RSPO Assessment Report - Sucofindo

SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES

Sucofindo ICS FRM 14.051 of 82

RSPOAssessment ReportPUBLIC SUMMARY

PT. Sumber Indah Perkasa – Sungai Buaya Mill ,Lampung, IndonesiaThis public summary has been prepared in accordance with RSPO requirements and theinformation included is the result of a full RSPO assessment of the Mills and supply base asincluded in the scope of the certificate.

Prepared by: Tuti Suryani Sirait (Lead Assessor)Certification decision made by:Triyan Aidilfitri

PT. SUCOFINDO (Sucofindo International Certification Services – SICS)Graha Sucofindo B1 Floor,Jl. Raya Pasar Minggu Kav. 34, Jakarta 12780 IndonesiaContact Person : Tuti Suryani SiraitPhone : (62-21) 7983666: Fax : (62-21) 7987015Email : [email protected]



List of Contents Page

A Scope of the Certification Assessment.................................................................4

A.1. National Interpretation Used ................................................................................4

A.2. Assessment Type (Estate and Mill) ......................................................................4

A.3. Location Map ......................................................................................................4

A.3.1. Location Address of the Mill and Approximate Tonnages Certified

(CPO and PK5 )...................................................................................................5

A.4. Description of Supply Base ..................................................................................5

A.4.1. General Description .............................................................................................5

A.4.2. Location of Supply Base ......................................................................................6

A.4.3. Statistic of Supply Base .......................................................................................6

A.5. Organizational Information and Contact Person...................................................7

A.5.1 Audit against the Rules for Partial Certification ....................................................8

A.6. Date Certificate Issued and Scope of Certificate ..................................................12

B. Assessment Process ...........................................................................................13

B.1. Certification Body.................................................................................................13

B.2. Qualifications of the Assessment Team ...............................................................13

B.2.1. Qualifications of the Lead Assessor and Assessment Team................................13

B.3. Assessment Methodology....................................................................................14

B.3.1. General Overview ................................................................................................14

B.4. Stakeholder Consultation .....................................................................................18

B.4.1. Summary of How Stakeholder Consultation was Organized ................................18

B.5. Date of Next Surveillance Visit .............................................................................21

C. Assessment Findings...........................................................................................22

C.1. Lead Assessor’s Summary and Recommendation for Certification ......................22

C.2. Summary of the Findings by Criteria ...................................................................23



D. Certified Organization’s Acknowledgement of Internal Responsibility...................53

D.1. Formal Sign-Off the Assessment Findings ..........................................................53

D.2. Statement by the Certifier Body on Behalf of PT. Sucofindo SBU-SICS...............54

List of Abbreviation ............................................................................................................55

Attachment 1 - Map ..........................................................................................................57

Attachment 2 - NCR ..........................................................................................................67

Appendix ...........................................................................................................................79



A.Scope of the Certification AssessmentA. 1. National Interpretation UsedThe management of the Palm Oil Mill(s) and associated suppliers of Fresh Fruit Bunches (FFB)were assessed for compliance against the International RSPO criteria as interpreted andendorsed for Indonesia, RSPO Certification Systems and RSPO Suply Chain CertificationSystems.

A. 2. Assessment Type (Estate and Mill)Certification Unit : PT. Sumber Indah Perkasa – Sungai Buaya Mill located at Mesuji Timur,Mesuji Regency – Lampung, INDONESIA

A.3. Location mapPlease see Appendix 1 : the details of estate maps of1. Overlay Map of Sungai Buaya Estate (SBYE), Gedung Aji Lama (GALA) Estate and Mesuji(MSJA) Estate, 2.Map of Rivers, 3.HCV , 4.Topography, 5. Planting Year

Sumatera Island - Indonesia



A. 3. 1. Location address of the mill and approximate tonnages certified (CPO and PK)

No Name of Mill Location Address GPS ReferenceAnnual Output (mt)

CPO PK

1. Sungai Buaya MillPT. SumberIndah Perkasa

Desa Talang Batu,Kecamatan MesujiTimur, KabupatenMesuji – Lampung

Latitude:4o07’ 43.00” LSLongitude:105o26’ 19.82” BT

66.926,18 16.420,64

Note : This data (Annual output) exclude from non-certified suppliers)

A.4. Description of Supply Base

A. 4. 1. General description

PT. Sumber Indah Perkasa operates 2 palm oil mills under PT Sumber Indah Perkasa, namedPT Sumber Indah Perkasa - Sungai Buaya Mill (SBYM) and PT Sumber Indah Perkasa –Sungai Merah mill (SMRM).The raw material/ FFB for PT. Sumber Indah Perkasa - Sungai Buaya Mill is supplied from the 1.



Sungai Buaya Estate (SBYE)-own estate, 2. KKPA Gedung Aji Lama (GALA) Estate -smallholder and 3. KKPA Mesuji (MSJA) Estate - smallholder. Totally supplied FFB from thesethree (3) estates are 300,561,69 MT.All estates are operated under one management of PT. Sumber Indah Perkasa. All estateslocated in Lampung, INDONESIA. PT. Sumber Indah Perkasa is a member of RSPO and theyare implementing a program to achieve RSPO Certified Palm Oil for all its production.There is no plan to expand the land holding and therefore Principles 7 is not applicable to thisassessment.

A. 4. 2. Location of the supply base

No. Estate Name LocationGPS

Latitude Longitude

1 Sungai Buaya Estate(SBYE)

Desa Talang Batu,Kecamatan Mesuji Timur,Kabupaten Mesuji –Lampung

4o09’ 44.86” 105o26’ 09.23”

2 KKPA Gedung Aji Lama(GALA) Estate– Plasma

Desa Paduan Rajawali,Kecamatan Meraksa Aji,Kabupaten TulangBawang – Lampung

4o 17’ 23.84” 105o 25’ 54.68”

3 KKPA Mesuji (MSJA)Estate– Plasma

Desa Brabasan,Kecamatan Tanjung Raya,Kabupaten Mesuji –Lampung

3o 58’ 40.74” 105o 20’ 50.75”

A. 4. 3. Statistic of supply base

No. EstateName

PlantingYear

Area/PlantingYear

Age/PlantingYear

EstimatedFFB/Year

EstimatedCPO/Year

1 SungaiBuayaEstate(SBYE)

1991 513,14 22 11.625,545 2.565,87

1992 2.720,94 21 67.169,083 14.824,88

1993 1.118,24 20 22.702,698 5.010,71

1994 402,54 19 7.448,399 1.643,94

2000 30,66 13 705,555 155,72

2 KKPAGedungAji Lama(GALA)

1995 250,00 18 6.930,170 1.510,23

1996 2.833,00 17 78.414,670 17.088,21

1997 1.313,00 16 34.927,270 7.611,39



Estate -Plasma 1998 606,00 15 15.561,800 3.391,25

3 KKPAMesuji(MSJA)Estate -Plasma

1995 149,75 18 3.337,980 736,90

1996 2.631,25 17 62.722,060 13.846,72

1997 1.891,88 16 47.275,360 10.436,66

1998 533,00 15 12.488,510 2.757,00

A. 5. Organizational Information and Contact Person

1 Company Name PT. SUMBER INDAH PERKASA – Sungai Buaya Mill(SBYM)

2 Personal Contact Ismu Zulfikar

3 Vice Management Humala Sinaga

4 Company Address Sinarmas Land Plaza Menara 2 Lantai 30, Jalan M. H.Thamrin No. 51, Jakarta, Indonesia

5 Company Status PMDN

7 Phone/ Fax 021 50338899

8 E-mail [email protected]

9 Website www.smart-tbk.com

10 RSPO membership number 1-0096-11-000-00



A. 5. 1. Audit Again the Rules for Partial Certification

1. IntroductionThe audit team has visited Head office at Sinarmas Land Plaza, Tower 2, 30th Floor, Jalan M.H. Thamrin No. 51, Jakarta, Indonesia dated 13 September 2013, to find out the compliancewith the rules for partial certification standard in the whole group of Golden Agri Resources,Ltd. (GAR Group). There are 17 mills and 61 estates (including plasma) within this group.This is the first company in group to be certified by PT Sucofindo, SBU SICS for RSPOcertification. The team found that the company conforms with the RSPO requirements forpartial certification as stated in the final RSPO certification Systems documents, June 2007,section 4.2.4. Progress and any issue will be verified and reported in subsequent surveillancevisits.

2. Assessment agenda (partial Certification Audit)

3. Audit Team Findings in Correlation to the Rules Partial Certificationsa. The Organization is a member of RSPO

PT Sumber Indah Perkasa has confirmed membership of the RSPO with no. 1-0096-11-000-00

b. A Time Bound Plan for achieving certification within relevant entities

No Name ofMill Supply Base Company Location

Estimatetime of

Certification

1 SungaiBuaya Mill

Sungai BuayaEstate

PT. SumberIndah Perkasa

Lampung 2013

Gedung Aji LamaKKPA

Mesuji KKPA

2 SungaiMerah Mill

Sungai MerahEstate

PT. SumberIndah Perkasa

Lampung 2013

Gedung Aji BaruKKPA

Gedung Aji LamaKKPA

3 PangkalanPanji Mill

Sawit Mas Estate PT. Sawit MasSejahtera South

Sumatra2014

Date Location Agenda

13 September2013

Head Office - Jakarta Meeting with sustainable team to verifylegal documents, HCV, Labor Union andland conflict within the GAR group



4 Bumi SawitMill

Bumi Sawit Estate PT. Bumi SawitPermai South

Sumatra2014

5 MuaraKandis Mill

Muara Kandis PT. DjuandaSawit Lestari South

Sumatra2014

Muara Tawas

Pandawa KKPA

Pandawa Plasma

6 SungaiRungau Mill

Sungai RungauEstate

PT. SumberIndah Perkasa Central

Kalimantan2013

Sungai SeruyanEstate

Terawan Estate

Tangar Estate

Bukit Tiga Estate

7 Bukit PerkMill

Bukit Perak PT. Bumi PermaiLestari Bangka

Belitung2014

Bukit Permata

8 TanjungKembiri Mill

Tanjung KembiriEstate

PT. ForestaLestari Dwikarya Bangka

Belitung2013

Tanjung Rusa

9 SungaiKupang Mill

Sungai KupangEstate

PT. SinarKencana Inti

Perkasa

SouthKalimantan

2015

Sungai Kupang

10 Kasuari Mill Cendrawasih PT. SinarKencana Inti

Perkasa

Papua 2014

Nuri Estate

Rajawali Estate

Mambruk Estate

11 SenakinMill

Senakin Estate PT. PurimasSasmita South

Kalimantan2014

12 PekawaiMill

Kayung Estate PT. AgrolestariMandiri West

Kalimantan2014

Pekawai Estate

Sungai Kelik

Nanga Tayap



Kayung Kemitraan

13 KenangaMill

Kencana Estate PT. KencanaGraha Permai West

Kalimantan2014

Cendana Estate

Kenanga Estate

Cempaka Estate

Kencana

Kenanga

14 TanggarMill

Manuhing Estate PT. TapianNadenggan Central

Kalimantan2015

Kajuji Estate

Sulin Estate

Nahiyang Estate

Katayang Estate

Sungai Nusa

Sako Estate

Sungai AyawanEstate

15 PerdanaMill

Perdana Estate PT. BinasawitAbadi Pratama Central

Kalimantan2015

Lenggana Estate

Semandau Estate

Muara Dua Estate

16 Kuayan Mill Mentaya Estate PT. AgrokaryaPrima Lestari Central

Kalimantan2015

Kuayan Estate

Bukit SantuhaiEstate

Tajur Beras

Seranau Estate

Sapiri Estate

17 Belian Mill Gaharu Estate PT. ParamitraInternusa West

Kalimantan2015

Muara Tawang



Estate Pratama

Belian Estate

Tengkawang

Kapuas Hulu

Team has been verified documents during partial certification audit. The companyhas conductedGap analysis to the whole group compare to P & C RSPO requirement. The Gap Analysisconducted by BSI Certification Body. Randomly, the team checked the content of reports toensure the fulfillment of partial certification. From the sampling report, the team found that not allreport has the conclusion for the fulfillment regards to partial certification requirement.The company has made the self declaration for partial certification rule and signed bymanagement. The self declaration stated as belows (a-d) :

a. Significant ConflictsThe company has the SOP for Conflict Land Resolution refers to RSPO criteria 6.4, 7.5and 7.6. All the conflicts so far has been resolved with mutual agreement. GAR alsoregistered as member of RSPO Dispute Settlement Facility Advisory Group as arepresentative of grower. Supporting document is DSF RSPO member as a growerdated 22 April 2013.

b. No replacement of primary forest and or area with HCV’s since November 2005 or year2007 (National Interpretation)PT. SMART Tbk, has been appointed to manage all companies under GAR Group. PTSMART Tbk has conducted Historical HCV Assessment (HHA) in collaboration withFaculty of Forestry, Institut Pertanian Bogor (IPB) April 2011. Historical HCVAssessment (HHA) Report has been submitted to RSPO on May 2011. As a follow upfrom the Historical HCV Assessment (HHA) Report, GAR has been proposed HCVRemediation Plan to RSPO. Revision of HCV Remediation Plan is on going process/discussion with RSPO Biodiversity and HCV Working Group (BHCV WG). Supportingdocuments is Historical HCV Assessment (HHA) report.

c. No labor disputes that are not being resolved through an agreedThe company has the SOP and mechanism to resolve dispute with union labor withmutually agreement. The latest resolution dispute document handled as evidence isdispute between workers (Hanadi) with PT. Foresta Lestari Dwikarya for terminatedemployment. The worker has been assumed to be resigned as he has absent for 8(eight) days in a month. The supporting document is available such as chronology ofresolution Industrial Relation between worker and PT. Foresta Lestari Dwikarya, copy oflegal verdict caseIndustrial Relations No. 08/G/2012/PHI. PN PKP from court of IndustrialRelations at Court of District Pangkalpinang. Collective agreement PT. FLD with Mr.Hanadi No. 07/EM-pb/IV/2013 completed with the sign of each party.

d. No evidence of non-compliance with law in any of the non-certified holdingsThe company has comply with the applicable law and regulation refers to RSPO criteria2.1.which stated no evidence of non-compliance with the applicable regulation.Supporting documents are copies of SK AMDAL, SK HGU, IUP, IMB.



A.6. Date Certificate Issued and Scope of Certificate

Name of Client PT SUMBER INDAH PERKASA – Sungai BuayaMill

Client Number RSPO 00003

Certificate Number RSPO 00003

Certification Decision Date

Issued by PT SUCOFINDO, SBU SICS

Address GrahaSucofindo, SBU SICS. Jl RayaPasarMingguKav 34 Jakarta 13640

Telephone /Fax Tel.: +62-21-7983666 / Fax.: +62-21-7987015

Email [email protected]

Website www.sucofindo.co.id

Scope :

Mill PT. Sumber Indah Perkasa - Sungai Buaya Mill(SBYM)

Estate 1. Sungai Buaya Estate (SBYE)2. Mesuji Estate (MSJA)3. Gedung Aji Lama Estate (GALA)

Projected mass balance CPO & PK CPO : 66.926,18 MT and PK : 16.420,64 MT

Certification Registration Code SICS-00003

Type of Certification Single site

Certifier Triyan Aidilfitri

Signed



B. Assessment ProcessB. 1. Certification BodySUCOFINDO SUCOFINDO ICS INTERNATIONAL CERTIFICATION SERVICES (SUCOFINDOICS), which was formed in 1994, is one of the strategic business unit that provides certificationservices for leading companies.SucofindoCertification by International Certification Services isrecognized nationally and international.Quality Management System Certification bySUCOFINDO ICS has obtained accreditation from National Accreditation Committee (KAN-Indonesia).Lead Auditors and Auditors of SUCOFINDO ICS are trained professionals in the field ofinternational standards, auditing and management systems and are registered in the IRCA(International Register of Certified Auditors) and IEMA (Institute of Environmental Management& Assessment), UK. SUCOFINDO ICS certification process is supported by experts at PT.SUCOFINDO who understand the industry sectors and services in Indonesia.SUCOFINDO ICS Operational is supported by a network of branch and representative offices ofPT. SUCOFINDO spread in 45 cities across Indonesia.The services provided by International Certification Services Sucofindo are: Quality Management System Certification Environmental Management System ISO 22000 :2005 OHSAS 18000 Certification Hazard Analytical Critical and Control Point (HACCP) Certification Good Manufacturing Practice (GMP) Audit Product Certification Sustainable Forest Management Certification Products Organic Food Certification RSPO certification ISPO Certification Certification of Integrated Management System Certification (SMT) Training

B. 2. Qualifications of the Assessment Team

B. 2. 1. Qualifications of the Lead Assessor and Assessment TeamTuti Suryani Sirait (Lead Auditor) :Graduated from Institute Agriculture in Bogor (IPB), 1991She has more than 10 years audit experiences in auditing HACCP, GMP, ISO 9001:2008, ISO22000:2005, ISPO and RSPO.She has successfully completion training RSPO by Komisi RSPO, Jakarta, SCC StandardTraining by David Ogg & Partner – Jakarta, ISPO Lead Auditor Training by Komisi ISPO,Jakarta, Lead Auditor Training of ISO 9000/19011 organized by SICS – Sucofindo, ISO 22000: 2005 FSMS Auditor / Lead Auditor by Moody International, Singapore; Lead Assessor for FoodSafety Management System (HACCP&GMP) by QAS Sydney, Australia and Social Lead AuditorTraining (SA 8000) from Social International Audit (SIA), Turkey.She is actively participated in RSPO meeting to discuss RSPO P & C and also as a trainer inISPO Lead auditor training.



