Roundtable on Sustainable Palm Oil - TÜV … Certification Assessment PT SAMPOERNA AGRO Selapan...

Roundtable on Sustainable Palm Oil

Certification Assessment Report no.: 824 502 17055

Certification Assessment against the

RSPO Principles & Criteria Generic 2013 and

RSPO Supply Chain Certification System Nov 2014

PT SAMPOERNA AGRO

SELAPAN JAYA PALM OIL MILL and HIKMAH 2 ESTATE

Geronggang village, East Pedamaran, Sub District, Ogan Komering Ilir District,

South Sumatera Province

Date of assessment : July 18 – 22, 2016

Report prepared by :

Mhd Fundy Cholis Kurniawan (RSPO Lead Auditor)

Certification Decision by :

Abdul Qohar (Director)

Certification Body : PT TUV Rheinland Indonesia.

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

Jakarta, Indonesia. 12950 Tel: +62 21 579 44 579 Fax: +62 21 579 44 579

www.tuv.com

TABLE OF CONTENTS

TABLE OF CONTENTS ................................. ........................................................................................................ 2

1.0 SCOPE OF CERTIFICATION ASSESSMENT

1.1 National Interpretation / Standard Used ............................................................................................................ 3

1.2 Type of Assessment .......................................................................................................................................... 3

1.3 Certification Details ........................................................................................................................................... 3

1.4 Location and Maps ............................................................................................................................................ 3

1.5 Organisational Information / Contact Person .................................................................................................... 5

1.6 Description of Supply Base ............................................................................................................................... 5

1.7 Actual production volumes and project outputs. ............................................................................................... 6

1.8 Dates of Plantings and Replanting Cycles ........................................................................................................ 6

1.9 Area of Plantation (Total, Planted and Mature) ................................................................................................. 7

1.10 Progress against Time Bound Plan ................................................................................................................. 7

1.11 Audit against the rules for Partial Certification ................................................................................................ 8

1.12 Progress of associated smallholders or outgrowers towards RSPO compliance ........................................... 9

1.13 Approximate Tonnages Certified of Selapan Jaya Palm Oil Mill ..................................................................... 9

1.14 Recommendation for RSPO Principles and Criteria and Supply Chain Certification .................................... 10

2.0 ASSESSMENT PROCESS ............................................................................................................................. 11

2.1 Certification Body ............................................................................................................................................ 11

2.2 Qualifications of Lead Assessor and Assessment Team ................................................................................ 11

2.3 Assessment Methodology & Agenda .............................................................................................................. 12

3.0 ASSESSMENT FINDINGS ............................................................................................................................. 16

3.1 Summary of Findings pertaining to RSPO Principles & Criteria ...................................................................... 16

3.2 Identified Non-conformances against RSPO P&C Requirements, Corrective Actions Taken and Auditors Conclusions ........................................................................................................................................................... 39

3.3 Description of RSPO Supply Chain Management System November 2014. .................................................. 45

3.4 Identified Non-conformances against RSPO SCCS Requirements, Corrective Actions Taken and Auditors Conclusions. .......................................................................................................................................................... 47

3.5 Noteworthy Positive Components ................................................................................................................... 48

3.6 Issues Raised during Stakeholder Consultation Meeting ................................................................................ 48

4.0 CERTIFIED ORGANISATION’S ACKNOWLEDGEMENT OF INT ERNAL RESPONSIBILITY .................. 53

4.1 Acknowledgements of Internal Responsibility and Formal Sign-Off by Client ................................................ 53

APPENDICES ....................................................................................................................................................... 54

Appendix 1: Details of Certificate .......................................................................................................................... 54

Appendix 2: List of Abbreviations .......................................................................................................................... 56

Appendix 3: List of Stakeholders Interviewed and Contacted ............................................................................... 56

Appendix 4: Attendend list of stakeholder consultation meeting ........................................................................... 58

Appendix 5: Observations and Opportunities for Improvement ............................................................................ 63

RSPO Certification Assessment PT SAMPOERNA AGRO

Selapan Jaya Palm Oil Mill – Hikmah 2 Estate Ogan Komering Ilir Subdistrict – South Sumatera Pro vince

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1.0 SCOPE OF CERTIFICATION ASSESSMENT 1.1 National Interpretation / Standard Used

The operations of the palm oil mill(s) and its supply base of FFB were assessed against RSPO Principle and Criteria Generic year 2013 and the RSPO Supply Chain Certification Systems (SCCS) document (November 2014).

1.2 Type of Assessment

The certification assessment audit carried out on 1 (one) mill and 1 (one) company estates to this mill, was Selapan Jaya Palm Oil Mill and Hikmah 2 Estate, owned by PT Sampoerna Agro (PT SA). The date of Certi-fication Assessment of this unit was July 18 – 22, 2016.

The scope of the Supply Chain Certification System assessment covers the implementation of the Mass Bal-ance supply chain model of Selapan Jaya Palm Oil Mill.

1.3 Certification Details

The details of RSPO Certification Assessment of Selapan Jaya Palm Oil Mill are as per the table below Table 1: RSPO Certification details of Selapan Jaya Palm Oil Mill

RSPO Membership No. : 1-0211-16-000-00

Subsidary numbers of each certification unit : -

RSPO Certificate no. : 824 502 17055

Date of first RSPO certification & validity : January 25th, 2017. January 25th, 2017 to January 24th, 2022

Date of certification audit : July 18 – 22, 2016

Date of previous surveillance audit : This is certification assessment

CPO tonnages claimed for 2016 12,303.352 mt

PK tonnages claimed for 2016 2,797.488 mt

1.4 Location and Maps

Table 2: GPS locations for all estates and mills in cluded in certification assessment

Name of Mill / Estate Location

GPS locations

Longitude Latitude

Selapan Jaya Palm Oil Mill

Geronggang village, East Pedamaran subdistrict, Ogan Komering Ilir district, South Sumatera province.

3o42’27.37’’ 105o5’49.51’’

Hikmah 2 Estate Geronggang village, East Pedamaran subdistrict, Ogan Komering Ilir district, South Sumatera province.

3o39’20.55’’ 105o9’42.43’’



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Figure 1. Location Map Selapan Jaya Palm Oil Mill and Supply Based concession area in South Sumatera Province

Figure 2. Hikmah 2 Estate Map

Lokasi PT. TH



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1.5 Organisational Information / Contact Person

Contacts details of the company presented below:

Company Name PT SAMPOERNA AGRO (Selapan Jaya Palm Oil Mill and S upply Based)

Address Geronggang Village, East Pedamaran sub district, Ogan Komering Ilir district, South Sumatera Province

Contact Person Yusi Rosalina

Telephone +62 812 7123 8226

Email Yusi Rosalina <[email protected]>

1.6 Description of Supply Base

Selapan Jaya Palm Oil Mill (POM) is one of several palm oil mills owned by PT SAMPOERNA AGRO, and is located in Geronggang Village, East Pedamaran sub district, Ogan Komering Ilir district, South Sumatera Province. Currently, Selapan Jaya POM received FFB supplies from Hikmah 2 estate and also received FFB form Sampoerna Agro others estate and also smallholders. Then, Selapan Jaya POM also received FFB from from outgrowers. This Hikmah 2 Estate was under NPP Notification process by RSPO, so planted area since 1 January 2010 up will be under RSPO sanction about 38.80 Ha. This area could not claim as certified area and the FFB produced from this area also could not claim as certified FFB in 3 years. So that this area will exclude from audit scope (total area for audit scope) within 3 years. And will explain in P&C 7.3. The FFB supplies received from company-owned estates and other’s company estate are as described be-low:

Table 3: FFB Supply Information for Selapan Jaya P alm Oil Mill year 2015 and 2016

FFB Contributors FFB Supplied 2015 FFB Supplied 2016* Budget

production 2016** Tonnes % Tonnes %

Under Certification Process source (will certified source)

Mill supply based: Hikmah 2 estate 18,226.560 5.56 8,592.840 11.20 56,233.00 Sub Total 18,226.560 5.56 8,592.840 11.20 56,233.00 Non Certified source Others estate under PT SAMPOERNA AGRO Hikmah 1 estate 744.420 0.23 1,883.560 2.45 - Gading Jaya estate 349.870 0.11 2,488.820 3.24 - Tanjung Sari estate 52.020 0.08 1.064.080 1.39 - Hikmah 3 estate - - 1,237.550 1.61 - Hikmah 4 estate - - 2,897.570 3.78 - Hikmah 5 estate - - 2,150.400 2.80 - Mega Terang estate - - 226.610 0.29 - Limau Katsuri - - 330.670 0.43 - Nawa Surya Satu estate - - 246.400 0.32 - Selatan Jaya Permai - - 249.650 0.33 - Sub Total 1,146.31 0.42 9,877.74 17.64 - Smallholders 307,471.100 93.63 55,224.100 71,16 - Independent out growers 1,059.621 0.39 139.217 0.15 - Sub Total 308,530.721 94.02 55,363.317 71.31 367,194.00 Total 327,903.591 100 73,833.897 100 423,417.00

Note: *) until June 2016 received by Selapan Jaya POM



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1.7 Actual production volumes and project outputs. During the Certification Assessment to Selapan Jaya POM, record of certified sold available in place, as fol-low:

Table 4: Total and projected CPO and PK production and Certified product sold from Selapan Jaya

Palm Oil Mill

Remarks Amount (mt)

FFB CPO (mt) PK Certified tonnage claimed *) - 12,365.636 2,811.650 Total product tonnage sold claimed under RSPO e-Trace - - - Certified tonnage sold claimed under Green palm - - - Certified tonnage purchased - - - Actual Production for 2015 Actual OER and KER for 2015 - 20.84 5.61 Total production for 2015 327,903.591 68,335.102 18,395.398 Total production from supply base only for 2015 18,226.560 3,798.415 1,022.510 Projection Production for 2016 (mt) OER and KER projection for 2016 - 21.99 5.00 Total FFB process (certified and uncertified) 423,417.00 - - Total FFB production under supply based 56,233.00 - - Total certified FFB 55,949.76** Total certified product - 12,365.636 2,811.650 Total product (certified and uncertified) - 93,109.398 21,170.850

Note: *) certified production tonnage based on budget production in 2016 will claim as certified product **) this FFB projection production has been reduced from 38.80 Ha FFB production under RSPO sanc-

tion.

1.8 Dates of Plantings and Replanting Cycles

The company follows a replanting cycle of 25 years. Information on the dates of plantings are as per the ta-ble below.

Table 5: Year of plantings of company estates suppl ying to Selapan Jaya Palm Oil Mill Period year

2015.

Real Planted Under Scope Audit Under RSPO Sanction within 3 years

Year of Plantings

Hikmah 2 Estate (ha)

Year of Plantings


Year of Plantings


1995 1,655.56 1995 1,655.56 2011 34.80 1996 249.11 1996 249.11 2012 4.00 1997 94.52 1997 94.52 - 2002 15.00 2002 15.00 - 2005 229.90 2005 229.90 - 2006 43.90 2006 43.90 - 2008 24.00 2008 24.00 - 2011 34.80 - - 2012 4.00 - - Total 2,350.79 Total 2,311.99 Total 38.80

Note: Planted since 2005 – 2012 was under NPP Notification, until certification assessment, NPP report still processed reviewe by RSPO.

Table 6: Planned and actual oil palm replanting act ivities for company owned estates supplying to

Selapan Jaya Palm Oil Mill.

Estate name Total plan for replanting

Year (ha) Actual total replanted 2015 2016 2017 2018



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(ha) (ha) Hikmah 2 - - - - - - Total - - - - - -

Note: this table based on replanting budget for five years, and the budget not separate will certified area and no certified area.

1.9 Area of Plantation (Total, Planted and Mature)

Table 7: Oil Palm Planted Area Summary, FFB Product ion and Average yield/ha for Selapan Jaya

Palm Oil Supply Base estates.

Estate Name Total area (Ha)

Oil Palm Planted area

(ha)

Mature (Produc tion)

area (ha)

Immature (Non-produc tion)

area (ha)

FFB Production

(ton)*

Average yield/ ha (ton/ha)

Hikmah 2 estate 3,120.00 2,350.79 2,350.79 - 44,649.700 14.31 Total 3,120.00 2,350.79 2,350.79 - 44,649.700 14.31

Note: a half from total FFB production delivered to Telaga Hikmah palm oil mill.

Table 8: Land used data for Selapan Jaya Palm Oil M ill Supply Based

Estate Name

Total area (ha)

Rubber planted

Oil Palm Planted

Area (ha)

HCV/ Potential

HCV areas*

(ha)

Land used for other purposes (ha) Housing,

Road,other infrastruc-

ture **)

Nursery Un-

cleared Area

Other Land ***)

Hikmah 2 estate

3,120.00 - 2,350.79 53.82 144.00 - - 540.00

Total 3,120.00 - 2,350.79 53.82 144.00 - - 540.00 Note: *) HCV inside of oil palm planted **) Consist of emplacement/housing and roads ***) Consist of low land area. 1.10 Progress against Time Bound Plan

The company has time bound plan for RSPO certification assessment of other management units as per the schedule below.

Table 9: Time Bound Plan of the Other Management Un its

Name of Holding Location Time bound

plan for certification

Progress in 2016

PT Aek Tarum

South Sumatera

2016 Certified

Mesuji Smallholder 2019 Planned

Belida Smallholder 2019 Planned

PT Mutiara Bunda Jaya

South Sumatera

Permata Bunda POM 2016 Certified

Permata Bunda Dua Estate 2015 Certified

Permata Bunda Smallholder 2019 Planned

Harapan Dua Smallholder 2019 Planned

PT Gunung Tua Abadi

South Sumatera

Sumber Sawit Palm Oil Mill 2015 Certified

Sumber Sawit Estate 2015 Certified

KKPA Smallholder 2018 Planned

PT Bina Sawit Makmur South Sumatera



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Surya Adi estate 2016 Certified

PT Sampoerna Agro

South Sumatera

Selapan Jaya POM 2016 Under certification process

Gading Jaya Estate 2016 Planned

Limau Mungkur Smallholder 2019 Planned

Limau Manis Smallholder 2019 Planned

Limau Sundai Smallholder 2019 Planned

Sungai Indah Smallholder 2019 Planned

Sungai Pangeran Smallholder 2019 Planned

Gading Jaya Smallholder 2019 Planned

PT Telaga Hikmah

South Sumatera

Telaga Hikmah POM 2016 Planned

Hikmah 1 Estate 2016 Planned

Hikmah 2 Estate 2016 Under certification process



KKPA Smallholder 2019 Planned

PT Sungai Rangit

Central Kalimantan

Sungai Rangit Palm Oil Mill 2016 Planned

Baboti Estate 2016 Planned

Rauk Naga Estate 2016 Planned

Sungai Sagu Estate 2016 Planned

Waringin Estate 2016 Planned

Sukamara Estate 2016 Planned

Telaga Bintang Estate 2016 Planned

Sungai Rangit Smallholder 2019 Planned 1.11 Audit against the rules for Partial Certificat ion

Compliance of the Selapan Jaya Palm Oil Mill against the rules for partial certification according to RSPO cer-tification system year 2013 Generic, clause 4.2.4 was assessed through document checks and interviews and the head office and through findings of concurrent ISO : 9001 checks conducted at other management units of Selapan Jaya Palm Oil Mill. A summary of findings is as stated below.

Partial Certification Requirement s Audit Findings

a) The organisation is an RSPO mem-ber.

PT Sampoerna Agro Selapan Jaya Palm Oil Mill and Hikmah 2 Estate are subsidiary of PT Sampoerna Agro Tbk. Sampoerna Agro has been a member of RSPO since 10 January 2007 With membership No. 1-0031-07-000-00. PT Sampoerna Agro has been provide result of the self-assessment for all units entering estate and mill at the time bound.

b) A time-bound plan for achieving cer-tification of all relevant entities;

PT Sampoerna Agro has a time-bound plan to achieve RSPO certification for all relevant entities. A challenging time bound plan has been establish as deter-mined by memorandum of PT Sampoerna Agro Management Commitment signed by CEO on June 01, 2015. This is the 2nd revised time bond plan of PT Sampoerna Agro Tbk. Considering the readiness of all subsidiaries palm oil mill and estates under PT Sampoerna Agro Tbk.

e) No replacement of primary forest or any area containing HCV since No-

There is no evidence of replacement primary forest in subsid-iaries under sampoerna Argo. Some new development area



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Partial Certification Requirement s Audit Findings vember 2005. under subsidiaries of PT Sampoerna Agro i.e.

PT Sungai Rangit, PT Mutiara Bunda Jaya; PT Telaga Hikmah and PT Sampoerna Agro are under verification pro-cess for New Planting procedure.

f) There are no significant land conflicts.

There are identified ongoing land conflicts in several subsidi-aries of PT Sampoerna Agro such as: 1. Mega Terang estate with community from Sungai Menang

Village for 600 ha located in Block 14, 15 and 16 Mega Terang Estate.

2. PT Aek Tarum with Mataram Jaya dan Community of Kemang Indah village

3. PT Mutiara Bunda Jaya with community of Sungai Me-nang and Rantau Durian I Village.

Some action has been taken to solve the conflict. g) No labour dispute that are not being

resolved through an agreed process. In year 2015 there is No labour dispute in all subsidiaries PT Sampoerna Agro Tbk.

h) Legal non-compliance, aif any, are being resolved in accordance with the legal requirements, with refrence to RSPO criteria 2.1 and 2.2

Some of management units under Sampoerna Agro have not complied with certain legal requirements, for example in PT Sungai Rangit, PT Mutiara Bunda Jaya and others, there is an issue with the land area stated in the land use right certifi-cate (HGU). However, the company is taking action by invit-ing the National Land Agency (BPN) to remeasure the land and resolve the issue. The process is still ongoing.

