roundtable on sustainable palm oil...00 08’22.6” 100 00’28.5” pt amp plantation estate 2...

Roundtable on Sustainable Palm Oil

Public Summary Report

Certification assessment against the

RSPO Principles & Criteria Indonesia National Intepretation Year 2008

Wilmar International Limited

PT AMP Plantation and PT Primatama Mulia Jaya

Report no.: 18501482

Report prepared by:

Dian Susanty Soeminta

Certification decision: Manfred Lottig

Certification Body:

TUV Rheinland Malaysia Sdn. Bhd. No. 26 – 32, Jalan Perindustrian USJ 1/6,

Taman Perindustrian USJ 1, 47600 Subang Jaya,

Selangor Darul Ehsan, Malaysia. Tel: +6 03 8024 2400 Fax: +6 03 8023 1505

www.tuv.com

TABLE OF CONTENTS

1.0 SCOPE OF CERTIFICATION ASSESSMENT 3

1.1 National Interpretation Used 3 1.2 Type of Assessment 3 1.3 Location and Maps 3 1.4 Description of Supply Base 5 1.5 Dates of Plantings and Replanting Cycles 5 1.6 Other Achievements and Certifications Held 6 1.7 Organisational Information / Contact Person 6 1.8 Environment and Socio-economic Context 7 1.9 Time Bound Plan for Other Management Units 10 1.11 Approximate Tonnages Certified 12 1.12 Date of Certificate Issued and Scope of Certificate 12

2.0 ASSESSMENT PROCESS 13

2.1 Certification Body 13 2.2 Qualifications of Lead Assessor and Assessment Team 13 2.3 Assessment Methodology 14 2.4 Stakeholder Consultation and Stakeholders Contacted 16 2.5 Date of Next Surveillance Visit 17

3.0 ASSESSMENT FINDINGS 18

3.1 Summary of Findings 18 3.2 Identified Non-conformances, Corrective Actions Taken and Auditors Conclusions 48 3.3 Noteworthy Positive Components 54 3.4 Issues Raised by Stakeholders and Findings Pertaining to Issues 54 3.5 Acknowledgements of Internal Responsibility and Formal Sign-Off by Client 64

APPENDICES 65

Appendix 1: Details of Certificate 65 Appendix 2: Certification Audit Plan 67 Appendix 3: List of Abbreviations 69 Appendix 4: List of Stakeholders Interviewed and Contacted 71 Appendix 5: Observations and Opportunities for Improvement 72

RSPO Certification Assessment Report


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1.0 SCOPE OF CERTIFICATION ASSESSMENT

1.1 National Interpretation Used

The operations of the palm oil mill and its supply base of FFB were assessed against the Indonesia national in-terpretion year 2008 of the RSPO Principles & Criteria.

1.2 Type of Assessment

The main certification assessment was carried out on one mill and 4 estates under PT AMP Plantation and 1 estate under PT Primatama Mulia Jaya owned by Wilmar International limited.

1.3 Location and Maps

Figure 1: Location of PT AMP Plantation and PT PMJ Plantation in West Sumatera

Location PT AMP & PT PMJ



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Figure 2: Plantation area PT AMP Plantation and PT PMJ Plantation

Table 1: Address and GPS location of PT AMP Plantation and PT PMJ Plantation in West Sumatera

Name of mill / es-

tate Location

GPS locations Latitude Longitude

PT AMP Plantation Palm Oil Mill

Tepian Kandir village, Palem-bayan sub District Agam District , West Sumatera

0009’17.610” 10001’44.891”

PT AMP Plantation Estate 1


0008’22.6” 10000’28.5”



0009’30.2” 9955’13.4.”



0010’47.7” 9949’06.5”



0004’22.7” 9948’09.8”

PT Primatama Mulia Jaya

Ampat Koto village, Kecamatan Sub District Kinali, Pasaman Bar-at District, West Sumatera

0004’22.7” 9948’09.8”

AMP Mill

PT. AMP & PT PMJ Location Map Agam & Pasaman District, West Sumatera

PADANG

AGAM DISTRICT

PASAMAN DISTRICT



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1.4 Description of Supply Base

PT AMP Plantation palm oil mill is one of the palm oil mills that is owned by Wilmar International located in West Sumatera. PT AMP Palm Oil Mill was established in 1992 with a production capacity of 60 tonnes/hours in accordance the decision letter no. 570/21/T/Pertanian/BKPPMD-2003 from the Head of the Modal Capital In-vestment Coordination Board (‘Badan Koordinasi Penanaman’- BKPM) of West Sumatra regarding handover of Permanent Business Permit (Izin Usaha Tetap) for PT Agramasang Perkasa Plantation (PT AMP Plantation) valid for January 1998 to January 2028. The company’s head office location is at Tapian Kandis village, Pa-lembayan Sub Districs, Agam District, West Sumatera Province. PT AMP Plantation Mill receives supplies from its 4 company-owned estates, FFB from PT Primatama Mulia Jaya, as well other estates under Wilmar Interna-tional Indonesia located within company’s West Sumatera, as describe below. The company also receives FFB from smallholders. The scope of this assessment only covers the 4 company-owned estates under PT AMP Plantation and PT Primatama Mulia Jaya. Table 2: FFB Supply for period January 2010 to December 2010

FFB Contributors FFB supplied

Tonnes %

I. The company owned estates:

PT AMP Estate 1 53,642.726 15.03

PT AMP Estate 2 57,512.156 16.12

PT AMP Estate 3 22,557.978 6.32

PT AMP Estate 4 14,144.368 3.96

PT PMJ 24,245.052 6.80

Sub Total ( I ) 172,102.280 48.23

II. Outgrowers contracted

PT PANP (Perkebunan Anak Nagari Pasaman)

20,287.792 5.69

PT KAMU (Karya Agung Megah Utama)

12,935.279 3.62

Sub Total ( II) 33,223.071 9.31

III. The company smallholders /

PT AMP 1 group 21,710.057 6.08

PT AMP 2 group 43,648.518 12.23

PT AMP 3 group 3,086.990 0.87

PT AMP 4 group 0 0.00

PT PMJ 12,087.291 3.39

Sub Total ( III ) 80,532.856 22.57

IV. Others (Independent outgrowers) 70,988.529 19.89

TOTAL ( I + II + III + IV) 356,846.736 100.00

1.5 Dates of Plantings and Replanting Cycles

Table 3: Dates of planting and replanting cycles Age & Year of Plant- Oil palm planted area at each estate(ha)



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ings PT AMP 1 PT AMP 2 PT AMP 3 PT AMP 4 PT PMJ

0 – 5 yrs (2006 – 2010) - - 187.5* - 44.97

5-10 yrs (2001 – 2005) - 198.60 400.4 174.85 841.78

10-15 yrs (1996 – 2000) 387.17 1512.14 1533.18 527.59 504.06

15-20 yrs (1991 – 1995) 1791.31 804.43 - - -

20-25 yrs (1986 – 1990) - - - - -

25 - 30 yrs (1981 - 1985) - - - - -

TOTAL 2178.48 2515.17 2121.08 702.44 1390.81

* Note: Planted in 2006

Table 4: Planned and actual oil palm replanting activities

Year

Total planned re-

planting area (ha)

Total planned replanting area for each estate (ha) Actual total area

replanted (ha) PT AMP 1 PT AMP 2 PT AMP 3 PT AMP 4 PMJ

2011 - - - - - - -

2012 - - - - - - -

2013 - - - - - - -

2014 - - - - - - -

2015 513.98 513.98 - - - - -

2016 206.34 206.34 - - - - -

1.6 Other Achievements and Certifications Held

Table 5: Details of other certifications or awards held by PT AMP Plantation

Name of mill / es-tate

Certification Standard / Award

achieved

Certification Body /

Awarder

Date Achieved

PT AMP PLANTATION

ISO 9001:2008 No. Register 01 100 075834

TUV Rhein-land

08-08-2011

ISO 1400:2004 No. Register 01 104 075834

TUV Rhein-land

08-08-2011

1.7 Organisational Information / Contact Person

Contacts details of the company are as follows:



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1.8 Environment and Socio-economic Context

Wilmar International Plantation has managed PT AMP plantation since 1992 formally, after joint venture with Jago Rawi Group as plantation management which was established in 1990s. In the beginning all PT AMP land used to be customary land which was given by the customary land owners to the local government for investment, and this in turn was handed over to PT AMP by the local government to be an oil palm plantation with smallholder’s scheme.

Some customary land which was handed to PT AMP by the local government was the following areas: (1) Nagari Tapian Kandis, (2) Nagari Tompek, (3) Nagari Bawan, (4) Nagari Kinali, (5) Nagari Mangopoh, (6) Nagari Tiku, (7) Nagari Katia-gan and (8) Kampung Pisang. Total allocated land for oil palm plantations is 10,351.10 ha for the company-owned land and 5,060.90 ha for plasma (smallholder scheme). However due some local communities sold they land to AMP manage-ment, total area that include on the company’s HGU both for PT AMP and PT PMJ plantation is 11,166.42 ha. Currently PT AMP plantation divided their plantation into 4 estates including their smallholders, as follows:

Unit PT AMP 1, with 4 smallholders group, i.e;: Plasma 1 (KPS Tompek Tapian Kandis/TTK) Plasma 2 (KUD Damai Sejahtera/Dastra 2) Plasma 3 (KUD Mutiara Sawit Jaya/MSJ) Plasma 4 (KUD Bukit Sanding Tigo/BST)

Unit PT AMP 2, with 1 smallholder group i.e.: Plasma 5 (KUD Mutiara Sawit Jaya/MSJ)

Unit PT AMP 3, with 2 smallholder groups i.e: Plasma KUD Damai Sejahtera/Dastra 2 Katiagan Plasma (KUD Mutiara Sawit Jaya/MSJ)

PT. PMJ manages a combined land area which is legally divided into three different areas with three separate land use certificates (Hak Guna Usaha – HGU), as follows: HGU area for PT. PMJ for total of 1,940 ha, HGU area of PT. AMP Plantation for total of 1,300 ha, and HGU area of smallholders group members of the KUD Damai Sejahtera Kinali for area of 1,680 ha. Customary leaders handed over a total of 7,550 ha of land to local government in 1996 for PT PMJ, with the land consisting of 3,300 ha of the company owned land and and 4,250 ha of smallholder land.

Administratively, the location of PT AMP Plantation estate I,II,III and PT AMP mill is in Tapian Kandis village, Palem-bayan sub district, Agam district, while location of PT AMP estate IV and PT PMJ in West Pasaman is in IV Koto Vil-lage, west Pasaman district, which is 3-4 hours travel time from Padang city, West Sumatera Province.

PT AMP Plantation has 4 estates i.e. PT AMP 1,2,3 and 4 while PT PMJ only has 1 estate. The table below lists general information on PT AMP Plantation and PT PMJ Plantation surrounding stakeholders and estate conditions:

Company Name: PT AMP Plantation & PT Primatama Multi Jaya

Address: PT AMP Plantation

Tapian Kandis Village, Palembayan Sub District, Agam District, West Su-matera Indonesia

PT Primatama Multi Jaya

IV (Ampat) Koto Village Kinali sub District, West Pasaman District- West Sumatera

Contact Person:

Mr. Lo Koon Wai

Telephone: + 628126626505

Email: [email protected]



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Table 6: Summary of Environmental Conditions and Stakeholders surrounding PT AMP Plantation and PT PMJ

No. PT AMP Plantation PT PMJ Plantation

1. Government administration location

Agam District West Pasaman District

Plantation Official administration

Agricultural local office of Agam Agricultural local office of West Pasaman

2 Watershed areas DAS Masang Gadang DAS Masang Antokan 3. Total Area 9226.42 ha 1940 ha 4. Topography Undulating Undulating 5. Soil type Group of deep Peat, Alluvium

and group of Vulcan Group of deep Peat, Alluvium and group of Vulcan

6. Climate type Type A (Schmidt Pergusson ) Type A (Schmidt Pergusson )

Documents demonstating PT AMP Plantation as a legal entity is as described in the table below:

Establishment act : Notariat act Ny. Julinar Idris, SH.No. 1, dated April, 5 1994 with lat-est changed act No. 77 dated April 05, 2002.

President of Indonesia ap-proval (‘Surat Persetujuan Presiden’/SPP)

: Letter of Approval from President for Foreign Investment by the company, No. 99/I/PMA/1993, dated June 18, 1993 by Menives/BKPM.

Business license permit (Ijin Usaha Perkebunan /IUP)

: No. 495, dated August 8, 2008, with area 7,925.42 ha and perma-nent business license No. 570/21/T/ Pertanian /BKPPMD-2003 val-id from January 1998 to January 2028.

Location permit : BPN Agam district, No. 402/BPN/94, dated June 21, 1994 with to-tal area 5,000 ha No. 402/43/BPN/95, dated 11 January 1995, with total 1,300 ha No. 402/44/BPN/95, dated January 11, 1995 with to-tal area 1,500 ha

Land Use Right (Ijin Hak Guna Usaha)

: 1.SK HGU Nomor 102/HGU/BPN/1997 with total area 2,674 from National Land Agency (BPN) decree letter. Consist of two HGU certificates i.e.

- no. 10 with area 1,340 ha valid from October 29, 1997 to October 29, 2027

- no. 09 with area 1,334 ha valid from October 29, 1997 to October 29, 202

2. SK HGU nomor 29/HGU/BPN/1999/A/21 from National Land Agency (BPN) decree letter , issued HGU certificate:

- no. 12 with area 714 ha valid from March 31, 2004 to March 31, 2034

- no. 11 with area 4,360 ha valid from March 31, 2004 to March 31, 2034

2. SK HGU Nomor 14-540.1-23-2004 with area 178.42 ha, i.e. certificate no. 01 valid from September 1, 2004 to September 1, 2029.

3. SK HGU Nomor 13/HGU/BPN/2000 with total area 1,300 ha, HGU certificate no. 15. valid from Augus 23, 2000 until August 25, 2030.

AMDAL : Environmental Management Program (Upaya Pengelolaan Ling-kungan/UPL) and Environmental management and monitoring doc-ument year 2006.

Documents demonstating PT Primatama Mulia Jaya (PT PMJ) as a legal entity is as described in the table below:



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Establishment act : Auction process in PUPN Padang. No : 214/1997 – 1998, dated

August 28, 1997 from PT. Pasaman Permai transferred to PT. Kartika Putra Satria. According to Notariat, No.268, dated Septem-ber 30, 1994, with last revision act no. 11 dated August 12, 1996.

President of Indonesia ap-proval (Surat Persetujuan Presiden/SPP)

: Letter of Approval from President for Foreign Investment the com-pany (PMA) No. 197/V/PMA/1999, dated June 18, 1993 1993 oleh Meninves / BKPM

Business license permit (Ijin Usaha Perkebunan /IUP)

: No. 283/T/Pertanian/2005, dated April 01, 2005. Plantation Busi-ness Registration letter No. 206/menhutbun-VII/2000 for PT Pri-matama Mulia Jaya for total areal 1940 ha.

Location permit : National Land Agency (BPN) Pasaman District, No. 402.1331/BPN-1996, dated October 26, 1996 with total area 1,940 Ha.

Ijin Hak Guna Usaha, Land Use Right

: National Land Agency (BPN), No. 3/HGU/BPN/98, dated January 15, 1998 with total area 1,940 Ha

AMDAL : Upaya Pengelolaan Lingkungan (UPL) and Environmental Man-agement and Monitoring Plan (Dokumen Pengelolaan dan Peman-tauan Lingkungan - DPPL), year 2009

The total land transfered from customary land into Plantation and mill area since 1991 until 2011 is 14,608.11 ha. The customary lands were from Tompek, Tapian Kandis, Bawan, Kinali, Tiku, Kinali, Katiagan and Manggopoh vil-lage. Since the beginning, this land transfer had no clear boundary; it was only based on ex-farming activities and history from former generation. This has resulted in several land conflicts for the customary land, some occuring be-tween the communities (not involving the company) and some involving the company who manage the land. The government tried to be involved in the conflict settlement through Land Use Agency (BPN) which carried out the appropriate land survey and boundary consultation with customary leaders. However, several cases are yet to be resolved. At the time of the RSPO assessment, some internal conflicts among customary leaders still continued to prevail through the customary organizations such as the Communication Forum (Forum Komunikasi), Reformasi Ninik Mamak Pemuka Masyarakat Pemuda Bawan which claimed their areas were occupied by Manggopoh village. This happened since 1988 and is still yet to be resolved.There is no clear decision from government, and govern-ment requested the local people to solve the problem internally through customary justice. Government only acts as facilitator. PT AMP and PT PMJ are located close to the coastline of West Sumatera, as such, most of the areas consist of lowlands and peat. The company’s soil survey map indicates that about 45% of the areas are peat whose depth variations are shown on the table below : Table 7: Depth of peat soil distribution at PT AMP Plantations and PT PMJ.

Estate name Depth0-2 m 2-3 m > 3 m

PT AMP 1 - - -PT AMP 2 796.33 290.94 -PT AMP 3 250.17 618.64 923.19PT AMP 4 137.32 26.39 -PT PMJ 455.29 556.23 107.43Total 1639.11 1492.2 1030.62

To ensure that there is no soil damage from plantation activities such as subsidence acceleration in peat area, com-pany implements a water management program through canalization and water level control in every canal into de-fined level (50 to 75 cm). The company installed subsidence monitoring points in every estate according to the depth peat, company also has water gates to control water level in every canal.



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There were several new plantings after year 2007 in PT PMJ and PT AMP 4 which were carried out inside the com-pany’s areas. The company deferred plantings in these areas because of several reasons such as incompletion of land acquisition or unsettled land disputes among the customary leaders. There was no new planting on new devel-opment area or extension area.

1.9 Time Bound Plan for Other Management Units

Table 8: Time Bound Plan of Wilmar International Group

Name of Estates Location Land area (ha) Year of Audit

PT Milano (SDE, BSE & MBE) North Sumatra 4975 2009

PT Mustika Sembuluh Central Kalimantan 15,897 2009

PT Tania Selatan (BT & BB) South Sumatra 3775 2010

PT Kerry Sawit Indonesia Central Kalimantan 14,980 2010

PT Kencana Sawit Indonesia West Sumatra. 7,728 2010

PT Bumi Sawit Kencana Central Kalimantan 7,266 2011

PT AMP Plantation West Sumatra 7,541 2011

PT Primatama Muliajaya West Sumatra 1,397 2011

PT Sarana Titian Permata Central Kalimantan 14,995 2011

PT Buluh Canang Plantations South Sumatra 223 2011

PT Tania (Bamboo Kuning) South Sumatra 1800 2011

PT ANI (Sambas) West Kalimantan 9,095 2011

PT Daya Labuhan Indah North Sumatra 5,010 2012

PT Milano (CDE) North Sumatra 618 2012

PT Citra Riau Sarana Riau 2,268 2012

PT Gersindo Minang Plantations West Sumatra 3,146 2012

PT Permata Hijau Pasaman West Sumatra 2,363 2012

PT Mentaya Sawit Mas Central Kalimantan 7,120 2012

PT Asiatic Persada Jambi 15,223 2012

PT Pratama Prosentindo West Kalimantan 3423 2012

PT Putra Indotropical West Kalimantan 3133 2012

PT Sinarsiak Dianpermai Riau. 1,114 2012

PT ANI (Landak) West Kalimantan 4281 2013

PT Murini Sam Sam Riau 1,288 2013

PT Agro Palindo Sakti South Sumatra 872 2013

PT Musi Banyuasin Indah South Sumatra 4473 2013

PT Karunia Kencana Permaisejati Central Kalimantan 8,070 2013

PT Agro Palindo Sakti West Kalimantan 5033 2013

PT Daya Landak Plantation West Kalimantan 3774 2013

PT Indoresins Putra Mandiri West Kalimantan 3730 2013

Total 164611

Name of Palm Oil Mills Location CPO output (mt) Year of Audit

PT Milano (Pinang Awan) North Sumatra 27,554 2009

PT Mustika Sembuluh Central Kalimantan 81,350 2009



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PT Tania Selatan South Sumatra 12,800 2010

PT Kencana Sawit Indonesia West Sumatra. 37,200 2010

PT Kerry Sawit Indonesia Central Kalimantan 51,335 2010

PT Bumi Sawit Kencana Central Kalimantan 27,700 2011

PT AMP Plantation West Sumatra 37,900 2011

PT Buluh Canang Plantations South Sumatra 33,800 2012

PT Agro Nusa Investama (Sambas)

West Kalimantan 17,600 2011

PT Sarana Titian Permata Central Kalimantan 37,800 2011

PT Sinarsiak Dianpermai Riau 6,400 2012

PT Daya Labuhan Indah-2 North Sumatra 25,800 2012

PT Citra Riau Sarana (ML) 1 + 2 Riau 46,300 2012

PT Gersindo Minang Plantations West Sumatra 35300 2012

PT Mentaya Sawit Mas Central Kalimantan 28,800 2012

PT Asiatic Persada Jambi 57,300 2013

PT Agro Nusa Investama (Landak)

West Kalimantan 30,600 2013

PT Murini Sam Sam Riau 7,500 2013

PT Musi Banyuasin Indah South Sumatra 35,400 2013

PT Karunia Kencana Permaisejati Central Kalimantan 41,400 2013

PT Agro Palindo Sakti 1 West Kalimantan 19,400 2013

PT Citra Riau Sarana 3 Riau 20000 2013

Total Total 719,239

There are several changes to the company’s timebond plan due to some reason such as:

1. PT Bumi Kencana Sawit, some social issues are still not resolved and community still not agree with the company’s proposed Memorandum of understanding regarding conflict resolution process accord-ing to RSPO criteria.

2. PT Buluh Canang Plantation/ PT Tania Selatan (Bamboo Kuning estate), due to some social issue and land legal documents still not completed

3. PT ANI Sambas, will be conducted in 2012. 4. PT Sarana Titian Permai, will be conducted 2012. 5. PT Asiatic Persada, some significant land conflict still not resolved yet.

1.10 Area of Plantation (Total, Planted and Mature) Table 9: Area Statement until December 2010 for PT AMP Plantation and PT PMJ Plantation

Name of Estates Area Summary

Total (ha) Planted (ha) Mature (ha)

PT AMP Estate1 2,371.71 2,178.48 2,178.48

PT AMP Estate 2 2,695.00 2,515.17 2,515.17

PT AMP Estate 3 2,859.71 2,121.08 1,933.58 PT AMP Estate 4 1,300.00 702.44 702.44

PT PMJ 1,940.00 1,390.81 1,345.84

Total 11,166.42 8,907.98 8,675.51



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Table 10: Oil Palm Planted Area Summary, Projected FFB Production and Average Yield/ha for PT AMP Plantation and PT PMJ Plantation year 2010

Estate NameTotal area

(ha)

Oil Palm Planted area

(ha)

Mature (Production)

area (ha)

Immature (Non-production)

area (ha)

FFB Production

(tonnes)

Average yield/ ha

PT AMP 1 2371.71 2178.48 2178.48 - 53.642.73 24.62 PT AMP 2 2685.00 2515.17 2515.17 - 57,512.16 22.87PT AMP 3 2859.71 2121.08 1933.58 187.51 22,557.98 11.66PT AMP 4 1300.00 702.44 702.44 - 14,144.37 20.13PT PMJ 1940.00 1390.81 1345.84 44.97 24,245.05 18.01

Total 11,166.42 8,907.98 8,675.51 232.48 172,102.28 19.83

Table 11: Land use data for PT AMP Plantation and PT Primatama Mulia Jaya

*

N

Note : 1. Inside planted area 2. Considered as HCV area 3. there is 77.06 ha considered as HCV area inside this location

1.11 Approximate Tonnages Certified

Total CPO produced in year 2010 as reported on the annual company’s performance 2010 from all incoming FFB is 68,172.641 and Palm Kernel produced is 16,738.234 tonnes. According to information in Table 2. FFB from the company’s owned estate for period January 2010 to December 2010 only 48.23% from all incoming FFB the rest is from outgrowers and smallholder whis are still not included in certification scope. From that in-formation The approximate tonnages certified according to December 2010 monthly production reports: Crude Palm Oil (CPO) : 32,880.00 tonnes Palm Kernel (PK) : 8,073.00 tonnes OER : 19.43% KER : 4.64 %

1.12 Date of Certificate Issued and Scope of Certificate

The scope of the certificate covers production of palm oil from PT AMP Mill and its supply base, which includes PT AMP estate 1, estate 2, estate 3, estate 4 and PT PMJ plantation. The date of certificate issued is 7 June 2012. Further details of the certificate are as per Appendix 1.

