Roundtable on Sustainable Palm Oil...PT Guntung Idaman Nusa Riau 2014 Unconsolidated with BSP PT...

Roundtable on Sustainable Palm Oil

1st Annual Surveillance Audit Report Report no.: ASA1_49001

Surveillance assessment against the

RSPO Principles & Criteria 2008

PT Bakrie Sumatera Plantation Jambi Unit

PT Agro Mitra Madani Palm Oil Mill and

PT Agrowiyana Plantation

Jambi Province

Date of assessment: 15 to 18 July 2013 Report prepared by: Dian S. Soeminta

(RSPO Lead Auditor)

Certification decision by: Nelly Young

(Managing Director of TUV Rheinland Malaysia)

Certification Body: PT TUV Rheinland Malaysia

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

Taman Perindustrian USJ 1, 47600 Subang Jaya,

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

www.tuv.com

TABLE OF CONTENTS

1.0 SCOPE OF ANNUAL SURVEILLANCE AUDIT 3

1.1 National Interpretation 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, tonnages and projected 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 Compliance to Rules for Partial Certification 8

1.12 Progress of associated smallholders or outgrowers towards RSPO compliance 9

1.13 (Revised) Approximate Tonnages Certified 9

2.0 ASSESSMENT PROCESS 10

2.1 Certification Body 10

2.2 Qualifications of Lead Assessor and Assessment Team 10

2.3 Assessment Methodology & Agenda 11

3.0 ASSESSMENT FINDINGS 12

3.1 Summary of Findings 12

3.2 Status of Previously Identified Non-conformities 26

3.3 Identified Non-conformances, Corrective Actions Taken and Auditors Conclusions 43

3.4 Description of Supply Chain Management System 43

3.5 Identified Non-conformances against RSPO SCCS Requirements, Corrective Actions Taken and Auditors Conclusions 61

3.6 Noteworthy Positive Components 64

3.7 Issues Raised by Stakeholders and Findings Pertaining to Issues 63

4.0 CERTIFIED ORGANISATION’S ACKNOWLEDGEMENT OF INT ERNAL

RESPONSIBILITY 64

4.1 Date of Next Surveillance Visit 64

4.2 Acknowledgements of Internal Responsibility and Formal Sign-Off by Client 64

APPENDICES 65

Appendix 1: Details of Revised Certificate (if applicable) 65

Appendix 2: List of Abbreviations 65

Appendix 3: List of Stakeholders Interviewed and Contacted 65

Appendix 4: Observations and Opportunities for Improvement 66

RSPO Annual Surveillance Audit Report

PT Agro Mitra Madani Palm Oil Mill and PT Agrowiyan a Plantation – Jambi

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1.0 SCOPE OF ANNUAL SURVEILLANCE AUDIT

1.1 National Interpretation Used

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

1.2 Type of Assessment

The 1st annual surveillance certification assessment was carried out on 15 to 18 July 2013 for 1 (one) mill and

1 (one) estate under PT BSP Jambi unit. The palm oil mill is PT Agro Mitra Madani Palm Oil Mill and the es-

tate is PT Agrowiyana Plantation owned by PT Bakrie Sumatera Plantation Tbk.

The date of the certificate issuance of PT BSP Jambi unit was on August 08, 2012.

1.3 Certification Details The details of RSPO certification of PT Agro Mitra Madani Palm Oil Mill and PT Agrowiayana Plantation are provided in the table below:

Table 1: RSPO Certification details of PT Agro Mitra Madani Palm Oil Mill and PT Agrowiayana Plantation

1.4 Location and Maps

Table 2: GPS locations PT Agro Mitra Madani Mill and PT Agrowiana Plantation included in annual surveil-

lance assessment

Name of mill / es-tate

Location GPS locations

Latitude Longitude

PT Agro Mitra Madani Mill

WKS Main Street KM.11, Tebing Tinggi Village, Tungkal Ulu Subdistrict, Tanjung Jabung District

1.040 S – 1.120 S 103.080 E –103.120 E

PT Agrowiyana Es-tate

WKS Main Street KM.11, Tebing Tinggi Village, Tungkal Ulu Subdistrict, Tanjung Jabung District

1.040 S – 1.120 S 103.080 E –103.120 E

Source : HCV Assessment document from Pollito Consulting

RSPO Membership no.: 0036-07-000-00045-07(O)

RSPO Certificate no.: 18501949001

Date of first RSPO certificate & validity: 2012-08-28 to 2017-08-28

Date of certification audit: September 19 to 23, 2011

Date of previous surveillance audit: This is 1st surveillance audit.

Date of revised RSPO certificate & va-lidity (if applicable):

No revised certificate

CPO tonnages claimed: 22,097 MT

PK tonnages claimed: 5,282 MT



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Figure 1: PT Agrowiyana Plantation and PT Agro Mitra Madani Mill in Jambi Province, Indonesia

Figure 2: Map of PT Agrowiyana Plantation

PT Agrowiyana & PT Agromitra Madani Mill



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1.5 Organisational Information / Contact Person

Contacts details of the company are provided in following table:

1.6 Description of Supply Base

PT Agro Mitra Madani (AMM) mill is one of the palm oil mills owned by PT Bakrie Sumatera Plantation

Tbk in Jambi. PT AMM mill was established in 2001 with installed production capacity of 60 tonnes/hour

accordance with the legal regulation of ‘Keputusan Badan Penanaman Modal dan Promosi Daerah

(BPMPD) or the Investment and Regional Promotion Board Decision - Jambi Province No.

15/07/1/PMDN/2001 (dated March 20, 2001) . Currently, PT AMM mill receives supplies from a compa-

ny-owned estate using smallholder schemes with total smallholder’s members of 4,576, and also from

independent outgrowers and trading. The composition of the FFB supply is 40 % from company owned

estates, 59% from smallholder scheme, and 1% from independent outgrowers.

Table 3: FFB Supply Information for PT Agro Mitra Madani for year 2012 to June 2013

FFB Contributors

Year 2012 Jan - June 2013

ton % ton

%

I. Company Owned Estates

Divisi I

17,912 - 7,700 -

Divisi II

17,155 - 7,378 -

Divisi III

19,535 - 7,992 -

Divisi IV

18,986 - 7,671 -

Company Name : PT Agro Mitra Madani Mill and PT Agrowiyana Plantat ion

Address : 1. Jakarta : Complex of Resuna Epicentrum Bakrie Tower, 18th -19th floors, HR Rasuna Said Street – Jakarta Province 12960

2. Jambi : Kol.Pol. M.Thaher Street, RT 33 RW 10 No.1A/2A Tambak Sari Village, Jambi Selatan Subdistrict – Jambi District

3. Mill: WKS Street KM.11, Tebing Tinggi Village, Tungkal Ulu Subdis-trict, Tanjung Jabung Barat District, Jambi Province

Contact Person : Efdy Ruzali

Vice Leader RSPO Group Bakrie Sumatera Plantation

Telephone : 1. Tel : 021-29941286-87, Fax : 021-29941752

2. Tel : 0741-35334, Fax : 0741-26338

3. Tel : 0741-35334, Fax : 0741-26338

Email : [email protected] ; [email protected]; /[email protected]



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Divisi V

18,084 - 7,442 -

Divisi VI

12,002 - 5,096 -

Sub Total

103,674 39.26 43,279 40.09

II. Smallholders Scheme

Plasma Pirtrans 53,411 - 19,842 -

Plasma KKPA (KUD Swakarsa) 28,935 - 14,804 -

KUD Suka Makmur 73,665 - 29,502 -

Sub total 156,011 59.84 64,148 59.43

III. Independent Smallholder 4364 0.9 502.57 0.46

Total 264,049 100 107,930 100

Certified CPO and PK still not claimed as certified, company has not contract yet for CSPO and CSPK claim.

1.7 Actual production volumes, tonnages and project ed outputs.

Table 4: Certified tonnages claimed, certified tonnages purchased or sold, total and projected CPO and PK production from PT Agro Mitra Madani.

1.8 Dates of Plantings and Replanting Cycles The company follows a replanting cycle of 25 years. Information on the dates of plantings is provided in the ta-ble below. Table 5: Age and year of plantings of company estate supplying to PT Agro Mitra Madani

Age & Year of Plantings Oil palm planted area at each estate(ha)

I II III IV V VI TOTAL

0 - 5 yrs (2009 – 2013) 0.00 0.00 0.00 0.00 0.00 0.00 0.0

5-10 yrs (2004 – 2008) 0.00 12.42 0.00 3.05 545.70 0.00 561.17

10-15 yrs (1999 – 2003) 12.15 123.68 3.02 321.98 86.15 49.70 596.68

Amount (MT) Year

2012 Amount (MT)

Until June 2013 CPO PK CPO PK

Certified tonnages claimed 22,097 5,182 22,097 5,182

Certified tonnages sold* - - - -

Certified tonnages purchased* - - - -

Actual Production* 52,679 12,594 21,284 4,444

Projected output for next 12 months 73,776 15,809

79,380

16,920



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15-20 yrs (1994 – 1998) 720.08 656.35 790.00 496.85 131.03 465.40 3,259.71

20-25 yrs (1989 – 1993) 0.00 0.00 0.00 0.00 0.00 0.00 0.0

25-30 yrs (1984 - 1988) 0.00 0.00 0.00 0.00 0.00 0.00 0.0

TOTAL 732.23 792.45 793.02 821.88 762.88 515.10 4,417.56

No planned and actual oil palm replanting activities for PT Agrowiyana Plantation have been carried out

since all planted area of the estates are still below 20 years old. The company’s first replanting program is

planned in year 2017.

1.9 Area of Plantation (Total, Planted and Mature)

Table 7 : Oil Palm Planted Area Summary, FFB Production and Average yield/ha for PT Agrowiyana Plan-tation

Estate Name Total area

(ha)

Oil Palm Planted area

(ha)

Mature (Production)

area (ha)

Immature (Non-production)

area (ha)

FFB Production

(tonnes)

Average yield/ ha

Agrowiyana plantation

4,686 4,417.56 4,417.56 - 103,674 23.46

TOTAL 4,686 4,417.56 4,417.56 - 103,674 23.46

Table 8 : Land use data for PT Agrowiyana Plantation

Estate Name Total area (ha)

Oil Palm

Planted Area (ha)

HCV &

Potential HCV ar-eas (ha) *

Land used for other purposes (ha)

Local

Government office

Nursery Cleared

Area Other Land

Agrowiyana Plantation

4,686 4,417.56 225 12 23.82 78.23 154.53

TOTAL 4,686 4,417.56 225 12 23.82 78.23 154.53 Note: * Potential HCV area due to a part of plantation area is depth peat soil > 3 m and has been planted

1.10 Progress Against Time Bound Plan PT Bakrie Sumatera Plantation Tbk as holding company has revised their time bond plan because several plantation units have been unconsolidated with BSP, the revised timebound plan is provided in the following table: Table 7: Time Bound Plan of the Other Management Units Under PT bakri Sumatera Plantation Tbk.

Name of Holding Location Time bound

plan for certific ation

Remarks

PT Bakrie Sumatera Plantation Kisaran (PT Agromitra Madani.)

Kisaran, North Su-matera

Certified on 16 June , 2010

-

PT Agrowiyana Plantation Jambi Certified on May 2012.