1.12 Progress of associated smallholders or outgrow ers towards RSPO compliance

Selapan Jaya Palm Oil Mill has 18 smallholder scheme (KUD), with total area about 20,026.62 Ha with total member about 10,405 and production budget projection for 2016 (total FFB production production about 287,044,829 mt) in detail will presented below:

1. Bina Sejahtera 1,354.77 ha with 702 member; 24,337.512 mt 2. Maju Lancar 1,138.8 Ha with 569 member; 17,667.577 mt 3. Madya Karya Bhakti 1,106.52 Ha with 563 member; 17,691.269 mt 4. Permata Bunda 1,407 Ha with member 723; 21,853.065 mt 5. Subur Makmur 1,231.5 Ha, with 614 member; 16,761.233 mt 6. Mulya Indah Permai 1,000.7 Ha, with 490 member; 13,443.940 mt 7. Ipoh Raya 1,022.95 Ha, with member 528; 6,325.264 mt 8. Harapan Jaya Mandiri 289 Ha, with member 170; 1,681.636 mt 9. Sumber Sentosa 1,536.5 Ha, with member 786; 23,806.779 mt 10. Serba Usaha 1,640 Ha, with member 918; 24,580.160 mt 11. Intan 955.4 Ha, with member 505; 16,221.189 mt 12. Marga Mulya 1,044.22 Ha, member 583; 17,020.690 mt 13. Bina Tani Mulya 1,152.7 Ha, member 566; 20,466.708 mt 14. Jaya Makmur 1,430.66 Ha, with member 739; 24,285.720 mt 15. Sedya Mukti 1,274.5 Ha, with 643 member; 22,131.195 mt 16. Jadi Mandiri 630.6 Ha, with 300 member; 8,149.593 mt 17. Puger Mulya 446.4 Ha, with 248 member; 1,984.960 mt 18. Balian Sejahtera Abadi 1,364.4 Ha, member 758; 8,636.339 mt

This smallholder above was include in certification timebond plan, while in first time certification process will plan for 3 smallholder first (Bina Sejahtera, Mulya Indah Permai and Jadi Mandiri), because the company will include RSPO certification process for smallholder step by step. Until June 2016, all smallholder supplied FFB to Selapan Jaya Palm Oil Mill about 54,805.280 mt. For smallholder under Selapan Jaya Palm Oil Mill they have two (2) KUD/Smallholder will carry out replanting process in 2018 (Mulya Indah Permai (1,000.7) and Jadi Mandiri (630.6)) about total area both of two small-holder will replanting about 1,631.3 Ha.

1.13 Approximate Tonnages Certified of Selapan Jaya Palm Oil Mill

The approximate tonnages certified, based on projection year 2016 for company owned estates only (refer to the table above as follows:



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Crude Palm Oil (CPO) : 12,303.352 tonne Palm Kernel (PK) : 2,797.488 tonne

1.14 Recommendation for RSPO Principles and Criteri a and Supply Chain Certification

Selapan Jaya Palm Oil Mill and supply based has established and maintains an effective system to ensure compliance with the RSPO Principles and Criteria. The audit team has confirmed through the audit process that company practices complies with adequately maintains and implements the requirements of RSPO prin-ciples and criteria Generic 2013 and Supply Chain Certification System requirements (dated November 2014). TUV Rheinland Indoneisa recommends that Selapan Jaya Palm Oil Mill to be approved to get certification of compliance RSPO Certified Sustainable Palm Oil.



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2.0 ASSESSMENT PROCESS

2.1 Certification Body

TUV Rheinland Indonesia 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 Indonesia 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 Indonesia’s office is located in Jakarta, Indonesia.

2.2 Qualifications of Lead Assessor and Assessment Team The assessment team members of this certification assessment audit that were part of the same assess-ment team for the certification audit are as per the table below:

Name Position Qualifications / Experience

Mhd Fundy C Kurniawan

Lead auditor

Education: Master Degree in Natural Reseource and Environmental Management, Bogor Agriculture University Trainings attended: Environmental Impact Assessment (EIA), Ecologi-cal Risk Assessment (ERA), Internal Quality Audit Training for Quality Management System, IRQA-QMS ISO 9001:2000, IRQA-EMS 14001, High Conservation Value (HCV), RSPO Lead Auditor Course, ISPO Au-ditor Course, SCCS Auditor and ISCC plantation audit. Working experience: Experienced in Environmental Impact Assessment (EIA Assessment), Environmental Health Safety Senior Officer (EHS-Senior Officer) in Wilmar International Plantation, Internal Auditor for Wilmar International Plantation, Auditor for Rountable on Sustainable Palm Oil (RSPO), Indonesian Sustainable Palm Oil (ISPO), Timber Le-gality Verification Certification (SVLK) in PT TUV Rheinland Indonesia since June 2012 – present.

Naik Monang Parlindungan

Lingga Auditor

Education: Bachelor of Forestry, Gadjah Mada University. Training attended: ISPO Auditor, Quality Management System (QMS) Auditor/Lead Auditor (ISO 9001:2008) by IRCA, Environmental Manage-ment Systems Auditor/Lead Auditor Conversion Training by IRCA (ISO 14001-2004), Lead Auditor RSPO Training, HCVA Training and RSPO SCCS Training (2016). Working experience: Field Assistant PT Sapta Karya Damai (2008-2013), Auditor in PT Sucofindo (2013-2015), and Auditor in PT TUV Rheinland Indonesia (2015-present).

Ade Sudiana Auditor

Education: Bachelor of Forestry, Faculty of Forestry, Bogor Agricultural University Trainings attended: Lead Auditor course 2015 - Neville Clark; ISO 9001, Awwarness training of ISO 9001, 14001 and 18001, inhouse train-ing of ISO 19011 and ISPO, Training of Assesor for Sustainabiity Natural Forest Management (SFM) by The Indonesian Ecolabelling Institute (2008), Training of Auditor for Sustainability Forest Management By cen-ter for Educational and Training of Forestry, Department of Forestry (2010), Examination of competency for auditor of Sustainability Forest Management by Personal Certification Body-Rhino (2014),Training of Auditor For ISPO (2016) by ISPO Comission Working experience: Consultant and Trainer of : Quality Management System (ISO 9001),Environment Management System (ISO 14001), Safety Management System (SMK3/ OHSAS 18001), ISPO (Indonesian Sustainable Palm Oil), Consultant and trainer in PT FOCUS (2008-2016) ; Auditor of SFM in PT Forestcitra Sejahtera (2008-2016); Auditor of SFM, RSPO and ISPO , Auditor in PT TUV Rheinland Indonesia



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(2016-now)

Doni Auditor

Education: Master Degree in Rural Sociology, Graduate School of Bo-gor Agricultural University completed in 2005. Trainings Attended: GIS Training, Auditor Training of Indonesian Sus-tainable Palm Oil (ISPO), Training of Participatory Mapping, Training of Document Preparation HCV and SIA, Auditor Training of Sustainable Production Forest Management (SFM), Training and Up-Grading of SFM, Training of Mentoring technique for the Rural Farmers, Conflict Resolu-tion Training and Journalism Training. Work Experience : Frequently conducted certification audits of RSPO and ISPO for Palm plantation, the certification audit of SFM (Sustainable Production Forest Management) for HPH and HTI, worked as a consult-ant for the National Development Planning Agency, Ministry of Environ-ment and Forestry, Indonesian People Bank (BRI), Ministry of Rural De-velopment (KPDT) and the Ministry of Public Works, Director General of Cipta Karya, JICA and UN-HABITAT and UNDP, HCVF document draft-ing team for the company of HTI, HPH and constituent team for docu-ments of HCV / SIA for oil palm plantations. Since March 2016 till now, work at PT. TUV Rheinland Indonesia.

2.3 Assessment Methodology & Agenda The certification audit assessment combined with supply chain certification assessment was conducted from July 18 – 21, 2016 with some date with closing meeting, as per the assessment program below. Public con-sultation of Selapan Jaya POM and supply based carried out on July 20, 2016, attendant 38 person from all related stakeholders around of Selapan Jaya POM. The assessment was carried out in accordance with TUV Rheinland Indonesia RSPO audit procedure as well as the RSPO Certification Systems document and RSPO Supply Chain Certification Systems document. During assessment, the qualified TUV Rheinland assessors 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 estates, combined with common management systems, it was pos-sible to carry out both field and document assessments of all estates and the mill within the time frame with-out compromising the integrity of the assessment in anyway. Three estate and one mill were visited and the assessment team carried out field and document assess-ments of compliance to all the RSPO principles and criteria. Common systems were identified and specific evidence was recorded for individual estates. Interviews were conducted at all estates and the mill. The company proposed the correction and corrective action for all identified non conformities raised to the certification body 30 days after the closing meeting. Document checks to verify closure of major non-conformances was conducted and implementation of corrective actions for minor non-conformities will be verified during the next surveillance audit. The certifications assessment agenda is as explained below.

Certification Assessment Agenda

Date/Time Organizational Unit and Process Auditor/ Abbrev. Interviewee

Procedure, RSPO P&C Generi, RSPO SCCS Re-

quirement Monday, July 18, 2016

07.35 – 08.45 Flight Jakarta – Palembang All Auditor - GA 102

09.00 – 12.00 Travelling Palembang – field location All auditor - -

14.00 – 14.30

• Opening meeting • Team audit introduction • Presentation of pre-assessment non-

conformity progress

All auditor Management Repre-sentative/ Related PIC/Manager

Tuesday, July 19, 2016 in Hikmah 2 Estate

08.00 – 12.00

Checking document about : • Legal regulation compliance and eval-

uation

MK

Management Repre-sentative/ Related PIC/Manager

Principle and Criteria: 2.1; 2,2 3



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quirement • Legal land use rights • Long term economic/budget • Third party mechanism • Environmental document • HCV assessment • NPP Implementation

4.1.4 5.1; 5.2 7.3; 7.5; 7.8

08.00 – 12.00

Checking document related : • Procedure implementation and evalua-

tion • Soil fertility • Soil erosion • Water management • IPM • NPP Implementation • Continuous improvement

AS


Principle and Criteria: 4.1; 4.2; 4.3; 4.4; 4.5 7.2; 7.4 8

08.00 – 12.00

Checking documents related : • Chemical used • OSH • Training • Waste management • Energy efficiency • Zero burning activity • Emission, pollution, and GHG identifi-

cation, mitigation • Continuous Improvement

NM Management Repre-sentative/ Related PIC/Manager

Principle and Criteria: 4.6; 4.7; 4.8 5.3; 5.4; 5.5; 5.6 8

08.00 – 12.00

Checking documents related : • Transperancy • Code of Ethical conduct • Land dispute/conflict if any • Social and workers welfare • Community gender • Workers union • CSR • NPP Implementation • Continuous Improvement

DN Management Repre-sentative/ Related PIC/Manager

Principle and Criteria: 1.1; 1.2; 1.3 2.3 6.1 until 6.13 7.1; 7.6; 7.7 8

14.00 – 18.00

Stakeholder consultation: - Official Government - NGO’s - Local community - Other related stakeholders

MK, NM, AS, DN

Please provide some location for stakeholder consultation in Desa Ma-ribaya

18.30 -….. Travelling To Estate

Wednesday, July 20, 2016 Hikmah 2 Estate

08.00 – 12.00

Onsite visite : • Legal regulation compliance and eval-

uation • Legal land use rights • Long term economic/budget • Environmental document • HCV assessment • NPP Implementation

MK


Principle and Criteria: 2.1; 2,2 3 5.1; 5.2 7.3; 7.5; 7.8

08.00 – 12.00

Onsite visite : • Procedure implementation and evalua-

tion • Soil fertility • Soil erosion • Water management

AS


Principle and Criteria: 4.1; 4.2; 4.3; 4.4; 4.5 7.2; 7.4 8



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quirement • IPM • NPP Implementation • Continuous improvement

08.00 – 12.00

Onsite visite : • Chemical used • OSH • Training • Waste management • Energy efficiency • Zero burning activity • Emission, pollution, and GHG identifi-



Principle and Criteria: 4.6; 4.7; 4.8 5.3; 5.4; 5.5; 5.6 8

08.00 – 12.00

Onsite visite : • Transparency • Code of Ethical conduct • Land dispute/conflict if any • Social and workers welfare • Community gender • Workers union • CSR • NPP Implementation • Continuous Improvement


Principle and Criteria: 1.1; 1.2; 1.3 2.3 6.1 until 6.13 7.1; 7.6; 7.7 8

12.00 – 13.30 Break and Pray All auditor

13.30 – 17.30 Continue audit agenda or document check or verification All auditor

17.35 - …….. End of 2nd day audit

Thursday, July 21, 2016 Selapan Jaya Palm Oil Mill

08.00 – 12.00

Checking document and plant tour: • Legal regulation compliance and eval-

uation • Legal land use rights • Long term economic/budget • Third party mechanism • Environmental document • HCV assessment • SCCS

MK


Principle and Criteria: 2.1; 2,2 3 4.1.4 5.1; 5.2 Module E

08.00 – 12.00

Checking document and plant tour: • Procedure implementation and evalua-

tion • Water management • Continuous improvement

AS


Principle and Criteria: 4.1; 4.4 7.2; 7.4 8

08.00 – 12.00

Checking documents and plant tour: • OSH • Training • Waste management • Energy efficiency • Zero burning activity • Emission, pollution, and GHG identifi-



Principle and Criteria: 4.7; 4.8 5.3; 5.4; 5.5; 5.6 8

08.00 – 12.00

Checking documents plant tour: • Transparency • Code of Ethical conduct • Land dispute/conflict if any • Social and workers welfare • Community gender • Workers union • CSR


Principle and Criteria: 1.1; 1.2; 1.3 2.3 6.1 until 6.13 8



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quirement • Continuous Improvement

12.00 – 13.30 Break and Pray All auditor

15.30 – 16.00 Prepare for closing meeting, and internal auditor meeting.

16.00 – 17.30 Closing meeting All auditor Management Repre-sentative/ Related PIC/Manager

Selapan Jaya Palm Oil Mill

Friday, July 22, 2016

08.00 - ……. Travelling to Palembang All auditor 15.25 – 16.35 Flight Palembang – Jakarta All Auditor - GA 113

2.4 Stakeholder Consultation and Stakeholders Conta cted

The stakeholder consultation involved both external and internal stakeholders. External stakeholders were notified to make comments on the certification assessment by placing an invitation to comment on the RSPO website. Stakeholders included those immediately linked with the operation of the company such 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 practic-es 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 compa-ny’s area. A stakeholder consultation meeting was also held in Desa Maribaya Meeting Room on July 19, 2016. 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 be-fore 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 Riau province. In all interviews and meeting, the assessment team did not restrict discussion of both the positive and negative aspects of operations conducted by Selapan Jaya Palm Oil mill and its sup-ply estates. The stakeholder consultation meeting held with stakeholders during the audit was extensive and productive, with an attendance of 19 attendees. This was followed by site inspections, including visits to the local com-munities, interviews with land claimants and contractors, and inspections of worker amenities and infrastruc-ture. All stakeholder issues raised were recorded and forwarded to the management for their written re-sponsed and this is summarised in Section 3.4.The list of stakeholders that attended the stakeholder con-sultation meeting and stakeholders interviewed during the assessment is included as Appendix 4.

2.5 Date of Next Surveillance Visit The next surveillance visit will planned in November 2017.



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3.0 ASSESSMENT FINDINGS

3.1 Summary of Findings pertaining to RSPO Principl es & Criteria

The following is a summary of findings made for the criteria listed in the RSPO Principles & Criteria Generic 2013 and RSPO Supply Chain Certification System November 2014. During the certification assessment, found 13 nonconformity, consist of 6 non-conformities were assigned against Major Compliance indicators while 7 non conformities was assigned against a Minor Compliance Indica-tor. Further explanation of the non-conformities raised and corrective actions taken by the company are provid-ed in Section 3.2 & 3.3. The observations & opportunities for improvement are listed in Appendix 5.

Criterion 1.1: Oil palm growers and millers provide adequate information to other stakeholders on en-vironmental, social and legal issues relevant to RS PO Criteria, in appropriate languages & forms to al -low for effective participation in decision making.

Findings: PT Sampoerna Agro and Selapan Jaya Mill and estates still maintain the procedure to provide adequate in-formation to relevant stakeholders on environmental, social and legal issues relevant to RSPO and how to re-spond to the request of information. The procedure is Doc. No. P-SAG-HO-CA & L-08, Rev. No. 2 in January 1, 2016 Prosedur Komunikasi, Partisipasi dan Konsultasi (Communication, Participation and Consultation). This procedure mentioned the mechanisms on how the company would provide adequate information rele-vant to RSPO criteria to relevant stakeholders for effective participation in decision making such as environ-mental, social and legal issues. The information shared to the stakeholders was about RSPO: legal status of the company and free prior inform consent; plans and impact assessments relating to environmental and so-cial impacts; positive and negative impact of company activities to the community; environmental protection and biodiversity conservation (HCV); pollution prevention and reduction plans; details of complaints, griev-ances and negotiation procedures; community social responsibility program; no gender discrimination, no human traficking, no children labor and human right policy. This procedure was communicated to the stakeholders during the stakeholder meeting last year dated in No-vember 20, 2015. During the meeting PT Sampoerna Agro informed them about above issues. The aim of the meeting is to comunicate the issues and to get feedback from them to improve the RSPO’s implementation in the company. The auditor checked the minutes of meeting and during public consultation the auditor noted that stakeholders received this information appropr iately. Records of the meeting were kept well in Notulensi Pertemuan dengan Stakeholder (Minutes of Stakeholder Meeting). The company has a list of stakeholders and it is updated yearly. Compliance status: Full Compliance

Criterion 1.2: Management documents are publicly av ailable, except where this is prevented by commercial confidentiality or where disclosure of i nformation would result in negative environmental or social outcomes.

Findings: PT Sampoerna Agro keeps the records of requests on information and assistantance/donation from related parties as well as its responses in the form Rekaman Penerimaan Informasi dan Tanggapan Stakeholder (Record of Information Request and Responses). The records contain information ofreferences of letter, date, name, organization/institution, information/donation/assistance requested, action taken to the request, person in charge whom follows up and status of the request. For example, POM Selapan Jaya, requesting building material for repairing volley ball and badminton field in Embacang Village on August 8, 2015. Request had been approved by the company. Compliance status: Full Compliance

Criterion 1.3: Growers and miller commit to ethical conduct in all business operations and transac-tions.

Findings:



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The Company has a policy of business ethics code that was drafted on July 21, 2015. ANGGARDA PARAMITA (Towards Consummation)

- Value 1: meritocratic System "Award system on individual performance in accordance with the com-petence and achievement in organizational goals."

- Value 2: Requisite Organization "Organizations that promote good conditions for all parties to be able to work together effectively and the maximally, in order to reach the goals.

THE THREE-HAND PHILOSOPHY (Sustainability of the relationship between the three parties that is mutual-ly beneficial to each other).

