411

Projected conversion rate for year 2015** - OER: 18.95% KER: 5.25%




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1.5 Dates of Plantings and Replanting Cycles The company follows a replanting cycle of 25 years, however the actual replanting cycle may be increased de-pending on the actual productivity of the crop. Information on the dates of plantings are as per the table below. Table 4: Age and year of plantings of company estat e supplying to PT Murini Sam-Sam

Age & Year of Plantings Oil palm planted area at PT

Murini Sam (ha)

1993 (22 years old) 177.2

1995 (20 years old) 628.33

1996 (19 years old) 44.78

TOTAL 850.31 *Note: The company had also planted 438.79 ha of oil palm within the non-HGU area. Since the company has not obtained the Land Use Rights certificate (HGU) for this area yet, this is removed from the table until it is confirmed to be included in the certifica-tion scope.

Table 5: Planned and actual oil palm replanting act ivities for PT Murini Sam-Sam

There has been no replanting carried out since the establishment of the estate in year 1999. The company plans to carry out their first round of replanting in year 2018 for total of 330.22 ha for year 1993 planted area.

Year Total planned replanting area for PT MSS estate

Actual total area replanted (ha)

2016 - -

2017 - -

2018 330.22* -

2019 - -

2010 - - *Note: This does not include planned replanting area for the non-HGU area, in which 250.08 ha of year 1991 plantings is also planned for replanting, hence total planned replanting area including non-HGU area is 529.53ha.

1.6 Other Achievements and Certifications Held

Table 6: Details of other certifications or awards held by PT Murini Sam-Sam Name of mill /

estate Certification Standard / Award achieved

Certification Body / Awarder

Date Achieved

PT Murini Sam-Sam Es-tate

Zero Accident Award for achieving 1,415,744 working hours without any accidents, calculated since 1 January 2012 until 31 December 2014

Manpower Depart-ment of the Republic of Indonesia

31 August 2015

PT Murini Sam-Sam Palm Oil Mill

Performance Rating Program in Environmental Management (PROPER) Level: Blue

Ministry of Environ-ment and Forestry

For period of 2013-2014

PT Murini Sam-Sam Palm Oil Mill

CSR Best Practice for MDG’s in Conjunction with Indonesia Development Goals Category: Silver for increasing the age of chil-dren participating in year 9 education through the ‘Wilmar Education Partnership Program’

Coordinating Minis-ter for People's Wel-fare, Republic of In-donesia

15 September 2011




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1.7 Area of Plantation (Total, Planted and Mature)

Table 7: Oil Palm Planted Area Summary, FFB Product ion and Average yield/ha for PT Murini Sam Sam in year 2014

Estate Name Total area

(ha)

Oil Palm Planted area

(ha)

Mature (Production)

area (ha)

Immature (Non-production)

area (ha)

FFB Production*

(tonnes)

Average yield/ ha

PT Murini Sam-Sam

967.00 850.31 850.31 - 22,227 26.14

Table 8: Land use data for PT Murini Sam-Sam

Estate Name Total area (ha)

Oil Palm Planted

Area (ha)

HCV/

Potential HCV areas*

(ha)

Land used for other purposes (ha)

Non-plantable area

Palm Oil Mill

Road, Housing & Drainage

PT Murini Sam-Sam (HGU area)

967.00 850.31 52.92 8.95 19.12 35.70

Not included i n current certification scope (for reference only): Non-HGU area 466.00 438.79 0.86 1.30 - 25.05

Total 1,433.00 1,289.10 53.78 10.25 19.12 60.75

1.8 Organisational Information / Contact Person

Contacts details of the company are as follows:

1.9 Description of Company History, Socio-economy & Environment As stated under Section 1.2 of this report, the company has an Estate Business Permit (‘Izin Usaha PerEstate-an’ or IUP) of the estate dated 14 August 2004 has been approved for 1233.13 ha. However, the company has yet to receive the approved HGU for 466 ha of area planted in year 1991 due to ongoing planning process of RTRWP area by the local authorities. Some of this land area of 466 ha was also not included in the original IUP area of 1233.13 ha. The entire 466ha of land was previously planted with oil palm by local communities, and upon establishment of the plantation in year 1991, the company took over the land, paid compensation to the affected local community members owning plots of land within this 466ha of land and from then on these areas were under the company’s management. The approval process for this 466ha, and once approved, the compa-ny will apply to conduct a new IUP and new Environmental Management/Monitoring Efforts documents (‘Usaha Pengelolaan Lingkungan/ Usaha Pemantauan Lingkungan’ or UPL/UKL) for this area, hence the total land area will be revised and increased from the previous area of 1233.13 ha approved in the existing IUP. This 466 ha will not be included in the scope of certification until the HGU of this area has been approved and the company has obtained a new IUP and prepared a new UPL/UKL set of documents for the estate. The current estate area included in the certification scope is 967 ha.

Company Name: PT Murini Sam Sam (subsidiary of Wilm ar International Group)

RSPO Membership no. 2-0017-05-000-00

Address: Site: Jl. Lintas Pekanbaru-Duri, KM 92.8, Pangkalan Libut Village, Pinggir Sub-district, Bengkalis District,Riau Province, Indonesia.

Office: Jl. Soekarno–Hatta, Komplek Sentral Komersial Arengka (SKA) Blok F79–F80, Pekanbaru – Riau 28294, Indonesia

Contact Person: Mr. Priadi

Telephone: +62 813 74813864

Email: [email protected]




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Table 9: General Information on PT Murini Sam-Sam e state

No. Description Estate Reference Source

1 Surrounding stakeholders (at estate boundaries) North - High

Conservation Value Report – Re.Mark Asia 2014

East Pangkalan Libut Village South - West Sungai Meranti Village

2. Total Area (ha) 1233.13 ha (including 466ha of non-HGU area) 3. Hydrology Main river bordering with estate: Mandau River

River tribunary located within the estate: Meranti River Estate experiences periodic flooding areas

4. Geology Sandstones, shales and sub-recent riverine alluvium. Northern parts more dissected compared to the rest

Soils of PT MSS Estate – Param Agricultural Soil Surveys (M) Sdn. Bhd. (May 2008)

5. Soil type 10 soil mapping units identified and grouped into 4 soil man-agement groups as follows: Soil Man-agement

Group

Soil Map Units*

Main Characteristic/ Limita-tion

Extent

Ha %

A Bgr/2 Bgr/3 Bgr/4

Deep fine sandy clay tex-tured soils. Soil erosion on steper slopes. Low fertility.

49.1 4.0

B Sdg/2 Rsu/2 Nka/1

Deep well-drained soils. Texture loamy. Moisture stress and yield fluctua-tions. Soil erosion on steeper slopes. Low fertility

1,036.4 84.4%

C Btu/1 Lus/1

Poor drainage and flooding 110.5 9.0%

D Erg/sh/1 Erg/m/1

Moderately deep tp shallow organic soils. Subsidence on drainage. Leaning palms. Termite activity.

7.4 0.6%

*Note: Bgr = Bungor soil series Sdg = Serdang soil series Rsu = Rasau soil series Nka = Nangka soil series

Btu = Bukit Tuku soil series Lus = Lunas soil series Erg = Erong soil series

6. Climate Tropical with annual rainfall of 1,780 – 2,417mm per annum 7. Topography Level to hilly terrain; Slope: 0-35%+ or 0-20°+ 8. Elevation 10 – 50m (150 feet)




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1.10 Time Bound Plan for Other Management Units The time frame laid out below is considered to be both challenging and realistic. The audit team is satisfied that the company conforms with the RSPO requirements for partial certification as laid out in Clause 4.2.4 of the RSPO Certification Systems document. Table 10: Time Bound Plan of the Other Management U nits under Wilmar International Group

Name of Holding Location Time bound

plan for certific ation

Status

Indonesia

PT Milano (Pinang Awan) North Sumatra 2009 Certified

PT Mustika Sembuluh I Central Kalimantan 2009 Certified

PT Kencana Sawit Indonesia West Sumatra. 2010 Certified

PT Kerry Sawit Indonesia I Central Kalimantan 2010 Certified

PT Tania Selatan South Sumatra 2010 Certified

PT AMP Plantation West Sumatra 2011 Certified

PT Agro Nusa Investama (Sambas) West Kalimantan 2012 Certified

PT Buluh Cawang Plantations 1 South Sumatra 2012 Certified

PT Bumi Sawit Kencana Central Kalimantan 2012 Certified

PT Gersindo Minang Plantations West Sumatra 2012 Certified

PT Sarana Titian Permata Central Kalimantan 2012 Certified

PT Daya Labuhan Indah-2 North Sumatra 2013 Certified

PT Mustika Sembuluh 2 Central Kalimantan 2014 Certified

PT Mentaya Sawit Mas Central Kalimantan 2014 Certified

PT Kerry Sawit Indonesia 2 Central Kalimantan 2014 Certified

PT Agro Palindo Sakti 1 South Sumatra 2014 Certified

PT Rimba Harapan Sakti Central Kalimantan 2016 Certified

PT Buluh Cawang Plantation West Kalimantan 2015 Certified

PT Sinarsiak Dianpermai Riau 2014 Gap Assesment on 19/09/2014

PT Musi Banyuasin Indah South Sumatra 2014 Full Assessment on 28/11/2014

PT Karunia Kencana Permaisejati Central Kalimantan 2016 Full Assessment on 09/04/2015

PT Murini Sam Sam Riau 2014 Full Assessment on 02/11/2015

PT. Bumi Pratama Khatulistiwa West Kalimantan 2016 Planned

PT. Agro Nusa Investama (Landak) West Kalimantan 2016 Planned

PT. Agro Palindo Sakti 2 West Kalimantan 2016 Planned

PT. Agrindo Indah Persada 2 Bangko - Jambi 2016 Planned

PT. Putra Indotropical West Kalimantan 2016 Planned

PT. Pratama Prosentindo West Kalimantan 2016 Planned

PT. Indoresin Putra Mandiri West Kalimantan 2016 Planned PT. Asiatic Persada Jambi 2013 Not classified, com-

pany sold PT. Citra Riau Sarana 1 Riau 2014 Not classified, shares

are being divested PT Citra Riau Sarana (ML) 3 Riau 2014 Not classified, shares

are being divested




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PT Citra Riau Sarana 2 Riau 2014 Not classified, shares are being divested

Malaysia

Sapi Palm Oil Mill Labuk, Sandakan Sabah

2015 Certified

Reka Halus Palm Oil Mill Labuk, Sandakan Sabah

2015 Certified

Sabahmas Palm Oil Mill Lahad Datu, Sabah 2015 Certified

Saremas 1 Palm Oil Mill Miri, Sarawak 2015 Certified

Saremas 2 Palm Oil Mill Miri, Sarawak 2015 Certified

Terusan Palm Oil Mill Labuk, Sandakan Sabah

2015 Certified

Ribubonus Palm Oil Mill Telupid, Sandakan, Sabah

2015 Certified

Sri Kamusan Palm Oil Mill Sugut, Sandakan Sabah

2015 Certified

Table 11: New Development Area under Wilmar Interna tional

Name of Holding Location Total area NPP Status according to

RSPO NPP procedure

PT Agro Indah Persada Merangin. Jambi 1,200 ha Approved

PT Agro Nusa Investama Sambas Sambas, West Ka-

limantan 1,024 ha Approved

Biase Plantations (Ibiae Estate) Calabar, Nigeria 5594 ha Approved

Biase Plantations (Calaro Extension) Calabar, Nigeria 3066 ha Not submitted (Pending

HCV/HCS study

Eiyup Industry (Oban Estate) Calabar, Nigeria 2986 ha Not submitted (Pending HCV/HCS study

Biase Plantations (Biase estate) Calabar, Nigeria 8029 ha Overlapping boundaries

1.11 Compliance to Rules for Partial Certification

Compliance of the uncertified management units of Wilmar Plantation Limited against the rules for partial certifi-cation according to RSPO Certification System clause 4.2.4 was assessed through document check for all com-pany’s self assessment report for uncertified unit. A summary of findings is as stated below.

Partial Certification Re-quirements

Audit Findings

(a) The parent organization or one of its majority owned and / or managed subsid-iaries is a member of RSPO.

Wilmar International Indonesia is RSPO member with member-ship number 2-0017-05-000-00.

(b-d) A challenging time-bound plan for certifying all its relevant entities is submit-ted to the Certification Body (CB) during the first certification audit. The time-bound plan should contain a list of sub-sidiaries, estates and mills.

Any revision to the time-bound plan or to the circumstances of the company shall cause the plan to be reviewed. for whether it is still appropriate, such that changes to the time-bound plan are per-

Refer to the time bound plan under Section 1.10 above




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Audit Findings

mitted only where the organisation can demonstrate that they are justified

(e) No replacement of primary forest or any area identified as containing High Conservation Values (HCVs) or required to maintain or enhance HCVs in accord-ance with RSPO criterion 7.3. Any new plantings since January 1st 2010 must comply with the RSPO New Plantings Procedure

There are some newly developed plantation areas under Wilmar International such as in Jambi province, West Kalimantan prov-ince Indonesia and Nigeria as explained on the table 11 above. Some areas have undergone the New Planting Procedure (NPP) and been approved while some areas are still undergoing the NPP, as shown in Table 11 above.

(f) Land conflicts, if any, are being re-solved through a mutually agreed pro-cess, e.g. RSPO Grievance procedure or Dispute Settlement Facility, in accord-ance with RSPO criteria 6.4, 7.5 and 7.6.

Wilmar International carried out the New Planting Procedure for BIASE Plantation Limited (Ibiae estate) in Nigeria with an an-nouncement made on the RSPO website on 9 November 2012. During this NPP process, a complaint was submitted by the Rainforest Resource & Development Centre (RRDC) on behalf of the Ibiae Land Lord Community. The complaint covered in-fringements to several aspects of Principle 1 and Principle 2 of the RSPO P&C. The case was taken up and investigated by the RSPO Complaints Panel, with decision made for RSPO to a law-yer well acquainted with Nigerian laws to review and give an au-thoritative opinion on whether the company had complied with the legal requirements of Nigeria. The legal opinion was received by the RSPO on 27 August 2014, and based on this opinion, the RSPO confirmed that BIASE Plantations was in compliance with legal requirements and closed the case. However, the result was not accepted by RRDC as well as the NGO, Friends of the Earth and the issue remains ongoing with no resolution. As the com-pany has complied with requirements to attempt to resolve the dispute through the RSPO grievance procedure, this is noted by the TUV Rheinland audit team as an observation and progress of the case will be monitored.

Further details on this case is available here: http://www.rspo.org/members/complaints/status-of-complaints/view/26

There is also on ongoing land dispute at PT Gersindo Minang Plantation (GMP), West Sumatra under Wilmar, which has been ongoing since year 1997 with the village of Jaorang Rantau. This company has been RSPO certified by another certification body who is monitoring the status of the dispute with the RSPO.

(g) Labour disputes, if any, are being re-solved through a mutually agreed pro-cess, in accordance with RSPO criterion 6.3.

A previously ongoing labour conflict in PT Tania Selatan regard-ing employee bonus has been resolved There are no other iden-tified labour disputes ongoing at other subsidiary companies of Wilmar.

(h) Legal non-compliance, if any, are be-ing resolved in accordance with the legal requirements, with reference to RSPO criteria 2.1 and 2.2.

Some of Wilmar’s other management units have not complied with certain legal requirements, for example in PT Sarana Titian Permai, PT Kerry Sawit Indonesia, PT Mustika Sembuluh estate under another Wilmar International management unit, there is an issue with the land area stated in the land use right certificate (HGU). However, the company is taking action by inviting the National Land Agency (BPN) to remeasure the land and resolve the issue. The process is still ongoing.

In addition, there were non-compliances raised in June 2015 by the Environmental Department of Agam against PT AMP Planta-




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Audit Findings

tion, another subsidiary of Wilmar. The non-compliances raised were that:

- The company continued to carry out land application after their license for land application had expired on 14 March 2014

- The company was carrying out POME treatment using an ad-sorption system which had not been studied or approved as per the company’s environmental management document

- There was no follow up by the company’s management on the results of the evaluation by the Agam district on PT AMP mill’s wastewater treatment facility in 2013

- Sample analysis results of wastewater discharged from the mill was found to have exceeded the legal limits for BOD and COD.

At time of this audit, the company was still making efforts to close these legal non-compliances.

1.12 Plan for certification of associated smallhold ers

The mill only received crop from PT Murini Sam Sam estates and from independent third party sources, and has not associated smallholders. Therefore the company does not have any plan for certification of associated smallholders.

1.13 Approximate Tonnages Certified

The approximate tonnages certified, based on projected certified production for year 2016 as described under Table 3, is as follows:

Crude Palm Oil (CPO) : 5,093 MT Palm Kernel (PK) : 1,411 MT

1.14 Approval for Certification PT Murini Sam Sam has established and maintains an effective system to ensure compliance with the RSPO principles and criteria. The audit team has confirmed through the audit process that the company’s practices complies with, adequately maintains and implements the requirements of RSPO Principles and Criteria 2013 (generic) and the RSPO Supply Chain Certification System Standard 2014. The audit team leader recommends to the PT TUV Rheinland accredited office for the certification of PT Murini Sam-Sam as a producer of RSPO Certified Sustainable Palm Oil.

1.15 Date of Certificate Issued and Scope of Certif icate

The scope of the certificate covers production of palm oil from PT Murini Sam-Sam Palm Oil Mill and its supply base, which includes PT Murini Sam-Sam Estate. The date of certificate issued is June 08, 2016. Further de-tails of the certificate are as per Appendix 1.




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2.0 ASSESSMENT PROCESS

2.1 Certification Body PT TUV Rheinland Indonesia is member of Group TÜV Rheinland Group, a global leader in independent test-ing and assessment services. The TÜV Rheinland Group was established in 1872 with offices located in over 500 locations in 65 countries on all five continents. PT TUV Rheinland Indonesia offers certification for a wide range of management systems according to established international standards including ISO 9001, ISO 14001, OHSAS 18001, and SA 8000. PT TUV Rheinland Indonesia’s office is located in Jakarta, Indonesia.

2.2 Qualifications of Lead Assessor and Assessment Team

Name Posi-tion

Qualifications / Experience

Carol Ng Lead

Auditor

Education: B.Sc. Biotechnology & B.Sc. Environmental Management - Monash University.

Trainings attended: RSPO Lead Auditor Course – Wildasia; RSPO Supply Chain Certification Systems training course – David Ogg & Partners; RSPO Malaysian National Interpretation Requirements and Certification – SIRIM; Implementation of RSPO Principles & Criteria - QA Plus; RSPO Stepwise Support Programme - Pro-forest/WildAsia; OHSAS18001:2007 Auditor/Lead Auditor Training – Neville Clarke; ISO14001 Auditor/ Lead Auditor Training – Neville Clarke; SA8000 5 Day Basic Auditor Course – Global Group; Elaborating on the RSPO P&C Social and Labour Standards and the Mechanics of Social Auditing Workshop – Verité; Certification Body Biodiversity Forum & Workshop – RSPO; 2nd Biodiversity Seminar – RSPO; Environmental Quality Act 1974 – Department of Environment.

Working experience: RSPO Lead Auditor (since March 2015), CDM Auditor (since year 2012), Assistant Manager (since year 2012) and Project Engineer (since year 2009) for TUV Rheinland Malaysia; currently responsible for conducting and coordi-nating RSPO certification projects; previous experience in implementing sustainable practices in Sime Darby plantations to comply with RSPO requirements, performing RSPO internal audits and implementing sustainability projects. Prepared training ma-terials and conducted several RSPO requirements trainings and workshops to planta-tion management teams (2008).