-



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PT Bakrie Pasaman Plantation Pasaman, West Sumatera

Finished Final Audit

Initial planned year 2011

PT ARBV South Sumatera Initial planned 2012

Unconsolidated with BSP

PT Graha Dura Leidong Prima Riau Initial planned 2015

Initial planned year 2013, waiting for PT

Bakrie Pasaman Plantation’s issuing

certificate PT Guntung Idaman Nusa Riau 2014 Unconsolidated with

BSP PT Indogreen Central Kalimantan 2015 Unconsolidated with

BSP

1.11 Compliance to Rules for Partial Certification

Compliance of the uncertified management units of PT Bakrie Sumatera Plantation against the rules for partial certification according to RSPO Certification System clause 4.2.4 has been assessed by review self assessment report submitted to TUV Rheinland. A summary of findings is provided below.

Partial Certification Requirements Audit Findings

(a) The parent organization or one of its ma-jority owned and / or managed subsidiaries is a member of RSPO.

The parent organization of PT Agromitra Madani and PT Agrowiyana plantation is PT Bakrie Su-matera Plantation Tbk. With RSPO member no. 1-0036-07-000-00045-07(O)

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

Any revision to the time-bound plan or to the circumstances of the company shall cause the plan to be reviewed for whether it is still appropriate, such that changes to the time-bound plan are permitted only where the or-ganisation can demonstrate that they are justified.

PT Bakrie Sumatera Plantation Tbk has revised the time bound plan as determined in the table 7 above. The revision due to some of company be-longs to Sumatra Plantation Group hav been sold to others plantation company.

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

According to information from BSP Management, there is no replancement of primary forest or any area identified as containing High Conservation Values (HCVs).

(f) Land conflicts, if any, are being resolved through a mutually agreed process, e.g. RSPO Grievance procedure or Dispute Set-tlement Facility, in accordance with RSPO criteria 6.4, 7.5 and 7.6.

According information from BSP Management and interview with local communities surrounding com-pany’s area, they have good relationship and there were no conflict appears relating to land dispute.

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

No labour dispute in PT bakrie Sumatera Plantation Group.



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

Some legal compliance are identified, this is be-come non conformities for each plantation unit which was included in the report of Kisaran Palm Oilo Mill, PT BSP Unit North Sumatera.

1.12 Progress of associated smallholders or outgrow ers towards RSPO compliance

The company has no planning for smallholder or out grower toward RSPO compliance, this is raised non conformities as explaince on the section RSPO Certification Requirement 4.2.3 pages 56.

1.13 Approximate Tonnages Certified The approximate tonnages certified shall be the same as per the original certificate, which is as follows Crude Palm Oil (CPO) : 22,097 MT Palm Kernel (PK) : 5,182 MT



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2.0 ASSESSMENT PROCESS

2.1 Certification Body PT TUV Rheinland Indonesia is member of Group TÜV Rheinland Group, a global leader in independent test-ing and assessment services. The TÜV Rheinland Group was established in 1872 with offices located in over 490 locations in 62 countries on all five continents. PT TUV Rheinland Indonesia offers certification for a wide range of management systems according to established international standards including ISO 9001, ISO 14001, OHSAS 18001, SA 8000, as well as CDM Validations and Verifications. PT TUV Rheinland Indonesia’s office is located in Jakarta.

2.2 Qualifications of Lead Assessor and Assessment Team The assessment team members of this surveillance audit that were part of the same assessment team for the certification audit are as follows: 1.Dian Susanty Soeminta 2.Fadli New assessment team members that were not part of the previous assessment team are as per the table be-low:

Name Position Qualifications / Experience

Dony Auditor

Education: Master Degree in Rural Sociology, Bogor Agriculture University Training attended: Susatainable Forest Management, Workshop for up-grading of Susatainable Forest Management, Technical assisstance for rural farmers, Jurnalistick training. Work experience: Experienced in RSPO auditor, Sustainable Forest Man-agement auditor, free lance on National Development Planning Agency of Indonesia, free lance on State Minister for Accleration Development Back-word Regions, free lance on Ministry of Public Work, in 2006 – 2007 work fro JICA and UNDP

Wahyu Wigianti

Auditor

Education: Master Degree of Agribussines Management, Bogor Agriculture University Training attended: IRCA ISO 9001:2008 (QMS), IRCA ISO 14001:2004 (EMS), Timber Legality Verifcation (SVLK), OHS-MS (SMK3), ISPO Auditor Course, Chain of Costudy (COC) Auditor Training. Work experience: Experienced in Professional Forester at Asosiasi Pengu-saha Hutan Indonesia, Communication Manager of the Borneo Orangutan Survival Foundation, Professional Consultant in Forestry Sector, Auditor for QMS, EMS, SVLK and ISPO until present

M. Fundy Auditor

Education: Master Degree in Natural Resource and Environmental Man-agement, Bogor Agriculture University Trainings attended: Environmental Impact Assessment (EIA), Ecological Risk Assessment (ERA), Internal Quality Audit Training for Quality Manage-ment System, IRQA-QMS ISO 9001:2000, High Conservation Value (HCV), RSPO Lead Auditor Course, ISPO Auditor Course, Timber Legality Verifica-tion (SVLK) Working experience: Experienced in Environmental Impact Assessment, En-vironmental Health Safety Senior Officer (EHS-Officer) in Wilmar International Plantation, Internal Auditor for Wilmar International Plantation, Auditor for Rountable on Sustainable Palm Oil (RSPO), Indonesian Sustainable Palm Oil (ISPO), Certification for Timber Legality Verification (SVLK) in PT TUV Rhein-land Indonesia since June 2012 – present.



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2.3 Assessment Methodology & Agenda The 1st surveillance assessment was conducted on July 15 to 18, 2013 based on the assessment program de-scribed below. The assessment was carried out accordance to PT TUV Rheinland Indonesia’s RSPO audit procedure and the RSPO Certification Systems document. During the assessment, the qualified TUV Rhein-land assessors used the RSPO standard of the country where the assessment taking place and the findings were recorded. Because of the proximity of the estates and the management systems, both of field and document assess-ments of all estates and the mill was possible to be done within the time frame without compromising the integ-rity of the assessment. One estate and one mill were visited and the assessment team carried out field and document assessments accordance to the RSPO principles and criteria. The management systems were identified and specific evi-dence was recorded for individual estates. Interviews were also conducted at the estate and the mill. The company proposed the correction and corrective action for all identified non conformities raised to the cer-tification body 30 days after the closing meeting. Verification of closure of major non-conformances was con-ducted 2 months after the closing meeting of the main assessment and implementation of corrective actions for minor non-conformities will be verified during the next suriveillance audit. The certification assessment agenda is as explained below.



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1st Surveillance audit Agenda

3.0 ASSESSMENT FINDINGS

3.1 Summary of Findings

Date Location/ Main sites Main activities

15.07.2013 PT AMM MIll

Verification previous audit finding • Opening Meeting. • Introduction of team members and assessment agenda • Presentation from Bakrie Sumatera Plantation Unit Jambi management • Document review from all aspects • Checks of documents and relevant mill include EIA, SIA & OSH docu-ment • Document of legal compliance : legal company and equipment li-censes

16.07.2013 PT AGW • Plant tour to the whole area of POM to checking the implementation of PPE, OHS and waste handling

• Interviews with mill workers from engine room, wastewater treatment plant, security post, tractor driver, and workshop.

• Checking of chemical stores and hazardous waste stores • Document of legal compliance : legal company, legal permit, and legal

boundaries. • Company’s management plan: long term business plan and forecast ex-

traction OER, information financial, and forecast prices (prices FFB and CPO) .

• Social Aspect Document Review & SIA document • Conflict Resolution Procedure, Procedure of Handling Complaints, HCV’s,

Wages, List of Stakeholder, List of Contractors, Health & clinic

PT AMM MIll

SCCS

17.07.2013 PT AGW • Environmental and social aspect document review • Legal compliance : legal company, legal permit (HGU), legal boundaries

and permit of equipment. • Labour union, female worker, health & clinic. • EIA, SIA, OSH. Procedure Communication, Conflict Resolution Procedure,

Procedure of Handling Complaints, HCV’s, Wages, List of Stakeholder, List of Contractors.

• Interview with female sprayers/maintenance workers, and Division 5 of-fice’s estate.

• Children’s crèche, housing, barn owl boxes, washing area for chemical spraying equipment at Division 2 estate.

Company’s management plan : long term business plan and crop projec-tion (FFB yield trends), information financial, and forecast CPO’s prices

18.07.2013 PT AGW • Environmental aspect: energy efficiency, waste & water management

• Continue review of document

• Environmental : chemical and fertilizer store, river buffer zones, peat planted areas and water subsidence monitoring points

• Closing Meeting



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The following is a summary of findings during this surveillance audit for the criteria listed in the RSPO Princi-ples & Criteria Indonesian National Interpretation year 2008.

Principle 1: Commitment to transparency

Criteria assessed: CR1.1, CR1.2 Criteria not assessed: - Findings: A standard operation procedure for handling incoming request of information and its response as ex-plained on AG-SM-MR-24 rev 01 dated September 27, 2011 regarding the Procedure Communication, Consultation and Participation was available accordance to the company’s commitment to provide ade-quate information to all relevant stakeholders on environmental, social and legal issues relevant to RSPO Criteria. All information request document were available based on recapitulation of the incoming letter period of year 2011 to 2013.(i.e. until June 2013). The incoming letters were dominated by request of donation ra-ther than information related to company’s information on legal documents, AMDAL, and management plans. The records of the company’s response were available in the log book. The company has established mechanism to maintain the relevant records periodically related the record of information request and re-sponses to information requests; this was raised as a non conformity. Some company’s document regarding the environmental issues and social issues (e.g. land legal docu-ment, environmental documents (AMDAL/UKL-UPL & RKL-RPL), social documents, health & safety plan and continual improvement plan management) were found made publicly available or provided based on request. Compliance status: Full Compliance Principle 2: Compliance with applicable laws and re gulations

Criteria assessed: CR2.1, CR2.2, CR2.3 Criteria not assessed: - Findings: CR 2.1 Some evidence regarding the legal compliance were found (e.g. the company has delivered hazardous waste to CV Surya Jaya Logam (licensed hazardous waste collector) based on decree of Ministry of Envi-ronmental Number 53/2011 regarding license for collecting of hazardous waste (i.e. oil and grease) to CV Surya Jaya Logam. The license (i.e. Governor Province of Jambi Decree Number 07/BPMD-PPT-4/2013) is valid for 5 years started from March 28, 2011. Furthermore the license for collecting accu (also nown as hazardous waste) was available during audit. The license is valid for 5 years started from February 25 2013. CV Surya Jaya Logam also has license for transporting the hazardous waste issued by Ministry of Envi-ronmental of Indonesia Number B-10881/Dep.IV/LH/11/2011 dated November 22, 2011 and valid for 1 years. , when the audit conducted the licensed is not valid. Based on that licensed, unit (vehicle) can be transport is unit with number BH 8535 MK and BH 8419 AO. The company also has a license for storaging hazardous waste (i.e. oil, accu, glove contaminated, cotton waste, filter oil and mercury lamp)based on Decree of Environmental Bodies Number 660/688/BLH dated October 02, 2012 with retention storage is 90 days, valid for 3 years. Furthermore the company received a permit revision regarding the hazardous waste retention storage, and based on Decree of Environmental Bodies Tanjung Jabung Barat Regency Number 660/551/BLH dated June 24, 2013 regarding the tempo-rary hazardous waste retention storage, PT Mitra Agro Madani has revised permit for storaging the haz-ardous waste to 180 days, and this letter valid from June 2013.