- Value 3: Teamwork & Flexibility "Cooperation between the employee, employer and both remain concerned with common interests than personal interests."

- Value 4: Respect "Behavior of mutual respect, both inside and outside the organization." - Value 5: Integrity and Ethics "The consistency between the values adopted, the actions taken and the

results achieved." - Value 6: Community "Delivering value to the local community, as a stakeholder of the organization."

Policy of business ethic code had been communicated to all levels of employees at Hikmah 2 Estate, on March 11, 2016. The location was in Block 14, Plot B (a morning assembly location), attended by 236 people. Then to all levels of POM Selapan Jaya employees on January 30, 2016, that was attended by 156 people. Compliance status: Full Compliance

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

Findings: List law and regulation document number FM-SAG-RO-SUS-070001 Rev 02 Issued July 01, 2014 available in place. The law and regulation list covered all law and regulation from national, international ratification and lo-cal regulation. Company has carried out the update law and regulation based on memorandum letter number 080/USU/VII/2016 dated on July 13, 2016. This letter addressed to all estate manager and mill manager un-der Sampoerna Group include Hikmah 2 estate manager and Selapan Jaya Palm Oil Mill manager. Law and regulation covered about plantation, OHS, environmental, labour regulation, and others related. Example for regulation compliance, such as:

a. Plantation business permit number 324/KEP/D.PERKE/2011 on behalf PT Telaga Hikmah, covered area about 16,588.93 Ha, located at: - Sumber Hidup village, Pulau Geronggang village, East Pedamaran subdistrict, about 6,872.3 Ha. - Embacang and Balian village, Mesuji Raya subdistrict, about 5,701 Ha. - Pagar Dewa village, Mesuji subdistrict, about 239,53 Ha. - Sido Mulyo and Talang Jaya village, Sungai Menang subdistrict, about 3,776.1 Ha.

This plantation business permit consist of: Hikmah 2 estate covered area about 3,120 Ha. (audit scope). Hikmah 1 estate covered area about 3,752.3 Ha. Hikmah 3 estate covered area about 3,374 Ha. Hikmah 4 estate covered area about 3,776.1 Ha. Hikmah 5 estate covered area about 2,327 Ha.

b. Hazardous permit for temporary storage of Selapan Jaya mill based on Head of District decree num-ber 660.1/03/KEP/B.LH/2014 with 180 days time limit for hazardous storage. This decree issued on January 30, 2014, in Jakarta, valid for 3 years from issued.

c. Palm oil mill permit for PT Sampoerna Agro (Selapan Jaya Palm oil Mill and Gading Jaya Esteta) No.221/KEP/D.PERKE/2010 date on June 09, 2010, for palm oil mill with production capacity 120 ton FFB/hours.

Estate has procedure for law and regulation number No.P-SAG-RO-SUS-07 issued on October 30, 2015. Procedure explained about person in charge who responsible for ensure the law and regulation identification, implementation and evaluation, i.e.:

- Sustainability responsible for law and regulation identification, evaluation and communicate the evaluation result.

- Estate manager responsible for prepared the work program to full fill the law and regulation in each work department.

For 2016, the evaluation process will carry out in August – September. Record evaluation for 2015 period available in place. Evaluation carried out in every once year for all related law and regulation. Evaluation rec-ord mentioned about plan for compliance, PIC and reference also current existing compliance condition.



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Based on procedure above, company has mechanism for ensuring law and regulation compliance. Law and regulation compliance will ensuring through the update and evaluation mechanism every once year. Proce-dure also mentioned in page 7, point 7.2 “law and regulation update carriy out by CAS Department (Corporate Affair Service Department). This department will responsible to carry out the updated. This department as source of law and regulation. Procedure not mentioned very clear identification law and regulation process, and this is as observation to the company to make clear this section. But found some nonconformity related law and regulation noncompliance, i.e.:

- Environmental management and monitoring report for mill and estate not fully accordance to en-vironmental management and monitoring matrix plan.

- Found some hazardous was exceed from the time limit storage time, i.e.: ex-oil/lubricant. - Found several dump truck operator did not have license accordance to the Ministry of Man Pow-

er decree No.09/2010. This raised as nonconformity (NCR RSPO00546) . Compliance status: Non Compliance NCR RSPO00546 Found some nonconformity related law and regulation noncompliance, i.e.:

- Environmental management and monitoring report for mill and estate not fully accordance to en-vironmental management and monitoring matrix plan.

- Found some hazardous was exceed from the time limit storage time, i.e.: ex-oil/lubricant. - Found several dump truck operator did not have license accordance to the Ministry of Man Pow-

er decree No.09/2010.

Criterion 2.2: The right to use the land can be dem onstrated, and is not legitimately contested by loc al communities with demonstrable rights.

Findings: Company has record of legal ownership based on:

a. Decree letter of Land National Agency region of South Sumatera number 01/HGU/BPN-26/2004, covered area about 126 Ha located in Mesuji subdistrict, OKI District for 35 years. Issued in Palem-bang on October 19, 2004. This decree letter, follow up by land use rights certificated number 12, Desa/Kel: Ogan Komering Ilir, valid until 23/11/2039, covered area about 126 Ha. Issued on Novem-ber 24, 2004 in Kayu Agung.

b. Decree letter of Land National Agency number 02/HGU/BPN/2004, covered area about 7,175.6 Ha located in Mesuji subdistrict, OKI District for 35 years. Issued in Jakarta on January 7, 2004. This de-cree letter, follow up by land use rights certificated number 07, Desa/Kel: Ogan Komering Ilir, valid until 23/01/2039, covered area about 2,994 Ha. Issued on January 13, 2004 in Kayu Agung.

c. Head of District decree of Ogan Komering Ilir district No.221/KEP/D.PERKE/2010 dated on June 09, 2010, about license for palm oil mill development on behalf PT Sampoerna Agro located at Kerta Mukti village, Mesuji subdistrict, Ogan Komering Ilir district, with FFB capacity 120 tonne FFB/hours, with building rights use (HGB) 118.595 Ha in decree letter of building rights use (HGB) No.02 dated on 28/10/2002.

Based on hectarage statement June 2016, actual legal use od the land was: - Planted area about 2,350.79 Ha (mature area) - Nursery about 31.40 Ha - Housing about 13,70 Ha - Road about 53.51 Ha - Conservation area 53.82 Ha - Swamp area 540.21 Ha - Land dispute/enclave area about 540.21 Ha

Found some discrepancy between hectarage statement with HCV document assessment about total HCV ar-ea, wheres in hectarage statement mentioned the HCV area 24.21 Ha, while in HCV document assessment about 53.82 Ha. Estate has carried out the boundary pillars identification in February 15, 2016. Based on identification record found 25 boudary pillars in good conditioan and 80 not available on site. Companies work instruction number WI-SAG-KBN-PML-0206, procedure mentioned boundary pillars should carry out in every once year by field foreman, thorugh the clearing from shurbs, re-painting the pillars boundary, replace the missed boundary pil-lars if any. Based on boundary pillars identification on February 2016, estate has carry out the follow up



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through the memorandum letter number 0542/EHD/VI/2016 dated on June 28, 2016 about plan to replace boundary pillars missed in place. This memorandum letter explained about budget plan for boundary pillar re-placement. Based on field assessment during boundary pillars verification, to verify boundary pillars number 78, 67, 55, 01, 59, all the boundary pillars not found in field. All planted area in Division I and III demarcated by big canal with depth about 4 meter, wide 3 meter. This canal have function as a boundary also to minimize the fruit thief. Found land dispute about 540 Ha based on current existing condition work map of Hikmah 2 estate. Based on interview with operational officer, land compensation process finished in 2003, and land claimed by communi-ty was in 2005 firstly. There is no record who was claimed the company land and no record of progress of FPIC process also. This condition raised as nonconformity (NCR RSPO005 47). The company has significant land conflict in Hikmah 2 estate about 540 Ha. Company also procedure for con-flict resolution number P-SAG-RO-CAS-09 Rev 0, dated issued on August 1, 2013. Procedure complete with mechanisme for conflict resolution and person incharge to carry out the process. Procedure also complete with process flowchart mechanisme for land use rights (HGU) climed by community/external with step was:

- Persuasive process - Mediation process - Litigation process

There is no record found that the company procedure above has been communicate to all affected parties or related stakeholders. This is raised as nonconformity (NCR RSPO00548) . Found the dispute map with scale 1:40,000, wheres the dispute area about 450 Ha as mentioned above, but there is no record about documentation evidence of involvement (participatory mapping process) acceptance by the affected parties. This is raised as nonconformity (NCR RSPO00549) . Based on stakeholder interview and public consultation process, there is no record that company was used para-militaries in their operations. This criteris was not applicable. Compliance status: Non Compliance NCR RSPO00547 Found land dispute about 540 Ha based on current existing condition work map of Hikmah 2 estate. Based on interview with operational officer, land compensation process finished in 2003, and land claimed by communi-ty was in 2005 firstly. There is no record who was claimed the company land and no record of progress of FPIC process also. NCR RSPO00548 There is no record found that the company procedure for conflict resolution has been communicate to all af-fected parties or related stakeholders. NCR RSPO00549 There is no record that participatory mapping carried out by the company and the result acceptance by the af-fected parties.

Criterion 2.3: Use of land for oil palm does not di minish the legal rights, or customary rights, of ot her users, without their free, prior and informed conse nt.

Findings: The company has the SOP Free Prior and Informed Consent in prosedure Ganti Rugi Lahan dan/atau TanamTumbuh (Doc. No. P-SAG-RO-CAS-03) applies on December 2, 2013. Within the SOP described FPIC stages, those are: Identification of customary lands, Involving the community institutions, Delivering infor-mation, Ensure that the consent was given voluntarily, Guarantee that the approval was given before opera-tions, Ensure that there is an agreement, Resolve conflicts, Negotiation, Finalization of the written agreement. List of land compensation, consist of: Statement letter for right of land, letter of authority for compensation re-ceiver, statement letter form inheritee, Land Use Title (LUT), Letter of right recognition, letter of land right re-linquishment, records of land measurement, receipts, compensation (name, area, cost). Authority letter of GRTT receiver, approved by Head of village and secretary, known by head of sub district, statement letter of compensation receiving, known by head of village, letter of land right, issued by sub district, records of land inspection, known by head of village and secretary, attached with land sketch map. For example, in village of Pulau Gelonggang, Pedamaran subdistrict, Hukmah 2 Estate, on behalf of Hasan Hartawan, area of 2 hec-tares, compensate on October 2003, IDR 6,000,000.



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In interviews with the village head of Pulau Gelonggongan, Maribaya and Embacang, it was explained that there are no indigenous land or customary rights in the area of the company. Since the beginning of land ac-quisition for the construction of the estate, there is no customary land or customary rights in the area of the company. Legality of land in the community is SKT document issued by the village and sub-district head, SHM (Ownership Certificate), inherited land and the deed of land sale and purchase. Compliance status: Full Compliance

Criterion 3.1: There is an implemented management p lan that aims to achieve long-term economic and financial viability.

Findings: Estate has record of business plan for 5 years (2015 – 2019), this document covered about:

- FFB estimated production for Hikmah 2 estate for 2016 about 56,233 tonnes. - Planted area about 2,350.79 Ha - Total stand about 291,089 palm oil tree - Stand per Ha about 123.8/Ha. - Budget for maintenance such as fertilizing, spraying, harvesting, manual maintenance, road

maintenance, operational activity and others. - Based on budget record until 2019, there is no plan for replanting, because the oldest YoP still

productive. Selapan Jaya Palm Oil Mill has record of business plan for 5 years (2015 – 2019), this document covered about:

- FFB (mt) receiving projection: a. 2015 about 446,980 b. 2016 about 423,417 c. 2017 about 424,713 d. 2018 about 417,305 e. 2019 about 418,633

- CPO (mt) production projection: a. 2015 about 55,991 b. 2016 about 58,881 c. 2017 about 51,763 d. 2018 about 37,883 e. 2019 about 50,485

- PK (mt) production projection: a. 2015 about 14,493 b. 2016 about 15,046 c. 2017 about 12,575 d. 2018 about 10,388 e. 2019 about 12,551

- OER estimation 21.99% - KER estimation 5.00% - Cost of production - Forcast prices - And others

There is no record of replanting in budget plan until 2019. This is criteria was not applicable during this time Compliance status: Full Compliance

Criterion 4.1: Operating procedures are appropriate ly documented and consistently implemented and monitored.

Findings: The Standard Operating Procedures (SOPs) for Hikmah 2 estate and Selapan Jaya Mill are available as seen in Integrated Management System Procedures for Sampoerna Agro in year 2012. The SOP covers estate ac-tivities such as pre-development and planning, nursery practices, land clearing and preparation, establish-ment and maintenance of leguminous cover crops, oil palm planting density and pattern, and maintenance,



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harvesting, pest and disease management, replanting, and mulching. While SOPs for Selapan Jaya Mill is available for all operations, including the weighbridge, operation of sterilizer, loading ramp, thresher, digester, press, vibrating screen, decanter, sludge separator, ripple mill, clay bath, depericarper, kernel, boiler, water treatment plant, and for taking water samples from POME. Copy of the SOP is available at Estate and Mill and it is documented in an appropriate language (Indonesian language) During visit the field and interview to workers at estate, spraying operator has understood and implemented about SOP for chemist weeding accordance against SOP circle spraying, WI-SAG-KBN-PML-1204, Rev.1 is-sued March 16, 2012. However, during verification audit at Mill, grading worker does not conduct to Taking FFB sampling amount to 100 pieces of FFB on Grading Process, this is not accordance against Work Instruc-tion for grading, No. WI-SAG-PKS-PRS-0103. This is raised as nonconformity (NCR RSPO00550) . The company has a master list of all SOPs, namely list of document, Number document. FM-SAG-RO-SUS-010004, Rev. 1, effective date August 1, 2012 including name of document, number of document, effective date, number of revision. The company has mechanism check consistent of implementation procedure through internal audit as deter-mined on SOP for internal audit, No. Doc. P-SAG-RO-SUS-03, Rev1, Effective date June 1, 12. In the proce-dure has regulated that audit schedule once time audits per year for each department. Hikmah 2 Estate has conducted internal audit on date october 19 – 24, 2015, while Selapan Jaya Mill con-ducted internal audit on date November 4-5, 2015. Base on report of internal audit, there is no finding as Non conformity, only observation is there for estate and mill. There is evidence that verification for observation has conducted on date November 22, 2015 accordance to mechanism for corrective action for continuous im-provement as determined in SOP for Corrective action, P-SAG-RO-SUS-04, Rev1, Effective date June 1, 12 and SOP for preventive action, P-SAG-RO-SUS-05, Rev1, Effective date June 1, 12. The company maintain record of internal audit against activities at estate and mill in 2015. Example: at census for tyro alba, data recording using a form that does not valid. Compliance status: Non Compliance NCR RPSO00550 During onsite visite in loading ramp activity, the person incharge for grading process, not taking the sampling accordance to the work instruction No.WI-SAG-PKS-PRS-0103.

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

Findings: The company has SOPs for Good Agricultural Practices in managing soil fertility as presented in SOP for ferti-lizing palm, number documnet. P-SAG-KBN-PML-21 Rev 01 issued on date March 16, 2012. In These docu-ment including work instruction for anorganic fertizer application, Number Document, WI-SAG-KBN-PML-2012 Rev 0 Issued on date March 16, 2012. There is evidence that the company has conduct fertilizing in 2015 and 2016. Hikmah 2 Estate maintain record of fertilizing input 2015 and 2016 such as :

• Record of Realization of Fertilizer Consumption for Palm until December 2015: Urea = 524.851 kg, RP = 554.968 kg, MOP = 782.492 kg; Dolomite = 85.595 kg ; Borate = 27.420

• Record of Realization of Fertilizer Consumption for Palm until June 2016: Dolomite = 535 Kg, NPK = 625.141,25 Kg, RP = 7069,5 Kg, Borate = 5676,21 Kg, Urea = 109,35 Kg

The company has SOP for tissue and soil sampling as deternined in procedure for leaf and soil analysis, Number Doc. P-SAG-RST-ASE-01 Rev 0 Issued date September 01, 2009. In the procedure has regulated that leaf sampling was once a year, while soil sampling was once every five year. There is evidence that these procedure has implemented and maintained. There is record of a tissue and soil analysis such as below :

a. Report of Tissue analysis Number: 008/FQA-R&D/I/2016 by Research and Development PT Sam-poerna Agro (PT Binasawit Makmur, integrated Laboratory R & D Department), dated Issued on January 28, 2016.

b. Report of soil analysis, Number: 042/HD-EXT/XXIS/OKT/11, by PT Nusa Pusaka Kencana Re-search and Development, on date issued October 17, 2011.

The company has a nutrient recycling strategy through Empty Fruit Bunch (EFB) application. Record of EFB application is available and maintain very well in 2015 and until June 2016. Data of EFB application was re-viewed such as :



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o January-December 2015, was applied 2.029,03 ton of EFB into 42,72 Hectare o January -June 2016, was applied 9.711,37 ton of EFB into 307,27 Hectares

Compliance status: Full Compliance

Criterion 4.3: Practices minimise and control erosi on and degradation of soils.

Findings: The company has soil map with scale 1:50.000. Base on report of FCA team, Type of soil’s Hikmah 2 Estate is consist of:

- Typic Endoaquepts and Aquic Dystrudepts about 977,72 ha; - Typic Kandiudults, Typic Hapludults, Typic Dystrudepts about 1.369,07 Ha.