Suriadi Ali

Auditor (OSH, Envi-ron-

ment)

Education : Diploma Applied Analitycal Chemistry. North Sumatra University, Medan and Bachelor of Chemical Engineering, University of Jaya Baya, Jakarta. Trainings attended: ISO 9000:2000 Series Auditor / Lead Auditor Training - PE In-ternational (Jakarta), IEMA Advanced EMS Auditor (IEMA / EARA ISO 14001) Audi-tor / Lead Auditor Training Course - PE International (Jakarta), OHSAS 18001 Lead Auditor Training Course - PE International (Jakarta). ISPO lead auditor training. Na-tional Examination Board of Occupational Safety and Health (International General Certification (IGC) 1,2 and 3 TUV Nord (Dubai). National Examination Board of Oc-cupational Safety and Health (International Technical Certification (ITC) for Oil and Gas Industries. RRC (Dubai). Indonesian Engineer Association (PII) (Jakarta), Oc-cupational Health and Safety Specialist for lifting equipments. Indonesia Man Power and Transmigration Department (Jakarta). Working experience: Experienced in Quality Control from 1992-2004. Coordinator for Safety Quality and EnvironmentManagement System since 2002 – present. Audi-tor for Environmental Management System since 2002 – present. Auditor for OHSAS 18001 since 2012 - present. Conducted over 10 Quality Management System audits Environmental Management System audits and OHSAS

Naik Mo-nang

Parlin-dungan

Auditor (Best

practic-es)

Education: Bachelor of Forestry, Gadjah Mada University.Trainings attended: In-donesian Sustainable Palm Oil (ISPO) Auditor, Quality Management System (QMS) Auditor/Lead Auditor (ISO 9001:2008) by IRCA, Environmental Management Sys-tems Auditor/Lead Auditor Conversion Training by IRCA (ISO 14001-2004), and




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Lingga HCVA Training Work experience: Field Assistant PT Sapta Karya Damai (2008-2013), auditor in PT Sucofindo (2013-2015), and Auditor in PT TUV Rheinland Indonesia (2015-present)

Dewi Ak-bari

Auditor (social)

Education: Bachelor of Agriculture, Departement of Social and Economic of Agriculture, Sriwijaya University, Palembang. Trainings attended : RSPO Lead Auditor Training, Pekanbaru (August 2014). Indonesian Sustainable Palm Oil (ISPO) Lead Auditor Training (May 2002); ISO 9001:2008 IRCA Lead Auditor, ISO 14000:2004, OHSAS 18001:2007 trainings -. OHSAS/SMK3 Lead Auditor based on PP No.50 /2012. Working experience: Exprience in consulting, training and auditing Quality, Environmental, OHSAS of PT Surveyor Indonesia Pekanbaru ( 2000 – 2010), Lead Auditor : QMS 9001:2008, Auditor Indonesian Sustainable Palm Oil (ISPO) and Roundtable Sustainable Palm Oil (RSPO) for TUV Rheinland since 2013

2.3 Assessment Methodology The certification assessment was conducted from 3 to 6 November 2015 as per the assessment program be-low. The assessment was carried out in accordance with PT TUV Rheinland Indonesia’s RSPO audit procedure as well as the RSPO Certification Systems document. During assessment, the qualified TUV Rheinland asses-sors used the RSPO standard as endorsed for the country in which the assessment took place and recorded their findings. Due to the location and proximity of the estate to the mill, combined with common management systems, it was possible to carry out both field and document assessments of the estate and mill within the time frame without compromising the integrity of the assessment in anyway. The one mill and one estate were visited and the assessment team carried out field and document assess-ments of compliance to all the RSPO principles and criteria. Common systems were identified and specific evi-dence was recorded for individual estates. Interviews were conducted at the estate and the mill. The company proposed the correction and corrective action for all identified non conformities raised to the cer-tification body 30 days after the closing meeting. Verification of closure of major non-conformances was con-ducted 2 months after the closing meeting of the main assessment and implementation of corrective actions for minor non-conformities will be verified during the next surveillance audit. The certification assessment agenda is as explained below. Main Assessment Agenda

Date Location/ Main sites

Main activities

3/11/2015 PT MSS Palm Oil Mill PT MSS Estate

Stakeholder Consultation Meeting - Introduction to team members - Presentation on RSPO - Open discussion with stakeholders

Opening Meeting

- Introduction to team members - Briefing and finalization of audit plan - Briefing on RSPO audit process - Presentation on estate activities and production data - Presentation on mill activities and production data

Document review: Estate production data, area statements, replanting pro-gramme, review of documents and evidence of compliance to RSPO P&C, evidence of compliance with legal requirements, requests for information, publicly available documents, land conflicts related documents, provision of information, land ownership documents, Social Impact Assessment (SIA), social management, labour related documents, Legal Requirements (OSH & Environment), OSH, Training, SOP’s of Legal requirements register & implementation, Field operations (spraying, harvesting, manuring), fertiliz-




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er application records, chemical application records, chemical stock invento-ry , HIRARC,OSH Committee & safety records, Accident records,Training & PPE issuance, Waste storage also Hazardous waste inventories & manifest Site visit: Murini Samsam Estate Chemical stores,Workshops, Interviews: Head of Murini Samsam Estate, agronomist personal and Man-ager estate, Spraying, Harvesting and Manuring workers, KTU (Head of ad-ministration) , Head of Gender Committee

4/11/2015 PT MSS Estate Site visit: EFB application area, turnera subulata planted area, barn owl boxes, Sei Meranti village, Division offices and field visits, Stake HGU No. 7 on Block 10, Stake HGU No. 8 on Block 10, Stake HGU No. 22 on Block 17, shrub swamp, Meranti River, harvesting and chemist spraying on block 11 (B9) and Block 5 (B4). Document review: Legal requirements register, SOPs for estate, IPM pro-grammes, monitoring records and training records, greenhouse gas identifi-cation and management plan, Palm GHG Summary of greenhouse has cal-culations, internal audit reports, Research & Development visit reports, chemical list, chemical usage records, Code of conduct, Legal Require-ments (Estate and Mill), practices minimize and control erosion and degra-dation of soils, High Conservation Value Interviews; Village heads, community leaders , Sprayers, Manurers, Har-vestors, Head of Murini Samsam Estate, agronomist personnel and Manag-er estate, Spraying, Harvesting and Manuring workers.

5/11/2015 PT MSS Palm Oil Mill

Document Review: SCCS SOPs, organizational chart, Management re-spresentative nomination letter, mass balance sheet templates, training rec-ord, Social Impact Assessment, CSR program records, workers pay slips, insurance records, Social Impact Assessment, CSR program records, work-ers pay slips, insurance records, Code of conduct, Legal Requirements (Es-tate and Mill), efficiency of fossil fuel use and the use of renewable energy is optimized, OHS, Environmental, Issues related to Legal compliance ,Occupational Safety & Health implementation,Training , AMDAL, UPL/UKL, RKL/RPL Aspect Impact Analysis Site visit: Mill tour Interviews: Weighbridge operator, Boiler operators, Engine Room Operator, Head of Mill, staff operation, foreman) and Mill Worker ( operator)

2.4 Stakeholder Consultation and Stakeholders Conta cted The stakeholder consultation involved both external and internal stakeholders. External stakeholders were noti-fied to make comments on the certification assessment by placing an invitation to comment on the RSPO web-site. Stakeholders included those immediately linked with the operation of the company such employees, out-growers, the local government, NGO’s, trade and labour unions and local communities. Stakeholder consultation took place in the form of meetings and interviews. Meetings with stakeholders were held to seek their views on the performance of the company with respect to the sustainability practices outlined in the RSPO Principles & Criteria, and to comment on aspects where improvements could be made. Meetings with local communities were held at their respective premises within and near the company’s area. A stake-holder consultation meeting was also held at the PT Murini Sam Sam Palm Oil Mill on 3 November 2015. Let-ters inviting individual stakeholders to the stakeholder consultation meeting were prepared and sent to the indi-vidual stakeholders, while electronic mail and telephone calls were made to arrange the meetings. In all the interviews and meeting, the objectives of the RSPO and the purpose of the assessment was clarified at the outset followed by an evaluation of the relationship between the stakeholders and the company before discussion proceeded to obtain the stakeholders feedback on the company’s compliance to different aspects of the RSPO Principles & Criteria. Although several stakeholders were not familiar with RSPO but they agreed




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with its objective and expressed their willingness to collaborate in the promotion of sustainable palm oil in North Sumatera province. In all interviews and meetings, the assessment team did not restrict discussion of both the positive and negative aspects of operations conducted by the company’s estate and mill. The stakeholder consultation meeting held with stakeholders during the audit was extensive and productive, with 24 attendees. This was followed by site inspections, including visits to the local communities, interviews with land claimants and contractors, and inspections of worker amenities and infrastructure. All stakeholder is-sues raised were recorded and forwarded to the management for their written reponse, and this is summarized in Section 3.4.The list of stakeholders that attended the stakeholder consultation meeting and stakeholders in-terviewed during the assessment is included as Appendix 4.

2.5 Date of Next Surveillance Visit The next surveillance visit is planned for March 2017.

3.0 ASSESSMENT FINDINGS

3.1 Summary of Findings During the certification assessment, no nonconformities were assigned against Major Compliance indicators while 1 (one) nonconformity was assigned against Minor Compliance Indicators. 14 observations or opportuni-ties for improvement were identified. Further explanation of the non-conformities raised and corrective actions taken by the company are provided in Section 3.2. The observations & opportunities for improvement are listed in Appendix 5. The following is a summary of findings made for the criteria listed in the RSPO Principles & Criteria year 2013

• RSPO Principles & Criteria (P&C)

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

Findings: There was a letter register book named as Logbook (internal and External) showed during audit. All of incoming communication regarding information request were by a written letter and has registered in Mail Logbook. The logbook recorded information according to the sender (stakeholders), date and letter number, type of information request, disposition and responses (directly or by letter with date). There were are some specific information (as mentions on P&C 1.2) requests from stakeholders to the company. Other types of information requests are also registered in the logbook, such as request for contributions or permission to carry out an activity. Records of responses to requests for information from the company are recorded on the log book. The company is using Standard Operating Procedure (SOP) no. PRO-BM-007 issued at August 1st 2015, as the guidance of responding and information request from stakeholders. The company still follows these procedures and showed that they keep to their commitment for transparency. Every information request from stakeholder has responded properly. Stakeholders from local community that has been interviewed during this audit informed that PT MSS is very open to communication. The records of incoming and out-coming letters have been maintained at least 3 years as described by the SOP. Records of requests for information from PT. Murini SamSam in response to Information Requests (form FRM-BM-004) in 2015 were sighted, with some examples as follows : Estate PT Murini SamSam : 1. Letter from Committee development Masque Darul Hikmah Sei Meranti District of Pinggir

No.05/Pan/Mus-DH/SM/I/2015 date January 15th 2015 concerning a request for help for the construction of a mosque.




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2. Letter form SMAN 6 District of Pinggir , No. 420 / SMAN 6 / P / 2015/105 concerning request to bor-row heavy equipment (loader) from PT MSS dated October 26th, 2015

3. Letter from Head of pangkalan Libut Village No. 37/PEM/PKL/X/2015 dated October 2th 2015, concerning request for help as piled land.

PT Murini Samsam Mill: 1. Letter from Head Sector Police Pinggir no B/12/1/2015 dated January 31th 2015 concerning requests for help with electrical poles. 2. Letter from Community Youth Organization Pangkalan Libut Village, no. 03/KTPB/III/IX/2015 dated September 7th 2015 requesting help to provide fresh water. 3. Letter from Head Sei Meranti Village date September 30th 2015 concerning request for help heavy equipment (Grader). Responses to request for information request from the company were sighted as follows: Estate: 1. Letter from PT MSS to Head of High Scool (SMA N 6) District of Pinggir the response letter

regarding the Request Help Heavy Equipment (Loader) No: 081 / KBN-MSS / X / 2015 dated October 27 th 2015 which states that: The company is not able to provide assistance due to damage to heavy equipment

2. Response letter No. 003 / KBN-MASS / I / 2015 concerning the request for assistance for the construction of the Development Committee Masque Darul Hikmah Sei Meranti Village, the Company may request assistance helps the soil piled as many as 50 cars.

3. Available response letter Letter No. 37 / PEM / PKL / X / 2015 dated October 2, 2015 from the Office of the Chief of Base Village Libut Kec. Pinggir regarding: Request assistance to borrow a wheel barrow, in the form of a reply request for help no: 077 / KBN-MSS / X / 2015, and the company stated that they can help the request.

Mill: 1. Available response letter number 003 / EXT / MCC / MSS / II / 2015 to letter number B / 12/1/2015 of Head Police Sector Pinggir dated January 31th 2015 regarding requests for assistance of electrical Pole. The company stated that they can help with this request. 2. Available response Letter no. 005/EXT/PKS/MSS/II/2015for Community Youth Organization Pangkalan Libut Village , No: 03/KTPB/III/IX/2015 date September 7th 2015 , concerning for help fresh water. The company stated that they can help with this request. 3. Available response letter form PT MSS no 004/EXT/PKS/MSS/II/2015 for of Head Sei Meranti Village date September 30th 2015 concerning request for help heavy equipment (Grader). The company stated that they can help with this request. The company has a Records Control Procedures No.PRO-GEN-002 approved by AGM dated October 26, 2013 Objective to ensure records pertaining to quality management systems, environmental, OSH and RSPO identified, stored and maintained safely and secure until a certain period before the docu-ments are authorized to be destroyed. This documents describes the minimum timeframe to maintain documents and records as follows: 1. Quality Management System Documents - 5 years. 2. Administrative document - 5 years, 3. Tax related documents - 10 years, Finance related document - 10 years, instantion 5 years 4. Personnel files and clinical records - 5 years. 5. 3 years for personnel files and clinics after the employee resigns or is no longer employed at PT MSS 6. All CSR records shall be maintained according to the need of the company Compliance status: Full Compliance

Criterion 1.2: Management documents are publicly available, except where this is prevented by commercial confidentiality or where disclosure of information would result in negative environ-mental or social outcomes.

Findings:




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The company has a procedure number PRO-BM-007 Rev 01 dated August 1st 2015 regarding Communication, Consultation and Coordination with stakeholder. The procedure describe how to responds communication, consultation and coordination initiative from stakeholders. This document also describes the method of communication to stakeholders such as: 1. General Information Requests and Company’s Policies. 2. Inputs, Feedback and compaint mechanism regarding the company’s operational impacts. 3. Requests for assistance, Community Development (CD) and Corporate Social Responsibility (CSR) 4. The document is completed with communication process flowchart. This document desribe the kind of documents that could accessed by stakeholders as follows: 1. Company Profile 2. Corporate Policy 3. The organizational structure of Employees 4. Plant operational procedures 5. Plant operational records 6. Report of HCV and HCV Management Plans 7. Company CD Checks and CSR Reports 8. SIA Reports 9. Environment Impact Assessment documents 10. Data on Company Employees 11. Data on use of foreign labor 12. HGU (land use rights) and other licenses and permits Compliance status: Full Compliance

Criterion 1.3: Growers and millers commit to ethical conduct in all business operations and transactions.

Findings: The company does not yet have a policy on ethical conduct prepared in the name of Wilmar Group. The company is currently adopting the policy of PPB Oil Palms Berhad namely a memorandum dated May 13, 2015 signed by the Chairman & MD PPB Oil Palms Berhad. Compliance status: Non-compliance NCR No. 2016-01 of 01 The company does not yet have a policy on ethical conduct prepared in the name of Wilmar Group.

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

Findings: There is evidence of company’s efforts taken to comply with legal requirements and records that the company has submitted required report to local institutions as required. Examples found are as follows: Estate : - Hazardous waste permit for estate dated 24 November 2014 and valid for 5 years, issued by the

‘Board of Investment and Integrated Licensing Services’ - Mandatory Reports to the Social and Manpower of Bengkalis District January 2015, Registration

Number: 070 255 / DKTK / 2015 dated January 22, 2015, the obligation to register again on January 23 2016.

- Report of UKL-UPL first half of 2015 was sent to the Environment Agency (BLH) Bengkalis on 3 Sep-tember 2015, the Agriculture Agency Bengkalis district on 3 September 2015, BLH Riau Province on 27 August 2015.

- Report from the Committee of Occupational Health and Safety (‘Panitia Pembina Keselamatan dan Kesehatan Kerja’/ P2K3) period from April to June 2015, provided proof of receipt by the Office of Manpower District Bengkalis dated August 28, 2015




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- Report P2K3 period from July to September 2015, provided proof of receipt by the Office of Manpower District Bengkalis dated October 1, 2015.

- Report on Fire Monitoring Procedures land and plantation development report (LPUP) the first half of 2015, provided proof of receipt by the Department of Plantation Kab.Bengkalis on 3 September 2015.

- Investment Activity Report of the first half (January - June) 2015 to the Board of Investment and the Regional Licensing Riau Province were sent online and received by the Regional Investment Coordi-nating Board Indragiri Hilir District No. LK84900 report dated July 13th, 2015.

PT Murini Samsam have a procedure which covers a comprehensive list of international, national, sub-national and provincial laws which details the requirements of specific to the mill and estate operations. In the list of regulation and legislation are available list of document distribution to all levels of man-agement of the company. The company conducts audits for compliance to laws and regulations annu-ally. The company also has a copy of the legal requirements for each area is kept by the person in charge of each section. The company has procedures of the identification and evaluation the legal aspects of the legislation that applies with the document number BM-004 PRO-00 revision effective date of 1 November 2013. In the procedure is mentioned personnel who is responsible for the identification and evaluation of laws and regulations, as follows:

• For requirements pertaining to the estate, it is the Community Development or ‘Binamitra’ Manager supported by other departments in the the company's organization

• For requirements pertaining to health, safety and the environment, it is the Environmental, Health & Safety (EHS) department supported by other departments in the the company's or-ganization

• For requirements pertaining to labour, it is the Human Resources Manager supported by other departments in the the company's organization

A relevant section within the law that is identified and linked to activities on PRO-BM-003 Law and reg-ulation compliances, The SOP states that the identification and evaluation is to be carried out at least annualy or when some law and regulation has change where applicable and conducted by the each section, and estate and will be compiled by Legal officer and supported by the Head of Operations / field and other departments within the company organisation. Murini Samsam Estate and Palm Oil Mill maintains and updates their list of all applicable legal requirements relating to environmental, occupa-tional safety and health, the company plantations, and employment as well as records of internal com-pliance checks to legal requirements. Example of latest amendments to the legal requirements register are as follows:

• For labour, there is available minutes of updates and revisions documents of a list the laws, regulation and legislation on 1 April 2015 where in the minutes there is addition of several reg-ulations such as: Act RI No.20 of 1990 about Minimum age is permitted to work, Permenaker-trans No. 07/2013 on the minimum wage

• For environment, there are additions of the latest regulations, i.e. Act 37 of 2014 on the Soil and Water Conservation, Act No.39 of 2014 on Plantations, Indonesian Republic Government Regulation (Peraturan Pemerintah (PP) Republik Indonesia (RI)) no. 101 year 2014 regarding Hazardous Waste Management, Environmental regulation (‘Peraturan Menteri Lingkungan Hidup’ (PermenLH)) No.14 of 2013 regarding Hazardous Waste Symbols and Labels, Regula-tion (‘Undang-undang’ (UU)) RI No.37 tahun 2014 related to Soil and Water Conservation, UU RI No.39 tahun 2014 Plantation

• For health and occupational safety is the addition of the latest regulations: Ministry of Health Decision (‘Keputusan Menteri Kesihatan’ (Kepmenkes)) No.1405 of 2002 about the health re-quirements of office and industrial work environment, Regulation on Minister of Manpower and Transmigration (Peraturan Menteri Tenaga Kerja dan Transmigrasi (Permenakertrans)) No.04 of 1993 on Accident Insurance, and Manpower regulation No.26 year 2014 related to OHS management system.