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Based on hazardous waste transportation record, the hazardous waste were collected more than 90 days storage, i.e.:

1. Minutes of meeting hazardous waste on Thursday, April 18, 2013 regarding the hazardous waste of oil 1,324 litter (7 drum) and accu 23 pcs, with hazardous waste manifest number 0000179 on April 18, 2013 with unit (vehicle) number in BH 8535 MK

2. Minutes of meeting hazardous waste on Monday, December 17, 2012 regarding the hazardous waste of oil 1,188 litter (6 drum) with hazardous waste manifest number 0000143 on December 17, 2012 with unit (vehicle) number in BH 8419 AO.

According to the record above, hazardous waste delivered is more than 90 days refering to hazardous waste manifest on December 17, 2012 and April 18, 2013, furthermore the number of waste transporter unit i.e. BH 8535 MK and BH 8419 AO was not valid. The company has a record of efforts have been made to comply the regulation with the evidence as fol-low:

1. Update the regulation Number 32/2009 for replace regulation Number 23/1997 2. Update the government regulation Number 27/2012 for replace regulation Number 27/1999 3. Update the government regulation Number 50/2012

List of Law and Regulation Form No.AG-SMM-P-S-03 dated January 10, 2013 has been prepared, but ev-idence (e.g.minutes of meeting and attendance list) was not available.. Accordance to the company pro-cedure Form No: AG-SMM-P-S-03 Rev 01 Date Issued September 27, 2011 regarding the law and regu-lation, in page 3, point 6.2.4 “Should new regulation exists, the copy must be provided to Head of CA and Legal Department and shall superseede the previous version of law or regulation listed in the database”, however the record of withdrawal or validiti check of the law and regulation was not available. In addition, the delivered hazardous waste from the central store to the hazardous warehouse in mill was storaged almost 2 month, where the central store that was not licensed for hazardous storage (related to CR 5.3.1 minor). The company use the registered chemical based on Pesticides Book issued by Pesticides Commission, Directorate General of Estate, and Ministry of Agriculture of Indonesia 2012. But the company did not use chemical recommended by the Ministry of Labour c/q Labour and Transmigration Offices associated with the use of chemical in the workplace (related to CR 4.6.1 major). The record of JAMSOSTEK (work insurance) for all wokers for month of April, Mei, and June 2013 was not available. (related to CR 4.7.1 minor) The licenseof the boiler operator was not valid (i.e. the lisence was valid until December 31 2012). Some workers were not using the PPE , e.g. the welding activity above ground - 2 meters was not using safety belt.(related to CR 4.6.7 minor). In addition,workers of CV AMS was under age (related to CR 6.7.1 major). During the surveillance audit, there was no revision of the document regarding the rights to use the land, the certificate of HGU still valid and the company can show the certificate. The company had an effort to maintan the boundry of HGU based on the record of monitoring from all Di-vision that has done on July 2013. Boundry monitoring has been performed once per month by each divi-sion while the result was reported to the head office. There was new conflict related to land dispute between company and village. The new conflict was land claimed by some members of the community around 47 Ha to PT Agrowiyana. Based on letter from the NGO’s P2KN Jambi Province dated October 15, 2012, and the copy of principal permit of PT Agrowiyana, the conflict should be completed by the landowners. During the surveillance audit on July 2013 the conflict was still in process. Based on the case above the company chosed conflict resolution through legal department, because land acquisition process was done. And company has decleared the problem of land dispute with others stakeholder through the pro-gram “sagu hati” (compensation process). The record of land acquisition in 1993 by PT Agrowiyana was available. The report has statement ot number, landowners, addreses, location, Ha for acquisition, and amount of compensation, furthermore the the letter was signed by landowners.



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For land acquisition resolution, the company has effort by conducting discussion with every stakeloder and facilitated by the Local Government. In the case of the conflict can not be resolved, the process will be finished through law process in law court. Based on the EIA document 1996, social impact assessment document 2011, HCV assessment 2011, and interview result from the community in Kuala Dasal and Purwodadi village; there was no traditional owner in the HGU of the company. Compliance status: Non Compliance NCR No. 2013 – 01 until 3 of 29

1. he hazardous delivered more than the 90 days based on manifest record December 17, 2012 and April 18, 2013 was found. (This is raised again as a non conformity).

2. There is found that the CV Surya Jaya Logam licensed of hazardous waste transportation is not valid during the surveillance audit.

3. There is found that the delivery hazardous waste from the central store to hazardous warehouse licensed in the mill is almost 2 month

4. There is found that the chemical in the estate does not have recommendation licensed from La-bour and Transmigration Head Offices

5. There is found that the licensed of operator for heavy equipment is not valid when they work 6. There is found that the contractor workers of CV AMS is under age 7. There is found that the regulation update is no complie with the company SOP’s AG-SMM-P-S-

03 Rev 01, page 3 ponit 6.2.4.

Principle 3: Commitment to long-term economic and f inancial viability

Criteria assessed: CR3.1 Criteria not assessed: - Findings: Both PT Agrowiyana plantations and PT Agro Mitra Madani mill have management plans (budget and strategic plan) for a 5-year period (2011-2015). Among others, information on company activities availa-ble on this document include Total Revenue, Total Operating Cost, profit/loss before and after tax. The company has a financial schedule for yearly budget. Information contained in the document includes gen-eral plantation routine operational activities such as field maintenance, harvesting, fertilizer application, investment plans such as enrichment planting (planting of various plant species to enhance biodiversity), while mill activities/data include fresh fruit bunches (FFB) processing, projected oil extraction rate (OER) and kernel extraction rate (KER). Company has clear and detail planning information for RKL/RPL (Envi-ronmental management and monitoring plan) activities and management and monitoring plans for social impact and HCV. It was verified budget document for operational activities such as mill and estate opera-tional and non operational activities asuch as General & Affair expenses activities, including budget for environmental monitoring, safety compliances, maintenatnce program, social issues for year 2013, for next 3 year all activities has been included and increase 10% every year. But for fertilizer application in 2012 is no applicated because there is no record to be found for this activity this is raised as non conform-ity PT Agrowiyana implements a replanting cycle every 25 years, and company’s plan for replanting activities is planned to begin in year 2017. Compliance status: Non Compliance NCR No. 2013 – 04 of 29 Theres is no found record for fertilizer application in 2012 based on budget fertilizer in 2012 (related to CR 4.2.2 minor)

Principle 4: Use of appropriate best practices by g rowers and millers

Criteria assessed: CR4.1, CR4.2, CR4.3, CR4.4, CR4. 5, CR4.6, CR4.7, CR4.8 Criteria not assessed: -



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Findings: CR4.1 Both of the PT Agrowiyana Plantation and PT Agro Mitra Madani has standart operating procedures (SOP’s) from land clearin actvity, planting oil palm, fertilizer application, spraying, pest integrated man-agement system’s, harvesting, FFB delivery, grading, reception of FFB, dipatch of CPO and PKO, and during the surveillance audit all of the SOP’s still valid and no changes there’s SOP’s. Both company, has a operational record and maintaned very well for the estate and mill such as FFB de-livery records, FFB grading reports and process daily reports. When the evidence example is from daily record:

1. Press station on Monday June 17, 2013 was recorded the temperature of digester about 85 – 95oC 2. Clarification station on Monday June 17, 2013 was recorded the temperature CST (continuous set-

ting tank) about 90 – 95oC 3. Oil tank temperature on Monday June 17, 2013 about 85 – 90oC 4. Clarification station on Thursday January 3, 2013 the temperature of (CST) continuous setting tank

about 90 – 91oC 5. Oil tank temperature on Thursday January 3, 2013 the temperature about 79 – 81oC 6. Press station on Thursday January 3, 2013 the temperature is about 90 – 92oC for screw press

number I, II, IV and VI Refer to the company procedure/work instruction for oil tank operation Form No. AG-SMM-WI-P-17 Rev 02 Date Issued March 30, 2009 for CST (continuous setting tank) is about 85 – 95oC. So, for all record number 2 and 4 above was comply with the company procedure/work instruction. And refer to the com-pany procedure/work instruction for screw press operation Form No. AG-SMM-WI-P-07 Rev 02 Date Is-sued March 30, 2009 the temperature for pressing unit is about 80 – 95oC, so for record number 1 and 6 above was comply with the company procedure/work instruction. The company has conducted the socialization for mechanic and operator in the production station for oil tank, and process, with the evidence is attendant list of socialization on Tuesday, July 2, 2013 was con-ducted in workshop and attended 18 participant from operator in process department and mechanic. The company has also done socialization for the oil tank temperature in the process department was held in workshop on Tuesday, July 2nd, 2013 evidence by the list attendance which attended by 18 participant from processing and mechanic. CR4.2 The company has a record of leaf analysis as a reference for fertelizer recommendation, the analyzed conducted on 2011 for fertilizer application in 2012. But there is no record for fertilizer application in 2012. The company company has a record for maintain and increase of soil fertility, but the record just for ferti-lizer application in 2011, because there is no fertilizer application in 2012, the record i.e.: 1. Urea application: dosage 1.50 kg/tree, based on leaf analysis recommendation for urea application is

about 4,624 kg, but based on record, the urea application is only 3,100 kg with the realization per-centaged is about 67% from the recommendation.

2. Rock Phosphate application: dosage 1,50 kg/tree, based on company record there is no application for rock phosphate fertilizer because the management reason and when the field observation, there is no found stock for RP in warehouse.

3. MOP application: dosage 1,50 kg/tree, based on leaf analysis recommendation for MOP application is about 105,393 kg, and based on company record applicated fertilizer was meet with the recom-mendation.

4. Kieserite application: dosage 0,50 kg/tree, based on leaf analysis recommendation for Kieserite ap-plication is about 10,751 kg, and was realized meet the recommendation.

5. Urea application: based on fertilizer recommendation in 2011 for urea application is about 10,123 kg’s but in 2012 there is no found record of realization for this fertilizer.

The company also applied of EFB application to maintain the soil fertility, based on the Work Instruction about the EFB and compost utilization with the document number Form.AG-SMM-WI-E-41 Rev 00 date issued December 8, 2012. The work instruction was state that the EFB application is about 40 – 45 ton/Ha and for compost fertilizer is about 10 ton/Ha. Based on company record for EFB application in 2013, the EFB applied on the field is about 5,582,720 kg from April until July 2013, with the application detailed is: 1. Division 1 is about 816,605 kg’s 2. Division 2 is about 1,094,315 kg’s 3. Division 3 is about 593,010 kg’s



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4. Division 4 is about 1,422,530 kg’s 5. Division 5 is about 452,530 kg’s 6. Division 6 is about 804,100 kg’s Based on field observation on the Division 1, showed the EFB application was meet the company work instruction about the dosage and method for application. For the compost fertilizer application, has ap-plied for compost fertlizer until May 2013, and in June 2013 the company did not applied compost any-more because the management reason. So, until May 2013, the company was done applied the compost is about 63,383,620 kg for all Division. Besides the EFB application, the company also applied POME in the field based on Land Application Decree of Regent of Tanjung Jabung Barat Number 503.8/01/KPPT/2011 about the Land Application li-censed with capacity maximal for application is about 600 m3/day. This permit is valid for 3 years from the issued, during the audit is still valid. The land application area is about 143 Ha, with number of flat bad is 4771 unit, and the dimension is about 5.5 m x 1.5 m x 0.5 m. Based on field observation on Block D1, the application is maintain very well, so there is no overflow potential for POME application process in the field. But based on record of land application on January and June 2012 applicated more than the licensed. CR4.3 Based on soil map, EIA document and soil survey conducted by Primakelola Consulting, there are some area with peat soil in the PT Agrowiyana, with the depth peat variation from: < 50 cm (oxisol gelick), 50 – 100 cm (organosol sapric), 100 – 200 cm (organosol sapric), 200 – 300 cm (organosol sapric) and > 300 cm (organosol sapric). Based on soil survey information the organosol sapric with depth > 300 cm is a peat with category Typic haplohemist or organosol hemic. So, based on information above, type of peat in the company is varied. Based on the peat soil scale 1:50,000 peats with > 300 cm depth located in field number F11, E13, D11, D13, D15, and D17. Based on soil map and EIA document, the company does not have land with highly slope, the topography condition is flat with slope is about 0 – 8%. The company has work program for road maintenance for 2013 and 2012 and was realized with evi-dence: 1. Record of realization road maintenance on April 2013 in Division 1 is about 209,250 m. 2. Record of realization road maintenance on May 2013 in Division 3 and plan for collection road

maintenance is about 16,709 m and production road about 4,201 m, and was realized is about 13,500 m.