Hikmah 2 Estate has map of slope grade with scale 1:50.000. Base on the map, slope grade consist of : < 8% (flat) :3.067 ha, 9-15% (corrugated) : 52,44 ha and 16-25 % (rather hilly) : 0,40 ha. The company does not has a management strategy for plantings on slopes, because there is no area with slope above limit (>40%) During visit the field, there is no area slope above limit The company has a road maintenance plan 2016 including budget for road maintenance and amount of road maintenance plan. There is evidence that a road maintenace plan implemented at estate until June 2016 such as : production road : 90.680 m ; collecting road :29.550 m. Based on the results of the assessment on the EIA and HCV Document, there is no peat soil in all estate. Compliance status: Full Compliance

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

Findings: The company has a water management plan in year 2016 for estate and mill consist of source of water, loca-tion, using of source water and management for using water source. Hikmah 2 Estate already conducted identification source of water in the area. Source of water is consist of swampland and artesian wells. While at Selapan Jaya mill, there is only artesian wells. Swamp land is protected area in Hikmah 2 Estate. Artesian wells is used for spraying activities and usage daily for activities by worker. During audit, there is no record of water testing from artesian wells, but finding evidence that the company has conduct effort check through test of water quality artesian wells. For condition, auditor raise as non conformance under Principle and criteria 6.5. For protection swampland, Hikmah 2 estate conduct to install signboard that chemist apllication is prohibited. During visit field, there is evidence signboard already installed and maintained. Selapan Jaya mill use surface water for processing activies. During certificaton audit, There is permit for sur-face water usage on expiry, but there is evidence, the company conduct effort for extending the permit to the competent authority. The Company has 25 ponds for waste water treatment process. Selapan jaya mill has had a permit to dis-charge waste water on Hitam river. Selapan jaya mill conduct testing waste water periodically by enviromen-tal laboratory, environmental institution, province South Sumatera, base on report of testing waste water, there is no wastewater test results are above the threshold, this is under nonconformity in principle and crite-ria 6.5. Selapan Jaya Mill maintain amount of water usage for processing FFB every month. There is record of water usage per tonne FFB on January until June 2016. Record of water usage per tonne FFB e.g :

• January: total water consumption / tonne of FFB (process + boiler) is 1.11 M3 / ton FFB • February: total water consumption / tonne of FFB (process + boiler) is 1.19 M3 / ton FFB • March: total water consumption / tonne of FFB (process + boiler) is 1.31 M3/ ton FFB • April: total water consumption / tonne of FFB (process + boiler) is 1.17 M3 / ton FFB • May: total water consumption / tonne of FFB (process + boiler) is 0,96 M3 / ton FFB • June: total water consumption / tonne of FFB (process + boiler) is 1.22 / ton FFB

Compliance status: Non Compliance under Principle a nd Criteria 6.5



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

Findings: The company has Integrated Management System (IPM) plan in 2016 consist of early warning system (EWS)/Census pest, pest control, census Tyto alba (owl) and monitoring cage of tyro alba, maintenance ben-eficial plant (Turnera surbulata, Antigonon leptosus), pest control with use of chemical when condition of pest attack has been above threshold. The company has SOP related integrated Pest Management such as :

a. Procedure for pest monitoring, No doc. P-SAG-KBN-PML-15 rev. 1 issued on date March 16, 2012 b. Procedure for leaf pest control, No. doc. P-SAG-KBN-PML-16 issued on date March 16, 2012 c. Procedure for controlling of tirataba, No. doc. P-SAG-KBN-PML-17 issued on date March 16, 2012 d. Procedure for rat control for mature and immature oil palm, No. doc. P-SAG-KBN-PML-18 issued on

date March 16, 2012 There is evidence that IPM plan implemented and maintained such as report of census tyro alba, report of census rat etc. Base on record of the census Until June 2016, there is no attack pest has been above thresh-old. The company has been conducted biological controlling for pest attack through planting beneficial plant such as turnera surbulata and antigonon leptosus. Hikmah 2 Estate maintain record of amount beneficial plant and presented in report of monitoring of benefecial plant consist of turnera sp (65 pieces) and antigodon sp (27 pieces). The company has conducted training for IPM officer, namely training for Integrated pest management on date March 10, 2016, followed by 45 participant. Compliance status: Full Compliance

Criterion 4.6: Agrochemicals are used in a way that does not endanger health or the environment. There is no prophylactic use of pesticides, except in specific situations identified in national Best Practice guidelines. Where agrochemicals are used t hat are categorised as World Health Organisation Type 1A or 1B, or are listed by the Stockholm or Ro tterdam Conventions, growers are actively seek-ing to identify alternatives, and this is documente d.

Findings: The company has policy about application and limited pesticide usage with memo from Managing Director with document number 084/MD/VI/2013 dated June 20, 2013. The company has procedure related with pesti-cide usage for integrated pest management such as:

• Procedure of weed control for immature plant with document number P-SAG-KBN-PML-12 revision 1 dated March 16, 2012

• Procedure of weed control for mature plant with document number P-SAG-KBN-PML-22 revision 1 dated March 16, 2012

The company has set a rotation of pesticides listed in the 2016 budget such as circle weeding spray with rota-tion 3 times a year, path chemist with rotation once a year, spot spraying with rotation 2 times a year. The company has records of realization for each type of work that used pesticide. All of work result input in daily report. The company has data of herbicide usage from January until December 2015 i.e:

• Starane (floroksifir metil heptil ester 295 gr/L) as much as 84.63 liter with total application as large as 1,896.10 hektar

• Elang (isopropil amina glifosat 480 gr/L) as much as 711.36 liter with total application as large as 11,762.68 hektar

• Metsulindo 20 WP (metil metsulfuron) as much as 54,64 liter with total application as large as 3,425.85 hektar

• Topzone (paraquat dichloride) as much as 1,012.43 liter with total application as large as 3,442.69 hektar

• Garlon 480 EC (triklopir butoksil etil ester 670 gr/L) as much as 13,21 liter with total application as large as 235.71 hektar

The company has list active ingredients of pesticide and has been conduct calculation of LD50.



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The company has IPM plan which stated in monthly program. The IPM plan conducts for each pest that has been identified. The IPM plans consist of pest detection, rodent control, census of owl and nest of owl and maintenance of beneficial plant (Turnera surbulata, Antigonon leptosus, Casia cobanensis). The company re-ported the realization of IPM program in daily report. The company conduct IPM monitoring with conduct pest census every month. The company has shown plans for reduction in the use of paraquat began in 2014 until 2019. The company not used prophylastic pesticide. The company has list pesticide refers to WHO class 1A, 1B, Stockholm or Roterdam convention year 2015. The company could not show the justification of paraquat usage where the company is still using paraquat until today. It was raise as non-conformity (NCR RSPO 00551). Companies storing of chemicals well in warehouse. The company has procedure about handling of chemical/pesticide such as:

• Procedure about handling of hazardous and toxic materials with document number P-SAG-RO-PCR-05 revision 1 dated October 1, 2012.

• Work instruction about handling of fertilizer spills with document number: WI-SAG-RO-PCR-0502 re-vision 0 dated October 1, 2012.

• Work instruction about handling of pesticide spills with document number P-SAG-RO-PCR-04 revi-sion 0 dated October 1, 2012.

The company has spraying training program that will conduct in April 2016. The program has been realized in accordance with the plan that has been set. The company has certificated records of limited pesticide usage such as Mega, Lisnawati, Puspa, Inah, Nina, Rosi and Diana. The training has been conduct in 18 September 2014 by Syngenta cooperation with Pesticide and Fertilizer Monitoring Commission that valid until 18 Sep-tember 2019. Based on interview with sprayer, they are understood about spraying mechanism and risk of pesticide usage and the risk if not wearing PPE when conduct the spraying. Based on field visit at the circle chemist spraying Division 2 Block 44, the workers has been used PPE completely and the material safety da-ta sheet has been available. The company has been conduct inspection related application of environmental and safety health aspect regarding to PPE usage for each unit. The company replaces the PPE if damaged. The company has procedure about handling of hazardous and toxic materials with document number P-SAG-RO-PCR-05 revision 1 dated October 1, 2012. The company kept the pesticide at the special warehouse and not mixed with other ingredients. Storing of pesticide carried on a wooden pallet to minimize the risk of con-tamination. Based on field visit, there are not found pesticide container used for other purposes such as trash, where oil. The company does not applied aerial spray. The company has been put the material safety data sheet in ac-cordance with type of existing pesticide. The company has procedure about handling of hazardous and toxic materials and waste of mill with document number P-SAG-KBN-LMB-01 revision 1 dated January 1, 2011. The company has been conduct socialization about handling of waste material for warehouse clerk on behalf Abdullah on April 14, 2016. Based on interview, the person has been understood mechanism of waste man-agement and hazardous and toxic materials. Companies implement waste disposal by cooperation with third parties. Companies handling waste by collecting the waste in temporary storage. The Company has a list of employees who had received training of limited pesticide and has obtained a certif-icate of training so that the employee is assigned as an officer associated with pesticides. The company has been conduct periodically of medical checkup period September 2014. The company has been conduct medi-cal checkup (cholinesterase) on 27-28 May 2016 for sprayer with total of employee is 15 people. The compa-ny also conduct regularly medical checkup (height, weight, blood pressure) on 9 June 2016 with total employ-ee is 36 people. The company (mill) has been conduct medical checkup (cholinesterase, audiometric, spiro-metric) with total employee is 49 people on 27 May 2016. Based on result of medical checkup all of sprayer in normal condition. The Company has a policy that prohibits pregnant or breast-feeding women to spray and fertilize with a mem-orandum of Managing Director with the number: 0044 / MD / VIII / 2010 dated August 31, 2010. The company has list of female workers that handling pesticide. The company conduct periodic checkup for female worker to check to check pregnant and breast feeding. During field visit in Block 26 Division 2, the company doing the spraying and conducted interviews with female employees who served as sprayers where at the time of the interview there are no pregnant and breast-feeding women. Compliance status: Non Compliance NCR RSPO00551 The company could not show the justification of paraquat usage where the company is still using paraquat un-til today.



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

Findings: The company has a policy related to health and safety at work endorsed by the Chief Excecutive Officer (Marc Louette) dated July 1, 2015. This policy applies to Sampoerna Agro. The company's commitment about health and safety, such as:

• Prioritizing and do the continuous improvement of aspects of quality, environment, safety and occu-pational health and safety products.

• The optimum preventing accidents caused by conditions and unsafe acts. The policy has been written in a language that is easily understood. Occupational health and safety policy has been socialized to all employees both staff and employees of gardens and plants and third parties on July 18, 2016. The Company has P2K3 work program plans year 2016 related to health and safety. The Company has P2K3 program in 2016 that includes the socialization of health and safety to employees and third parties, first aid training to supervisor, simulated fire emergency, P2K3 meeting. The purpose of the program is to preventing work accidents with a target of zero accident. The company has been reporting of P2K3 report for first quarter year 2016 to Manpower and Transmigration on April 25, 2016 and evidenced by a receipt from the Depart-ment. Some of realization among others: Estate

• Socialize health and safety and procedures for the use and maintenance of PPE to sprayer on Feb-ruary 5, 2016

• Socialize health and safety and procedures for the use and maintenance of PPE to operator and driver on March 5, 2016

• First aid training on February 12, 2016 • Meeting of P2K3 on April 4, 2016 • Socialize health and safety and PPE to harvester on April 12, 2016 • Socialize health and safety and PPE to sprayer on May 25, 2016 • Fire emergency simulation on June 7, 2016

Mill • Monthly inspection of fire extinguisher • Environmental and health and safety inspection from January until March 2016 • Meeting of P2K3 on January 22, 2016 • Socialize of first aid for process employee, workshop, biogas, waste that has been conducted on

January 23, 2016 • Socialize of PPE and health and safety that has been conducted on February 22, 2016 for mill em-

ployee • Socialize of health and safety and material safety data sheet to process employee that has been

conducted on March 21, 2016. The company conducts health and safety inspection every month to monitoring effectiveness of health and safety plan that has been set for each unit. The company has health and safety program that stated on form FM-SAG-RO-SUS-080003 revision 1 effective date August 1, 2012. In the progress report consist of activity, target, progress, problem and corrective action. The company has procedure of environmental and health and safety aspect, aims, goals and environmental and health and safety program with document number P-SAG-RO-SUS-08 date issued 1 June 2012 revision 1. The company has identification and evaluation to preventive of work accident to all operational aspect both of estate and mill. Overall precautions have been observed to conduct inspections of the implementation of health and safety for employees, and locations in estate and mill. The company have been trained the employee to operate the work for each unit. This can be evidenced by the training records such as limited pesticide usage certificates, licenses of steam operator, K3 license lift air-craft carriers and transport, etc. Based on field visit at harvesting activity on Block 15A Division 1, chemist on Block 26 Division 2 and empty bunch application on Block 21C Division 1, the employee has been wearing PPE. Based on mill visit, there are employees and third parties who are not wearing PPE that is required if they are in the mill area; fire extinguisher do not have the pressure (workshop), welded tube does not have a safety, loader (back alarm goes off, not have a rearview mirror); the pressure of water pump does not maxi-mum at the station in the area of biogas station; LOTO system does not run when there is an improvement in boiler station; laying of hydrant box does not have a water source; conveyor is not closed permanently. It was



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raised as non -conformity (NCR RSPO 00552). In the case if the used PPE is damage, employees reported to the foreman for making an application for the replacement it’s damaged PPE to the warehouse. The company has a management structure of committee occupational safety and health (P2K3) which has been approved by the Department of Manpower and Transmigration. The company has conducted regularly meetings of P2K3 and has been reporting regularly at least 3 months. Records of the results of meetings P2K3 has been done on 19 February 2016 and 4 April 2016. The Company has emergency preparedness and response procedures in the garden with the document number: P-SAG-KBN-DRR-01 revision 1 dated March 16, 2012 (estate) and P-SAG-PKS-DRR-01 revision 0 dated September 1, 2009 (mill). The procedure has been socialized to all employees and made in Indonesian so that employees understand the actions to be taken if an emergency occurs. Both of estate and mill already has the organizational structure of an emergency control. Mill and estate also have expert safety and health as the officer responsible for the implementation of health and safety in the respective units. The company has records of training in emergency first response that was conducted in February 2015 conducted by the Association Hyperkes and Fire Control in October 2015. During field visit in harvesting activities (Division 1 Block 15A), field chemist (Block 26 Division 2), empty bunch applications bunch (Block 21C Division 1), dis-covered completeness of first aid drugs compliance with existing regulations (Permenakertrans No.15/2008). The Company has included employees in BPJS Employment. This can be evidenced by the Employment BPJS payment in May 2016, with the amount paid IDR. 122,041,003, -. The Company has been recapitulated the work accidents by using matric Lost Time Accident. Based on data from January to June 2016, there were 10 cases of accidents with total working days lost as much as 25 working days. Based on the data recording work accidents is available, it appears that the accident happened is a lightweight category and lost working days during the 25 working days from January to June 2016. Compliance status: Non Compliance NCR RSPO00552 Based on mill visit, there are employees and third parties who are not wearing PPE that is required if they are in the mill area; fire extinguisher do not have the pressure (workshop), welded tube does not have a safety, loader (back alarm goes off, not have a rearview mirror); the pressure of water pump does not maximum at the station in the area of biogas station; LOTO system does not run when there is an improvement in boiler station; laying of hydrant box does not have a water source; conveyor is not closed permanently.

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

Findings: The company has procedure about training with document number P-SAG-RO-HRS-02 revision 15 dated September 1, 2009. In the procedure stated about training plan (FM-SAG-RO-HRS-020001), form of training result (FM-SAG-RO-HRS-020001), form of training evaluation (FM-SAG-RO-HRS-020003) and form of train-ing recapitulation (FM-SAG-RO-HRS-020004). The company has been conduct training evaluation and train-ing recapitulation in accordance with procedure about training with document number P-SAG-RO-HRS-02 re-vision 15 dated September 1, 2009. The company has training plan including RSPO aspect for year 2016 i.e. HCV refreshment training, socialize the regulation compliance, occupational health, GHG training for estate and mill, IPM training, harvesting train-ing, spraying, RSPO and ISCC awareness, OSH training. The company has records of training for each employee from year 2014 until 2016. The records of training keep well by Human Resources. Compliance status: Full Compliance

Criterion 5.1: Aspects of plantation and mill manag ement, including replanting, that have environmen-tal impacts are identified, and plans to mitigate t he negative impacts and promote the positive ones are made, implemented and monitored, to demonstrate continuous improvement.

Findings: Hikmah 2 estate has EIA document (AMDAL) in 1996 by external consultant, this EIA document approved by Agriculture Department number 142/BA.5/IV/1996 dated June 18, 1996.



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The EIA document covered all activity in estate from roads building, emplacement building, land clearing ac-tivity, waste management for POME, planting process, maintaining process, planting activity, social activity, pest and diseased, and others. EIA document also mentioned about environmental description in first time before palm oil planted, i.e.: about rainfall, temperature, wind, humidity, water balance, geology, soil type (alluvial, ulticol, kambisol, gambut) with slope from 0 – 3%, hydrology, air quality, land use history, vegetation and spescies, erosion potential, social economic and culture. Then in 2004, estate revised their EIA document, approved by Environmental Official Government of Ogan Komering Ilir. This revised because Land application program plan was changed from Hikmah 2 estate to Hikmah 1 estate. Selapan Jaya Palm Oil Mill has EIA document in 1997, has been approved by Agirculture Department with approval number 025/ANDAL/RKL-RPL/BA/XII/1997 dated on December 31, 1997. The EIA document covered all activity in estate from roads building, emplacement building, land clearing ac-tivity, waste management for POME, planting process, maintaining process, planting activity, social activity, pest and diseased, and others. EIA document also mentioned about environmental description in first time before palm oil planted, i.e.: about rainfall, temperature, wind, humidity, water balance, geology, soil type (alluvial, ulticol, kambisol, gambut) with slope from 0 – 3%, hydrology, air quality, land use history, vegetation and spescies, erosion potential, social economic and culture. During certification assessment, Selapan Jaya Palm Oil Mill has new activity in place i.e.: Methane trap, but this activity didn’t covered in current EIA document, and company has been send the letter number 454/SA/VI/16/RO/GC dated on June 12, 2016 about “Permohonan Perubahan Keputusan Kelayakan Ling-kungan” or Request for Revision of Environmental Feasibility License, but until certification assessment there is no new information how the condition or response from the Environmental Agency Offical Government. This letter already submit to the official government on June 24, 2016. This is raise as nonconformity (NCR RSPO553). Hikmah 3 esate has a environmental management in place, in document of management and monitoring plan, approved by Agriculture Department number 142/BA.5/IV/1996 dated June 18, 1996. The management and monitoring plan mentioned about target, objective, method, frequency, and reported addressed. The management and monitoring plan covered about physically effect, chemical effect, biological effect, social economic culture effect, such as water quality and quantity, water species quality, flora and fauana monitoring, social economic culture, transportation, and others. Management and monitoring plan also mentioned the method how to mitigate the negative impact, timetable and others. Based on record of management and monitoring implementation report for 2015 semester I and II, the com-pany already done carrie out implementation and report to the Environmental Agency Official Government of OKI district evidenced by memorandum number 040/SUS/IV/2016 dated on April 21, 2015 about manage-ment and monitoring report submitted to the related official government. But, the report has been reported does not covered all item has been required in management and monitoring matrix document, such as soil improving fertility, wild life disturbance, community restlessness, employment opportunity agints to local community, community health problems and others. This is nonconformity raised under principle and criteria 2.1 above. While in Selapan Jaya Palm Oil Mill, has record of management and monitoring plan, this document men-tioned about target, objective, method, frequency, and reported addressed. The managment and monitoring plant covered about land clearing activity, erosion measurement, water river quality, air and noise quality, em-ployment opportunity, and others. But based on RKL RPL has been reported does not covered all items has been required in the matrix also, this is nonconformity raised under principle and criteria 2.1 above. Compliance status: Non Compliance NCR RSPO00553 Selapan Jaya Palm Oil Mill could not show new update process for revision of environmental feasibility li-cense.