Estate Name

Total area (ha)

Oil Palm Planted Ar-

ea (ha)

HCV/

potential HCV areas1

(ha)

Land used for other purposes (ha)

Housing, Road, drain

NurseryPlantable reserve

Non plantable

area

Conflict

area/

EnclavePT AMP 1 2371.71 2178.48 45.69 193.23 - - - -PT AMP 2 2695.00 2515.17 14.6 179.83 - - - - PT AMP 3 2859.71 2121.08 32.23 127.05 29.42 25.89 95.52 461.22PT AMP 4 1300,00 702.44 78.00 - - - 519.563

PT PMJ 1940.00 1390.81 - 125.41 - 183.01 - 240.77Total 11,166.42 8,907.98 92.52 703.52 29.42 208.9 95.5 1221.55



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2.0 ASSESSMENT PROCESS

2.1 Certification Body TUV Rheinland Malaysia Sdn. Bhd. is member of Group TÜV Rheinland Group, a global leader in independent testing and assessment services. The TÜV Rheinland Group was established in 1872 with offices located in over 360 locations in 62 countries on all five continents. TUV Rheinland Malaysia offers certification for a wide range of management systems according to established international standards including ISO 9001, ISO 14001, OHSAS 18001, SA 8000, as well as CDM Project Validations and Verifications. TUV Rheinland Malaysia’s of-fice is located in Subang Jaya.

2.2 Qualifications of Lead Assessor and Assessment Team

Name Position Qualifications / Experience

Dian S. Soeminta

Lead Au-ditor

Education: Bachelors Degree in Forestry - Bogor Agriculture Institute. Indo-nesia, (1990 to 1995). Trainings attended: ISO 9001:2000 lead assessor course 1996 - Neville Clark; ISO 14001 lead assessor course - PE International; OSHAS: 2007 training, Sustainable Forest Management (SFM) - Forest Stewardship Coun-cil (FSC) system training; Chain of Custody training for FSC System. Working experience: Professional forester since 1995 to 2000. Lead Audi-tor for Forest Stewardship Council (FSC), Sustainable Forest Certification (SFC) and Chain of Custody (COC) Certification. Lead auditor for Environ-mental Management System (EMS) and Quality Management System (QMS) audits. Conducted sustainable forest management certification audits on FSC and Indonesian Ecolabel Institute (Lembaga Ecolabel Indonesia - LEI) standards for 20 companies, 50 COC FSC/LEI audits, and EMS and QMS audits at more than hundred companies for TUV Rheinland Indonesia. In-strumental in the preparation of TUV Rheinland Indonesia for Sustainable Forest Management Certification System and TUV Rheinland Malaysia for RSPO Certification. Member of Task Force for Indonesian National Interpre-tation (Guidance on scheme smallholder RSPO certification). Developed TUV Rheinland RSPO Gap Assessment Checklist and report template.

Fadli Auditor

Education: Bachelor of Anthropology, Department of Anthropology - Univer-sity of Indonesia, Jakarta. Trainings attended: Sustainable Natural Production Forest Management (Pengelolaan Hutan Alam Produksi Lestari - PHAPL) assessor training (May 2003); Forest Plantation Management (August 2003) training - Indonesian Ecolabel Institute (LEI), Forest Management and Agriculture Auditor Train-ing; ISO 9001:2008, ISO 14000:2004, OHSAS 18001:2007 trainings - Smartwood/Rainforest Alliance; SA8000 training - SA International; RSPO Lead Auditor Training -Indonesian Palm Oil Commission. Working experience: Experienced as lecturer for D3 Tourism program, Uni-versity of Indonesia. Social aspect auditor of PT. TUV International Indonesia for Sustainable Forest Management and RSPO Principles & Criteria. Re-searcher of stakeholder mapping for CSR Indonesia.

Nelly Yong Auditor

Bachelor of Science (Chemistry & Biology), Campbell University, USA. (1994 to 1997). Previously worked as a Research & Development Chemist & Quality Control Chemist in a Switzerland based multinational company since 1997 to 2002. Experienced in hands-on implementation of EMS, including ensuring all applicable environmental legal requirements are complied, operation of waste water treatment plant including waste water lab test analysis, responsible for chemical waste management, environmental aspect & impact evaluation etc. Previously a management system consultant for various standards such as ISO 9001, ISO 14001, ISO/TS 16949, OHSAS 18001 etc starting from 2002 till



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2006. She has been involved as an auditor for a 3rd party certification body since year 2002. Instrumental in the preparation of TUV Rheinland (Malaysia) for RSPO Certification. Lead Auditor for ISO 9001 & ISO/TS 16949 & auditor for ISO 14001 and has audited more than hundred companies for EMS and QMS audit for TUV Rheinland Malaysia

Agus Salim Alfat

Auditor

Education: Bachelor Degree of Chemistry - Bandung Institute of Technolo-gy, Indonesia (1988 to 1993); Master Degree of Quality, Safety and Envi-ronment - Otto Von Geuricke, Magdeburg University, Germany (2001 - 2002). Trainings attended: ISO 9000:2000 Series Auditor / Lead Auditor Training - PE International (Jakarta), IEMA Advanced EMS Auditor (IEMA / EARA ISO 14001) Auditor / Lead Auditor Training Course - PE International (Jakarta), OHSAS 18001 Lead Auditor Training Course - PE International (Jakarta). Working experience: Experienced in Quality Control from 1994-2004. Audi-tor for Quality Management System since 2004 – present. Auditor for Envi-ronmental Management System since 2005 – present. Auditor for OHSAS 18001 since 2007 - present. Conducted over 100 Quality Management Sys-tem audits since 2004, over 50 Environmental Management System audits since 2006 , and over 25 OHSAS audits since 2007

Irpan Kadir Auditor

Education: Bachelor of Agriculture, Department of Social and Economic of Agriculture, Bogor Institute of Agriculture.

Trainings attended: Sustainable Natural Production Forest Management (Pengelolaan Hutan Alam Produksi Lestari - PHAPL) assessor training (May 2003); Forest Plantation Management (August 2003) training - Indonesian Ecolabel Institute (LEI). Working experience: 2 years experienced as external auditor of PT. TUV International Indonesia for Sustainable Forest Management and RSPO Prin-ciples & Criteria. Has experience in conducting assessments of performance and social mapping for mining and forestry companies. He is a senior re-searcher and trainer at A + CSR Indonesia.

2.3 Assessment Methodology The assessment was carried out in accordance with TUV Rheinland Malaysia’s RSPO audit procedure as well as the RSPO Certification Systems document. During assessment the qualified TUV Rheinland Malaysia as-sessor used the RSPO standard as endorsed for the country in which the assessment took place and recorded their findings. Due to the location and proximity of the estate, combined with common management systems and information derived during the gap-assessment, it was possible to carry out both field and office assessment of all 3 estates within the time frame without compromising the integrity of the assessment in anyway. All 4 estates and the 1 mill were visited and the assessment team carried out field and office assessments of compliance for all the RSPO principles and criteria. Common systems were identified and specific evidence was recorded for individual estates. Interviews were at all estates and at the mill. As some major indicators were not fulfilled during the main assessment, some major non-conformances were raised. The company proposed the correction and corrective action for all identified non conformities to the cer-tification body within 15 days from the closing meeting. Verification of closure of major non-conformances was conducted 2 months after the closing meeting of the main assessment. The main assessment agenda and veri-fication of major non-conformances was conducted as explained below.



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The Assessment Agenda. The RSPO Certification Audit was conducted from 04 to 09 July 2011, according to the agenda below.

Date Location/ Main sites

Main activities

July 04, 2011

Bumi Maninjau Resort Hotel

Stakeholder Meeting Focus Group Discussion

PT AMP plan-tation

Compiling Stakeholder issues

July 05, 2011

Regional Of-fice PT AMP Plantation

Opening Meeting. Introduction by team leader. Introduction of team members and assessment agenda Presentation from PT AMP management Document review from all aspects

PT AMP Mill Plant tour to the whole area of POM to checking the implementation of PPE, OHS and waste handling.

Interview worker, contractors and suppliers Checking of actual condition of chemical storage and hazardous waste

storage Interview personnel in charge of identifying and checking compliance

to all relevant legal and other requirements such as those associated with environment, labor, OHS, and mill regulations.

Checking related document procedures and records. Interview personnel (operational head) associated with the SOP and

implementation and also monitoring activities. Interview personnel responsible for OHS and First Aid monitoring Interview personnel responsible for training of OHS and First Aid Interview doctor responsible for conducting regular health checks for

operator Checking of documents related to above Site visit to fields estate 1 blok 6A, 6 B for verification of land applica-

tion program July 06, 2011

PT AMP 3 es-tate PT AMP 2 es-tate

Site visit to division 2 and division 3 to check the implementation OHS and First Aid and also handling of agrochemicals.

Interview worker (harvesters, manurers and sprayers) Interview FFB transporters Interview to road maintenance contractor Checking availability of PPE, OHS and first aid equipment to worker and in

vehicles and fulfillment of OHS requirements Checking of generator set, use of diesel and handling of waste Visit to housing at Division 2 and 3 and make sure all waste handling follow

RSPO requirements Checking the landfill for wastes (organic and inorganic) at Division 2 Checking of chemical handling, management of chemical waste and other

hazardous waste handling at divisions, and housing. Interview contractors (transportation) Checking all documents and records related to the implementation of these

aspects Chcking Water Management system for peat area, subsidence monitporing

point, wiers and canal. Checking HCV area Checking boundary stone with local people area Verfication of document and records about maintenance of legal boundaries (budget and realitation, etc) Checking of actual condition of legal boundaries (number : LXXV, PT AMP 73, 69, 18, 71, 70, XXIX, XXV, XXI, VII) Interview personnel responsible for legal use land Checking related procedures, documents, maps and records related above



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Verification of document about HCV (identification, measures to preserve, action/activity) Checking of condition of HCV areas, posters & signs warning Interview personnel responsible for HCV

Checking related procedures, documents, maps and records related above Interview with local comunities Jorong Limpato, Nagari Kinali Interview with KUD MSJ 1 & 2 manager Interview with KUD Manggopoh Interview with local communities Nagari Kandis

July 07, 2011

PMJ esatate & PT AMP 4 estate

Interview of workers & observation of housing condition and facilities at PMJ division 1 block 3000 and other housing areas.

Interviews with female workers and the contractors Visit to housing of temporary workers Verfication of document and records about maintenance of legal bound-

aries (budget and realitation, etc) Checking of actual condition of legal boundaries (number : BPN III, 10,

04, 15, 14, 7B, XLIII) Interview personnel responsible for legal use land Checking related procedures, documents, maps and records related

above Verification of document about HCV (identification, measures to pre-

serve, action/activity) Checking of condition of HCV areas, posters & signs warning Interview personnel responsible for HCV Checking related procedures, documents, maps and records related

above Farmer group Harapan 2, Koto Baru village Interview with local communities Mandaingin, and Anak Ayia Kasiang Visit to local communities in Kinali

July 08, 2011

PT AMP 1 es-tate

Closing meeting and present findings

July 09, 2011

PT AMP Re-gional Office

End of audit and traveling to Padang west Sumatera

2.4 Stakeholder Consultation and Stakeholders Contacted The stakeholder consultation involved both external and internal stakeholders. External stakeholders were noti-fied to make comments on the certification assessment by placing an invitation to comment on the RSPO web-site. Stakeholders included those immediately linked with the operation of the company such as employees, outgrowers, the local government, NGO’s, trade and labour unions and local communities. Stakeholder consultation took place in the form of meetings and interviews. Meetings with stakeholders were held to seek their views on the performance of the company with respect to the sustainability practices outlined in the RSPO Principles & Criteria, and to comment on aspects where improvements could be made. Meetings with local communities were held at their respective premises within and near the company’s area. A stake-holder consultation meeting was also held at Bumi Maninjau Resort Hotel, West Sumatera on July 04, 2011. Letters inviting individual stakeholders to the stakeholder consultation meeting were prepared and sent to the individual stakeholders, while electronic mail and telephone calls were made to arrange the meetings. In all the interviews and meeting, the objectives of the RSPO and the purpose of the assessment was clarified at the outset followed by an evaluation of the relationship between the stakeholders and the company before discussion proceeded to obtain the stakeholders feedback on the company’s compliance to different aspects of the RSPO Principles & Criteria. Although several stakeholders were not familiar with RSPO but they agreed with its objective and expressed their willingness to collaborate in the promotion of sustainable palm oil in West Sumatera province. In all interviews and meeting, the assessment team did not restrict discussion of both the positive and negative aspects of operations conducted by PT AMP & PMJ Plantation estates and mill. No man-



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agement representatives of the company were present during stakeholder consultation in order to prevent any forms of intimidation. The stakeholder consultation meeting held with stakeholders during the audit was extensive and productive, with an attendance of about 57 attendees. This was followed by site inspections, including visits to the local communities, interviews with land claimants and contractors, and inspections of worker amenities and infra-structure. All stakeholder issues raised were recorded and forwarded to the management for their written re-ponse, and this is summarized in Section 3.4.The list of stakeholders that attended the stakeholder consultation meeting and stakeholders interviewed during the assessment is included as Appendix 4.

2.5 Date of Next Surveillance Visit The next surveillance visit is planned for 7 April 2013.



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3.0 ASSESSMENT FINDINGS

3.1 Summary of Findings Since the company became a member of RSPO in September 2005, company’s management has committed to comply to all RSPO principles and criteria in all the company operations activities. As implementation of its commitment, the company applied to TUV Rheinland Malaysia to conduct the assessment of their compliance to all RSPO requirements for PT AMP Plantation and PT Primatama Jaya Mulia which supply to PT AMP palm oil mill. A pre - assessment was conducted in July 25 to 30, 2010 and the company has worked hard to address all identified non conformities raised during the pre-assessment. There is evidence of a considerable effort on behalf of all staff in the preparation of manuals, standard operat-ing procedures and other documents not only to conform to RSPO requirements, but for the company’s im-provement of process effectiveness and efficiency. The stakeholder consultation meeting held before main audit was an extensive and productive meeting attend-ed by more than 57 persons including local community representatives, suppliers, local government personnel, NGOs, and FFB transporters. The stakeholder consultation was follows by site inspections of infrastructure and social amenities. The management responded to all of the issues raised and this is summarized in section 3.4. In general, objective evidence was obtained from each of PT AMP and PT PMJ estates as well as its mill. The results from the assessment of each site within the certification unit have been aggregated to provide an as-sessment of overall conformance of the company’s to each criterion. During the certification assessment there were found 13 non conformities againt RSPO requirement, 1 noncon-formance was assigned against a Major Compliance indicator while 12 nonconformities were assigned against Minor Compliance Indicators. 15 observations or opportunities for improvement were identified. Further expla-nation of the non-conformities raised and corrective actions taken by the company are provided in Section 3.2. The observations & opportunities for improvement are listed in Appendix 5. The following is a summary of findings made for the criteria listed in the RSPO Principles & Criteria Indonesia National Interpretation year 2008.

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

Findings: Requests for information made by stakeholders at the palm oil mill and the estates were recorded in one document together with any other requests or letters received from stakeholders, as required by the company’s procedure. As seen from the company’s log book, there are some records of request of information with corresponding response from the company, as follows:

- A letter dated 5 May 2010 from the Man Power Department Agam District requesting the company’s

report for accident insurance (JAMSOSTEK). There is a letter dated on 24 May 2010 from the com-pany in response to this information request from Man Power Department.

- Letter from Koperasi Serba Usaha (KSU) Mutiara Bosa Sikilang no. 042 KSU/-MBS/XII/2010 on 27 Dec 2010, subject: Payment proposal for FFB harvesting result Sikilang smallholder since January 2011 was transfer to account number 3490002558

- Letter from Forestry and Plantations Department of Agam no. 522.2/200/BUN-II/2011 on 18 Febru-ary 2011, subject: Request for data for monitoring and evaluation of plantation

- Letter from Wali Nagari Salareh Aia no. 641/26/Pem-Nag/2011 dated 22/02/2011 requesting dona-tion.

There are records of company’s responses e.g. no. 13/ AMPPOM-MM Ext-III/2011 dated March 11, 2011 stated that donation proposal is under management review process. There are receiving notes of the response and approval evidence from letter receivers on March 11, 2011. There is another com-pany’s response for incoming letter kept by administration staff.



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It is mentioned in PT AMP’s standard operating procedure Pro-Gen-002, rev 02, dated January 05, 2009, that the company shall maintained all records of requests for information and responses made by the company for at least 3 years. Evidence so far shows that company maintains these records in ac-cordance with this SOP. Compliance status: Full Compliance

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

Findings: As evidence that company makes their management documents publicly available to stakeholder, company has sent a letter no 20/RO-AMP/Ext-VII/2010 dated July 10, 2010 to their stakeholders in-forming them regarding documents that are publicly available. The company’s documents that can be accessed by the public as stated in the company’s procedure no. PRO-BNM-006 and letter from PT AMP & PT PMJ Management no. urat nomor 20/RO- AMP/Ext-VII/2010 dated July 10, 2010 include company’s social and environmental impact assessment (DPL i.e. Environemntal Management Docu-ment), environmental management and monitoring reports (‘laporan RKL/RPL’), the company annual reports, company policies, copies of licenses, monthly mill and estates operational reports, area statements, soil maps, hydrology maps, topography maps, maps of estate and village boundaries, tra-ditional rights areas, estate and mill procedures, company organization structure, high conservation value (HCV) reports and management plans, social impact assessment (SIA) report, company maga-zine and bulletins, investment activity reports, estate activity reports, estate statistic monitoring reports, company worker information, expatriate information, land usage information, CPO purchasing infor-mation and the company Community Development and CSR report. There are receipt slips received from stakeholder, including local community and relevant government institutions, indicating that they have received this information letter. The company communicated to local people to inform about management documents that are publicly available on May 21, 2011 in Nagari Bawan village as seen on the attendance list, there were 87 partic-ipants that came during that event. Communication was also done at Nagari Salareh Aia on April 9, 2011 which is attended by 45 participants as seen from the list of participants. The company has a procedure to maintain records of information requested and responded to for a minimum of 3 years. Compliance status: Full Compliance

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

Findings: The company provides a mechanism for evaluation of implementation and compliance to applicable le-gal requirements in a standard operation procedure i.e. PRO-BNM-005, rev 0, tanggal 5 Oktober 2008. There are also procedures which defines the mechanism of evaluation of compliance to regulations re-lated to the company's plantation, legislation related to the environment, legislation relating to labour, and regulations related to health and safety. The SOP states that the identification and evaluation is to be carried out 2 (two) times a year and conducted by the staff, to be assisted by the EHS Binamitra of-ficer and (Personnel and General Affairs (PGA) officer and supported by the Head of Operations / field and other departments within the company organization. The company maintains a list of all applicable legal requirements relating to environmental, occupa-tional safety and health, the company plantations, and employment as well as records of internal com-pliance checks to legal requirements. Some evidence of compliance with relevant legal requirements as seen on latest legal requirements register i.e. "Daftar Peraturan & Perundangan" revision 04, dated 2 May 2011 was sighted - covering for both mill & estates under PT AMP Plantation. For example: - Decree letter from Local Investment Coordination Body (BKPM /Badan Koordinasi Penanaman Mod-



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al) West Sumatera province Nomor. 570/21/T/Pertanian/BKPPMD-2003 regarding Business License permit for PT Agramasang Perkasa Plantation (AMP Plantation) valid since January 1998 to January 2028. Evidence of reporting of inventories of hazardous wastes produced and collected at least once every 6 mths to the Regional Mayor/ Head, 2nd Level. Evidence about the company decision to increase minimum wage for year 2010 from Human Re-sources Medan Head Offcie according to regulation from West Sumatera Provice. The company’s license for palm oil mill effluent (POME) land application approval i.e. ‘Izin Land Ap-likasi’, Bupati Agam No. 324 Tahun 2009, 17-3-2009 is still applicable & valid. Supporting attachments to the approval were verified (Liabilities & Prohibition of Activities Responsible for Waste Water Pro-cessing Factory Utilization of Palm Oil Palm Plantation Land at PT AMP Plantations) & the following key conditions are noted by the auditor: a) BOD not exceeding 5000mg/litre, pH within 6 - 9 b) Applied to block 5B-5C, 6B-6C, 7A-7C, 8A-8C, 11A-11D at Kec Palembayan Kab. Agan c) Monitoring for the waste water released from the anaerobic / 6th pond (last pond prior to release of WW to land application) for debit (daily) & monthly (BOD / COD / pH / oil / fat / Pb / Cu / Cd / Zn). Re-port submitted to Regent governor, Minister of Environment every month d) Monitoring of soil water at monitoring wells at land application - land control block 8B & sumur penduduk - parameter & frequency as follows: Every 6 mths - BOD / DO / pH / NO3 as N / NH3-N / Cd / Cu / Pb / Zn / Cl / SO4-2. Report submitted to Regent governor, Minister of Environment every 6 months Some evidence regarding the company’s effort to fulfill government regulations related to safety and health issues such as: a. Overhead Traveling Crane license No. 022/W3/VI-CN/1997 from Departement of Man Power dated February 3, 1997. Surveillance checking will be conducted 2 yearly afetr first checking last checking on March 25, 2010. b. Overhead Traveling Crane license No. 023/W3/VI-CN/1997 dated February 3, 1997 last surveillance on March 25, 2010. c. Overhead Traveling Crane license No. 043/W3/F4-CN/2000 dated September 15, 2000 last surveil-lance on March 25, 2010. Evidence of efforts made to comply with changes in the regulations was checked through the latest le-gal register updated on May 2011 & confirmed that latest applicable legal requirements as described above have been updated. The latest legal register is also sighted to be available at the respective plantation offices e.g. at PT AMP II. Compliance status: Full Compliance

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

Findings: PT AMP mill is located outside PT AMP Plantation, company has land use right called “Hak Guna Bangunan- HGB” (Building Use Right) certificate. There are 4 (four) HGB certificates for PT AMP mill, i.e.: 1st HGB certificate in Tepian Kandis village according decree letter no. 550.2-173/HGB/BPN-1995

from Regional Office Head of the Land National Department of the West Sumatera Province dated October 30, 1995 valid until November 13, 2025 in Tepian Kandis village.

2nd HGB Certificate no. 09/SK/HGB/BPN/A/1996 Tepian Kandis village, according to decision from Local Officer National Land Agency (Badan Pertanahan Nasional) West Sumatera Province , is-sued dated September 02, 1996, valid from September 05, 1996 to September 4, 2026.

3rd HGB Certificate for Tepian Kandis village according decree Tepian Kandis village according to Head of BPN decree letter no. 08/SK/ HGB/BPN/A/1996 dated September 04, 1996 valid until Sep-tember 04, 2026.

4th HGB certificate for Tepian Kandis village according to Head of BPN decree letter no. 10/SK/ HGB/BPN/A/1996, dated September 03, 1996 valid until September 05, 2026.

PT AMP Mill was built according to construction permit (‘Izin Mendirikan Bangunan’ - IMB) from Agam



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Regent No. 125/IMB/BA/1994 dated December 22, 1994, IMB no. 27/IMB/BA/1997 for housing and of-fice IMB and no. 52/IMB/2002 from Agam Regent. PT AMP Plantation with total area 9226.42ha (Tompe,Tepian Kandis, Tompe Tepian Kandis, Bawan) has several HGU such as:: 1.SK HGU Nomor 102/HGU/BPN/1997 with total area 2,674 from National Land Agency (BPN) decree letter. Consist of two HGU certificates i.e.