• For the plantation is the addition of the latest regulations: Government Regulation in Lieu of Law (‘Peraturan Pemerintah Pengganti Undang-Undang’ (Perpu)) 01/2004 revision of Act 41/1999 on Forestry, Act 19/2004 revision of Act No.41 of 1999 on Forestry, Act No. 40 of 2007 on Limited Liability Companies, Act No. 17 of 2012 on Cooperatives, Act No. 39 of 2014 on Plantations, Agriculture Ministry Regulation (Peraturan Menteri Pertanian (Permentan)) 11 2015 about certification systems Indonesian Sustainable Palm Oil (ISPO)




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In the procedure contained source of information for the identification and evaluation of changes in laws and regulations can be obtained through several sources, namely:

• Book of law and regulation • Non-governmental organization • Public information media such as TV, newspaper, internet, email • Seminars and conferences • Related agencies

The company provides a mechanism for evaluation of implementation and compliance to applicable legal requirements in a standard operation procedure i.e. PRO-BM-003 and Form FRM-GEN-028 for OHS Law and Regulation List Register, rev 01, dated 01 May 2015, Form FRM-GEN-029 for Plantation Law and Regulation List Register, Form FRM-GEN-027 for Environmental Law and Regulation List Register, Form FRM-GEN-026 for Manpower Law and Regulation List Register. Compliance status: Full compliance

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

Findings: The company has the legal ownership of land as evidenced by the record:

• Decree of the State Minister of Agrarian / Head of National Land Agency with the number: 26 / HGU / BPN / 94 on the granting of Hak Guna Usaha

• Land Use Rights (‘Hak Guna Usaha’ (HGU)) Certificate No. 1 dated January 20, 1995 • Business License Plantation from Local Department of Plantation Bengkalis with number: 1287

/ UT.518 / VIII / 2004 dated August 14, 2004 • Business license plantation industries from Local Department of Plantation Bengkalis number:

1558 / UT.560 / II / 2005 dated February 7, 2005 with a mill capacity of 90 tons / hour. The company has documents that describe the history of the land, among others:

• Document Upaya Pengelolaan Lingkungan Hidup dan Upaya Pemantauan Lingkungan Hidup for Estate and Palm Oil Mill area of 1233.13 ha in 2002.

• High Conservation Value Identification document (HCV Identification) by Re Mark Asia on 2014

• Social Impact Assessment document (SIA) on 2014 The company has a Special Situation Pictorial Map (‘Peta Gambar Situasi’) Khusus No. 12/1993 with an area of 967 hectares located in the Pinggir village, District Mandau, Bengkalis, Riau Province issued by BPN Riau Province. Based on field observation, done checking peg No. 07, 08, 11, 21 and 22. By sampling the peg in good condition and well maintained. The company has procedures Identification and Maintenance of the Boundary HGU with the document number BM-009 Pro-00 revision dated valid on 1 November 2013. In these procedures regulated on the implementation of the boundary mainte-nance conducted every 3 months. The company also conducts regular maintenance of the existing concession. The company has an SOP for Dispute Settlement / Land dispute No. PRO-BM-006 dated 01 November 2013. The purpose is for defining land dispute resolution mechanisms that occur on estate nucleus land (land controlled and managed by the company). The procedure is as follows: 1. Issues regarding land disputes raised by the public are to be submitted in writing to the company Development Partners and Legal. 2. The ‘Bina Mitra’ (BM) Staff shall analyze and review land claims of which the result will be submitted to the Chief Operating Unit. 3. The BM Staff will conduct analysis and verification based on evidence of land acquisition. 4. Affected parties will be invited for clarification and mediation. 5. If no agreement is reached then the company shall apply to local governments to facilitate the set-




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tlement of disputes. 6. If no agreement is reached, the settlement shall proceed through legal proceedings. Based on interview with community surroudings the company was found there were no conflict between the community and the company. This condition was completed by official announcement letter from the village head or head of community, stated that there were no conflict between both parties. Based on the statement area there are areas of land under dispute between the company and the community. Hence the company has no record of deliberation progress for the settlement of disputes. Compliance status: Full compliance

Criterion 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.

Findings: Based on field observation and interviews with the surrounding community, there were no areas under customary rights of local communities identified within the plantation, even when the plantation area was occupied by previous company for other purpose. The SIA report also did not indicate that there were any areas under customary rights within PT .MSS plantation area

Based on interview with the communities surrouding the company, thetre was found there were no con-flict between the community and the company. This condition was supported by official announcement letter from the village head or head of community, stated that there were no conflict between both par-ties.

And based on the statement area use of the land by PT. MSS for oil palm does not diminish the legal rights, customary rights or use rights of other users around estate PT MSS and there are no areas of land into a dispute between the company and the community. Therefore the company has no record of deliberation progress for the settlement of disputes Compliance status: Full Compliance

Criterion 3.1: There is an implemented management plan that aims to achieve long-term eco-nomic and financial viability.

Findings: The company has a document budget and projection for 5 years (2015-2020) for PT Murini Sam Sam Estate and Mill,including the following contents: - Financials - Area Statement, Crop & Estate Costs - FFB Processed & Milling Cost - Plantation Development Cost - Capital Expenditure for Estate and Mill - Sustainability Implementation Costs Under Financials, the annual projected amount of FFB processed from own estate and own crop, pro-jected annual Oil Extraction Rates (OER) and Kernel Extraction Rates (KER) and projected Crude Palm Oil (CPO) and Palm Kernel (PK) production was stated. Under the Profit and Loss sheet, the pro-jected annual FFB prices for own crop and outside crop as well as projected annual CPO and PK pric-es were stated in Rp‘000, with estimated annual revenue calculated as well and indicating positive total revenue. The company plans to carry out replanting in year 2018 with a mix of 75% clonal oil palm plantlets (Ramets) and and 25% DXP (Tenera) planting material. The clonal planting material is used as it is ex-pected to have a higher yield than the commonly used DXP planting material.




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As shown in Table 5 above, an area of 330.22 ha of year 1993 planted area is planned for replanting in year 2018. It is noted that this does not include planned replanting area for the non-HGU area (not within the current certification scope), in which 250.08 ha of year 1991 plantings is also planned from replanting, hence total planned replanting area including non-HGU area is 529.53ha. Compliance status: Full-compliance

Criterion 4.1: Operating procedures are appropriately documented and consistently implement-ed and monitored.

Findings: The estate has a documented Agriculture Manual and Standard Operating Procedure for Oil Palm year 2011 for Wilmar International Limited. The manual covers standard operating procedures for the follow-ing aspects: 1) Pre-development Survey, Assessment & Planting 2) Oil Palm Nursery Practices 3) Land Clearing and Preparation 4) Establishment and Maintenance of Legume Covers 5) Oil Palm Planting & Supplying/Replacement, and Oil Palm Planting Densityu and Pattern 6) Upkeep and Maintenance of Oil Palm 7) Harvesting of FFB 8) Plant Protection – Pest & Disease Management 9) Oil Palm to Oil Palm Replanting 10) EFB Mulching 11) Quantitative Agro-Management System (QAMS) 12) Oil Palm Thinnning Technique The company also has an FFB purchasing procedure No. 001 / TBS-SOP / VIII / 2015 dated August 10, 2015, for purchase of FFB from external parties. This SOP is to ensure that FFB purchasing activi-ties are conducted properly and are verifiable in terms of continuity, time and the quality of palm fruit were purchased and to ensure no errors or deviations in the purchasing activities of FFB. Further de-tails on this SOP and implementations are described under CR6.10. There is evidence that the company conducted periodic internal audits to check for implementation of the SOPs. For example, there was a visit to the company conducted by the Assistant General Manager for Riau region on 11 September 2015. A report for this visit was sighted and included several findings pertaining to areas where implementation of the SOPs required improvement, e.g. - Failure to harvest some ripe bunches - Loose fruit collection was not optimal There are also annual visits to the estate conducted by Wilmar’s Research & Development Department to inspected the general condition of the estate, with reports generated as seen in R&D visit reports dated 13 June 2015 (for visit on 8th of June 2015) and 14 February 2014 for visit done on 8th of January 2014). The visit reports included comments and recommendations for improvement in areas of upkeep, pest and disease management, pruning, cultivation, and collection. The company also has dedicated internal auditors to evaluate compliance against the RSPO standards as well as the Indonesian Sustainable Palm Oil (ISPO) standard. The company has a procedure no. PRO-GEN-003 dated 26 October 2013 regarding Internal audit which states that the internal audit shall covers evaluation of compliance to requirements for quality, environment, safety, and RSPO. Sighted last internal audit findings report done by 2 internal auditors was dated 24-25 March 2015, in which 17 findings were listed. However, it was observed that the format of the non-conformity findings table pro-vided in this report was not the same format as required in the company’s procedure PRO-GEN-003 for internal audits. The format also did not list any root cause, correction or corrective action as per the SOP nonconformance form, but only stated the date of closure. This was noted as an observation Compliance status: Compliance with observations




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

Findings: The company has a SOP on fertilizer application with with number of procedures SOP-EST-001 re-vised 00 effective date January 1, 2013. The company has records implementation of fertilizer applica-tion from January to October 2015. Based on records of fertilizer application, it was seen that the appli-cation activities was undertaken in accordance with the recommendations of the leaf analysis. The company has records of fertilizer use per ton of FFB, among others:

• NPK: total application until October 2015 amounted to 716,550,000 kg with FFB produced much as 32,869,730 kg so that the application of fertilizers per ton of FFB is 0.021 kg / ton of FFB

• Dolomite: total application until October 2015 amounted to 63,450,000 kg with FFB produced much as 32,869,730 kg so that the application of fertilizers per ton of FFB is 0.0019 kg / ton of FFB

• SOA/ZA: total application until October 2015 amounted to 291,550,000 kg with FFB produced much as 32,869,730 kg so that the application of fertilizers per ton of FFB is 0.0088 kg / ton of FFB

• MOP: total application until October 2015 amounted to 280,500,000 kg with FFB produced much as 32,869,730 kg so that the application of fertilizers per ton of FFB is 0.0085 kg / ton of FFB

• RP: total application until October 2015 amounted to 25,550,000 kg with FFB produced much as 32,869,730 kg so that the application of fertilizers per ton of FFB is 0.00077 kg / ton of FFB

The company has procedure of soil and leaves analysis with number of document Pro-Est-008 revised 01 effective date October 1, 2013. In the procedure stated that the leaf analysis shall be conducted every one year and soil analysis conducted 5-10 years. Based on the existing records, it was seen that the implementation of fertilizer application was conducted in accordance with a procedure that is owned by the company. A record of the results of leaf analysis was done in 2014 by Environmental Management Unit (EMU) Laboratory to obtain fertilizer recommendation in 2015. The results of analy-sis the leaves has described the content of N, P, K, Mg, Ca, B, Cu, Zn, Fe. For the soil analysis con-ducted by Param Agricultural Soil Survey in May 2008. Records the results of the soil analysis and the leaves used as a fertilizer recommendations and fertilizer program in 2015. The company has records of the use EFB to maintain soil fertility. The company has records of EFB application from January to October 2015 covering an area 80.01 ha with the amount of empty bunch much as 3,200,700 kg. The program includes application doses per year of planting for each block. For the palm oil mill effluent which is applied for Land Application, records show amount applied in year 2014 was total of 149,901 m3 and in year 2015 was 160,123 m3 (until October 2015). Compliance status: Full compliance

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

Findings: The company does not have marginal land. The company has a map of type soil with a scale of 1: 50,000. Based on the soil type maps, PT. MSS, including of the type Alluvial. The company does not have a management strategy for planting on sloping areas. Based on map slope, PT. MSS is a flat area covering an area of 866 ha (flat undulating), undulating covering an area of 96 ha and hilly covering an area of 5 ha. The company has a maintenance road program to the main road or collection road in 2015 and sup-ported with a budget that contained in budget 2015. Supporting equipment includes one grader. Rec-ords of road maintenance in 2015 include:

• Maintenance of the main road in 2015, planned throughout the 13,000 meters and the imple-mentation until October 2015 throughout the 10,832 meters




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• Maintenance of the collection road in 2015, planned throughout the 64,163 meters and the im-plementation until October 2015 throughout the 53,728 meters.

The company does not have any area of peat and marginal soil. Compliance status: Full compliance

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

Findings: The mill has a documented water management plan for 2015, which includes a schedule for measures to reduce water usage. Actual implementation of planned activities is also monitored and recorded by the mill. Murini Samsama estates have all developed a documented water management plan for year 2015 which includes performing regular maintenance of watergates, regular desilting of drains (main, collection, boundary and field drains) and digging of pits to collect excess water. A schedule to carry out these activities once a month was also developed and details of activities carried out are recorded. Murini Samsam estate also has a documented schedule for carrying out desilting of drains only in spe-cific months. Hydrology maps of the estates show that there are no big rivers or permanent watercourses flowing through Murini Samsam Estate, and water does not accumulate within the estate area. In Murini Sam-sam estate, there is a small network of streams that flow to Meranti River, but these streams only exist during raining season, so there are no permanent streams at this estate. To protect the water flow and prevent erosion, the management of PT Murini Samsam designated riparian buffer zones 10 meter width on both side of the river, where palm trees are marked with yellow paint to mark the buffer zones where chemical application is not permitted. The company has also planted vetiver grass that can accelerate coverage of the open ground and prevent erosion. Murini Samsam estate established plans to main-tained riparian river in good condition until replanting. As stated in the company’s High Conservation Value report prepared in year 2014, the estate experi-ences periodic flooding at areas adjacent to Mandau River, usually during rainy season, with flood heights reaching 0.5 – 2m and usually going down on after 3 days. To manage this issue, the company has developed a drainage system to reduce the flooding. The company also maintained a reservoir for water within the housing area to be used for consumption of staff and workers. The company carries out annual quality analysis of upstream and downstream points of Mandau River and Merantai River, with samples sent to the Unit of Technical Implementation for Materials Testing Laboratory, Riau Province Government. As seen from the latest river quality analysis results for year 2015, the river water quality results were as follows: - For water samples of Mandau River dated 9 April 2015, the BOD and COD of the upstream sample

was 17.81 ppm and 59.36ppm respectively while for downstream sample was 21.12 ppm and 70.40ppm respectively. Both samples exceeded the standard of 6 ppm for BOD and 50ppm for COD for Class III water sources as per the local regulation PP 82 year 2001, and the BOD and COD results showed a decrease in water quality in the downstream samples compared to up-stream

- For water samples of Meranti River dated 24 June 2015, the BOD and COD of the upstream sam-ple was 17.62 ppm and 43.02 ppm respectively while for downstream sample was 11.07 ppm and 40.07ppm respectively. Both samples exceeded the standard of 6 ppm for BOD for Class III water sources as per the local regulation PP 82 year 2001.

However, since the upstream samples were noted to have already exceeded the legal limits for water quality, the source or river pollution most likely came from other sources. As informed during the Stakeholder Consultation meeting, there were a number of other companies in the area that had pollut-ed the river. The mill maintains records of water usage per tonne FFB. The trends of water usage are compared against their monthly target of 1.8 tonnes of water used per tonne of FFB. The mill conducts sampling of




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effluent BOD5 (outlet pond no.6 and 7) with tests conducted externally (Unit of Technical Implementation for Materials Testing Laboratory. Riau Province Governmen). The mill conducts sampling of effluent BOD5 (outlet pond no.6 and 7) with tests conducted externally (Unit of Technical Implementation for Ma-terials Testing Laboratory. Riau Province Government). Sample results show (period of April 2014 to June 2015) that effluent BOD5 for land application is below 5,000 pm as required in the mill’s land appli-cation permit No.156/KPTS/III/2011 dated 31 March 2011 which valid for 5 years. Based on monthly production report (FRM-MIL-101) that the mill has water usage data/information each monthly for year 2015 (until June), divided into process water usage per tonnes FFB, boiler water usage per tonnes FFB and domestic water usage per tonnes FFB. Source of water usage in mill are surface water and In year 2015 until October that total water usage are 228,596 m3 (1.6 m3/tonnes FFB) such as processing are 51,419 m3 (0.14 m3/tonnes FFB), boiler are 177,150 m3 (0.77 m3/tonnes FFB) and domestic are 75,991 m3 (0.69 m3/tonnes FFB). Whereas, total water usage year 2014 are 325,171 m3 (1.54 m3/tonnes FFB) such as processing are 60,221 m3 (0.22 m3/tonnes FFB), boiler are 201,623 m3 (0.73 m3/tonnes FFB) and domestic are 162,013 m3 (0.59 m3/tonnes FFB). The company has been pro-gram water management plan for year 2015 regarding information quality, availability of surface ground water and use of water, based on data of rainfall at around HGU PT Murini Sam Sam average 187.42 mm per years. Compliance status: Compliance with observations

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

Findings: The company’s procedure for IPM is as documented in the SOP for Detection and Census of Pests and Diseases, SOP-EST-019 dated 1 January 2013. The procedures covers SOPs for conducting cen-sus for leaf-eating pests (nettle caterpillars and bagworms), Oryctes rhinoceros (rhinoceros beetles), rats, termites, Ganoderma and upper stem rot. Management of nettle caterpillar pests is described in the company’s SOP for Nettle Caterpillar Management with Fogging, SOP-EST-020 dated 1 October 2013. The estate currently only carries out regular detection and census of nettle caterpillar and bagworm pests as these are the most common pests, while attacks rates of other pests are considered low and regularl census is not required. According to SOP, detection is done once every 4 months for each block, followed by a census where caterpillar attacks are found. Sample completed detection forms for each block were sighted for month of April 2015, July 2015 and October 2015 as well as completed census forms for each block where attacks were found, were sighted. The data from the detection and census results and summarized in a monthly summary for which indicated the number of live larvae and percentage live larvae found at each block. Where it is found that the level of caterpillar or bag-worm attacks is medium (>2-5%) or high (>5-10%). As seen from detection and census records for year 2015, there were only two blocks, i.e. block 7 and 8 in month of April 2015 found have high cater-pillar attack rates above 30% for small, medium and large sized larvae. This was noted in The company took action by conducting fogging with the chemical Bravo, covering 7.5 ha on 10 April 2015. As seen from subsequent detection and census records, the attacks rates at these blocks re-duced after treatment and no further chemical application was done throughout the estate as attack rates were found to be low in July and October 2015. As part of biological control to reduce attacks rates of nettle caterpillars and bagworms, the company has also planted turnera subulata, a beneficial plant which attracts natural predators of leaf-eating pests. Total area planted with turnera covers 1065 ha, and maintenance is carried out once every 3 months, as seem from the work plan maintenance of turnera subulata for year 2015. In line with recommendations from the company’s R&D department in R&D visit report dated 14 Febru-ary 2014 for visit done on 8th of January 2014, the company had installed one barn owl box in each of the estate’s 17 blocks as biological control to reduce attacks of rat pests. The company conducts maintenance of the boxes once every 3 months, according to a documented programme for Barn Owl Box maintenance, as well as a weekly census of the barn owl boxes, which is recorded on Barn Own Box monitoring sheets, including the occupancy rate of the boxes. The census records for each box




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sighted for September 2015 showed that all boxes were frequently occupied. There are records of IPM training done on 13 January 2015 for 5 participants, and on 22 February 2015 for 13 participants done at the estate office. Training records included a list of attendance and photos. For training conducted on 13 January 2015, individual training evaluations were conducted for each training participant. Compliance status: Full compliance

Criterion 4.6: Agrochemicals are used in a way that does not endanger health or the environ-ment. There is no prophylactic use of pesticides, except in specific situations identified in na-tional 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.