Criterion 5.2: The status of rare, threatened or en dangered species (ERTs) and high conservation val-ue habitats, if any, that exist in the plantation o r that could be affected by plantation or mill mana ge-ment, shall be identified and their conservation ta ken into account in management plans and opera-tions.



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Findings: Telaga Hikmah PT, has record HCV assessment identification carried out in September 23 – 28, 2012 by Bo-gor Agriculture University, Forest Faculty. Especially in Hikmah 2 estate, based on HCV identification found HCV 4.1 (swamp area) about 53,82 Ha. Based on HCV assessment identification no found any species (flora and fauna) categorized as RTE species. Only LC categorized found. Based on HCV assessment identifica-tion, in concession company are, found 1 mammal, and 3 birds protected by national law, 5 species under CITES Appdendix II (1 mammal and 2 reptilian) and 1 mammal under Appendix III. There is no found any species categorized as VU, EN, CR accordance to IUCN Redlist. The HCV assessor used by company was qualified and registered in HCV RSPO assessor, also HCV as-sessment was performed with stakeholder consulatation carried out on September 28, 2012, attendant by 60 person from all related community and internal workers. Accordance to HCV assessment, the HCV assessment covered all planted area and legal land use rights of the company, also was identified the potential species and corridors if possible, and used the latest methodol-ogy approved by HCV netowork. HCV identification map also available in place, wheres the HCV map was overlay with planted map, scale with 1:40,000. Based on HCV assessment, there is no found and RTE species present in company concession area, as a mentioned in criteria above. Because there is no RTE species found in concession area, so HCV management plan not covered and men-tioned about this. While the HCV management plan mentioned about: - Demarcation and demarcated the HCV area along of outside boundary, through the pillars installement. - Signboard installement - Fire control - Flora and founa protection - Land cover inventarization - Enrichment HCV area During field assessment, found HCV area namely Rawa 1, set-asides with community land, but the company could not show the evidence of MoU or others agreement with local community to protect together of the HCV area. This is raised as nonconformity (NCR RSPO00554) . Compliance status: Non Compliance NCR RSPO00554 During field assessment, found HCV area namely Rawa 1, set-asides with community land, but the company could not show the evidence of MoU or others agreement with local community to protect together of the HCV area.

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

Findings: The company has identification of waste products produced and pollution sources by estate and mill. The company has an inventory of chemical containers which stated in FM-SAG-RO-HRS-050001 revision 0 effec-tive dated September 1, 2009. The chemical containers kept on hazardous and toxic waste storage. The company has permit of temporary storage for hazardous and toxic waste on behalf PT Sampoerna Agro Tbk based on Head District decree of Ogan Komering Ilir District No.660.1/02/KEP/B.LH/2014 dated January 30, 2014 valid until 3 years since issued. The company has permission the storage period as long as 180 days for the waste that has been stated. The company also has an agreement with third party for hazardous and toxic waste transportation (PT Dame Alam Sejahtera) with number agreement: 412/SA/SPK/X/2015 dated October 1, 2015 valid until December 31, 2016. The company (estate) has hazardous and toxic waste balance until June 2016 i.e.:

• Used oil: remaining balance on hazardous and toxic waste storage as much as 450 kg • Used drum: remaining balance on hazardous and toxic waste storage as much as 450 kg • Oil filter: remaining balance on hazardous and toxic waste storage as much as 24 kg • Contamination containers: remaining balance on hazardous and toxic waste storage as much as 66

kg • Medical waste: remaining balance on hazardous and toxic waste storage as much as 66 kg

The company (mill) has hazardous and toxic waste balance until June 2016 i.e.:



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• Used oil: remaining balance on hazardous and toxic waste storage as much as 2,210 kg • Used drum: remaining balance on hazardous and toxic waste storage as much as 120 kg • Oil filter: remaining balance on hazardous and toxic waste storage as much as 40 kg • Used jerry cans: remaining balance on hazardous and toxic waste storage as much as 12 kg • Bottle of ethanol: remaining balance on hazardous and toxic waste storage as much as 15 kg • Light bulb: remaining balance on hazardous and toxic waste storage as much as 5 kg

The company has procedure of Integrated Management System (IMS) about Waste Management (P-SAG-KBN-LMB-01 revision 02 issued date October 30, 2015). The procedure consists of 4R system (Reduce, Re-use, Recycle and Recovery). Management and waste disposal plan has been include about identification and monitoring the waste and pollution source and hazardous and toxic waste disposal to third parties. The com-pany has been conduct hazardous and toxic waste disposal to third parties who have licensed. The Company does not conduct burning of waste produced. Compliance status: Full Compliance

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

Findings: The company has efficiency of the use of fossil fuels and to optimize renewable energy that has been stated on management plan. The company has been conduct monitoring to the implementation of program such as:

• Calculation of fuel efficiency from biomass usage from year 2015 where the shell usage year 2015 as much as 13,550 tons and fibre usage as much as 38,668.27 tons so fuels efficiency as much as 26,932.73 litres

• Fuels usage from January until June 2016 as much as 50,660 litres with FFB process as much as 76,698 ton so the fuels usage as much as 0.66 litres/ton FFB

• Calculation of fuels efficiency from biogas usage from January until June 2016 as much as 897,125 li-tres

The company has been conduct feasibility study for construction of biogas Selapan Jaya mill year 2013 by SymGas. Compliance status: Full Compliance

Criterion 5.5: Use of fire for preparing land or re planting is avoided, except in specific situations as identified in the ASEAN guidelines or other regiona l best practice.

Findings: The Company has a policy preventing pollution of the environment and land clearing without burning (zero burning). The company has land preparation procedure with number: P-SAG-KBN-PML-01 revision 01 dated March 16, 2012. In the procedure stated that land preparation conduct without burning (zero burning). The company does not conduct land preparation with burning. This is evidenced by the record land clearing using mechanical. This policy issued for all Sampoerna Agro Group. Compliance status: Full Compliance

Criterion 5.6: Plans to reduce pollution and emissi ons, including greenhouse gases, are developed, implemented and monitored.

Findings: The company has been conducting an assessment of all polluting activities which produced emission such as fertilizer usage, fuels usage, pesticide usage and liquid waste usage. The company has documentation for all identification result. The company has list of identified significant pollutants and GHG emissions that has been stated on GHG cal-culation. The company has GHG management and mitigation plan. The GHG management and mitigation plan consists of planning and monitoring for reduce the GHG emissions program. The plan consists of goals and time periods to reduce an emission. The plan has been implemented such as methane capture, EFB ap-plication, sales of surplus power electricity to PLN, monitoring GHG. The company has records of POME



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treatment. The company has been conduct the pH measuring and has been reporting to the environment agency every 3 months. The company has a system to monitor GHG emission with used the RSPO Palm GHG Calculator version 2.1. The Company has not reported the calculation of RSPO Palm GHG Calculator version 2.1 year 2015 to RSPO. It was raised as non-conformity (NCR RSPO 00555) . Compliance status: Non Compliance NCR RSPO00555 The company has a system to monitor GHG emission with used the RSPO Palm GHG Calculator version 2.1. The Company has not reported the calculation of RSPO Palm GHG Calculator version 2.1 year 2015 to RSPO. Crite rion 6.1: Aspects of plantation and mill management including replanting that have social i m-pacts are identified in a participatory way, and pl ans to mitigate the negative impacts and promote th e positive ones are made, implemented and monitored, to demonstrate continuous improvement. Findings: PT Sampoerna Agro already has prepared a Social Impact Assessment (SIA) report. The assessment was done by third party namely Invesment Indonesia, in 2014. The assessment includes details of positive and negative social effects that may be caused by plantations and mills and documents participation of affected parties and local communities. During the assessment the company conducted several consultation and communication with relevant stake-holders. All records of communication and public consultation are available and Properly documented incorpo-rated in the report. Based on the photos and attendant lists available in the SIA report, it can be seen that the preparation of the social impact has involved community participation around the estate, such as community leaders and local village officials. The Company has some plans to decrease negative and to increase positive impacts of company exist ence.Those plans are documented in PT Sampoerna Agro Social Managing Plan (Rencana Kelola Sosial PT Sampoerna Agro). The company also monitors the social impact. Implemented from this social plan in CSR activit ies. There were records of Corporate Social Responsibility (CSR) activities for year 2015. The program covered different aspects such as training on best practices for palm oil to farmer and smallholder, contribu-tion given to community, such as road repair, school contribution. Moreover, the company also helps commu-nity around mills and estate to sprinkle water on the road that are traversed by trucks, because of dust. There was regular monitoring and management of social impact recorded in Laporan Monitoring Aspek Social (So-cial Aspect Monitoring Report). Result of SIA monitoring report was discussed with their stakeholders during stakeholder meeting conducted on December 17, 2015 to get the feedback from stakeholders. Company has reviewed the social impact plan taking into account the social problems occurring usually around company. Reviewing has occurred through stakeholder meeting. Company also has given its concern to the farmers which was done by counseling activity about how tocultivate palm oil. Compliance status: Full Compliance

Criterion 6.2: There are open and transparent metho ds for communication and consultation between growers and/or millers, local communities and other affected or interested parties.

Findings: PT Sampoerna Agro have an effective Communication and Consultation Procedure, P-SAG-HO-CA&L-08 Rev. 02 in February 1, 2016 (Communication, Participation and Consultation Procedure). The procedure co-vers the scope, purpose of the procedure, internal and external communication method, documentation and follow-up action. This Procedure has been arranged and communicated to stakeholder through stakeholder meeting. Company has special officer whois responsible to handle social issues, he is Mr. Teuku Rahadian. List of stakeholders including the local communities, NGOs, labour union, contractors and local government were available, maintained and updated. The auditor has checked the minutes of meeting of the last stake-holder held on March 20, 2016 in Hikmah 2 Estate and found the detail of it. All feedback from stakeholders and record (attendance list and MoM) were available. Compliance status: Full Compliance



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Criterion 6.3: There is a mutually agreed and docum ented system for dealing with complaints and grievances, which is implemented and accepted by al l parties.

Findings: PT Sampoerna Agro still maintains and implement a procedure integrated in the procedure Communication, Participation and Counsultation, P-SAG-RO-CAS-08 dated 1.4.2012 (Komunikasi, Partisipasi dan Konsultasi) for handling complaints, grievance and dispute. Particularly for handling complaint and land dispute, there is procedure SOP No. P-SAG-RO-CAS-09 (Penaganan Klaim dan Sengketa Lahan). Internal complaints and grievances are resolved according to the Mutual Working Agreement (Perjanjian Kerja Bersama 2015-2017). Company also has policy to protect identity reporter as mentioned in policy reporter violation PT Sampoerna Agro dated on September 27 th, 2013. On point no. 5.2 stated: “Identity Reporter will be confidential. These procedures have been communicated to all stakeholders at each mill and estates. It was noted that the re-sponses from stakeholders have been positive. During public consultation, the audit team confirmed that there were no serious complaints, grievances, and disputes at the moment. Local communities and stakeholders obey and respect the company legal rights, reciprocated by the company’s respect for their traditional rights. Company has special officer who is responsible to handle social issues, including responsible to receive com-plaints and grievances, he is Mr. Teuku Rahadian. Compliance status: Full Compliance

Criterion 6.4: Any negotiations concerning compensa tion for loss of legal or customary rights are dealt with through a documented system that enables indigenous peoples, local communities and other stakeholders to express their views through t heir own representative institutions.

Findings: Company has a procedure to identify the legal right, tradition and the people who has right to get the compen-sation SOP No. P-SAG-RO-SUS-14, dated 1-8-2012 about Evaluation and Acquisition Land Estate. And also has SOP No. P-SAG-RO-CAS-03 about implementation of land compensation and or crops grow. That procedure has taken into account the gender differences in the ability to claim rights, ownership and ac-cess to land; the difference between migrants and communities that had long existed; and the difference be-tween the proof of legal ownership and communal ownership of ethnic groups or indigenous peoples.The pro-cedure has been communicated to the stakeholders during the stakeholdermeeting. Checks on the records and interviews with the local communities during public consultation confirmed that there is no current claim on any land. Based on HCV studies and ANDAL report there are no customary rights of local community. An interview with the Chief of Local Community confirmed that they have no customary rights disputes. Compliance status: Full Compliance

Criterion 6.5: Pay and conditions for employees and for contract workers always meet at least legal or industry minimum standards and are sufficient to pr ovide decent living wages.

Findings: It was available Memorandum No. 010/MD/II/2016 on February 25, 2016 concerning the adjustment of the basic wage of monthly employees and daily permanent employees in 2016. Adjustment of the daily perma-nent employee's (KHT) basic wages in 2016 is set at the Provincial Sectoral Minimum Wage (UMSP) Prov. South Sumatra (No. 117 / KPTS / LABOUR AND TRANSMIGRATION AGENCY / 2016) that is IDR. 2,250,000. It is available memorandum No. 011 / MD / II / 2016 on February 25, 2016 regarding basic wages for casual employees in 2016, which amounted to IDR. 90,000 per day. Copies of these rules were stored by HRD in mill and estate. The Company had a Collective Labour Agreement for period of 2015-2017 that was registered in Labor and Transmigration Agency Province. South Kalimantan No. 15/C/CLA/DTKP XI/2015 on November 19, 2015. CLA have included: facilities and assistance to the labour union, recruitment, remuneration, daily working hours, exemption from the obligation to work, health care, social security and workers' welfare, health and safety, order and discipline, complaints and settlement, termination of employment. PT Sampoerna Agro has a list of employee wages. Wages document well-documented. Salary structures of



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employees are listed in the memorandum No. 027/MD/III/2015 dated March, 27 2015. Wage payment is the common term that the company needs to follow as it is compulsory required by South Sumatera Governor’s Decree in SK Gubernur No. 217/KPTS/Disnakertrans/2015, with Minimum Salary of South Sumatera Province in 2015, dated February 27 th, 2015 is amount 2.100.000 IDR,-. Standars wage is determined by South Su-matera Province Indicator. There was also the There Labour Agreement between PT Sampoerna Agro Tbk, Sampurna Agro Union, es-tablished by decree of Manpower and Transmigration No. province of South Sumatra. 146/Nakertrans/2010 (in accordance with Law 13 in 2003) which contains the rights and obligations of employees. Auditor assessed the list of workers, complete with the wage amount, date of birth, date of joining SMM, basic salary, fringe benefit or premi, additional, overtime, allowance, gross, deduction, nett), dan signature, payment slip, detailed with all allowance and deduction is available. The receipt of payment was given to all workers on the payment day.Each worker has their contract, based on Decree of Working Agreement (so called Surat Keputusan Penetapan Perjanjian Kerja Bersama) oleh Kepala Dinas Sosial, Tenaga Kerja dan Transmigrasi about registration of Perjanjian Kerja Bersama PT Sampoerna Agro (PT SA), dated November 17, 2011 which was signed by PT SA and Labour Union (PUK FSP Kep Migas dan Umum PT SA), and approved by The Of-ficer of Worker Affair. A labor policy containing subjects such as non discrimination and forced labor for both employee or contractors are socialized in agreement with those people. Worker and contractor are required by the terms of their contract/agreement to have their fair compensation. All employees even contractor have been provided with suitable housing, water supplies, medical care (clinic, including doctor, nurses and medicines and bed) and welfares by the company. Worker housing receive piped potable water which is tested regularly to ensure that it is safe for human use. The facility provided the huge water jar to store the rainfall for being used as drinking water. It is also tested regularly to ensure it is always safe for human consumption. All workers housing are also provided with free electricity. Meanwhile, there’s a new facility for employees, day care for their kids for free. The parents are recommended to bring groceries and vegetable for their kids then it is cooked by the nanny in day care. For labour law, this company has a socket book about agreement between company and labor union refer to Law No 13/2003 about Labour. In this socket book, there was rules about contract between company and la-bour, working hours, deductions, overtime, sickness, holiday entitlement, maternity leave, reasons for dismis-sal, period of notice, etc. There are some facilities from the Company to its workers, such as housing, water supplies, educational and medical. All workers, if heads of families are provided with a housing unit, equipped with electricity and piped clean water for washing and bath. There are other facilities for workers, such as policlinic, baby day care, kin-dergarten, school bus and sport facilities. But, especially for water consumption, there is no any evidence that the water has been analyzed to measure the water quality for consumption. This is raised as nonconformity (NCR RSPO00556). The company also facilitated the provision of basic food needs of workers. Many efforts were done by compa-ny:

• There is a small/traditional market which supply many basic and other needs. • In every camp (housing) there is small shop/stall which sell some needs. • There is a daily itinerant vegetable seller.

Based on interviews with some workers, they get basic food (such as rice, flour, etc) easily. The existence of that facility ensures the access of employees to the food was decent, fairly and reasonably priced. There is cooperative of Sampoerna Agro employee (Deed No. 2 on February 2, 2015), type of business: sav-ing and loan, grocery shop, and estate. There was Article of Association/Bylaws year 2014 – 2016, disturb-ance permit No. 08/PTSP-BPPM/IG/2015, Cooperative Sign Company List No. 009/PTSP-BPPM/TDP/I/2015. Every month, in date of 5, there is temporary market in housing of Hikmah II estate, merchants come to the estate. There is a market in Maribaya village in every Sunday, it’s about 2.5 km away. Compliance status: Non Compliance NCR RSPO00556 There is no any evidenced that water consumption for housing was analyzed the water quality for consump-tion. Criterion 6.6: The employer respec ts the right of all personnel to form and join trad e unions of their choice and to bargain collectively. Where the right to freedom of association and collective bargaining are restricted under law, the employer f acilitates parallel means of independent and free association and bargaining for all such personnel.