- no. 10 with area 1,340 ha valid from October 29, 1997 to October 29, 2027 - no. 09 with area 1,334 ha valid from October 29, 1997 to October 29, 2027

3. SK HGU nomor 29/HGU/BPN/1999/A/21 from National Land Agency (BPN) decree letter , issued HGU certificate:

- no. 12 with area 714 ha valid from March 31, 2004 to March 31, 2034 - no. 11 with area 4,360 ha valid from March 31, 2004 to March 31, 2034

4. SK HGU Nomor 14-540.1-23-2004 with area 178.42 ha, i.e. certificate no. 01 valid from September 1, 2004 to September 1, 2029.

5. SK HGU Nomor 13/HGU/BPN/2000 with total area 1,300 ha, HGU certificate no. 15. valid from August 23, 2000 until August 25, 2030.

The company has a Forest Release Permit as follows: 1. Forestry Release permit from Ministry of Forestry and trade No. 462/KPts-II/1998, Forestry release permits B for Masang Kanan and Msang Kiri with total area 765 ha in Agam District. 2. Forestry Release permits from Ministry of Forestry and trade No. 34/Kpts-II/1998 Forestry release permit B for Masang Kanan and Msang Kiri with total area 4300 ha in Agam District. 3. Forestry Release permits from Ministry of Forestry and trade No. No. 654/KPTS-II/1995 Forestry re-lease permits B for Masang Kanan and Msang Kiri with total area 4774 ha in Agam District. The company has a recommendation letter No. 593/693/TAPEM 1007 from Pasaman regent regarding forestry status of PT AMP Plantation in Kinali for total of 1300 ha to be included in the category of ’Land for Other Purposes’ (‘Areal Pengunaan Lain’ - APL) for area 2500 ha in Kinali. PT PMJ Plantation has Land Use Right with certificate No. 1 Koto IV village with area 1940 ha valid un-til 25 February 2033. According to decree letter No. 525/1571-Perek-1996 dated June 20, 1096 from Regent of Pasaman Barat for area 7550 ha, this area belonging to PT PMJ is the status of Conversion Production Forest (‘Hutan Produksi Konversi’). Some legal boundaries are clearly demarcated and visibly maintained on the ground. However, during the main assessment, legal boundaries shown on HGU certificate no.9 were found to differ from the ac-tual ground boundaries from Block 4 to Block 9. In fact, planting has encroached into the riparian zones of Masang Kanan River in Blocks 4A&B. Some boundary stones in plasma areas which were in-cluded in the company’s HGU were not well maintained, such as, boundary stone no. 10 in PMJ, 18 & VII PT AMP3 and 15 in PT AMP4 (this sentence is repeated in the report). This was raised as a non-conformity. There are some identified land problems occurring within the area of PT AMP and PMJ plantation such as: 1. Internal land problem between KUD Dastra and Majosadeo family (not land conflict with the com-

pany) 2. Land problem among Simpang Tiga Koto Baru communities (not involving the company). There is a letter from Suparmin Malik, head of farmers group Harapan II Simpang Tigo Koto Baru vil-lage, Pasaman District dated January 10, 2011 stated that Plasma KUD Dastra in PMJ area and part of the company owned estate area is customary land of Simpang Tiga Koto Baru communities. Actually, the conflict is not a conflict between the company and local community. It is more of an internal conflict among the communities which is beyond the company’s responsibility. However, since it is in the com-pany’s area, PMJ management has an interest over the issue. 3. Conflict between Koto Baru village’s community and PT PMJ regarding:

- Boundary of PT PMJ area and community’s land in sub block M1, M2, and M3 - Existence of farmer group in sub block M3 - Safety for PT PMJ planted area.



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In order to resolve the conflict the community and PT PMJ has held a meeting on April 27,2011 and came into an agreement as follows:

- The group of farmer asked PT PMJ to do no planting activities in sub block M1, M2, M3 and block 4A.

- The both will not carry out harvesting activity in sub block M1, M2, M3 - The farmer group members in sub block M3 could stay in their area. - When there is a new agreement in the future the farmers in sub block M3 will move in to block

10 B areas under PT PMJ’s cost responsibility. The compensation fee already given by PT PMJ to the farmers wills payback to PT PMJ when there is a new agreement established someday in the next meeting.

4. Land problem between Rustam Silalahi and PT PMJ The conflict resolution is as follows. There are notes of Rustam Silalahi’s arable land acquisition in the core of HGU area PT PMJ, dated 3 November 2010 with area of 1.26 ha in block 3B. There is agree-ment to provide land acquisition compensation of Rp. 1.89 million. There is a receipt dated 3 November 2010 as proof of payment to Rustam Silalahi Rp. 1.89 million for land acquisition area of 1.26 ha in block 3 B of PT PMJ. 5. Internal conflict in village cooperative units (KUD/Koperasi Unit Desa) Damai Sejahtera I and KUD Damai Sejahtera II regarding smalholder scheme area (plasma area). There as meeting minutes about conflict resolution process and planning for conflict resolution activities using mediator from third par-ties. There are some evidence of land acquisition through free prior and informed consent for some land aquisition such as : 1. Handover of Kinali customary land to the company dated April 9, 1993, by 9 customary leaders

people (in Padang called Ninik Mamak and orang tua adat), customary judges, clergy (M Dt. majo indo, M. Dt Hitam putih, M. Dt Rangkayo basa, H. S Dt Simarajo, AB. Mangkuto alam, B. Dt Bando-basa, Ilyas majosadeo, A. Dt Majokayo, H.M Syeh Mudo ). There is evidence of compensation pay-ment (in Padang called siliah jariah) for 1300Ha of Rp. 6.3 million on 28 January 1995.

2. Handover of customary land in Manggopoh Village, dated March 1, 1994, by D. Dt Talut Api, AR Dt Gantosuaro, A. Dt Majosati, SY Dt Bintaro rajo, Y Dt Talut Api, Sutan Nurut, J Dt Bintaro

3. Handover of customary land in Tapian Kandis village dated April 7, 1993 by, Dt Bandaro, Meumar Dt Kayo, Sidik Dt J Loanso, Husin Dt Tan PAhlawan, with amount Rp. 9 juta for 300 ha land area dated May 23, 1995.

4. Handover of customary land in Tepian kandis village dated April 7, 1993 by customary leader Tompek, with compensation amount Rp. 27 million for area 900 ha,dated April 7, 1995.

Compliance status: Non Compliance NCR No. 2011-01 of 13 1. Legal boundaries shown on HGU certificate no.9 were found to differ from the actual ground bounda-ries from Block 4 to Block 9. In the field, planting has encroached into the riparian zones of Masang Kanan River in Blocks 4A&B.

2. Some boundary stone in smallholder area which is included in company’s HGU are not well main-tained, such as boundary stone no. 10 in PT PMJ, 18 & VII PT AMP 3 and 15 in PT AMP4.

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

Findings: There are some records of any negotiated agreements between traditional owners of land and planta-tion companies which is supplemented with maps in appropriate scale, such as for land problem in IV Koto village and Mandiangin village, Kinali sub district Pasaman District (Before changed to West Pasaman District), there is agreement with customary leader regarding submission of communal land in IV Koto village and Mandiangin village for oil palm plantation development by PT Primatama Mulya Jaya (PT PMJ), dated June 6, 1996. Submission made by customary leader (ninik mamak). Some sample of negotiation also found for all land compensation as explained on criteria 2.2 above. There is a map of the traditional activities of the community in the area of PT PMJ and PT AMP which includes activities such as fern location which is consumed as vegetable by local communities, fishing



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location, and location of grazing in company’s owned estate and smallholders area of KUD Dastra I. There is a map of the location of cattle grazing area agreed with the communities within the concession area and PT AMP and PT PMJ. Copies of negotiated agreements detailing process of consent are available on Bina Mitra office such as: A copy of the land transfer agreement by customary leaders (‘ninik mamak’) to the government in-cludes information of the rights and obligations which are binding on both parties PT AMP and ninik mamak (Customary leader). Sample copy of contract documents are as follows: a. Contract between PT AMP plantation with Customary Leader in Katiagan village,Kinali sub district, Pasaman District regarding customary land in area Katiagan village, Nagari Katiagan Kinali, Pasaman sub district for oil palm plantation PT AMP Plantation dated August 24, 1995 for total area 1200 ha signed by Regent head Pasaman District and customary leader, Katiagan. b. Customary land transfer by Bawan village, Representative of Lubuk Basung sub District, Agam Dis-trict to oil palm plantation PT AMP Plantation dated August 25, 1991 signed by Head of District (Bupati) Agam and customary leader of Bawan. c. There is MOU/agreement notes for traditional right management and management of HCV area be-tween PT AMP IV/PMJ with Kinali community dated May 27, 2011 signed by PT PMJ and Customary leader “Wali Nagari” Kinali with Mou for grazing activities in area HGU PT AMP and PT PMJ with loca-tion map for local community from Nagari Kinali, Nagari Salareh Ayia, dan Nagari Tiku, dated July 8, 2011. Compliance status: Full compliance

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

Findings: The company has a long term management plan for a 5 years period i.e. projection for 2011 to 2015 with information on this document consisting of company activities such as profit and loss information from Total Revenue and Total Operating Cost, including information about gross operating cost, prof-it/loss before tax and profit and loss after tax. The company has a financial schedule for yearly budget. Information on document consist of general routine operational activities such as plantation mainte-nance, harvesting, fertilizer, investment plans such as enrichment planting (planting of various plant species to enhance biodiversity), mill activities such as FFB processed, projected oil extraction rate (OER) and kernel extraction rate (KER), projected crude palm oil (CPO) and palm kernel (PK) produc-tion, CSR programmes and environmental monitoring, HCV management plan and other activities to fulfil RSPO requirements. The company has also developed a medium term plan for a 5-year period (2010-2015), containing information on the budget for each activity (including activities for environmen-tal management programmes and all CSR related expenses, legal compliance and RSPO P & C com-pliance) and revenue from company's production including all company's liabilities. The amount of profit estimated to be achieved each year was clearly calculated, and all information is clearly explained in PT AMP’s projection plan for a period of 5 years from 2011 to 2015. In a cash flow projection document, there is also a plan for 5-year cash inflow from the sale of FFB to another factory because of the surplus of FFB on all 3 estates, sales of CPO and palm kernel sales. The main points of cash outflow is the overall production cost of the estate and the mill include the cost of estate maintenance (susnainability cost), as well as the combination of costs associated with envi-ronmental and social monitoring activities. Year 2010 was the first year in which the company earned profit because the past years were use for investment and maintainance. Documentation of cost projection for estates and mill are integrated, and the projected financial feasibility of company for next 5 years based from the current FFB price can be seen from these documents. The company implements a replanting cycle every 25 years, and company’s plan for a replanting activi-ties will begin in next 5 years, the first replanting program will begin in 2015 for AMP I for an area of 513.98 ha and year 2016 for an area of 206.34. Replanting activities for AMP2 is yet to be planned while for AMP 3, 4 and PT PMJ, the estates consist of young palms and no replanting is planned for at least 15 years more.



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Compliance status: Full Compliance

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

Findings: The Standard Operating Procedures (SOPs) for estate activities are available. The SOP covers all es-tate activities such as pre-development and planning, nursery practices, land clearing and preparation, establishment and maintenance of leguminous cover crops, oil palm planting density and pattern, and maintenance, harvesting, pest and disease management, replanting, and mulching. SOPs or procedures that available, such as: 1. Nursery PRO-EST-001, dated 2 May 2011 rev.02 2. Land Clearing Without Fuel, PRO-EST-002, dated 2 May 2011 rev.02 3. Planting PRO-EST-003, dated 2 May 2011 rev.02 4. Estate management PRO-EST-004, rev.01 1 September 2008, including fertilizing, spraying circle path, selective weeding, pruning and sanitation, pest and diseases control, control of weeds 5. Harvesting PRO-EST-005, rev.03 dated February 1, 2009, the harvest intervals stipulated 8-10 days, a census of black fruit (black Bunch) 4 months (January to April, May to August, Sept-Dec), data on FFB collected is recorded on forms no. OPH1 then the data will be transferred to forms no: OPH2, OPH3 and OPH4. 6. Manuring, SOP-EST-001 rev.01 dated 01 Sept 2008, labor standards need fertilizer, the dosage is 50-100 g / pk = 0.25 HK / ha, 100-500 g / pk was 0.30 HK / Ha , 500-1000 gr / pk is 0.35 HK / ha, and from 1000 to 2000 gr / pk is 0.4 HK / Ha 7. Circle and Path Spraying, SOP-EST-002 rev.01 dated 01 Sept 2008. Path Spraying max 4x year, Circle spray max 4 x year, Selective / Spot spray 3 times a year max. 8. Selective Weeding SOP-EST-003 rev.01 dated 01 Sept 2008, carried out 2 times a year. 9. Prunning, SOP-EST-004 rev.01 dated 01 Sept 2008, carried out 2 times a year 10. Diseases and Pest Control, SOP-EST-005 revision 01 April 19, 2007, 11. Control weeds, SOP-EST-006 rev.01 dated 01 Sept 2008, conducted as needed. 12. Roads and bridges, PRO-INF-002 rev.00 dated February 15, 2007, is done manually and mechani-cally and performed as needed and the weight of the work (REED-EST-001) 13. SOP-EST-007 dated 02 May 2011 rev.01 regarding harvesting at dangerous areas specifically har-vesting under electricity cables, slope areas and slanted trees SOP of the mill is available such as: 1. Sorting, SOP-Mill-002 Revision 01 dated October 15, 2008 which informed the appropriate quality for the quality of FFB and FFB action if quality is not in accordance with the requirements of the essence both for FFB, and the Local Group (3rd party). 2. Loading PT AMP, Mill-003 SOP-00 revised April 19, 2007. 3. Sterilizer SOP-Mill-004 Revision 02 dated February 5, 2009 peak pressure boiling determined where the peak-1 at 1.2 kg/cm2, the peak-2 at 2.0 kg/cm2, peak-to-3 on 2.7 kg/cm2. 4. Capstan Mill SOP-005-00 revised April 19, 2007 5. Threshing Mill SOP-006-00 revised April 19, 2007, the establishment of Ampere Thresher at the time of the process is between 20-30 A. 6. Mill Press-SOP-007 revision 01 dated January 5, 2008, which established the digester temperature during the process between 90-95 °Celsius. Hydraulic pressure between 80 -90 Kg / cm square. Am-pere Screw 40-50 A. 7. Clarification SOP-Mill-008 Revision 01 dated February 5, 2009. Make sure hot water has been filled with water at temperatures greater than 90°C, make sure there is oil in the wet oil tank at a temperature of 70-80°C. during the process make sure the oil temperature between 70-80°C. This procedure covers the handling of the Crude Oil Tank (COT) COT where the temperature is maintained at 90-95°C. Con-tinuous clarifier tanks (CCT) with a conditioned temperature 90-95°C. Oil Tank Sludge and sludge tanks where conditions of temperature greater than 90°C. Minimum of six months washing tank. And the process Brush strainers to filter impurities. 8. SOP-Mill kernel revision 00-009 dated April 19, 2007 include procedures for Polishing Drum Nut and nut to separate the dirt, Clay Bath to ensure perfect core and shell separately, Conveyor to ensure proper distribution of nuclei with, Ripple Mill for solving Nut 9 Kernel Crushing Plant Mill-013 SOP-00 revised April 19, 2007, the core process procedures into



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Palm kernel oil (PKO). 10. Storage CPO / PKO PRO-Mill-003 Revision 01 dated July 17, 2007, CPO was conditioned at a temperature of 50-55 degree. Free fatty acids (FFA) max 5.0%, 0.02% max levels of impurities, water content max 0.2%. For palm kernel oil (PKO) temperature 50-55 degree C, 4% FFA, 0.02% levels of impurities and moisture content of 0.2%. 11. Acceptance of TBS PRO-Mill-001 Revision 02 dated November 6, 2007 12. Delivery CPO / PKO-004 PRO-Mill revision 01 dated July 17, 2007. It was found FFB sorting Procedure SOP-Mill-002 Revision 01 dated October 15, 2008 no longer rep-resents the sorting method that is being used at the mill where the calculation of FFB with the criterion of sorting through the raw fruit is not the same as the procedure’s criteria which to use fraction 00, and the fraction 0, and this was raised as potential for improvement. The company conducts monitoring for all applicable SOPs at least twice a year with reference to the In-ternal Audit procedure PRO-GEN-003,rev.01 dated 1 May 2011, as defined on internal audit schedule recorded on REK-GEN-008 rev.01 which are planned in June and Dec. 2011, including the palm oil mill, PT AMP 1, PT AMP 2, PT AMP 3, PT AMP 4 and PMJ internal audit includes monitoring and in-spections related to the Quality, Environment and the RSPO. The actual dates of when internal audit was conducted is as follows: PT AMP1 dated July 5, 2011, PT AMP 2 dated July 7, 2011, PT AMP 3 dated July 6, 2011, PT AMP 4 and PT PMJ dated July 9, 2011 and palm oil mill dated July 8, 2011. Records of operational results are well maintained in each estate and mill. Example that were checked include, 1. Sorting reports using the weigh bridge form and differentiated between local fruit, company-owned and smallholders (‘plasma’), eg for incoming FFB as stated below: -> No Reference E20110700892 date of 05/07/2011 -> No Reference E20110700875 dated 05/07/2011 2. Records of Sterilizer time using the form FRM-Mil-05 rev.01 dated February 12, 2008 Compliance status: Compliance with Observations

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

Findings: Leaf nutrient analysis is conducted annually and fertilizer recommendations report for each respective estate are prepared based on analysis results, while visual analysis results are documented for each estate. At PT AMP II, leaf analysis is conducted by an external laboratory on yearly basis. The latest analysis was conducted on May 2010, however the report has not been received yet. Report for year 2010 (July 2010) was sighted. Each annual report includes a summary of findings and recommenda-tions. For exsample, From the 2010 report for KSI 1, it was noted that overall nutritional status in PT AMP1 has improved in the past year, except for many suboptimal levels of nitrogen (N). A detailed soil analysis was conducted for all PT AMP Plantation and PT PMJ estates by Param Agri-cultural Soil Surveys Sdn. Bhd. in June 2007. The report includes a soil survey, where 13 soil series were mapped, consisting of well-drained soils (Tebok, Rasau, Kechor, and Nangka series), imperfectly drained soils (Gong Chenak, Bukit Tuku, and Banar series), poorly drained soils (Kampong Pusu, Cherang Hangus, and Lunas series) and peat soils (Galy series). The Bungor and Banar soil series were sampled for soil analysis and the soil samples were found to generally be of low fertility. The company prepares reports on implementation of their environmental management and monitoring plan (RKL & RPL) to the government every 6 months as required by law. All estates maintain soil fertility through fertilizer applications as well as land application of EFB. The estate has a system to monitor whether actual fertilizer applications meet recommended fertilizer appli-cations. It was noted for PT AMP 3 that actual applications are done in accordance with recommenda-tions for 2010. Compliance status: Full Compliance



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

Findings: The company has a detailed soil map showing gradients and all soil types within all estates conducted by Param Agricultural Soil Survey(M) SDN. BHD, last soil survey was conducted on May 2008. Accord-ing to soil survey result there are found some soil type in PT AMP and PT PMJ plantation i.e. 1. PT AMP 1 i.e. Cambisol gleick, Nitosol District, Podsolic District, Aluvial District, Cambisol District, 2.PT AMP 2 i.e. Alluvial Distrik, Cambisol Gleick, Podsolic Gleick, Cambisol District, Hemic Organosol 3.PT AMP 3 i.e. Hemic Organosol 4. PT AMP 4, i.e. (Hemic Organosol dan Regosol Quarzite) While for PT PMJ the soil type according to soil classification from the Soil Research Centre for year 1993 are, Hemic Organosol (97.9% or 1226.85 ha) and Regosol Quarzite (2.1 % or 26.54). Fragile soil in PT AMP and PT PMJ include peat soils. Most of soil type in PT PT AMP plantation and PT PMJ is peat soil which has a variety of peat depth. According to a peat soil survey conducted in 2010, total peat soil area in PT AMP 2 is 1086.37 ha, in PT AMP 3 is 1,792 ha, PT AMP 4 is 163.72 ha and PMJ is 1118.95 ha, while fragile soil in PT AMP 1 is land with high erosion risk because some plantation area nearby the river escarpment which has high erosion level such as block 9, 5, 4, and 3 are beside river Batang Anggang. The company has identified all streams that flow inside of estate ar-ea and created a riparian buffer zone management programme. There are 3 large rivers in the area of PT AMP plantation, i.e. Masang Kanan, Masang Kiri and Batang Anggang, the width of the rivers range from 10 to 100 meters. In PT PMJ there is a river called Menamang Kanan river. PT AMP Plantation and PT PMJ has a plan for protection of river riparian buffer zones along natural streams through felling of oil palm trees adjacent to these natural streams and replanting the buffer zone areas with hardwod tree and leguminous cover crops (LCC), as well as building of stone dam at canals flowing into rivers, in order increase the retention time of canal water potentially contaminated with chemicals or surface run-off into main streams. Some part of plantation area found nearby the river escarpment which has high erosion level such as block 9, 5, 4, and 3 are beside river Batang Anggang. The company puts waterblocks from stone to prevent river sedimentation in the river and protect the river from open soil activities. However during audit it was found collecting road in block 4A&B PT AMP 1 was constructed in the high risk erosion land, this is raised as non conformities, because this road can be a potential to increase erosion levels and may result in landslides. The company’s no-chemical-application-only strategy for the protection of fragile soil, such as on the escarpment land in the riparian of Masang Kanan river in Blocks 4A&4B of PT AMP 1 is considered insufficient since this area is categorized as being susceptible to high risk of erosion/abrasion. As seen from the company’s topographic map, most areas of PT AMP1 are undulating and the hilly section nearby the river has a slope of more than 10% which is still suitable for planting. The company has a management strategy for plantings on slopes above a certain limit, such as terracing, as referred to Agriculture Manual and SOP for Oil Palm year 2008, as well as SOPs for the ‘horse-shoe’ method, terracing method and silt pits. PT AMP and PT PMJ plantation has road maintenance program as determined on PRO-INF-002, which includes the budget for road maintenance activities for each estate, and records of actual road maintenance activities conducted such as graveling, road service, and re-surfacing. The Assistant Road Superintendant is responsible for ensuring road maintenance activities are carried out according to plan. Records of actual road maintenance activities conducted showed that maintenance is regularly carried out according to plan and actual costs were above the planned budget. Up until June 2011, 59.500 km of road has been maintained. The road condition was observed to be quite good. The company makes efforts to minimize subsidence of peat soils under an effective and documented water management programme. The company has marked observation points in all estate which has peat soil to monitor the subsidence of peat soil within company’s area, where the largest area of peat is located in PT AMP 3 and PT PMJ. Total 12 observation points have been installed in all company’s es-tate in 2011. Since the observation point is new, the result of monitoring of peat soil subsidence still not be identified. According to monitoring program, company has periodic peat soil subsidence monitoring every 6 months,



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As a mechanism to prevent decline of water level in the peat, weirs were installed at strategic points to trap and maintain water in the estate canals at a certain level. Water levels are monitored on a daily basis in order to ensure that the water table is maintained at around 35 cm from the ground surface (using measuring instrument), although this level is less than the standard set by the company at 70cm. However, asides from peat subsidence and a decrease in water level, PT AMP has not measured other parameters of the peat soil area as required by Government Regulation No. 150, 2000 which states a requirement that the pH, pyrite content, electrical conductivity and other chemical parameters of the peat are also monitored. This is a potential for improvement, and will be checked during next audit. Compliance status: Non Compliance NCR No. 2011-02 of 13; The company’s no-chemical-application-only strategy for the protection of fragile soil, such as on the escarpment land in the riparian of Masang Kanan river in Blocks 4A&4B of PT AMP 1 is considered in-sufficient since this area is categorized as being susceptible to high risk of erosion/abrasion. NCR No. 2011-03 of 13; An FFB collection road in Blocks 4A&B of PT AMP1 was found to have been constructed over areas with high erosion risk.