WarsidSumarlin (Auditor)He graduated from Institute Agriculture of Bogor (IPB) majoring Economic and Social.He has more than 5 years audit experiences in OSHAS and SMK3. He has successfullycompletion from Lead auditor for SMK3, Lead Auditor for OHSAS and Lead Auditor for ISO9001. He has successfully completion training RSPO by Komisi RSPO, Jakarta, ISPO LeadAuditor Training by Komisi ISPO, Jakarta.Rizky Qomaruzaman (Auditor)Lead Auditor SMK3 since year 1997 till now. Lead Auditor OHSAS 18001 since year 2000.Auditor ISO 14001 since 2002. Premises visited: many various industries, petrochemical, oil &gas, EPC, general contractor, Palm Oil Plantation and Mill, chemical, pulp & paper, coal mining,cement industries, and so on.Attended Green Company Training year 2008, He has successfully completion from ISPO leadauditor course year 2013, attended RSPO lead auditor Course at KL year 2013, attendedenvironmental seminar (Environmental Audit) from Environmental Ministry Republic OfIndonesia year 2013.Yusuf Mu’arif (Auditor)He has graduated from Bogor Agriculture University (IPB Bogor) since March 1988.He has more than 10 years audit experiences in auditing (internal and external audit) ofAustralian Quarantine Scheme and Ministry of Agriculture of RI, ISPO, OHSAS and SMK3.He has successfully completion training of ISPO Lead Auditor Training by Komisi ISPO, InternalAuditor SMK3 from Ministry of Manpower and Transmigration RI that held by SICS – Sucofindo.Kind of audit scope such as various industries, petrochemical, general contractor, plantation ofpalm oil, chemical, electrical generator project, telecommunication etc.Ganjar Gumelar (Auditor):He graduated from University ofGadjahMada (UGM), Forestry Faculty, majoring in ForestManagement, Yogyakarta.He has completed the training such as Indonesian Sustainable Palm Oil (ISPO) auditor training,Komisi ISPO – Ministry of Agriculture & Komisi Akreditasi Nasional (KAN), Bogor (West Java) &Pangkalan Bun (Kalimantan), Indonesia, 2013 ;ISO 9001 : 2000 Quality Management Systems(QMS) Auditor/Lead Auditor Training Course (IRCA),PT. SUCOFINDO (Persero), Jakarta,Indonesia, 2013 ; Awareness Hazard Analysis Critical Control Point (HACCP), PT. SUCOFINDO(Persero), Jakarta, Indonesia, 2013 ; Life Cycle AssessmentWorkshop Oil Palm Plantation andOil Palm Milling, Life Cycle Sustainability Assessment Lab &State Minister for The Environment,Jakarta, Indonesia, 2013 ; Assessor Training High Conservation Value Forest – HCVF,Tropenbos International Indonesia Program, The Nature Conservancy (TNC), WWF Indonesia &Institut Pertanian STIPER (INSTIPER) Yogyakarta, Yogyakarta, Indonesia (2011).

B.3. Assessment Methodology

B. 3. 1. General OverviewThe assessment was carryingout in conformity with the SBU SICS RSPO manual andprocedures for auditor and certifier. The assessment was conducted by qualified auditors andreferred to RSPO standard as endorsed for the Indonesia National interpretation. Partialcertification audit conducted in September to check compliance with Final RSPO CertificationSystem for partial certification.The opening and closing meeting was conducted at the office Tulang Bawang - Lampung andthen continue in Mill’s and estate’s offices. Stakeholders meeting was conducted twice, firstly



was held during Preliminary Audit and secondly Certification Audit.At the opening meeting, the team audit confirm to conduct the audit at :Regional Office at Tulang Bawang - Lampung, include

Documentation review for transparencies CSR plan and policy Internal Audit program & Management Review Meeting Land ownership and compensation mechanism

At estate, include : Worker interviews :OSH. Sexual, religious, racial harassment. Payment scheme,

contracts. Child labor. First aid. Awareness. Chemical stores : Storage. MSDS leaflets. Herbicide mixing areas. PPE. Ventilation.

Security. Field inspections: Fertilizing operations. SOP’s., Herbicide application program.

Harvesting sites and efficiency. Soil maps. Land preparation. Ground cover. IPM. Firstaiders and boxes. Soil erosion.

HCV’s:Identification. Management plans. Environmental Impact Assessments Riparian zones:Width. Current and future management, monitoring system Water management:Water courses. Water monitoring. Road maintenance:Program and progress of road improvement. Social amenities:Social Impact Assessments. Workshops:Oil traps. Safe working environment. PPE.Diesel tanks. Environmental waste

management. Line sites:Interviews with householders. Inspection of water discharge points. Water

improvement plans. Waste disposal. Local communities. Contributions made. Employment opportunities. Social impacts.

Complaints procedures, Transparency.At Mill include :

Mill and workshop inspections. Documentation. Worker interviews. SOP’s. Safe working environment. Gen sets. Walk ways. Signs. EFB.

POME treatment. Emissions. Mass balance. Diesel tanks. PPE. Fire extinguishers. Firstaiders and boxes. Fuel and water usage.

OSH. Training. Management structure. First aiders. Full document review. Completion of the checklist. Review and documentation of

evidence. All aspects of RSPO P&C’s applicable. Worker interviews. OSH. Sexual, religious, racial harassment. Payment scheme,

contracts, union labor Supply Chain Certification System from receiving until finish products (CPO and PK).

Actual Audit Programme

Phase I : Preliminary AuditDate/Time Functions / areas / Department / activities to be audited (include

related requirements)10 June 2013 Day 1st Audit12.35 Departure from Jakarta – Lampung



13.00 Departure to Regional Office Sungai Buaya Estate13.00 Break15.00 Opening Meeting at Regional Office (All Team)17.00 End of the day 111 June 2013 Day 2nd Audit08.00 Location: Sungai Buaya Estate (Division II blok 14-15)

Environment Aspects : Water Management (water courses, watermonitoring); Environment waste management, Environmental Impacts,Chemical store (RQ)HCV Aspect :HGU and Land Status Estates confirmation, Riparian Zone ,HCV Confirmation (RQ)Plantation Aspects : Herbicide Application Programme, Integrated Pestmanagement ); Harvesting Site, Fertilizing Operations, Land Preparationand Assessment (WS)

12.00 BreakSungai Buaya Mill & Sungai Merah Mill (All Team )

14.00 Document Review of Environmental, HCV, Social and Best PracticesAspects

17.00 End of the day 212 June 2013 Day 3rd Audit08.00 Sungai Buaya Mill & Sungai Merah Mill (All Team)

Environment Aspect, Biodiversity, & HCV (RQ)OSHAS/SMK3, Worker Welfare, Training, & Best Practices (WS)Social, Legality, Management & SCC System (TSS)

17.00 End of the day 313 June 2013 Day 4th

Gedung Aji Baru Estate (blok B 13)08.00 Document Review of Environmental, HCV, Social and Best Practices

Aspects (TSS, WS, RQ)12.00 Break14.00 Environment Aspects : Water Management (water courses, water

monitoring); Environment waste management, Environmental Impacts,Chemical store (RQ)HCV Aspect :HGU and Land Status Estates confirmation, Riparian Zone ,HCV Confirmation (RQ)Plantation Aspects : Herbicide Application Programme, Integrated Pestmanagement ); Harvesting Site, Fertilizing Operations, Land Preparationand Assessment (WS)

17.00 End of the day 414 June 2013 Day 5th Audit08.00 Reporting12.00 Break15.00 Closing Meeting19.00 Departure from Lampung to Jakarta

Scope : 2 mills and 5 estatesNumber of assessor participating: 3 auditorsNumber of days spent for the assessment on site : 15 daysTotal number of person days used for the assessment on site :15 days



Phase II : Certification Audit

Date/Time Functions / areas / Department / activities to be audited (include relatedrequirements)

15 Jul’13 1st Day12.35 Departure from Jakarta – Lampung13.00 Departure to Regional Office Sungai Buaya Estate13.00 Break14.30 Opening Meeting

Arrangements Schedule Auditor vs auditeesArrangements location (estate and stakeholders) to be visited

16.30 End of audit day 116 Jul’13 2nd Day

07.30 Location : OfficeDocuments Audit : Review previous findings (All Team)

12.00 Break14.00 Location : Sungai Buaya Mill (SBYM)

Best Practices & Environment Aspect (RQ)Worker Welfare, Training, Management (WS & TTS)OSHAS/SMK3 (YM)Social & Legality (TSS & GGU)

16.30 End of audit17 Jul’13 3 rd Day

09.00 Location : Mesuji KKPA (MSJA)Environment Aspects:Water management (Water courses, water monitoring);Environment waste management, Environmental Impacts; Chemicals store.(RQ)HCV Aspect: HGU and Land Status Estates confirmation, Riparian Zone, HCVConfirmation. (GGU & YM)Plantation Aspects: Herbicide Application Programme, Integrated Pestmanagement); Harvesting Site, Fertilizing Operations, Land Preparation andAssessment. (GGU & YM)Social Aspects: Meeting Stakeholders, Kepala Desa and Confirmation ofLocal Contribution /CSR. (TSS)Worker Welfare:Housing, Clinic, Labor Union, Koperasi, Worker welfare. (WS)Location : Gedung Aji Lama KKPA (GALA)Social Aspects : Meeting Stakeholders, Kepala Desa and Confirmation ofLocal Contribution /CSR. (TSS)

16.30 End of audit18 Jul’13 4th Day

07.30 Location : Sungai Merah Estate (SMRE)Environment Aspects:Water management (Water courses, water monitoring);Environment waste management, Environmental Impacts; Chemicals store.



(RQ)HCV Aspect: HGU and Land Status Estates confirmation, Riparian Zone, HCVConfirmation. (GGU)Plantation Aspects: Herbicide Application Programme, Integrated Pestmanagement); Harvesting Site, Fertilizing Operations, Land Preparation andAssessment. (YM)Social Aspects: Meeting Stakeholders, Kepala Desa and Confirmation ofLocal Contribution /CSR. (TSS)Worker Welfare:Housing, Clinic, Labor Union, Worker Welfare. (WS)

12.00 Break14.00 Location : Sungai Merah Mill (SMRM)

Best Practices & Environment Aspect. (RQ, YM & GGU)Worker Welfare, Training, Management (WS)OSHAS/SMK3 (WS & YM)Social Legality, & SCC System (TSS)

16.30 End of audit19 Jul’13 5th Day

07.30 Reporting (All Team)12.00 Break14.00 Closing Meeting (All Team)17.00 Back to Lampung22.00 Arrive at Lampung

20 Jul’13 6th Day06.50 Back to Jakarta

Scope : 2 mills and 5 estatesNumber of assessor participating: 5 auditors + 1 Witness Ministry of Agriculture, totally 6 personNumber of days spent for the assessment on site:30 daysTotal number of person days used for the assessment on site : 25 days

B. 4. Stakeholder Consultation

B. 4. 1. Summary of How Stakeholder Consultation was Organized

Stakeholders Consultation and Company ResponsesIssue Company Responses Assessor Findings

Sungai Buaya Mill (SBYM)

FFB Contractor : Mr. Dalmadi

The employee of contractor hasbeen paid as per governmentstandard for minimum salary perprovince.

The contract agreement hascontained the requirement for

Company has the SOP,stated contractor should obeyfor safety standard andrelevant governmentregulation.

- Conform



safety.

The payment methods has beenagreed by each party

The contractor has been trainedfor safety matter

Sungai Buaya Estate (SBYE)

Head of Sub-district Meraksa Aji(Bpk Sukerdi)

There is complains from growersthat company charge forproduction, transport andmethods was not clearly defined

The head of Sub-districtMeraksa Aji is new in hisposition. Therefore, theinformation received could benot from representativegrowers.

The head of Sub-districtMeraksa Aji has beenassigned for 6 month in theSub-District. The informationgiven is sopposed to bevalid. The Company shouldensure cooperative’s effortsto socialize aspects thatbecome a factor in pricecutting related to costsimposed to plasmamembers for maintenanceand transportation costs.Proof that all partiesunderstand the contractagreement they entered to,and that the contracts arefair, legal and transparent. –Observation

KKPA GALA Estate

Religion Leader : Mr. KHMuhidin

Head of Village : Mr. Suraji

- Confirmed no land conflict- The request information

always replied by company- There is company charity for

Islamic school

Company has the SOP forInformation Request andResponse. All informationrequests should beresponded for maximum 1month.

Conform

KKPA MSJA Estate

Head of village Mesuji : Mr.Azhar Hidayatullah

- Access to village is shorter aspeople have the shortcut via

The company will conductsocialization for gradingsystem at mill and also tointroduce the types of rareand endangered flora andfauna surrounding village.

Observation.



estate.- Company provides

scholarship to the localcommunity.

- No socialization yet to localcommunity to maintain rareand endangered flora & fauna

- Local empowerment byemploy local people andcontractor for FFB transporter

- The company has conductedCSR program such as missalmedication, glass aid, andbazaar.

- The grading system at mill isnot clearly to the growers

- There are an indigenouspeople (Nenggala ethnic) butthe location is about +/- 60 kmfrom nearest estate.

Labor Union

Union Leader : Mr. Sopuan

- Confirm that no child laboremployed

- Salary minimum for workershave been complied

- Regular Meeting has beenconducted with supportingfacility by management

Company has the policy toallow the worker to form theunion labor. The evidence iscirculating letter from CEO-2No. 094/CEO2/SE/12/2010dated 14/12.2011. Only one(1) labor union registered inthe company.

Conform

Cooperation Krida Sejahtera

Head of Cooperation : Mr. MiseriAJ Aminanto

- The plasma member is totally17.062 member from 36villages

- There is not yet socializationconducted regarding sexualharassment to the growers.

- The grading methods havebeen clearly defined andthere are two (2) staffspresent at the mill every dayas a witness during gradingprocess.

- There is no conflict land

The company will set up theprogram to ensure allrepresentative growers andstaff will be adequatesocialize for sexualharassment issue.

Minor no. 01



among growers andcompany.

- Payment from companyconducted twice per monthand the payment time isalways on time

B. 5. Date of Next Surveillance VisitOne (1) year after date of certification



C. Assessment FindingsC. 1. Lead Assessor’s Summary and Recommendation for CertificationThe audit is conducted jointly Roundtable on Sustainable Palm Oil (RSPO) Certification Schemeand Indonesian Sustainable Palm Oil (ISPO) Certification Scheme. There are 2 (two) mills and 5(five) estates has been audited at the same time during preliminary (June, 10th-14th 2013) andcertification audit (July, 15th-19th 2013). Some of the issues between ISPO and RSPO are mainlysame such as commitment to transparency, compliance with applicable laws and regulations,commitment to long-term economic and financial viability, environmental requirements, socialaspects, best practices of estates and mill and continuous improvement. The significantdifferences which is only for RSPO requirements such as term of findings, HCV’s issue, SIA,sexual harassment requirement, specific requirements of contractor (should be meet withmanpower regulation and well trained), and NPP requirement.The audit conducted twice i.e. preliminary audit and certification audit. The scope of the audit forthis unit is a mill (SBYM) and three (3) estates. Two (2) of the three (3) estates are smallholderschemes (KKPA Gedung Aji Lama (GALA) Estate and KKPA Mesuji (MSJA) Estate) and theown estate is Sungai Buaya Estate (SBYE). The Mill and estates has been visited duringpreliminary and certification audit (no sampling).The management (Mill and estate) showed the commitment to the implementation of theprinciples and criteria of the RSPO NI-INA. The assessment has been carried out through fieldvisit to head office, mill and estate.The public announcement for certification has published on RSPO website prior 30 days fromthe audit certification to give the opportunity to stakeholders for comments and feedback. Thereis no a grievance or complaints received from the stakeholders during 30 days of publicconsultation period. Team auditors also conducted separate meeting with village head, localcommunity, union labor team, and government official representatives. There is someclarification received regarding the HCV issue, conflict land, Socialization of Rare andendangered flora and fauna, transparancies, charity, etc.There is 1 NCR minor and 10 Observations issued during certification audit. There iscommitment of management to make corrective action and for continuous improvement. Thereis also improved plan for social and environmental area.The audit team found that PT Sumber Indah Perkasa (Sungai Buaya Mill (SBYM), Sungai BuayaEstate (SBYE),KKPA Gedung Aji Lama (GALA) Estate, KKPA Mesuji (MSJA) Estate arecomplying against RSPO P & C approved for Indonesia. Therefore the recommendation of theLead Auditor that Certificate of RSPO is awarded to PT Sumber Indah Perkasa – Sungai BuayaMill and its estates.

Signed :

Tuti Suryani SiraitDate : September 16, 2013



C. 2. Summary of the Findings by Criteria

1 COMMITMENT TO TRANSPARENCY

1.1 Palm oil growers and millers provide adequate information to otherstakeholders on environmental, social and legal issues relevant to RSPOCriteria, in appropriate languages & forms to allow for effective participation indecision making.

Company has established SOP of Response to Request and Information(SOP/SPO/SMART/LH-01). List of information is in place that is accessible to relevantstakeholders, which is different between mill, main estate and plasma estate. Estate Manager isresponsible for providing stakeholders with relevant information particularly information relatingto social aspect.In the Mesuji Plasma Estate, the person in charge of social aspect was appointed by themanagement through the letter of appointment no 016/RC-LAMPUNG/01/2012 that the MSJAManager is responsible for social aspects and communication with stakeholders. Allcommunication is recorded in the communication book for all stakeholders (internal andexternal). The majority of requests found in the list of stakeholder request are clean watersupply request from the Community of Brabasan Village. Sampling is conducted on the Letter ofrequest from Brabasan Village Manpower and Transmigration Service asking for labor and grasscutting equipment assistance, dated 12 Feb 2013 under the name of Drs. Rozali. Company hasresponded by providing assistance on 23 Feb 2013 evidenced by the minutes of hand-over of 1unit of grass cutting equipment along with the operator. All forms of request for information arefiled in a folder and indexed according to the date of incoming letter.For GALA Plasma Estate, personnel responsible for communication with stakeholders are theGALA Manager who is established with management decision letter no. 12/SK-RC-Lampung/IV/2013. Any requests for information are recorded in log book. Recorded informationrequests comprise routine reports to government agencies in need. Communication andConsultation are recorded in a separate log book. In general, most request letter is asking forassistance of road repairs and surfacing from surrounding communities. Sampling wasconducted on the letter of request from the Paduan Rajawali Village Chief dated 8 November2012 containing a request for heavy equipment assistance. Company had followed it up on 26November 2012 by conducting road repairs using Grader in Paduan Rajawali Village, MeraksaAji District -Tulang Bawang and evidence of completion had been documented in the form ofMinutes.The records of information requests and responses are kept with retention time of 10 years.Compliance status: Full Compliance

1.2 Management documents are publicly available except where this is preventedby commercial confidentiality or where disclosure of information would result innegative environmental or social outcomes

Confidential documents are documents outside the list of information to Stakeholder, such ascommercial data and data causing negative impacts that are accessible only uponmanagement’s approval, e.g. conflict data. In general, data may be accessed /asked by relevantstakeholders as long as relevant. In addition there are data that can be given only to relevantagencies, for example production data is given to the Regency and Provincial Plantation Service.