Findings: PT Muruni Samsam Estate has a recommendation Letter No.: 560/DTKT/PK/2014/58, dated April 29, 2014, concerning of Pesticides Usage, from District Labor Office of Bengkalis District Government. For PT Murini Samsam Estate, chemical recommended for us include Lindomen: 80 ltrs/Year, Glisat : 1,700 ltrs/Year, Decis 10Kgs/Year, Tiara: 30Kgs/Year, Winson: 30Kgs/Year and Capture : 20 ltrs/year. The estate also maintains a register of chemicals used for year 2015, which includes information on pesticide name, active ingredient, class, LD50, mode of action, target, recommended dosage, producer and registration number according to the Indonesian Green Book, which lists legally registered chemi-cals. The chemicals included in the register are as follows: Herbicides: 1) Glisat 480SL; a.i. isopropyl amine; LD50: 4230mg/Kg; dosage: 1.5-2L/ha 2) Ken-Amine 865 SL; a.i. 2,4-D dimethyl amine; LD50: 375mg/Kg; dosage 1-2L/ha 3) Tiara 20WG; a.i. Methyl metsufuron; LD50: >5000mg/Kg; dosage: 0.075 L/ha 4) Glinat 150SL; a.i. Ammoniu, glufosinate 150g/l; LD50: 1625 mg/Kg ; dosage: 4-6 L/ha 5) Abolisi 865; a.i. 2,4-D dimethyl amine; LD50: 375mg/Kg ; dosage: 865 L/ha Insecticides: 6) ICON 25EC (for use against mosquitoes); a.i. Lambda cyhalotrin; LD50: C56 mg/Kg ; dosage: 1-25

ml/ha for high volume spraying and 40 ml/ 2-5 litre for fogging 7) Bravo 50 EC (for used against nettel caterpillars); a.i. cypermethrin ; LD50: 250 mg/Kg; dosage:

0.01 L/ha The estate maintains monthly summaries of usage of each type of herbicide and insecticide which in-cludes information on block applied, area applied, no. of stands, stands per hectare, type of spraying conducted and hectarage applied. The form also includes calculation of amount of pesticides applied per hectare and active ingredient applied per hectare. For example, as seen from records of chemical application for month of August 2015: - Glisat applied was 596 litres over 71.53 hectares, with a.i. of 480g/l, which is equivalent to 8.33 li-

tres/ha and 3,996 g/ha of active ingredient - Tiara applied was 6.9 litres over 71.53 hectares, with a.i. of 20%, which is equivalent to 0.10 li-

tres/ha 0.03 g/ha of active ingredient - Abolisi applied was 3.5 litres over 87.37 hectares, with a.i. of 865g/l, which is equivalent to 0.04 li-

tres/ha or 34.65 g/ha of active ingredient - Glisat applied was 17.5 litres over 87.37 hectares, with a.i. of 150g/l, which is equivalent to 0.20 li-

tres/ha or 30.04 g/ha of active ingredient Report of chemical usage for September 2015, in total area applied 319.63 Ha : Giisat 480SL : 1.5ltrs/Ha, Tiara 20WG : 0.075ltrs/Ha, Glinat 150 SL : 6ltrs/Ha and Aboliisi 865 : 865 grams/Ha The toxicity recapitulation of Herbicide, Glisat 480SL, at Murini Samsam Estate showed that in Septem-ber 2015, the applied area was 319.63 Ha, amount of glisat used was around 101,6 liter, active ingredi-




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ent was Isoprophyl amina glifosat 480 grams/liter, dose per ha was 1.5 liters, and the chemical is classfi-fied as Class U with LD 50 for humans of 4230mg/Kg. Records show that chemicals used in estates during the year 2015 are legally registered chemicals, such as Glisat with the active ingredient glyphosate isopropylamine. The company maintains monthly data on pesticide use trends of the chemicals listed under WHO Type IA, IB, or listed under the Stock-holm and Rotterdam Conventions. Murini Samsam estate has developed a plan to reduce their usage of pesticides. Checks of pesticides issuance records at Murini Samsam showed that very little of this chemical is used at this estate. For example, usage of pesticides for IPM management is minimal and only applied when attack rates of caterpillars is considered high. The last usage of chemicals for fogging of nettle caterpillars was in April 2015, where Bravo applied was 3.5 litres over 87.37 hectares, with a.i. of 50g/l, which is equivalent to 0.04 litres/ha or 34.65 g/ha of active ingredient. It was verified from pest census records that attack rates were high during this period, which warranted the use of chemicals for control. Prior to that, the last usage of Bravo was in March 2014. The organization has been demonstrated that all pesticides handled, used and/or applied by persons who have completed the necessary training. Some document were reviewed, i.e: - Training Need Identification to improved human resources, year 2015 at Murini Samsam Estate.

The results, i.e: Training of Handling and Usage of Hazardous Materials. It was attend by 1 person of warehouse personnel, 6 (six) persons of maintenance foreman (Mandor), and 20 maintenance employees who related to hazardous substance.

- Letter of Murini Samsam Estate Manager on March 18, 2015, concerning Training of Chemical Us-age. The letter said that; request of training for all pesticides / chemical-applying worker (according to Decree of ministry of labor: 187/Men/1999.

Briefing on hazardous material usage, and training of fertilizing / Maintenance Palm Oil Mill, date March 11, 2015 at Murini Samsam Estate PT Murini Samsam estate and the mill have their own licenses for hazardous waste collection, including for chemical containers, which are confirmed to be valid at explained under CR2.1 above, while Murini Samsam estate sends their hazardous wastes for collection to Murini Samsam estate. Murini Samsam estate maintains records of amount of hazardous wastes received from Murini Samsam estates, as seen from sample receipt records for 30 September 2015 and 30 June 2015. Murini Samsam estate maintains records of incoming hazardous wastes in Control Form for Incoming and Outgoing Hazardous Wastes and Inventories of Hazardous Wastes. Licensed contractors PT Shali Riau Lestari, where most recent collection was on 30 June 2015 and prior to that was 18 January 2015, collect hazardous wastes. It was found that the inventories for all hazardous wastes at PT Murini Samsam estate have been up-dated from January to June 2015 up until time of collection by the contractor. For example, last inventory update for oil filters was 174 pieces on 30 June 2015. Inventory records at the mill hazardous waste stores were found to be consistent with the hazardous waste collection summary note prepared by the mill and final collection amount stated in the manifests. PT Murini Samsam has no planning for pesticide application aerially, the requirement is not applicable. There is evidence of training on chemical application done. There is a letter from the Murini Samsam Es-tate Manager on March 18, 2015, concerning Training of Chemical Usage. The letter requested for train-ing for all pesticides / chemical-applying worker (according to Decree of ministry of labor: 187/Men/1999. Recordsof hazardous material usage, and training of fertilizing / Maintenance Palm Oil Mill, dated September 1, 2015 at Murini Samsam Estate were sighted. Murini Samsam Palm Oil Mill & Estate, there is a chemical-spraying activities and it were observes the workers had good understanding of their job and resposbilities related their job risks and complete per-sonal protective equipments were found being worn by the workers while perform the job including dur-ing disposal of the chemical containers used. There is evidence that the organization has perform specific annual medical surveillance for pesticide operators, for example: There is Report of Measurement/Examination Report Working Environmental dan Medical Check PT




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Murini Samsam Year of 2015, Document No.: 66/MSS/IX/20145, issued by A’AD Hospital ; The medical check up was include:

1. Audiometry 2. Spirometry 3. Cholinesterase (consist of 14 women worker) 4. Pb on Blood

From interviews of female sprayers at Murini Samsam estate, they said that they undergo medical checkups once every 3 months and this includes blood and urine test and checks for headaches or skin itchiness. Sprayers interviewed at all estates also mentioned that they receive free supply of milk from the management once a week. The milk serves to neutralize the effects of pesticide poisoning and it is required by law in Indonesia to provide milk to workers handling pesticides. Based on the medical check-up result, show that all personnel’s health is still normal. There is evidence that the organization has defined a mechanism to ensure that all chemical-applying worker not consist of pregnant women and not pregnant nor breastfeed their babies, even for the com-pany’s sub-contracted workers but in Murini Samsam estate there was no sub-contractor workers for this kind of work. Compliance status: Full compliance

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

Findings: PT Murini Samsam Estate has a documented occupational safety and health (OSH) policy. Murini Sam-sam Estate an Palm Oil Mill OSH policy dated 22 May 2015 which is signed by the Country Head of Wilmar Group Indonesia. The OSH policy includes documented objectives and targets, i.e. to comply with the company’s OSH procedures, committed to wearing of Personal Protective Equipment (PPE) at work sites, and manage potential work risks at the site. The company has demonstrated consistency in implementation in Occupation Safety and health, as during 2012 to 2014 they had achieved Zero Acci-dent certificate number 358 Year 2015 date 31 August 2015 from The Indonesia Ministry of Manpower according to Ministry Regulation No. PER-01/MEN/I/2007.

PT Murini Samsam Mill has identified and documented Occupational Health and Safety (OHS) risks for all mill activities as this was documented under its 5 August 2015 environmental aspects and impacts register. The designated PPE storage area in PT Murini Samsam Mill Laboratory was located properly as the lab’s crew can easily locate the available PPE that must be worn during their activities in there. Also the Shower/Eye wash station was easy to used when the emergency situation occurs and some safety warning signs were found during plant tour activities in the PT Murini Samsam Palm oil mill at the certain places such as stairs in the sortation area and safety accessory such as Rotary lamp, back alarm and the mirrors for 1 available wheel loaders was properly attached at the machine.

Also in PT Murini Samsam Mill was have a consistent implementation in the work permit system imple-mentation such as was found as the welding process work in the mill also PT Murini Samsam Estate has Hazard Identification, Risk Assessment and Risk Control document for 2015, dated 6 January 2015 for all estate activities including spraying, manuring, harvesting, workshop activities, generator, truck transportation, chemical and material storage, and waste handling. Chemical storekeeper in Murini Samsam Estate is provided with helmets, boots and goggles and look much aware to the visitor that need to wear the PPE while entering his area as it was already arranged in procedure No. PRO-GEN-016 Rev0 2009 related to Personal Protective Equipment. Contract field-maintenance workers are also required to wear boots and provide by company. Female spraying/manual maintenance workers interviewed in Murini Samsam are provided with Personal Protective Equipment (PPE) by the company, including masks, gloves, and plastic aprons. The sprayers are provided with ap-propriate cloth gloves for spraying activity. While they wash their PPE at washing facilities at the division office and they store their PPE in the estate store.




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As sighted from Murini Samsam Estate documents, Head of Social, Manpower and Cooperation Office of Bengkalis District by virtue of Decree No KEP/DTKT-PK/P2K3/2015/661 dated 4 November 2015 have approved the organisational team of Estate OSH structure. As for PT Murini Samsam Mill, the Head of Social and for Murini Samsam Estate : Manpower and Cooperation Office of Bengkalis District through Decree No KEP.105/DTKT-PK/P2K3/2015 dated 29 August 2015 have approved its organisa-tional structure team of OSH. Regular reporting system to the related responsible local government also were sighted as they were found to be providing quarterly reports which consist of the OHS team activi-ties such as safety patrol, inspection, regular meeting and emergency drill, summary of accidents report using Frequency Rate and Severity Rate calculation.

The company has an emergency response procedure documented under Standard Operating Procedure No. PRO-GEN-013 Rev 05 dated 15 April 2015, including identification of potential emergency situations (fire, accidents, flood, explosion, and chemical leakage) and a flowchart for Handling Fire Emergencies. PT Murini Samsam Mill has records of emergency response training and simulation on 18 December 2014 for over 40 workers, as well as land burning simulation on 22 May 2015 for 35 estate division staffs. It was confirmed through interviews with three harvesters that they had attended the emergency response training. Notes of the training results are maintained, including the steps of the accident & emergency response procedure. Records of other OSH training, i.e. for first aid and management of hazardous waste, are available as described under CR4.8. Fire emergency training for Murini Samsam Estate was conducted on 15 January 2015 for 46 staff. Training on emergency response procedure for fire was conducted in June 2015 for 31 workers at Murini Samsam Estate.

During site visits, field executor (supervisor) in Murini Samsam Estates were found having brought first aid kits to the field, and those are located at other locations such as estate office, workshops, chemical storehouse, etc. It was observed that the first aid kit at Division 1 of Murini Samsam office a complete pack of first aid kit. However for harvester and manurer foreman also have a first aid kit.

Estates and Mill provide National Employee Social Security (Jamsostek) to permanent employees, as sighted from sampled payslips of 3 harvesters of Murini Samsam Estate, as verified with interview. Ac-cording to the company’s Work Instruction for Jamsostek Participants and Fees, the amount paid by the company for Jamsostek contribution is 3 % of the employees' basic salary, while another 2% payment is made through regular deduction of their basic salary. It has been verified paid correctly. As for contract workers, Murini Samsam Estate deducts the amount required for their insurance against payment to the respective contractors, and pays this insurance amount directly to the relevant authority to ensure that all contract workers are covered with insurance.

In the annual medical surveillance were found the results of audiometric examination for employees who experience mild restricted hearing were as many as 22 people. Follow-up need to be done in the form of consulting the company doctor and awareness programs to further sensitize employees to use PPE. This was raised as an observation. The occupational injuries recorded using Lost Time Accident (LTA) has been defined in the report and in-vestigation procedure No. PRO-GEN-014 Rev.01 dated 12 November 2010 such as incident happen on 10 April 2015, time incident was on 6.15 PM for one harvester employee, report completed with the wit-ness statement and chronology of the accident also briefing conducted to prevent reoccurrences. No LTA happen during the time as the injured person can back to work after first aid treatment from para-medic. Record of total man hours is stated on form No. FRM-SHE-008 revision 00 dated 1 July 2010. Compliance status: Compliance with observations

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

Findings:

As sighted in the FRM-HRD-013 a training program for year 2015 for PT Murini Samsam estate employ-ees is available. The training program consist of chemical handling training, Integrated pest manage-ment and early warning system, electrical overhead power line harvesting activities and HCV training. Evidence of the trainings conducted above was well maintained including their signed attendance list, training materials and completed with the training evaluation. PT Murini Samsam Mill has also docu-mented 2015 training plan, including training plan for OSH hazard and risk identification, workplace safe-ty inspections, first aid training, hazardous waste management, and emergency response training. The




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estate and Mill have documented worker identification that requires training. For example in January to December 2015, Murini Samsam Estate has also identified the training needs for total of 60 harvesters and maintains training participant record. The training programme in 2015 has also been observed to in-clude harvesting, fire emergency and pest management trainings.

The company’s estates maintain records of trainings delivered by contractors to their workers. As PT Murini Samsam Estate harvesting training was delivered on January 2015. Signed attendance 20 partic-ipants list for Emergency Response Procedure, self assessment training including the training evalua-tion. Report on training result employees including the post training evaluation result was well docu-mented in the mill office. The estate also carries out evaluation of workers understanding on the train-ings provided.

Murini Samsam Estate holds records of competency certificates for employee such as General OHS specialist certificate, OHS electric operator, Welder Operator, First Aider certificate and several available contractors, i.e. contractors mill and road maintenance. Selection of contractors providing spraying workers not done as they are not using the contractor for spraying activities. Compliance status: Full compliance Criterion 5.1: Aspects of plantation and mill management, including replanting, that have environ-mental impacts are identified, and plans to mitigate the negative impacts and promote the positive ones are made, implemented and monitored, to demonstrate continuous improvement. Findings: The mill has their Environmental Management Documents or Dokumen Pengelolaan Lingkungan Hidup (DPLH) which was revised from their previous approved document No.660/Bapedalda/319/2002 on 14 September 2002 and approved by the Head of Pekanbaru Regional Body for Management of Environ-mental Impacts as Mill capacity was changed from 45 tonnes/hours to 90 tonnes/hours. However the progress of DPLH revision should be immediately followed up in view of changes in the plant's produc-tion capacity of 45 tons / hour to 90 tons / hour has been happening since 2005, this is raised as obser-vation. This document includes details of the mill's activities pertaining to oil palm processing and pro-duction also analysis results for air quality, NOx, SOx, particulate, carbon monoxide, land water quality, biological components and so on. Estates have their Environmental Management Efforts (‘Upaya Penge-lolaan Lingkungan’ (UKL)) and Environmental Monitoring Efforts (‘Upaya Pemantauan Lingkungan’ (UPL)) document which was last revised on 21 April 2011 and approved by the Head of Pekanbaru Re-gional Body for Management of Environmental Impacts No.660/Bapedalda/319/2002 on 14 September 2002. The UKL and UPL document includes details on the estate activities, usage of natural resources, climate, air and water quality, geography and other environmental aspects, social aspects, potential en-vironmental impacts and monitoring.

The mill and all estates have also conducted their Identification of Environmental and Occupational Safety Aspects and Impacts dated 13 January 2015 for the mill, 16 January 2015 for Murini Samsam es-tate. The document covers environmental and safety aspects and impacts for estate work activities (eg. manual treatment, mechanical treatment, harvesting and tree maintenance), office activities, housing, management of hazardous wastes and domestic wastes, usage of natural resources, warehouse opera-tions, transport and so on.