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

Findings: The company has identified all streams that flow inside of estate area and created a riparian buffer zone management programme. There are 3 large rivers in the area of PT AMP plantation, i.e. Masang Kanan, Masang Kiri and Batang Anggang, width of rivers ranges from 10 to 100 meters. In PT PMJ there is a river called Menamang Kanan river. PT AMP Plantation and PT PMJ has a plan for protection of river riparian buffer zones along natural streams through felling of oil palm trees adjacent to these natural streams and replanting the buffer zone areas with hardwood trees and leguminous cover crops (LCC) such as at Batang Anggang river riparian buffer zone, as well as building of stone dam at canals flowing into Masang Kanan rivers, in order increase the retention time of canal water potentially con-taminated with chemicals or surface run-off into main streams. Some parts of the plan has been im-plemented as some plantings of hardwood trees and leguminous cover crops in certain area nearby Batang Anggang river have been carried out, but the implementation of the plan will continue to be car-ried out until next year in accordance with the company’s new budget. Implementation of the plan will be observed during next surveillance audit. The company also made an SOP for protection of riparian buffer zones of watercourses and wetlands, including maintaining and restoring appropriate riparian buffer zones, prohibition of agrochemical application activities nearby rivers or watercourses. An implemented water management plan can be seen. The company has developed and implemented a documented water management plan. For supplying water at the housing area, company has plans to develop water treatment and facilities at PT AMP 3, 4 and PMJ and well groundwater at PT AMP 1 and 2. Treated waste water is discharged for land application, from pond no. 5, sighted during on site visit. Noted according to the Environmental, Health and Safety (EHS) Supervisor, currently the treated waste water is 100% released for land application. Noted the nearest river to the mill is Sg Batang Anggang. Sighted the following latest external lab test reports (tested by Laboratory For Research and Standardi-zation of Industrial Institution (i.e. "Balai Riset Dan Standardisasi Industri Padang"). The lab used for the test are confirmed to be accreditated by the National Accreditation Committee or KAN (Komite Akredatasi Nasional): Sighted latest lab test report for Sg Batang Angang Atas & Bawah in the month of May 2010 & Novem-ber 2010. Results comply with Government requlation (Peraturan Pemerintah) no. 82 year 2001 class II except for May 2010 where the total suspended solid exceeds the specification. Justifications were available, explained by the consultant in the monitoring report (RKL / RPL Semester I 2010) & are ac-cepted by the audit team.



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Currently no monitoring of residential monitoring wells for PT AMP II. For PMJ, only 1 sample was tak-en from the newly completed housing area (Block 20). It has been noted that the programme to provide clean water is in place & implementation is in progress Old contaminated wells At PT PMJ, Block 14 have been closed up & new properly structured wells have been erected at the dedicated area behind the housing blocks. Proper fence covers are provided & covered each of the well to prevent fall risks to the little childrens living nearby the housing blocks. As the water sources from the well are not fit for human consumption, the water is only used by the em-ployees & families for bathing & washing clothes. Clean water is purchased externally for drinking pur-pose. Water tanks will be provided to each of the household for collection of rain water & to provide cleaner source of water. Proper bins are provided for each home, waste bins are labelled clearly ac-cording to waste types disposed such as hazardous waste bin, organic & inorganic bins. Sighted doc-umented management plan for providing cleaner source of well water for use. During interview with the chemical sprayers, they have informed that a proper place for personal pro-tective equipment (PPE) washing, shower facilities etc have been provided for their use, located near the warehouse of PMJ main office. The washing area was visited & found to be adequate to address the proper handling & washing of PPE & cleaning purpose by the chemical sprayers Monitoring of effluent BOD, Monthly waste water test reports are available & sighted during the on site visit. Results achieved are found to be within the limits specified. Tests are conducted by Laboratory for Research & Standardisation of Industrial Institution (‘Balai Riset Dan Standardasi Industri Padang’). Sighted lab test reports starting from Jan 2010 till May 2011 (monthly report for 8 test parameters) & found both BOD & pH (only 2 parameters with specification limit requirements) meets the specification requirements. According to the ‘Izin Land Aplikasi’, Bupati Agam No. 324 Tahun 2009 (Land Application Approval), 17-3-2009, the supporting attachments to the approval (‘Kewajiban & Larangan Bagi Penanggung Jawab Kegiatan Pemanfaatan Air Limbah Pabrik Pengolahan Kelapa Sawit Pada Lahan Perkebunan Kelapa Sawit PT AMP Plantation’) - Monitoring of soil water at sumur pantau (control well) at land application - land control block 8B & ‘sumur penduduk’ (public well) - parameter & frequency as follows: Every 6 months - BOD / Dissolved oxygen/ pH / NO3 as N / NH3-N / Cd / Cu / Pb / Zn / Cl / SO4-2. Report to be submitted to ‘Bupati gubernur, Menteri Negara Lingkungan Hidup’ (Governor, Ministry of Environment) every 6 month. However, at the time of audit, there is no latest test report available (supposedly due on April 2011). It was conducted on June 2011 & the report is still pending. From cross checks of the actual daily journal for mill effluent land application, it was found on 8-5-11, 2-5-211, and other dates that there ware effluent application at block 6A was applied; however this block is not included in the list of approved blocks for land application as per Izin Land Aplikasi, Bupati Agam No. 324 Tahun 2009, 17-3-2009. The piping connecting the waste water for land application to block 6A has been disconnected & the activity of land application to this block has been stopped indefinitely. However, the objective evidence of root cause & corrective actions determination are not available to prevent recurrence.

The monitoring records of mill water use per tonne of FFB for years 2009 & 2010 were sighted. The usage ranged from 0.69-1.16 tonnes water / tonne FFB processed and 0.06-0.17 tonnes water / tonne FFB for domestic usage (this was raised as an observation that the unit used is appropriate for domes-tic usage). Compliance status: Non Compliance NCR No. 2011-04 of 13 According to the the company’s license of land application of mill effluent issued against regulation, Bu-pati Agam No. 324 Tahun 2009 (regarding Land Application Approval) dated 17-3-2009, the supporting attachments to the approval (‘Kewajiban & Larangan Bagi Penanggung Jawab Kegiatan Pemanfaatan Air Limbah Pabrik Pengolahan Kelapa Sawit Pada Lahan Perkebunan Kelapa Sawit PT AMP Planta-tions’), monitoring of soil water at sumur pantau (control well) at land application - land control block 8B & sumur penduduk (public well) is required to be carried out once every 6 months and parameters for the following: BOD / DO / pH / NO3 as N / NH3-N / Cd / Cu / Pb / Zn / Cl / SO4-2. The report is to be submitted to ‘Bupati gubernur, Menteri Negara Lingkungan Hidup’ (Governor, Ministry of Environment). However, at the time of audit, there is no latest test report available (supposedly due on April 2011). It was conducted on June 2011 & the report is still pending. NCR No. 2011-05 of 13



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From cross checks of the actual daily journal for mill effluent land application, it was found on 8-5-11, 2-5-211, and other dates that there ware effluent application at block 6A was applied; however this block is not included in the list of approved blocks for land application as per Izin Land Aplikasi, Bupati Agam No. 324 Tahun 2009, 17-3-2009. The piping connecting the waste water for land application to block 6A has been disconnected & the activity of land application to this block has been stopped indefinitely. However, the objective evidence of root cause & corrective actions determination are not available to prevent recurrence.

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

Findings: The company has developed an SOP for Integrated Pest Management (IPM) and SOP for detection and pest census of oil palm trees diseases, PRO-EST-007 Rev 00, 1-1-2010). The company’s IPM is conducted as follows: - Chemical control is only conducted in cases of major pest outbreaks; - Biological control is through viral infection of the pest itself; - Manual control through hand picking, - Cultural control using host plant (‘tanaman inang’) i.e. planting of beneficial plants (e.g. Turnera su-

bulata) to attract natural predators of leaf pests, and this plan was well implemented during field checks at both estates.

Plantings of Turnera subulata were observed throughout the estates roads; To monitor levels of pest infestations, company conducted census on a sampled area as an early warning system. A full census will be conducted if pest attack levels of up to 20% are detected in the sampling area. Pest monitoring/detection and IPM activities commenced in September for year 2010. Monitoring is planned to be conducted for all blocks in the estate. The most common pests found include bagworms (mahesa corbetti) and termites. IPM training was conducted e.g. for all estate supervisor for PT AMP 1, II, III and IV and PMJ and pest conductor. Training materials included information on types of pests, chemical control, biological con-trol, cultural control and physical control methods. The company monitors and records pesticide usage in 2010. In year 2010, records show that the use of pesticides is little e.g. up to October 2010, Klerat (rat bait with a.i. brodifacoum 0.075%) was used and application was only 0.000005 g of a.i. per tonne FFB or 0.00008 g of a.i. per ha. This amount was very small. Compliance status: Full Compliance

Criterion 4.6: Agrochemicals are used in a way that does not endanger health or the environ-ment. There is no prophylactic use of pesticides, except in specific situations identified in na-tional Best Practice guidelines. Where agrochemicals are used that are categorised as World Health Organisation Type 1A or 1B, or are listed by the Stockholm or Rotterdam Conventions, growers are actively seeking to identify alternatives, and this is documented.

Findings: The company only use approved and registered agrochemicals permitted by the relevant authorities, as seen on the records of chemicals used during the year 2010, including the following: -> Gramoxone (Paraquat dichloride 276 g / l) was used for broadleaf weeds, woody growths, seed-lings, ferns, only used until the month of October 2010 -> Glisat 480 EC (Isopropylamina glyphosate 480 g / l) was used for grasses -> Trap 20 WP (metsulfuron methyl 20%) mixed with Gramoxone to treat grasses -> Furudan -> Regent -> Agristik -> Decis (deltamethrin 25 g / l) was used for control of nettle caterpillars or leaf-eating pests. Chemicals used during the year 2011:



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-> Glisat 480 EC (Isopropylamina glyphosate 480 g / l) was used for grasses and weeds. -> Trap 20 WP (Metsulfuron methyl 20%), only used until April 2011 -> Decis (deltamethrin 25 g / l) was used for control of nettle caterpillars or leaf-eating pests. -> Bayfolan -> for nursery -> Kenlon 480 EC (Trichlophr butoksy ethyl ester 480 g / l) used for woody growths -> Petrokum, rat poison -> Starmin, 2.4 Dimethyl amine for broad-leaved Weeds -> Winson (Metsulfuron Methyl 20%) as re-

placement for Trap 20 WP The use of pesticides is documented in an annual program, active ingredient used can be seen from a list of chemicals used, applied area, the amount of chemical used per hectare, as well as the frequen-cy of chemical application is documented in an annual spraying program including information on types of spraying i.e. circle spraying, Path Spraying, Selective Spot Spraying. The path and circle planned for 3 (three) times in one year for all the blocks such as Block 1A, 1B, and 1C in PT AMP1. Selective Spot Spraying is planned only one time a year for all blocks in PT AMP1 estate. Records of pesticide use are well documented including the active ingredients used, the applied area and use per hectare and the number of times the application. It can be seen from the work program, e.g. for PT AMP 3 in year 2011 Circle spraying applications, using glisat and Winson it was done 3 times a year for each block, for example, nine blocks covering an area of 96.31 ha (per ha stand 128) the total amount of 12.328 kg. In the year 2010 circle spraying also applied three times as planned. e.g. The use of chemicals in Block 1 In January 2010 an application circle spraying with an area 103.48 ha (SPH 134). The usage of pesticides in PT AMP 4 and PT PMJ for year 2011 are well docu-mented as well. The number of times of chemical application is 3 times a year, for example, block 021 and an area of 100.8 hectares planned circle spraying applications by using chemicals and Winson and Glisat in February, June and November 2011. Likewise was done for path spraying. The usage of agrochemicals is appropriate for the target species, given at correct dosage and applied by trained personnel in accordance with the product label and storage instructions such as: -> Regent 50 SC (Fipronil 50 g / l) -> used for termite extermination -> Petrokum 0.005 RMB (Brodifacoum 0.005%) is used for the extermination of rats -> Gramoxone (Paraquat dichloride 276 g / l) is used for broadleaf weeds, woody growth, oil palm nurs-ling, and fern. -> Trap 20 WP (metsulfuron methyl 20%) is used mixed with Gramoxone and glisat to eradicate weeds -> Kenlon 480 EC (Trichlopir Butoxy ethyl ester 480 g / l) is used for weeds -> Glisat 480 Sl (Isopropillamina lifisat 480 g / l) used for weeds. -> Ken Amin (2, D Dimethylamina 865 g / l) is used for broadleaf weeds such as taro, tuba root. -> Garlon (trichlopir 480 g / l) is used for woody growth -> Dense 520 SC for the Ganoderma -> Dithane M-45 80 WP (Mankozeb 80%) is Fungicide (Fungi Kurkularia, for nursery) -> Decis (deltamethrin 25 g / l) is used for control of nettle caterpillar pests. Dosage of chemicals are applied is still below the recommendations established by supplier on the in-structions of use on product labels, such as glisat dose used in the year 2010 to 2011 is between 1.2 to 2.0 L / ha. Training for all sprayers was conducted in May 2009 by supplier Sygenta where the topics trained in-cluded understanding of the herbicides used, their nature and characteristics as well as first aid treat-ment if accidentally exposed to dangerous level of agro-chemicals. Training records such as attend-ance list and photographs are well maintained at each estate office. Waste materials from agrochemicals including pesticides containers are properly disposed in accord-ance with laws and regulations. In all locations, the packaging wastes of agro-chemicals were collected and kept in the Hazardous Waste warehouse with well maintained records. As the company is yet to find a licensed agent, the accumulated packaging wastes were still unavoidably kept by the company in the waste warehouse as the law forbids their disposal through unlicensed collectors. The chemicals categorised as World Health Organisation Type 1A or 1B, or listed by the Stockholm or Rotterdam Conventions, and paraquat, is no longer used for year 2011. Gramoxone which contains paraquat is used in September 2010 for the last time. As a whole, medical examination for all operators of both fertilizing and spraying is performed periodi-



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cally. Final implementation of checks on 26 to 28 October 2010 was doneby UPTD Balai Hyperkes and Safety Office personnel of West Sumatra. Cholinestrase examination was conducted for fertilizing and spraying operators and all operators associated with the chemicals. Records of examination results are available and documented. The company has policy prohibiting pregnant and breastfeeding women to carry out activities where they come in contact with chemicals, such as for spraying activities. According to interviews result with woman workers as sprayer in block 7 of PT AMP3, it was informed that pregnancy tests were done once in a month by company’s paramedic. Record of pragnacy test is available at the clinic. However, according to test results, it was found one female sprayer at PT PMJ estate was determined to be pregnant on December 2010, but she was still carrying out circle spraying until January 2011. This is raised as a non conformity. Compliance status: Non Compliance NCR No. 2011-06 of 13 It was found that a female sprayer at PT PMJ was determined to be pregnant on December 2010, but she still carried out circle spraying up until January 2011.

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

Findings: Occupational Health and Safety Policy 2010 which was signed by Mr. Goh Ing Sing as Group Head Planttaion and Mr. Jeremy Goon as Group Head of CSR has been reviewed and updated in September In general, the policy contains: 1. Commitment to comply with all laws and regulations applicable to the obligations of occupational health and safety and other requirements to which the group operates. 2. Commitment to implement and maintain a Safety Management System in accordance with the RSPO criteria. 3. Create and communicate to employees and contractors, clients and guests about how safe working and safety regulations a specific work location, and the need to prevent occupational accidents, occu-pational health, hazards, damage and lost of goods. 4. Demonstrate and build awareness through adequate training periodically, exemplary conduct and responsibilities of employees and business partners, including contractors and farmers through their in-volvement in the process of continuous improvement. The company has Safety and health committee (P2K3) as responsible team for OSH activities, this team has been approved by the head of Social and Labor officer Agam Districk through decree letter no. 460/2996/Sosnaker/IX/AG-2009 dated September 7, 2009. It was updated due to changes in per-sonal (membership structure) that is the replacement of Mr. Danir into Mr. Zaharuddin who served as a patrol/monitoring section EHS with letter no. 41/ AMPPOM-MM/Ext-VI/2011 dated June 14, 2011. Due to PT PMJ has different legal entity, PT PMJ has different Safety and health committee (P2K3), as approved by West Pasaman Workforce and Transmigration Officer letter no. 560/01/P2K3/DSTK-TRANS/2011 dated January 03,2011 with the chairman Mr. Rafik Mirza, Vice-chairman Mr. S Damanik, Mr. Secretary. Insanul Zuhri. Special expert for OSH has been assigned i,e, Mr. Insanul Zuhri, SP As approved by Minister of Manpower Decree No. RI TRANS. Kep.2675/M/DJPPK/XII/2010 The Occupational Health & Safety committee’s periodic meetings are conducted in accordance with the safety and health management program at 3-monthly intervals. The meeting was attended by member of committee represent from every department, all person listed on OSH committee organization struc-ture shall attend the meeting as scheduled. Records of regular meetings are documented on Form FRM-GEN-016 rev.01, e.g. February and May 2011. For instance, the meeting held on February 14, 2011 was sighted from meeting agenda record and attendance list FRM-GEN-015. The OSH meeting was attended by safety committee including company’s management’ representative and head of sec-tion including mill EHS officer. Work accident insurance is provided by company to all permanent employees by working with JAMSOSTEK (Social Security of Labour), each workers has Jamsostek card. However for non perma-nent workers company does not provide accident insurance, only full reimbursement if there is an ac-



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cident. Regular health examination performed last date of 26 to 28 October 2010 in accordance with the re-sults of laboratory analysis (Laboratory Test Result) from Regional Technical Implementation Unit for Health and Safety (UPTD/Unit Pelaksana Teknis Daerah Balai HIPERKES) West Sumatra (report date November 1, 2010) 1. No. 564/BHP/X/2010 for Measurement Audiometry (Hearing Function) test was performed on 93 workers from several stations such as kernel station, station sterilizer, boilers, clarification, press, wheel loaders, engine room. Of the 93 workers examined, 17 workers were found to have hearing loss, both at high frequencies as well as at low and high frequencies while 76 others were normal. The recommendation was re-examination is to be conducted by the company doctor and if necessary, spe-cialist doctor should be consulted. The company provided re-testing for those 17 workers, the result is there are two workers has impaired hearing function. The company has taken action in which both em-ployees have moved to another section which not affect to their hearing functions such as to the Empty Bunch Kernel station in accordance with decision No. Suat. 11/ AMP-PGA/SK-IV/2011. Another 15 workers are remain in existing position but highly recommended to use PPE (Ear Muffs) when during working time. Risk analysis for health programs and work safety was done by the identification and evaluation of as-pects of environmental impact analysis and risk as recorded on form REK-GEN-005 Revision 2 dated January 5, 2009. Some activities that have not been analyzed are: sorting activities, activities at the wastewater treatment plant (WWTP), the activities in the Office, the activities in the warehouse, clean-ing activities. This is raised as potential for improvement. In PT PMJ risk analysis for health and safety programs carried out also by identifying hazards and risk analysis of OSH using the form FRM-GEN-017 Revision 0 dated March 1, 2009, which made identification of the potential dangers of OSH from all activities carried out such as activities in the warehouse (unloading of fertilizer, chemical mixing, receiv-ing oil containers), etc, activities in the field (Fertilization, spraying, harvesting, machine operation, etc.). Records of the risk analysis should be reviewed if the actions identified and specified for high-risk con-trol are not effective, for example the frequent occurrence of injuries due to thorn related injuries at time of harvesting, or potential accident resulting from harvesters felling from the footbridges that currently appeared ineffective or not provided, due to the company is yet to come up with specified standards for footbridges in harvesting areas. OHS training recordings are available and well documented. OHS Training conducted for each repre-sentative’s estates on July 20, 2010. Training plan for 2011 is defined and includes: 1. Steam boiler training 2. Fire brigade 3. First Aid In Accident training 4. Freight Lift operator training. Records of trainings conducted are well documented such as: 1. Operator training was given to steam boiler Julham and Mr. Febrinaldi conducted by the Department of Labour of the Republic of Indonesia Trans 14 - February 18, 2011 2. Fire fighters Training carried out on 10 May 2011 with trainer Mr. Leonardo S 3. First Aid in Accident, Training held on 11 May 2011 with training participant from mill and estates. 4. Freight lift operator training, performed on 2 to 6 August 2010 by the Ministry of Manpower and Transmigration for two personnel. Emergency response and preparedness procedure has been established i.e. PRO-GEN-014, where potential emergency conditions have been identified including fire in estates, mill, housing, CPO tank leakage, effluent pond overflow, oil tanker truck rolled and Earthquake, but the procedure still does not include potential flood condition, while the location of PT PMJ and PT AMP 2,3 & 4 has potential signif-icant flooding condition. This is raise as potential for improvement. During mill visit, there were found some first aid kit boxes which were not completely stocked in ac-cordance with the list defined in the Minister of Manpower and Transmigration of the Republic of Indo-nesia Number PER-15/MEN/VIII/2008 regarding first aid at working area, such as first aid box in the warehouse location for chemicals is not equipped with scissors, bandages, flashlight, poridon iodine, and disposable gloves. At mill workshop, the first aid kit does not have tweezers, distilled water and al-cohol. This was raised as a non conformity. First Aid training has been given to workers at the estates and mill, the training was provided by the



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company’s doctor and representative from Manpower officer on 11 May 2011. Training records availa-ble and well documented. Records of the occurrence of any work accidents are maintained and regularly reviewed,e.g. there were 3 cases of occupational accidents occurred in the POM during 2010. The first occurred on 16 April 2010 as mechanical parts workers was injured by hot water that gushed from boiler when he wanted to do welding of the boiler drum pipe. Another incident occurred dated July 12, 2010 in which a worker’s hand was injured at the blower after the completion of the repair of station polishing drums in the kernel, and another incident dated 15 July 2010 but no results of its investigations. In the year 2011 until June, there is a case of occupational accidents occurred dated March 9, 2011 in which the left eye of a worker was splashed by a solution of caustic soda during removal from drum line 1 to line II. How-ever there is no evidence that review of the cause of accidents was done for all accidents at the mill and estates. In actual facts, several accidents happened every month, especially at PT PMJ and PT AMP 4 as seen from records of incidents documented. The corrective action and preventive action has not been determined to prevent recurrence. This is raised as a non conformity. Compliance status: Non Compliance NCR No. 2011-07 of 13 There are some first aid boxes not fully stocked as required by Regulation for Ministry of Labor and Transmigration Republic Indonesia No. PER-15/MRN/VIII/2008 regarding First Aid at work place, for example, at the chemical store of the mill, the first aid kit is not stocked with scissors, bandage, electric torch, Poridon Iodin and single use gloves, and at the maintenance room, the first aid kit is not stocked with pinset, aquadest and alcohol. NCR No. 2011-08 of 13 According to company’s SOP-GEN-003 rev.01, the form numbered FRM-GEN-010 shall be used to record investigations of accidents, however this was not evident during the audit. E.g.: Accident of caustic soda which splashed into a worker’s left eye on March 9th 2011 during the ac-tivity of moving the caustic soda from 1st line to 2nd line.

NCR No. 2011-09 of 13 There is no evidence that review of the cause of accidents was done for all accidents at the mill and es-tates, meanwhile in actual several accidents happen every months, especially at PMJ and PT AMP4 as seen from records of incidents documented. The corrective action and preventive action has not been determined to prevent recurrence.