3. Record of realization road maintenance in Division 1 on May 2012, with the work program is about 465 m, and was realized along is 18,000 m

4. Record of realization road maintenance in Division 3 on September 2012, along is 18,000 m Besides the work program and realization road maintenance table, the evidence is also has a map of re-alization for work maintenance. The company has a procedure with document number Form.No.AG-SMM-WI-E-36 Date Issued Septem-ber 26, 2011 about the work instruction water level management on the peat soil. On the work instruction water level measurement data collecting is every day with water level acceptable is 50 cm until 75 cm. The company also has procedure number Form.AG-SMM-WI-E-37 Date Issued September 26, 2011 in the procedure was state about measurement procedures for subsidence level on the peat soil use PVC pipe for measuring instruments and collecting data is every six month. Then, based on information form soil survey, type of peat soil depth in the company i.e.: 1. < 50 cm is about 20 Ha (0.41%) 2. 50 – 100 cm is about 301 Ha (6.18%) 3. 200 – 300 cm is about 380 Ha (7.80%) 4. > 300 cm is about 225 Ha (4,63%) For peat management, the company has conducted the measurement of water management program with data daily collecting. Water management for peat soil just conducted in ear 2012 such as: 1. Field Number 35, Division 2 February 2012 until December 2012, based on collection data during the

period there is no indication the water level condition is under standard work instruction company and National Regulation (Decree of Ministry of Agriculuture Number 14/2009), when in the standard the water level shall be maintenance on 50 cm until 75 cm.

2. With the same field above, for the result of water table measurement on the peat soil during the same period, based on recording data, indicated that the water table measurement is in under the work instruction, so this is related to result related to measureent of peat soil subsidence. Based on measurement, the subsidence level on field is under standard.

Peat soil measurement include subsidence, water level, and water table in the company, is no represent



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for all peat depth, especially for peat with > 300 cm depth. CR4.4 The company has carry out the water protection in the riparian/buffer zone with no chemical application (spraying and manuring activity) on the riparian zone. Evidence with marking (white colour) on palm oil tree is about 50 m both sides of the river or as 6 tree of oil palm. Based in field observation, there is no found that the company carry out the chemical application on the riparian zone. Then, company maintenaned the palm oil tree with manual handling, and also plant wood tree (Peronema canescens) in a long of riparian zone. The company was carry out the BOD monitoring from the POME periodically every month and the result was delivered to Environmental Bodies, Jambi Province every six month through the RKL/RPL report, with the evidence is: 1. Result report Number 510/LHU/LABLING/VI/2013, the BOD sampling was taken from pond number

8, and was analysed on June 26 until July 3, 2013, and the result is BOD still under the required standard

2. Result report Number 410/LHU/LABLING/V/2013, the BOD sampling was taken from pond number 8, and was analysed on May 27 until June 13, 2013, and the result is BOD still under the required standard

3. Result report Number 302/LHU/LABLING/III/2013, the BOD sampling was taken from pond number 8, and was analysed on June 26 until July 3, 2013, and the result is BOD still under the required standard

4. Result report Number 217/LHU/LABLING/VI/2012, the BOD sampling was taken from pond number 8, and was analysed on March 25 until April 10, 2013, and the result is BOD still under the required standard

5. Result report Number 057/LHU/LABLING/I/2013, the BOD sampling was taken from pond number 8, and was analysed on January 22 until February 11, 2013, and the result is BOD still under the re-quired standard

The company has water use monitoring per tonne FFB in 2012 and 2013, evidence by: 1. Record monitoring water use in 2012 from January until December with the total FFB process is

263,049 tonne, and total water was used is 223,776 m3, with the average of water use is 0.85 m3/tonne FFB

2. Record monitoring water use in 2013 from January unti June, with the total FFB process is 107,679 tonne, and total water was used is 191,594 m3, with the average of water use is 1.78 m3/tonne FFB.

Based on record of Milling Summary and Process Control on January 2013, water use standard per tonne FFB is 1 m3. Form the record above, water used is still under than milling summary and process control, and for the water used data on 2013 is above the milling summary, because the FFB process is still until June 2013. CR4.5 The company has monitoring of pesticides toxicity per tonne FFB, was evidence by the record of chemi-cal used in production period in 2011 until 2013 i.e.:

1. For 2011: Round up was used is about 0.016 litter/kg FFB, Gramoxone was used is about 0,00156 litter/kg FFB

2. For 2012: Round up was used is about 0.0098 litter/kg FFB, Gramoxone was used is about 0.0016 litter/kg FFB

3. For 2013 until June: Round up was used is about 0.0080 litter/kg FFB, Gramoxone was used is about 0.0038 litter/kg FFB

For Integrated Pest Management, there is no found the record handling of Ganoderma attack in Division II. Because if refer to early warning system record, the attack is high rate. CR4.6 The company was use the chemical registered based on Pesticides Book issued by Pesticides Commis-sion, Directorate General of Estate, Ministry of Agriculture of Indonesia 2012. But the company does no recommendation chemical used from the Ministry of Labour c/q Labour and Transmigration offices asso-ciated with the use of chemical in the workplace (refer to CR 2.1 major). The company does no documentation evidence like a policy for commitment to reduce/eliminate the chemicals categorize from WHO and Rotterdam Convention. But from the realization for chemical appli-cation, the company was applied to reduce the chemical from 1A and 1B WHO and Rotterdam conven-tion based on record of chemical used i.e.:

1. Budget record in 2012 for circle spraying only 0.18 litter/Ha paraquat and in budget record in



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2013 for circle spraying was 0.10 litter/Ha. If refer to record of monitoring chemical use in 2012 to 2013 (June) showed that the chemical used is reduced based on budget.

2. Record of supplier purchase order summary period of January until December 2012 is only 2 times for buy the chemical with type of chemical is Amiphosate.

3. Record of supplier purchase order summary periode of January until July 2013, there is no transaction for chemical ordered included the paraquat.

The company has no medical checkup periodically for all workers who related with agrochemicals for 2012. For preganant and brastfeeding medical checkup, company informed to the clinic for socialization to all workers if they have a pregnant and breastfeeding they must report to the clinic. The company also gave the announcement with memo number 022A/EH-INTI/I/2012 on January 2nd. 2012 which contains information about for sprayer if their have pregnant condition in order no carry out work related to chemi-cals. But based field observation and intervies with employee, they understood very weel if they have pregnant or breasfeeding they do no to work related to chemical, and the company deleverd they to manual working. CR4.7 Company has for occupational safety and health, signed by the Operations Director. The company also has a Sustainable Palm Oil Policy, signed by the President Director dated May 6, 2013, among which im-plement Health and Safety Management System (OHSAS 18001:2007) at each operating company. Pro-cedures and work instructions related to Health and Safety has been created for the Laboratory area (AG-SMK-PL, AG-SMK-WI-L), process / plant (AG-SMK-PP, AG-SMK-WI-P), and workshop POM (SMK-PW-AG, AG-SMK-WI-W). Health and safety related work on plantations, are listed on the Work Instruc-tion Estate (AG-SMK-WI-E). The Company has Procedure for Preparedness and Emergency Response No. form. AG-SM-R-23 rev. 02 dated March 3, 2009. Identified emergencies that may occur in the company is due to fires, accidents, pollution / B3 leaks, natural disasters (floods and earthquakes), and public demonstrations/riots. There is an organization structure Preparedness and Emergency Response PT BSP Tbk Unit Jambi. The compa-ny already put many safety sign including “No Smoking” sign at many places around the office, laborato-rium, workshop, oil tank and mill and effectively implemented by workers. No smoking policy at identified place has stated in Perjanjian Kerja Bersama (PKB) between PT Agrowiyana-AMM (Agro Mitra Madani) and PUK SPP P F SPSI PT Agrowiyana-AMM year period 2013-2015, signed on March, 4, 2013 article 50 (1.4) “Kriteria Pelanggaran, and about punishment stated in Chapter IX Pembinaan Disiplin article 51 Ketentuan-ketentuan umum”. There is a socialization report of use of fire extinguisher (APAR) for Emergency and response team (ERT team), held on May 15, 2013, simulating emergency and response (Anti Fire Coordination Board) and the prevention of work accidents, held at the head office on February 13, 2013, Simulation Bakortiba (Fire Coordination for Emergency Response Agency) on February 10, 2012, emergency and response simula-tion (fire at Palm oil Mill dated March 19, 2013. Against No. NCR. 2011-15 of 34 stated that the correc-tions and corrective actions taken have been effective However, the implementation of OSH in particular for contractor employees who are doing the roof repair work is not in accordance with the applicable rules and regulations. There is no evidence the company has done OSH training to contractor employees, especially addressing the safety and use of PPE. This is raised as non conformity. Agreement on cooperation in the document, the company also does not re-quire the contractor shall comply with applicable regulatory requirements, including OSH regulations. For the regular health examination to all workers exposed to high risk work, the company can not showed record of regular health examination for 2 operator in enginee room in November 2011, and there is no found evidence of realization for the regular health examination in 2012 (this is raised again as a non conformities). For the temporary activities, the company does not have risk assessment, example the activities for roof replace in the mill. There is no found evidence for proof of payment for work insurance (JAMSOSTEK) for all worker in April, May and June 2013 (refer to CR 2.1) CR4.8 It was found that the company has training program for all workers in the estate and mill to indetified what does the training need for every level position and training target,. Example: foremans needs training for information law and regulation, Health and Safety, Risk Assessment, Harvesting Procedure, Spraying Procedure, Fertilizer Procedure, Emergency response, PPE demosntrated; contractor needs training for Health and Safety, Law and regulation, Risk Assessment, Waste management, etc. The company has document of recapitulation training was done for employee in the estate and mill, the



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record informed that name of employee, position, kind of training, years of training and certificate location. Example training for sprayers and for workers related with chemical, was done in July 2012 held by Pesti-cides Committee and pesticides supplier. Etc. For the contractor, the company has requirements for contractor, when the requirement is the contractor must have competention example driver contractor must have licensed for drive, etc. Then, company has record for Contractor Agrement both of PT Agrowiyana and PT Mega Anugrah Sarana (as contractor) number SPK 003/SPK-AGW/III/2012, in clause 4 about “Rights and Obligation” stated that the contractor must provide the heavy equipment operator with a licensed, and profesional mechanical as a requirement for operator. But, the company not yet provide training program for smallholders. Compliance status: No Compliance NCR No. 2013 – 5 until 16 of 29 NCR from CR4.2