The mill and all estates prepare a report every 6 months based on their UKL and UPL documents as re-quired by legal requirements includes reports on air quality, emissions from electrical generator, groundwater and soil quality, and noise. In Murini Samsam Estate, such report includes result of analy-sis of the same parameters, as well as of odour levels, and amount of hazardous waste produced. This is reported semi-annually, while some parameters to be reported annually have been sighted in the es-tate’s December 2014 report, e.g. analysis of employment opportunities, local community perception and CSR activities. The analysis results indicate no excess towards legally permitted standards. The last re-port was prepared on December 2014 and includes monitoring and analysis results for ambient air and noise, water quality, and evaluation of results as they were sighted on report number 860/MT.I/08.06.70.169 for air ambient test result in Murini Samsam estate, 860/MT.I/08.06.70.172 dated 6 August 2015 for Clean Water test result from ground water sample point, No. 860/MT.I/08.06.70.171 for Plankton Benthos test result from surface water sample which conducted by Unit of Technical Im-plementation for Materials Testing Laboratory. Riau Province Government. The analysis results for mill air and water quality show no exceedance of environmental parameters to legal standards. From the re-




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ports, it was found that all environmental quality parameters measured were within the legal standards. The report has already been distributed to the related government department which concern to this UKL and UPL (Environment Management Efforts) as required by law and regulation. Compliance status: Compliance with observation

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

Findings: The company has identified high conservation value (HCV Assessment) in the area of the concession. Identification of HCV conducted in April 2014 by PT. Remark Asia. Based on identification of HCV, there are 53.78 hectares including high conservation value areas consisting of:

• HCV 1.1 Areas which have or providing support functions of biodiversity for protected areas or conservation covering an area of 53.78 ha (Mandau river riparian, Meranti river, water reser-voir 1, 2 and 3, shrub swamp)

• HCV 1.3 Areas that are habitat for populations of threatened species, restricted range or pro-tected survives covering an area of 46.84 hectares (shrub swamp merges with Mandau ripari-an river)

• HCV 4.1 Areas or critical ecosystems as water supply and flood control for downstream com-munities covering an area of 24.26 hectares (water reservoir and river border)

Identification of HCV areas was conducted by PT. Remark Asia headed by Mr. Cecep Saepulloh that has got qualification as HCV team leader and specialist from RSPO. In the report, there is a list of re-source persons referenced for HCV assessment activities including from the company, local communi-ties, the government, community leader. There is also the minutes of the stakeholder consultation HCV Assessment and photo documentation of the public consultation. Based on results of the HCV assessment obtained information that there are species of fauna include: Birds: 3 types, Mammals: 6 types (one type of EN (IUCN) is the Sumateran elephant = Elephasmaxi-mus sumatrensis, Reptiles: 2 types (one type of EN (IUCN), namely Sapit Crocodile = Tomistoma schlegelii The company has identified the HCV areas within the overall company concession. Identification of HCV areas was conducted with reference to HCV toolkit that has accommodated the HCV NI. The company has a map of HCV which was overlay with concession maps and map work area with a scale of 1: 50,000. Based on assessment report the identification of HCV there are areas that is habitat for the populations of threatened species, restricted range or protected species able to survive in the form of Endangered (EN), namely Sumateran Elephant and Sapit Crocodile. Based on report and results of the identification of the HCV assessment, there is a management and monitoring plan for the area which a habitat for populations of threatened species, restricted range or protected to survive. Some of the management and monitoring plans include monitoring erosion regu-larly on Mandau river riparian, monitoring the condition of the river riparian, monitoring the success of planting or enrichment in the areas of HCV, monitoring of the number of species and wildlife popula-tions, estate security patrols, monitoring wildlife populations, monitoring rehabilitation results condition of the plant around the river riparian and reservoir water, monitoring of water quality at Mandau river and Meranti river, put up a sign warning and briefing on HCV areas. The company has implemented a plan that has been prepared. Some examples of implementation of the plan has been prepared, among others:

• Briefing on HCV management done regularly every six months to the employees and staff. • Put up information signboard, protected animals and restrictions




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• Marking boundaries of the water reservoir protected area • Planting Vertiver grass around the Meranti river riparian • Testing water quality of Mandau River • The company carries out regular monitoring every 1 month of the HCV area. Records of moni-

toring are set forth in the conservation area management report and the minutes of activity. The company routinely conducts site inspections to ensure the implementation from mitigation plans that have been made. The company has an environmental policy issued on May 22, 2015 and signed by Country Head. In the policy regulated that the company complies with environmental liabilities according to the law and legis-lation that apply. The company has a monthly program of briefings to employees, staff and other peo-ple protected animals. The company carries out field inspections to check the traps at the site of HCV set forth in monthly report of the findings of HCV. In the procedure of the protection of flora and fauna with the document number SOP-GEN-029 revision 01 effective date 8 September 2015 have been declared of sanctions follow the provisions of legisla-tion, government regulations applicable if the employee proved to do things that are prohibited that is not allowed to trade the wildlife both protected and unprotected The company has a management plan and monitoring of HCV area in 2015-2019 as outlined in the document number: MSS-001 HCV-00 revision effective date of January 2, 2015. In the plan described about HCV location, classification, status and comments, actions to be taken, responsible, deadlines and budgets are planned. The company has a monitoring report for the HCV area. The company does not have any HCV areas that are located next to or within local community areas. Compliance status: Full compliance

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

Findings: The mill and estate have identified all potential sources of wastes and pollution in their Environmental and Safety Aspects and Impacts Identification document FRM-GEN-071 prepared in updated year 2015. The company has a documented identification of wastes generated from estate activities, including the field, workshop, store, office and housing area. The waste management plan includes identificaton of type of waste produced (organic, inorganic or hazardous), form of waste (solid, liquid or gas), signifi-cance level, management plan and person-in-charge. All estates have a Standard Operating Procedure available for management of domestic wastes generated from housing & offices, plastic wastes as well as for hazardous wastes Murini Samsam estate and the mill have their own licenses for hazardous waste collection No.061/Kpts/BPMP2T-PZN/IX/2014/1077 valid to next 5 years and which are confirmed to be valid at explained under CR2.1 above, while Murini Samsam estate sends their hazardous wastes for collection to Murini Samsam estate temporary waste storage. Murini Samsam estate maintains records of amount of hazardous wastes received from Murini Samsam estates, as seen from sample receipt records for 7 July 2014 and 29 April 2014. Murini Samsam estate maintains records of incoming hazardous wastes in Control Form for Incoming and Outgoing Hazardous Wastes and Inventories of Hazardous Wastes. Hazardous wastes are collected by Licensed contractors PT Shali Riau Lestari, where most recent col-lection was on 30 June 2015 and prior to that was 18 January 2015, collect hazardous wastes. It was found that the inventories for all hazardous wastes at PT Murini Samsam estate have been up-dated from January to June 2015 up until time of collection by the contractor. For example, last inventory update for oil filters was 174 pieces on 30 June 2015. Inventory records at the mill hazardous waste stores were found to be consistent with the hazardous waste collection summary note prepared by the mill and final collection amount stated in the manifests. The mill conducts sampling of effluent BOD5 (outlet pond no.6 and 7) with tests conducted externally




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(Unit of Technical Implementation for Materials Testing Laboratory. Riau Province Government). Sample results show (period of April 2014 to June 2015) that effluent BOD5 for land application is below 5,000 pm as required in the mill’s land application permit No.156/KPTS/III/2011 dated 31 March 2011 which is valid for 5 years. Land Application Block marking should be done in accordance with the license which al-ready held by the company. This was raised as an observation. Compliance status: Compliance with observations

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

Findings: The company has a Projection Period 2015-2020. In these projections planned construction of Me-thane Capture in 2016. The company also has a program of monitoring the efficient use of renewable energy, the use of diesel fuel and electricity use. The company at this time is conducting monitoring of the efficiency of the use of shell, fiber, diesel fuel and electricity. The company carries out monitoring among others: Year 2014:

• Use of energy produced from the use of fiber and shell is 5,935.975 kcal/ton FFB or 32,250.832 kcal/ton CPO

• Use of diesel fuel used for generators much as 107,650 liters with 285,887.563 tonnes of FFB processed so the use of diesel is 0.376 liter / ton FFB

• Use of diesel fuel used for heavy equipment and vehicle operation with much as 75,992 liters of 258,887.563 tonnes of FFB processed so the use of diesel is 0,293 liters / ton FFB

Year 2015 (until October 2015)

• Use of energy produced from the use of fiber and shell is 4,325.304 kcal/ton FFB or 23,892.15 kcal/ton CPO

• Use of diesel fuel used for generators much as 110,450 liters with 329,796.795 tonnes of FFB processed so the use of diesel is 0.334 liter / ton FFB

• Use of diesel fuel used for heavy equipment and vehicle operation with much as 86,058 liters of 329,796.795 tonnes of FFB processed so the use of diesel is 0,260 liters / ton FFB

Compliance status: Full compliance

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

Findings: The company implements a zero burning policy in accordance with Chapter 3: Land Clearing and Preparation of the documented Agriculture Manual and Standard Operating Procedure for Oil Palm year 2011 for Wilmar International Limited which states that areas prepared for land clearing shall be felled and green stacking (zero burn) carried out using windrow mechanical stacking. As the company has not carried out as replanting since the establishment of the company, there is evi-dence yet of implementation of this policy. The first replanting is planned only for year 2018. Compliance status: Full compliance

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




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Findings: The estate has a documented matrix for monitoring and management of greenhouse gases for year 2015, dated 2 January 2015. The document includes greenhouse mitigation plans for activities identi-fied to produce greenhouse gases, applicable location, period of monitoring and management and re-marks. The activities listed and summary of improvement activities include: 1) Application of fertilizer – to reduce area where fertilizer application is conducted by not applying at

river riparian buffer zones and water bodies, to apply fertilizer according to recommendation and budget, no disposal of fertilizer bags at areas other than the store

2) Usage of pesticides – to reduce area where chemicals are applied by not applying chemical pesti-cides by the river riparian buffer zones and edges of water bodies, usage of pesticides shall be ac-cording to the recommendation and budget, no disposal of chemical containers at areas other than the hazardous waste store, no chemical mixing to be done in the field, only at the store, implemen-tation of IPM techniques such as planting of turnera subulata, and barn owl boxes

3) Usage of fossil fuels, oil and grease – usage of containers during refilling of fossil fuels to contain any spillages, to clean up spillages with the spill kit and reuse if possible, usage of the oil trap at the workshop to contain any spillages brought by the rain, to store empty oil containers at the haz-ardous waste store

4) Gaseous emissions from heavy machinery – regular maintenance of heavy machinery to reduce inefficient burning, testing of gas emissions from moving vehicles, ambient air testing to be con-ducted at the plantation surroundings

5) Usage of electricity – to use electricity at each work station only when work is being done, to en-courage staff and workers to save electricity while at home

6) EFB application – EFB to be applied evenly in accordance with the SOP, application to be carried out in accordance with the work program

7) Estate operations - to carry out zero burning both at the housing environment and in the plantation area, to conducted land clearing mechanically, to protect identified HCV areas, to en-rich/rehabilitate plantings at HCV areas with local spcies of wood, and to inform local communities as well workers, especially those with land around the estate’s HGU area, to not carry out any land burning and to not destroy the HCV areas.

The mill also has a documented identification of greenhouse gas emissions which includes boiler emissions, diesel genset emissions and methane gas emissions. The identification also stated te risk level of the emission source, management plan, status of implementation and frequency. The man-agement plans for each identified source is as follows: - Boiler emissions: To carry out preventive maintenance according to the defined schedule - Diesel genset emissions: To carry out preventive maintenance according to schedule and to carry

out genset emissions testing - Methane gas emissions: To carry out effluent testing once every month. The mill also has plans to

implement a methane capture project in year 2016, and had prepared a budget of Rp26,600,000 for implementation of this project. No other evidence of implementation was sighted yet as the planning of the project is still underway.

The company has carried out monitoring of greenhouse gas emissions using the RSPO approved Palm GHG. Data as seen in the Palm GHG Summary Report were as follows:

- Emissions calculated from estates was 944.13 tCO2e for fertilizer manufacture and transport, 2519.28 tCO2e for N2O from fertilizer application, 231.62 tCO2e from fuel consumption and 448.39 from peat oxidation from a small area of sapric soil covering only 2.5 ha. Total estate emissions was determined to be 4143.42 tCO2e, or 3.20 tCO2e/ha and 0.13 tCO2e/tonne of FFB produced

- Emissions generated by outgrowers was estimated to be 17,691 tCO2e, or 1.72 tCO2e/ha and 0.07 tCO2e/tonne of FFB produced

- Emissions calculated form the mill was 5603.82 tCO2e from POME, 772.36 tCO2e from fuel con-sumption, and -47025.26 for sale of PKS. Total mill emissions was calculated to be 9783.93 tCO2e or 0.03 tCO2e/tonne of FFB produced.

- Overal Final emissions value per product was determined to be 0.47 tCO2e/ tonne of CPO product and 0.47 tCO2e/ tonnes of PK product.

Compliance status: Full compliance




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Criterion 6.1: Aspects of plantation and mill management including replanting that have social impacts are identified in a participatory way, and plans to mitigate the negative impacts and promote the positive ones are made, implemented and monitored, to demonstrate continuous improvement. Findings: The company has Approval of Decree UKL and UPL for Estate and Mill PT MSS number 660 / Bapedalda / 319/2002 date September 14 th 2002, and report of Social Impact Assesment (SIA) owned by PT Murini Samsam , conduct by Re.Mark, for assessment which was conducted on 14-18 April 2014. The report contains the impacts of the company to community, employee, and local government, and covers positive and negative impacts with evidence of participation of local communities and all affected parties.

The identifed impacts were as follows :

1. Economic Sector: Positive impact, i.e. there were increasing of income for farmers, traders, raising of shop and store, food store and traditional market. The negative impact included decreasing of land ownership at coastal area.

2. Socialcultural sector: Positive impact was occuring of assimilation in coastal villages and transmigration villages. It was changes from primary sector into secondary sector and tertiery. Occupation of time was more productive. Negative impact was the increase in human consumption and higher dependency on external food production.

3. Environmental: Positive impacts are not yet experienced by people. Negative impacts include river pollution, aridity, fire and fly dispersion.

4. Raising issues need to be address by management: - Communication and information system was not effective. - There was no clear information regarding to plasma development. - Pollution on the river by mill waste. - Fly dispersion related to mill waste. - Low of manpower from surroundung villages accepted by the company and working accident - Low education level - Minimum medical resources and health care infrastructure in the villages

The company has a list of attendees of meetings held with stakeholders around PT. MSS on April 17, 2014. In the report SIA PT MSS Chapter 6, there is a Management and Social Monitoring Plan. The purpose of the Social Monitoring and Management Plan is to provide guidance for the implementa-tion of the programs and / or activities of social management of the company so that its resources can be focused in a more focused, integrated and effective in achieving the company's social vision. In the context of the management of social impact and the development of relations with the communities, the programs of social management in the form of management activities to achieve the vision of social en-terprise are planned as follows: (1) management activities carried out in order to minimize the negative social impacts and / or social risks, as well as which can develop positive social impact, (2) Manage-ment of social impact involving the parties who have a direct relationship that the parties giving and re-ceiving impact, (3) Management activities conducted to strengthen social capital for social sustainability of society (social sustainability) and (4) Programs / activities carried out shall be taken into account as far as possible to have a direct relationship with the company's core competencies and business (core business). Recommendation management and social monitoring will be carried out by the company with consider-ation of time, human resources and costs. The management and monitoring plan will be communicated to interested parties as a tool for monitoring the implementation of activities that had been recommend-ed together. Monitoring and evaluation activities will also be carried out to obtain lessons learned as feedback for improvement and implementation of social management plan next period (continuous im-provement).




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While the basis for the preparation of a management plan social impact is also not solely based on the social impact but also based on the aspirations of the community in the form of suggestion or xpecta-tion, to create positive effects, and social risks of the parties affected by the presence and operations of the company. Social Monitoring and Management Plan is based on the results of the Social Impact Assessment stud-ies, recommendations for how to carry out the management and social monitoring by the company are presented in the Matrix for Management and Monitoring Plan. In accordance with the principle of social adaptive management, all management recommendations must come from the various parties involved in the management of the region where the company is located. The summary of the SIA management and monitoring plan is as follows: 1. Human Relations: The management plan and CSR program for improvement in health in coopera-

tion with the department of health - Extension and counseling pertaining to HIV, AIDS and sexual-ly transmitted diseases

2. Economics: Training on business areas according to the potential area, improving the relation-

ships with the surrounding community

3. Sakai tribe Management Plan: Briefing of the importance of education, in collaboration with the local educa-tion office , cooperation with the department of fisheries, completing the teaching and learning fa-cilities in Complex Project 10

PT MSS has not been monitoring the social impact of the results of the Social Impact Assessment Re-port in 2014, so there is no plan of improvement over the results of such monitoring if found discrepan-cies. However the SIA report does not explain the analysis of resulting social impacts if growers plan for re-planting. This was raised as an observation. During the assessment audit found no recorded special attention to the impacts of outgrower schemes because the company does not have cooperation with farmers or cooperatives. Hence this requirement is not applicable. Compliance status: Compliance with observations

Criterion 6.2: There are open and transparent methods for communication and consultation be-tween growers and/or millers, local communities and other affected or interested parties.

Findings: The Company has a Procedure for Communication, Consultation and Coordination with Stakeholders No. PRO-BM-007 Rev. 01 dated August 1, 2015. The SOP was created as a technical guide for im-plementation of communication, consultation and coordination between the company and stakeholders so as to be sure that every step of the decisions, actions, and implementation of activities related to the stakeholders is accountable, effective, efficient, consistent and systematic so as to facilitate the opera-tions of the company. Description of Procedures:

1. The management assesses the feasibility of the inputs from the stakeholders and shall prepare a response to be communicated, consulted and coordinated with stakeholders,

2. If requested, the company protects the confidentiality of the identity of depending on the sensitivi-ty of the issue, the scale of the impact if the issue is published or the risk of retaliation.

3. Management of public announcements intended to respond to input or to seek the fulfillment of the company's operational support to external parties

4. A communications team shall provide input to upper management to analyze operational support




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needs and formulate the content of the form of communication, consultation and coordination to-gether as a form of corporate policy, management

5. Management approve or revise the formulation of the form and content of communication, consul-tation and coordination

6. The communications team performs the function of communication, consultation and coordination in accordance with the development policy that has been decided and reports the results of communication, consultation and coordination to management.

There are records of communication, consultation and coordination activities held with stakeholders. Available Decree No. 171 / KEBON-MSS / IX / 2014 dated December 12, 2014 which was passed by the company management on the establishment of the Public Communications team of PT. Murini Samsam appoint and define: 1. Priadi and Arismardi and J. Siagian as a Communications teams leaders for PT MSS 2. Indasril as a team chaperone field of employment. 3. Indasril as chaperone field of Community Development. 4. Hirasman Tanjung as a chaperone field of environment and K3. 5 Irwansyah and Beni Safari as a team chaperone field Mill / Factory

The communications team is responsible for: 1. Analyzing stakeholder input or operational support needs of the company and formulating the

form and content of communication, consultation and coordination that will be presented to stakeholders

2. Confirming the formulation of the form and content of communication, consultation and coordina-tion, to management

3. Running the function of communication, consultation and coordination, according to the type of input or operational support to meet the needs of companies

4. Reporting the results of communication, consultation and coordination to management The company has a list of stakeholders (Entry List of stakeholders) consisting of 1. Stakeholder areas of government: the District, District, village / hamlet. 2. Stakeholder Indigenous People / Density Adat (KAN) Region District of Uptown 3. Non-Governmental Organization (NGO) and related organizations 4. Company Core Institutions Cooperative Organization Partners 5. Suppliers of Raw Materials (FFB) 6. Contractor supplying to the Company 7. Supplier / General material Suppliers & Service Compliance status: Full compliance

Criterion 6.3: There is a mutually agreed and documented system for dealing with complaints and grievances, which is implemented and accepted by all parties. Findings: PT MSS already have procedures Communication, Consultation and Coordination with Stakeholders No. 007Rev PRO-BM-01 dated August 1st 2015 with the aim of: System Operating Procedures created as a technical guide implementation of communication, consul-tation and coordination between the company and stakeholders so as to be sure that every step of the decisions, actions, implementation of activities related to the stakeholders accountable, effective, effi-cient, consistent and systematic so as to facilitate the operations of the company , Description of procedures: 1. The management assesses the feasibility of the inputs from the stakeholders and shall prepare a re-

sponse to be communicated, consulted and coordinated with stakeholders, 2. If requested, the company protects the confidentiality of the identity of depending on the sensitivity of

the issue, the scale of the impact if the issue is published or the risk of retaliation.




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3. Management of public announcements intended to respond to input or to seek the fulfillment of the company's operational support to external parties

4. A communications team shall provide input to upper management to analyze operational support needs and formulate the content of the form of communication, consultation and coordination together as a form of corporate policy, management

5. Management approve or revise the formulation of the form and content of communication, consulta-tion and coordination

6. The communications team performs the function of communication, consultation and coordination in accordance with the development policy that has been decided and reports the results of communica-tion, consultation and coordination to management.

During this audit, there were not cases of ongoing disputes; hence there were no records of results of the dispute settlement process. Compliance status: Full compliance Criterion 6.4: Any negotiations concerning compensation for loss of legal or customary rights are dealt with through a documented system that enables indigenous peoples, local communi-ties and other stakeholders to express their views through their own representative institutions. Findings: PT MSS has an SOP on Land Acquisition, i.e. PRO-BM-001 dated November 1, 2013. The SOP is defined as the standard procedure used to ensure that the decision or action in the pro-cess of land acquisition for the benefit of industrial oil palm plantations is done properly and correctly in accordance with the rules and laws and regulations that apply specifically to land-related interests of the community and communal/ customary land. There is a clause on • Information or land acquisition plan submitted to the relevant parties, among others, Local Govern-

ment, Public Social Institutions, Traditional institutions and public figures related to customary law • Inventory and field research that describes the location to be acquired by way of a special coordina-

tion with indigenous community leaders / village and with the village administration • Payment of compensation of land owned by indigenous communities / villages where a compensa-

tion fund is prioritized for the sake of social or infrastructure development for the village in accord-ance with the agreement stipulated. For arable land / group with compensation for destroyed crops, indemnity done for and on land / land and for crops or in the form of compensation expense over the process of cleaning / clearing will be done for the previous land owner.