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

Findings: Training and coaching programs for farmers have been established on June 19 and July 20, 2011, in accordance with the schedule specified program. Training and coaching involves an understanding of the oil palm plantations management, such as technical management of plantation maintenance, har-vesting, post harvest (FFB transport from estates to palm oil mill) as well as training about the technical working plan, define targets to be achieved and job monitoring and evaluation. Training is also associ-ated with the RSPO, OSH and environment. Training programs for employees(recorded on FRM-HR-018 rev.0) include: 1. Mechanical harvesting and sorting 2. Fertilization techniques 3. Spraying techniques 4. OHS and Environement 5. First Aid 6. etc Records of training are available such as: 1. Records of training on understanding of the RSPO requirements, and Environmental, Safety and Health (EHS) on June 14, 2011, there were 20 participants 2. First Aid Officers Training on the 11th of May 2011 3. Training related to knowledge about important aspects of oil palm plantations for better cultivation , dated April 8, 2011 4. Field staff training for effective & reliable way to better productivity on April 7, 2011



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Training records for each employee who invited as participants were maintained by HR departement, especially for permanent staff training. Some training has evaluation to see whether the participating workers understood what they have been trained or coached by the trainer but not all training conduct evaluation especially for temporary workers. Evaluation the effectiveness of training result is regularly conducted once a year as required in the company’s SOP for employee performance appraisal. Evidence that company uses experienced or trained contractors can be seen from for hiring contractors for maintenance and maintenance work, such as, some training for contractors was carried out on 12 May 2011 regarding Social Security and OSH, ISO and RSPO. Compliance status: Full Compliance

Criterion 5.1: Aspects of plantation and mill management, including replanting, that have envi-ronmental impacts are identified, and plans to mitigate the negative impacts and promote the pos-itive ones are made, implemented and monitored, to demonstrate continuous improvement.

Findings: The documented environmental aspect & impact assessment has been prepared for all activities occur-ring in the mill. The level of significance of the environmental aspects have been identified & relevant environmental objectives & targets have been established. The priority level of the actions are deter-mined by ranking points based on significant aspect ranking (1-50 points = Not significant, > 50 = sig-nificant) & risk level (46 - 85 = significant; >=66 = intolerable risk). Procedure identification of environ-mental aspect & impact has been reviewed - SOP-GEN-009 Rev 02, 2 May 2011. The environmental action plan has been prepared with time framed starting on Jan - Dec 2011. De-tailed monitoring programme are defined e.g. management of waste water, pollution prevention due to calcium usage, pollution prevention of oil to floor etc Sighted "Dokumen Pengelolaan Lingkugan (DPL)" i.e. "Environmental Managememt Document" for the mill, year 2006 which is approved by the Governor of Sumbar, ref no 660-18-2007 dated 2-2-2007 At PMJ and PT AMP I II & III, sighted documented environmental aspect & impact assessment - cover-ing all activities such as chemical spraying, storage of chemicals & hazardous waste, preparation of chemicals for spraying, fertilizing, workshop activities, clinic & housing. Documented procedure for han-dling of hazardous waste is available i.e. "Penanganan Limbah Beracun & Berbahaya (LB3)", SOP-GEN-006. Sighted also another procedure for handling waste oils & other wastes such as waste battery, oil filter, fuel filter etc from the workshop station. These SOPs are implemented for those aspects identi-fied as significant aspects. The environmental aspect & impact analysis have been reviewed & cover all of the significant activities carried out in the mill & plantations. But not for pond desludging activity is still not fully evaluated. This is raised as a non conformity, since the impact of desludging activities for envi-ronmnet is quite high, company should provide good control for potential impacts.

Records of regular report on environmental management in accordance with relevant regulations are available both in the mill and estates. At the mill, regulations related to monitoring such as waste water test, air emission, hazardous waste control etc are implemented. As for the estates, the key monitoring activities conducted are hazardous waste transaction records. This is to ensure accuirate inventory of the wastes are maintained. Record for legal register monitoring is well maintained at mill & plantation. There are no revisions to the environmental management document due to no changes in companies operating areas or activities, however, the company will continue to update their environmental man-agement program periodically in line with the company’s policy to prevent pollution. Compliance status: Non Compliance NCR No. 2011-10 of 13 The latest environmental aspects and impacts updated in year 2011 was reviewed & it was found that the pond desludging activity is still not fully evaluated.



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

Findings:

PT AMP & PMJ has conducted an assessment and identification of protected, rare and endangered species and HCV habitats within their area. An identification of flora and fauna has been carried out by a consultant, AKSENTA in year 2010. The results of these assessments are documented in PT AMP & PMJ’s HCV assessment report.

As of October 2010, based on HCV report, several protected species have been found in PT AMP ’s area especially in conservation zones, including the following species: there is suspected presence of sumatera tigers (Pantera tigris) in certain parts of remain forest in PT AMP and PT PMJ area, Tapir Tapirus indicus), Pangolin (Manis javanica), Honey Bear (Helarctos malayanus) (slow loris (Nycticebus coucang), pigtail macaque (Macaca nemestrina), honey bear (Helarctos malayanus), siamang gibbon (Symphalangus syndactylus), and leopard cat (Prionailurus bengalensis).

From the HCV assessment report it was stated that 5 types of HCVs were identified in the 4 PT AMP estate and PT PMJ, i.e. HCV 1, HCV 3, HCV 4, HCV 5 and HCV 6. Identified HCV 1 areas (Forest ar-eas containing globally, regionally or nationally significant concentrations of biodiversity values) in-clude HCV 1.2 and 1.3 areas due to identification of many wildlife species of protected and endan-gered status as explained above spread througout PT AMP and PT PMJ area. Total overlayed HCV area in PT AMP plantation is 490.95 ha, consisting of 284.89 ha inside company’s HGU area (3.09% from total HGU) and HCV area of 206.06 ha in smallholder (Plasma) area or 3.99% from total plasma area.

HCV 1 areas are located in all PT AMP and PT PMJ estates i.e. for remaining secondary forest area in all estates such as the forest “Hutan Rimbo Lahan Pendingin” in PT AMP 3. There is a small wet land area in PT AMP 1, forest with peat land in PT AMP 2, 3, 4 and PT PMJ and also mangrove forest in PMJ estate.

HCV 4 areas identified (Forest areas that provide basic services of nature in critical situations) include HCV 4.1 areas such as water sources and water treatment reservoirs located in PT AMP’s area and used for daily consumption, and HCV 4.2 and 4.3 areas such as riparian zones and firebreaks along Batang Anggang river, Masang Kiri river, and Masang Kanan river. HCV 5 areas (Forest areas fun-damental to meeting basic needs of local communities) includes areas used by the local people for, fishing, as water source, and other uses along riparian zone, and conservation zones as explained above. Ground water wells used by workers and communities in each estate were also identified as HCV areas in PT AMP 1,2,3,4 and PT PMJ. HCV 6 in the form of an old burial ground which is not maintained anymore was found in PT AMP 1.

A HCV management plan for all identified HCV areas in PT AMP’s estate 1, 2, 3,4 and PT PMJ has been established by PT AMP’s HCV team and this is documented in a HCV Monitoring and Action Plan. The document describes the activities planned for each identified HCV, total area to be managed and periodic monitoring activities for each identified HCV. The document was just recently completed, so there were no monitoring records available at time of the assessment. The company also made a specific standard operation procedure to protect wild life as determined in “SOP for wildlife protection (PRO-GEN-12)”. All monitoring result will be recorded on a standard form PRO-HCV-FRM-GEN-32. This form is also used to record activities of illegal fishing, hunting and other illegal activities that found during patrols.

To prevent inappropriate hunting and collecting activities within their area, the company established a mechanism for Ilegal fishing and hunting, and company also made sign boards and has periodic pa-trolling programmes.

PT AMP Plantation has assigned a conservation team in each estate to be responsible for handling all planned activities regarding environmental conservation and they will be assisted by several estate officers in carrying out their daily activities. All team members were trained on management and monitoring of all HCVs, and the training was conducted at Padang Regional Office on August 2010. Compliance status: Compliance with Observations



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

Findings: All waste and pollutions sources are identified and documented. The company established standard operating procedures for hazardous waste storage (‘Penyimpanan Limbah B3’), SOP-MIL-016, Rev 01, 19-7-2010. This SOP was also displayed at the waste storage area. It was found quarterly report sub-mitted to the environmanal department of Agam, i.e. ‘Badan Pengelola Lingkungan Hidup Kabupaten Agam’ - e.g. March 2010, contained reports for waste water analysis & inventory of hazardous waste. Sighted the inventory for hazardous wastes, i.e."Lembar Neraca Limbah Bahan Berbahaya Beracun" for Jan - Dec 2010 & Jan to March 2011. There is monthly inventory record by storekeeper for the hazardous waste e.g. April 2010, Feb 2011, June 2011 for used waste oil & found there are disposal of the waste to waste contractor, C.V. Arwana Padang. Verified in the Hazardous Waste Manifest & confirmed its traceability. Evidence of waste con-tractor's approval by the legal authority was sighted i.e. "Izin Gangguan Walikota Padang, 120/IG/KP2T". Confirmed the waste contractor is approved for collection of the waste oil. The approval was also included for the waste transporter i.e. PT Nirmala Tipar Sesama, approved by the " Ministry of Transportation Directorate General of Land Transportation ". All approvals received are still within the validity period. At PT AMP 1 & PT AMP II found internal inventory record used to record daily hazardous wastes gen-erated such as waste oil, waste empty chemical containers, filters etc. Noted the plantation notified the mill via a written report to indicate the type of wastes & quantity to be transferred to the mill for consoli-dated disposal. As seen on “Inventory of Hazardous Waste Delivery" dated 20-4-2010 & 11-5-2010, both for waste oil. There is proper segregation of waste implemented at Block 14 & 20 housing area. Bins are provided according to type of wastes to be disposed e.g. domestic waste vs hazardous waste. At PT AMP I, II, III & PMJ, spill kits are provided at the chemical store including other required protec-tive equipment such as masks, googles, and gloves. Estates and mills domestic waste management and disposal are well implemented to avoid or reduce pollution as seen on PT AMP I, II, and at the final disposal area (Tapak Pelupusan Akhir). Domestic wastes from both estate and the mill are properly managed following requirement on Standard on En-vironmental Condition, REK-GEN-015. Clear segregation between organic & inaorganic wastes are sighted & allotted at the proper disposal area EFB as mill waste are recycled as organic fertilizer in plantation area. All estates maintain records of EFB applications, and planned EFB applications, although it was noted that actual EFB applications are not in accordance with recommendations. At PT AMP II, sighted records of EFB application by area & indicated in Work Plan Map PT PT AMP Plantation Unit II for year 2011. Actual application record was sighted, including actual quantity of EFB applied per month & hectarage of application. Programme & progress of EFB application in the plantation for every month is monitored closely. Plan for EFB applica-tion is also available for year 2011. EFB aplication with dosage 30-40 tonne/ha or 80 -120 bunches eve-ry one circle oil palm tree to prevent Oryctes attack and organic fertilizer. From EFB monitoring records for January to June 2011, PT AMP mill sent EFB to AMP 1, 2 and 3 as organic fertilizer, total 33,830.106 tonne applied for plantation area. The biggest EFB application amount in AMP1 (19,772.690 tonne) es-tate because most of soil type in AMP 1 is mineral soil, and AMP2 (13,651.760 tonne) while EFB appli-cation in AMP3 is very little as the area has peat soil, and only 27.686 tonnes are applied. Sludge from effluent pond is applied at plantation, however at time of audit, the latest effluent test monitoring results had not yet been done as required by local regulations, and this was raised as a nonconformity under CR 4.4. There are no clear defined instructions available to include monitoring interval for sump clearance to prevent overflow of the waste water generated from washing of fertilizer bags & control of the waste wa-ter release for land application. This also includes consideration for prevention of water pollution & risks to human, this is confirmed as a non conformity.



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Management plan of hazardous waste and instruction of disposal of agrochemicals and their containers waste in accordance with the product label and existing regulations is well implemented as seen on company’s procedure regarding hazardouse waste management as implementation of company’s regulation No. PP 18 year 2009. Some records of waste monitoring/analysis are available such as at mill, sighted Lembar Neraca Limbah Bahan Berbahaya Beracun (Inventory of Hazardous Waste) for Jan to March 2011. Found on 7-2-2011, there 1,200 litre of oil are disposed to hazardous waste collector, CV Arwana. Cross checked the Berita Acara Serah LB3 dated 7-2-2011 submitted to CV Arwana showed that the quantity reported is 800 litres. Further cross checked the Hazardous Waste Manifest dated 7-2-2011 showing the same oil waste collected by CV Arwana, but the actual quantity collected was 1000 litre. This was raised as a non conformity. Compliance status: Non Compliance NCR No. 2011-11 of 13 There are no clear defined instructions available to include monitoring interval for sump clearance to prevent overflow of the waste water generated from washing of fertilizer bags & control of the waste wa-ter release for land application. This also includes consideration for prevention of water pollution & risks to humans NCR No. 2011-12 of 13 There is evidence of discrepancy in records of hazardous waste delivery. At mill, sighted ‘Lembar Neraca Limbah Bahan Berbahaya Beracun’ (Inventory of Hazardous Waste) for Jan to March 2011. Found on 7-2-2011, there 1,200 litre of oil are disposed to hazardous waste collector, CV Arwana. Cross checked the Berita Acara Serah LB3 (Delivery Record of Hazardous Waste) dated 7-2-2011 submitted to CV Arwana showed that the quantity reported as 800 litre. Further cross checked the Hazardous Waste Manifest dated 7-2-2011 showing the same oil waste collected by CV Arwana, but the actual quantity collected was 1000 litres.

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

Findings: Records of monitoring renewable energy use and its efficiency analysis (energy/ton CPO, or energy/ton palm product, sighted monthly record for monitoring of electricity usage for year 2009 & 2010 & found the usage is within 0.009 - 0.019 Kwh / ton FFB. Sighted also the usage of shell & fiber record for the boiler for year 2009 & 2010 which is monitored on monthly basis. The company has no established standard amount for renewable energy usage e.g. for usage of fiber & shell for boil. This is potential for company improvement for renewable energy consumption. Records of monitoring of fossil fuels use for operational reason and its efficiency analysis. Sighted monthly record for monitoring of diesel for year 2009 & 2010 & found the usage is within 0.36 - 1.06 li-tres / tonnes of FFB. Standard amount for this montoring has not been established. Similarly at PT AMP I & II, usage of diesel is being recorded but however, no specific target has been established for monitoring purposes. The company has identified fossil fuel consumption as environmental aspect as consideration to make environmental objective and program, but in developing their environment im-provement targets for year 2011, the company selected environmental targets to focus on for the year. In this case PT AMP decided that reduce fossil fuel is not priority for year 2011 but for next year as stated on their environmental program. Compliance status: Compliance with observations

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

Findings: There is no documented assessment for using fire since company has zero burning policy and compa-ny’s plan for a replanting activities will only begin in next 5 years. The first replanting program will begin



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in 2015 for AMP I for an area of 513.98 ha and year 2016 for an area of area 206.34. Replanting ac-tiveities for AMP2 is yet to be planned while for AMP 3, 4 and PT PMJ, the estates consist of young palms and no replanting is required until another 15 years. The company management has defined en-vironmental policy as updated in September 2010 decided to implement zero-burning in all develop-ment activities and the disposal of wastes, except under special conditions as stated in the ASEAN guidelines for zero burning activities. As part of implementation of the zero burning policy, there are no more burning of organic or inorganic domestic wastes around the office or housing areas. Organic and inorganic wastes are collected and disposed off at landfills in plantation area. To prevent contamination and to protect soil and water from waste pollution, the landfill for inorganic waste is covered with plastic before filled by soil. The land fill area is located away from the housing area is, there is direction from estate manager that land fill area shall be located not less than 500 m from housing and is overlap with grazing activities, the land fill ar-ea also far enough from public water courses or river. Procedures and records of emergency responses to land burning is available on each estates and mill, as determined on PRO-GEN-014 dated 02 May 2011. Fire drill and emergency responses simulation was done on March 11, 2011 include introduction of fire fighting tools and understand how to use them. The simulation results sighted is effective, because the participants understand how to use fire extinguishers. The emergency response teams (TPKD) has al-so been established, such as: At PT AMP TPKD 1 as chairman is Mr. Jainuddin Sinaga, and vice-chairman Mr. Marajambi Ritonga. Facilities and infrastructure for land fire prevention area available such as: Water pump, tubing and nozzle, knapsack sprayer, shovel, fire extinguisher tanks, buckets and axes, according to the recording on the form FRM-030-GEN rev.00 all facilities are in good condition, as recorded on inspection results in June 2011. Compliance status: Full Compliance

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

Findings: Evidence of identification of pollution and emissions sources at mills. This has been identified in the documented environmental aspect & impact analysis for each activity conducted in the mill. These have been evaluated & according to the risk level, actions / operational controls have been identified & im-plemented. Monitoring of key environmental parameters such as waste water discharge, air emission, noise level etc are implemented according to the defined frequency by the legal authority. Monitoring of pollution and emission quality of the sources identified, as explained above test results for May & Nov 2010 showed that the results meets the specification limits for 8 parameters for both boilers at the mill. Air ambient tests are also conducted on the same period also showed all tested parameters meeting the specification limit. As for noise level test, it was found on May 2010 - results exceeds limit (limit = max 70 dB (A), results = 78, location: in the mill & on Dec 2010 - similar results obtained (77.8). Noted that due to this reason, company’s environmental monitoring and management report (RPL / RKL report) mentioned that ear protection are required to be provided to the employee. Records of efforts and strategies employed to reduce pollution and emissions can bee seen at mill & all plantations - via implementation of operational control procedures identified in the environmental as-pect & impacts evaluation documents. Significant aspects which are required to be managed e.g. spill-age of chemicals / oil; emergency preparedness & response, disposal of hazardous wastes, storage of chemicals & hazardous wastes, handling of chemicals & hazardous wastes etc have been defined in the applicable operational control procedures. Personnel interviewed were able to demonstrate clear understanding on the control & implementation of the operational control procedures. Records of identi-fication, monitoring, and treatment methodology for POME is carried out via waste water treatment - records of waste water treatment are sighted & lab tests conducted as per defined frequency Compliance status: Full Complaince

Criterion 6.1: Aspects of plantation and mill management including replanting that have social



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impacts are identified in a participatory way, and plans to mitigate the negative impacts and promote the positive ones are made, implemented and monitored, to demonstrate continuous improvement. Findings: An environmental impact document (AMDAL) approved by the government is available, as well as an in-dependent social impact assessment (SIA) dated April-May 2010 conducted by an external consultant (AKSENTA). There are two SIA documents due to location of estate divided into two administrative area i.e. PT AMP 1,2,3 (December 2010 final version of document) in Agam District while PT AMP 4 and PMJ (January 2011) in West Pasaman District. Local communities and stakeholders were involved in the par-ticipatory process of the social impact assessment. There were 6 focus group discussions meeting to identify all aspect during SIA as seen on the attendance list and photographic evidence. Both positive and negative social impacts caused by mill, estates and smallholders activities to company stakeholders were identified, such as clean water availability, community access to the land, partnership program with smallholder scheme (plasma), smallholders income level, employee and workers welfare and workers re-lationship. All impacts were communicated to relevant parties on April 30, 2010, which were attended by 27 participants. The action plan for monitoring and management of social impacts has been established however there was no detail action plan which inform about schedule to manage and monitor the impacts. There have been no revisions made to company’s environmental management document (Dokumen Pengelolaan Lingkungan/DPL) both for mill and plantation activities that encompasses social impact as-sessments, due to no changes in the estate and mill operations, approved by West Sumatera Governoor on February 02, 2007 through decision letter no. 660-18-2007. There is a regular and scheduled environmental management and monitoring Report. According to DPL document and reported every 6 months, i.e. environmental management and monitoring report for se-mester 1 and 2 year 2010 was sighted. There have been no changes made company’s environmental management and monitoring document (RKL/RPL). In company’ social impact assessment document, has already identified the impacts of out grower schemes and is giving attention to the identified impacts. Several positive impacts from outgrow-ers scheme include increasing community welfare, opportunity job, improving the quality of life. While negative impacts include river riparian loss because of community members wanting bigger land, increas-ing potential conflicts among smallholder, increase level of accident because capability to purchase mo-torcycle getting high. The action plan for monitoring and management of social impacts has been estab-lished together with planning to manage and monitor the impacts from company’s activities. Similar im-pacts were managed together such as management and monitoring plan of river riparian. To minimize accident level, the company requires motorcyclists who pass company’s area shall use helmet, and out grower FFB truck shall have safety and First equipment. Compliance status: Compliance with Observations

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

Findings: The company has open and transparent methods for communication and consultation between grow-ers and/or millers, local communities and other affected or interested parties. The company has a doc-umented SOP for communication and consultation with the communities, i.e. PRO-BNM-006, PRO-BNM 007, PRO-BNM 008, including flow chart for information services; organization structure of ‘Bina Mitra’ (Relationship building) and decree letter no. 009/ED-WGP/Int-II/2007 regarding Bina Mitra as-signments. All documents have been communicated to local community representatives, including the Customary Leader, Head of Sub District, and Head of Village Unit Cooperation (Koperasi Unit Desa). Documents on the list of complaints and company’s respective responses since 2010 are available in all PT AMP estates and PT PMJ estate, an example of which was viewed at PT AMP III estate. The company has a list of relevant stakeholders, divided into 2 categories i.e. internal and external stakeholders. Internal stakeholders consist of employees, management, board of directors and share-holders. The list of external stakeholders consists of suppliers, customers, competitors, local communi-ties, government, journalists, investors, NGOs and other interested parties. The company’s Bina Mitra department is responsible for updating the stakeholders list. However some NGO which is relevent with the company’s activities still not included on the list. This is potential for the company to improve their



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stakeholder list. There is a log book for communication including information for incoming complaints and claim also suggestions from stakeholders at the estate and mill offices. The company’s responses are document-ed as well, e.g. letter dated 17/12/2010, No. 043/KUD-DS/XII/10 from KUD Dastra asking about FFB prices at PT AMP mill. A dedicated person who is responsible for consulting and communicating with local communities is available. The company has appointed staff responsible for activities such as public speaking and community relations, land acquisition and tenures, and community development/corporate social re-sponsibility is staff from Bina Mitra department in each estate Compliance status: Compliance with Observation Criterion 6.3: There is a mutually agreed and documented system for dealing with complaints and grievances, which is implemented and accepted by all parties. Findings: The company has an open system for dealing with communication and consultation with the communi-ties as defined in an SOP PRO-BNM-007, rev 00, issued dated May 01, 2010. There are meeting minutes and attendance in a socialization event on 16 June 2010, but there is no evidence that this procedure be accepted or approved by the parties. The company is willing to make the settlement of complaints and problems with various parties. There is confirmation from interviewed customary leader Jorong Aia Kasiang, KUD Dastra management, Wali Nagari Salare Aia who men-tioned that companies are willing to consult with the community. The company has a documented action plan for problem solving in Plasama KUD Mutiara Sawit Jaya regarding smallholder rights and allegations that land managed by PT AMP is overlapping with Tiku Customary land. This case under mediation by the NGO, YAPIDA The company has documented minutes of meeting on November 6, 2010 and December 24, 2010 re-garding discussion of plans for management of 100 ha of land consisting of the company owned land and smallholder area in KUD Dastra area II Tompek Tapian Kandis. There are records of incoming verbal complaints from local community members who are also subcon-tractors for PT AMP II (i.e. Hasyim and Nasrul Imam) dated July 21, 2010 regarding facility for subcon-tractors, such as a complaint regarding housing at PT AMP II and company’s response dated July 19, 2010. The company has procedures for the identification and calculation of fair compensation for the loss of legal or customary right of the land, with the involvement of local community representatives and rele-vant agencies and made publicly available, i.e.: REF-BM-003, dated on October 15, 2008 regarding land acquisition, however company should improve calculation method with involved community repre-sentatives. Compliance status: Compliance with Observations Criterion 6.4: Any negotiations concerning compensation for loss of legal or customary rights are dealt with through a documented system that enables indigenous peoples, local communi-ties and other stakeholders to express their views through their own representative institutions. Findings: The company has procedures for the identification, calculation and compensation for the loss of legal or customary rights of the land, which are being implemented with the involvement of local community representatives and relevant agencies, i.e. SOP 006, SOP for Land Permits which was made in year 2008. Land acquisition was done when the company first opened land and involved customary leader (ninik mamak) the customary land owners and local government. Claims problems arised between the owners of such lands, which were individuals named Tompek, Bawan, Tiku with Kinali and others. The main cause is due to unclear land boundary lines for land which is claimed as communal property. The company asked the government to assist in the mediation of land conflict settlement in a 1999 case where the parties involved requested the government and company to re-measure the disputed land claimed by Bawan. The issue was documented by the company. The results of re-measurement produced by National Land Agency (Badan Pertanahan Nasional - BPN) offices of West Sumatra Prov-