Compliance status: Full Compliance

2 COMPLIANCE WITH APPLICABLE LAWS AND REGULATIONS

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

Company has made periodic evaluation of all regulations which is regulated throughSOP/SPO/SMART/LH/03 (Legal and Other Requirements rev 01), which is evaluated persemester. Central office’s Sustainability division performs evaluation and the results arecommunicated to the units (estates and mills), which in turn will select those regulations relevantto them. Sampling of Mesuji Estate, personnel responsible for ensuring compliance withregulations related to ‘sustainable palm oil’ is under the responsibility of Sustainable Palm OilOfficer stipulated in decision letter no. 03/EM-MSJA/VI/2013. Company sorts regulation listaccording to the aspect s: environmental aspect, estate aspect, permit aspect, employment andoccupational safety and health (OSH) aspect. Evidence of evaluation of the most recentregulations such as PP no 27/2012 relating to environmental permit has conformed. Othersampling of evidence of compliance with regulations has conformed such as company hasconducted reporting routinely to relevant agencies, for example routine report to Jamsostek(worker’s social security).Company previously has operating permit of one (1) mill for the capacity of 30 ton/hour. At thetime of preliminary audit, a nonconformity was found in which the company had two (2) Milswitha capacity of 60 ton/hour each, totalled 120 ton/hour. At the time of certification audit, thecompany had been following it up by processing the IUP for Mills of 120 ton FFB/hour capacity.The company already has a letter from the Board of Investment and Regional Integrated PermitService with No. 800/200/BID.V/II.06/2013 dated 1 July 2013 for the management of mills with acapacity of 120 ton FFB/hour.Compliance status : Full Compliance

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

Company already has a letter from Forestry Department, Regional Office of Lampung Provinceno. 1052/Kanwil-6/TGH 134/90 dated 16 July 1990 stating that the area managed by PT SumberIndah Perkasa, which is located to the East and bordering with permanent production forest ofSungai Buaya Reg.45,is not overlapping with the forest area.Company has a Decree of Governor No. C/202/DA/HK /1989 on Land /Site permit and land usetotaling 9,000 Haunder the name of PT Sumber Indah Permai. After that, there are site permitchanges no. C/309/BPH/HK/1990 to become 9,522.11 Ha.Company previous name is PT Sumber Indah Permai and then changes name to become PTSumber Indah Perkasa. Change in the company name has been notarized by a Notary Deeddated 20 September 1990 (Benny Kristianto and associate) and secured in the Decree of theMinister of Justice no. C2-5826 HT.01.01.Th90./HK/1990.Company already has a certificate of HGU from BPN with no. 1/HGU/BPN/93 totaling 9,522.11Ha dated 30 January 1993.Company already has a certificate of HGU that consists of :HGU issued by the Regency of North Lampung with no. 08.04.15.01.2.00014 dated 21 July 1993



totaling 5,058.82 Ha for the location of SBYE and SBYM.All HGUs will expire in 2027.Company already has IMB no. 642/245/650/600/1995 totaling 5,995.4 M2 for PKS SBYM.Compliance status: Full Compliance

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.

Company is a takeover from earlier company in 1990. Company states that during the periodfrom 1990 until the time of the audit there was no purchasing of land.There is SOP of Land Conflict Settlement (SOP/SPO/SMRT/LH-04). So far the company andKUD inform that there was no dispute during the period from 2010 to the present time in the areaaround company site. It is said in the SOP to prioritize deliberation over legal action.At the time of audit the Location Map of PT. Sumber Indah Perkasa No. Reg:948/214/PMNP/VI/12 with the scale of 1 : 250,000 were showed. The map should have asufficient scale of minimum 1 : 100,000 in accordance with Decree of the Ministry of Forestry No.48/menhut-II/2004.Compliance status : Observation no. 5

3 COMMITMENT TO LONG-TERM ECONOMIC AND FINANCIAL VIABILITY

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

PT SIP long term replanting program up to 2020 has been established. The replanting plan willcommence in 2017 up to 2020 covering 5 estates with a total area of 23,443.87 Ha. Forplantations under the SBYE Estate, including MSJA and GALA, replanting area is determined asfollows :

- 2017 (planting year (TT) 1991) is 513.14 ha ;- 2018 (TT.1992) is 2,720 ha ; and- 2019 (TT.1993) is 1,118 ha ;

Company has financial statement that has been audited by the public accountant office ofTanubrata Sutanto Fahmi & Rekan, in 2011. Tax report data for 2012 was not available yet butthere is a statement letter dated 16 April 2013 issued by the public accountant office that it isunder audit completion process.Compliance status : Full Compliance

4 USE OF APPROPRIATE BEST PRACTICES BY GROWERS AND MILLERS

4.1 Operating procedures are appropriately documented and consistentlyimplemented and monitored

- SOP and WI related to new planting, issued 1/7/2010.- SOP on New Land Opening (SOP/SMART/MCAR/IV/TA-PLB), rev.0, issued 1/9/2012. Point

2.2.6 Preparation regulates on: terracing and horseshoe shaping (tapak kuda).



- There is IK /SMARTR/MCAR/TA-PPA/01 on Drainage- Records of nursery maintenance are not available since there is no longer nursery activity.- SOP/SMART/MCAR/V/TA-TNM, 1/9/2012. SOP on Planting- There is IK/SMART/MCAR/V/TA-TNM/01- Lining Flat to Wavy Area and also guidance (table)

from Plant Density in Flat Area.- In SOP and orWIthe plant density is set at 136/ha.In general, the company already has SOP on Land Preparation Technical Guidelines (Palm Oil)that constitutes a collection of SOP and WI related associated with new planting. issued1/7/2010. SOP on New Land Opening (SOP/SMART/MCAR/IV/TA-PLB), rev.0, issued1/9/2012.Point 2.2.6 Preparation regulates on: terracing and horseshoe shaping (tapak kuda).Also, there is IK /SMARTR/MCAR/TA-PPA/01 on Drainage system.There are SOP on Nursery Bed (SOP/SMART/MCAR/III/TA-BBT, rev.00,1/9/2012) andIK/SMART/MCAR/III/TA-BBT/06, Seedling Acceptance and Planting. But both do not regulatethe use of certified seedlings yet at the time of audit stage I. Nevertheless, at the audit stage IIthe company had issued a Memorandum from VPA PSM2 (D. Sivasanker) No. 001/MEMO-VPAPSM 2/07/2013 dated 1 July 2013 on the use of certified seedlings as evidence of commitmentto the established SOP and WI (conform).There is Form of Oil Palm Seedling Selection (FORM/III/TA-BBT/06-Seedling Acceptance andPlanting /01 Selection.IK/SMART/MCAR/III/TA-BBT/08-PN Selection, starting from selection at 2 months old and attransplanting, counting abnormal seedlings (criteria exists), and documenting/recording/reportingall reject seedlings. Figure 1. Types of Reject Seedlings. Recorded in the form of Pre Nursery OilPalm Seedling Selection Sheet (FORM/III/TA-BBT/08-Seleksi PN/01, rev.00, rejection isclassified into: RL, C, TS, CM, TS, etc.There is no data on planting plan and realization since there is no longer planting activity in allestate areas of Sungai Buaya Estate (SBYE), KKPA Mesuji (MSJA) Estate, KKPA Gedung AjiLama (GALA) Estate. At the time of audit stage I there was no SOP on planting on a peat land.However, at the time of audit stage II verification was made on Work InstructionIK/SMART/MCAR/III/TABDT/06- IK on Planting on a Peat Land Rev.00 dated 26 March 2012 forthe above three (3) estate areas.Compliance status : Full Compliance

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

Sop on Maintaining Unproductive Plants SOP/SMART/MCAR/X/TA-PTBWork Instruction on Plant Census IK/SMART/MCAR/X/TA-PTB/01-Plant CensusWork Instruction on Insertion IK/SMART/MCAR/X/TA-PTB/02-InsertionWork Instruction on Measuring PlantGrowth

IK/SMART/MCAR/X/TA-PTB/03-Measuring PlantGrowth

Work Instruction on Constructing AndInstalling Harvest Ladders

IK/SMART/MCAR/XI/TA-PMP/04-Constructing AndInstalling Harvest Ladders

Work Instruction on MaintainingWeeded Circle, Harvest Path, Control

IK/SMART/XII/TA-PTM/01-Maintaining weeded circle,harvest path, control path and collection path



Path and Collection PathSop on Harvest Preparation SOP/SMART/MCAR/IX/TA-PMPWork Instruction on DevelopingPollinating Weevil

IK/SAMRT/MCAR/XI/TA-PMP/01 - DevelopingPollinating Weevil

Work Instruction on Castration IK/SAMRT/MCAR/XI/TA-PMP/02- CastrationWork Instruction on Sanitation IK/SAMRT/MCAR/XI/TA-PMP/03-SanitationWork Instruction on Constructing AndInstalling Harvest Ladders

IK/SAMRT/MCAR/XI/TA-PMP/04-Constructing AndInstalling Harvest Ladders

Work Instruction on MaintainingWeeded Circle, Harvest Path, ControlPath and Collection Path

IK/SMART/MCAR/XII/TA-PTP/01-Maintaining weededcircle, harvest path, control path and collection path

Sop On Maintaining Productive Plants SOP/SMART/MCAR/XII/TA-PTMWork Instruction on Tree Census IK/SMART/MCAR/X/TA-PTB/01-Tree CensusWork Instruction on MaintainingWeeded Circle, Harvest Path, ControlPath and Collection Path

IK/SMART/MCAR/XII/TA-PTP/01- MaintainingWeeded Circle, Harvest Path, Control Path andCollection Path

Sop on Maintaining Space BetweenPalm Rows

SOP/SMART/MCAR/VIII/TA-PGM

Sop on Weeding SOP/SMART/MCAR/VIII/TA-PGMSop on Maintaining Roads, Drains andBridges

SOP on New Land OpeningSOP/SMART/MCAR/IV/TA-PLB

Sop on Pest and Disease Control SOP/SMART/MCAR/VII/TA-HPTWork Instruction on Pruning andStacking of Fronds

IK/SMART/MCAR/XII/TA-PTM/02-Pruning andStacking of Fronds

Sop on Fertilizing SOP/SMART/MCAR/IX/TA-PPKSop on Harvesting SOP/SMART/MCAR/XIII/TA-PNNAttachment to Work Instruction on RipeFruit Criteria in Mill

LAMP/XIII/TA-PNN/01- Ripe Fruit Criteria in MILL

Work Instruction on Harvest IK/SMART/MCAR/XIII/TA-PNN/01-HarvestSop on Loading and Transporting FFB SOP/SMART/MCAR/XIV/TA-PPTWork Instruction on Loading FFB SOP/SMART/MCAR/XIV/TA-PPT/01-Loading FFBWork Instruction on Transporting FFB SOP/SMART/MCAR/XIV/TA-PPT/02- Transporting

FFBWork Instruction on Installing Nets andSeals

SOP/SMART/MCAR/XIV/TA-PPT/03-Installing netsand seals

There is no TBM maintenance because the youngest is the planting year 2000- TM maintenance includes:(1) Tree census,(2) Maintenance of weeded circle, harvest path, control path, and collection path(3) Maintenance of space between palm rows(4) Weeding(5) Road and bridge maintenance(6) Pest and Disease Control



(7) Pruning and Stacking of FrondsMaintenance activities are recorded in:- Foreman Activity Log (BKM) – daily- Work Outcome Log (BHK) – wholesale.- For main estate, the content of BKM and BHK is inputted into Check roll program (SAP), whilefor Plasma, the BKM is summarized in the Report of Plant Maintenance.Compliance status: Full Compliance

4.3 Practices minimize and control erosion and degradation of soils

Company has protected river border area by clearing free from oil palms with clearance space of50 meter from river edge, and the river banks are planted with bamboo and fertifer grass toprevent erosion. The document is SOP of PT. SIP-GALA/SOP/34 Revision 00 dated 1 March2012. The details of rivers location and condition are described in Criteria 5.2 (HCV).Compliance status: Full Compliance

4.4 Practices maintain the quality and availability of surface and groundwater.

Revised ANDAL Document of AMDAL of Oil Palm Plantation and Oil Palm Processing into CPO,sources of water from Sungai Buaya and Sungai Merah. There are 3 drilled wells. The depth ofdrilled wells are 10-15 meterCompany already has SIPA permit from the Government of Mesuji Regency, the Mining andEnergy Department, No : 540/06/SPKTS-SIPA/III.14/MSJ/IV/2013, ± 100 m depth drilled wellpermit, covering Mesuji Estate and Sungai Buaya Estate, 7 April 2013Water needs for Mill 1 ton TBS are 1.5 m3 of water, for domestic needs are 100 m3/day, so withmill with a capacity of 60 ton TBS per hour, the total use of river water is 2,800 m3/day.The efficiency of water use for processing in the SBYM in 2013 from January to April is 0.712 m3

per ton TBS.The efficiency of water use for processing in the SBYM in 2012 from January to December is0.905 m3 ton TBS, where the target of 1.5 m3 per ton TBS has been achieved.Areas at Buaya River and Tapa River have been planted with bamboo to prevent erosion.The results of surface water measurement can be found in RKL and RPL that cover SungaiBuaya, Sungai Merah mill, and 4 resident wells.Organization has measured the quality of clean water in the resident wells with 4 resident wellsampling points. The results of clean water quality measurement of resident well number 3 isbelow the BML = 50 for coliform biological factor, for pH the resident well number 1 and 4 arebelow the BML = 6.5 - 9Company has measured the SBYM liquid waste, with results is appropriate with therequirements of KepMenLH No. 29 of 2003. Routine measurement is conducted every 6 monthsaccording to the activity in the RKL and RPL that conduct measurement and reporting every 6months to BLH of Mesuji Regency, BLH of Lampung Province, and KLH Jakarta (SBYM), and toBLH of Tulang Bawang Regency, BLH of Lampung Province, and KLH Jakarta.Organization conducted environmental measurement during the period of Semester I of 2013that covers surface water and groundwater. For the SBYM area it covers Tapa River. Theregulatory references are the Regulation of the Governor of South Sumatera No. 16/2005



(Attachment I). The measurement results do not exceed the Environmental Quality Standardrequirements yet. The results will be reported to the government in accordance with RKL andRPL requirements.On 1 May 2013, the organization conducted the measurement of Tulang Bawang river upstreamand Tulang Bawang river downstream in Gedung Aji Lama KKPA, executed by SMARTResearch. The results of river water analysis, SMARTRI-Form-PSM-27-01, revision: 00.Measurement results are in accordance with BML.On 20 May 2013 the organization conducted measurement of surface water quality in the area ofMSJA and GABA, by Environmental Laboratory, Environmental Body, the Government of SouthSumatera Province. This body also has obtained KAN accreditation as an environmental testinglaboratory. The measuring standards are the Governor Regulation No. 16/2005.Compliance status: Full Compliance4.5 Pests, diseases, weeds and invasive introduced species are effectively

managed using appropriate Integrated

The company has the SOP on Plant Disease and Pest Control (SOP/SMART/MCAR/VII/TA-HPT, 1/9/2012)The data found for IPM program at SBYE, KKPA Mesuji and KKPA GALA:

(1) rat census 2012-2013, carried out quarterly,

(2) UPDKS (Oil Palm Leaf Eating Caterpillar), monthly since 2009-2013.

(3) Maintenance of Bio controls Plants (APH), 2009 – 2013, monthly, covering: Turnerasubulata, Antigonon sp. and Nephrolephis biesserata.

(4) Census officer, there are 3 personnel for each division (SBYE) – there is caterpillar censusimplementation. The officer has been trained and supporting data such as photographs,attendee list, trainer from Regional Research Unit, Integrated Pest Control Training Module.

(5) Sprayers, for SBYE there are 2 groups @24 personnel. For GABA there are 1 group @10personnel. There is evidence of Training Attendee List of Restricted Pesticide Use, 18/10/2011for SBYE and GABA. There are 64 attendees.

(6) Training for Sprayer (SOP and WI), evidence such as attendee List of on 27 /4/2013.

There is SOP on Plant Disease and Pest Control (SOP/SMART/MCAR/VII/TA-HPT, 1/9/2012).