The contents of these procedures include:

I. The Basic Law II. Status of Soil / Land to Backup III. Land acquisition policy IV. Implementation of land acquisition 1. Phase Research, verification and inventory data / facts 2. Phase compensation fund Filing / land acquisition 3. Phase research / verification of payment documents 4. Phase payment of compensation / damages 5. Phase Document Storage

During this audit, there have been no parties identified who are entitled to receive compensation for the concession company land and no compensation claims in progress. Compliance status: Full Compliance

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




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Findings: There are a list of wages of employees of PT MSS. The payment of wages is in accordance with:

1. Regulation of the Governor of Riau No.Kpts 244 / III / 2015 2015 Minimum Wage Sub Sector Ag-riculture / Plantation Oil Palm and Rubber Plant amounted Rp.2.125.000, - dated March 31, 2015

2. Internal Memorandum No. 001 / HRGA-IM / IV / 2015 dated April 1, 2015 which states the mini-mum wage per employee Daily 01 January 2015 is set at Rp. 2.1255 million, -, / month or Rp. 85 020, - / day.

Based on the evidence recorded paycheck in September 2015:

1. Sample pay slip of employee paid Daily Fixed Basic Salary of Rp. 2.1255.000, - the Take Home Pay Rp.2.492.567, - after deducting the Social Security contributions, PBJS and others

2. Sample pay slip of employee paid Daily Release Basic Salary Rp. 85.000, - per day 3. Sample pay slip of employee in Admin Position MCC PT MSS Basic Salary Grade 2B

Rp.1,786.625, - fixed allowance of Rp 672 332, - so Total Wages: USD. 2,458,957, -

There is a list of payment of wages of employees of PT MSS Estate Month in October 2015 consisting of 227 employees. The estate has a documented book on PT MSS Company Regulations (for Estate) in 2014 to 2016 which is in accordance with the Decree Ka Manpower and Transmigration Bengkalis District Number: 41 / KPTS / DTKT-PHIJ / 2014 regarding the Company PT Murini Samsam Regulation, which was signed by the Head of Department of Labor and Transmigration Bengkalis on 10 September 2014. Evi-dence of briefing of the company regulations to employees in PT MSS estate was done on September 16, 2014, the location of the meeting room PT MSS, Mr. Indasril carrier content, and number of partici-pants: 20 people A book of PT MSS Company Regulations (for Palm Oil Mill) 2015-2017 is also available and prepared in accordance with the Decree of the head of the Department of Labor and Transmigration Bengkalis District Number: 26 / KPTS / DTKT-PHIJ / 2015 on the Company PT Murini Samsam Regulation, which was signed by the Head of Department of Labor and Transmigration Bengkalis on 13 April 2015 Evidence of briefing of Company Rules for Employees of the palm oil mill by distributing of Pocket Book of Company Regulation period 2015 - 2017 to each unit were sighted in records of briefing as follows: 1. Administrative staff: attended by 25 people was conducted on June 23, 2015. 2. Process workers: A total of 35 people attended conducted on 24-25 June 2015 3. QC / Labour: attended by as many as 9 people conducted on 23-27 June 2015 4. Maintenance workers: was attended by 19 people conducted on 23- Date June 2015 5. Sortation workers: attended by as many as 19 people conducted on June 24, 2015 6. Security personnel: was attended by 18 people conducted on 23-29 June 2015 7. Employees at Process B was attended by 36 people conducted on July 2, 2015 PT MSS has a list of facilities and infrastructure for employee benefits such as: Mess G1, Housing staff, Emplastment Housing, Housing Employee, Hall, houses of worship, mosque, soccer field, volleyball court, a daycare, and school bus which are all in good condition. Housing employees get clean water from wells made by the company, the source of the water has been laboratory tested to ensure that the water was fit for consumption employees. During the dry season there is difficulty in water supply, so the company provides water to the homes of each employee. The plantation and mill area are near the market so it is easily accessible by employees for access to de-cent food, reasonably, and at an affordable price. There is available a labor agreement with the contractor: SPK No. 034 / SPK-MSS / X / 2014 dated Octo-ber 8, 2014 between the management of gardens with Basma Adam Lopez CV Tuah Monex Jaya hamlet Sukamaju Village Edge, type of work Preparation 1 housing unit type G-10 (10 doors) size of 510 m2, a period 90 working days since the signature of the contract. Stated under Clause in Article 6 of the agree-menty in paragraph 3 that the second party is solely responsible for the terms of employment are regulat-ed in labour law and OSH and environmental agreement between the company and the contractor regard-




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ing compliance with OSH and the environment laws and regulations to contractor. Proof of payment is available to resume work Monex Tuah Jaya dated August 15, 2014. Performance evaluation documents for subcontractors (FM-GEN-042) are available and were conducted on all sub contractor PT MSS in 2015, for example: Subcontractor Performance Evaluation Monex CV Tuah Jaya was done on August 1, 2015 for the work of constructing the child care centre. One of the evaluation items under no. 3 is regarding completeness and feasibility of human resources / equipment which was graded as 10, while the use of PPE scored 8. At the mill, there is also available agreements with the contractor: SPK No. 001 / SPK / MSS-POM / V / 2015 dated May 1, 2015 between the MCC with CV Dwi Jaya Lestari Jaya for work on Blowdown Cham-ber addition, with working period of 20 days after the employment contract. Section 4 describes the fulfill-ment of the provisions of article 8 of the Labour work fulfillment of OSH and the environment. Proof of payment date of June 10th, 2015 with the transfer receipt from the bank to the account of CV Dwi Jaya Lestari. Performance evaluation documents are available for subcontractor (FM-GEN-045) which were all con-ducted on all sub contractor PT MSS MCC in 2015, for example: Subcontractor Performance Evaluation of CV Dwi Jaya Lestari was conducted on June 9, 2015 for the work of addition of Blowdown Chamber. Evaluation item No. 3. Regarding completeness and feasibility of HR / equipment owned was graded as 85%, while item no. 6 regarding discipline on the use of PPE scored 8, for total value of 87%. Compliance status: Full C ompliance Criterion 6.6: The employer respects the right of all personnel to form and join trade unions of their choice and to bargain collectively. Where the right to freedom of association and collec-tive bargaining are restricted under law, the employer facilitates parallel means of independent and free association and bargaining for all such personnel. Findings: Provisions governing the existence of worker unions are described in Internal memo from Human Re-sources Development Head No. 001 / WIP-HRR / Intl-II / 2014 dated February 20, 2014 regarding la-bour. The policies outlined in the memo include where the company guarantees every employee the freedom to form and join trade unions or union in accordance with the applicable legislation. That Estate and Mill currently no longer have a union, according to information on the results of inter-views with employees of PT MSS and the Vice Chairman, the employees do not feel there is a benefit to the establishment of Worker unions and the board does not can no longer take care of this union, so that the organization is dissolved with the agreement of members and the company instead established a bipartite system which then resolve the problems that exist. Based on interviews with some workers still want the formation of unions so that their rights are pro-tected. The company should cooperate with the employee for the re-establishment of a Worker Union. Compliance status: Compliance with observations Criterion 6.7: Children are not employed or exploited. Work by children is acceptable on family farms, under adult supervision, and when not interfering with education programmes. Children are not exposed to hazardous working conditions. Findings:

Regarding to working children, there was company’s policy in circular no. 002/GM-RMM/IV/2014 for worker protection and prohibiton, valid since 11 April 2014. In this circular it was stated as follow :

1. The company only accepts adult worker (18 years minimum age or married). 2. Workers are prohibited to bring children to work. 3. Children between 13-15 years old are allowed to do light work as long as not interfere his

physical, psychological and social development. 4. Estate divisions which accepts this kind of working children as point 3 above shall be accompa-

nied with requirements as below :




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- Written permit from parrents. - Working agreement between company and parrents. - Longest working hours is 3 hours per day. - Environment condition do not interfere with his physical, psychological and social

development and school time.

The company has list of workers for 2014-2015. From this list it was found that all workers are more than 18 years old. There was no worker under aged or between 13 and 15 years old. So, there was no worker currently that needs to be accompanued with written permit from the parrents. Based on interview and observation in the field found that the company complies to regulations regarding worker’s minimum age. Compliance status: Full Compliance

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

Findings: Available Policy on Equal Opportunities -Wilmar International endorsed by Goh Ing Sing (Group Plan-tation Head) on September 2010 which supports the principles of fairness and non-discrimination, and aims to treat each person with respect, be free from unlawful discrimination and work ethically. The aim is not to discriminate against gender, caste, ethnicity, disability, sexual orientation, age, or beliefs but to develop a global workforce that has abilities to perform assigned tasks based on an objective assess-ment. Internal Memorandum No.001 / WIP-HRR / Int-II / 2014 Conditions of Employment dated 20 February 2014 on Equal opportunities for employees "The company upholds professionalism and ensure the ab-sence of discrimination on the basis of race, color, gender, religion, political beliefs , nationality, or origin of which results negate or reduce equality of opportunity or treatment in employment or occupa-tion.” Evidence of equal treatment in working opportunities for workers could be seen on worker list which shows that all workers come from different race, nation, gender and religion. Based on interview and fielld observation it was found that there was no discrimination to the worker regarding to this opportunity Based on the list of employees in October 2015 Estate: Number of employees 227 people, employee list contains the following information: Name, occupation, sex, class, tenure, identification card number, place of birth, date of birth, place of origin of labor, family status, religion, ethnicity, education. Ratio comparison of the number of workers Men and women are: 182 workers Men: 45 female workers (80.2%: 19.8%). Ratio comparison of the number of workers coming from Malay (Native) only amounted to 4 people, the majority of labor originates from the tribe of Batak, Javanese, Minang. Mill: Number of Employees 157 people, where employee list contains the following information: Name, Divi-sion, department, section, class, work start date, gender, marriage status, date of birth, level of education, religion. Ratio comparison of the number of workers with are men and women are: 150 workers Men: 7 female workers (93.5%: 4.5%). Ratio comparison of the number of workers coming from Malay (Native) only amounted to 4 people, the majority of labor originates from the tribe of Batak, Javanese, Minang. Based on the results of the study documents the company has adequately implemented their policy on equal employment opportunities. Compliance status: Full Compliance




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

Findings: There is a company policy on Sexual Harassment, Violence Abuse and Reproductive Rights, which was ratified by the GPH Goh Ing Sing (Group Plantation Head) up date in June 2014 which states that Wilmar International strives to create a conducive working environment characterized by equality and mutual re-spect. For that purpose, a sexual harassment policy was developed to encourage reporting of all events of sexual abuse experienced by each individual with no exception of gender and age as a result of his ties with the company. The policy is supported by the Internal Memorandum No.001 / WIP-HRR / Int-II / 2014 regarding Condi-tions of Employment dated 20 February 2014 on the Employment Provisions point 4. Prevention and Suppression of Sexual Violence Against Women: With the principle of unity of rights and obligations of each worker to the protection of health and safety, morals and decency, treatment in accordance with the dignity manuasia and religious values, all employees are required to maintain decency and safety while at work and prohibit any element of sexual harassment and oppression of women. It is stated in the Policy on Sexual Harassment, Violence Abuse and Reproductive Rights, that repro-ductive rights are legal rights and freedoms related to reproduction and reproductive health for which an individual is: a. To decide freely and be responsible to, age, distance, and number of their children b. To make a decision regarding reproduction which shall be free of discrimination, coercion and vio-lence? The rights of women workers at PT. MSS are guided by the vision and mission as well as Law No. 13 of 2003 on Labour, it is hereby informed that for women workers: 1. During the menstrual period. It is the obligation of each employee to ensure the protection of women workers from the menstrual period pain based on company notification and medical certificate, women during their periods are not obliged to work on the first day 2. Pregnant and breastfeeding women. In connection with pregnant and lactating women workers who are at risk of contamination of their infant / child or impact trauma to the fetus in pregnant women. They are forbidden to be employed for all types of jobs related with chemicals (pesticides spraying, fertiliza-tion, work in the warehouse of chemicals, etc.). Women workers in question should be moved / trans-ferred to temporary work to the types of work where they are not at risk of contamination and impact. 3. Maternity leave. The company uphold the laws in force, in which the company 'prohibits the employ-ment of pregnant women workers by giving maternity leave for 1.5 months before the time of delivery and 1.5 months after giving birth, according to calculations by the obstetrician or midwife. For women workers who had a miscarriage, they are entitled to 1.5 months leave in accordance with the certificate from the obstetrician or midwife. A gender committee has been established recently, which consists of head of committee, secretary, and members. The function of this committee is as an official institution for the worker to report any case of sexual harassment or violence against women experienced The organizational structure of the Gender Committee could be improved further to include representa-tives from all areas of employment, while counseling and training pertaining to women's rights should be carried out. This was noted as an observation. There are records of a briefing done by the gender committee dated 20 April 2015 at PT MSS estate, Block O11 with participantion of 23 employees. The agenda of the meeting was to discuss the briefing committee of gender while explained the functions and duties of the principal one of which is to dis-seminate information to all women workers in company, providing explanations and knowledge of legis-lation relating to sexual violence. Documentation on gender committee briefings conducted are availa-ble. There are also records on briefing on Reproductive Rights for 174 employees at PT MSS estate done on 5 November 2015. There are records of the Gender Committee's work program in year 2015, which includes the program




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on: 1. Briefing on the Gender Committee and prevention of sexual harassment for employees of the estate 2. Briefing on the Gender Committee and prevention of sexual harassment for employees of Mill 3. Briefing on Reproduction Rights 4. Documentation of gender committee meetings every month Sample completed forms for maternity leave taken from the date of December 1, 2014 - March 1, 2015 using the application form Leave (FRM-HRD-002) and approved by the head unit estate were sighted. Women workers are also permited to leave work to breastfeed as seen from sample completed forms dated 02 October 2015. Breastfeeding breaks are permitted from 09:45 am to 09:55 am and 14:45 pm until 14:55 pm. Should Form breastfeeding employee has permission list number, date of issue, date of revision so that a company official form. The register form for list of breastfeeding women workers should be revised to include a document number, date of publication, and revision date such that is be-comes an official company document. Compliance status: : Compliance with observations

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

Findings: The price of FFB is decided by the company management. Example prices set are as follows: - On 1-2 October 2015, the price was set at Rp. 870 / kg - From September 3 - October 2015, the price was set at Rp. 890 / kg - Up to the time the audit ended on November 5th 2015, the price was set at Rp. 1,050 / kg

There was mechanism for price determination which is done according to SOP no. SOP.Dir.MKT-01 where prices are subject to pricing flowchart mechanism as follow :

1. Analysis of CPO and kernel market biding price which is affected by several parties such PT Kharisma Pemasaran Nusantara, Astra Group, Malaysia market effect, and State Plantation Division of Sumatra Utara Province

2. Analysis of price of FFB from competitors.

3. Analysis of last FFB purchase price The company also has an FFB purchasing procedure No. 001 / TBS-SOP / VIII / 2015 dated August 10, 2015, for purchase of FFB from external parties. This SOP is to ensure that FFB purchasing activi-ties are conducted properly and are verifiable in terms of continuity, time and the quality of palm fruit were purchased and to ensure no errors or deviations in the purchasing activities of FFB. The SOP stipulates the following: FFB Purchase Price: 1. Purchase of FFB should be guided by the Cost of Purchasing of FFB with regard to overall market conditions 2. If the purchase price exceeds the cost of processing of FFB, then the purchase transaction is sub-ject to approval by the Head of Commersial. Calculation of Cost of Purchase: 1. The calculation is done every day by the logistics section at the district office. 2. Calculations on cost of purchasing are guided for purchase of FFB based on data on CPO price / PK, processing costs, yield, and freight into the computer formulations that have been set and con-firmed. 3. The results of calculation of the cost of purchasing are informed to the Operations Department of the Office of the region on the same day. Sighted a sample contract purchase agreement TBS No. 003 / MSS-MCC / TBS / I / 2015 dated 2015 02 January between the management of PT MSS with the FFB supplier, Pahala Efendi Pandiangan




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owned by SP Brother Sungai Meranti. The supplier provides FFB supply in accordance with the provi-sions of the company's criteria, namely Quality Standards for FFB as follows: 1. FFB sent are ripe, not rotten and do not consist of empty husks 2. FFB bunches each weigh 8 kg and above 3. The FFB stalks do not exceed 3 cm PT MSS mill will make payments less than 3 (three) days after delivery and the agreement is valid for 12 months. Sighted evidence of payment for deliveries done on 27-31 October 2015 for as much as 38,916 kg x Rp. 1,131, or Rp. 44,013,996, while for FFB delivered on 2 November 2015, payment was as much as 12,543 kg x Rp. 1,131, or Rp. 14,186,133. FFB sent to Mill should have a guarantee of legality issued by the supplier as a guarantee that the FFB was not derived from plantation forest encroachment. Mill PT MSS verified this with the supplier through working visits and requesting suppliers to fill out working visit forms with contains the following required information: name of the supplier, the location, the coordinates, year of planting, yield esti-mates, notes legality, recommendation. Compliance status: Full Compliance

Criterion 6.11: Growers and millers contribute to local sustainable development wherever appro-priate.

Findings: Available Program and Budget records CSR MSS 2015 such as: 1. The provision of 2 units of computers to SMU 1 Basung Muara District as Rp. 10,000,000, - 2. The provision of infrastructure and facilities Musholla Worship Police Station Sukamaju Pinggir dis-trict worth Rp 10,000,000, - 3. The provision of nine basic foodstuffs to the Regional SP 10 (Sakai tribe) Sam-sam river bank as much as Rp. 5,000,000, - Other CSR activities in year 2015: Estate: 1. The provision of soil compacters to SDN 20 Uptown district on 23 September 2015 2. Provision of bricks of 7,000 pcs to Madrasyah School (MI) YLPI Mujahideen for the construction of school toilets on September 1, 2015 3. The provision of a loan of heavy equipment for road repair new village RW RT 007 002 Pangkalan Libut village on 28 September 2015. 4. Assistance for the construction of the Darul Hikmah mosque Hamlet Sukamaju Sei Meranti. 5. Provision of lending heavy equipment to clean up the site office Pangkalan Village Head Libut on 12 September 2015. Mill: 1. Provision of 10 bags of cement for the construction of the mosque of Mujahideen on March 6, 2015 2. Granting 1 piece signpost for use in the Office of BPD Sungai Meranti Uptown district on 14 April 2015 3. Provision of one set of volley poles for sports activities in rural water Pamessi Betuah Pinggir district dated May 4, 2015 4. Help for renovation of Traffic Police Station at Pangkalan district Libut district Pinggir dated June 5, 2015 with provision of Rp. 4.972 million, - 5. Help providing clean water to communities in drought in the base village libut district Pinggir on Sep-tember 4, 2015 6. The provision of one head of cattle for sacrifices in the village worth Rp.12.170,000 on 23 September 2015. 7. Borrowing heavy equipment for road improvements along the 1 km in water hamlet at Pamesi District Pinggir on 19 October 2015. Compliance status: Full Compliance




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Criterion 6.12: No forms of forced or trafficked labour are used

Findings:

As confirmed from interviews with workers on-site and sample checks of work contracts, there is no evi-dence of illegal labour being used and no evidence of contract substitution. All manual labourers are local with no foreign labour employed. Compliance status: Full Compliance

Criterion 6.13: Growers and millers respect human rights

Findings: Wilmar Group has a Human Rights Policy which states the following: Wilmar Int Limited, as Asia's leading agribusiness group conducts its business responsibly and ethical-ly. Wilmar aims to respect and protect the human rights to personal security free from harassment or abuse of any kind, safe, clean and healthy workplace and environment.

1. Human Rights in WILMAR includes two key aspects, which are: a. The rights of workers a. Freedom of association b. There is no forced or bonded labor c. No child labor d. Working conditions shall be conducive 2. Rights of Indigenous and Local Communities a. To respect the rights of land ownership b. Committed to Free, Prior and Informed Consent (FPIC) c. Committed to an openness, transparency, and fairness in resolve conflicts.