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ince No.610/1098/BPN-1999 dated August 23, 1999 were signed by the disputed parties i.e. Kinali and Bawan. Another issue that is currently emerging is the demand that PT AMP should manage all land that has been handed over by customary rights owners. Heru Safrudin who is the deputy of the Smallholders Cooperative of Dastra Katiagan region, said that from 480 hectares of land which was handed over to company, only 205 ha can be harvested. While 108 ha in the untreated condition and other 165 ha not yet planted. According to him, smallholder area should also be managed well, considering it is a part of compensation for the transfer of communal land belonging to company. The company has an action plan for the completion of the smallholders’ cooperative Region Katiagan case. Dated May 14, 2011 to discuss settlement of the problem. The company has a record of documents related to the identification of the parties to receive compen-sation, as well as the various documents that describe the chronological process of land acquisition such as submission of the Nagari Communal Land from customary leader (Ninik Mamak) to the Local Government of Agam District for oil palm development with smallholder scheme under PT AMP Planta-tion for customary land of Kinali and Kanagarian Manggopo. Records of negotiations processes and/or the details of compensation settlements were maintained in Bina Mitra office and a copy also kept by customary leader who signed the document, e.g. Minutes of Settlement land compensation (Siliah Jariah Ulayat) for an area of 300 ha, dated May 23, 1995 and the compensation amount ofRp9.000.000. There is land payment document from PT AMP to the KAN leader dated January 1995 for 200 ha land with amount RP. 35,000.000. Compliance status: Compliance wih observations

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

Findings: The company maintains documentation of employees’ pay and wages paid are in compliance with the minimum wages defined in both local and national government regulation. On the standard minimum wage, company complies with the regional minimum wage as per the decree from the Governor of West Sumatra which states that the regional minimum wage standard for estate workers in West Su-matra for year 2011 stated on decree letter no. no. 562-340-2010 regarding minimum wage standard starting January 1st 2011 shall be IDR. 1.055.000. or IDR 42.200 per day (25 working days). The mini-mum wages standard of PT AMP Plantation and PT PMJ complies with the related government regula-tion which is Government Regulation (Peraturan Pemerintah) no. 8/1981 on wages standard protection and Minister of Indonesian Manpower Regulation no. PER-01/MEN/1999 regarding minimum wages. Staff and workers receive receipts of salary payment (monthly payslips) in a timely manner and they are paid in cash. Evidence was seen in the form of payment slip for temporary workers. There are there categories of employees at PT PT AMP and PT PMJ Plantation, i.e. 1. Permanent staff i.e. management and office staff both for mill and plantation 2. ‘Karyawan Harian Tetap’ (SKU dan Harian Tetap), i.e. permanent daily worker 3. ‘Karyawan Harian Lepas’ (BHL 5 dan BHL 7), temporary daily worker Temporary daily workers (BHL 5) are casual workers who joined company since 2009, and they only al-lowed working with maximum 5 days a week as stated on Internal Memorandum No. HRD Wilmar. 020/HRD-WGP/Int-IV/2008, they will receive the wage with daily basis and will receive wages of IDR. 42.200 per day according to existing minimum wage standard. BHL 7 consist of casual workers has longer workday from BHL 5, i,e, maximum 7 days a week but still not appointed yet as permanent workers. The company provides accident insurance (Jamsostek) for permanent workers and BHL 7, while for BHL 5 the company will cover directly all expenses if there is an accident. There was evidence found that workers are paid below minimum wage standard. Staff and workers re-ceive receipts of salary payment (monthly payslips) in a timely manner and they are paid in cash.The company has documented working agreements that was approved by the local governmemt of Social, Man Power and Transmigration agency for the period of 2007-2009. There is approved extention of working agreements dated June 27, 2011, valid from April 09, 2011 to April 10, 2012. The extention working agreement was made by PT AMP/ PT PMJ workers union togeher with HR manager and Gen-eral Manager Assistant. The company provides adequate housing, medical, educational and other facil-ities free of charge to employees. Adequate electricity for 12 hours per day supplied by mill from 6 pm



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to 6 am, and there is one well as water source for every two houses. There are some other facilities has been provided by PT AMP and PT PMJ management in each estate division such as, mosque, day care for children, sport facilities. There is no school facilitiy provided by workers children; however the company provide transfer and pick up service for children going to school everyday to the nearst school located in Wonosari village. The company has documented agreements with contractors that they are to abide with local labour laws. Some clauses in the contract include compliance to labour laws. PT AMP and PT PMJ requires all con-tractors to follow all government regulations relating to workers, health and safety, RSPO Principles and Criteria, labour laws, and zero burning policy. This was viewed from contract between PT AMP and PMJ and a contractor for housing development. Compliance status: Full Compliance Criterion 6.6: The employer respects the right of all personnel to form and join trade unions of their choice and to bargain collectively. Where the right to freedom of association and collec-tive bargaining are restricted under law, the employer facilitates parallel means of independent and free association and bargaining for all such personnel. Findings: The company has a documented policy regarding freedom for association for workers that is available in several locations signed by the plantation head on August 2008. A statement permitting freedom of association for workers is also stated on the company’s documented Worker Agreement (‘Perjanjian Kerja Bersama’ or PKB) for 2008 to 2009 with the worker unions of PT AMP plantation for PT PMJ worker union just established for period 2010-2015 and FUK-SPSI PT PMJ under registering in Social, man power and transmigration officer West Pasaman District. The policy was also informed to all em-ployees and workers through an internal memorandum signed by PT AMP’s \ management, letter no: 002/WGP-HRD/I/2007 dated January 2, 2007 regarding approval worker union in PT AMP/PMJ planta-tion. Documented minutes of meetings with the labour union is available at SPSI’s estate office, and the worker union holds meeting as required especially if there is a labour issue. There is also a Bipartite Cooperation Institute (Lembaga Kerja Bersama (LKS) Bipartit) between SPSI and management of PT AMP and PT PMJ. The Bipartite cooperation Institute was approved by local government according to decree letter from the Government Head of Agam District Nomor: Kep.460/01/sosnaker/I/AG-2010. There were some minutes meeting between the labour union and the company’s management as seen on meeting records dated 19 May, 2010 and minutes of a meeting held among the SPSI committee on October 13, 2010. Meetings for worker union organizations in PT PMJ held on May, 26, 2010 and June 10, 2010 Compliance status: Full Compliance Criterion 6.7: Children are not employed or exploited. Work by children is acceptable on family farms, under adult supervision, and when not interfering with education programmes. Children are not exposed to hazardous working conditions. Findings: The company policy regarding child labour was defined since 2008 by Wilmar International Manage-ment, and informed to employees through an internal memorandum no: 026/WIP-HRD/Int-VIII/2009 dated on August 12, 2009. The working agreement between workers and company for period 2008 to 2009 states under article 12 that employee recruitment shall be done according to applicable laws and regulation. However during onsite audit in PMJ plantation there was found some evidence of employment of un-der-aged workers such as a sprayer aged 18 years old, but she has been working for 1.5 years, which means the company recruited her when she under less than 18 years old. Another under aged worker was also found working as a general worker. This was raised as a non conformity. Compliance status: Non Compliance NCR No. 2011-13 of 13 There is evidence found that PT AMP 1 hires employees below the minimum working age of 18 years old, as there was found that a female sprayer born August 4, 1993 was accepted as a general worker



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on May 24, 2011 when she was under 18 years old.

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

Findings: The company has a documented equal opportunities policy signed by the Group Plantation Head and Group Head CSR on August 2008. The policy was informed only to employees and communities sur-rounding company’s location. Based on information from the local communities, company has regularly provided information about job vacancies in PT AMP Plantation and PT PMJ for almost 2 years, both formally and informally. As informed by villagers from Bawan village, Jorong Koto working as mandors in PT AMP there are approximately 100 locals from 2 villages working for PT AMP/PT PMJ. There is no evidence of discrim-ination, and the following is evidence of equal opportunities provided to all workers: Female workers comprise around 15% of all of company’s workers Female workers also have opportunities to have high positions such as supervisors Workers of all ethnicities and religions, including Muslims, Catholics and other Christian denomina-

tions are provided with their respective places of worship such as mosques and churches. No workers interviewed on-site complained about any form of discrimination from the management of the estates or mill. Compliance status: Full Compliance

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

Findings: The management of PT AMP plantation and PT PMJ estate has a written policy regarding prevention of sexual harassment and all other forms of violence against women, as well protection of their reproduc-tive rights. The company’s internal working agreement for 2008-2009 and its extention clause 28 page 18 contains a clause regarding maternity leave and menstruation leave. Meetings to create awareness on this policy were conducted in every estate housing area such as in PT AMP 4 on July 22, 2010. The written policy was sent to all managers and includes point 4 pertaining to prevention of sexual harrass-ment and violence against women. There is an internal memorandum issud by the General Estate Manager i.e. letter No. 54/Mem-GEM/Int/VII/2010 dated 27 June 2010 prohibiting pregnant and breast-feeding woman to conduct chemical spraying. Protection of woman reproductive rights is defined clear-ly on working agrement 2011-2013 at PT PMJ estate. No evidence of sexual harassment was found during the time of the audit. The company established a Gender Committee, with representatives from each estate division. There is evidence of implementation of the reproductive rights policy, for example, the company has copies and records of menstruation leave and maternity leave forms applied by workers and these rec-ords are kept by the PT PMJ clinic and estate office. The company has a grievance mechanism defined in PT AMP Plantation and PT PMJ for grievances, violence against women and protection of reproductive rights, all complaints should be recorded on a form, i.e.“ Sexual Harassment Complaint Form” (FRM-HRD-053) according to procedure “Handling of Complaints of Sexual harassment (PRO-HRD-004). As determined on the procedure, the gender committee will approach the parties involved to attempt to resolve the issues. All relevant records of gender committee activities will be stored properly in the committee office. The company has also es-tablished a gender committee as a more specific grievance mechanism for female workers. Compliance status: Full compliance

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



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Findings: The company allows the public to access current and past prices for FFB. Current FFB prices and pre-vious day FFB prices are clearly published on the notification board in front of PT PT AMP’s mill at the security office, and near weigh bridge, e,g. FFB price for July 4, 2011 is IDR 1,025 /kg for big bunches and IDR 995 for medium sized bunches. The price will change every 2-4 days. The smallholder coop-erative will know updated FFB price during meetings held at the estate office in Agam or west Pasa-man. Independent supplier will know the FFB price through SMS. The company has mechanism for FFB purchasing i.e.No. SOP.001/TBS/VII/2009. There is a price difference for FFB from independent suppliers and smallholders. FFB price for independent suppliers is decided by the head office while for associated smallholders is from meeting results of the FFB price committee in each estate district of-fice. Based on interviews with FFB suppliers, they understood the terms of their contractual agreement with PT AMP, and they agreed that the contracts were fair, legal and transparent. The following are sample FFB purchasing contracts with the respective suppliers interviewed such as Bukit Sandiang Tiho Smallholders Cooperative (KUD) No. 299/AMP-DIR/PK-X/2001, dated October 11, 2001, the contract document was kept by both parties. There is some objection from KUD Bukit Sandiang Tigo regarding calculation of conversion factor of FFB weight to CPO weight. The company’s oil extraction rate (OER) was 18-19% while other mills have range of 20-21%. This indicates there is a potential for the company to improve its OER and hence the price of FFB awarded. Another objection is from KUD Dastra located in Agam district. They requested PT AMP mill to offer the same price for FFB sold from Agam District as FFB from West Pasamam dis-trict, even though the distance of FFB from West Pasaman District is farther away, and is offered a higher price due to additional transportation cost. To make FFB price calculation more transparent, company conducts a meeting with all KUD on July 2011. Before the meeting was conducted AMP mill has policy transportation allowance for incoming FFB from West Pasaman district due to the distance to the mill farther than form Agam District. However KUD Dastra asked to AMP will to give similar policy for all incoming FFB. Payments for supplier will be conducted according to agreed working agreement, for example, as seen on company’s contract with a housing contractor which is working base on contract No. 18/SP/AMP/III/2010; payment will be done 7-10 days after receiving the invoice. There is no complaint from company’s supplier and contractor regarding the payment process. Compliance status: Compliance with observation

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

Findings: The company makes contributions to local development, with evidence as follows: - The company carries out Community Development (CD) and & Corporate Social Responsibility (CSR)

activities from the year 2010-2011 - There are a number of documented CSR programme activities, such as: road maintenance, donations

to local communities based on requests, participation in school construction in Bawan Village and Jrong Kuto, Wonosari.

- There are a lot of job vacancies offered to local people directly and indirectly, such as positions for loading and unloading FFB, daily working for plantation maintenance,etc.

Compliance status: Full compliance Criterion 7.1: A comprehensive and participatory independent social and environmental impact assessment is undertaken prior to establishing new plantings or operations, or expand-ing existing ones, and the results incorporated into planning, management and operations. Findings: There were several “new plantings” which were planted within the company’s HGU areas after year 2007 in PT AMP 3 (187.5ha) and PT PMJ (44.97ha). These “new plantings” were actually deferred plantings resulting from the unduly long process of land acquisition caused by the need to resolve



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some difficult outstanding land conflicts. Basically, there were no new areas of development or expan-sion through new land acquisitions, either in PT AMP or PT PMJ. All the so-called newly planted areas in PT AMP3 and PT PMJ were actually part and parcel of the company’s old HGU permit which should have been developed before 2007 if not hampered by the said difficult-to-resolve land conflicts. In view of this, the implementation of the environmental management and monitoring document (approved by the local government of west Pasaman district in year 2009) which was meant to cover planting activi-ties in all PT AMP and PT PMJ areas, including the 187.5 ha of PT AMP3 and 44.97 ha of PT PMJ ar-eas, is deemed sufficient to meet the requirements of this Criterion. The document consist of identified environmental and social impacts, and several identified social im-pacts, such as community health, community perception, and community income are included in this document. The company has a social impact assessment document that was made in January 2011, the document was made with participation of communities from Nagari IV Koto, Nagari Katiagan and Kinali, as seen on the evidence of focus group discussion process attached in the SIA document. Re-port for environmental impact management and monitoring always done every 6 month such as reports for semester 1 and II year 2010. Impacts for smallholders have been identified, the company has established an action plan for impact monitoring and management plan, as seen on a capacity building planning document for cooperative members (KUD) which has partnership with PT PMJ and PT AMP, such as oil palm plantation man-agement, OSH and environmental aspect and cooperation management. Compliance status: Full compliance

Criterion 7.2: Soil surveys and topographic information are used for site planning in the estab-lishment of new plantings, and the results are incorporated into plans and operations.

Findings: Based on soil survey map produced by PARAM AGRICULTURURAL SERVICES, the 187.5ha in PT AMP3 and 44.97ha in PT PMJ were found to have the same suitability for oil palm planting as in all the rest of earlier planted areas in PT AMPs & PT PMJ as highlighted in Criterion 4.3 above. Based on soil evaluation results and recommendations from the company’s agronomist, plantation de-velopment is only in suitable land. The company will not make plantation in a soil type on deep peat soil (Galy type). Limited planting in shallow peat in PMJ and PT AMP 3. Most of the planted areas of the es-tate are those areas which are of low fertility, and the estate's soil analysis report includes recommen-dations to have a good fertilizer programme, monitor and mitigate soil degradation through cover crop establishment, fertilizer and application of EFB. The estate has implemented all these best practices in the management of their planted areas. The estate conducts annual leaf analysis and develops fertiliz-er application plans based on leaf analysis results, and has carried out plantings of leguminous cover crops (LCC) in the estate. This was confirmed through observations of the field made during site visits. Compliance status: Full Compliance

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

Findings: According to findings in the company’s HCV assessment report, there were no new planting replacing primary forests or any lands which were categorized as HCV area. Before the plantations were estab-lished, the company’s areas were actually cultivated farmlands owned by the communities or just sec-ondary forests. Compliance status: Full Compliance

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



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Findings: There is no steep terrain in PT AMP 3 and PT PMJ area, however all new plantings were done in peat soil. The condition of soil in new plantation area according to soil evaluation relt from PARAM has been explain on the CR. 7.3 above. To prevent soil damage company implement water management program and water monitoring activites. There is a map of deep peat soil distribution available on each estate, the map also inform about moni-toring points such as subsidence monitoring point, weirs position and water management program. As observed during onsite audit company regularly monitors water level consistently every day to ensure that the water level in the canal always in allowable range (50 to 80 cm) this is to prevent drying pro-cess or subsidence acceleration. Compliance status: Full compliance Criterion 7.5: No new plantings are established on local peoples’ land without their free, prior and informed consent, dealt with through a documented system that enables indigenous peo-ples, local communities and other stakeholders to express their views through their own repre-sentative institutions. Findings: PT PMJ has environmental management and monitoring document; it was made on year 2009 and has been approved by local government west Pasaman district. The document consists of identified envi-ronmental and social impacts and several identified social impacts include community health, communi-ty perception, community income include in this document. The company has a social impact assess-ment document that was made in January 2011, the document was made with participatory communi-ties from Nagari IV Koto, Nagari Katiagan and Kinali, as seen on the evidence of focus group discus-sion process attached in the SIA document. While environmental management and monitoring program for PT AMP 3 is following with PT AMP 1, 2 and 4. No specific socialization was conducted for the 2005 “new planting" in PT PMJ blocks 9 E, D and 2009 “new planting” in block 10A. This is because these two “new plantings” were part and parcel of the are-as programmed for planting by the company before year 2005 for reasons as explained under Criterion 7.1 above. During negotiations for land acquisition process witnessed by local government officers, the company explained that the land is planned to be made into oil palm plantation, other land claimed after compensation was paid will be responsibility of the former owner. There is a list of land compensation payment dated April 19, 2011, beside land compensation, the company also paid for growth of crops inside the land and damaged cottages, for example land com-pensation for Buhim in block 10B for 2.01 ha. There is no standard price for land compensation or growth of crops, the price was paid base on agreed negotiation result. All parties who received com-pensation payment signed minutes of payment. All records regarding history of land compensation pro-cess since negotiation until payment process were maintained both in “Bina Mitra” office and by the former land owner, such as: road map of land compensation process, land map, minutes meeting and handover land. There is sufficient documented evidence to demonstrate that land acquisition was con-ducted with Free Prior Informed consent, there was no evidence of violence or intimidation from both parties during compensation process. Compliance status: Full Compliance

Criterion 7.6: Local people are compensated for any agreed land acquisitions and relinquish-ment of rights, subject to their free, prior and informed consent and negotiated agreement

Findings: As explained on criteria 7.5 above, the company has a list of land compensation payment dated April 19, 2011, beside land compensation, the company also paid for crops inside the land and damaged cottages, for example land compensation for Buhim in block 10B for 2.01 ha. Documentation for land compensation for Buhim was well maintained on the Bina Mitra Ofice. The company has procedure to identify people entitled to receive compensation including information of calculation and payment for compensation as explained on the criteria 2.3 above. All parties who received compensation payment



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signed minutes of payment. All records regarding history of land compensation process since negotia-tion until payment process were keep maintained both in “Bina Mitra” office or the former land owner, such as: road map of land compensation process, land map, minutes meeting and handover land. All records are availble upon requested. All documents can demonstrate that land acquisition was con-ducted with Free Prior Informed consent; there was no evidence of violence or intimidation from both parties during compensation process. Communities that have lost access and rights to land for planta-tion expansion are compensated and given opportunities to benefit from plantation development, such as grazing in certain part of company’s area and fishing in the river and waterstream. Compliance status: Full Compliance

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

Findings: The company has an established zero burning policy, implementation of company’s zero burning poli-cy can be seen from the new planting area, there is no evidence of land burning found during onsite audit. As explained on criteria 5.5 above, company has procedures and records of emergency responses to land burning is available on eact estates and mill, as determined on PRO-GEN-014 dated 02 May 2011. Fire drill and emergency responses simulation was done on March 11, 2011 include introduction of fire fighting tools and understand how to use them. The simulation results sighted effective enough, be-cause the participants understand how to use of fire extinguishers. The Emergency response teams (TPKD) has also been established, such as: At PT AMP TPKD 1 as chairman is Mr. Jainuddin Sinaga, and vice-chairman Mr. Marajambi Ritonga. Facilities and infrastructure for land fire prevention area available, such as: Water pump, tubing and nozzle, knapsack sprayer, shovel, fire extinguisher tank, buckets and axes, according to the recording on the form FRM-030-GEN rev.00 all facilities are in good condition, as recorded on inspection results in June 2011. Compliance status: Full Compliance

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

Findings: Overall implementation plans are defined based on risk level evaluated for identifying significant as-pects. Verified & cross checked implementation of the actions such as waste management control, chemical management control, including efforts to eliminate the use of Gramoxone. It was sighted from chemical usage records that the last usage of Gramoxone (containing paraquat) was in September 2010, after which there was no more usage of this chemical. Continuous prevention improvement plans are in place for the estate, and monitoring of objectives & targets for environment (EMP) is conducted on monthly basis & results are recorded in FRM-GEN-018 (Monitoring Pencapaian Tujuan Dan Sasaran Mutu, Lingkungan & K3). Reviewed documented Quality & Environmental Manual, PML,19 April 2007. Documented procedure for monitoring & measurement for environment (PRO-GEN-010) & Environment & Safety Inspection (PRO-GEN-012) are available. There is a mechanism to create awareness of responsibility for that sub-ject that are regulated or whose effects are understood. The company’s evidence of efforts to reduce wastes include establishing procedures for minimising and management waste both hazardous and domestic waste are in place at the mill and estate. The proce-dure explains about how to collect and separate waste at source following government regulations. The company has a register of potential pollutants and a plan has been drafted to manage the potential from estate and mill production. All processes that produce regulated wastes are managed properly and monitored periodically. As described earlier, the company also carries out recycling of EFB and mill effluent through application in the field. A social impact management and monitoring program are also available (see explanation on 6.1 above), and impacts identified include impacts to clean water availability through CSR program and impact to



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community access to the land. To mitigate these impacts, the company has provided water wells for community surrounding AMP mill, and the company allow the community to use company’s road for community activities, etc. Internal audits are conducted & records for internal audit findings are sighted. Actions taken to address the internal audit findings are identified & implemented Latest management review meeting minutes dated 12 January 2011 has been reviewed & confirmed latest performance results have been reviewed by the top management. The EMP has been reviewed by the respective plantation & mill management team & achievement results are available Compliance status: Full Compliance

3.2 Identified Non-conformances, Corrective Actions Taken and Auditors Conclusions A total of 13 nonconformances were identified during the main certification assessment. These consisted of 1 major non-conformity and 12 minor non-conformities. For the major non-conformances, the company has taken the necessary corrective action to close these non-conformances, and this was verified by the audit team through documented evidence submitted by the company. For the minor non-conformances, the company has taken corrective action against these as well, and for those which could not be verified as closed through doc-ument checks, the closure of these minor non-conformities will be assessed during the next surveillance audit. A summary of all identified non-conformances, corrective actions taken and auditor conclusions is as below:

Criterion 2.2.2 (Major): Evidence that legal boundaries are clearly demarcated and visibly main-tained.