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Findings: PT Sampoerna Agro has policy regarding the recognition of freedom of association under policy: “Visi, Misi, dan Kebijakan PT. Sampoerna Agro”. The policy includes freedom of association, respect for every worker to have the right to form and to be a member of labour union. The Union and management of PT SA negotiate the Perjanjian Kerja Bersama, or Mutual Working Agreement, every 2 years, according Surat Keputusan Di-nas Tenaga Kerja dan Transmigrasi No. 146/Nakertrans/2011 dated 01.01.2011. This Agreement allows them to establish a labour union in accordance with national legislation UU No.13 2003. There was a regular meet-ing between representative of worker union and representative of management company. Minutes of some meetings were checked and the meetings found to be properly conducted. On September 12, 2015, it has been already conducted meetings between SPSA and the company, discussion agenda was about renewal plan of CLA material and discussion of urgent issues in the work unit. According to the statement expressed by the chairman of SPSA, it was explained that company has given the rights of employees, wages are in accordance with the Province Minimum Wages( UMP), providing infrastructure, providing training to workers and so on. All workers are already registered as participants of BPJS health (Health Assurance). No child labor, no discrimination against workers. In order to avoid child labor company asks Personal Identity Card (KTP) and Family Card (KK). Compliance status: Full Compliance Criterion 6.7: Children are not employed or exploited. Work by chi ldren is acceptable on family farms, under adult supervision, and when not interfering w ith education programmes. Children are not ex-posed to hazardous working conditions. Findings: PT Sampoerna Agro has a policy on child and female workers (Memorandum No. 0016/DMD/XII/2010” in 9.12.2010) signed by a Director and socialized in agreements with suppliers/contractors No one under 18 years of age is to be employed. Records of personal data of employees-age, marital status, position and rank, location of work, date of commencing employment-are kept. Checking the records per January 2016 con-firmed that no one under 18 years old has been employed-in compliance with Indonesian national legislation UU RI No.13 Tahun 2003, article 68. The Company has a policy of working age, drafted on July 21, 2015, that is the protection of women workers in working place by preventing sexual harassment and violence, as well as the protection of reproductive rights. Do not employ minors and facilitate the care of children. The policy has been disseminated to all levels of employees on January 5, 2016. The Company was also displayed the policy in the office and housing area. Based on the verification results of documents of employees list in February 2016 in mind that no employees in the company were under 18 years of age at the time of admission to work. Compliance status: Full Compliance

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

Findings: The Company has a policy of equal opportunities to obtain employment that was drafted on July 21, 2015. It was about respecting human rights, including the right of all workers to organize and conferred collectively as well as provides opportunities for equal treatment in employment. The policy has been disseminated to all levels of employees on January 5, 2016. The Company also put these policies in offices and housing. Based on the interview results with unions, it was noted that there is no discrimination against workers. Company is not discriminatory in treating workers since acceptance till work in all types of jobs. Company also has policy of opportunity similarity (include local community) which can be accessed by public, through announce board in estate office, mill office and division office. Moreover that policy is also socialized during stakeholder meeting. Policy in writing about this casse stated in document “Viission, Mission and Policy of PT. Sampoerna Agro”. Further, company also has SOP No. P-SAG-RO-HRS-01 dated on March 16 th, 2012 about recruitment the new employee. In the procedure stated to open the opportunity for every worker after passing selection process based on the capacity and capability new employee. PT Sampoerna is also committed to provide jobs for the locals, even though they are reluctant to accept. They prefer to choose the job like security. Jobs like harvester are mostly carried out by external community. Va-



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cancies are posted on notice boards in the mill/estates, and also advertised in the local news paper. A policy on equal rights regardless of race, caste, national origin, religion has been established and also socialized in agreements with suppliers/ contractors.I.e in recruiting process is open to public, no requirements of ethnic, religion, caste and gender. In addition, based on the book of Mutual Working Agreement, the company must provide religious leave al-lowance to their workers to celebrate religious holidays. There is a transparent system of holiday for workers, if they need to take their leave (as stated in Chapter V, Article 20), and to get permission to take their leave re-lated to the religious event (as stated in Chapter V, Article 21). Through interview with workers, it was confirmed that there was no discrimination on working opportunities, all workers were treated equally. Records of employee’s recruitment and their contract agreement were availa-ble. In PT Sampoerna Agro there was no migrant worker. Appraisal the worker’s performance referred to SOP No. P-SAG-RO-HRS-03 dated March 16 th 2012. PT Sampoerna Agro is an equal opportunity employer, through promotion method based on performance. The Human Resources Regional Head identifies and recommends candidates for promotion to a selection board at PT SA Head Office. Based on employee Data on February 2016, it was known that employee come from different background and social identity. The list of employee explain about name of employee, Place and Date of birth, date of recruit-ment, Employee origin, religion, education, local and non local, tribe, and position. Number of employee in OKS Selapan Jaya 215 people, Hikmah Dua Estate 711 people. For example: Employee of Hikmah Dua Estate: on behalf of Suwito, male, position : loading ramp operator, recruitmen date February 1, 2007, education Technical High School, Islam, monthly employee, Java ethnic. Based on interview result with labour union, it was known that no discrimination on workers. The company don’t treat workers in discriminative way since recruitment till working in company. Compliance status: Full Compliance

Criterion 6.9: A policy to prevent sexual harassmen t and all other forms of violence against women and to protect their reproductive rights is develop ed and applied.

Findings: The Company has a policy of preventing sexual harrasment, drafted on July 21, 2015, that is the protection of women workers in working place by preventing sexual harassment and violence, as well as the protection of reproductive rights. Do not employ minors and facilitate the care of children. The policy has been disseminat-ed to all levels of employees on January 5, 2016. The Company was also displayed the policy in the office and housing area. Results of interviews with women workers in residential of Himah 2 Estate, it was stated that there was never any incident of sexual harassment that afflicts women workers. The Human Resources Regional Head of PT Sampoerna Agro has established a policy on prevention of sexual harassment and protection of reproductive rights of its female workers (Kebijakan Pencegahan Pelecehan Seksual, Perlindungan Hak Reproduksi dan Mekanisme Penanganan Keluhan dated 13.7.2010). The policy is displayed at various locations in the mill/estate offices and socialized to the Workers in each unit. The rules have been explained to all workers to ensure their understanding. Based on the result of interview women employees, it is confirmed that that they understood the policy and knew the grievance mechanism for complaints. The company protects the reproductive rights of all women workers, by providing maternity leave and prohibi-tion for breastfeeding women to work as chemical sprayer. Female employees are entitled to be pregnant and childbirth leave of 3 months and also allowed to breastfeed for up to 6 months at least 30 minutes everyday. Based on the Collective Bargaining Agreement Book (Article 20 of Chapter V) about maternity leave, men-struation leave, pregnancy and miscarriage. While menstruation leave is suspended based onresult of meet-ings, this is due to some workers who use this excuse to not work. Checks in the field concluded no pregnant and breast-feeding women were working with agrochemicals. In-terviews with female workers confirmed that they understood the policy. Company has policy to protect claim identity. Based on complaint records, no written complaints have been submitted by employees. The Company issued a policy report about complaints of SGRO on whistle blowing system dated October 24, 2013 which is in line with the company's commitment to hold open communication and to enhance good cor-porate governance), the policy is intended to provide a forum for internal employees and external parties as-sociated with the group of companies to submit a report about the alleged of violations, violations and obstruc-tion of the company group while they aware of the incident. Provide security guarantee for those who report the violations, then he/she will be protected from acts of retaliation or victimization caused by violation report-



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ing that was done in good faith without intention to do harm. The company has gender committee, also procedure for sexual harrassement handling as explained above, but the procedure did not communicate to all level workers and also the committee could not show the work program. This condition raised as nonconformity (NCR RSPO005 57). Compliance status: Non Compliance NCR RSPO00557 The company and gender committee could not show the evidence of procedure briefing and work program.

Criterion 6.10: Growers and mills deal fairly and t ransparently with smallholders and other local busi -nesses.

Findings: It was available pricing document of FFB on April 2016 (Period II) established by the Plantation Agency of South Sumatra Province, through Letter No. 525/303-VI.3 / BUN, on April 18, 2016. The price of FFB per kg of plant at the age of 3rd year was IDR 1,496.81, at the age of 10-20 year was IDR. 1,739.95 year, its 25th year was IDR 1,562.34.FFB price is determined by a meeting, attended by the parties, such as representa-tives of the Company, Cooperative Management and Plantation Agency. FFB Price that was used now and previously has been known by the farmer / Committee of Village Cooperative Unit. Cooperatives are involved in setting the price of FFB. FFB pricing mechanism was agreed by the parties every two weeks. Price of FFB from smallholders refers to the price set by the Department of Plantation, South Sumatra Province that was issued twice in a month. Smallholders get the FFB price information directly from the Plantation Office South Sumatra Province and POM of Selapan Jaya. Selapan Jaya POM receive FFB from Village Coperative of Bina Mulya, Jaya Makmur, Bina Sejahtera. Sedya Mukti, Madya Karya Bakti SKPD2, Madya Karya Bakti SKPD 1, Subur Makmur, Permata Bunda, Sumber Sentosa, Serba Usaha, Intan, Marga Mulya, Jadi Mandiri, Ipoh Raya, Puger Mulya, Harapan Jaya. Small-holder get information of FFB price, directly from Plantation Agency, South Sumatra Province and PT. Sam-poerna Agro. Selapan Jaya POM bought FFB from supplier or independent farmer. Mechanism of FFB price complaint from external party, for example complaint from smallholder is regulated in Communication Procedure, Participa-tion and Consultation, (Doc. No. P-SAG-HO-CA&L-08) Rev. No. 2 on February 1, 2016. Based on interview with management of Selapan Jaya mill and executive board of Cooperative Village of Bina Tani Mulya, it was known that no complaint from executive board of Village Cooperative Unit and smallholder related to FFB price. The price of Smallholder’ FFB, that was bought by POM Selapan Jaya refer to FFB price decided by Plantation Agency, South Sumatra Province, which is issued twice in a month. Payment of Smallholder’ FFB was conducted every month in date of 15-20, for example FFB receive on Jan-uary, so the payment will be on January 15 – 20. Based on confession of executive board of Bina Mulya Co-operative Village. It was known that the payment of FFB never been late, always on time in date of 15 – 20 every month. Sales Documentation of smallholder’ FFB is kept in each Village Cooperative Unit. There was evidence of payment receipt of Smallholder’ FFB, Village Cooperative Unit Mulya Indah Permai on February 17, 2016 as much as 2,021,980,000 kg, worth IDR 2,367,106,134. Payment was accepted by exec-utive board of Village Coperative Unit of Mulya Indah Permai, Rotan Mulya Village. Payment of FFB was con-ducted once in a month, on date of 15-20 in accordance with agreement between company and Village Co-operative Unit. But, the company need to complete the MoU or procedure with timely manner for payment process. This is raised as nonconformity (NCR RSPO00558) . Compliance status: Non Compliance NCR RSPO00558 Company need mentioned in the Mou or procedure about timely manner for payment process between com-pany with smallholder who are supplied FFB to Selapan Jaya palm oil miil.

Criterion 6.11: Growers and millers contribute to l ocal sustainable development wherever appropriate.



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Findings: The management of PT Sampoerna Agro has strong commitment to contribute to community development and documented in Quality, Safety and Health Environmental, for Sustainable Policy (QSHES Policy), signed by the President Director. The Social Impact Assessment Report was issued. The activities planned were var-ied, such as socialization of shareholders program for the locals, aids for local teachers, free medical treat-ment for the locals, making a well for locals, etc. Contribution of sustainable development to local contractor through is based on annual stakeholder meetings. At this meeting, all stakeholders are given the discretion to exclude ideas and the problem about impact of the existence of the company. Some contribution has been awarded by companythrough CSR. Then, if there is a problem, it can be resolved by win win solution. The assistance from PT Sampoerna Agro to the community such as renovation for some items are schools, roads, bridges, e.g., Posyandu (integrated healthcare service post and health education to Promote human hygiene), sanitation, fogging, agricultural skills training for the locals (estate workers and smallholders), skills training for school teachers, scholarships available, tree planting, waste treatment for land application such as EFB for plasma estates. For example, CSR implementation on 2015: Rehabilitation of office of Sukasari Village, rehabilitation of mosque in Kertamukti Village, Ramadhan Tour in Tanjung Makmur Village, furniture procurement for SDN 2 (Elementary School) 2, Tanjung Makmur Village. Company already has CSR program on 2016, which was drafted based on result ofcommunication and con-sultation with some stakeholders, one of them is Headmaster of Junior High School * Bumi Makmur on March 29, 2015. CSR program on 2016: Sampoerna Agro Community Learning Centre, Rehabilitation for Drug Abuser, Creative Learning Method for PAUD/ Early Childhood Education, development of community work ethic based on religion and development of literasi interest and initiative of school trash bank, learning facility and independent tast for students, classroom learning facility. Local workers who work in Hikmah 2 Estate: Pulau Geronggang Village 119 peopla, Tanjung Sari Village 1 person, Pematang Village 1 person, Mataram Jaya Village 1 person, Maribaya Village 11 people, Embacang Village 1 person, Belitang Village 1 person. Local workers who work in POM Selapan Jaya : Mergo Bakti Village 3 people, Cahaya Maju Village 2 people, Kerta Mukti Village 22 people, Lubuk Seberuk Village 4 people, Embacang Village 18 people, Talang Pan-geran Village 1 person, Pulau Geronggang Village 3 people, Embacang Permai Village 2 people, Burnai Ti-mur Village 2 people, Sumber Baru Village 2 people, Tugu Mulyo Village 2 people, Bumi Agung Village 2 people, Mekar Wangi Village 1 person, Rotan Mulya Village 1 person, Mulya Jaya Village 1 person, Kayu La-bu Village 1 person, Sukasari village 1 person, Jamantras village 1 person, Sumbu Sari village 3 people. Compliance status: Full Compliance

Criterion 6.12: No Form of forced or trafficked lab our are used.

Findings: Policy of commitments not to recruit labor-traded and do not employ labor by force, it was contained in the policy of meet all customer requirements, legal requirements and other relevant legislation, which is applica-ble in local, national and ratified international. Results of interviews with HR Department and unions, it is known that all the company's workers is legal, there is no recruitment of illegal traded labor. Results of search on the list of workers in February 2016, it was noted that no trafficked labor found. The company employs a permanent worker and a daily worker. Employment contract agreement between the company and workers is in Indonesian language that is easily understood. Based on the human resources department, public consultation and interviews with several workers, there occurred never any labor trafficking. The audit team has verified and checked the letter of agreement between workers and the company. It was confirmed that the agreements were signed by both parties without any co-ercion and force, the worker entered into employment voluntarily and freely, without the threat of a penalty, and he has freedom to terminate employment without penalty if there is a reasonable notice available or as per agreement. Based on interviews with workers, there was no deduction from the company, unless the de-duction of the loan that worker asked to the Company’s Cooperative. 1). The audit team also confirmed that no contract substitution occured. There are no migrant workers and temporary workers in PT Sampoerna Agro. Result of interview with HRD dan labour union, it was known that all workers in company are legal, no traffick-ing of workers illegally, tracking result from employee list in company on February 2016, it was known no traf-ficking of workers.



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Compliance status: Full Compliance

Criterion 6.13: Growers and millers respect human r ights

Findings: The company has a policy to respect human rights. The policy is stated in Visi Misi Kebijakan Sampoerna Agro, dated 2 Mei 2015. Point 4: “Respecting Human Rights issue, included Rights of all workers to associa-tion and negotiate collectively and give same opportunity in working. This policy has been communicated to workers. Documentary evidence of socialization and communication of the policy on May 16 th, 2015 is avail-able and stored properly. Based on interview result with company, it was told that there is no human right violation. In Hikmah 2 Estate, there is one contractor or third party that is PT Damai Alam Sejahtera, transporting haz-ardous waste. It has been conducted socialization about human right on July 18, 2016, at meeting room of Hikmah 2 Estate. Compliance status: Full Compliance Criterion 7.1: A comprehensive and participatory independent socia l and environmental impact a s-sessment is undertaken prior to establishing new pl antings or operations, or expanding existing ones, and the results incorporated into planning, m anagement and operations. Findings: Based on SEIA document review, the document for SIA and EIA already cover about social impact and envi-ronmental impact assessment from palm oil development from land clearing until on going activity also after if palm oil activity end. The explanation of environmental and social impact already mentioned in NPP notifica-tion draft and still under RSPO review process. Compliance status: Full Compliance

Criterion 7.2: Soil surveys and topographic informa tion are used for site planning in the establish-ment of new plantings, and the results are incorpor ated into plans and operations.

Findings: Based on EIA and HCV document assessment, Telaga Hikmah 2 estate has flat contour. Based on field visit for planting in 2010, the slope condition was flat. Based on EIA document also mentioned that soil in Telaga Hikmah was suitable for palm oil development. Complete explenationed already mentioned in NPP draft noti-fication. Compliance status: Full Compliance

Criterion 7.3: New plantings since November 2005, h ave not replaced primary forest or any area re-quired to maintain or enhance one or more High Cons ervation Values.