The Human Rights Policy is made as it placed on the notice board at the office of the estate and office mill for easy viewing by workers and other stakeholders.

Compliance status: Full Compliance

Principle 7: Responsible development of new plantings

Findings: This principle is not applicable as there have been no new plantings carried out by the company. The youngest planted area was in year 1996, with no areas planted since. Compliance status: Not applicable

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

Findings: The company has developed plan to reduce chemical usage, environmental impacts, to reduce and properly manage waste and to reduce pollution and emissions, as seen in their Waste Identification and Management Plan for year 2015 (see further details under CR5.3) and Management and Monitor-ing Efforts Matrix for Mitigation of Greenhouse Gases in year 2015 (see further details under CR5.6). The company has plans to build a methane capture plant in 2016.




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The company also carried out reporting on implementatin of their UPL/UKL document to the local envi-ronmental department once every 6 month, in accordance with local legal requirements. The latest re-port for Semester 1 of year 2015 for the estate was sighted, with evidence of distribution and receipt by the local environmental department and plantation authoritative body of Bengkalis on 3 September 2015. The report includes an update on various activities carried out by the estate to reduce environ-mental impacts in areas such as fertilizer application, pest management, waste management, security, office and housing operations, and workshop. Other aspects reported include ambient air quality, groundwater quality, waste collection, water biota sampling and analysis, road damage, social econom-ic aspects such as hiring of workers and FFB and EFB transport (which can impact water and air quali-ty), as well as impacts to community health due to fertilizer application, and FFB and EFB transport. For each of the areas above, monitoring activities are also conducted and reported to determine effec-tiveness of activities conducted. The mill also carries out reporting on UPL/UKL activities once every 6 months as seen from the latest report for Semester 1 of year 2015 and the report of implementation for Semester 2 of year 2014. The implementation report includes results ambient air quality, boiler emission quality, palm oil mill effluent quality, soil quality of land application area, noise levels, and scheduled waste production records. The environmental management and monitoring activities covered in the report include: A) Waste management: EFB and shell B) Decrease in Air Quality:

- Emissions from machines: Vehicles, boilers, generator, and production machines - Ambient aitr: Boiler, genset, mill machinery, vehicles - Noise: Process, sterilizer, boiler, genset, engine room, mill machines

C) Decrease in water quality - Mill effluent: effluent ponds and land application - Domestic liquid waste: domestic office activities - Hazardous wastes: workshop and maintenance

D) Impacts to road - Dust: loading ramp, lifting and mobility

E) Biological compponent - Impact to flora and fauna: Mill operational activities

F) Social, economic and community health component - Job opportunities and business opportunities

G) Environmental health: Mill operations Results monitoring and test certificates of analysis carried out are reported in the UPL/UKL reports ac-cordingly. In addition, PT Murini Samsam estate has a documented Environmental Improvement Plan for year 2015, which covers activities to reduce domestic waste separation, and HCV management and monitor-ing. The program is updated monthly to indicate status of activities carried out and the estate also has a form for monitoring of achievement of objectives and targets. The estates has program to reduce pesti-cide usage and other restricted agrochemical materials. The mill also has an additional documented list of Environmental Objectives and Targets for year 2015, including progress of implementation. The list includes activities for improving environment management by reducing usage of fossil fuels to 0.79%/tonnes FFB, maintain water usage at 0.184 m3/tonnes FFB, and prevention of pollution resulting from spillage of mill effluent to the field through regular pond clean-ing distribution for land application, installation of underflow pipes from pond 6 to pond 7 and regular housekeeping. The mill must continue to ensure these activities are implemented as it was observed in the field that the effluent ponds were near overflowing levels after only one day of rain. This was noted as an observation. Compliance status: Compliance with observations




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• RSPO Supply Chain Certification System (SCCS) The company has opted to be certified against SCCS requirements Module E for CPO Mills: Mass Balance. The findings pertaining to implementation of the standard are described below.

E.1. Definition Findings: PT Murini Sam-Sam Palm Oil Mill (POM) receives FFB from their own company-owned estate, i.e. PT MSS Estate and from third party independent suppliers which are not within the certification scope. As 466 ha of the estate is also not within the certification scope as the HGU for this area has not been re-ceived by the company, the mill is only claiming for certified FFB received from 967ha of the estate. Compliance status: Full compliance E.2. Explanation Findings: The estimated tonnage of CPO and PK products that could potentially be produced by the certified mill has been defined under table 3 of this report. As verified during this certification audit, the estimated certified tonnages based on actual production from the approved HGU area of PT Murini Sam-Sam es-tate is 4,333.88 tonnes of CPO and 1,089.62 tonnes of PK. The mill has not yet registered to the RSPO IT platform as they are still not certified and have not car-ried out any transactions yet. Compliance to registration and reporting requirements through the RSPO IT platform will hence only be checked during the next surveillance audit. Compliance status: Full compliance E.3. Documented procedures Findings: The mill has documented procedures for supply chain as follows: 1) SOP Supply Chain - Mass Balance SPO-LOG-005 dated 1 June 2014, revision: 02 2) SOP Traceability SCCS - SOP-LOG-006 dated 5 November 2015, revision:003 The SOPs above covers procedures for receiving and processing certified and non-certified FFBs. The mill’s supply chain procedure for Mass Balance defines the responsible mill personnel to implement the Supply Chain certification system and their responsibilities, e.g.: - Mill security is responsible to record all receipt and despatch of certified sustainable palm oil

(CSPO)/ non-certified sustainable palm oil (NCSPO) and certified sustainable palm kernel (CSPK) / non-certified sustainable palm kernel (NCSPK).

- Weighbridge is responsible to record the weight of all FFB received and despatched, and ensure all FFB received and report on despatch of CSPO/NCSPO and CSPK/NCSPK is in accordance with the RSPO SCCS and ISPO requirements

- Logistics is responsible to calculate production of CSPO/NCSPO and CSPK/NCSPK, despatch and to report this data in production and despatch reports and traceability report

- Sortation is responsible for FFB grading and ensuing grading reports for FFB sorted are prepared - Senior Admin Offer is responsible to control the receipt of FFB, CSPO/NCSPO and CSPK/NCSPK,

FFB receipt reports, despatch, CPO delivery reports and traceability reports - The Mill Manager is responsible to ensure to the overall process The mill’s SOP for tracebility is similar to the mass balance procedure, and includes additional re-quirements to prepare a traceabilility report to the mill manager. Logistics is also responsible to carry out stock closing/balancing in e-Trace once a month, in coordination with the Sustainability team based in Jakarta. It was noted during the audit that the SOPs did not define ensure how crop from certified blocks with approved HGU would be differentiated from non-certified blocks which are not within the certification scope. The mill took immedate action to revise the SOP for traceability with additional information that




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the logistics personnel is responsible to ensure that delivery notes of FFB received from certified es-tate blocks are appropriately stamped as ‘sustainable’, and that those that are stamped are listed in the mass balance sheet as certified FFB. The mill has nominated the Senior Admin Officer as the management representative for overseeing the implementation of the entire supply chain process and as well the person-in-charge for traceability, as seen from letters dated 6 September 2014 issued by the Mill Manager There is evidence of training done for the mill personnel responsible for implementation of the Supply Chain Certification System, as seen from training record on P&C RSPO 2014, SCCS 2014 and ISPO requirements dated 9 September 2015. The record included a summary of training topics, including:

- The background of RSPO P&C and SCCS, - The supply chain options, with focus on Mass Balance, - Required documents in order to comply with the RSPO Supply Chain Standard, pertaining to

receipt of raw material and despatch of material - Outsourcing activities - Claims - Training

Attendance list of the training showed that there were 9 participants, including the mill manager, Senior Admin Officer, personel officer, EHS officers, and sustainability officers. However the training did not include all personnel responsible for the implementation of the SCCS system, such as personnel at weighbridge, logistics, and sortation. The mill took immediate action by conducting a briefing on 5 No-vember 2015 for 14 personnel, including weighbridge operators, logistic officers, sortation, security, process, admin staff and EHS officers. The briefing also included an explanation on the updated made to the SOP for traceability regarding to stamping of delivery orders of FFB received from certified es-tate blocks. The estate also has SOP for FFB Transport – PRO-WSH-0022 dated 1 January 2014, revision 001, which is applicable in the SCCS implementation as the estate is responsible to ensure that FFB from HGU approved blocks and non-HGU blocks are correctly identified as sustainable and non-sustainable respectively prior to being sent to the mill. During the audit it was noted that it had not yet specified how the estate would ensure crop from certified blocks with approved HGU would be differentiated from non-certified blocks which are not within the certification scope. The estate management took immediate action to revise the procedure, and the revised procedure stated that that estate security is required to stamp the FFB Delivery Notes for all crop from certified blocks no. 004, 005, 006, 007, 008, 010, 011, 012, 013, 014, 015, 016 and 017 as sustainable, while those received from non-HGU blocks, i.e. blocks 001, 002, 003, 004B, 005B, 007B, 008B, 009B, 010B, and 011B are not to be stamped. A briefing was immediately conducted by the estate on 5 November 2015 for 17 estate personnel re-sponsible for stamping of delivery notes from sustainable and non-sustainable blocks, i.e. security, transport clerk, FFB transport drivers and mandores. The stamps to be used by the estate for indicating sustainable crop and for the mill to indicate mass balance status of certified CPO and PK is still not available and only will be prepared after the compa-ny has received their RSPO certificate so that the certificate number is indicated on the stamps. This will be verified during the next surveillance audit. Compliance status: Compliance with observations E.4. Purchasing and good in Findings: The mill’s procedures for verifying and documenting the volumes of certified and non-certified FFBs re-ceived is as described in their SOPs for Mass Balance and Traceability as explained in E.3 above. All data on FFB received from certified and non-certified sources and CPO & PK despatched is recorded in a daily basis in a Daily CSPO Production Record, which is then summarized in a monthly basis in an excel template (mass balance sheet) for CPO Products Daily and Monthly Movement Summary Re-port. The current mass balance sheet template has not yet been used since the mill has not yet been certified. As seen from the template, the data required to be input, included FFB received from the es-tate’s HGU area (certified), non-HGU area (non-certified) and outsiders (non-certified), FFB processed,




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CPO production, OER, non-sustainable and sustainable production, non-sustainable and sustainable despatch, non-sustainable and sustainable stock and total stock. The mill has a documented procedure, i.e SOP-LOG-007 regarding Information on Projected Overpro-duction. The procedure specifies that the mill is required to report to the certification body if there is any overproduction of certified material beyond the specified certified tonnages. Compliance status: Full compliance E.5. Record keeping Findings: The site has established a mass balance sheet for CPO Products Daily and Monthly Movement Sum-mary Report in which the format requires that all receipts of RSPO certified FFB and deliveries of RSPO certified CPO and PK is recorded and balanced on a three-monthly basis As the mill does not carry out palm kernel crushing, there are no sales of palm kernel oil from the mill. It is specified in the mill’s SOP for traceability, SOP-LOG-005, that the site can only deliver Mass Bal-ance sales from a positive stock. As there are no transactions of CSPO done by the mill yet, implemen-tation will be verified during the next surveillance audit. The mill does not outsource activities to an independent (not owned by the same organization) palm kernel crush. Compliance status: Full compliance

3.2 Identified Non-conformances, Corrective Actions Taken and Auditors Conclusions A total of one (1) nonconformances were identified during the main certification assessment. These consisted of no major non-conformities and one (1) minor non-conformity. The company has taken corrective action against the non-comformance raised, and implementation of the minor non-conformities will be assessed dur-ing the next surveillance audit. A summary of all identified non-conformances, corrective actions taken and auditor conclusions is as below:

• RSPO Principles & Criteria (P&C)

Indicator 1.3.1: There shall be a written policy committing to a code of ethical conduct and in-tegrity in all operations and transactions, which shall be documented and communicated to all levels of the workforce and operations.

Non-conformance 01 of 01 (Minor non-conformity): The company does not yet have a policy on ethical conduct prepared in the name of Wilmar Group. Correction: To follow up with the Human Resources Department who will publish the policy. Person-in-charge is the Sustainability Manager Corrective Action: To ensure the ethical conduct policy under the name of Wilmar Group is prepared and properly main-tained. Auditor Conclusions: Corrective Action plan was acc epted. Effectiveness of implementation to verified at next audit.




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• RSPO Supply Chain Certification System (SCCS) No non-compliances raised

3.3 Noteworthy Positive Components

No. Related clause

Observations / Opportunities for improvement

1. - Good commitment from company for to comply with RSPO requirements observed throughout the audit, and staff was cooperative and efficient in providing documents for review.

2. 5.6 The mill has a plan to implement a methane capture project in year 2016 and has allocat-ed a budget for this activity

3. 4.7.2 A panel room for the generator operators is a good engineering measure to reduce noise exposure for genset operators in addition to the provision of the existing PPE.

3.4 Issues Raised by Stakeholders and Findings Pert aining to Issues Issues Raised during Stakeholder Consultation Meeti ng

No. Issues Raised Management Response Audit Verification

1. There is a problem of effluent discharged into the river. This problem is not only with PT MSS but with some other companies. This has caused a shortage of fish that die due to pollution

1. MCC Murini Sam Sam currently implements Land Application and is no longer discharging effluent into water bodies (river) 2. The company conducts regular monitoring in ac-cordance with the quality standards of effluent-wastewater 3. The company always regularly carries out maintenance and care of effluent treatment ponds so that they do not over-flow into the river

In was confirmed that the mill no longer discharges effluent and on-ly carries out land appplication. The mill conducts sampling of ef-fluent BOD5 (outlet pond no.6 and 7) with tests conducted externally (Unit of Technical Implementation for Materials Testing Laboratory. Riau Province Government). Sample results show (period of April 2014 to June 2015) that ef-fluent BOD5 for land application is below 5,000 pm as required in the mill’s land application permit No.156/KPTS/III/2011 dated 31 March 2011 which is valid for 5 years. However, it was observed in the field that the effluent ponds were near overflowing levels after only one day of rain. This was not-ed as an observation.

2. Request from several heads of villages, including the Suka Maju Village, Balai Pungut Vil-lage and Pangkalan Ribut Vil-lage: Request for the company to be more transparent about la-bour requirements and pro-vide job opportunities for local people from the outskirts of villages, e.g. manual labor in plantations. When there are vacancies, these should be made public in an open and transparent manner.

1. PT.MSS is currently hir-ing workers who live in the village of Sei Meranti and Pangkalan Ribut. It can be viewed from their ID cards that they are living in Sei Meranti Village and Pangkalan Ribut Village. 2. The number of workers who are currently hired is sufficient to meet the needs of the office and are in accordance with the work program.

It was found that the number of workers which are comprised of Malays (Natives) at the estate only amounted to 4 people, while at the mill, it was only 2 people. The majority of labour originates of the tribes of Batak, Javanese, Minang. They are domiciled and have ID showing that they live in the area around the company, which shows that the company does hire work-ers from surrounding communities. The number of people of whom they hire from each community is at the company’s discretion based on need and ability of the appli-cant to fulfil the job requirements.




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There used to be workers em-ployed from the nearby villag-es but after they made some mistakes, the company seemed reluctant to take on new recruits from villages

3. Please monitor youth issues, especially the Sakai youth with regards to lack of work oppor-tunities. We feel left out by the company.


It was found that the number of workers which are comprised of Malays (Natives) at the estate only amounted to 4 people, while at the mill, it was only 2 people. The majority of labour originates of the tribes of Batak, Javanese, Minang. They are domiciled and have ID showing that they live in the area around the company, which shows that the company does hire work-ers from surrounding communities. The number of people of whom they hire from each community is at the company’s discretion based on need and ability of the appli-cant to fulfil the job requirements.

4. The price of FFB purchased from outside suppliers of fruit should be increased. The price is always cheaper than other mills. Please pay a higher price than other mills, and the queue number should be prioritized for UNEDO Suppliers Price of FFB purchased from suppliers who come from far away is higher than the price of FFB purchased by suppli-ers located nearby. It is ex-pected that the price of FFB paid to suppliers located nearby should be the same as those from far away. The price of FFB increases and decreases based on the season and the difference in price is quite high

1. The price of FFB that we buy is based on quality of FFB and CPO market. 2. The queues will be main-tained to be in accordance with queue number provided to maintain order during re-ceipt of FFB 3. Purchase of FFB from suppliers located far away is a business strategy to in-crease the capacity of the mill. 4. Price of FFB is not based on the season, but consider-ing the field conditions and also the purchase price of competitors.

The company has an FFB purchasing procedure No. 001 / TBS-SOP / VIII / 2015 dated August 10, 2015 which defines procedures for purchases of FFB from external parties to ensure that FFB purchasing activities are conducted properly, are verifiable, there is continuity in time and the quality of palm fruit were purchased and to ensure no errors or deviations in the purchasing activities of FFB. The SOP states the following: FFB Purchase Price: 1. Purchase TBS should be guided by the Cost of Purchasing (HPP) which specifies FFB management with regard to overall market condi-tions 2. If the purchase price exceeds the HPP FFB preset by management, then the purchase transaction is sub-ject to approval of the Head of Com-mersial. Calculation of Cost of Purchase: 1. The calculation is done every day by the logistics section at the district office. 2. Calculation of the HPP is guided by FFB production, CPO/PK price, processing costs, yield, and freight and is calculated using computerized forumulations. 3. The results of calculation of the HPP on FFB prices is informed to the Operations Department of the Office of the region on the same day.

5. The company must provide a

'delivery order' which shows the 1. Suppliers can requested for

a recapitulation of total FFB The decision to meet this request is at the company’s discretion.




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total number of FFB received from suppliers every month. Cooperatives also no firm work-ing agreement with the compa-ny.

which is received by the mill and a monthly summary will be provided

2. There are no FFB suppliers that are under the company’s cooperatives

6. The road from Sei Meranti vil-lage to the company need re-pair. The company installed power pole at the side of roads from the mill going into Sungai Me-ranti because the company does not want to fell palm trees to place the poles there, and this leads to a very narrow path. The roads with many potholes within the company area should be repaired by the company or a request made to the local au-thorities to repair the roads.

1. The road going to Sei Me-ranti within the company’s land has all this time been the responsibility of the company to improve on a regular basis by using heavy equipment, i.e. a grader. The width of the road is 7 meters.

2. Initially the plan for installa-tion of electrical poles was proposed by the company to the National Electricity Company (‘Perusahaan Listrik Negara’/ PLN) and to facilities the installation of electrical poles, the com-pany felled 196 trees.

3. The potholed roads within the areas of the company for the time being are under maintenance by the com-pany

The company has a mainte-nance road program to the main road or collection road in 2015 and supported with a budget that contained in budget 2015. Sup-porting equipment includes one grader. Records of road mainte-nance in 2015 include: • Maintenance of the main road in

2015, planned throughout the 13,000 meters and the imple-mentation until October 2015 throughout the 10,832 meters

• Maintenance of the collection road in 2015, planned through-out the 64,163 meters and the implementation until October 2015 throughout the 53,728 me-ters.

7. Reporting to the Department of Agriculture of Bengkalis on plantation development every semester is not consistently done on time.

Progress report on the planta-tion for each semester is sent on an annual basis to the Of-fice of the estate.

The most recent report of UKL-UPL for first half of 2015 was sent to the Environment Agency (BLH) Bengkalis on 3 September 2015, and the Agriculture Agency Bengka-lis district on 3 September 2015, BLH Riau Province on 27 August 2015. However, the comment from the Department of Agriculture is noted as an observation.

8. Dust during the dry season due to the vehicles carrying FFB are really disturbing the villagers of Suka Maju Village

Currently the management implement road watering during the dry season 2 times (morning and afternoon).

This comment is also noted as an observation.