Non-conformance No. 2011- 01 of 13: 1. Legal boundaries shown on HGU certificate no.9 were found to differ from the actual ground bounda-ries from Block 4 to Block 9. In the field, planting has encroached into the riparian zones of Masang Kanan River in Blocks 4A&B. 2. Some boundary stone in smallholder area which is included in company’s HGU are not well main-tained, such as boundary stone no. 10 in PT PMJ, 18 & VII PT AMP 3 and 15 in PT AMP4. Correction: 1. To resurvey & request clarification about HGU boundary no. 12 (PT AMP 1) from block 4 to block 9

and request BPN to verify all boundary stones from block 4 to 9. 2. To develop an action plan to make HGU boundary stone no 10 at PT PMJ, no 18 &VII at PT AMP 3,

and no. 15 at PT AMP 4 can be installed and well maintained to make more visible, to be done with stakeholder participation including farmers

Corrective action : 1. To resurvey for all boundary stone in PT AMP 1 to ensure that all boundary stone are in the right po-

sition and make correction if any deviation. 2. To conduct regular inspection every six months to all boundary stones in PT AMP and PT PMJ. Auditor Conclusions: Closed The company provide evidence as follows : 1. Letter from PT AMP management to BPN West Sumatera regarding request to re-measure the

HGU boundary for PT AMP and carry out maintenance of HGU boundary no. 12. 2. New map resulted from re-measurement of HGU boundary by BPN and 3. Minutes of boundary re-measurement from BPN including statement that all PT AMP operation ar-

ea inside HGU boundary. 4. Mou with communities for boundary stone maintenance program, e.g. for boundary stone in HGU

no. 5 dated August 18, 2011.

Criterion 4.3.2 (Minor): A management strategy should exist for plantings on slopes above a certain limit (needs to be soil and climate specific).

Non-conformance No. 2011-02 of 13: The company’s no-chemical-application-only strategy for the protection of fragile soil, such as on the



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escarpment land in the riparian of Masang Kanan river in Blocks 4A&4B of PT AMP 1 is considered in-sufficient since this area is categorized as being susceptible to high risk of erosion/abrasion.

Correction: The company will carry out planting of trees to prevent erosion & abration in block 4A & 4B PT AMP 1 Masang Kanan river inside the HGU area. Corrective action : A riparian rehabilitation program was established which includes planting of trees to mitigate problems which could arise from fragile soil and to prevent erosion and riverbank collapse along the Masang Kanan river inside the HGU area. Auditor Conclusions: Evidence of corrective action plan accepted. Effectiveness of implementa-tion to be verified at next audit.

Criterion 4.3.2 (Minor): A management strategy should exist for plantings on slopes above a certain limit (needs to be soil and climate specific)..

Non-conformance No. 2011-03 of 13: An FFB collection road in Blocks 4A&B of PT AMP1 was found to have been constructed over areas with high erosion risk. Correction: Collecting road in block 4A&B nearby eroded land was closed.

Corrective action : The company has replaced the closed road with a safer new road which is away from the river riparian buffer zone areas.An impact analysis will be conducted for all activities such as spraying, road construction, for areas located nearby high erosion risk land areas. Auditor Conclusions: Evidence of corrective action plan accepted. Effectiveness of implementa-tion to be verified at next audit

Criterion 4.4.2 (Minor): Monitoring of effluent BOD.

Non-conformance No. 2011-04 of 13: According to the the company’s license of land application of mill effluent issued against regulation, Bu-pati Agam No. 324 Tahun 2009 (regarding Land Application Approval) dated 17-3-2009, the supporting attachments to the approval (‘Kewajiban & Larangan Bagi Penanggung Jawab Kegiatan Pemanfaatan Air Limbah Pabrik Pengolahan Kelapa Sawit Pada Lahan Perkebunan Kelapa Sawit PT AMP Planta-tions’), monitoring of soil water at sumur pantau (control well) at land application - land control block 8B & sumur penduduk (public well) is required to be carried out once every 6 months and parameters for the following: BOD / DO / pH / NO3 as N / NH3-N / Cd / Cu / Pb / Zn / Cl / SO4-2. The report is to be submitted to ‘Bupati gubernur, Menteri Negara Lingkungan Hidup’ (Governor, Ministry of Environment). However, at the time of audit, there is no latest test report available (supposedly due on April 2011). It was conducted on June 2011 & the report is still pending.

Correction: Conduct water sampling test for control well on March and September to ensure that reporting can be finished on April and October. Corrective action : Made waste water monitoring schedule for land application to ensure that is not delay for reporting process according to KEPMEN 28 and 29 tahun 2003

Auditor Conclusions: Evidence of corrective action plan accepted. Effectiveness of implementa-tion to be verified at next audit



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Criterion 4.4.2 (Minor): Monitoring of effluent BOD

Non-conformance No. 2011- 05 of 13: From cross checks of the actual daily journal for mill effluent land application, it was found on 8-5-11, 2-5-211, and other dates that there ware effluent application at block 6A was applied; however this block is not included in the list of approved blocks for land application as per Izin Land Aplikasi, Bupati Agam No. 324 Tahun 2009, 17-3-2009. The piping connecting the waste water for land application to block 6A has been disconnected & the activity of land application to this block has been stopped indefinitely. However, the objective evidence of root cause & corrective actions determination are not available to prevent recurrence.

Correction: The company dredging the silted up land application trench to make enough capacity. Corrective action : The company make land application mapping according to land application permit, and give appropriate sign board or marking on the filed.

Auditor Conclusions: Closed, verified during next audit. Criterion 4.6.3 (Minor): Records showing that no work with pesticides for pregnant and breast-feeding women.

Non-conformance No. 2011-06 of 13: It was found that a female sprayer at PT PMJ was determined to be pregnant on December 2010, but she still carried out circle spraying up until January 2011.

Correction: The company made transferred letter to another section which is no connected with chemical material according to doctor recomendation. Corrective Action Doctor give notification letter to management regarding pregnant woman. If a sprayer has detected pregnant by doctor or paramedic, they will transferred to another section which not connection with chemical material. Pregnant sprayers will be transferred to perform other type of work not related to chemical spraying

Auditor Conclusions: Evidence of corrective action plan accepted. Effectiveness of implementa-tion to be verified at next audit. Criterion 4.7.6(Minor): Evidence of OHS and first aid equipments available at worksites

Non-conformance 2011-07 of 13: There are some first aid boxes not fully stocked as required by Regulation for Ministry of Labor and Transmigration Republic Indonesia No. PER-15/MRN/VIII/2008 regarding First Aid at work place, for example, at the chemical store of the mill, the first aid kit is not stocked with scissors, bandage, electric torch, Poridon Iodin and single use gloves, and at the maintenance room, the first aid kit is not stocked with pinset, aquadest and alcohol. Correction: Completing first aid kit in chemical warehouse mill according to Permen-15/MRM/VIII/2008.



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Corrective action : Rechecking all first aid kit in all mill area according to PER-15/MRM/VII/2008 Doctor will give checklist for first aid content according to relevant regulation to all person incharge.. Auditor Conclusions: Evidence of corrective action plan accepted. Effectiveness of implementa-tion to be verified at next audit Criterion 4.7.8(minor): Records of the occurrence of any work accidents are maintained and regularly reviewed.

Non-conformance 2011-08 of 13: According to company’s SOP-GEN-003 rev.01, the form numbered FRM-GEN-010 shall be used to record investigations of accidents, however this was not evident during the audit. E.g.: Accident of caustic soda which splashed into a worker’s left eye on March 9th 2011 during the ac-tivity of moving the caustic soda from 1st line to 2nd line. Correction: Using Form-GEN-010 during accident investigation for Mr. Suyono. Corrective action : Communicate and provide awarness to all supervisor and EHS mill staff regarding Form Gen-010 Auditor Conclusions: Evidence of corrective action plan accepted. Effectiveness of implementa-tion to be verified at next audit. Criterion 4.7.6(Minor): Records of the occurrence of any work accidents are maintained and regularly reviewed.

Non-conformance No. 2011-09 of 13 : There is no evidence that review of the cause of accidents was done for all accidents at the mill and es-tates, meanwhile in actual several accidents happen every month, especially at PMJ and PT AMP4 as seen from records of incidents documented. The corrective action and preventive action has not been determined to prevent recurrence. Correction: Review all accident cases during regular OSH meeting (every 2 months) Corrective action : Evaluate all review result of OSH meetings every two months and provide recommendation to prevent accident Auditor Conclusions: Closed, verified during next audit Criterion 5.1.1(Minor): Revisions to environmental management document if there are changes in companies operating areas or activities

Non-conformance No. 2011-10 of 13: The latest environmental aspects and impacts updated in year 2011 were reviewed & cover all of the sig-nificant activities carried out in the mill & plantations. However it was found that the pond desludging ac-tivity is still not fully evaluated. Correction: Environmental impact assessment was done for desludging activities both on the field and effluent pond and documented.

Corrective action :



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Rquire all plantation supervisor to provide sufficient information during aspect and impact identification to cover all relevant information for impact identification.

Auditor Conclusions: Evidence of corrective action plan accepted. Effectiveness of implementa-tion to be verified at next audit Criterion 5.3.1 (Minor): Management plan of hazardous waste and instruction of disposal of ag-rochemicals and their containers waste in accordance with the product label and existing regu-lations. Non-conformance No. 2011-11 of 13: There are no clear defined instructions available to include monitoring interval for sump clearance to prevent overflow of the waste water generated from washing of fertilizer bags & control of the waste wa-ter release for land application. This also includes consideration for prevention of water pollution & risks to human

Correction: Used water from washing process fertilizer sack were drained to the field directly through pipeline to prevent overflow. Corrective action : The company made SOP for handling of used water from fertilizer sack washing process. Conduct evaluation used water storage to prevent water flow into natural courses and become polluter

Auditor Conclusions: Evidence of corrective action plan accepted. Effectiveness of implementa-tion to be verified at next audit Criterion 5.3.2(Minor): Records of waste monitoring/analysis.

Non-conformance No. 2011-12 of 13 : There is evidence of discrepancy in records of hazardous waste delivery. At mill, sighted Lembar Neraca Limbah Bahan Berbahaya Beracun (Inventory of Hazardous Waste) for Jan to March 2011. Found on 7-2-2011, there 1,200 litre of oil are disposed to hazardous waste collector, CV Arwana. Cross checked the Berita Acara Serah Limbah B3 (Delivery Record of Hazardous Waste) dated 7-2-2011 submitted to CV Arwana showed that the quantity reported as 800 litre. Further cross checked the Hazardous Waste Manifest dated 7-2-2011 showing the same oil waste collected by CV Arwana, but the actual quantity collected was 1000 litres.

Correction: Rechecking hazardous waste balance in POM and take correction for all missed recording delivery notes to CV Arwana. Corrective action : Make hazardous waste balance internally every month.

Auditor Conclusions: Evidence of corrective action plan accepted. Effectiveness of implementa-tion to be verified at next audit Criterion 6.7.1(Minor): Records of implementation of the company policy on worker age re-quirements.

Non-conformance No. 2011- 13 of 13 : There is evidence found that PT AMP 1 hires employees below the minimum working age of 18 years old, such as Perdi Pernando that was born August 4, 1993 was accepted as a general worker on May 24, 2011 when she was under 18 years old. Correction: Perdi Pernando is currently 18 years old, and is now eligible to be accepted as a general worker. The



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company will identify other under aged workers and will not extend working contracts with them until they reach 18 years of age. Corrective action : Conduct age rechecking on worker candidates during medical examination and signing of contract with personnel department. Auditor Conclusions: Evidence of corrective action plan accepted. Effectiveness of implementa-tion to be verified at next audit



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3.3 Noteworthy Positive Components

Some positive components were observed during main assessment e.g:

Criteria Comment

5.3 Good socialization method for waste management. Mechanism for separation between hazardous and non hazardous waste very clear and has been stored properly according to government regula-tion.

6.5.1 High commitment to implement RSPO requirement, expense much money to provide better facilities in regard to RSPO P & C requirement, such as Good Housing environment and facilities. Adequate resources have been provided (infrastructure such as building facilities, secondary containment / bunding, waste bins, inventory records etc) for waste management & this is clearly visible throughout the plantation & mill area

8.1 Significant improvement from last audit condition, during last pre assessment, the company only 62.% complied to RSPO P & C, however during main assessment more than 98% of RSPO P & C has been comply, 1 major indicators was raised from 65 indicator major .

3.4 Issues Raised by Stakeholders and Findings Pertaining to Issues A) Issues Raised during Stakeholder Consultation Meeting

No. Issues Raised Management Response Audit Verification

1

The company paid for local FFB only Rp. 1,360/Kg while the standard price is Rp. 1,468 for TM (mature fruit) 1 and Rp. 1,968 for TM (mature fruit) 8.

Calculation of FFB price is based on FFB quality, price fluctuations for CPO and PK. There is no writ-ten agreement to bind the local communities to sell their FFB to PT AMP mill. Price of FFB of-fered is guided by prevailing mar-ket price.

There are two mechanicsm to defined FFB price, i.e. for smallholder and outgrower. The price was decided by Medan head office according to information from local Plan-tation office (Dinas Perke-bunan). This is clearly explained on criteria 6.10 above.

2

There is no pollution at Sungai Masang Kiri caused by com-pany. The waste is managed in well manner.

No further Comment Verified during on site audit the company has good waste management system.

3

The company has a positive contribution on community’s economy

No further Comment Verified during on site audit the company has good rela-tionship with local communi-ties and has good CSR pro-gram as a kind of contribution on communities economy.

4 It is better for auditor to be ac-companied by stakeholder dur-ing filed checking.

TUV to comment Anybody is welcome to act as observer during TUV audits

5.

1. Customary leader, Katiagan has raised the issue of 1200-hectare land where it was claimed 60% is allocated for company owned estate and 40% for plasma smallholders. However, there is no clear infor-mation on the size of to-

1. Only 491 ha from the 1200 ha area can be planted, the rest are occupied by com-munities. The company owned area is 178 ha or 36% and plasma area is 313ha or 64%.

2. There are job changes from-fisheries into oil palm farmers. According to Katiagan Head of

1. The company has allocated certain area for plasma ac-cording to agreement with local communities. Total areal for smallholder scheme is not same with in-fomration what community said

2. There is some evidence found during audit related



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tal area . 2. There is significant reduc-

tion of fish catches from the sea after the company es-tab-lished.

3. The company should more focus for road maintenance to Tiagan

4. There is increment of com-munity economic since the company established

village, so many high tech ships steal in Katiagan fishing area.

3. Road maintenance program-has been done and ongoing process.

to the company’s preven-tion of water pollution through environmental management program. Clear explanation about company’s effort to prevent water pollution has been elaborated in Section 3.1, CR 4.4.

3. The company has road maintenance program regu-larly, but more focus for company facility. Road maintenance in community area were conducted occa-sionaly up on request

4. This comment could not be verified as it is outside of the audit scope.

6

1. How to assure that assess-ment result is objective?

2. How can we report if there are any findings from stake-holders?

3. RSPO is polliticaly sound or real on behalf of environmen-tal.

4. It is imposible oil palm plan-tation without forest conver-sion.

5. Forest descructive was done during construction the past, how to assses for RSPO

It is impossible to develop oil palm plantation without forest conversion. Forest destruction happened during plantation establish-ment in the past, how is it to be assessed for RSPO. There is a RSPO New Planting Procedure which shall be fol-lowed by whichever company that wants to open new area for oil palm planting. TUV to comment further.

We are independent, we will assesst according objective evidence and factual finding onsite considering to applica-ble legal regulation and exist-ing procedure. Stakeholder can report all findings to TUV office by fax, telephone or email or letter. There is an RSPO New Plant-ing Procedure shall be fol-lowed by the company whom will open new area for oil palm plantation.

7

1. PT PMJ is direct border with protected forest. Land per-mit for PT PMJ is include 600 ha protected forest as mangrove forest.

2. There is some crocodile habitat inside plantation ar-ea which is planned as con-servation zone by local gov-ernement.

3. There are some land con-flicts among the surrounding communities.

4. All plantations in Pasaman Barat district are not aware of the river riparian require-ment. The companies blamed the negative activi-ties were caused by the sur-rounding communities.

5. There is no plantation which

1. According to AKSENTA HCV assessment result, there is no HCV area in PMJ; however there is 70 ha HCV area in PT AMP4 nearby PT PMJ area.

2. Location of Crocodile is out-side the company’s HGU area.

3. The company commits to solve problem with agreed process.

4. PT AMP and PT PMJ is committed to the environ-ment management policy set by the company.

5. On the operation side, PT AMP and PT PMJ abide by the government regulations on forest protection as de-fined by the Ministry of For-estry.

The company’s explaination was accepted since all infor-mation regarding conserva-tion, protected area and high conservation value available on HCV document from exter-nal consultant. Refer to relevant CR 2.2.3 & CR 2.3 in Section 3.1 for fur-ther explanation on the pro-gress of resolution of the land conflicts



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keeps part of its land as for-est are

8

We look forward to PT AMP and PT PMJ receiv-ing the RSPO certificate.

No further Comment RSPO certificate will be is-sued upon approval by RSPO Secretariat.

9

The company does not pay at-tention to watershed area con-dition.

PT AMP and PT PMJ has policy regarding environemental man-agement and identify watershed with total 80,55 ha.

The company has environ-mental policy and program to protect all watersheds.

10

After the validity of HGU ex-pires the company should re-turn the lands to the customary leaders. This provision should be provided for the communi-ties.

PT AMP will follow land regula-tion

This should be communicated between community and gov-ernement.

11

Community’s expectations are FFB price increase and more transparant.

Local FFB price is determined based on market price fixed by the Management which takes market conditions and aggregat-ed price into consideration.

There are two mechanicsm to defined FFB price, i.e. for smallholder and outgrower. The price was decided by Medan head office according to information from local Plantation office (Dinas Perkebunan). This is clearly explained on criteria 6.10 above.

12

The company should make the boundaries between community and company land clearer to minimize land conflict.

Authorization of customary right boundary defined according to agreement amoung customary right holders its self.

There are still difficult-to-find boundary stones during the main assessment to dif-ferentiate between commu-nity land and the company land.

13

The company should increase CSR fund and include envi-ronmental in the CSR program

The company has a CSR pro-gram which focuses on environ-mental sustainability

Verified during on site audit the company has good rela-tionship with local communi-ties and has good CSR pro-gram as a kind of contribution to community economic sus-tainability.

14 The company is less attention to natural environment.

The company has environmental policy

The company has good com-mitment to protect enviroen-mental condition.

15

It is very difficult to find job op-portunties from company

According to existing data, 60% of workers is from local comuni-ties.

Many local communities works in PT AMP or PT PMJ both for temporary worker or local business.

16 Less attention for FFB from community land and difficult to sell FFB to PT AMP mill

PT AMP has FFB purchase mechanism through supplier se-lection process.

The company should inform for local communities regard-ing FFB purchase mechanism

17 The company never pay ”za-kat” (zakat is alms/tithe) to customary leader

PT AMP and PT PMJ had paid compensation money during land acquisition

There is a difference between “Zakat” (zakat is alms/tithe) and land compensation

18 The company should re meas-ure their land involve BPN Bawan and Tepian Kandis.

Can be done if there is an agreement with relevant cus-tomary leader.

The company’s explana-tion accepted. BPN was invited to conduct re-



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measurement s on a case by case basis and such process has already been conducted by PT AMP as correction of main audit findings (see explanation on section 3.2 NCR no. 2011-1 of 13).

19 Public road should be main-tained.

Road maintenance has been done.

The company has periodic road maintanence program.

20

The presence of company had a positive impact in terms of socio-economic and communi-ty cultural and local govern-ment

No further comment to add Verified on site clearly.

21

The company must consider its responsibility for workers in the areas of welfare, wages, work safety, leave and etc.

Workers welfare getting better

Verified on site and cleary ex-plained on Cr. 6.5 above.

22

Since the existence of PT AMP some low-lying areas are always susceptible to flood (3 times within a year).

.

According to research result from Universitas Andalas, flood caused by deforestation on up-stream of Masang River.

River riparian and other miti-gation measures to prevent flooding are not properly maintained as recommended in the HCV report

23

Coastal erosion had reached human settlements area. This occurs since the frequent flooding and high tide

Acording to research result from Universitas Andalas, flood caused by deforestation on up-stream of Masang River.

See explanation above.

24

River pollution caused the death of about 3,000 kg of fish

There was broken water dam in year 2002 due to heavy rain and flood in Agam district. To assist the villagers, the company as-sisted by adding fish eggs for breeding in the Batang Masang Kiri River.

During the audit time, auditor did not observe evidence of river pollution, and based on further interviews, the pollu-tion happened in the past. Auditor also can not verify company’s action of adding fish eggs in Batang Masang river. This issue will be moni-tored during surveillance au-dits.

25

Erosion along the riverbanks occurring within the plantations has resulted in some riverbank collapses. This has caused the river to become wider with frequent flooding in some lowland areas.

According to research result from Universitas Andalas, flood caused by deforestation on up-stream of Masang River.

There are programs to main-tain quality of river riparian and other watershed areas to prevent flood as included in the HCV management and monitoring plan. However, im-plementing the recommenda-tions contained in the HCV assessment report alone is considered insufficient.

26

Masang Kiri river has been po-luted can not used anymore by surrounding communities.

The company conducts water analysis and the result was no pollution was found in Masang Kiri river. The company ob-serves Batang Masang kiri riv-

Management respond can be accepted, has been verified during audit. Please refer to relevant criteria under section 3.1, CR 4.4 for further ex-



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er is still used for daily activi-ties.

plaination.

27

Internal community dispute is caused by the presence of oil palm plantation in community area.

This has got nothing to do with PT AMP. This is a govern-ment matter

Company can help through provide facilitation and make everything related to small-holder scheme activities is transparant.

28

Economic disparities occur be-tween company and sur-ronding community.

Generally community welfare has been increase.

Companies need to identify whether economic inequality is caused by the company ex-istence; there is no explana-tion on SIA document about economic inequality.

29

WALHI (NGO) West Sumatera objects to PT AMP getting the RSPO certificate

No further comment to add No further explanation why WALHI objects to PT AMP getting the RSPO certificate. PT AMP has improved their performance since RSPO pre assessment was conducted last year.

30

There is an issue regarding company‘s transparency espe-cially about problem solving (between company owned es-tate and smallholders) regard-ing FFB price calculation and social problem both external and internal

The company has policy re-garding transparency as al-ready distributed through cir-cular letter.

It was verified during audit. Please refer to relevant crite-ria under section 3.1, CR 1.1 and CR 6.10 for further expla-nation

31

There are no more rivers ripar-ian. Government through the local environmental officer has a program for improving the environmental performance especially river riparian zones, such as activities to plant with bamboos and mangroves. We recommend that rivers ri-parian restoration included in the CSR program, all compa-nies already have a CSR pro-gram but have not include for environmental. Only for social and health only. It is good if all companies prevent and im-prove riparian river with their CSR funds

The company has CSR program which is focus on environmental sustainability.

It was verified during audit. The company has program for planting with hardwood spe-cies along the River Riparian Masang Kanan and Masang Kiri.

32

What is the impact to local community if the assessment result is positive (pass) and what suggestion from RSPO and TUV if the assessment result is failed? We don’t want make a meeting only for formal ceremony. Calculation for FFB price should be clearer

TUV Communities can also inform or request information from the TUV Rheinland office by phone, email, fax or email.

33

Based on the meeting on 25 June regarding RSPO in PT AMP, on behalf of government

The company provided infor-mation regarding waste man-agement to local communities.