1. There is no found the record of leaf analysis periodically for 2012 2. Fertilizer recommendation in 2011 for urea application is about 10,123 kg’s but in 2012 there is

no found record of realization for this fertilizer. 3. There is foun that the realization for land application is more that the licensed on January and

June 2012 NCR from CR4.3

4. There is no found that the water management on peat land no represent for all depth peat on the company

NCR from CR4.5 5. There is no found the record handling of Ganoderma attack in Division II. Because if refer to ear-

ly warning system record, the attack is high rate NCR from CR4.6

6. There is no found a record license for recommendation chemical used from Ministry of Labour c/q Labour and Transmigration Offices associated with the use chemical in the workplace (refer to NCR 2.1)

7. The company has no medical checkup periodically for all workers who related with agrochemi-cals for 2012

8. There is no found the record for company commitment to reduce/elimanate the chemical on 1A and 1B WHO and Rotterdam Convention

NCR from CR4.7 9. Was found that the workers not used the PPE when they work especially for wokers work in alti-

tude more than 2 m 10. There is no record for regular health examination for 2 operator in enginee room in November

2011 (raised again as a non conformities) and the same record in 2012. 11. There is no found of risk assessment for temporary actvitis in the company

NCR from CR4.8 12. There is no found the training program for smallholders

Principle 5: Environmental responsibility and conse rvation of natural resources and biodiversity

Criteria assessed: CR5.1, CR5.2, CR5.3, CR5.4, CR5. 5, CR5.6 Criteria not assessed: CR5.5 Findings:

CR5.1 There is no changes for EIA document (AMDAL) for both company, they still using the same document, the EIA document was issued in Jakarta in 1996 and was signed by the Ministry of Agriculture Number 112/ANDAL/RKL-RPL/BA/X/1996 on October 24, 1996. The company has record of regular reporting of EIA document to Environmental Bodies evidence by: 1. Receipt of delivery RKL-RPL (environmental of management and monitoring) period of January –

June 2012 (Semester 1) was delivered to environmental bodies of Jambi Province with delivery rec-orded on July 27, 2012



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2. Receipt of delivery RKL-RPL document in semester I to Environmental Bodies of Tanjung Jabung Barat Regency on August 16, 2012

3. Receipt of delivery RKL-RPL document period of July – December semester II, to Environmental Bodies of Tanjung Jabung Barat Regency on February 06, 2013

4. Receipt of delivery RKL-RPL document in semester I to Environmental Bodies of Jambi Province on February 7, 2013

In the contains of report was include analysis about, such as: 1. Report of analysis Number 051/LHU/L2JBI/I/2012 about the measurement monitoring of POME ana-

lyzed on January 24 until February 9, 2012, and result is under the standard required. 2. Report of analysis Number 123/LHU/LABLING/II/2012 about the measurement monitoring of POME

analyzed on February 23 until March 12, 2012, and result is under the standard required. 3. Report of analysis clean water from the water treatment plan unit number 2 based on Decree of Min-

istry of Health Number PermenKes 416/MENKES/PER/IX/1990 with the number report analysis 316/LKBTL/V/2012, date of analyzed May 24 – 29 2012, and result is under the standard required.

4. Report of soil analysis Number 135/LKBTL/III/2012 analyzed on February 2 – 6, 2012 with the sam-ple from in flat bad and between flat bad based on Ministry of Environmental Number 28 and 29/2003

5. Report of raw water from Berasau River number 322/LKBTL/V/2012 conducted on May 24 – 29, 2012 with the result is under the standard required, based on Government Regulation Number 82/2001

6. Report of emission analysis number 319/LKBTL/V/2012 conducted on May 22 – 29, 2012 based on Decree of Ministry of Environmental number Kepmen LH Kep-31/MENLH/3/1995 sith the result is under the standard required

7. Report of noise number 092-U/LKBTL/V/2012 and 521-U/LKBTL/X/2012 based on Decree of Minis-try of Environmental number 48/1996 and Decree of Ministry of Labour and Transmigration number Kep-51/1999 about the required standard for noise in workplace. Based on analysis result there is 2 places indicated is upper than standard, and the company was follow up by requiring the workers to use the PPE.

CR5.2 There is no changes on company’s HCV document, company still using the documents that made by ex-ternal consultant last year 2010 as well as documents for HCV management and monitoring plan. Ac-cording to the exisiting HCV document there are 5 types of HCVs were identified in 6 estates is HCV 1.1, 4.1, 1.3, 1.4 and 2.3 (peat area (> 3 m), Riparian zone (Baung river, Brasau river, Giring-giring river, Sianang river), POM’s reservoir (B01), riparian river and watercouses, springs (B02 & D09), and conser-vation forest (B01 & B03). In the report was identified the protected species, rare, threatened or endan-gered, i.e.: 1. Gracula religiosa Cites appendix II 2. Felis bengalensis Cites appendix II 3. Lutra sumatrana Cites appendix II 4. Presbytis melalaphos, IUCN Endangered and Cites appendix II 5. Macaca nemestrina, IUCN Vulnerable and Cites appendix II 6. Macaca fasicularis Cites appendix II 7. Pyhton molurus Cites appendix II 8. Pthyon reticulatus Cites appendix II 9. Varanus salvator Cites appendix II

However detail action plan and appropriate measure to preserve rare, threatened or endangered species and highly conservation value habitats still not implemented. Measures taken for protecting species and their habitats including actions to control any illegal or inappropriate hunting, fishing or collecting activities were only provided through sign boards in all identified HCV areas, housing area and main roads. Posters and signs warning of the presence of protected species still not available, company only put warning board about “Illegal Hunting Restriction” and “Protected Forest”. There is also no guideline available to handling them. There is no communication method to company’s workers regarding how to protect identi-fied HCV areas including rare and endangered species. This is raised again as non conformities. The company was carry out the signboard and was installation in the HCV area and a long on the road, but there is no signboard in the housing, and mill and others area, and the company was conducted the HCV socialization for workers was held on January 17, 2013 in the meeting room, and attended 22 partic-ipants, and socialization for external community was held on 2011 through the public consultation. The company has assign personal that has responsibility to HCV area, however the person is not conduct trained yet and there is no evidence sight that person is conduct monitor plans and manage activities of



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appropriate measure to preserve them. This is raised again as non conformities. CR5.3 For the hazardous waste management, the company has collect the hazardous waste from the all Division in the estate, then all the hazardous deleverd and kept in to the Central Store, after all the hazardous col-lected, the central store delivered to the hazardous warehouse licensed in mill, the delivered times is al-most 2 month, based on recorded delivered i.e.: 1. Record delivered number 00732 Form AGW-FR-03-Rev 00 on May 10, 2013 delivered 4 litter oil to

hazardous warehouse licensed in mill from Division 4 2. Record delivered number 01003 Form AGW-FR-03-Rev 00 on May 31, 2013 delivered 5 litter oil to

hazardous warehouse licensed in mill from Division 4 3. Record delivered number 00797 Form AGW-FR-03-Rev 00 on May 13, 2013 delivered 13 litter oil to

central store from Genset house in Division 2 The hazardouse above stored in central store, and delivered on July 1st, 2013 with form delivered AGW-FR-03-Rev00. From the hazardouse collected process until delivered to warehouse licensed in mill is al-most 2 month (see criteria 2.1.1)

CR5.4 It was verfiied at Agro Mitra Madani Mill has monitor consumption of shell, fiber and fossil fuel and anlysis efficiency of fossil fuel consumption. As seen on Analisy energy used year 2012, it was stated that if company did not use fiber and shell for boiler fuels, to produce 1 ton FFB the mill need 77.25 liter diesel oil. Current condirion company use fiber and shell, diesel oil only used for start up and shut down boiler, disel oil consumption very less i.e. 0.6 liter for 1 ton FFB process.

CR5.6 Company has document about source of GHG emission for PT AMM such as effluent pond, EFB storage, operation machines, boiler operation, FFB and CPO transportation, chemical material storage. Compa-ny’s planning to reduce GHG emission is methane capture as CDM program however, due to financial problem, management decide to postpond the program. Company change their program to reduce pollu-tion and emission through saving energy through saving diesel and electric consumption as seen in PT Agro-mitra Madani palm oil mill and PT Agrowiyana estate. Compare will last year condition company has money saving from diesel consumption this is inline with corporate program efficiency. The company has a list of identification of pollution and emissions sources, but the the list not covered all the actvity in the company. There is no found evidence of realization for monitoring of pollution and emission also mitigation for GHG. Compliance status: Non Compliance NCR No. 2013 – 17 until 22 of 29 NCR from CR5.2 1. Theres no found record of impelementation of management plan HCV especially for monitoring,

measurement, preserve and protection 2. Theres no found signboard was installation in the housing, mill and others area 3. Company has assign the HCV PIC for manage the HCV area, but the person have no yet training for

HCV NCR from CR5.6 4. List of identification pollution and emission of the company still not covered all actvities 5. There is no found evidece of realization to monitoring and mitigation for GHG

Principle 6: Responsible consideration of employees and of individuals and communities af-fected by growers and mills

Criteria assessed: CR6.1, CR6.2, CR6.3, CR6.4, CR6. 5, CR6.6, CR6.7, CR6.8, CR6.9, CR6.10, CR6.11 Criteria not assessed: CR 6.10



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Findings: CR6.1 The company has management and monitoring program for social impact assessment every 6 month. The team assigned to do this is Public Relation Department and Quality Control Department, example is: 1. Record of reported management and monitoring social impact assessment for semester 1 in January

until June 2012 2. Record of reported management and monitoring social impact assessment for semester 2 in July un-

til December 2012 3. Record of reported management and monitoring social impact assessment for semester 1 in January

until June 2013 Then, company also has realization for social impact assessment, i.e: 1. Infrastrcuture for social fasilities 2. Smallholders empowerment 3. Employment opportinities 4. Employment bussiness 5. Land conflict Beside that, the company has reported the RKL-RPL (management and monitoring plan) every 6 month; when that report was include the social impact. Exampel social impact report from the RKL-RPL is infor-mation about local labour who has worked in the company is about 850 person and non-local labour just only 503 person. But, the report of social impact assessment is not included the negative impact from the estate and mill activity, and there is no documentation for management and monitroing social impact in-volving the communities periodically. There is no revision for social impact assessment, the company still using similar social impact assess-ment report. CR6.2 The company has procedure for communication and consultation with the community, SOP AG-SM-R-24 about the communication, consultation and participation. The machanism of the SOP’s is: 1. Identification and reported to the manager result of communication, participation and consultation

conducted with the community 2. Make a program of internal consultation for employee and workers 3. Coordination for conduct of communication with the external community 4. Acceptance of grievence or non compliance from the community or legal agency and coordinated

with related departement in the company for the solution. Then, based on SOP’s above the company has a record documentation of consultation and communica-tion with community and related stakeholders through the log book and maintaned very well. But this SOP was compiled without involve of communities and related stakeholders. Company also has list of related stakeholders with company, the list stakeholders was include govern-ment, local government from all village, army, local cooperation, and local clinic in the village. However contractors and supplier are not listed in the list of stakeholder. For the record of communities aspiration and responses followed by the company and was recorded by the documentation through the log book and every aspiration from the communities followed, example on Febryary 4, 2013 from Purwodadi communities applied for productive economic development No. 140/0154/Pem/2013 addresed to PT Agrowiyana, and responsed by company throuh letter with the an-swer the company can not fulfill the request. Company assign 2 person who has responsible for consulting and communicating according to the letter decree number 033/BUH/BSP-JBI.I/II/2012 and number 279/HRD/BSP-JBI.I/AGW/V/2012. CR6.3 The company has procedures SOP AG-SMM-P-S-02-Rev00 for identification and calculation of fair com-pensation, this SOP’s still same with the main audit, the company no changes the SOP, but there is no evidence that the SOP was accepted by the affected parties. The company has records for handling fo the complaints through the log book. The complaints was rec-orded in to log book example workers complaint on January 7, 2013 from Division 7, housing number 6A and 6B about the door broken. Until during the audit, still in the process. CR6.4 The company has etablished a mechanism for identification, calculation and compensation of loss of le-gal or costumary rights of land with involvement of local community representatives and relevant agen-