Findings: Found based on hectarage statement, planted area between 2005 – 2012 about 265.78 Ha. This area based on EIA document 1996, page IV-21, mentioned that the company concession area came from forest production conversion (HPK) secondary forest, shurbs, and swamp. While accordance to LUC Analysis 2015, carried out by external consultant from Bogor Agriculture University, Forest Departement, mentioned that the Hikmah 2 estate LUC from:

Land cover condition Year/Ha

2002 2006 2007 Old thickets 27.15 0.00 261.89



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Opened land 646.79 136.69 701.03 Palm oil 2,174.47 2,436.59 2,137.94 Swamp 271.59 546.72 19.15 Shurbs 3,120.00 3,120.00 3,120.00

LUC analysis not mentioned any compensation and remediation or coefficient from every land use change in concession area. HCV assessment identification covered all area under Hikmah 2 estate, and planting since 2005 until 2012 not replaced any primary forest and HCV area. Then, some area in Telaga Hikmah 2 estate since YoP 1st January 2010 up, found area about 38.80 Ha (YoP 2010 up) and this is will under RSPO sanction for three (3) years, whereas the area and the FFB produced from that area could not claim as a certified. While YoP since November 2005 until December 31, 2009 about 226.98 accordance to the RSPO NPP pro-cedure should complie with P&C 7 requirement. And the Telaga Hikmah 2 estate already effort to complie to the P&C. Compliance status: Full Compliance

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

Findings: Based on EIA and HCV document assessment there is no undulation area in Telaga Hikmah 2 estate, so there is no found fragile and/or marginal soil in Telaga Hikmah 2 estate. Complete explanation already men-tioned in RSPO NPP notification draft and still under RSPO reviewed. Compliance status: Full Compliance Criterion 7.5: No new plantings are established on local peoples’ land without their free, prior and i n-formed consent, dealt with through a documented sys tem that enables indigenous peoples, local communities and other stakeholders to express their views through their own representative institu-tions. Findings: Based on SIA document and public consultation, there is no any information that planting since November 2005 until December 31, 2009 was reduce the local rights, or, local communities. All process for land com-pensation already finished since Telaga Hikmah get the location permit and land use rights. Compliance status: Full Compliance

Criterion 7.6: Local people are compensated for any agreed land acquisitions and relinquishment of rights, subject to their free, prior and informed c onsent and negotiated agreement

Findings: Based on SIA document and public consultation, there is no any information that planting since November 2005 until December 31, 2009 all process for land compensation already finished since Telaga Hikmah get the location permit and land use rights, and compensation process carry out by affected parties complete with land compensation evidence such as letter agreement for land compensation and photograph. The land com-pensation process already finished in 2003. And when NPP assessment carry out through PT Telaga Hikmah there is no land compansation procces found. Compliance status: Full Compliance

Criterion 7.7: Use of fire in the preparation of ne w plantings is avoided other than in specific situa -tions, as identified in the ASEAN guidelines or oth er regional best practice.



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Findings: Based on field visit in planted area with YoP 2010, there is no found any indication that land has been preapared by burned activity. Also based on public consultation also there is no any issued that land has been preapared by burned activity. Compliance status: Full Compliance

Criterion 7.8: New plantation developments are desi gned to minimise net greenhouse gas emissions.

Findings: Telaga Hikmah 2 estate under Telaga Hikmah PT was create the green house gasess mitigation and also carbon stock assessment. The mitigation already explained in P&C 5.6 Compliance status: Full Compliance

Criterion 8.1: Growers and millers regularly monito r and review their activities and develop and im-plement action plans that allow demonstrable contin uous improvement in key operations.

Findings: PT Sampoerna Agro Selapan Jaya Palm Oil Mill and Hikmah 2 estate has effort to continuous improvement for all activity in mill and estate. The first was methane trap. Then, the Selapan Jaya palm oil mill also imple-ment the IPM to control the pest and desease by biological control mechanism, such as Turnera subulata planting and Tyto alba. For community relationship, the Selapan Jaya palm oil mill and estate also has effort to maintained relationship between the communities, although some land conflict has been detected in com-pany land use rights area. In riparian managemen plan, the Selapan Jaya palm oil mill and supply based could show the evidence that they already maintain the riparian river bank thorugh the kept the riparian rivers from activity will damage the river bank. Compliance status: Full Compliance

3.2 Identified Non-conformances against RSPO P&C Re quirements, Corrective Actions Taken and Audi-

tors Conclusions

During the certification assessment, found 13 nonconformity, consist of 6 non-conformities were assigned against Major Compliance indicators while 7 non conformities was assigned against a Minor Compliance Indica-tor. For the major non-conformances, the company has taken the necessary corrective action to close most of these non-conformances, and this was verified by the audit team through checks of documents submitted by the company. For the minor non-conformances, the company has taken corrective action against these as well, and 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:

Criteria 2.1.1 (Major) Documents showing legal owne rship or lease, history of land tenure and the ac-tual legal use of the land shall be available.

NCR RSPO00546 Found some nonconformity related law and regulation noncompliance, i.e.:

- Environmental management and monitoring report for mill and estate not fully accordance to envi-ronmental management and monitoring matrix plan.

- Found some hazardous was exceed from the time limit storage time, i.e.: ex-oil/lubricant. - Found several dump truck operator did not have license accordance to the Ministry of Man Power de-

cree No.09/2010.

Correction : 1. Revised the environmental management and monitoring report (RKL/RPL) with guided to the



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RKL/RPL matrix. 2. Carry out hazardous identification accordance to the regulation No.101/2014 and No.14/2013 based

on hazardous types, and keep in hazardous store and dispose to the hazardous transport license. 3. Carry out evaluation against to the regulation about heavy equipment operator accordance to the La-

bour Ministry Decree No.9/2010 Clause 30. 4. Make request to human resource for heavy equipment operator training include for dump truck opera-

tor also. Corrective Action taken :

1. Will carry out review for every RKL/RPL report to ensure that report is comply to the matrix. 2. Will ensure all hazardous type will keep in temporary hazardous storage and ensure every hazardous

will disposed to transporter licensed with timely. 3. Will ensure every heavy equipment operator include dump truck operator will provide training and

have license. Verifcation Result : The company has submit the evidence to complie the nonconformity, i.e.:

1. Result of: - Record of local community health analysis for Hikmah 2 estate and Selapan Jaya palm oil mill

with 10 the highest deseases information inside. - Record of soil analysis - Record of wildlife monitoring result in Hikmah 2 estate - Local community income analysis. - Minutes of meeting dated on June 13, 2016 attendan by 10 person wheres this minutes dis-

cussed about RKL/RPL matrix compliance process and all the result will complete and submit in the next semester reporting to the related official government.

2. Document of: - Ex-lubricant hazardous waste disposed from Selapan Jaya palm oil mill and Hikmah 2 estate,

with document No. ADI 0002618 for mill and No. ADI 0002649 for estate. This hazardous dis-posed to PT Dame Alam Sejahtera as a hazardous license transporter on July 30, 2016 with unit transport No. T 9646 DD.

- Result of hazardous identification, whereas from the identification found 44 of hazardous type produced by Selapan Jaya palm oil mill and Hikmah 2 estate. This document also complete with retention time for store in temporary storage.

3. Document of: - Request letter No. 131/SA/HRS/VIII/2016 dated on August 03 2016 about training request fro

heavy equipment operator training. - Internal memo letter No. 0236/HRS/VIII/2016 dated on August 03, 2016. This letter mentioned

that 2 person (dump truck and hoisting crane operator) in Selapan Jaya palm oil mill will give training on September 2016.

- Internal memo letter No. 0234/HRS/VII/2016 dated on August 02, 2016. This letter mentioned that 17 person (dump truck operator) in Hikmah 2 estate will give training on September 2016.

- Document evaluation for law and regulation compliance of Selapan Jaya palm oil mill and Hikmah 2 estate.

Auditor Conclusions : Closed Date of closure: August 15, 2016 Cri teria 2.2.3 (Minor) Where there are or have been disputes, additional p roof of legal acquisition of t i-tle and evidence that fair compensation has been ma de to previous owners and occupants shall be available, and that these have been accepted with f ree, prior and informed consent (FPIC).

NCR RSPO00547 Found land dispute about 540 Ha based on current existing condition work map of Hikmah 2 estate. Based on interview with operational officer, land compensation process finished in 2003, and land claimed by communi-ty was in 2005 firstly. There is no record who was claimed the company land and no record of progress of FPIC process also. Correction :



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Carry out identification and mapping process use FPIC method against to community who claimed the com-pany concession area in Hikmah 2 estate. Company also submit record letter of statement, whereas this let-ter explained about total area company claimed by local community, when this area will bring to court by the company because this area has been compensation by the company on 2015. Corrective Action taken : Carry out verification and periodically monitoring against to total area claimed by local community, and make program to carry out FPIC process every found potential conflict will happened. Auditor Conclusions: Evidence of correction/correct ive action will be verified during next audit. Criteria 2.2.4 (Major) There shall be an abs ence of significant land conflict, unless requireme nts for acceptable conflict resolution processes (see Crite ria 6.3 and 6.4) are implemented and accepted by the parties involved.

NCR RSPO00548 There is no record found that the company procedure for conflict resolution has been communicate to all af-fected parties or related stakeholders. Correction : Carry out briefing to all related stakeholders about company procedure understanding No.P-SAG-RO-CAS-09 Rev0 date on August 1, 2013 and documented the briefing process. Corrective Action taken : Ensure every new stakeholders and all stakeholders aware and understand about company procedure, and company will provide briefing related that procedure for new stakeholder if any. Verification result: Company already submit the evidence of briefing report carried out on September 21, 2016. This briefing at-tended by 6 person from company management and 21 person from local communty. This evidence complet-ed with briefing material and photograph. Auditor Conclusions : Closed Date of closure: September 29, 2016

Criteria 2.2.5 (Minor) For any conflict or dispute over the land, the extent of the disputed area shal l be mapped out in a participatory way with involvement of affected parties (including neighbouring com-munities where applicable).

NCR RSPO00549 There is no record that participatory mapping carried out by the company and the result acceptance by the af-fected parties. Correction : Carry out identification and mapping process for company concession area claimed by the local community use FPIC process method. Company submit statement letter explain about identification process and FPIC process for company land use rights has been claimed by local community. This statement letter signed by Top Management. Corrective Action taken : Carry out verification and periodically monitoring against to total area claimed by local community, and make program to carry out FPIC process every found potential conflict will happened. Auditor Conclusions: Evidence of correction/correct ive action will be verified during next audit.

Criteria 4.1.1 (Major) Standard Operating Procedure s (SOPs) for estates and mills shall be document-ed.



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NCR RPSO00550 Durig onsite visite in loading ramp activity, the person incharge for grading process, not taking the sampling accordance to the work instruction No.WI-SAG-PKS-PRS-0103. Correction : Revise the work instruction No. WI-SAG-PKS-PRS-0103. Corrective Action taken : Ensure the work instruction will implemented in work location and carry out periodically evaluation procedure and work instruction implementation. Verification Result : The company has submit the evidence, i.e.:

- New work instruction No.WI-SAG-PKS-PRS-0103 Rev02 issued date on Auguts 01, 2016. This work instruction explain about sampling grading process in loading ramp based on FFB origin, i.e.: nucleus estate and smallholders, when the sample should take it by loading ramp officer about 100 FFB for nucleus and smallholders.

- Records of document distribution. Where’s this document explained about distribution of new work instruction to Selapan Jaya palm oil mill and withdrawal old work instruction from Selapan Jaya palm oil mill.

Auditor Conclusions : Closed Date of closure: August 15, 2016 Criteria 4.6.4 (Minor) Pestic ides that are categorised as World Health Organisat ion Class 1A or 1B, or that are listed by the Stockholm or Rotterdam Conve ntions, and paraquat, are not used, except in specific situations identified in national Best Pra ctice guidelines. The use of such pesticides shall be minimised and eliminated as part of a plan, and sha ll only be used in exceptional circumstances. NCR RSPO00551 The company could not show the justification of paraquat usage where the company is still using paraquat un-til today. Correction : Ask to Reasearch Development Department (R&D) about paraquat justification use. Corrective Action: Ask to R&D department to search others herbicide and to replace the paraquat, also make for program to re-duce the paraquat use. Auditor Conclusions: Evidence of correction/correct ive action will be verified during next audit. Criteria 4.7.3 (Major) All workers involved in the operation shall be adeq uately trained in safe working practices (see Criterion 4.8). Adequate and appropr iate protective equipment shall be available to all workers at the place of work to cover all potential ly hazardous operations, such as pesticide applica-tion, machine operations, and land preparation, har vesting and, if it is used, burning. NCR RSPO00552 Based on mill visit, there are employees and third parties who are not wearing PPE that is required if they are in the mill area; fire extinguisher do not have the pressure (workshop), welded tube does not have a safety, loader (back alarm goes off, not have a rearview mirror); the pressure of water pump does not maximum at the station in the area of biogas station; LOTO system does not run when there is an improvement in boiler station; laying of hydrant box does not have a water source; conveyor is not closed permanently. Correction : 1. Create a letter of reprimand for all wokers if found they not used PPE during on duty and also give PPE

briefing to all workers level. 2. Create a service letter request accordance to the procedure No.P-SAG-BC-TAB-02.



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3. Replace the fire extinguisher with good presure. 4. Carry out LOTO brieifng accordance to the procedure No.P-SAG-PKS-PRS-15. 5. Carry out installation identification of hydrant point in Selapan Jaya palm oil mill. 6. Instruct to workshop unit to built conveyor cover. Corrective Action taken : 1. Ensure that all level workers will use complete PPE during on duty. 2. Ensure all heavy equipment sparepart will complete. 3. Ensure the hydrant line completely installment. 4. Ensure the LOTO installment will complie to procedure No.P-SAG-PKS-PRS-15. 5. Ensure all conveyor machinery and other mechine with high risk potential will complete with cover to min-

imize the potential risk. Verification result: The company submit evidence:

1. Letter of reprimand addressed to all workers because they did not used PPE during on duty, letter No.0587/PKS SJ/VII/2016 dated on July 21, 2016.

2. Internal memo letter No.0595/PKS SJ/VII/2016 date on July 25, 2016. This letter explaine about obli-gation PPE use during duty without execption.

3. Briefing minutes of meeting to outsource workers date on August 18, 2016, attendant by 11 person outsource workers. This briefing explained about PPE obligation during on duty, complete with pho-tograph.

4. Minutes of meeting of heavy equipment maintaining process of wheel loader, whereas the heavy equipment complete with back alarm, rearview mirror, and also complete with video maintaining pro-cessing.

5. Minutes of meeting hydrant installation in Biogas station in Selapan Jaya palm oil mill on August 23, 2016.

6. Minutes of meeting LOTO installment dated on August 14, 2016, accordance to the procedure No.P-SAG-PKS-PRS-15.

7. Briefing LOTO minutes of meeting 02 August 2016, complete with attendant list evidence attendant by 37 person and briefing photograph.

8. Records of hydrant installment location in Selapan Jaya palm oil mil. There are 16 location of hydrant station.

Auditor Conclusions: Closed Date of closure: August 15, 2016

Criteria 5.1.1 (Major) An environmental impact asse ssment (EIA) shall be documented.

NCR RSPO00553 Selapan Jaya Palm Oil Mill could not show new update process for revision of environmental feasibility li-cense. Correction : Submit request letter for environmental feasibility document revision to the related official government. Corrective Action taken : Ensure all activity in mill and estate will cover in EIA document, and ensure every revision and new activity in mill and estate also cover in EIA document. Verification Result : The company submit evidence:

1. Request letter for environmental feasibility document revision with letter No.454/SA/VI/16/RO/GC dated on June 22, 2016.

2. Evidence of letter acceptance from Official Government against to the request letter. Auditor Conclusions: Closed



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Date of closure: September 20 , 2016

Criteria 5.2.5 (Minor) Where HCV set -asides with existing rights of local communities have been ident i-fied, there shall be evidence of a negotiated agree ment that optimally safeguards both the HCVs and these rights. NCR RSPO00554 During field assessment, found HCV area namely Rawa 1, set-asides with community land, but the company could not show the evidence of MoU or others agreement with local community to protect together of the HCV area. Correction : Carry out HCV briefing to all level workers and local community, and also signboard installment in HCV loca-tion area, complete with HCV boundary pillars. Corrective Action taken : Carry out HCV area boundary pillars maintainance and also develop MoU with local community to build to-gether commitment to maintain and protect the HCV area. Auditor Conclusions: Evidence of correction/correct ive action will be verified during next audit. Criteria 5.6.3 (Minor) A monitoring system shall be in place, with regular reporting on progress for these significant pollutants and emissions from est ate and mill operations, using appropriate tools. NCR RSPO00555 The company has a system to monitor GHG emission with used the RSPO Palm GHG Calculator version 2.1. The Company has not reported the calculation of RSPO Palm GHG Calculator version 2.1 year 2015 to RSPO. Correction : Report the GHG calculation result to the RSPO board. Corrective Action taken : Ensure thet GHG calculation will used GHG tools by RSPO Version 2.1 and will reported periodically every year. Auditor Conclusions: Evidence of correction/correct ive action will be verified during next audit. Criteria 6.5.3 (Minor) Growers and millers shall provide adequate housing, water supplies, medical, educational and welfare amenities to national stand ards or above, where no such public facilities are available or accessible. NCR RSPO00556 There is no any evidenced that water consumption for housing was analyzed the water quality for consump-tion. Correction : Carry out water quality analysis accordance to the Ministry Decree of Healthy No. 492/2010. The company submited result of water analysis quality certificate No.660/1166/SHU-LAB/VII/2016 date on July 15, 2016. From all 29 water quality paramters was complie to the regulation paramaters. Corrective Action taken : Ensure all water for consumption in mill and estate should be complie to the regulation. Auditor Conclusions: Evidence of correction/correct ive action will be verified during next audit. Criteria 6.9.1 (Major) A policy to prevent sexual a nd all other forms of harassment and violence shall be implemented and communicated to all levels of th e workforce.



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3.3 Description of RSPO Supply Chain Management Sys tem November 2014.

E.1 Definition

Findings: Selapan jaya Palm Oil Mill will implemented the RSPO SCCS Modul E (Mass Balance). This system will allow the palm oil mill to receive certified and uncertified FFB in one time and/or produce the certified and uncerti-fied product in the same time, and keep in the product storage tank together, but shall be control under mass balance system, to ensure the certified raw material until certified product still treace and recorded, and only certified product can be claime as a certified product. Based on information production records for 2015 and 2016 until June, the Selapanj Jaya mill has record of FFB will certified and uncertified received, whereas the certified source came from owned estate (Hikmah 2 estate), while uncertified source came from others company under PT Sampoerna Agro Tbk estate, small holders and outgrowers.