Compliance status: Full Compliance

4.6 Agrochemicals are used in a way that does not endanger health or theenvironment. There is no prophylactic use of pesticides, except in specificsituations identified in national Best Practice guidelines. Where agrochemicalsare used that are categorized as World Health Organization Type 1A or 1B, orare listed by the Stockholm or Rotterdam Conventions, growers are activelyseeking to identify alternatives, and this is documented

Handling of Pesticide WasteThe registered company collected used pesticide packaging of jerry cans and plastic bottles



made of Polymex material.Non polymex material is collected in a special warehouse after being handled in accordance withWIon Washing and Cleaning of Pesticide Packaging’s and Fertilizer Bags, SIP-SBYEIK/19, No.Revision: 00 approval dates 1 March 2012.Companyhas provided facilities for mixing pesticide,washing used pesticide packaging’s, washing used Fertilizer Bags, washing pesticide apron, andbathroom for sprayer personnel.SBYE, MSJA KKPA & GALA KKPAAt the time of audit stage I there was still waste water from sprayer bathing activities flowing intopublic sewer at SBYE. The organization has repaired it and directed the effluent from sprayerbathing activities into a septic tank.Pesticide hazard warning signs have been displayed in washing facilities in all areas.Used pesticide packaging’s already washed are stored in a special warehouse (which alsocontains used paint and thinner cans) and picked up by Hazardous and Toxic waste collectorservice company PT Primandu Jaya. The company has obtained Hazardous and Toxic wastecollector and transporter permit from the Ministry of Transportation, Directorate General of LandTransportation for transporting Hazardous Materials, No. AJ.309/50/019/DJPD/2012/36005114.Pesticide waste handling is already regulated in pesticide work instruction, WIon Washing andCleaning of Used Pesticide Packaging’s and Fertilizer Bags, SIP-SBYEIK/19, No Revision: 00with approval date of 1 March 2012. However, it is written in the WI that the collection place is inTPS Hazardous and Toxic, whereas in implementation not in TPS Hazardous and Toxic but in awarehouse in which there are also used paint and thinner cans. Company needs to providehazardous waste warning signs in the warehouse.In the bathing room for sprayers after completing their tasks in MSJA, the water flows to a septictank.In GALA, waste water from sprayer bathing room is flowing to a septic tank.Company already has a list of agricultural and forestry pesticide recommended by PesticideCommission of the Republic of Indonesia both synthetic and natural for weeds and caterpillarssuch as, among others, synthetic herbicide Rolixon, Gromoxone, Roll up and natural insecticideCordiceps for ulat api pest control. However, company should reduce the use of herbicide ofparaquat active substance (restricted pesticide), and use herbicides for weeds that are powerfulbut safe for operators in the long run (observation).Compliance status: Observation no. 2

4.7 An occupational health and safety plan is documented, effectivelycommunicated and implemented

Company has established and implements occupational safety and health management systemto fulfill the obligation as per government regulation. Evidence of implementation found asfollows :- Has established Occupational Safety, Health and Hygiene Policy of PT. SIP – Lampung

Region, dated 2/9/2011. The policy was signed by the officials of RC, PC, and PUKSPSI. Thepolicy goal is continually seeking to reduce hazards leading to work accidents that result ininjuries, work related diseases, goods damage, fire and explosion as well as productionprocess disruption and environmental pollution. Socialization of OSH Policy is carried out inclass, through training, meetings, morning calls, morning circles, as well as displayed in the



workplace.- Company has had and established OSHAS documentation that includes OSHAS Manual,

SOP/Procedures, Work instructions and forms that has been implemented per 1 July 2010.Currently, most of documentation has undergone revision once.

The company has the Organizational structure and personnel in charge of OSH aspects, i.e.OSH Officer. In order to comply with government regulatory, the Company has establishedP2K3 team in each Unit, consists of General OSH Expert (AK3U) who serves as the Teamsecretary and team leader which are the Unit’s Manager. All P2K3 Teams have obtainedapproval from local manpower agency. The approval data are as follows:SBYM :

P2K3 Team was established with SK No. 560/8/III.04/MSJ/P2K3/III/2013 dated 22/10/2010 byMesuji Manpower and Transmigration Service. The Secretary is Hermawan Berliana withappointment letter No. SKP.1554/DJPPK/AK3-U/VII/2010, dated 26/7/2010.

SBYE :

Division II, Blok 14 - 15

P2K3 Team is valid for 2013-2015 period, with approval of SK No.560/46/HIPK/II.TB/P2K3/IV/2013 dated 15/4/2013, from Social, Manpower and TransmigrationService of Tulang Bawang Regency. The Secretary is Piki Ardiansyah, as AK3U, withappointment letter No. KEP.4120/M/DJPPK/I/213 dates. 7/1/2013.

PPE has been equipped by the company such as: boat, helmet, glass for all harvesters.

GALA KKPA :

P2K3 Team has obtained approval from Social, Manpower and Transmigration Service ofTulang Bawang Regency with No. Kep:560/36/HIPK/II.TB/P2K3/IV/2013 with SecretaryIfriansyah as General OSHExpert.

MSJA KKPA :

P2K3 Team has obtained approval from Social, Manpower and Transmigration Service ofTulang Bawang Regency with No. Kep:560/45/III.04/MSJ/P2K3/6/2013 dated 10 June 2013 withSecretary Hendri Kustiwan. Appointment Letter No. Kep: 2266/M/DJPPK/X/2011 dated 6October 2011.

P2K3 Team has been conducting routine monthly meetings, on a regular basis. Minutes ofmeeting are already listing the topics, description of meeting/discussion results, due date ofsettlement follow up (start, finish), and PIC. The completion status of each case complete withcompletion date, and if not yet completed then sit will be brought to the next meeting.

All work units under PT. Sumber Indah Perkasa has included its employees in the SocialSecurity Program (Jamsostek), starting from daily wage workers (BHL), PKWT, and SKU. Theprogram varies in package according to the employee status. Those with BHL status will beincluded after 3 consecutive months because their status rises to Daily-SKU (SKU-H).Employees with SKU-H and PKWT status are only included for ½ packages, i.e. only JKK andJKM, where as employees with Monthly-SKU (SKU-B) and SKU status up to staff get full



package programs, namely: JKK, JKM, JHT, and JPK. List of Jamsostek membership is storedand recorded on manpower data base, and already has KPJ Number. But PKWT in particular,does not have KPJ number. The Jamsostek Insurance is not willing to give KPJ Number forreasons of non-permanent status.

The company has conducted worker health examination of BHL, PKWT, and SKU. Evidence ofexamination can be shown as follows:1) There is a recapitulation of staff and employee health examination results in 2013: (a). SMRM,examination date: in stages from the 2nd to 5th month of 2013, for 168 workers (SKU+PKWT).(b). SBYM, examination date: in stages from 2nd to 4th month of 2013, for 88 workers. Those notyet examined are planned to be examined in July, 2013. (c). SMRE, examination date: in stagesfrom 2nd to 4th month of 2013. And (d) SMRE, examination date: in stages from 2nd to 4th monthof 2013.Company has issued a Policy for medical examination, on Lampung Region Worker HealthExamination, approved by the Regional Controller and Production Controller, dated 1/6/2011,containing prior-employment, periodic, and specific examination. During preliminary audit, theexamination of cholinesterase aspect has not been conducted for workers who work closely withHazardous and Toxic, such as: sprayers, Hazardous and Toxic waste officers, chemicalwarehouse and laboratory officers. Application for this examination has just submitted. Also forpersonnel working in the noisy area, the audiometry measurement has not been conducted. Atthe time of the audit stage 2, company has been conducting cholinesterase and audiometryexamination for these personnel. Spirometry examination should also be programmed forsprayers, Hazardous and Toxic waste, chemical warehouse and laboratory personnel.The company also provides health care service by establishing a Clinic located in the SBYECentral Office. The clinic had received permit from the Department of Health of Tulang Bawangwith Private Health Care Service License No. 455/503/014/SIT-BP/DK-TB/III/2004, dated19/3/2004 and valid until 01/4/2007. License reapplication is currently under process inconnection with the regency expansion so that the status of the clinic becomes under the MesujiRegency. The clinic is led by a company doctor and a paramedic, both are medical certified.Employees have medication in the clinic free of charge, for both PKWT and BHL status. Theservice also covers the employee’s family.There is a Procedure for Hazard Identification, Risk Assessment and Risk Control (HIRARC)(No. SOP/17/SMART/LH-02, Rev. 01). Company has conducted ISBPPR that covers the wholeEstate and Mill. The IBPPR results are recorded in Risk Analysis Form (FP 11/17-SOP-02) andRisk Analysis Follow up Form (FP 11/17-SOP-02). The reference for preparation is the ASNZmethod. Preparation of ISBPPR for Estates covers from maintenance (fertilizer, spraying, spacebetween palm rows, OPT, roads), harvesting, emplacement maintenance, warehouse, workshop(all machinery), clinic, central office, washing place for keep and Fertilizer Bags (showersprayers).As for Mills, it has covered the entire process from transport, security, weighbridge, TBS grading,loading ramp, transfer carriage, sterilizer, tippler, thresher, press, clarifier, boilers, kernel,engineering, effluent, workshop, warehouse, Hazardous and Toxic warehouse, diesel fuel tank,lab, office, CPO dispatch, machine unit installation, fire engines, and vehicle traffic. ISBPPR isreviewed annually to see the effectiveness of earlier risk control application. If deemednecessary, the additional control will be added until "low" (L) risk level is achieved. This activity iscarried out together between the operating officials and the P2K3 Secretary and Chairman.In each Unit company has conducted a number of training related to safety and health (OSH)



aspects, some of which can be reported as follows:SBYE, MSJA and GALA Units:- First aid Training, 21/5/2013, by dr. Wiyangga, from the clinic. 6 participants (4 foreman and 2

assistant clerks), materials include simulations on how to deal with accidents.- Socialization of ISCC, ISPO, RSPO, OSH, P3K, APD, MSDS, on29/05/2013. There were 13

participants. The presenter was OSH officer.- Socialization of procedure for handling natural disaster and fire (KTD), on 16/03/2013.

Participants were 7 security personnel.- First aid Training, combined participants of Regional level, totaling 75 participants, on

10/10/2011.- General OSH Expert for P2K3 secretary.- Restricted pesticide use training, on 18/10/.2011, participants from SMRE with a total of 67

participants, on 19/10/2011. There was “Restricted Pesticide User Certification” from theDepartment of Agriculture, Food Crops and Horticulture of Lampung Province.

- Special skill training, including: welder and heavy equipment operator license.

SBYM Unit :- First aid Training, 21/5/2013, 11 participants (4 foremen, 1 security personnel, book keeper, 2

analysts, nurses, P2K3 secretary, cashier).- Socialization of MSDS on 14/5/2013 at SBYM to48 workers by OSH officer.- Special skill training, including: welder and heavy equipment operator license.

Company has developed and established SOP related to fire prevention and mitigation, i.e.:- SOP on Emergency Handling (SOP/SMK3/SMART/LH-09), applicable in Estates and Mills.- Technical guidelines for dealing with emergency situation in the form of Emergency Response

Mechanism Diagram contained in form of FP 02/SMK3-SOP-10, according to conditions, i.e. :(1) Fire(2) Hazardous and Toxic Spill Handling(3) Earthquake(4) Chemical Poisoning through Ingestion.

These SOPs have been effective since 1 July 2010.Socialization has been carried out to allworkers by means of displaying at strategic locations, such as: Estate office, division office, Milloffice, workshop, and parking area in the form of banners or billboards.

Company has established Emergency Response Team by appointing its personnel. Thecapacity to prevent and mitigate fire is sought to by providing the following training :

- SBYM Unit, some of the Dry Powder Squad members have attended training in the use ofportable extinguishers (Light Fire Extinguisher), dated 20/11/2010, but, only 2 out of the 7squad members, i.e. Sudarso and Sugiarto.

- GALA Unit, Light Fire Extinguisher training has been conducted as seen in the List ofAttendees of Light Fire Extinguisher Training, dated 7/6/2013. But, out of the Light FireExtinguisher Team members, there is one not yet attending the training i.e. Sulisiyanto.

- SBYE Unit, some of the Light Fire Extinguisher Team members have attended Light FireExtinguisher training on 29/05/2013 and 20/11/2011 in Division 1 office. But out of that numberof Light Fire Extinguisher Team the TTD/ERP Structure has not received training.

- MSJA Unit, Light Fire Extinguisher training has been delivered on 20 June 2013, which isattended by all Light Fire Extinguisher Team members.



Company has provided fire control/mitigation facilities and infrastructures as follows:- SBYM UnitIn the Checklist of KTD Equipment dated 3 June 2013, it is recorded :(1). 35 Light Fire Extinguishers in 35 locations;(2). 4 units of pillar hydrant and 4 boxes of corresponding equipment (hoses and nozzles) at 4strategic locations at St. Sterilizer, St. Boiler, St. Kernel, and St. Clarification;(3). Sandbag along with spades at 4 locations; and(4) Eye washers and showers in 5 locations (lab, CaCO3 warehouse, LB-3, oil warehouse andWTP). Company also has developed Evacuation Map and Map of Fire Sensitive Area providedwith location points of Light Fire Extinguisher, hydrant, eye washer/shower, direction arrow ofevacuation route, and 2 assembly points. It is suggested the company completed the informationon important telephone numbers to be contacted in the case of emergency.- SBYE, MSJA and GALA UnitsIn the Summary Report of Light Fire Extinguisher checking dated 28 May 2013, it was found :(1). 41 Light Fire Extinguishers distributed in 41 locations in the entire estate area coveringcentral office, fertilizer warehouse, diesel fuel warehouse, oil, spare part, LB3, division office,mess, staff housing.(2). 1 unit of water tanks, 1 portable water pump provided with hoses and nozzles/guns.Company has conducted routine inspection of Light Fire Extinguisher and hydrant and recordedthe results using PMKS Patiware Light Fire Extinguisher and Hydrant Monitoring form, whichthat is carried out monthly. There is evidence of implementation for December 2012 andJanuary 2013. This activity is carried out by workshop foreman, verified by assistance workshopand acknowledged by Mill Manager.In dealing with emergency situation, company has established Emergency Response andPreparedness (ERP) as follows:- Emergency Response and Preparedness Organizational Structure has been established for

each Unit, covering SBYM, SBYE, Mesuji and GALA. The KTD structure was developed byP2K3Secretary and approved by P2K3 Chairman (Unit Manager). The structure is composedof Team Leader, Deputy Team Leader, General Assistant, Executive Chairman, Secretary,Fire Extinguishing Team (Dry Powder, Hydrant, Sand, Wet burlap, Hook), Evacuation Team,Security Team, Connecting team, Eliminating Team, and Health Team.

For SBYM mill area, company should have fire mitigation officers in accordance with theprovisions of the Decree of the Minister of Manpower No. 186/MEN/1999. Based on Annex 1and 3, a processing plant (Mill) is classified as vegetable oil mill with Moderate Fire Potential III.A factory with a total workforce of over 100 people should have fire mitigation officers: 1 forclass A, 1 for class B, 5 for class C, and 12 for class D. At the time of the audit stage 2, theCompany had carried out Fire Simulation Training, dated 05/07/2013 from the Department ofSocial, Manpower and Transmigration, Tulang Bawang, to 20 people. However, this is only afulfillment for class D. Company is strongly encouraged to comply with these provisions andrequired to program it in subsequent years.

Company has conducted various efforts related to fire prevention and mitigation, and kept therecorded report properly. Activities carried out in various unit areas (Estates and Mills) are asfollows:SBYM Unit:- Fire simulation was conducted on 5/6/2013.- Routine inspection of emergency response equipment such as: Light Fire Extinguisher,



hydrant, and sand burlap from every two week to once a month. This activity is conducted byTTD members, or SPO Officer, or P2K3 secretary.

SBYE, MSJA and GALA Units:- Wildfire simulation was conducted on 24/3/2012 and in mid July 2013, regional level participant

unit, 68 participants. There is scenario, evaluation, photos, and attendee list.- In GALA, simulation was conducted for potential earthquake and fire emergency situation,

dated 25/6/2013, in the location of Central Housing, complete with scenario and evaluationbut simulation for chemical spill mitigation is not yet conducted.

- Patrol activity is conducted by Security Team to monitor HCV and wildfire, recorded in thePatrol Book per 2 weeks.

- Creating fire breaks in the area bordering the community plantations and or being firepotentials, in each division – Unit.

- Develop Division’s Fire Vulnerable Area Map.- Provide list of phone number both internal and external including for local police, local military,

hospital, fire brigade.- Routine inspection of emergency response equipment, such as: Light Fire Extinguisher,

hydrant, and sand bag from 2 weekly to monthly. This activity is conducted by ERPmembers, or SPO Officer, or P2K3 Secretary.

- Report fire prevention to the Department of Social, Manpower and Transmigration every 3months,

Company has provided equipment related to OSH aspect, including PPEfor the workers. Beloware some data that can be reported through sampling:- SMRM Unit, there is certificate of acceptance for: (1) leather gloves (2) safety shoes-workshop

for 25 people, on 9/2/2013, (3). Helmet on 15/1/2013, 5 people, (4 Boots on 4/2013, for 4people,

- SMRE and GABA Units, there is a list of name of PPE recipient in Div.4, certificate ofacceptance dated 24/5/2013, of AP Boots (7 people), sprayers: rubber gloves, AP boots, mask(12 people), harvesters: AP boots, helmet, safety glasses, sickle covers (27 people).

Company has an effort to fulfill with P3K provisions. Work sites have been provided with first aidkits, though some of them are not complete in accordance with the regulatory requirements. Inthe field, every foreman such as harvest and sprayer foreman carry small first aid kits containingthe required medicine. All foremen have received first aid training from company doctor. Also, ineach Unit (both Estate and Mill), a number of first aid officers have been appointed based on theLetter of Decision on Appointment of First Aid Officer signed by P2K3 Chairman or UnitManager.

Company has established SOP on Handling of Work Accident (SOP/SMK3/SMART/LH-10,1/7/2010), starting from handling accident in a worksite, handling of mass accident, reporting,investigation and recovery. There are evidence of implementation of reporting and investigationfor accident occurred, among others:(1). Work Accident Report 1/24 hours (FP 01/SMK3-SOP-10). For example, for SBYE, accident

date is 29/05/2013, Paryanto (NIK 09018), reported on 30/5/2013.(2). Accident Investigation Report from the Assistant (FP 02/SMK3/-SOP-10).

Other records related to accident recording are: (1) Recapitulation of Accident Report EveryMonth (FP 03/SMK3-SOP-10), and (4). Recapitulation of SR and FR Counting (FP 04/SMK3-SOP-10).