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cies SOP AG-SMM-P-S-01 2011 similar with previous audit procedure. For the process of negotiation compensation was written in to the compensation agrements and was sign by the all related stakehold-ers. Example is documentation for compensation for 12 person for land acquision 68.25 Ha on July 28, 1993 and agreed compensation amount of IDR 9,540,625 with the letter agreement and photograph. CR6.5 For the salary of all workers and employee the company refer to Governor Decree Number 626/Kep.Gub/DISOSNAKERTRANS/2012 about the minimum salary for Jambi Province in 2013, the min-imum salary is IDR 1,300,000. The salary structure consists of salary, overtime, bonus, allowance. The company has alist of salary consists of name of workers and employee, workers and employee ID, level and position, basic salary, place of origin, date of birth, age and date of work and religion. The company also has collective labour agreement both of PT Agrowiyana and PUK.SPP.F.SPSI Agrowiyana-AMM pe-riod of 2013 – 2015. Example for determination of minimum salary, wage profision for daily labour was meeting with the law and regulation. It was found the agreement both of company and contractor not consistent about abide the law and regu-lation especially for labour regulation, example in letter of agreement SPK No. 033/SPK-AGW/III/2012 on the letter state that contractor should be abide to the regulation of Safety and Health regulation about the PPE for workers. But in ithe letter agreement SPK No. 059/SPK-AMM/VI/2013 there is no found same cluasul. CR6.6 The company still consisten with ther policy for freedom of association for workers. Company also, has same worker union in both of company and was approved by the Head Labour and Transmigration. The wokers union has documentation of periodically meeting example on July 10, 2013 discussion about the payment of wages for monthly workers, and based on meeting result will be paid on July 11, 2013. CR6.7 During the audit, company has no changes their is policy about the workers age requirement, and still same with the main audit, when standart for worker is should be above 18 years old and was meet with the law and regulation. Based on record of documentation list of workers which informs identity of work-ers, age’s, date of birth, date of work, and there is no identified the worker is under than 18. But the com-pany not ensured that they contractor is abide for this regulation, because found that the workers of con-tractor CV AMS is work under age. CR6.8 The company has no changes to their policy about the equal opportunities for all employees, the compa-ny still consistent to follow that policy, evidence by opportunities for all workers carrier without distinguish the sex, religion, level, education background, etnic and etc. CR6.9 The company has no changes their policy about the sexual harassment and violence, and still consisten to implement the policy for all activity in the estate and mill. This policy was documented in the signboard and available in housing and office. Based on field observation in sprayer workers they understood that the policy and they know where to report it. The company also has policy about the protection of repro-ductive rights, and this policy still same and there is no changed. The company was implemented their policy by the documentation about the provided of maternity leave for some workers on February 2013, and the workers still get the salary when she’s leave. CR6.11 There is no found record of realization for CSR program related to company contribution for local devel-opment. This is raised as non conformity. Compliance status: Non compliance NCR No. 2013 – 23 until 28 of 29 NCR from CR6.1 1. There is no found report of management and monitoring of social impact assessment was included

the negative impact from the company actvities 2. There is no found record of management and monitoring of social impact was accepted by all



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stakeholders NCR from CR6.3 3. There is no found record documentation of SOP consultation and communication was accepted by

the affected communities 4. There is no found that the mechanism of grievence was accepted by the affected communities NCR from CR6.5 5. There was found on the SPK (letter agreement for contractor) not consistent about the abide la-

bour law and regulation NCR from CR6.11 6. There is no found record of realization for CSR program related to company constribution

Principle 7: Responsible development of new plantin gs

Criteria assessed: CR7.1, CR7.2, CR7.3, CR7.4, CR7. 5, CR7.6, CR7.7 Criteria not assessed: Findings: No finding related to new development area because company has no development area program. The company’s first planting took place in year 1993 for an area of 659.00ha and completed plantings in year 2005 for an area of 274.83ha. As there are no new plantings, this requirement is not applicable. According to the estate’s AMDAL document prepared in 1996, the area within the company’s ‘Ijin Perlepasan’ (Release permit) covering an area of 13,000ha had no primary forest but only secondary forest classified under ‘Hak Pengusahaan Hutan’ (Forest Development Rights) and vegetation in the forms of wild bushes and other types of commercial and non-commercial vegetation. Compliance status: Not Applicable

Principle 8: Commitment to continuous improvement i n key areas of activity

Criteria assessed: CR8.1 Criteria not assessed: - Findings: Overall implementation of plans is defined based on risk level evaluated for identifying significant as-pects. Verified & cross checked implementation of the actions such as waste management control, chemical management control, etc. During surveillance audit the proposed corrective actions from last RSPO audit are not well implemented, it was sight similar non confirmities.

There is no improvement plans were established for year 2012 and 2013 since company has financial problem. Even in the field auditor team found a lot of potential improvement in key areas and activities. All similar non conformties has been raised again. Compliance status: Non Conformities see revelan NCR on Principle 1 to 6

RSPO Certification Requirement No 4.2.3

Findings: NCR No. 2013 – 29 of 29 There is no found the program and realization for smallholder certification process preparation. Compliance status: Non compliance



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3.2 Status of Previously Identified Non-conformitie s

A total of 34 nonconformances were identified during the main certification assessment. These consisted of 12 major non-conformities and 22 minor non-conformities. During this surveillance assessment, it was found that there was lack of evidence to close 11 of the 34 nonconformities, and these have been raised to Major Non-conformities under Section 3.3. The following is a description of the evidence of action taken to close the non-conformities raised during the previous assessment, as well as auditor’s conclusions on the status of the non-conformities.

Criterion 1.1.2 (Major): Records of responses to in formation requests.

NCR No. 2011-01 of 35 There is no evidence of responses to incoming requests of information from stakeholders e.g. Head of Badang Village Nomor 02/KRT/2011 dated June 11, 2011 regarding donation request for football yard in Badang Village.

Correction : For every incoming letter, company makes records of responses for each incoming letter from stakehold-ers.

Corrective Action : Management Representative and General Affair section will maintain records of all response to infor-mation requests in journal book and these shall be reviewed periodically.

Auditor Conclusions: Closed Audit Verification Findings : The company has log book for documented all of incoming letter and the company has efforts to main-tanance and update their log book. Incoming letter from Head of Badang Village Nomor 02/KRT/2011 dated June 11, 2011 regarding donation request for football yard in Badang Village was responded on July 20, 2012 through estate manager letter no. 12/AGW/XII/2012.

Criterion 1.1.3 (Major): The records mentioned in 1 and 2 must be maintained for a period of time determined by the company, taking into account thei r relative importance.

NCR No. 2011-02 of 34 Company has no good filing system and has no rule of retention time of records keeping especially rec-ords for company responses for all incoming letter. Correction : Records control procedure. AG-SM-R-24 rev.01 (date issued September 27, 2011) was revised include statement that records will be kept for 3 years.

Corrective Action : To ensure that respond for all information requests are recorded in the journal book, and reviewed period-ically.

Auditor Conclusions : Closed Audit Verification Findings : There is SOP AG-SM-R-24 rev.01 (date issued September 27, 2011) regarding records keeping, the rec-ord has been include information about the retention time for 3 yers. It was sight that the company com-mitment for compliance their procedure about the retention time document as seen on the log book for records keeping.



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Criterion 1.2.1 (Major) Information and responses m ust include any relevant or required documen-tation, in accordance with applicable national laws , such as: • Legal: Land titles/user rights (Site Permit (Izin Lokasi), Plantation Operation Permit (Izin Usaha Perkebunan), Land Use Title (Hak Guna Usaha) or oth er documentation relating to application for Land Use Title in accordance with relevant procedur es) • Environmental: Environmental and Social Impact As sessment (AMDAL /UKL-UPL) and environ-mental management and monitoring reports (Laporan R KL-RPL) • Social: Documentation of social activities and co mmunity programs. • Health and Safety Plan • Continuous improvement plan

NCR 2011- 03 of 34 The company has no mechanism to maintain all incoming requests for information and responses made, and has not defined the retention time of records kept.

Correction : Management has determined which documents are to be made publicly available in issued letter number 55/CA-legal/JMB/IX/2011 signed by General Manager and state that retention time for records is 3 years.

Corrective Action : To submit the letter to stakeholders such as head of village and other relevant stakeholder upon request To ensure that a community knows which document can be access and record all incoming request letter properly according to documents and data control procedure.

Auditor Conclusions : Closed Audit Verification Findings : The company has procedure for the retention time for document AG-SM-R-24 Rev 01, in the procedure has put the information about the retention time for document is 3 years.

Criterion 2.1.1(Major): Evidence of compliance with relevant legal requirements.

NCR No.2011- 04 of 34 Some evidence was found that the company still not comply to government regulations such as:

- Storage of hazardous wastes has exceeded the maximum permitted time for storage of hazardous wastes (more than 90 days).,Some empty oil drums were also sighted near the workshop that were left in the open and not stored as hazardous waste. This is not in compliance with government regula-tion No. 18 year 1999 regarding hazardous waste management.

- There are two employees who have worked more than 21 days per month for 3 months continuously but not yet appointed as permanent workers, and this is not in compliance with regulation Kep-menaker no. 100 year 2004 100/2004 regarding temporary and permanent worker.

- There is no evidence found that “Jamsostek” payment for period August 2011 has been done this is not in compliance with government regulation No. 28 year 2002.

Correction :

- Hazardous waste has been collected by licensed supplier. All empty drums were move to proper stor-age place separated with other hazardous waste storage area in front of the warehouse and covered properly to prevent unintended usage.

- Workers status were changed into permanent staff

- The company has submitted a payment letter to the related institution regarding Jamsostek (Worker Social Insurance) as payment for period August 2011

Corrective Action : The company conducts periodic review for all applicable legal and other requirements to ensure it compli-ances following procedure of legal compliance evaluation. Legal evaluation will be conducted be Man-



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agement Representative every six months and the result will be discussed during management review meeting for the next action.