9. Good relationship with the company all this time. The company is transparent in all fields and has been working to enhance cooperation with all parties

The Company will always keep good relations with all parties concerned

Based on field observations and in-terviews with community leaders, there is indeed a good relationship between the company and local peo-ple, and society can feel the direct benefits of the presence of the Estate and the Mill activities in terms of eco-nomic and social development

10. There has never been any re-

port made to the police about any kind of conflict associated with the company, so the condi-tion is relatively peaceful. Tidak pernah ada laporan kepada pihak polisi tentang apa jenis konflik yang terkait dengan perusahaan, jadi kon-disinya agak aman.

The company always maintain a climate conducive to the parties concerned, to create a peaceful atmosphere in the neighborhood of the company

It was confirmed during this audit that there were no major issues found be-tween the company and its stake-holders, including local community members.




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11. It is hope that the company can sponsor small and medium en-terprises (SMEs) so they can get modal for their develop-ment.

The company is regularly contributing to the communities surrounding the company in accordance with the results of the Social Impact Assessment and capability of the company

The company already has a CSR program which is implemented in accordance with the results of SIA. Contributions for the development of SMEs is made at the discretion of the company.

12. Hope for improvement in terms of the company's CSR open-ness and uniformity (now somewhat chaotic) and that the company’s representatives are more polite, especially security. It is expected that the company seeks to improve CSR program, social assistance and co-operation between the company and communities.

1. The company is regularly contributing to the environment surrounding the company in accordance with the results of the Social Impact Assessment and capacity of the company

2. Employees of PT MSS including security will be reminded to be polite and have a courteous attitude in order to further improve in serving stakeholders come to PT MSS

The company already has a CSR program which is implemented in accordance with the results of SIA.

13. The company should endeav-our to reduce unemployment


The number of people of whom they hire is at the company’s dis-cretion based on need and ability of the applicant to fulfil the job re-quirements.

14. The company is requested to improve on their tranparency in future

The company already has a mechanism for provision of information and communication with relevant parties

The company has a procedure number PRO-BM-007 Rev 01 dated August 1st 2015 regarding Communication, Consultation and Coordination with stakeholder. The procedure describe how to respond to communication, consultation and coordination initiatives from stakeholders. It also lists the documents made publicly avail-able to stakeholders.

15. The impact of the company is quite positive. The company regularly makes positive contri-butions and provides assis-tance to the local people. We are already feeling the positive contribution of PT MSS com-pared to other mills in the dis-trict. Contributions include assis-tance in education, health, housing, water supply during

The company is regularly contributing to the communities surrounding the company in accordance with the results of the Social Impact Assessment and capability of the company

The company already has a CSR program which is implemented in accordance with the results of SIA.




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drought period, transportation for children to go to school, help with worship areas, and others.




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3.5 Acknowledgements of Internal Responsibility and Formal Sign-Off by Client It is acknowledged that the assessment visit was carried out as described in this report and we accept the as-sessment findings and report content.

Signed on behalf of PT TUV Rheinland Indonesia …………………………………………. Name: Carol Ng Siew Theng (Lead Auditor) Date: 5 April 2016




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APPENDICES

Appendix 1: Details of Certificate




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Appendix 2: Certification Audit Plan

Date / Time (1) Organizational Unit and Processes Auditor / Abbrev.

Interviewee Procedure – EM/QM Element - Standard Chapter

Monday, 2 November 2015 07.35-07.35 Travel from Kuala Lumpur–Medan Carol Ng

(CN) Airasia AK 396

05.35-08.00 Travel from Jakarta-Medan Suriadi Ali (SA), Naik Monang (NMA)

Garuda GA 180

08.45-09.45 Travel from Medan Airport – Medan Train station

CN, SA, NMA

Railink U7

10.37-16.14 Travel from Medan-Rantau Prapat CN, SA, NMA

Sribilah Utama U46 Train

16.30- Travel from Rantau Prapat – Estate PT MSS at Pekanbaru

CN, SA, NMA

By Car

16.30- Travel from Pekanbaru-Estate PT MSS

Dewi Akbari (DWA)

By Car

End of 1 st day audit Tuesday, 3 November 2015

08.00 – 12.00 Public Consultation All Auditor Stakeholders terkait

12.00 - 13.00 Lunch Break and prayer 13.00 – 15.00 Opening meeting

• Introduction to audit team,

• Introduction to company pro-file

All Auditor Estate and Mill Management

15.00 – 17.00 Estate

Document verification: RSPO • Financial viability • Compliance with legal

requirements • Standard perational procedures of

companies and its implementation • Improved soil fertility • Erosion control / soil degradation • Integrated pest management • Land Clearing • Continuous Improvement • Mitigation of GHG

CN Estate Management RSPO Principle 2 Criterion 2.1.1 Principle 3 Criterion 3.1 Principle 4 Criterion 4.1; 4.2; 4.5 Principle 5 Criterion 5.5; 5.6 Principle 7 Criterion 7.7 Principle 8 Criterion 8.1

15.00 – 17.00 Estate

Document verification: RSPO • Commitment to ethical conduct • Compliance with legal • Legal ownership documents • Soil conservation / erosion control • HCV • Use of fossil fuels • Soil survey and GIS • Management of fragile land • Continuous Improvement

NMA Estate Management

RSPO Principle 1 Criterion 1.3 Principle 2 Criterion 2.1; 2.2 Principle 4 Criterion 4.3 Principle 5 Criterion 5.2; 5.4 Principle 7 Criterion 7.2; 7.3; 7.4; 7.8 Principle 8 Criterion 8.1

15.00 – 17.00 Estate

Document verification: RSPO • Compliance with legal

requirements • Surface water quality monitoring • The use of pesticides • OSH • Training • AMDAL / UKL-UPL • Waste disposal • Continuous Improvement

SA Estate Management

RSPO Principle 2 Criterion 2.1.1 Principle 4 Criterion 4.4; 4.6; 4.7; 4.8 Principle 5 Criterion 5.1; .5.3 Principle 7 Criterion 7.1 Principle 8 Criterion 8.1

15.00 – 17.00 Estate

Document verification: RSPO

DWA Estate Management

RSPO Principle 1




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Date / Time (1) Organizational Unit and Processes Auditor / Abbrev. Interviewee

Procedure – EM/QM Element - Standard Chapter

• Compliance with legal requirements

• Requests for information • Publicly available documents • Land conflicts • Provision of information • Land use • SIA • Social impacts management • Workforce management • Continuous Improvement

Criterion 1.1; 1.2 Principle 2 Criterion 2.1.1; 2.2.3; 2.2.4; 2.2.5; 2.2.6; 2.3 Principle 6 Criterion 6.1 s/d 6.13 Principle 7 Criterion 7.5; 7.6 Principle 8 Criterion 8.1

17.00 End of 2 nd day audit Wednesday, 4 November 2015 08.00 – 12.00

Estate Field verification of: • Estate Legality • Boundary stones • Water conservation • Conservation area with high ero-

sion potential • HCV • Protected area • Continuous improvement

NMA Estate Management RSPO Principle 1 Criterion 1.3 Principle 2 Criterion 2.1; 2.2 Principle 4 Criterion 4.3 Principle 5 Criterion 5.2; 5.4 Principle 7 Criterion 7.2; 7.3; 7.4; 7.8 Principle 8 Criterion 8.1

08.00 – 12.00 Estate

Field verification of: • Land clearing activities • Nurseries • Planted area • Field maintenance, • Fertilizer application • Pest and disease control, • Harvesting and transporting of

FFB • Fire prevention • GHG emissions reduction

CN Estate Management RSPO Principle 2 Criterion 2.1.1 Principle 3 Criterion 3.1 Principle 4 Criterion 4.1; 4.2; 4.5 Principle 5 Criterion 5.5; 5.6 Principle 7 Criterion 7.7 Principle 8 Criterion 8.1

08.00 – 12.00 Estate

Field verification of: • Hazardous waste management • OSH • Land application • Water conservation • Implementation of the RKL-RPL

SA Estate Management RSPO Principle 2 Criterion 2.1.1 Principle 4 Criterion 4.4; 4.6; 4.7 Principle 5 Criterion 5.1; 5.3 Principle 8 Criterion 8.1

08.00 – 12.00 Estate

Field verification of: • Estate development community • Land disputes • Workers welfare • Prevention of child labour • Labour union • Social responsibility / CSR • Local business development • Provision of information • Complaints and feedback • Payroll system • The application of anti-

discrimination policy • Protection of reproductive rights

DWA Estate Management RSPO Principle 1 Criterion 1.1; 1.2 Principle 2 Criterion 2.1.1; 2.2.3; 2.2.4; 2.2.5; 2.2.6; 2.3 Principle 6 Criterion 6.1 s/d 6.13 Principle 7 Criterion 7.5; 7.6 Principle 8 Criterion 8.1

12.00-13.00 Lunch Break and prayer 13.00-17.00 Continue document check All auditors Estate

Management

End of 3 rd day audit




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Thursday, 5 November 2015 08.00 – 12.00

Mill Verification of documents and field visit related to: • Compliance with legislation • Legality of the mill • FFB reception • FFB processing • The use of fossil fuels • Use of water • Maintenance of machines • Licenses of machinery • Commitment to ethical conduct

NMA Mill Management RSPO Principle 1 Criterion 1.3 Principle 2 Criterion 2.1; 2.2 Principle 5 Criterion 5.2; 5.4 Principle 8 Criterion 8.1

08.00 – 12.00 Mill

Verification of documents and field visit related to:

• Compliance with legislation

• Mill Management

• Continuous Improvement Plans

• SOPs and implementation

• Fire prevention

• Mitigation of GHG emissions

• Supply Chain Certification System

CN Mill Management RSPO Principle 2 Criterion 2.1.1 Principle 3 Criterion 3.1 Principle 4 Criterion 4.1 Principle 5 Criterion 5.6 Principle 8 Criterion 8.1 SCCS All criterion

08.00 – 12.00 PKS



• Water quality monitoring

• OSH

• Training

• Hazardous Waste Management

• Environmental management / AMDAL / UKL-UPL / RKL-RPL

• Disposal and utilization of palm oil mill effluent

• Wastewater treatment plant

• Land application

SA Mill Management RSPO Principle 2 Criterion 2.1.1 Principle 4 Criterion 4.4; 4.7; 4.8 Principle 5 Criterion 5.1; .5.3 Principle 8 Criterion 8.1

08.00 – 12.00 Mill



• Provision of information

• Worker’s welfare

• Prevention of child labor

• Labour union

• Social responsibility / CSR

• Local business development

• Provision of information

• Complaints and feedback

• Payroll system

• The application of anti-discrimination policy

• Protection of reproductive rights

DWA Mill Management RSPO Principle 1 Criterion 1.1; 1.2 Principle 2 Criterion 2.1.1; 2.2.3; 2.2.4; 2.2.5; 2.2.6; 2.3 Principle 6 Criterion 6.1 s/d 6.13 Principle 8 Criterion 8.1

12.00-13.00 Lunch Break and prayer

13.00-17.00 Continue verification Mill Management

End of 4 th day audit

Friday, 6 November 2015




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08.00 – 10.00 Closing meeting All Audito

rs

Mill and Estate Management

10.30- Travel from Estate to Jakarta SA, DWA

Travel from Estate to KL CN




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Appendix 3: List of Abbreviations

AMDAL Analisis Dampak Lingkungan & Sosial (Social & Environmental Impacts Assessment)

BM Bina Mitra (Community Development) CPO Crude Palm Oil CSR Corporate Social Responsibility DPLH Dokumen Pengelolaan Lingkungan Hidup (Environmental Management Docu-

ment) EMU Environmental Management Unit EHS Environmental, Health & Safety EIA Environmental Impact Assessment ERTs Endangered, Rare & Threatened species ESH Environmental Safety & Health FFB Fresh Fruit Bunches EFB Empty Fruit Bunches HCV High Conservation Value HGU Hak Guna Usaha (Land Use Rights) Kepmenkes Keputusan Menteri Kesihatan (Ministry of Health Decision) IPM Integrated Pest Management IUP Izin Usaha PerEstatean (Estate Business Permit) LTA Lost Time Accident MSDS Material Safety Data Sheets MSS Murini Sam Sam NGO Non-Government Organization OSH Occupational Safety & Health P&C Principles & Criteria P2K3 Panitia Pembina Keselamatan dan Kesehatan Kerja (Committee of Occupational

Health and Safety) PermenLH Peraturan Menteri Lingkungan Hidup (Environmental Ministry Regulation) Permenakertrans Peraturan Menteri Tenaga Kerja dan Transmigrasi (Regulation on Minister of

Manpower and Transmigration) Permentan Peraturan Menteri Pertanian (Agriculture Ministry Regulation) Perpu Peraturan Pemerintah Pengganti Undang-Undang (Government Regulation in

Lieu of Law) PKO Palm Kernel Oil PLN Perusahaan Listrik Negara (National Electricity Company) POME Palm Oil Mill Effluent PP Peraturan Pemerintah (Government Regulation) PPE Personal Protective Equipment PROPER Program Performance Rating in Environmental Management (Program Penilaian

Peringkat Kinerja Perusahaan dalam Pengelolaan Lingkungan Hidup) RI Republik Indonesia (Republic of Indonesia) RKL Rencana Pengelolaan Lingkungan (Environmental Management Plan) RPL Rencana Pemantauan Lingkungan (Environmental Monitoring Plan) RTRWP Rencana Tata Ruang Wilayah Propinsi (Provincial Spatial Plan) SCCS Supply Chain Certification System SIA Social Impact Assessment SOP Standard Operating Procedure UKL Upaya Pengelolaan Lingkungan (Environmental Management Efforts) UPL Upaya Pemantauan Lingkungan (Environmental Monitoring Efforts) UU Undang-undang (Regulation)




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Appendix 4: List of Stakeholders Interviewed and Co ntacted

No. Name of Stakeholder

Institution / Position Remarks

Stakeholders Interviewed during Public Consultation Meeting 1. Siamet Rahayu PLH Village Secretary 2. Dahari Prayitno PLH Village Secretary 3. Ismet B. Peace and Order Section (Kasi Trantib) 4. Hanafi District Secretary 5. Hotman Gultom Indonesian Transport Workers' Union (SPTI)

and the All Indonesian Workers Union (SPSI)

6. Dian Suwindy Indonesian Transport Workers' Union (SPTI) and the All Indonesian Workers Union (SPSI)

7. S. Manik Public Order and Safety Officer (Bhabinkamtibmas)

8. M. Tamin A. Pangkalan Libut Village Head 9. Etnis Siran Head of Pancasila Youth 10. Zulfan FKPM Head of Balai Pungut Village 11. Wahidin Balai Pungut Village representative 12. Arif FKPM 13. Jalaluddin Supplier 14. Marjuki Pangkalan Libut Village representative 15. Bikrama Adam Supplier 16. Dedek Reformation 17. Lintung P. Name of organization

unclear 18. Aman Mandung Tenggarau Village representative 19. P. Hutabarat Supplier (UNEDO) 20. Burhan Sihotang Suka Maju Village representative 21. Dodo Pangkalan Libut Village representative 22. Zipro Situmtang Pangkalan Libut Village representative 23. Mustar J. Ambarita Tenggarau Village representative

Stakeholders Interviewed On-Site 24. Srimaryani Fertilizer Worker 25. Bertiana Siahaan Sprayer 26. R Sugeng Harvester 27. Jurianto Warehouse Foremen 28. Mujimin Harvester 29. Tri Nurhandayani Paramedic 30. Efrata F Ginting SHE Officer 31. Salmiah IPM Census Officer 32. Ahmad Sanjai

Munthe Assistant General Affair

33. Ardianto Supriman H

Tractor Operator

34. Novri Zein EHS Officer




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Appendix 5: Observations and Opportunities for Impr ovement

No. Observations / Opportunities for Improvement Criteria

1.

Geographical location stated in some documents, i.e. the company’s HCV report and report on implementation of UPL/UKL for Semester 1 of year 2015 stated the estate latitude as 1°20'20" - 1°50'25" N, however this was found to inconsistent with actual GPS reading taken from the estate office, which was 1°3' 33". The company should conduct recheck of the actual latitude of the estate location and ensure all documents reflect the actual GPS location.

-

2. Reporting to the Department of Agriculture of Bengkalis on plantation development eve-ry semester is not consistently done on time, as informed by a representative of the de-partment during the stakeholder consultation meeting

2.1.1

3. The company has not developed a mechanism for separation of HGU area and non-HGU area located within the same block to be implemented until all FFB produced from the non-HGU area can be included in the certification scope.

2.2.2

4. The company should prepare an information board describing the company’s pro-cedure for resolution of land conflicts and place it in front of the office.

2.2.6

5.

The format of the non-conformity findings table provided in internal audit findings report done by 2 internal auditors was dated 24-25 March 2015 was not the same format as required in the company’s procedure PRO-GEN-003 for internal audits. The format also did not list any root cause, correction or corrective action as per the SOP nonconformance form, but only stated the date of closure. As explained by the company’s internal audit department, the forms as per the SOP will be applied for internal audits once the company has been certified, as the current format used was primarily to assist the company to prepare for the upcoming certification audit. Im-plementation of the SOP will be verified further during the next surveillance audit.

4.1

6. Road maintenance during dry season may require additional watering to reduce dust asit was informed during the stakeholder consultation meeting that the dust is causing dis-turbance to the villagers of Suka Maju Village

4.3.3

7.

1) For water samples of Mandau River dated 9 April 2015, the BOD and COD of the upstream sample was 17.81 ppm and 59.36ppm respectively while for downstream sample was 21.12 ppm and 70.40ppm respectively. As the BOD and COD results showed a decrease in water quality in the downstream samples compared to up-stream, the company should make additional efforts to prevent further reduction in the water quality of the polluted river. It is not that since the upstream sample water quality exceeded the standard of 6 ppm for BOD and 50ppm for COD for Class III water sources as per the local regu-lation PP 82 year 2001, the sources of pollution most likely came from outside the estate 2) The company has not designated fixed water sampling points for Sg. Meranti River and Mandau River on-site and on a map

4.4

8. Follow-up medical consultations or awareness programs on PPE usage after audi-ometric results for 22 workers showed that they were found to have mild restricted hearing has not been done

4.7.2

9.

The company’s Environmental Management Document (Dokumen Pengelolaan Lingkungan Hidup - DPLH) has not yet been updated in accordance with change in operations since the mill’s production capacity has increased from 45 tonnes per hour to 90 tonnes per hour since year 2005.

5.1.2

10. The company is currently lacking posters and information boards to inform regarding the types of protected species in the area, especially in areas identified as HCV areas. (e.g. at the thicket swamp of Mandau River)

5.2.1

11. Demarcation of land application blocks has not been done in accordance with the land application permit of the company.

5.3.3

12. • The company’s SIA report does not include an analysis of when the estate man-agement plans to conduct replanting activities.

6.1.1




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• The company has not implemented a CSR program based on the result of social impacts which have been determined

13.

It was found that workers interviewed accept that there is no worker’s union and there are no issues with the workers. However, the company should discuss the possible formation of a worker’s union with all workers as there may be those who may request for it.

6.6.1

14.

• The company has a register of names of breastfeeding female but the form does not state a number, date of publication, date of revision in order to establish it as a formal document of the company.

• The current Gender Committee structure currently does not adequately include representation from all work levels, and there is no counseling service for those experiencing gender related issues

• The company has yet to carry out training on the reproductive rights of women

6.9.4

15. The palm oil mill has yet to reconsider whether manpower planning is sufficient for the engine room, as currently there are only just enough personnel to cover all shifts but lack of manpower if one operator is on holiday or absent.

4.7

16.

The stamps to be used by the estate for indicating sustainable crop and for the mill to indicate mass balance status of certified CPO and PK is still not available and only will be prepared after the company has received their RSPO certificate so that the certificate number is indicated on the stamps. This will be verified dur-ing the next surveillance audit.

SCCS E.3

PT MSS_Public Summary Report.rev4 - Wilmar International

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