On Saturday 11 May 2013, an accident occurred to a plane of Fletcher type conducting airmanuring on oil palms. According to the explanation of Mr. Humala Sinaga (Lampung RegionalController), the results of investigation of accident of plane coming from Air Manuring Divisioncould not be obtained because of PT. Sumber Indah Perkasa (SIP) is just as a lessee whoprovides fertilizer and aircraft runway. Investigation is immediately undertaken by the NationalCommission for Transportation Safety (KNKT) on Sunday 12 May 2013 or a day after theincident with a note that parties who want the result of the investigation are asked to contactKNKTdirectly.Compliance status: Observation no. 3, 4, & 84.8 All staff, workers, smallholders and contractors are appropriately trained.

Company has established annual training programs. Training activities are based on SOP on HRDevelopment Training (SOP/SPO/SMART/LH-10, 1/7/2010, rev.01), covering: preparation,implementation, and evaluation. There is Training Need Analysis set by Regional TrainingCenter Coordinator (RTCC) and the results are in the form of Training Need Identification Matrix(FL/Estate/TRAD/10), prepared by SPO Officer, and approved by Estate Manager. The Matrixesdeveloped by SBYM, GALA, and MSJA units.

Annual training program is prepared and established by respective Unit. For 2013, it is:

- SBYM and SBYE: P2K3 Training Program of PT Sumber Indah Perkasain 2013, preparedand established by P2K3 Secretary, and P2K3 Chairman. Also, there is P2K3 TrainingProgram (for Sustainability areas) covering: OSH, Environment, social, HCV, greenhousegas emission, sexual harassment, and PHT.

- GALA and MSJA: Training Program 2013, signed by person in charge of SPO Unit andapproved by Unit Head as per 05/01/2013. Training materials include: P3K, proper,socialization/training of ISCC, ISPO-RSPO, PHT, harvesting, HCV, Kompes, procedures &WI, PPE, Hazardous and Toxic waste control, GHG mitigation, GHG emission calculation,prevention of sexual harassment, socialization of communication and consultation,socialization of SOP on contractor control, socialization of jamsostek to contractors.

All records showing evidence of training implementation, such as: attendee list and photographs,and certificate are kept by KTU, while training records for sustainability are also kept by SPOOfficer. Each Unit records training realization. For example, in GALA as well as MSJA Units. It isrecorded in Training Recapitulation form that includes information: name of training, instructor,participant, implementation time, and training location.

Company is deal with trained contractor personnel. As mentioned in the above training program,each contractor of SBYM Mill, SBYE Estate, as well as GALA and MSJA Unit has been providedwith related to RSPO, which includes :

- Socialization on appeal to include their workers in jamsostek, to care with environmentalsustainability, protect biodiversity, implement OSH in the form of PPE use, encouragement tocomply with OSH regulations, and being in harmony with the community.

- Socialization on wage system and worker’s age that must not be <18 years old and minimumwage regulations.

- Socialization on PPE: PPE mandatory, PPE benefit, encouragement to always follow OSHregulations—especially drivers and loading personnel.

- For TBS transport contractors, evidence of being trained is demonstrated by driving licensepossession.



- Some contractors for road maintenance and housing have been selected in a strict mannerthrough pre-bidding process from the aspect of willingness to comply with OSH aspect,employment aspect, as well as technical aspect according to type of work to be done.

In GALA, two SPKs are found not expresivvely specifying the provisions of PPE mandatory use.They are SPK no. 027/GALA/JKTO/04/2013-Box Culvert and SPK no. KUD-KS/GALA/SPKL-L/January-12-/010-FFB Transportation and Loading.

Compliance status: Observation no. 9

5 ENVIRONMENTAL RESPONSIBILITY AND CONSERVATION OF NATURALRESOURCES AND BIODIVERSITY

5.1 Aspects of estate and mill management, including replanting, that haveenvironmental impacts are identified, and plans to mitigate the negative impactsand promote the positive ones are made, implemented and monitored, todemonstrate

Company conducted impact analysis in the Revised ANDAL document of AMDAL of Oil PalmPlantation and Oil Palm Processing into of CPO PT Sumber Indah Perkasa with an land area of9,254 Ha and MILL with the capacity of 60 ton FFB/Hour No. Document is16/KOMDAL/11.04/IV/2008 dated 14 April 2008.In ANDAL document the scope of environmental impact analysis is oil palm plantation activityand processing into crude palm oil (CPO). The scope of environmental impact analysis is SungaiBuaya Estate, Sungai Merah Mill and Estate, Geng Aji Baru Plasma, Gedung Aji Lama Plasma,Mesuji Estate, Sungai Buaya Mill, and Sungai Merah Mill. In ANDAL document, theenvironmental impact analysis is still scoping company current activity and condition.Environmental impact management is contained in RKL and monitoring plan is contained inRPL. The RKL and RPL is implemented every 6 months and report every 6 months to BLH ofMesuji Regency (SBYE, GABA, MSJE, SBYM), Tulang Bawang Regency (SMRM, SMRE,GALA, GABA)ANDAL Document also covers land biodiversity in the form of flora and fauna (biological aspect),social cultural aspect to the population of villages around unit and division.Compliance status: Full Compliance

5.2 The status of rare, threatened or endangered species and high conservationvalue habitats, if any, that exist in the estate or that could be affected by estateor mill management, shall be identified and their conservation taken intoaccount in management plans and operations

Company has had SOP on Identification and Management of HCV No.: SOP/NP/SMART/IV/LH001 No. Revision 01 effective date 1 July 2010.Company has had the revised ANDAL document of AMDAL of Oil Palm Plantation and Oil PalmProcessing into CPO of PT Sumber Indah Perkasa with a total area of 9,254 Ha and Mill with acapacity of 60 ton FFB/hour that scopes environmental conditions related to flora and fauna.Information in ANDAL document prior to planting, the flora identified is commercial crops such asmeranti wood and there is no identification of fauna prior to planting. In ANDAL document thereis flora and fauna identification after the land becomes oil palm plantation and oil palm mill, forflora it is palms and bushes, for fauna it is buaya, ular sendok, tikus, landak, babi hutan, macan



akar, etc. The land’s baseline condition is a secondary forest. There is no information in ANDALdocument about flora and fauna condition when it was still a secondary forest.Company has performed identification of areas with high conservation value along with a teamthat has obtained approval from RSPO Board and the report of identification of high conservationvalue area has been peer reviewed by Resin Sözer, an independent body approved to do peerreview of high conservation value (HCV) area.Company has the Final Report of Identification and Analysis of the Existence of HighConservation Value Area (HCV) of each unit. At the stage I and stage II, the Final Report ofIdentification and Analysis of the Existence of High Conservation Value Area (HCV) of SungaiBuaya Estate, KKPA Gedung Aji Lama (GALA) Estate and KKPA Mesuji (MSJA) Estate isshown. In Sungai Buaya Estate it covers the border area of Sungai Buaya, the border area ofSungai Tapak, Lake Dasiem, reptile fauna, mammals, Aves, and so on. Protection of river borderis to clear it from oil palms with a clearance space of 50 meter from the river edge, and the riverbanks are planted with bamboo and vertiver grass to prevent erosion. For fauna protection,company places communication boards of hunting prohibition in several areas where faunaoccurrence is identified though through footprints (macan akar and babi hutan).HCV identification was conducted in the oil palm plantation area of SBYE unit (4°5’ - 4°17’ S and105°26’ - 105°39’ E).The working area of PT. Sumber Indah Perkasa is 5,058.82 Ha withplanting years of 1991, 1992,1993 and 2000. GALA Unit has the area of 5,005.25 Ha withplanting years of 1995, 1996, 1997 and 1998. MSJA Unit has the area of 5,209.63 Ha withplanting years of 1995, 1996, 1997 and 1999.Data of flora and fauna prior to planting are contained in Initial Environmental Examination of(PIL) Document of Oil Palm Plantation Project of PT. Sumber Indah Perkasa, Mesuji District andMenggala District, North Lampung Regency which is prepared by PT. Mulia Consultants. Data offlora diversity consists of:Cover Crops (Base Vegetation), among others:- Alang – alang (Imperata cylindrical)- Rumput Bendera (Eleucine indica)- Putri Malu (Mimosa invisia)- Pakis (Alsophila sp)- Rumput Merdeka (Paspalum sp)

Trees, among others: Pala Hutan (Myristica sp) Beringin Hutan (Ficus benyamina) Karet (Hevea brasiensis) Bambu (Bambusa sp) Pule (Gudrania sp)

Aquatic Flora around the project location of PT. Sumber Indah Perkasa, among others: Ganggang Hijau (Chlorophyta) Enceng Gondok (Eichornia grassipes) Palam (Corypha sp) Teratai Putih (Nelumbium sp) Pakis Air (Ceratopteris sp) Lumut (Bryophyta)

Data of terrestrial fauna diversity in the project location of PT. Sumber Indah Perkasa prior toplanting includes:Aves



Manyar (Ploceus manyar) Tekukur (Streptopelia sp) Jalak (Strurnus contra) Emprit (Lanchura sp) Cucak Rowo (Pycmonotus sp) Elang (Bustantur sp)

Mammals Gajah (Elephan sp) Kijang (Cervis timorensis) Babi (Sus vitatus) Beruang (Urus sp)

Reptilia Ular Piton (Phyton sp) Kadal (Mobvia multifaciata) Ular Sawah (Phyton molurus)

Insect Kupu-kupu (Papilio sp) Capung (Gomphus sp) Kumbang (Aryetes sp)

In the Gedung Aji Lama (GALA) KKPA there is HCV 6, i.e. old cemetery such as Bangunrejo oldcemetery, Rejomulyo public cemetery, and also HCV 1.2 of protected animal species. In theMesuji (MSJA) KKPA there is HCV 6, i.e. old cemetery such as old cemetery Block B11, andalso HCV 1.1, 1.3, 4.1 of Lake Dasiem, but there are still oil palm stands less than the clearancespace of 50 meter from river banks, because the KKPA Mesuji (MSJA) Estate is the communityplasma but Agrochemical use is restricted to 50 meter from the lake Dasiem shoreline. Thefollowing is details of Identification and Analysis of the Existence of High Conservation ValueArea (HCV) of Sungai Buaya Estate, Gedung Aji Lama KKPA and Mesuji KKPA:

HCVType Field Identification Result

Division/Block/Location of

FindingsArea(Ha)

Sungai Buaya Estate

1.1 ; 4.1

There is area of river border or riparian ecosystem ofSungai Buaya and Sungai Tapak which functions tosupport local protected areas, water sources andflood control.

Sungai Tapakriver border 47.30

1.2

There are protected animal species:1. Elang Hitam (Ictinaetus malayensis)2. Cangak Abu (Ardea sumatrana)3. Cangak Merah (Ardea purpurea)4. Suku Alcedinidae (Raja Udang Biru, Cekakak

Belukar, Cekakak Sungai and Pekakak Emas)

Sungai Buayariver border andinside theplantation -

Mesuji KKPA1.1 ; 1.3

; 4.1

There is area of river border or riparian ecosystem ofSungai Buaya and Sungai Tapak which functions tosupport local protected areas.

Lake Dasiem5.42

1.2 Endangered/protected species in the list ofGovernment Regulation No. 7/1999 (Protected) and

Mesuji (MSJA)KKPAEstate and -



IUCN LC ver 3 (2010), include :1. Raja Udang Biru (Alcedo coerulescens)2. Cekakak Belukar (Halycon smyrnensis)3. Blekok Sawah (Ardeola speciosa)4. Kuntul Kerbau (Bubulcus ibis)5. Raja Udang (Alcedo meninting)6. Cangak Laut (Ardea purpurea)7. Cangak Merah (Ardea sumatrana)8. Elang Tikus (Elanus caeruleus)9. Cekakak Sungai (Todirhamphus chloris)10. Macan Akar (Felis bengalensis)

surroundingareas

6 There is old cemetery Old CemeteryBlok B-11 -

Gedung Aji Lama KKPA

1.2

Endangered/protected species in the list ofGovernment Regulation No. 7/1999 (Protected) andIUCN LC ver 3 (2010), include:1. Raja Udang Biru (Alcedo coerulescens)2. Cekakak Belukar (Halycon smyrnensis)3. Blekok Sawah (Ardeola speciosa)4. Kuntul Kerbau (Bubulcus ibis)5. Raja Udang (Alcedo meninting)6. Cangak Laut (Ardea purpurea)7. Cangak Merah (Ardea sumatrana)8. Elang Tikus (Elanus caeruleus)9. Pekakak Emas (Pelargopsis capensis)10.Cekakak Sungai (Todirhamphus chloris)11.Macan Akar (Felis bengalensis)12.Tupai Tanah (Lariscus insignis)13.Buaya Muara (Crocodylus porosus)14.Biawak (Varanus sp)

Gedung Aji Lama(GALA) KKPAEstate andsurroundingareas

-

6

There are cemeteries:1. Bangunrejo Old Cemetery2. Rejomulyo Public Cemetery3. Karyamakmur Public Cemetery4. Pasar Batang Public Cemetery5. Bangunrejo Public Cemetery6. Panca Tunggal Jaya Public Cemetery7. Infant Cemetery

GALA unit area:- Block A-19- BlockB-26- BlockC-41- BlockC-06- BlockD-12- BlockA-29- BlockA-59

-

HCV monitoring is conducted every 2 weeks. Document used is Patrol Log Book which issummarized into HCV Monitoring Form No. Document F/SMART/LH003/09 every 6 months. Inaddition, there are documents:

Erosion Control Crop Planting Report HCV Area Patrol Report Boundary Peg Maintenance Report Water Level Report Socialization Invitation HCV Socialization Report



HCV Monitoring Form has specified recommendations for improvement as well asrecommendations based on routine monitoring carried out every 2 weeks, but Person in Charge(PIC) and a due date for the completion of recommendation should be determined to see theprogress of follow up to HCV monitoring results.Compliance status: Observation no. 6 & 7

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

Company performs impact analysis in the revised ANDAL document of AMDAL of Oil PalmPlantation and Oil Palm Processing into CPO of PT Sumber Indah Perkasa with a total area of9,254 Ha and 2 Mills with a capacity of 60 ton FFB/Hour.SOP of Waste Management, SOP/SPO/SMART/LH-09, revision: 00 approval date: 1 July 2010,covering mill waste: solid, liquid, gas (including LB3).Plantation : ex pesticide packaging’s, land application, ex agrochemicals (such as fertilizer bags)Current practice of waste flow rate measurement is only on waste that flows out directly from themill to Land Application recorded using flow meter every 7o’clock in the morning and at the timewhen pumping is finished.Company has Extension Decree of Permit to Utilize Oil Palm Industrial Effluent on Soil with theDecree of the Regent of Mesuji No.: B/161/I.02/HK/MSJ/2011, dated 29 July 2011 with validityperiod of 3 years. Effluent managed in the waste water treatment installation is directed to theland for land applicationCompany performs ambient air and emission quality measurements (mobile and non-mobilesources). None of the measurement results exceeds the BML. Company reports themeasurement results every 6 months to BLH of Mesuji Regency (SBYM), BLH of LampungProvince, and Jakarta KLH, with evidence of their receipt. Liquid and Hazardous and ToxicSubstance waste results are reported every 3 months.In SBYM the Company has 4 effluent ponds. SBYM internal daily measurement covers theparameters of pH, Alkalinity, and VFA.Compliance status: Full Compliance

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

Company has performed identification of GHG emission sources of estate and mill activities.Company has calculated GHG emission of the SBYM, which includes calculation of respectiveGHG of estates supplying the fruit. Diesel fuel efficiency at SBYM in 2010 was 27.46%, 2011was 44.32%, and 2012 was 33.94%, so that on average the efficiency was 35.92%. Diesel fueluse in 2010 was 1.88 liter/ton CPO, in 2011 was 1.51 liter/ton CPO, in 2012 was 1.12 liter/tonCPO.SBYM use of palm shell and fiber as fuel substitutes in 2012 was 10,916,000 kg and 37,891,121kg, respectively, with the total energy used /ton CPO of 1,288,881 KKAL.GALA used diesel fuels in 2010 = 0.00068 Ltr/Ton FFBwith a total of 113,292,860 Ton FFB and76,982 Liter of Diesel fuels.2011 = 0.00073 Ltr/Ton FFB with a total of 134,171,830 Ton FFB and 97,589 Liter of Dieselfuels.



2012 = 0.00074 Ltr/Ton FFB with a total of 135,833,910 Ton FFB and 99,839 Liter Solar.2013 (until June) = 0.00114 Ltr/Ton FFB with a total of 35,473,620 Ton FFB and 40,272 Liter ofDiesel FuelsCompany has SOP on Calculation of Green House Gas Emission at SBYM of PT-SBYM/SOP/02The use of empty fruit bunches at SMRE in January – April 2013 was 21,763 ton with totalapplication land area of 382.89 hectares. Target area to be applied with empty bunches for 2years is 668 hectares. In 2012 it is 63,634 ton of empty bunches 1,155.74 hectares of land, withtarget of 672 hectares and 49,915 ton of empty bunches.Company has SOP on GHG Emission Mitigation of PT SIP – SBYM/SOP/22 No. Revision: 00,date approved: 02 January 2013, and performs calculations of GHG emission reduction fromdiesel fuel efficiency, shell efficiency in the process/mill where in 2012 the total GHG reductionfrom processing was 186.73 kg CO2/ton CPO. Compared with 2011 there is a rise due to theeffect of low crop and huge crop during harvest.There is no peat land at SBYE Estate, so that peat land management is not required.The Estate GHG calculation is as follows:SBYE = 74.75 kgCO2eq/Ton FFB; MSJA = 95.19 KgCO2eq/Ton FFB; GALA =81.77KgCO2eq/Ton FFB.SOP of GHG emission mitigation for PT SIP – SBYE/SOP/35 (SBYE), PT SIP – MSJA/SOP/35(MSJA), and PT SIP – GALA/SOP/35.Compliance status: Full Compliance5.5 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 otherregional best practice.