Management respond can be accepted, has been verified during audit. There is no



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and Bawan society, we ex-pressed requests pertaining to the mill waste treatment. Until now we have not been able to receive any news regarding requests made by the speak-ers at the last meeting. Be-cause it does not fit between what already socialized and the facts. There is not much transparency between compa-nies, government and commu-nity. There were indications during flood condition all waste dis-charged into the rivers. We have not received the re-sults of performance transpar-ency PT AMP waste disposal. Water quality in radius 0 m to 8000m from AMP mill has been contaminated, until now the water can not be con-sumed. Including disruption to the habitat of crocodiles. Water can not be consumed, the color have changed, as well as odor. Especially in Masang Kiri River. River Riparian in community only 1 m. In accordance with Law 32, until now company has not transparently respond to the letter: 1. A complaint on water pollu-tion still not followed up on since 1998. 2. Customary leaders claim about land

Proposed clean water during meeting on June 25, has been provided. Proposed road maintenance for Bawan Tuo road under Manage-ment approval.

more waste water from efflu-ent pond discharged to public stream/river. Company has land application program to prevent water pollution in the river across plantation area. The area of land application is far enough from the river. And company’s area also not directly border with the beach/sea. There is a water pollution case long time ago before company has land ap-plication program, This case was solved and record of problem were well main-tained at regional office and EHS office. Please refer to relevant crite-ria under section 3.1, CR. 4.4. 2 and CR 5.3 for further explanation.

34

How far does RSPO conduct assessments related to "Sus-tainability"? PT AMP mill existence in this area is causing the community to change to be oil palm farmer, so oil palm expansion is not only by the company, but also by the communities. Will company accept If there any non sustainable FFB sup-ply to AMP mill? If so, how company's efforts to ensure that farmers also follow the RSPO requirement?

PT AMP will not purchase illegal FFB. There is no requirement for local farmer to comply with RSPO P & C. The company’s awareness for lo-cal communities has been in-creased as required by RSPO.

No need further verification. Further explanation on RSPO requirements for scheme smallholders was provided.

35

The requirement to pass the RSPO certificate, for principle no. 3 and 8 it seems like need commitment, is it applicable

PT AMP & PT PMJ communicat-ed their commitment to local people surrounding PT AMP and

A lot of improvement was done by management, it was verified during main assess-ment and RSPO will decide



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for communities? Is written commitment required? When will improvements be imple-mented? We support companies to RSPO certification but with a written agreement to meet commitments in all 8 principles

PT PMJ area. certification decision after re-ported by TUV Rheinland.

36

1. Water pollution impact from Masang Kiri river can be felt until 2 or 3 kilometers from the beach, and it is very difficult to get fish in that area. 2. So far the positive impact from PT AMP operation is in-crease community income. 3. The development of oil palm plantation and smallholder scheme in PT AMP 3 is very slow

According to customary leader Katiagan (Buyung Ganto), a lot of modern ships steal fish in the sur-rounding Katiagan sea.

Management response can be accepted, will be verified dur-ing audit .Please refer to rele-vant criteria under section 3.1 for further explanation

37

Big thank you to the local gov-ernments Agam for allowing foreign investment capital. Before PT AMP was estab-lished, the high school gradu-ates from this region could be counted on one hand, but after the foreign investor come, it is become more and more Dur-ing the earthquake, PT AMP provided assistance to the community, while there were no donations from govern-ment. The company provides good support to the locals. The government and company should show a good coopera-tion

Ok, noted and thanks No further verificaton required

38

PT AMP is providing opportu-nities for economic develop-ment. The existences of PT AMP generate positive impact especially for tax and building permits (IMB). Also in terms of education and welfare, the company provided assistance, although not a lot but it is enough. CSR should be increased. We also have crocodile conservation area. May be a wildlife reserve area.

No further comment

No further verificaton required

39

I agree with the earlier com-ment that PT AMP is not give proper attention to preserve the riparian river condition.

See above explanation. Please refer to relevant com-ment above.

40 There is not much attention from company to local com-munity, job vacancy always

Job vacancies should more transparent and balanced

It was already explained in Section 3.1, CR 6.8 regarding findings on job vacancies.



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given to visitor, suspect a lot of collusion?

41

The company published rules without involving the local communities and local gov-ernments, such as warning signs with the statement “grain of palm, life for me”

The sign board only for company internally use.

The signboard is only a re-minder to its own workers to ensure all loose fruits are col-lected and ensure no FFB is left behind.

B) Issues Raised during Stakeholder Interviews On-site

No. Issues Raised Management Response Audit Verification

1

I request clarification about smallholder scheme area in Bawan village,as there is no clear boundary between company’s area and Bawan village area. In accordance with the customary leader Bawan village, I was appointed to claim the location of Bawan village area.

Smallholder schemes area (plas-ma) allocated to Bawan village is 226 ha, which is according to 30% from 754 ha available area in Bawan.

There is different perception re-garding plasma area Bawan village 226 ha.

With regard to this differentiation, company make agreement with customary leader Bawan to meas-ure the land area. However the cus-tomary leader was postponed the meeting to get clear information from company how wide the com-munity’s area Bawan village under company’s management on the next meeting 2nd July 2011.

Management response can be accepted, has been verified during audit. Please see explanation in section 3.1 for further in-formation.

2

I've repeatedly sent a letter regarding job vacancy es-pecially for people who have no assets and job-less. Which are not able to find work in local area. As local community asking to company for job vacancy?.

Distribution of job for subcontrac-tors has been considering as local communities capabilities

No verification required as this is a request to the company”

3

Cooperation with small-holders still not clear. Land boundary between compa-ny owned estate and smallholders land is not clear. Community planned for land claim

Area plasma Bawan 226 ha accord-ing to 30% from 754 available area in Bawan. There is different perception re-garding plasma area Bawan 226 ha. In regard to this differentiation company make agreement with customary leader Bawan to re-measure the land. However the customary leader was postponed the meeting to get clear information from company how big the commu-nity’s area Bawan under company’s management on the next meeting

See explanation no 1 above



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2nd July 2011.

4

The ”Jorong Tompek” Com-munity expects company al-ways pay attention to com-munities’ welfare, and public roads should be maintained. The FFB price should be increase to be the same as standard price. The communities expect company to provide electrical energy sources.

Environmental monitoring has been follow government regulation. The company has budget on road maintenance. The company can not provide elec-tricity but can help to facilitate the grid from The State Electricity Company (PLN) which provide electrical network to communities.

Management respond can be accepted, has been verified during audit.

5

- CSR program still not planned by the participa-tory methods. - Watershed is not main-tained. -There is no improvement of community capacity re-lated to oil palm manage-ment. - Communities still not in-volved in waste manage-ment. - Partnership program still not balance. We will support if the com-pany has better perfor-mance from RSPO as-sessment.

PT AMP has CSR and environmen-tal program

Please refer to section 3.1, CR 6.11 for further explanation.

6

There is no clear company’s program for the local com-munities especially for so-cial, youth, and religion as-pects. Less communication between the company and community. Since the company started-managing smallholder plan-tation especially for financial aspect and cost of plantation management, the communi-ties has suffered losses

Independent auditor from Indonesia Accountants institute (Ikatan Akuntan Indonesia) was involved to calculate the costs of the small-holders.

The result of the inde-pendent auditor is still not available.

7

PT AMP contributes to the community’s economic growth for community in Labuhan Tiku V Jorong. The company opens job opportunities for local peo-ple and increase economic awareness of oil palm.

No further comment to add No further comment form TUV

8

There is little attention from the company to receive FFB from community land and it is difficult to sell FFB to PT AMP mill

PT AMP has a FFB purchase mechanism through supplier se-lection process.

The FFB purchase mechanism has not been explained properly to local communities, only to existing FFB suppliers.

9 The communities’ expecta- FFB price defined by basic There are two mecha-



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tions are for FFB prices to increase and the company to be more transparent.

price FFB defined by man-agement FFB local prices are set based on the FFB basic prize which was determined by manage-ment based on market condi-tions and the price is publicly listed

nisms to define FFB price, i.e. for smallholder and out grower. The price was decided by Medan HO according to information from the Plantation local agency office (Dinas Perke-bunan). This is clearly explained on criteria 6.10 above.



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3.5 Acknowledgements of Internal Responsibility and Formal Sign-Off by Client It is acknowledged that the assessment visit was carried out as described in this report and we accept the as-sessment findings and report content. Signed on behalf of PT AMP & PT PMJ …………………………………………. Simon Siburat Group Sustainability Coordinator Date: 2 February 2012

Signed on behalf of TUV Rheinland Malaysia ……………………………………….. Dian S. Soeminta Lead Auditor Date: 2011-10-13



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APPENDICES

Appendix 1: Details of Certificate

Standard: RSPO Principles & Criteria for Sustainable Palm Oil Production; Indonesian National Interpretation: 2008

Certificate Registr. No.: 18501482 001

TUV Rheinland Malaysia Sdn. Bhd. certifies:

Certificate Holder: PT AMP Plantation Palm Oil Mill Tapian Kandis Village, Palembayan Sub District, Agam District, West Sumatera, Indonesia and its supply base according to the annex.

Scope: Palm Oil Production and Plantation Management System

An audit was performed, Report No. 18501482 Proof has been furnished that the requirements according to RSPO Principles & Criteria for Sustainable Palm Oil; Indonesian National Interpretation: 2008 are fulfilled.

The due date for all future audits is 07-04 (dd.mm).

Validity: This certificate is valid from 2012-06-07 to 2017-06-06. First certification: The certificate shall remain valid in period stipulated above provided that the certificate holder mentioned here continues to comply with the RSPO P&C requirements. Status of compliance of the certificate holder shall be based on the annual inspections conducted by TÜV Rheinland Malaysia Sdn. Bhd.



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The palm oil mill and supply base covered in certification scope are:

Name of Mill / Estate

Location GPS Location Latitude Longitude

PT AMP Plantation Palm Oil Mill

Tapian Kandis village, Palembayan sub-district, Agam district, West Sumatera, Indonesia

0009’17.610” 10001’44.891”

PT AMP Plan-tation

Estate 1

0008’22.6” 10000’28.5”

PT AMP Plan-tation

Estate 2

0009’30.2” 9955’13.4.”

PT AMP Plan-tation

Estate 3

0010’47.7” 9949’06.5”

PT AMP Plan-tation

Estate 4

0004’22.7” 9948’09.8”

PT Primatama Mulia

Jaya

Ampat Koto village, Kinali sub-district, Pasaman Barat district, West Sumatera, Indonesia

0004’22.7” 9948’09.8”

CPO Tonnage Total Productions*: PK Tonnage Total Productions*: Company Estates FFB Tonnages: FFB Tonnages from other sources: CPO Tonnage claimed for certification: PK Tonnage claimed for certification:

68,173 tonnes 16,738 tonnes 172,102.280 184,744.46 32,880 tonnes 8,073 tonnes

* for year 2010



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Appendix 2: Certification Audit Plan

Date / Time

(1) Organizational Unit and Processes

Auditor / Abbrev.

Interviewee Procedure - RSPO Element -

Standard Chapter

Monday, 04 July 2011 06.00-07.30

Dian,Fadli & Irfan Kadir will ar-riving from Jakarta Nelly Young will arriving from Kuala Lumpur Agus Salim Alfat arriveing from Medan Then traveling to Maninjau Re-sort

Monday,04 July 2011 13.00-17.00

Stakeholder consultation All audi-tor team

Tuesday, 05 July 2011 08.00-09.00

Opening Meeting Introduction by team leader. Presentation of estates by respec-

tive managers. Presentation of Oil Mills source of

FFB by respective managers

Auditor Team

Top Management & Related Manag-er

Dian will arriving from Jakarta and going to PT AMP site

09.00-12.00

Management Office, HGU legal requirement , All related legal requirement &

documentation checking, All procedure or SOP related op-

eration, Maps in appropriate scale.

Auditor Team

Plantation and Palm Oil manager

Principle 1 Criteria 1.1; 1.2; Principle 2 Criteria 2.1;2.2;2.3; Principle 3 Criteria 3.1;

12.00 Break PT AMP Mill 13.00-17.00

Economic Issue & Legal Issue Management Plan HCV Management Environement

Dian & Hendra

Manager Principle 3 Principle 4 Principle 7 Principle 5 Principle 2

Social issues Labour Union (if any) Contractors (if any) Workers facilities (house, scholl,

transport, sports, etc) Female workers Sexual harassement policy Health & Clinic Land used Local communities

Irpan & Fadli

Manager & Rele-vant Stakeholder

Principle 2 Criteria 2.1; 2.2; 2.3; Principle 4. Criteria 4.7; 4.8 Principle 6 Criteria 6.1 to 6.11 Principle 7 Principle 8

OSHAS, Enviroenmental Issue Agus & Nelly Yong

Principle 4 Principle 5

17.00 End of 1st day audit

Wednesday, July 6, 2011 Plantation PT AMP 3, 08.00 to 12.00

Economic Issue & Process Compliance

Management Plan HCV Management Environment Issue Legal compliance & Process

compliance

Dian Manager Principle 1 Principle 3 Principle 4 Principle 8 Principle 5 Principle 2

Social issues Fadli & Manager Principle 2



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Date / Time


Auditor / Abbrev.


Standard Chapter

Labour Union (if any) Contractors (if any) Workers facilities (house, scholl,


Irfan Criteria 2.1; 2.2; 2.3; Principle 4. Criteria 4.7; 4.8 Principle 6 Criteria 6.1 to 6.11 Principle 8 Principle 2 Principle 1Criteria 1.1; 1.2;

OSHAS, Enviroenmental Issue Agus & Nelly


PT AMP 2. 13.00 to 17.00



compliance




Irpan & Fadli

Manager & rele-vant stakeholders

Principle 2 Criteria 2.1; 2.2; 2.3; Principle 4. Criteria 4.7; 4.8 Principle 6 Criteria 6.1 to 6.11 Principle 8 Principle 2 Principle 1Criteria 1.1; 1.2;

OSHAS, Enviroenmental Issue Agus & Nelly Yong


17.00 End of 2nd day audit Thursday, 07 July 2011 Traveling to PMJ Plantation

PT PMJ.1 08.00 to 12.00



compliance




Fadli & Irfan





PMJ.2 13.00 to 17.00


Management Plan HCV Management Environment Issue

Dian Manager Principle 1 Principle 3 Principle 4 Principle 8 Principle 5



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Date / Time


Auditor / Abbrev.


Standard Chapter

Legal compliance & Process compliance

Principle 2



Irpan & Fadli





End of 3 days audit Friday, 08 July 2011

PT AMP 1 08.00-12.00

Economic Issue & Legal Issue Management Plan Environmental impact Energy efficiency

Dian Manager Principle 3 Principle 4 Principle 7 Principle 2

08.00-12.00



Irpan & Fadli


Principle 1 Criteria 1.1; 1.2; Principle 2 Criteria 2.1; 2.2; 2.3; Principle 4. Criteria 4.7; 4.8 Principle 6 Criteria 6.1 to 6.11 Principle 7 Principle 8

08.00-12.00

OSHAS, legal and Environmen-tal Issue

Agus & Nelly



12.00-13.00

Lunch and Break

13.00 Preparation for Closing Meeting 17.00 Closing meeting and present

findings

17.30 End of Main Assessment Saturday, 09 July 2011 06.00 Traveling to Padang continue

to Jakarta and KL GA … ( 8.30 am)

Appendix 3: List of Abbreviations AMDAL Analisis Dampak Lingkungan & Sosial

(Social & Environmental Impacts Assessment) AMP Agro Masang Plantation (previous name of PT AMP Plantation) BHL Buruh Harian Lepas (non Permanent Daily Workers) BKPM Badan Koordinasi Penanaman Modal (Investment Coordination Board)



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BPN Badan Pertanahan Nasional (National Land Use Agency) BST Bukit Sanding Tiga CD Community Development CPO Crude Palm Oil CSR Corporate Social responsibility EIA Environmental Impact Assessment ERTs Endangered, Rare & Threatened species EHS Environmental Health and Safety FFB Fresh Fruit Bunches EFB Empty Fruit Bunches HCV High Conservation Value HGB Hak Guna Bangunan (Building Use Rights) IDR Indonesia Rupiah IMB Izin Mendirikan Bangunan (Building Construction Permit) IPM Integrated Pest Management IUP Izin Usaha Perkebunan (Plantation Business Permit) KAMU Karya Agung Megah Utama KAN Komite Akreditasi National (National Accreditation committee ) KPS Koperasi Pinjam Simpan (loan and saving Cooperation) KUD Village unit Cooperation (Koperasi Unit Desa) LCC Leguminous cover crop LTA Lost Time Accident MSJ Mutiara Sawit Jaya MSDS Material Safety Data Sheets NGO Non-Government Organization OSH Occupational Safety & Health PANP Perkebunan Anak Nagari PasamanPMJ Primatama Mulya Jaya PKO Palm Kernel Oil POME Palm Oil Mill Effluent PPE Personal Protective Equipment RKL Rencana Pengelolaan Lingkungan (Environmental Management Plan) RPL Rencana Pemantauan Lingkungan (Environmental Monitoring Plan) SIA Social Impact Assessment SOP Standard Operating Procedure SPP Surat Persetujuan Presiden (President Approval letter ) SKU Satuan Kerja Unit ( Working Unit) TPKD Tim Pengendalian Keadaan Darurat (Emergency response team) TTK Tompek Tepian Kandis UKL Upaya Pengelolaan Lingkungan (Environmental Management Efforts) UPL Upaya Pengelolaan Lingkungan (Environmental Management Efforts) UPTD WWTP

Unit Penyelenggara Teknis Daerah Wastewater Treatment Plant



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Appendix 4: List of Stakeholders Interviewed and Contacted

No. Name of Stakeholder Institution - Address

Stakeholders Interviewed during Public Consultation Meeting

1. Wali Nagari Bawan (customary leader Bawan)

Kec. Bawan

2. Wali Nagari Selaras Air (Custom leader Selaras Air)

Nagari Selaras Air, Kec. Plambayan, Kab. Agam

3. Wali Nagari Katiagan (Custom leader Katiagan)

Kec. Katiagan

4. Camat Palembayan (Head of sub District Palembayan)

Kec. Palembayan

5. Camat Lebuk Basung (Head of sub district Lebuk Basung)

Kec. Lebuk Basung

6. Camat Ampek Nagari (Head of sub district Ampe Nagari)

Kec. Bawan, Kab. Agam

7. Camat Kinali (Head of Sub district Kinali)

Kec. Kinali

8. Kapolsek Tiku (Police Officer head Tiku)

Kec. Tiku

9. Kapolsek Kinali (Police officer head Kinali)

Kec. Kinali

10. Dinas Kehutanan Kab Pasaman Barat (Forestry Officer Pasaman District)

Komplek Padang Tujuh, Suka Menanti, Kab Pasaman Barat

11. Dinas Kehutanan Kab Agam (Forestry officer Agam district)

Jl. Sudirman, Kec. Lubuk Basung, Kab. Agam

12. Dinas Sosial dan Tenaga Kerja Kab Agam

Jl. Veteran No.5 Kec. Lubuk Basung, Kab. Agam

13.

BPLHD (Badan Pengendalian Lingkungan Hidup Deara) Agam District, ( environmental officer local)

Kec. Lubuk Basung, Kab. Agam

14. Environmental Officer West Pasaman

Simpang Empat, Kec. Kinali, Kab. Pasaman Barat

15. BPN( National Land Agency) Kab Pasaman Barat

Simpang Empat, Kec. Kinali, Kab. Pasaman Barat

16. NGO WPT Ampel Pasaman Barat,

Jl. Bhineka Tunggal Ika No.7, Kec. Pasaman Baru – Kab. Pasaman Barat

17. NGO Bina Mulia, Kota Padang – Sumatera Barat

18. WALHI Sumatera Barat Jl. Beringin IIIA No.9 Lolong Padang

19. NGO Yapida Sago Manggopoh, Kec. Lubuk Basung, Kab. Agam

20. Ikatan Pemuda Anak .Air Kasing

Anak Air Kasing

21. KUD Dastra Simpang Empat, Kec. Kinali

22. Koperasi Tompek Tepian Kandis

Kec. Kandis

23. KUD Mengopoh II Kec. Mengopoh

24. Koperasi Karyawan PT AMP Komplek Perumahan PT AMP Plantation

25. Karang Taruna IV Kinali Rambah IV Koto, Kec. Kinali

26. SPSI “Tolong Menolong” PT AMP

Komplek Perumahan PT AMP Plantation

27. PT Probesco Jl. Prof. Dr.Hamka No.14 Padang-Sumatera Barath

28. PT Hexindo Adiperkasa Tbk Jl. Raya By Pass KM 20, Tanjung Aur – Koto Tangah, Sumatera Barat



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29. Wonosari sub village representative

Wonosari

30. Tompek sub village representative

Tompek

31. Katiagan sub village representative

Katiagan

32. IU Roto sub village representative

IU Roto

33. Dt Bintaro Hitam Ninik Mamak Manggopoh

Kec. Manggopoh

34. Dt Mangkuto Rajo Ninik Mamak Labuhan

Kec Labuhan

35. Dt Nam Putih Ninik Mamak Kinali

Kec. Kinali

36. Dt. Bando Rajo Ninik Mamak Tompeh

Kec. Kandis

37. Dt. H. Bandaro Ninik Mamak Selaras Air

Kec. Pelambayan

Appendix 5: Observations and Opportunities for Improvement

No. Clause Observation

1. 2.2.2 To ensure the SOP of legal boundary is properly implemented, PT AMP and PMJ should make maintenance plan of legal boundary in accordance with SOPs based on the HGU map.

2. 4.1 The condition of FFB before sterilization process should be informed and documented to define how long for sterilizer process period.

3. 4.1 FFB sorting Procedure SOP-Mill-002 Revision 01 dated October 15, 2008 is not in acord-ance with the current sorting method which is being used at the mill where the calculation of FFB with the sorting criteria’s through the raw fruit is not the same as the procedure’s cri-teria which states to use fraction 00, and the fraction 0.

4. 4.1 The internal audit activities should not only cover implementation related to environment and OHS but for all in operational related to quality, because if refer to internal audit result not audit result related to quality especially in PT PMJ/PT AMP 4

5. 4.3 The company’s road maintenance program has not been carried out according to the de-fined road maintenance program; resulting is bad road condition within the estate especially for FFB transportation.

6. 4.4 A mechanism should establish to ensure there are no more mistakes during land applica-tion and implementation is done according to the land application permit.

7. 4.4 As the company is beginning implementation of plans for protection for riparian river buffer zones, the actual implementation of these plans will be assessed during next surveillance audit.

8. 4.4 The mill’s monitoring records of domestic water usage is recorded in tonnes water / tonne FFB, but this unit is not appropriate for domestic water usage.

9. 4.7 Consideration should be given to review consistency of the types of PPE to be used by the chemical sprayers e.g. respirators for all plantation workers, etc

10. 4.7 Records of risk analysis should be reviewed especially high risk control which was identi-fied but not effective yet.

e.g.: frequent occurrence of injuries caused by the thorns from the frond and fall down from harvester bridge



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11. 4.7 It is better to conduct earthquake simulation evacuation and evaluate the existing emergen-cy and response procedure because PT AMP has potential risk for this condition.

12. 4.7 Reports of OSH performance that are send to the Manpower and Tranmigration Depart-ment once every 3 months should include data on the health of workers, e.g.: the result of regular health examination.

13. 5.1

Consideration should be given to review & standardize the method of monitoring for envi-ronmental management programmes established for each objective. E.g. Only PT AMP II was able to demonstrate clear objective & target achievement monitoring via use of "EHS & Quality Objectives & Target Monitoring Achievement" form (Monitoring Pencapaian Tujuan Dan Sasaran Mutu, Lingkungan & K3). However, this is not sighted consistently at mill, PT AMP III & PMJ

14. 5.2 To ensure that river riparian still in good condition and can be optimized as HCV 4.2 and 1.2 area (Crocodile habitat) the company should make clear monitoring and management plan especially to support recovery of the crocodile habitat

15. 5.2.2 PT AMP’s management plan of HCV each year based on the document should include clearer guidance for the management of HCV 2011-2013 on how to achieve the target gradually.

16. 5.4 Monitoring of diesel oil consumption for this year was done in AMP I and II, however, no specific target (standard) consumption has been established.

17. 6.7 The company has a policy against chld labour, however this poicy is not stated in the ar-ticles of Letter Work Agreement for contractors. There is also no mechanism to monitor implementation of the policy of child labour by the contractor. Evidence sighted: Letter Work Agreement No. 37A/SPK/PT AMP/VI/2011 with Damrah Chandra, loading and un-loading contractor in the Mill.