NCR RSPO00557 The company and gender committee could not show the evidence of procedure briefing and work program. Correction : Carry out briefing about sexual harassement and violance handling accordance to the internal memmo letter No.0034/MD/VII/2010 about Sexual harassement prevention and reproduction policy. Also carry briefing abut gender committee organization structure acccordance memmorandum letter No.065/MD/V/2016, and create the gender committee management work plan related women empowerment. Corrective Action taken : Ensure all woman workers has get briefing about sexual harassement and violance handling procedure ac-cordance to the memmo letter No.0034/MD/VII/2010. Ensure all workers aware about gender committee and they know how to communication with the committee, also ensure the gender commuitte work plan will implemented and recorded very well. Verification result: The company submitted the evidence of memorandum letter No.0034/MD/VII/2010 dated on July 13, 2010 about prevention of sexual harassment, and minutes of meeting of gender committee document No.FM-SAG-RO-SUS-060002 effective date on August 1, 2012, attendant by 28 person, complete with meeting agenda, result of meeting and meeting photograph. Auditor Conclusions : Closed Date of closure: August 15, 2016 Criteria 6.10.4 (Minor) Current and past prices pai d for Fresh Fruit Bunches (FFB) shall be publicly available. NCR RSPO00558 Company need mentioned in the Mou or procedure about timely manner for payment process between com-pany with smallholder who are supplied FFB to Selapan Jaya palm oil miil. Correction : Revised the SOP and MoU and added ne information about timely manner. Corrective Action taken : Ensure all MoU about FFB trading will complete with timely manner. Auditor Conclusions: Evidence of correction/correct ive action will be verified during next audit.



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In 2015 (January – December) Selapan Jaya palm oil mill received FFB from owned estate was about 18,266.560 mt, and FFB from others estate under PT Sampoerna Agro Tbk about 1,146.31 mt. Then, pro-duced product will under certified (CPO and PK) was about 3,798.415 mt CPO and 1,022.510 mt PK, with conversion factor OER about 20.84% and KER about 5.61%. Then, until June 2016, Selapan Jaya palm oil mill received FFB from owned estate was about 8,592.840 mt and FFB from others estate under PT Sampoerna Agro Tbk about 9,877.74 mt. Projection until end of December 2016, Selapan Jaya palm oil mill will produced certified product about 12,365.636 mt for CPO and 2,811.650 mt for PK, with conversion factor OER about 21.99% and KER about 5.00%. During the certification assessment process, Selapan Jaya palm mill did not claimed any certified product sold under RSPO IT platform (E-trace). Compliance status : Full Compliance

E.2 Explanation

Findings: Selapan Jaya Palm Oil Mill has record of estimated certifed products production (CPO and PK) that could po-tentially be produced from owned estate under Selapan Jaya supply based/audit scope is Hikmah 2 estate. Also, this estimation was include in long term production budget. The estimated certified production will pre-sented on the public summary in Table 4. Selapan Jaya Palm Oil Mill during the certification assessment, did not registered in RSPO IT Platform (e-Trace). Because they stil don’t have any certified transaction, and mill will registered to the RSPO IT Platform if they approve for certification. Compliance status : Full Compliance

E.3 Documented Procedures

Findings: Selapan Jaya palm oil mill has written procedures and working instruction to ensure implementation of all el-ements stated on RSPO SCCS November 2014. The procedures were updated and covering all activities. The procedure was P-SAG-PKS-PRS-14 Rev01 issued date on April 1, 2016. The procedure explained about person incharge who will responsible for SCCS implementation from mill manager, clerk, assistant manager, quality control, head of laboratory. The procedure also mentioned about jobdescrption for each person re-sponsible. Procedure also exaplained about:

- The weighbrige officer should ensure the SPB document (FM-SAG-KBN-PRD-020005) for sustaina-ble product and non sustainable product.

- Document above for sustainable product should stamp by FFB ISCC and/or RSPO. - For FFB come from sustainable estate, will check and input the data from weighbridge into sustaina-

ble system record for FFB incoming material, then the SPB document should complete with infor-mation of FFB sustainable identification, refference number, estate origin (SPB document number), unique number, GHG emission value, GHG calculation method, unit transport number (police num-ber), orygin of estate, distance estate from mill, country orygin.

- All information above, ammount of FFB, will recorded and separate between sustainable and unsus-tainable raw material and report to MR.

- All of activity related sustainable will keep for 10 years. - Quality control assisstant should ensure the certified and uncertified product and especially for sus-

tainable product will delivery, should be identified before. - In sales contract for sustainable CPO/PK, should complete with information that the CPO/PK sales is

a sustainable product. - DO document for sustainable product should complete with information: refference number, unique

number, GHG value emission, unit transport number (police number), mill origyn, quantity and quali-ty.

- Laboratory head should recorded the MB record every month (FM-SAG-PKS-PRS-140001), and this record should close every three month and should balance for sustainable product.



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- Every three month close book, the product should positive. - If any projection overpodiction for production and sales, the mill or marketing should infom to the cer-

tification body. Selapan Jaya Palm Oil Mill has carried out the SCCS training and briefing for all person incharge related the SCCS Implementation, evidence by attendant list date of July 20, 2016, total person was 6 person from Asst Qc, Weighbrigde officer, Production clerk, Weigbrigde clerk, Analyst. But not all person in charge will imple-mented RSPO SCCS has been provive the SCCS training or briefing i.e.: Laboratory head, Quality Control, Mill Manager and Comercial Department. This is raised as nonconformity (NCR RSPO00559) . Compliance status : Non Compliance NCR RSPO00559 Not all person incharge for RSPO SCCS implementation in Selapan Jaya palm oil mill has been training by the company.

E.4 Purchasing and goods in

Findings: Selapan Jaya palm oil mill has record of FFB incoming and FFB process in 2015 and until June 2016. Based production record, Selapan Jaya mill has separetly in mass balance record between FFB owned estate and outgrowers. Because Selapan Jaya mill will implement RSPO SCCS MB, so the mill not necessary separetly in mill process between certified and uncertified raw material and product, but mill shall control in mass bal-ance record. Only FFB come from Hikmah 2 estate and others estate certifed under PT Sampoerna Agro Tbk will claim as a certified. Selapan Jaya palm oil mill has mechanism to infor the CB if any over production projected through the email as a mentioned procedure P-SAG-PKS-PRS-14 Rev01 issued date on April 1, 2016. Compliance status : Full Compliance

E.5 Record keeping

Findings: Based on mass balance record template for 2015 and 2016 until June, Selapan Jaya palm oil mill has record separately between certified and uncertified raw material. This mass balance report template will evaluation every three month (three monthly basis) to ensure the certified product will always in positive, as mentionde in procedure P-SAG-PKS-PRS-14 Rev01 issued date on April 1, 2016. Procedure also mentioned only positive stock will allow to certified product deliver. During the certification assessment, Selapan Jaya palm oil did not carry out any certified product delivery pro-cess. Compliance status: Full Compliance

3.4 Identified Non-conformances against RSPO SCCS R equirements, Corrective Actions Taken and Audi-

tors Conclusions. During the certification assessment audit, there is found 1 (one) nonconformity has been identified in Selapan Jaya palm oil mill against to the RSPO SCCS November 2014. The corrective and correction action alsoe the evidence submitted by the company in 30 days. The following summaring of identified nonconformances, cor-rective and corrections taken and auditor conclusion presented below:

E.3 Documented Procedures

NCR RSPO00559 Not all person incharge for RSPO SCCS implementation in Selapan Jaya palm oil mill has been training by the company.



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Correction: Carry out RSPO SCCS training to all person incharge who responsible for RSPO SCCS implementation. Corrective Action taken: Ensure all person incharge understood very well against to the RSPO SCCS requirement November 2014, and implemented well also documented. Verification result: Selapan Jaya Palm Oil Mill has submitted record of RSPO SCCS awareness briefing carried out on July 28, 2016, attendant by 7 person from QC, QC assistant, production head, weighbridge head and officer, laborato-ry assistant. Mill also give online training through the email to the trading department for HQ in Jakarta dated of email on July 22, 2016. Auditor Conclusions : Closed Date of closure: August 15, 2016

3.5 Noteworthy Positive Components -

3.6 Issues Raised during Stakeholder Consultation M eeting

Below is a summary of issues raised by stakeholders interviewed during stakeholder consultation meeting:

No. Stakeholders Issue Raised Management Response Audit Verification

1 Mesuji Raya Selapan Jaya POM disposed waste water to environmental (Dabuk Hitam river) which result contamina-tion in river. Amount of local com-munity still low work in the company. The company has CSR realized the CSR pro-gram, but still not transparent related budget. Heavy equipment rent processing are not real-ized for 1 year.

The company has carried out waste management ac-cordance to the law and regulation, before waste water disposed to the river, waste water has fulfill the waste water quality stand-ard. The company has provide employment opportunity for local community. The company has create CSR program and also has been communicate to the local community together with local government. Heavy equipment for rent has been realized by com-pany subsidiary i.e.: Belida estate (central workshop).

Based on waste water quality analysis, all waster water parameters has fulfill by the company, and there is no indication that waste water exceed the limit. Company already transparent about vacant posiiton. The CSR program already communicated to all stakeholder related include local government. Rent process for heavy equipment already realized by the company.

2 Head of KUD Bina Sawit Sejahtera

What is the positive im-pact if smallholder fol-low the RSPO certifica-tion system.

FFB from smallholder will sustainable product, and also acceptable in interna-tional market, also small-holder get new knowledge about palm oil practice.

The still in process to carry out the RSPO certification system briefing to all smallholder.

3 Embacang If happen water con- Company has carried out Accordance to the



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village tamination in the river stream, Embacang and Balian village will get di-rect impact, because both of two village lo-cated adjacent the riv-er. There is no transparen-cy to the local commu-nity from company re-lated employment op-portunity and others in-formation. The jab va-cancy not open trans-parent. There is 1,200 Ha nu-cleus estate located in-side Embacang village area, but local commu-nity very difficult to work at company. Estate location borders by trench/canal so local community can not en-tered the company es-tate and local communi-ty should search other path to go to others vil-lage. In fact waste water dis-posed to the river. There is canal closed by company, and if rainy season communi-ty area will overflow. Request for heavy equipment from com-munity take long time response from compa-ny. Local government hope to more good relation-ship between company and community.

the waste water quality analisys every 6 month based on EIA document, and reported to the Official Government. Company always inform about vacant position if any very transparent thorugh the mading, electronic and others. The company has emplyed local community inside mill and estate include from Embacang village. The company create canal to protect company concession area and palm oil tree from thief and claimers. And the company also provide alternative road to local community to go to other village. Waste water disposed to river based on waste water quality analysis before. There is no canal closed by company. Some canal build by company to catch water. That proposal for heavy equipment borrow, still on process by CSR department. Positive response.

watse water analysis certificate result, there is no any waste water parameters exceed the limit based on regulation. And company has carried out periodically waste water sampling then report the official government. For emplyee opportunity, the company already transparent about job vacancy, if any vacant position, the company inform to the local government also install in mading. Proposal for heavy equipment borrow stil under processing by CSR department. But company will immediately inform to local community about the result.

4 Pedamaran Timur village

Employment opportuni-ty from local community not realized and local community feels hard to entered and work in the company.

The company already re-cruited local community to work with company. Some workers impose to get job with not compatible with qualification, so company

Based on employee data base, local community already recruit and work in the company.



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can not accepted. 5 Kerta Mukti

village Majority workers in the company came from others region. Clean water in Selapan Jaya palm oil mill not available. Please pay attention to employee transporta-tion from G3 to the mill.

The company used local employee. Company has deep well to flowed to the housing area and the water has been analyzed. The company did not pro-vide transportation from G3 to the mill because the company has provide hous-ing inside company location area, but the workers choose live outside com-pany area.

Based on workers data base, the company recruited local community as employee in the company. The company has provide facility such housing inside company area, but the workers did not live at the company facility.

6 Pedamaran Timur Police sector

Thank you to the Sam-poerna Agro has coop-erative to maintain the environmental safety and also thank you for the company charity helped the police office development building.

Positive response -

7 Workers Union of Sampoerna Agro

Request for workers more than 1 year to transfered to be permanent status. Please pay attention for clear water.

For transfered status to permanent workers the company follow the regulation, if the workers fulfill the requirement, it wil be permanent. The company has provide deep well and has been distributed to emplacement workers and also the water has been analyzed.

Some of temporary workers not fully attendant they absent (work day)

8 Dewi Sartika’s Kindergarden

Please provide kindegarden facilities for children.

To request for school facili-ties please submit the pro-posal to company.

The school did submit they proporsal yet, and the CSR not idenntified this condition in the CSR program.

9 Gading Raja/SP2 village

Heavy equipment re-quest borrowing for ca-nal and water catch-ment from the last year still not realized. Please pay attention to the company to em-power community land (idle land).

The proposal request has been submit to Hikmah 1 estate, and still in process by CSR department. Empower communnity land should request by local governmewnt mechanism to minimze potetntial land conflict.

-

10 Maribaya village Communities hope the company could carry out maintain the road especially on dry sea-son (watering the road),

Company has carried out road maintenance every season dry through watering the road for all road crossing by

Based on road maitenance, the company carried out road maintainance to the village roads,



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because FFB transport to the mill crossing the village road. Please to increase the CSR to all village

companies FFB transport unit. All CSR program has been budgetting and every year the CSR program always review by the cmpany to ensure the CSR prgram has realized or not.

include watering the road.

11 Land National Official Government of South Sumatra

The company active to report the land use right used.

Positive response

12 Environmental Official Government

Reporting of Environmental management was good and on time.

Positive response

13 Environmental Official Govenrment

Waste management reporting always on time. There are complaint about environmental pollution from company, and this has follow up and still on investigation process.

Positive response The company has carried out waste management accordance to law and regulation, and based on waste water analysis all paremeters are fulfill the standard.

14 Forestry Official Government

Conservation area should demarcated clear. Need to know the emission reduction. The company concessioan area was not include in forest area.

The company has carry out the demarcation of conservation area, signboard installation and also has been communicate to all workers and stakeholders. The company already calculated the GHG with GHG Calculator Template from RSPO, and also implemneted the GHG mitigation and reduction with build the methane capture to electric power.

The conservation area of the company already maintained well, and also demarcated clear and complete with signboard information. GHG also finished calculate by the company and submitted to the RSPO.

15 Labour Official Government

Reporting on time. There is no any industrial relationship between company and workers has been reported.

Positive response -

16 Estate Official Government

Reporting on time All regulation already fulfill by the company

Positive response -

17 Conservation Region

LUC analaysis from past until now still not reported by company to BKSDA, so the BKSDA

Company has carried out LUC analysis and will reported to the BKSDA.

-



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not have informatin about the LUC

18 Pulau Geronggang village

Please pay attention to local workers to be transferred to permanent workers.

Company already use local communities as workers in the company.

-

19 Maribaya village The relationship be-tween company and lo-cal community was good. There is 20 person lo-cal community from Maribaya village work in the company. There land enclave about 7 ha since 2004 on behalf Mulyono and Wirso Yusan, and cur-rent condition still under status quo, located in Pulau Geronggan vil-lage. That land not manage by company also by claimers.

Positive response Company carried out medi-ation with claimers and lo-cal government (TP3D2 team) but the claimers not accepted the mediation re-sult and until now the me-diation process still on go-ing.

-



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4.0 CERTIFIED ORGANISATION’S ACKNOWLEDGEMENT OF INTERNAL RESPONSIBILITY

4.1 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 assessment findings and report content.

Signed on behalf of TUV Rheinland Indo-nesia

Mhd Fundy C Kurniawan Lead Auditor Date : December 23, 2016



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APPENDICES

Appendix 1: Details of Certificate



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Appendix 2: List of Abbreviations

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

BPN Land used Agendy (Badan Pertanahan nasional) CHRA Chemical Health Risk Assessment CPO Crude Palm Oil CSPO Certified Sustainable Palm Oil EIA Environmental Impact Assessment ERTs Endangered, Rare & Threatened species ESH Environmental Safety & Health FFB Fresh Fruit Bunches EFB Empty Fruit Bunches GHG Green Houses Gases HCV High Conservation Value HGU Hak Guna Usaha (Land Use Rights) HIRARC Hazard Identification, Risk Assessment and Risk Control HPL Land Manage Right (Hak Pengelolaan Lahan) IPM Integrated Pest Management IK Instruksi Kerja (Work Instruction) LTA Lost Time Accident LUCA Land Usae Change Analysis MSDS Material Safety Data Sheets MB Mass Balance NGO Non-Government Organization NIB Building Identification Number (Nomor Indentifikasi Bangunan) OSH Occupational Safety & Health PKO Palm Kernel Oil POME Palm Oil Mill Effluent PPE Personal Protective Equipment PPKS Pusat Penelitian Kepala Sawit (Oil Palm Research Institute) RKL Rencana Pengelolaan Lingkungan (Environmental Management Plan) RPL Rencana Pemantauan Lingkungan (Environmental Monitoring Plan) SIA Social Impact Assessment SBU Stragtegic Business Unit SMK3 Sistem Manajamen Kesehatan dan Keselamatan Kerja

(Occupational Safety & Health Management System) SOP Standard Operating Procedure SPBUN Serikat Pekerja Perkebunan (Estate Workers Union) UKL Upaya Pengelolaan Lingkungan (Environmental Management Efforts) UPL Upaya Pemantauan Lingkungan (Environmental Monitoring Efforts)

Appendix 3: List of Stakeholders Interviewed and Co ntacted

No. Name of Stakeholder Institution - Address Remark

Stakeholders Interviewed On-Site

1. Feri Agusti Selapan Jaya palm oil mill 2. Syamsul Hikmah 2 estate manager 3. Gilang Rinaldi Sustainability assistant 4. Dedi Rewandi Field assistant 5. Nurdin Harvesting foreman 6. Radino Harvester 7. Tantowi Harvesting foreman 8. Maryono Sprayer worker of Division 2 9. Lisnawati Sprayer worker of Division 2 10. Ina Sprayer worker of Division 2



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11. Rosina Sprayer worker of Division 2 12. Diana Sprayer worker of Division 2 13. Pupsa Sprayer worker of Division 2 14. Mega Priani Sprayer worker of Division 2 15. Lina Sprayer worker of Division 2 16. Riswanto Spraying foreman 17. Dedi Upkeep foreman 18. Agus Suprianto EFB worker 19. Suharno EFB worker 20. Lukman Hakim GIS officer 21. Mika Asri HCV officer 22. Yusi Rusalina MR



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Appendix 4: Attendend list of stakeholder consultat ion meeting



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Appendix 5: Observations and Opportunities for Impr ovement

No. Observations / Opportunities for Improvement Criteria 1. -

2. -

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