Company does not burn wastes and there are no replanting activities. Company already bansthe use of fire for replanting. Also, Company has instructed its workers and encouraged localpeople not to burn domestic garbage.Compliance status: Full Compliance

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

Management through RKL and RPL implementation.Organization has RKL and RPL covering environmental impacts on river and drilled well waterquality, ambient air, noise, air quality. RKL and RPL are reported to the BLH of Tulang Bawangand Mesuji Regency every 6 months starting from 2012, and there are receipts of RKP and RPLdocument submission.SOP of Waste Management, SOP/SPO/SMART/LH-09, revision: 00 date approved: 1 July 2010,covering mill wastes: solid, liquid, gas.SOP/WI is not yet available to handle stationary sources nuisance, such as noise that exceedsthe BMLAt the stage 1 the results of measurement of vibration, odor, and noise did not come out due tothe environmental testing laboratory’s equipment problems. Organization has followed up by



performing measurement on 20 May 2013 by the Government of South Sumatera Province,Environmental Body, UPTB Environmental Laboratory, covering odor at effluent ponds, noise atthe gensets and boilers, also emission at the gensets and boilers. The measurement results arenot departing from the requirements of the Regulation of the Minister of Environment No.21/2008 for Genset emission and No. 07/2007 for Boiler emission.Organization controls vibration, odor, and noise nuisance through job work instruction fornuisance in the Mill, such as noise disturbance, the work instruction of the genset job hasincorporated controls using silencer in the genset room and use of ear protection devices (earplug and ear muff).Relating to environment outside the perimeter of mill and in employee/population residential areathere is description on control in the RKL and RPL Report every six months, such as controlusing trees to repress odor, noise, and dust. The result of 20 May 2013 measurement does notdepart from the BML requirements (50 dBA at residential area, 70 dBA at mill surroundingenvironment).Organization needs to establish SOP/work instruction to deal with stationary sources impactingbeyond the mill (the location of stationary source disturbance is in the Mills. In the Estates, onlyGALA has gensets as stationary source nuisance which is potentially not yet meeting the BMLrequirements of the applicable regulations.Compliance status: Full Compliance6 RESPONSIBLE CONSIDERATION OF EMPLOYEES AND OF INDIVIDUALS AND

COMMUNITIES AFFECTED BY GROWERS AND MILLS

6.1 Aspects of estate and mill management that have social impacts are identifiedin a participatory way, and plans to mitigate the negative impacts and promotethe positive ones are made, implemented and monitored, to demonstratecontinuous improvement

Company has conducted Social Impact Assessment internally in 2012. Based on the results ofSIA it is identified that there are 14 villages around PT SIP affected by the social impact of estateand mill operations. SIA report says that the area of main estate is 9102.2 Ha and plasma estateis less than 15,000 Ha with total KUD member of 17,254 KKCompany has had the list of stakeholders of all units.Based on the results of SIA and input from the units, company has established a strategic planfor CSR Program of 2014-2018: period (5 years). The program has included the short-term andlong-term plans covering the aspects of education, health, infrastructure, sport, religion, arts,culture and micro business. The existing program does not include specific efforts made bycompany to preserve the native culture of indigenous people living around the companyenvironment.Based on the SIA report, Company has conducted road improvement activities in 2009-2011 for21 villages around the company site. Educational assistance is given to areas in the location ofmain estate and plasma estates. Religious assistance given in 2010 period already representsIslam and Christian religions and in 2013 it is for Hindu in the form of pura Talang Batu Villageconstruction.Based on the SIA report there is negative perception because of jealousy felt by villages fromnot receiving social assistance (Batu Ampar Village and Tri Rejomulyo Village). Companyresponded by launching Cheap Oil Market Operation in 2012 in Batu Ampar Village and



educational assistance in the form of building materials for the development of local primaryschool in SDN 01 Tri Rejomulya in 2013.Compliance status: Full Compliance

6.2 There are open and transparent methods for communication and consultationbetween growers and/or mills, local communities and other affected orinterested parties

Company has had SOP on Responding to Request and Information (SOP/SPO/SMART/LH-01).List of information is already available to be accessed by relevant stakeholders. Request forinformation outside the list will require the consideration and approval from the Topmanagement. List of stakeholders of each unit is already available consisting ofcustomary/community leaders, Muspida and village chief, company trade union, Contractors andsuppliers.Any incoming requests for information is recorded in KTU and passed to relevant Manager. Allrequests for information are recorded in information book. Each unit maintains informationrequest and response book. Routine requests are recorded in a routine information grantingbook and non-routine information requests are recorded in a separate book.In addition, Sinar Mas Group has SOP on Communication and Consultation(SMART/XIV/MCAR003) where any information requests will be responded the longest in 5weeks (1 month). Sampling an information request dated 19 May 2012 related to complaints onthe issues of road and village head incentive. The letter in question as well as the response tothe complaining party (Bp Ikhwanudin) from Sumber Jaya Village has been maintained.Compliance status: Full Compliance

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

Company has SOP on Complaint and grievances (SOP/NP/SMART/XII/MCAR001). Anycomplaint will be recorded in the log book of complaint and grievances. The source of complaintsmay be internally, externally and female workers. Sampling was conducted on employee’scomplaint on 10 December 2012 concerning poor quality of rice. Company passed the complaintto KUD as the supplier of the rice. The response from KUD dated 20 December 2012 states thatthey will supply better quality rice. The officer informed that the employee has received betterrice so that the complaint is closed.Compliance status: Full Compliance

6.4 Any negotiations concerning compensation for loss of legal or customaryrights are dealt with through a documented system that enables indigenouspeoples, local communities and other stake holders to express their viewsthrough their own representative institutions

There is SOP on Land Conflict Settlement (SOP/SPO/SMRT/LH-04). So far the company andKUD give information that there is no dispute in the period from 2010 until now in the company’ssurrounding areas. The SOP says to give first priority to deliberation for consensus over legalaction. Sampling conducted on the Mesuji stakeholders (Religious Leaders and District Chief)ensure that no conflict exists in the area of Sungai Buaya Mill.Compliance status: Full Compliance



6.5 Pay and conditions for employees and for employees of contractors alwaysmeet at least legal or industry minimum standards and are sufficient to providedecent living wages

Company maintains SKU Detailed Payroll (sample, May 2013), for SKU-H, SKU-B, as well asPKWT, while for BHL and BHB such list is contained in BHL Detailed Payroll (sample, May2013). For BHL the salary is paid twice per month, from 26th to 10th day of subsequent month,and from 11th to 25th of ongoing month, so the payroll is made twice.Company has company rules in the form: (1). Collective Labor Agreement between PT. SIP ofTulang Bawang Regency, Lampung: BH.NO: 182/PT.SIP/1989 and PUK.SPPP-SPSI TradeUnion of Tulang Bawang, with Registration No.: 063/KPTS/PC/SPPP.SPSI/TB/XII/2005, forperiod of 2011-2013, and (2). Company Regulations of PT. SMART Tbk, version 2013-2014.For 2013 payment system, company refers to the Decree of the Governor of Lampung NoG/30/III.05/HK/2013 concerning Stipulation on Tulang Bawang Regency Minimum Wage (UMK)in 2013 of Rp. 1,155,000.-, effective as per 01/01/2013. This provision has been socializedbased on SK No. 036/CEO 2/HR PSM 2/01/2013 concerning the Wage of Daily Labor (BHL) PT.SIP-Lampung. In consideration of the above Governor Decree then decide to adjust the wage ofdaily workers (BHL) to become Rp. 46,200/day. This decision comes into force from 01/01/2013.

At MSJA Unit, although located in the region of Mesuji Regency, the wage stipulation refers tothe same Governor Regulation to follow the Tulang Bawang UMK, i.e. Rp. 1,155,000.-. This isbecause in the Mesuji Regency (as expansion regency) there is no APINDO so as not tostipulate by itself. Company stipulates the same as that of SIP prevailing in Tulang BawangRegency.

With respect to the UMK (regency minimum wage) provisions the workers in the field have knowit precisely. This is known from the interviews with a number of BHB workers (taken by sampling)of harvesting personnel. They inform that daily wages are Rp. 46.200,- working fulltime for 25working days per month they will receive basic wages of Rp. 1.155.000,-,. On the wage paymentreceipt of June 2013, under the name of NIK: 09004/Suryaningsih (SKU-H status) from MSJAUnit it is written Rp. 1.172.500,- and on the payment receipt of NIK : 13007 /Toni Yanto a workerof GALA Unit (SKU-H status) the wages are written Rp. 1.155.000,-. The UMK provisions areimposed to the workers with BHL and PKWT status, and the first year SKU-H.

Company maintains company rules in the form of: (1). Collective Labor Agreement (PKB)between PT. SIP of Tulang Bawang Regency, Lampung: BH.No: 182/PT.SIP/1989 andPUK.SPPP-SPSI Trade Union of Tulang Bawang with Registration No.:063/KPTS/PC/SPPP.SPSI/TB/XII/2005, for 2011-2013 period, and (2). Company Regulation ofPT. SMART Tbk, version 2013-2014.

Company provides facilities and infrastructures to support and ensuring decent life. The followingis the List of Existing Welfare Facilities in PT. Sumber Indah Perkasa, SBYE Estate, GALAKKPA and MSJA KKPA per June 2013.

No. Type of Structures Unit Location Total

SBYE GALA MSJA

1. Staff Housing Unit 31 12 11 54



2. Employee Housing Unit 437 14 20 4713. Mosque Unit 4 1 1 64. Church Unit - - - -5. Kindergarten Unit 1 - - 16. Primary School Unit 1 - - 17. Smart House Unit 1 - - 18. Clinic Unit 1 - 1 29. Employee Rest House Unit 2 - - 210. Day Care Unit 4 - - 411. Cooperative Unit 2 - - 212. Soccer Field Unit 3 - - 313. Badminton Court Unit 4 2 1 714. Volley Court Unit 4 - 1 515. Tennis Court Unit 1 - - 116. School Children Transport Unit 1 1 - 2

The provisions on the rights to have housing facilities are regulated in PKB. It is also regulated ina circular issued by each Unit Manager. For example, Circulars concerning SKU Workers’Rights, issued by the Unit Manager of GALA No. Reff: 001/MSJA/01/201. It is stated that whenan employee is promoted to be SKU employee either Daily SKU (SKU-H) or Monthly SKU (SKU-B) he will be given his rights. Points 4, 7, and 8 say that they will have a housing facility withoutfurniture, but with free water and lighting. For staff employee, housing facility will be furnishedwith furniture as stipulated in Remuneration – Housing Facility document (no.doc: NOM F-017/02-00 approved by MD Strategic officials, valid from 01/05/2006. This provision applies toemployee of category H/G, F, D/E, to C/B.Company has entered into a contract with contractor that requires the contractors to comply withapplicable regulations on employment. Evidence can be seen in the contract or SPK (WorkingOrder) :1). SPK No. KUD-KS/GALA/SPKL-L/January-12-/010-FFB Transportation & Loading betweenGala Manager vs Nurohim (contractor), as follows :- Article 5 on Terms and Specification of Work, paragraph 4 the requirements to be furnished

with Vehicle Holder Book, Vehicle Registration Card, Inspection Certificate, and First Aid Kit.- Article 4, the requirements to include in worker’s insurance and pay the premium by the 2nd

party.- Article 5 paragraph 20, stressed that the contractor shall comply with the Department of

Manpower and Transmigration’s laws and regulations.- Article 7, concerning Work Accident, where the second party (Nurohim) shall pay the wage of

workers according to the UMK and include his workers in jamsostek program.

2). SPK No. 027/GALA/JKTO/04/2013 – Box Culvert dated 22/04/2013, between Director (TheBiao Leng, and Pedy Harianto) and Arifin (PT. Citra Kurnia Waway), contractor, i.e.:- Article 8 concerning liabilities in the case of Work Accident, the second party (contractor)

shall pay the worker compensation.- Article 4 concerning the mandatory Jamsostek registration



However, both SPKs do not expressly specify about work accident prevention, i.e. the use ofPPE. This is established as observation.

Compliance status: Full Compliance6.6 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 ofassociation and collective bargaining are restricted under law, the employerfacilitates parallel means of independent and free association and bargainingfor all such personnel

Company already has a Trade Union. The policy concerning permission to establish a tradeunion is contained in the Circular Letter from the CEO-2 concerning Trade Union Freedom, No.094/CEO2/SE/12/2010, dated 14/12/2010, that the freedom of association in a trade union is theworker or employee’s fundamental rights as regulated in Act No. 21/2000 on Trade Union orLabor Union.

The existing trade unions are only one and covering all Units both Estates and Mills. The unionhas been registered as in the Decree of Branch Board of Agricultural and Plantation Trade UnionFederation of SPSI of Tulang Bawang Regency No. 026/Kpts/PC/SP.PP-SPSI/TB/VI/2007,dated 5/06/2007 concerning Endorsement of Work Unit Leaderships of SP.PP SPSI PT. SIP for2007-2012 service period and has a Collective Labor Agreement (PKB) book with a registrationnumber according to the Decree of the Head of Department of Manpower of Lampung ProvinceNo. KEP.188.4/4811/III.05/03/I/2011. The applicable PKB is that of 2011-2013 periods.

The Trade Union Leadership terms are now extended in accordance with SK No.100/Kpts/PC/SP.PP-SPSI/TB/VI/2012 concerning Stipulation on Work Unit Executive Board ofSP.PP-SPSI PT SIP, dated 11/06/2012, in the third dictum: “to give a full mandate to PLT PUKSPSI PT SIP to organize the work unit meeting (Musnik)in November 2013. The second dictum:to endorse executive boards of PUKSPSI PT SIP (there are 6 workers being endorsed).

Currently the total number of PT SIP Trade Union members, data of May 2013, is 1,102 people.This membership is automatic in nature, when one becomes a worker of minimum SKU-Hstatus. Currently, the member card as proof of membership is not produced yet. The names ofmembers are registered in the List of Trade Union Member of respective work unit.

Bipartite Cooperation Body (LKS) has also been established in each Unit and is alreadyapproved by local Department of Manpower. For example, the LKS of PT. SIP (MSJA), 2013-2015 Period, No.: KEP 560/24/III.04/MSJ/LKS-BP/V/2013 dated 8/05/2013 by Head ofDepartment of Manpower and Transmigration of Mesuji Regency. The membership is composedof 11 company representatives to 10 worker representatives.

Company provides facilities to smooth Trade Union activities, in the form:- A room for Trade Union office- Desks, chairs, stationery,- File cabinet- A meeting table and chairs- Water dispenser- Uniforms clothing for the trade union board members totaling 16 pieces.- A freedom to use office administration facility.



- Fostering the treasury by KTU relating to bookkeeping

Records of meeting both internal and external, as sample some can be reported as follows:- Minutes of SPSI meeting with the Management of PT SIP Lampung dated 31/01/2013, with

subject “Discussion on workers’ aspiration and request”, attended by 17 workers at TT by PUKSPSI-Sopuan, EM Gala, and HRD Jakarta.

- Letter of Acknowledgement of PT. SIP Gala LKS Bipartite meeting, dated 23/02/2103, todiscuss the payment of back pays based on Lampung Governor Decree.

- Letter of Acknowledgement of PT. SIP MSJA LKS Bipartite meeting, dated 13/4/2013, todiscuss the payment of back pay of harvesting personnel that should refer to Circular Letter ofDept. Agro. No. PSM II/SE/187/III/2013, effective date 1/01/2013.

- Minutes of PT SIP Gala Bipartite meeting, dated 15/4/2013, discussion on harvestingpersonnel wages 2013 and fines of production foreman.

Compliance status: Full Compliance6.7 Children are not employed or exploited. Work by children is acceptable on

family farms, under adult supervision, and when not interfering with educationprograms. Children are not exposed to hazardous working conditions

Company is very stringent in selecting the candidate employee in order to prevent under ageworkers, the minimum should be 18 years old. This provision is regulated in:- PKB article 7 concerning new employee recruitment, paragraph 4, at the minimum 18 years

old.- Government Regulation Chapter II Work Relations, Article 5, paragraph 2 that candidate

worker should be the minimum 18 years old.- Circular Letter from HR Director to all Unit Head, No. 002/SE-HRDV/03/09, date 31/3/2009

with subject: Minimum Age Limitation, swehubu. Act No. 13, article 68, concerning childemployment prohibition, so the minimum age of employee recruitment is 18 years old.