Auditor Conclusions : Open, raised again as non con formities Audit Verification Findings : - The company has been sent the hazardous waste to CV Surya Jaya Logam (licensed Collector) based

on decree Ministry Environmental of Indonesia No.53/2011 about licensed for collecting of hazardous waste to CV Surya Jaya Logam with type of hazardous waste is oil and grease for Sumatra Region, this licensed valid for 5 years from issued on March 28, 2011 until March 27, 2016, and based on the Gov-ernor Province of Jambi Decree Number 07/BPMD-PPT-4/2013 about license for hazardous collecting on province scale for accu issued on February 25, 2013 valid for 5 years. CV Surya Jaya Logam also has licensed for hazardous transportation based on letter of recommendation for hazardous waste transportation was issued by Ministry of Environmental of Indonesia Number B-10881/Dep.IV/LH/11/2011 on November 22, 2012 and this licensed valid only for 1 years at the audit conducted the licensed is not valid anymore. Accoring to the license, the unit (vehicle) that allowed for hazardouse waste transportation is unit with number BH 8535 MK and BH 8419 AO. The company also has a licensed for hazardous storage based on Decree Letter from head of Environmental Bodies Number 660/688/BLH on October 02, 2012 about hazardous storage with type of hazardous waste are oil, accu, contaminated glove, contaminated cloth, filter oil, mercury lamp with retention storage is 90 days, valid in 3 years, and when the audit conducted the licensed is still valid. Then the company re-quest submit for hazardous waste retention storage, based on Decree of Environmental Bodies Tanjung Jabung Barat Regency Number 660/551/BLH on June 24, 2013 about the letter of hazardous waste temporary retention storage PT Mitra Agro Madani to be 180 days, and this letter valid from June 2013. Based on hazardous waste transportation record to licensed collector, the company is still not complied, evidenced is transportation of hazardous waste to licensed collector is more than 90 days storage, i.e.: � Minutes of meeting hazardous waste on Thursday, April 18, 2013 with kind of hazardous waste is oil

1,324 litter (7 drum) and accu 23 pcs, with hazardous waste manifest number 0000179 on April 18, 2013 with unit (vehicle) number in BH 8535 MK.

� Minutes of meeting hazardous waste on Monday, December 17, 2012 with kind of hazardous waste is oil 1,188 litter (6 drum) with hazardous waste manifest number 0000143 on December 17, 2012 with unit (vehicle) number in BH 8419 AO.

Based on record above, hazardous waste delivery number 2 (on December 17, 2012) to number 1 (April 18, 2013) is more than 90 days, and based on hazardous waste manifest on December 17, 2012 and April 18, 2013 with the number of unit transport is BH 8535 MK and BH 8419 AO was not valid.

- The company has changes the status of the employee into the permanent employee - The company showed the JAMSOSTEK payment for period August 2011.

Criterion 2.1.1 (Major) Evidence of compliance with relevant legal requirements.

NCR No. 2011-5 of 34 Some of applicable legal and other requirements are still not listed on the company’s “List of Applicable lagal and other requirement. AG-SMM-P-S-03, issued date: 15 such as Manpower and transmigration ministry decree letter no. 100/2004 regarding temporary and permanenet worker regulation still not in-cluded on the list, Per.01/MEN/1976, Per.01/MEN/1988, Kep. 155/MEN/1984, UU No.13/2003 and UU No.3/1992.

Correction : Company revised List of Applicable legal and other requirement. AG-SMM-P-S-03, include all applicable regulation and other requirement such as Kepmenaker no. 100/2004 regarding temporary and permanent worker regulation, Per.01/MEN/1976, Per.01/MEN/1988, Kep. 155/MEN/1984, UU No.13/2003 and UU No.3/1992. Corrective Action : Management Representative will review periodically and updates all applicable legal and other require-ments on the list and ensures its compliances, as required by procedure. Auditor Conclusions : Open, raise again as non conformiti es



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Audit Verification Findings : The latest updated of list of regulation (Daftar Peraturan/Perundang-undangan) (AG-SMM-P-S-03 rev. 01 attachment 9.1) have been carried out on July, 15, 2013. In that list, manpower and transmigration minis-try decree letter no. 100/2004 regarding temporary and permanent worker regulation and UU no. 3/1992, Per.01/MEN/1976, Per.01/MEN/1988, Kep. 155/MEN/1984, and UU No.13/2003 already included on the list. The company already put the new regulation on OHS such as PP no. 50/2012 on the list. The company revised procedure AG-SMM-P-S-03 and state that review periodically and updates all appli-cable legal and other legal requirements shall be conducted yearly. In 2013 company has revised the list two times, on January 10, 2013 and July 15, 2013. However, the company has not been able to meet some of the rules that must be implemented. There is no evidence that the company has paid Social Security contributions (Iuran Jamsostek) for the month of April, May, and June of 2013, this is not meet with Peraturan Pemerintah (PP) No. 28 of 20012 on the Im-plementation of the Social Security Program (Jamsostek).

SIO (Operating Permit Letter) of two wheel loader operators at the loading ramp (labor contractors), has expired 6 months ago (December 31, 2012) and can not show proof of renewal.

Some contractor employees who perform roof replacement plants are not equipped with adequate protec-tive equipment, such as not using welding goggles while doing welding activity, do not use the helmet and the workers who work at height is not equipped with a safety belt. This was not meet to the provisions of the Law no. 1 of 1970 on Occupational Safety and Permenaker no. 8 of 2010 concerning Personal Pro-tective Equipment. Cooperation agreement between the company and the contractor has not including a clause that the contractor must meet all applicable regulatory requirements. No available evidence that the company has conducted briefings for contractor employees who will do the work in a corporate envi-ronment. Clinic of Agrowiyana have gained Licensed Clinical decision by Kepala Dinas Kesehatan Kab Tanjung Jabung Barat no. 441.2/006/KES/2012 tanggal 24 Februari 2012 valid until February 27, 2017. Wastewater Utilization Permit (Land Application) of plantation PT Agro Mitra Madani based on Keputusan Bupati Tanjung Jabung Barat no. 503.8/01/KPPT/2011 dated July 25, 2011, the terms of BOD 5,000 mg / l, pH of 6-9, valid license 3 years, wastewater is applied 600 m3/day, for the vast 143 ha, rorak 4771. Based Effluent Monitoring Report conducted every 3 months seen that the discharge of waste water that flowed into the garden in January 2012 more than 600 m3/day

Criterion 2.1.2 (Minor) A mechanism for ensuring th at compliance with relevant legal requirements is implemented.

NCR 2011-06 of 34 There is a procedure of evaluation of compliance to government regulation i.e. AG-SMM-P-S-01, rev. 03, date issued: 7 February 2011 section 6.4.5 stated that evaluation shall be conducted 6 monthly by each section and recorded on No. AG-SM-R-26, however there is no evidence that evaluation has been done consistently as seen that last evaluation in November 15, 2010.

Correction : Section head conduct evaluation of applicable legal requirement as required by procedure and record the result on AG-SM-R-26. The report will be submitted to management representative.

Corrective Action : Management representative will sent a letter for each section head every six months to ensure that evalu-ation of compliance to government regulation always conducted as determined by relevant procedure.

Auditor Conclusions: Open again as non confomities Audit Verification Findings: On the latest revised procedure of List of Applicable Legal and Other Requirement Form No.AG-SMM-P-S-03, rev. 01 dated September, 27, 2011, section 6.4.5 stated that evaluation shall be conducted 1 yearly, using Form no. AG-SMM-P-S-03 attachment 9.2. There is a document Status Pemenuhan Peraturan Le-gal dan Persyaratan lainnya yang terkait dengan Lingkungan, K3, RSPO dan ISPO, date issued on July, 15, 2013. But there is no evidence Management Representative sent a letter for each section head yearly to ensure that evaluation of compliance will be conducted as determined by procedure AG-SMM-P-S-03, rev. 01 as stated in corrective action. Evaluation of compliance conducted by assistant CA at least one



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time in 1 year. During 2013 there are 2 revised of list of document legal and its compliance, date issued on January 10 and July 15. These changes led to the evaluation of compliance with applicable laws and regulations are not accurate. In the field found the company has not fully complied with the rules and reg-ulations that must be followed.

Criterion 2.2.2 (Minor). A mechanism to resolve con flict which is accepted by all parties.

NCR No 2011-07 of 34 There is mechanism to resolve conflict but no evidence that the mechanism has been accepted by all par-ties. Correction : Company made conflict resolution mechanism and communicated with relevant stakeholder for ac-ceptance

Corrective Action : Identify whether still any other mechanism which is need communicated to stakeholder

Auditor Conclusions: Closed

Audit Verification Findings : The company has mechanism for conflict resolve and was accepted by all communities and related stakeholders

Criterion 3.1 (Major) : A documented working plan of the company for a mi nimum of 3 years period.

NCR No 2011-08 of 34 Budget for non operational activities is available but the budget is not detailed because for several ac-tivities such as RKL/RPL activities, OSH expert training, renewal of operator crane’s license, replace-ment of displacement pump no.8 (this was found to be damaged but not budgeted for repair), RSPO, Social Impact Assessment, identification of HCV areas, training for HCV officers and resolution conflict, it is not clear whether its activities are included in this budget. Correction : Revised company’s management plan for year 2012 include budget for all activities such as budget for environmental management and monitoring, Safety and Heath activities, Social issues activities, and operational activities. Corrective Action : The company made a procedure as guidance to each section for making budget plan every year as consideration to make 3 years management plan. Auditor Conclusions : Closed Audit Verification Findings : It was verified budget document for operational activities such as mill and estate operational and non operational activities asuch as General & Affair expenses activities, including budget for environmental monitoring, safety compliances, maintenatnce program, social issues for year 2013, for next 3 year all activities has been included and increase 10% every year.

Criterion 4.1.2 (Minor): Records of operational res ults.



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NCR No. 2011-09 of 34 There are operational activities not appropriate with procedure such as: 1) Temperature of disgester in SOP pressing process is 95 ± 50C but actual in screw press no.4 & 5 is 600C and no. 1 & 2 is 550C (record of press daily report (AG-SMM-FR-P-04) on August 1, 2011; 2) Temperature of oil tank in SOP is 70 ± 100C but actual in record of AG-SMM-FR-P-04 on May 2, 2011 is 75-820C and on August 1, 2011 is 75-890C. Correction : Replace digester temperature control on screw press machine and oil tank and make adjustment the pa-rameter control according to existing standard operation procedure in the mill.

Corrective Action : Made monitoring program periodically for all measuring equipment, ensure that all equipment in good condition and good function. Company will provide awareness training for all relevant operators to im-prove their knowledge about how to operate the equipment in the right way according to existing standard operational procedures.

Auditor Conclusions: Closed Audit Verification Findings: The operational record result as well maintained at all estate and mill, such as FFB delivery records, FFB grading reports and process daily reports. When the evidence example is from daily record: 1. Press station on Monday June 17, 2013 was recorded the temperature of digester about 85 – 95oC 2. Clarification station on Monday June 17, 2013 was recorded the temperature CST (continuous setting

tank) about 90 – 95oC 3. Oil tank temperature on Monday June 17, 2013 about 85 – 90oC 4. Clarification station on Thursday January 3, 2013 the temperature of (CST) continuous setting tank

about 90 – 91oC 5. Oil tank temperature on Thursday January 3, 2013 the temperature about 79 – 81oC 6. Press station on Thursday January 3, 2013 the temperature is about 90 – 92oC for screw press num-

ber I, II, IV and VI Refer to the company procedure/work instruction for oil tank operation Form No. AG-SMM-WI-P-17 Rev 02 Date Issued March 30, 2009 for CST (continuous setting tank) is about 85 – 95oC. So, for all record number 2 and 4 above was comply to the company procedure/work instruction. And refer to the company procedure/work instruction for screw press operation Form No. AG-SMM-WI-P-07 Rev 02 Date Issued March 30, 2009 the temperature for pressing unit is about 80 – 95oC, so for record number 1 and 6 above was comply to the company procedure/work instruction. The company has conducted the socialization for mechanic and operator in the production station for oil tank, and process, with the evidence is attendant list of socialization on Tuesday, July 2, 2013 was con-ducted in workshop and attended 18 participant from operator in process department and mechanic. The company has also done socialization for the oil tank temperature in the process department was held in workshop on Tuesday, July 2nd, 2013 evidence by the list attendance which attended by 18 participant from processing and mechanic.