The evidence of implementation of this policy can be seen in the following data:- In the Summary Data of GALA SKU Employee, the youngest work entry age is 18.31 years

old, under the name of Burhan Hidayat, born 4/2/1993, entry into work on 20/7/2011,- In the Summary Data of MSJA SKU Employee, the youngest work entry age is 20 years old,

under the name of Eli Nurwanto, born 26/03/1986, entry into work on 01/10/2006.Compliance status: Full Compliance

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

Company gives equal opportunities to everyone to work in Company. The documents: (1). HRPolicy No. A-001-00, effective 1/9/2005, issued by Managing Director Strategic, point 2, statesthat in principles Organization employs competent individuals in accordance with positionrequirements without discrimination by ethnic, race, and religion”. (2). Employment RecruitmentPolicy: Provision on Recruitment and Selection Outside Jakarta (no. SDM A-006-00, dated1/9/2005), regulates that recruitment of manpower does not define particular ethnic, sex, as wellas religion as requirements. It is also mention minimum age of 18 years old.”As evidence, worker composition in each Unit can be seen in the data as per May 2013, fromdata sampling as follows:



Data of GALA Estate BHL:- Sex: Male 364, Female 2.- Religion: Islam 365, Christian 1- Ethnic: Javanese 360, Ogan 1, Lampung 4, and Sundanese 1.Data of MSJA Estate SKU:- Sex: Male 51, Female 2- Religion: Islam 50, Christian 2, and Hindu 1.- Ethnic: Javanese 49, Palembang 2, Bali 1, and Sundanese 1.As evidence, worker composition in each Unit can be seen in the data as per May 2013, fromdata sampling as follows:- Data of BHL, GABA Estate- Sex: Male 269, Female 114.- Religion: Islam 378, Hindu 4, Christian 1- Ethnic: Javanese 375, Palembang 1, Balinese 4, and Sundanese 1.- Data of BHB, GABA Estate:- Sex: Male 16, Female 276- Religion: Islam 291, and Hindu 117. Ethnic: Javanese 286, Palembang 2, Lampung 1, Balinese 1, and Sundanese 2.The plantation and mill is located in the transmigration area where the majority of transmigrant isJavanese and Moslem.Job vacation format also does not mention sex, ethnic, or religion for job in general—that can beworked on by men or women.For example, in GALA Unit, Job Vacation for Office Administration (Agronomical Clerk), dated26/8/2012, the listed requirements: male/female, and over 18 years old.Compliance status: Full Compliance

6.9 A policy to prevent sexual harassment and other forms of violence againstwomen and to protect the reproductive rights is developed and applied

Company has established a policy related to prevention of sexual harassment in a circular letterSocialization on Harassment Sexual Issues, No. 003/CEO2-SE/01/2011, dated 10/01/2011.There should be socialization to all employees concerning prevention and handling of sexualharassment issues, so as to increase legal awareness and respect norms and ethics in theplantation work units of Sinar Mas II.Samples of evidence of the implementation of prevention of sexual harassment activities ofsocialization in GALA and MSJA Units are as follows:- GALA Unit, there is the Letter of Acknowledgement of Socialization on Sexual Harassment

carried out on 15/06/2013, to 25 K3T representatives, and on 13/7/2013, to 29 staff’s wife’sand male workers.

- MSJA Unit, there is the Letter of Acknowledgement of Socialization on How to Deal With



Sexual Harassment held on 14/03/2013, there are 13 participants for the staff’s wife’s andmale workers.

Nevertheless, in GALA Unit, this socialization has been made only to 23 representative of K3Tpersonnel and 29 staff’s wives and male workers. There is no evidence that it is made to 366PKWT workers and 486 BHL personnel. In MSJA Unit, there is no evidence that socializationhas been made to BHL/BHB workers, only to 13 staff’s wives and male workers. This isestablished as minor nonconformity.

Company policy on protection of reproductive rights and documented has been included in:- Government Regulation chapter IV, article 23 concerning Annual Leave, Article24 Long Rest

Period, Article 25 Maternity or Miscarriage.- Memorandum No. 001/Memo/VPA PSM2/04/2011 dated 8/4/2011, concerning prohibition of

pregnant and breast feeding workers to work as sprayers.- Circular Letter No. 095/CEO2-SE/12/2010, dated 14/12/2010, concerning Menstrual Period

Permit Granting, where working is not permitted in the first and second day.

Record evidence of the policy implementation of reproductive rights protection is:- Sick Leave Certificate under the name of Wiji Astuti, 31 years old, (GALA Unit), No.

0012/PKM-GRS/EX/SKS/VI/2013, H2 (pregnant) leave and there is filled in Employee LeaveApplication Form from 4/7/2013 to 1/10/2013 (90 days), signed by Manager.

Company has had a policy relating to employee grievances, i.e.: (1). PKB Article 26 GrievanceSettlement, and (2). SOP on Grievance and Dissatisfaction Handling (No.SOP/NP/SMART/XII/MCAR/001, issued date 1/7/2010).

Records of worker complaints and grievance are kept and followed up. Each Unit maintains a logbook to record worker’s grievance. For example, in GALA as well as MSJA Unit there is aGrievance Log Book that specifies information : Date, Place, Name, Contact details, Issue (s),Registration, Response (Date, Action, Current status, PIC), and Target Finish. If a worker wantsto convey his grievance, he should write a letter, may or may not be official, addressed to themanagement. Furthermore, the management will read, record, and follow up. From sampling ofsome of recorded grievances, the management has sought to follow up. Grievance status will bewritten “Close” when finished.Compliance status: Minor no. 1 Non-conformity6.10 Growers and mills deal fairly and transparently with smallholders and other

local businesses.For Mesuji, there has been a letter of FFB price stipulation from local Plantation Department ofLampung Province on 7 May 2013 stating that on average the FFB price is Rp. 1,136.27/Kg andthe price company sets to the KUD Krida Sejahtera is Rp. 1,243.00 based on the planting year>10 year and higher.For July, Lampung Province sets Rp. 1,320.61/kg as the price for the crops of 10-20 years old.There is SOP for FFB Grading Guidelines and FFB Grading WI No PT SIP-SBYM/IK/04-1. Itcontains sorting criteria and penalty provisions for FFB out-of-specification. Company hasestablished the grading system and penalty provisions and has conformed to the provisionsstipulated by the Government. Based on the grading system, unripe and less ripe fruits and overripe fruits will be subject to penalty 50%, empty fruit bunches 100%. The grading outcome andthe percent of fruit subjected to penalty are sent to the KUD in the form of hardcopy and softcopyso that the KUD’s data is updated daily.



Sampling of sorting outcome per January 2013 results in 9,446,020 Kg FFB and 13,202 kgpenalty from over ripe fruits (50% penalty) and empty fruit bunches (100% penalty). The gradingdetermination has conformed to the provisions of the regulation of the Minister of Agriculture No.395/Kpts/OT.140/11/2005The setting up of FFB purchasing price follows the prevailing provisions, and the summary ofFFB price stipulation from authorized agency is available. Payment has been settled in a timelymanner both to cooperatives and contractors.Company should ensure the cooperative’s efforts to communicate pricing methods and pricecutting related to costs imposed to plasma members for maintenance and transportation. This isto ensure that all parties understand the contract agreement they entered into, and that thecontracts are fair, legal and transparent.Compliance status: Observation no. 116.11 Growers and millers contribute to local sustainable development wherever

appropriate

Company has in place a policy in the form of company memorandum to perform CSR programthroughout the company group in order to comply with Act of RI No. 40/2007. CSR plan in 2013covers the aspects of education (scholarships), health (hospital rehabilitation, posyanduactivities, fogging, mass medication), economic empowerment (FFB transportation by localcontractors, purchasing local materials), infrastructure (road improvement, surfacing) and socialassistance for religious purpose and celebration of day of an important event.Company has a program of prioritizing local contractors to have jobs. Jobs given include printingmaterials for administration purposes and rice procurement by KUD, FFB transportation,harvesting ladder construction. Samples taken are SPK 001-GABA/SPK-L/I/2013- FFBTransport. The SPK has a validity period and terms of payment which is twice a month under thename of Bp. Suradi, May 2013 period.Compliance status: Full Compliance

7 RESPONSIBLE DEVELOPMENT OF NEW PLANTINGS

7.1 A comprehensive and participatory independent social and environmentalimpact assessment is undertaken prior to establing new plantings oroperations, or expanding existing ones, and the results incorporated intoplanning, management, and operations

Not Applicable8 COMMITMENT TO CONTINUOUS IMPROVEMENT IN KEY AREAS OF ACTIVITY

8.1 Growers and millers regularly monitor and review their activities and developand implement action plans that allow demonstrable continuous improvementin key operations

Company has conducted evaluation regularly to ensure ‘continuous improvement’ through themechanism of regular management meeting and internal audit activities. SOP no.SOP/SPO/SMART/LH-16 lists audit internal which is conducted at least once a year. In addition,the management conducts routine meetings both regionally and corporately.Company has conducted internal audit with different objects, such as called Mill Audit Advisorywhich is performed twice a year. For ISPO/RSPO, Internal Audit is scheduled at least once a



year. ISPO/RSPO internal audit was carried out by personnel who have had Internal Auditortraining, i.e. Maman Surahman, Baby F Nurainy and Hendra Setiawan on 19-26 March 2013.There were 13 findings and all have been closed.Company has developed CSR program for respective units and for the communities in theneighborhood of plasma and main estates. Some of the short-term programs have beenimplemented for the period of 2013.Company should develop a specific method to evaluate the effectiveness of CSR programs doneas input to future program improvement.Compliance status: Observation No. 10



D.Certified Organization’s Acknowledgement of InternalResponsibility

D.1. Formal Sign-Off of the Assessment Findings

I the undersigned, being the legal representative of the inspected company, agree with thecontents of this report and accept the liability in execution of the instructions given in the report.

Name Ismu Zulfikar

Position Head of Environment and CSR Coordination

Signature

Date



D.2. Statement by the Certifier Body on Behalf of PT. Sucofindo SBU-SICS

We, the undersigned declare that the information and conclusions included in this report have

been prepared in accordance with rule and standard of RSPO, P&C, and that the certification

decision has been based upon this information.

Verified and Reviewed by:

Name Nuzwardy Sjahwil

Position SLA / LA / Auditor

Signature

Date December, 16th 2013

Approval:

Name Triyan Aidilfitri

Position HSE Audit and Certification Department Head

Signature

Date December, 16th 2013



List of Abbreviation

AMDAL Analisa Mengenai Dampak Lingkungan (Environment Impact StudyReport)

ANDAL Analisa Dampak Lingkungan (Environment Impact Analysis Report)BOD Biological Oxygen DemandBPN Badan Pertanahan Nasional (National Land Agency)COD Chemical Oxygen DemandCPO Crude Palm OilCSR Corporate Social ResponsibilityDOE Department of EnvironmentEFB Empty Fruit BunchEIA Environment Impact AssessmentFFA Free Fatty Acid(s)FFB Fresh Fruit BunchFSMS Food Safety Management SystemGMP Good Manufacturing PracticeGABA Gedung Aji Baru EstateGALA Gedung Aji Lama EstateGPS Global Positioning SystemHa Hectare(s)HACCP Hazard Analysis and Critical Control PointHCV High Conservation ValueHCVF High Conservation Value ForestHGU Hak Guna Usaha (Land Use Title)HSE Health Safety EnvironmentIEMA Institute of Environmental Management and AssessmentIPB Institut Pertanian BogorIRCA International Register of Certified AuditorJAMSOSTEK Jaminan Sosial Tenaga Kerja (Labor Social Insurance)K3 Keselamatan dan Kesehatan Kerja (Occupational Safety and Health)KAN Komite Akreditasi Nasional (The Indonesian Accreditation

Committee)KKPA Kredit Kepada Koperasi PrimerKLH Kementerian Lingkungan Hidup (Ministry of Environment)KTU Kepala Tata Usaha (Administration Head)LCC Legume Cover CropLSM Lembaga Swadaya Masyarakat (NGO(s))MOU Memorandum of UnderstandingMSDS Material Safety Data SheetMSJA Mesuji EstateNA Not ApplicableNC Non ConformityNCR Non Conformity RegisterOER Oil Extraction RateOSH Occupational Safety and Health



OSHAS Occupational Safety and Health Assessment SchemeP&C Principle and CriteriaPHT Pengendalian Hama Terpadu ( Integrated Pest Management/IPM)PK Palm KernelPKO Palm Kernel OilPOM Palm Oil MillPOME Palm Oil Mill EffluentPPE Personal Protective EquipmentRSPO Roundtable on Sustainable Palm OilRSPO NI Roundtable on Sustainable Palm Oil National InterpretationRKL-RPL Rencana Kelola Lingkungan dan Rencana Pemantauan Lingkungan

(Environment Management Plan – Environment Monitoring Plan)SA8000 Social Accountability 8000SIA Social Impact AssessmentSIO Surat Izin OperatorSOP Standard Operating ProcedureSIP Sumber Indah PerkasaSBYM Sungai Buaya MillSBYE Sungai Buaya EstateSMK3 Sistem Manajemen – Keselamatan dan Kesehatan Kerja

(Management System of Occupational Safety and Health)SMRM Sungai Merah MillSMRE Sungai Merah EstateTTD Tim Tanggap Darurat (Emergency Response and Preparedness)UKL Upaya Pengelolaan Lingkungan (Environmental Management

Efforts)UPL Upaya Pemantauan Lingkungan (Environmental Monitoring Efforts)WWTP Waste Water Treatment PlantWHO World Health Organization



ATTACHMENT-1

MAP



1.1. Overlay Map of Sungai Buaya Estate, Gedung Aji Lama Estate and MesujiEstate



1.2. Map of Rivers



1.3. Map of HCV Sungai Buaya Estate



1.4. Map of HCV Gedung Aji Lama Estate



1.5. Map of HCV Mesuji Estate



1.6. Map of Topography



1.7. Map of Planting Year Sungai Buaya Estate



1.8. Map of Planting Year Gedung Aji Lama Estate



1.9. Map of Planting Year Gedung Aji Lama Estate



ATTACGMENT - 2

NCR



Non Conformity / Observation ReportOrganizationNo.

AuditNo. Standard. Audit Date :

14-06-2013 (TSS, RQ,WS, AMR, )

RSPO 00003 1 (1) RSPO (Preliminary) ATL / Auditor :

Organization Rep. :

No. Category Clause Std Auditor Description

Root CauseInvestigation*

Corrective Action &Evidence*

AuditTeam

Review(1) (2) (3) (4) (5) (6) (7) (8) (9)

1 Major 2.1 1 TSS The company has aletter of permit of therelease of forestedareas and or a letter ofdesignation with theAPL status for theplantation area of PTSumber Indah Perkasa.The company does nothave permits/IUP for Millwith a capacity of 120tons of TBS/hour. So farthe company only has aletter ofrecommendation fromthe Provincial Servicefor the management ofmills with a capacity of120 tons TBS/hour.

1. Letter of theRegional ForestryOffice of LampungProvince No.1052/KANWIL-6/TGH-134/90 isundocumented inthe estate office sothat at the time ofpre audit it couldnot be shown tothe auditor

2. The IUP does notspecify a mill with acapacity of 120tons/hour, but withrespect toproductioncapacity, there hasbeen an approvalfrom the StateMinister of

Corrective Action 1:Document the letter ofthe Regional ForestryOffice of LampungProvince No.1052/KANWIL-6/TGH-134/90 at the estateoffice.Evidence 1:Letterof the Regional ForestryOffice of LampungProvince No.1052/KANWIL-6/TGH-134/90 has beenavailable.CorrectiveAction 2:Confirmation tothe relevant agenciesrelating to IUP.Evidence2:The company has hadSPUP that is valid asIUP, while for productioncapacity there has beenan approval from the

Closed



Investment / Headof BKPM.

State Minister ofInvestment / Head ofBKPM No46/II/PMDN/1998 dated01 July 1998 concerningLetter of approval forexpanding domesticcapital investment statingthat the productioncapacity becomes 120Tons of FFB per hour.This was confirmed bythe letter of the Head ofCapital InvestmentCoordinating Board andIntegrated Permit Serviceof Lampung Province No800/200/BID.V/II.06/2013 dated 01July 2013 that theBusiness Permit of PTSIP issued by BKPM /Agency for capitalinvestment is equal to theestate business license(IUP) issued by sectoraltechnical agency due tothe authority granted bythe Minister ofAgriculture.

2 Major 4.6 ;5.3

1 RQ At GABA, waste watercomes from bathingactivity of sprayerpersonnel flows intothe septic tanks, but at

Waste water comefrom bathing activity ofsprayer personnel atthe SBYE does notenter into the septic

Corrective Action :To repair the bathroom'ssewer so that usedwater from the sprayerbathing activities will not

Closed



SBYE it flows to publicditches. This ispotentially tocontaminate water thatwill poison flora, fauna,and human.

tanks or a catchmentand still flows intopublic ditches.

go to public ditches.

Evidence:Used water from thesprayer personnelbathing activities hasbeen directed to theseptic tanks (Photodocumentation isavailable).

3 Major 5.6 1 RQThe measurementresults for vibration,odor, and noise are notobtained because thereis a problem with theenvironmental testinglaboratory's equipment.

Vibration and odortests have been carriedout but the results arenot obtained yet.

CorrectiveAction:Perform vibrationand odor tests incollaboration with anaccreditedlaboratory.Evidence:Theresults of vibration andodor tests have beenavailable.

Closed

4 Major 5.4 1 RQ The company does nothave a record of landuse trajectory fromsecondary forest intopalm land.The company does nothave a record of landuse a minimum 2 yearsbefore the land iscleared for plantationbusiness.The company does nothave a record of landuse trajectory fromsecondary forest into

Document of land usetrajectory cannot beshown because theprior status of land isAPL

Corrective Action:Document of land useplan prior to theplantation opening willbe searched for.

Evidence:The document isavailable in the form ofland satellite image1988 – 1989.

Closed



palm land.The company does nothave a record of landuse a minimum 2 yearsbefore the land iscleared for plantationbusiness.

5 Major 4.1 1 WS The SOP on SeedNursery(SOP/SMART/MCAR/III/TA-BBT, rev.00,1/9/2012) andIK/SMART/MCAR/III/TA-BBT/06 on SeedlingAcceptance andPlanting does not yetexplicitly regulate the"obligation to use acertified seed".

SOP does not includesentences requiring theuse of certified seeds.

Corrective Action:Develop a mechanismthat requires the use ofcertified seeds.

Evidence:The mechanism to usecertified seeds has beenavailable in the form ofSE from VPA PSM2.

Closed

6 Major 4.1 1 WS There is no SOP/WorkInstruction thatexplicitly and in detailsregulates planting onpeat land

SOP of planting onpeat land is unable tobe shown because thecompany hascommitted not to makea new planting in peatland area.

Corrective Action:Develop a SOP thatregulates planting inpeat land replantingarea.

Evidence:There has been a SOPregulating on planting inpeat land replantingarea.

Closed

7 Major 4.7 1 WS The company, forSBYM and SMRMMills, currently doesnot have fire mitigationofficers as regulated in

Fire warden training isnot already conductedat SBYM and SMRMunits.

Corrective Action :Deliver fire mitigationtraining to fire warden incollaboration withrelevant

Closed



Kepmenaker No.186/MEN/1999.

agencies.Evidence :Firewarden training hasbeen conducted byLocal Manpower andTransmigration Service& Disaster MitigationBody of Tulang BawangRegency on 5 July 2013

8 Major 4.7 1 WS There are someofficers of fire fightersquad in theEmergency ResponseTeam Structure withoutevidenced of firemitigation training.They are: SBYE, 1people, SMRM 5 out of7 people, and SMRE 5out of 8 people.

At the implementationof fire mitigationtraining, some of theemergency responseteam's members werenot present so that notall the people have firemitigation training.

Corrective Action:Conduct training inusing Apar for firefighter squad that hasregistered in thestructure of emergencyresponse team.

Evidence:Officers of fire fightersquad registered in theemergency responseteam have received firemitigation training.

Closed

9 Major 4.7 1 WS Simulation on dealingwith fire emergencysituation has not beencarried out in SBYEand GABA units.

Fire simulation has notconducted in eachwork unit of estate andmill, because to datefire simulation iscarried out jointly(Estate and Mill) atSBYE.

Corrective Action:Conduct fire emergencyresponse simulation.

Evidence:Documentation of thesimulationimplementation hasbeen available.

Closed

10 Major 4.7 1 WS Data of worker healthshowed that there is noexamination ofcholinesterase aspect

Periodic healthexamination has beenconducted routinely,but the examination of

Corrective Action:Conduct Cholinesteraseexamination forchemical warehouse

Closed



on workers touchingB3, such as: sprayersand chemicalwarehouse officers.

Cholinesterase has notbeen conducted yet onthe sprayer personneland chemicalwarehouse officers.

officers and sprayerpersonnel.

Evidence:Chemical warehouseofficers and sprayerpersonnel have theircholinesteraseexamined (The testresults from ProdiaLaboratory have beenavailable).

11 Major 4.7 1 WS During a visit to Millarea, some workerswere found not usingPPE, sampling: (1) atSMRM, in the area ofSt. Sterilizer, and Nut-Kernel, not usingearplug/muff. (2). Noapron was available forworkers in boiler area.

Noise test value at St.Sterilizer and NutKernel is 84 - 85 dBA..

Corrective Action: Riskanalysis has beenreviewed based onsuggestion from theAuditor by providing earplug/muff in STSterilizer and NutKernel.Evidence:Minutes of ear plug /ear muff supply /acceptance have beenavailable.

Closed

12 Minor 6.9.1 1 WS There is no evidencethat sexual harassmentsocialization has beenconducted in MSJAunit. In addition fromthe evidence ofsocialization recordsavailable is stillextremely small innumber.

Sexual harassmentsocialization in MSJAhas been conducted tothe staff's wives andsome female workersbut the documentationis kept in the MSJASPO secretariat so thatit was unable to beshown duringdocument checking by

Corrective Action:Document the evidenceof sexual harassmentsocialization.

Evidence:Evidence of sexualharassmentsocialization is availableand documented.

NotClosed(ThisNCRwill beseen incertificationaudit)



auditor in the LampungRegional office.

13 Observation

6.1 1 TSS It would be better thatCSR plans developedare capable of ensuringwelfare/skillimprovement. Themethod of needidentification isemployed as a basis todetermine priorities ofthe CSR program invillages outside thecompany area.It is suggested thecompany establishes ashort- and long-termplan and a method ofevaluation to ensurethat the CSR programis effective andsuccessful as anindicator ofimprovement.

The short-term CSRplan has beenavailable in the form ofAnnual CSR Program.The Five Year CSRStrategic Plan of 2014– 2018 periods alongwith the performanceindicator for evaluatingCSR activities areunder preparationprocess.

Corrective Action:Finalize 5 year CSRstrategic plans.

Evidence:The draft CSR strategicplan of 2014 – 2018period along withperformance indicatorfor evaluating CSRactivities has beenavailable.

Closed



Non Conformity / Observation ReportOrganizationNo. Audit Standard. Audit Date :

19-07-2013 (TSS, RQ, GGU, YSF,WS, )

RSPO 00003 No. 02 (1) RSPO (Certification) ATL / Auditor :RSPO 0004

Organization Rep. :

No. Category Clause Std Auditor DescriptionRoot Cause

Investigation*Corrective Action &

Evidence*

AuditTeam

Review(1) (2) (3) (4) (5) (6) (7) (8) (9)

1 Minor 6.9 1 WS The implementation ofsexual harassmentsocialization to employees islimited compared to thenumber of workers. Datashowed :-In GALA Unit, the numberof workers has beensocialized to 23 safety teamand 29 staff’s wives andmale workers. For BHL andPKWT personnel are63 outof 872 workers (only 7.2 %).-In MSJA Unit, no evidenceis found that the socializationhas been made to BHL/BHBworkers; it is only to 13staff’s wives and femaleworkers.

Sexual harassmentsocialization has beenconducted to the workers,but the documentationwas cannot be showed atthe time of audit.

To completed thedocumentation of sexualharassment socialization.Evidence :Documentation of sexualharassment socialization isavailable at SPOsecretariat.

Closed



2 Obs 4.6 1 YSF Company has usedherbicide registered inPesticide Commission of theRepublic of Indonesia butthe use of restrictedpesticide should be reducedgradually and substituted bya more environmentallyfriendly herbicide and saferto field operators.

The company still applyrestricted pesticide i.e.paraquat.

The management hasissued memo to reducethe paraquat No.002/MEMO-VPAPSM2/04/2011. Therestricted pesticide will bemonitored yearly to seethe trend of paraquatreduced.Evidence :Graphic of restrictedpesticide use year 2011-2013 showed the reduceof paraquat used.

Closed

3 Obs 4.7 1 YSF Two units of Light FireExtinguisher in diesel fuelwarehouse and KKPA GALAwarehouse should beinspected more carefully toensure the content andpressure of the extinguisherso that they can be usedduring the emergency.

The personnel checkedthe fire extinguisherinaccurately.

The Head of P2K3retraining the personalwho responsible to checkthe fire extinguisher. Toensure the monitore resultof fire extinguisher meetwith the actual condition.Evidence :Letter of reminder fromHead of P2K3 to secretarywith the subject of the fireextinguisher monitoringsystem.

Closed

4 Obs 4.7 1 YSF Company has undertakenworkers health examinationcovering cholinesterase andaudiometry but for thoseworking with risks ofchemical exposure shouldbe added with spirometryexamination to ensure theirlung health.

The workers withexposure to chemicalmaterial hazard were notchecked for spirometry.

To conduct identificationthe workers with risks ofchemical exposure andgradually will conductspirometry checking.Evidence :1. List of worker who

needs to be checkedfor spirometry.

2. Medical check programfor spirometry.

Closed



5 Obs 2.3 1 TSS/GGU

Organization has made amap but the map shouldhave a sufficient scale, atleast 1 : 100.000 inaccordance with Decree ofthe Ministry of Forestry No.48/menhut-II/2004.

The company has thedifferent scale for allmaps.

Map will be adjusted to bescale 1 : 100.000Evidence :Map with the scale1:100.000

Closed

6 Obs 5.2 1 TSS/GGU

Organization had SOP onHCV Management, itspecifies that monitoring orpatrol is carried out everytwo weeks but in GALA thelast monitoring is on 24 June2013.

KKPA GALA Estate hasno data for monitoringHCV for July 2013.

HCV monitoring and patrolwill be conducted every 2weeks.Evidence :HCV Monitoring and patrolis available.

Closed

7 Obs 5.2 1 TSS/GGU

Organization has performedmonitoring and contained inHCV Monitoring Report, butit should establish Person inCharge (PIC) and due dateof the recommendationspecified in the HCVmonitoring report to see thefollow up and progress ofsuch recommendation.

There is no column forPIC and Action Plan atForm HCV Monitoring.

Completed the form withedit PIC and Action Plan.Column.Evidence :Revision of Form HCVMonitoring.

Closed

8 Obs 4.7 1 WS Company already completewith the provisions of Decreeof the Ministry of ManpowerNo. 186/1999 related to thenumber of fire mitigationpersonnel in mill area. But itonly trained 20 personnel forboth mills (it should be 12personnel for each mill). Itshould ensure to graduallyconduct training to cover theremainder in class D, C, Band A.

The simulation of firefighting has conductedbut the number of the firefighter was not meet withthe governmentregulation (KepmenakerNo. 186 Tahun 1999).

To fulfill the number of firefighter to meet with theKepmenaker No. 186Tahun 1999.Evidence :Documentation of firefighter training.

Closed



9 Obs 4.8 1 WS In GALA, two SPKs arefound not expresivvelyspecifying the provisions ofPPE mandatory use. Theyare SPK No.027/GALA/JKTO/04/2013 –Box Culvert, and SPK No.KUD-KS/GALA/SPKL-L/January-12-/010-FFBTransportation &Loading.

During tender process,the requirement of safetyaspect has been informedto the contractor, butwhen the MoU issuedthere is no safetyrequirement stated.

In every MoU, the safetystandard should be statedmandatory.Evidence :The revision of MoU.

Closed

10 Obs 8.1 1 TSS Companyshould develop aspecific method to evaluatethe effectiveness of CSRprogram done as input tofuture programimprovement.

Yearly CSR Program hasbeen setup for each unit,but not yet covered theculture program. For thestrategic planning year2014-2018 hasaddressed the vision andmission to develop andmaintain the culture oflocal people.

The company will re-identification the existingindigenous people. If thereis then the company willsetup the CSR to developand maintain the culture ofindigenous people.Evidence :Revise CSR Program.

Closed

11 Obs 6.10 1 TSS Company should ensurecooperative’s efforts tosocialize aspects thatbecome a factor in pricecutting related to costsimposed to plasma membersfor maintenance andtransportation costs. Proofthat all parties understandthe contract agreement theyentered to, and that thecontracts are fair, legal andtransparent.

The company hasconducted thesocialization to thecooperation staff andcoordinator staff,regarding the factor inprice cutting related tocosts imposed to plasmamembers formaintenance andtransportation costs. Butthe socialization was notsufficient some of themembers were found wellnot understand for thesubject.

The company will conductmonthly meeting and tosocialized the factor inprice cutting related tocosts imposed to plasmamembers for maintenanceand transportation costs.Evidence :The documentation ofmeeting schedule betweencompany and cooperationis available.

Closed



APPENDIX

PT. SUMBER INDAH PERKASA – SUNGAI BUAYA MILLRSPO SUPPLY CHAIN CHECKLIST – MASS BALANCE MODUL

PT. Sumber Indah Perkasa – Sungai Buaya Mill (SBYM) is implemented the supply chainsystem procedures as required in RSPO certification. The company has set the supplychain system categorized as Mass Balance scheme.

A. Documented Procedures1.1 Complete and up to date procedures covering the implementation of all the elements in these

requirements.

Records/Evidence:There is procedure SOP Identifikasi dan kemampuan-telusuran (SOPIdentification and Traceability) PT SIP‐SBYM/SOP/01, issued : 02/01/2012The name of the person having overall responsibility for and authority over the implementationof these requirements and compliance with all applicable requirements. This person shall beable to demonstrate awareness of the facilities procedures for the implementation of thisstandard.

Records/Evidence:Management Representative related to RSPO-SCCS implementationTraceability Officer related to RSPO‐SCCS implementationSBYM: Decree No. 006/PC‐SBYM/III/2013

Document Controller – SPO Officer related to RSPO‐SCCS implementationSBYM: Decree No. 003/FM‐SBYM/III/2013

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

Records/Evidence: SOP Identifikasi dan kemampuan-telusuran (SOP Identification and

Traceability) PT SIP‐SBYM/SOP/01, issued : 02/01/2012 Surat Pengantar Buah (Fruit Delivery Letter) (SBYE, GALA & MSJA) with

‘’Mass Balance’’ mark SBYM: Form Rekap Penerimaan TBS Per Unit (FFBReceiving Resume Form each Unit)

CPO Production ReportSBYM = 66,926.180 Ton/Year (with average OER : 22.08)Recapitulation data of FFB certified received/process & CPO production fromJanuary to December 2012

PK Production ReportSBYM = 16,420.640 Ton/Year (with average KER : 5.42)Recapitulation data of FFB certified received/process & PK production fromJanuary to December 2012

CPO Dispatch ReportSBYM= 65,285.310 Ton/Year

PK Dispatch Report



SBYM= 16,056.510 Ton/YearB. Purchasing and goods in

2.1 The facility shall verify and the document the volumes of certified and non-certified FFBsreceived.

Records/Evidence: There is procedure SOP Identifikasi dan kemampuan-telusuran (SOP

Identification and Traceability) PT SIP‐SBYM/SOP/01, issued : 02/01/2012 There is a database system called Weightbridge Computerized Program which has

been designed to separate certified and non-certified incoming FFB from own estate,Scheme small holders and independent small holders with the specific code indatabase.

2.2 The facility shall inform the CB immediately if there is a projected overproduction.Records/Evidence:

SOP Identifikasi dan kemampuan-telusuran (SOP Identification andTraceability) PT SIP‐SBYM/SOP/01, issued : 02/01/2012 has been stated ifthere is a projected over production then the acion will be taken as belows:

Inform related RSPO certification body and RSPO IT System. Re-analyze production data and mass balance report. Calibrated and recheck for the bridge and supporting equipments. To define the projection of certified product considering the error rate

(contamination) for maximum 5% from the total projection data.

C. Record keeping3.1 The facility shall maintain accurate, complete, up-to-date and accessible records and reports

covering all aspects of these requirements.

Records/Evidence: Surat Pengantar Buah (Fruit Delivery Letter) (SBYE) with “Mass Balance” mark Form

rekap Penerimaan TBS per Unit (FFB Receiving Resume from each Unit) CPO Production Report (daily, three-monthly, and annual)

All documents and records have been in controlled according to SOP PengendalianDokumen dan Rekaman (SOP Document Control and Record Control)SOP Pengendalian Dokumen (SOP Document Control)PT. SIP-SBYM/SOP/18 Rev.00, dated 02/01/2012SOP Pengendalian Catatan, dated 02/01/2012PT. SIP-SBYM/SOP/12 Rev.00, dated 02/01/2012

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

Records/Evidence:Retention times of all records have been determined in SOP Pengendalian Dokumen danRekaman (SOP Document Control and Record Control)Retention time for all records and reports of PT. Sumber Indah Perkasa is 10 years.

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

Records/Evidence:The company has the monthly, three-monthly, and annual report which contain record andbalance all receipts of RSPO certified FFB and deliveries of RSPO certified CPO and PK.(SBYM Mass Balance Monthly Report, SBYM Mass Balance Three-Monthly Report, andSBYM Mass Balance Annual Report)All volumes of palm oil and palm kernel oil that are delivered are deducted from the material



accounting system according to conversion ratios stated by RSPO.

Records/Evidence:There is a database system called Weightbridge Computerized Program which has beendesigned to align and integrate from the material accounting system according to conversionratios stated by RSPO. The supporting data such as:

Massa Balance Report ; Daily, Monthly, Three-Monthly, and Annually CPOProduction Report

Surat Pengiriman CPO dengan Cap ‘’ Massa Balance’’ (CPO DispatchLetter with “Mass Balance” Mark)

Tiket Timbang Pengiriman CPO dengan Cap ‘’Mass Balance’’ (CPODispatch Weight Ticket with “Mass Balance” Mark)

The facility can only deliver Mass Balance sales from a positive stock. However, a facility isallowed to sell short.

Records/Evidence:Can be trace down in CPO Stock Report and in CPO Dispatch Report

3.4 The following trade names should be used and specified in relevant documents, e.g.purchase.

Records/Evidence:Can be trace down in Sales Contract

D. Sales and good out4.1 The facility shall ensure that all sales invoice issued for RSPO certified products delivered

include the following information: a) The name and address of the buyer; b) The date onwhich the invoice was issued; c) A description of the product, including the applicable supplychain model (Segregated); d) The quantity of the products delivered; e) Reference to relatedtransport documentation.

Records/Evidence:The available evidence is the invoice of oil delivery in form of Delivery Order (DO) documentissued for every oil delivery. The information written on the Delivery Order document are:delivery no, delivery date, reference no, reference date, name and address of buyer, orderedproduct details, and the transportation system for product transportation.

The customer of SBYM for CPO and PK products are PT. SIP Bulking Tarahan.The transporter of SBYM are:- PT. Satrindo Jaya Agropalma (for PK and CPO)- PT. Abadi Wijaya Utama (for CPO)- PT. Lima Adil Makmur (for CPO)

E. Training5.1 The facility shall provide the training for all staff as required to implement the requirements of

the Supply Chain Certification Systems.Records/Evidence:The facility shall provide the training for all staff as required to implement the requirements ofthe Supply Chain Certification Systems.Records/Evidence:

SOP Training dan Kompetensi Sumber Daya Manusia (SOP Training andHuman Resources Competency) Document No.: PT SIP‐SBYM/SOP/19,issued 02/01/2012

RSPO – SCCS Training material is available in Identification Matrix Needs Invitation, Attendance List, Socialization Training Material RSPO–SCCS,dated

08 May 2013



F. Claims6.1 The facility shall only make claims regarding the use of or support of RSPO certified palm oil

that are in compliance with the RSPO Rules for Communication and Claims.

Records/Evidence:SBYM have 7 Declaration of RSPO SCCS1. Deklarasi RSPO ‐SCCS (RSPO SCCS Declaration)2. Deklarasi Prosedur RSPO‐SCCS Mass Balance (RSPO-SCCS Mass Balance

Procedure)3. Deklarasi Penilaian RSPO (RSPO Valuation Declaration)4. Deklarasi Penjualan dan Pengeluaran Produk (Sale and Product Output

Declaration)5. Deklarasi Penyimpanan dan dokumentasi rekaman (Retention and Record

Documentation Declaration)6. Deklarasi Nama Produk (Product Name Declaration)7. Deklarasi Klaim/Pernyataan (Claim Declaration)

RSPO Assessment Report - Sucofindo

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Transcript of RSPO Assessment Report - Sucofindo