Criterion 4.4.1 (Minor). An implemented water manag ement plan.

NCR No. 2011-10 of 34 The company has total peat area of 225 ha, however company has no water management program to control and prevent peat soil damage. Correction : Company made standard operation procedure including relevant working instruction for subsidence moni-toring level for peat land area.



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Corrective Action : Implement consistently standard operation procedure for subsidence level monitoring. Reporting the re-sult periodically to management representative for further action. Auditor Conclusions: Open raise again as a non conf ormities Audit Verification Findings : The company has a procedure with document number Form.No.AG-SMM-WI-E-36 Date Issued Septem-ber 26, 2011 about the work instruction water level management on the peat soil. On the work instruction water level measurement data collecting is every day with water level acceptable is 50 cm until 75 cm. The company also has procedure number Form.AG-SMM-WI-E-37 Date Issued September 26, 2011 in the procedure was state about measurement procedures for subsidence level on the peat soil use PVC pipe for measuring instruments and collecting data is every six month. Based on soil survey conducted by Primakelola Consulting, type of peat soil depth in the company i.e.: - < 50 cm is about 20 Ha (0.41%) - 50 – 100 cm is about 301 Ha (6.18%) - 200 – 300 cm is about 380 Ha (7.80%) - > 300 cm is about 225 Ha (4,63%) The company has conducted the measurement of water management program with data collecting is eve-ry day. Water management on peat soil conducted in 1. Field Number 35, Division 2 February 2012 until December 2012, based on collection data during the

period there is no indication the water level condition is under standard work Instruction Company, when in the standard the water level shall be maintenance on 50 cm until 75 cm.

2. But, with on the same field above, for the result of water table measurement on the peat soil during the same period, based on recording data, indicated that the water table measurement is in under the work instruction, so these result related to measurement of peat soil subsidence. Based on measure-ment, the subsidence level on this field is under standard.

Peat soil measurement include subsidence, water level, and water table in the company, is no represent for all peat depth, especially for peat with > 300 cm depth.

Criterion 4.4.3 (Minor)Monitoring of mill water use per tonne of FFB.

NCR No. 2011- 11 of 34 Plantation and mill use water for production process but mill does not carry out monitoring of mill water use per tonne of FFB. Correction : Company made monitoring of mill water used for FFB processed every month, record of water consump-tion per ton FFB are kept maintained by engineering section in the mill Corrective Action : Develop a working instruction for water consumption monitoring, communicate the working instruction to all relevant employees and implement it consistently.

Auditor Conclusions: Closed Audit Verification Findings: The company has make water use monitoring per tonne FFB in 2012 and 2013, evidence by: 1. Record monitoring water use in 2012 from January unti December with the total FFB process is

263,049 tonne, and total water was used is 223,776 m3, with the average of water use is 0.85 m3/tonne FFB

2. Record monitoring water use in 2013 from January until June, with the total FFB process is 107,679 tonne, and total water was used is 191,594 m3, with the average of water use is 1.78 m3/tonne FFB.

Based on record of Milling Summary and Process Control on January 2013, water use standard per tonne FFB is 1 m3. Form the record above, water used is still under than milling summary and process control, and for the water used data on 2013 is above the milling summary, because the FFB process is still until



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June 2013.

Criterion 4.5.2((Minor): Monitoring of pesticide to xicity units (a.i. /LD 50 per tonne of FFB or per hectare).

NCR No. 2011- 12 of 34 The estate maintains records of dosages of chemicals applied per hectare but no monitoring of pesticide toxicity units as required. Correction : Monitoring of pesticide toxicity units (a.i. /LD 50 per tonne of FFB or per hectare) has been made. And will be monitor periodically at least one a month. Corrective Action : Develop a working instruction for monitoring of pesticide toxicity units, communicate the working instruc-tion to all relevant employees and implement it consistently. . Auditor Conclusions: Closed Audit Verification Findings : The company has make the monitoring of pesticides toxicity per tonne FFB, was evidence by the record of chemical used in production period in 2011 until 2013 i.e.: 1. For 2011: Round up was used is about 0.016 litter/kg FFB, Gramoxone was used is about 0,00156 lit-

ter/kg FFB 2. For 2012: Round up was used is about 0.0098 litter/kg FFB, Gramoxone was used is about 0.0016 lit-

ter/kg FFB 3. For 2013 until June: Round up was used is about 0.0080 litter/kg FFB, Gramoxone was used is about

0.0038 litter/kg FFB Criterion 4.6.1 (Minor): Documentary evidence that use of chemicals categorised as World Health Organisation Type 1A or 1B, or listed by the Stockh olm or Rotterdam Conventions, and paraquat, is reduced and/or eliminated. NCR No. 2011-13 of 34 Companies have not plan to reduce and/or eliminate use of gramoxone. Correction : Made program to reduce gradually the use of gramoxone which is containt paraquat. Ask purchasing de-partment to find another agrochemical to replace Gramoxone which is has same function.

Corrective Action : Purchasing department and RSPO management representative will identify any other agrochemical mate-rial which is listed on type 1A and 1B, WHO list or Stockholm or Rotterdam Convention and will try to find agrochemical material which is not listed as forbidden agrochemical.

Auditor Conclusions: Open raise again as non confor mities Audit Verification Findings: The company does no documentation evidence like a policy for commitment to reduce/eliminate the chemicals categorize from WHO and Rotterdam Convention. But from the record realization for chemical application, the company was apply to reduce the chemical from 1A and 1B WHO and Rotterdam con-vention based on record of chemical used i.e.:

1. Budget record in 2012 for circle spraying only budgeted 0.18 litter/Ha paraquat, and in record budget in 2013 for circle spraying was budgeted 0.10 litter/Ha. If refer to record of monitoring chemical use in 2012 to 2013 (June) showed that the chemical used is reduced based on budg-et.



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2. Record of supplier purchase order summary period of January until December 2012 is only 2 times for buy the chemical with type of chemical is Amiphosate.

3. Record of supplier purchase order summary periode of January until July 2013, there is no trans-action for chemical order include the paraquat.

Criterion 4.6.2 (Minor) Records of the results of h ealth check-up for those who apply agrochemi-cals.

NCR No. 2011-14 of 34 There are employees were found to have signs of breathing difficulties, lung tuberculosis and have cho-linesterase level exceeding normal levels are still working as sprayers with no action taken by manage-ment. Correction : Rechecking relevant worker who suffer breathing difficulties, lung tuberculosis and have cholinesterase level exceed, and send them for further medical check program to ensure that they need further treatment

Corrective Action : Identify section that apply agrochemical, identify all existing workers in that section and made routine medical check up for those who work directly apply agrochemical.

Auditor Conclusions: Opean raised as a non conformi ties Audit Verification Findings : Rechecking relevant workers who suffer breathing difficulties, lung tuberculosis and have cholinesterase level exceed has not been done, either in 2011 or 2012. The company has identified workers who perform agrochemical application, but medical checkup conducted in December 2012 was limited to a physical examination by dr. Agus Suprapto, and have not done the necessary health checks for workers at risk (x-ray, audiometry, cholinesterase etc.). Company has programmed a general check up to the employees in June 2013 in collaboration with RS Bratanata Jambi, but not yet implemented.

Criterion 4.7.1(Major) Evidence of a documented occ upational safety and health (OSH) policy and its implementation.

NCR No. 2011-15 of 34 The company has an occupational safety and health (OSH) policy however it was not well implemented, with evidence that many cigarette butts were sighted in front of danger area which has sign “no smoking” area i.e. fuel oil storage which is categorized as danger and flammable location. Correction: The company placed larger “No Smoking” sign boards in all locations with high explosion risk and put cir-cular warning letter inform about punishment for those who violate this letter.

Corrective Action : The company will provide training to improve workers awareness about safety and health including haz-ard from smoking activities.

Auditor Conclusions: Closed Audit Verification Findings: Company has company policies, which include occupational safety and health, signed by the Operations Director. The company also has a Sustainable Palm Oil Policy, signed by the President Director dated May 6, 2013, among which implement Health and Safety Management System (OHSAS 18001:2007) at each operating company. Procedures and work instructions related to Health and Safety has been creat-



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ed for the Laboratory area (AG-SMK-PL, AG-SMK-WI-L), process / plant (AG-SMK-PP, AG-SMK-WI-P), and workshop POM (SMK-PW-AG, AG-SMK-WI-W). Health and safety related work on plantations, are listed on the Work Instruction Estate (AG-SMK-WI-E).

The Company has Procedure for Preparedness and Emergency Response No. form. AG-SM-R-23 rev. 02 dated March 3, 2009. Identified emergencies that may occur in the company is due to fires, accidents, pollution / B3 leaks, natural disasters (floods and earthquakes), and public demonstrations/riots. There is an organization structure Preparedness and Emergency Response PT BSP Tbk Unit Jambi. The compa-ny already put many safety sign including “No Smoking” sign at many places around the office, laborato-rium, workshop, oil tank and mill and effectively implemented by workers. No smoking policy at identified place has stated in Perjanjian Kerja Bersama (PKB) between PT Agrowiyana-AMM (Agro Mitra Madani) and PUK SPP P F SPSI PT Agrowiyana-AMM year period 2013-2015, signed on March, 4, 2013 article 50 (1.4) Kriteria Pelanggaran, and about punishment stated in Chapter IX Pembinaan Disiplin article 51 Ketentuan-ketentuan umum. There is a socialization report of use of fire extinguisher (APAR) for emergency and response team, held on May 15, 2013, simulating emergency and response (Fire ) and the prevention of work accidents, held at the head office on February 13, 2013, Simulation emergency and response February 10, 2012, emer-gency and response simulation (fire at Palm Oil Mill dated March 19, 2013. Against No. NCR. 2011-15 of 34 stated that the corrections and corrective actions taken have been effective. However, the implemen-tation of OSH in particular for contractor employees who are doing the roof repair work is not in accord-ance with the applicable rules and regulations. There is no evidence the company has done OSH training to contractor employees, especially addressing the safety and use of PPE, this is raised as NCR 2013 - (see criteria 2.1.1). Agreement on cooperation in the document, the company also does not require the contractor shall comply with applicable regulatory requirements, including OSH regulations.

Criterion 4.7.2(Minor) : Regular health examination by a doctor for workers in station or exposed to high risk work.

NCR No. 2011-16 of 34 It was found regular health examination has not been done for two workers in engine room machines which have high level noise. Corrective Action: Company conducted Audiometric test for all worker in engine room on November 2011, in Health and Hy-giene Agency (Balai Hiperkes) Jambi Province. Corrective action : Identify all section which has high risk for wokers and make program for medical check-up once a year in Health and Hygiene Agency (Balai Hiperkes) Jambi. Auditor Conclusions: Open, raise again as a non con formities Audit Verification Findings : There is no evidence the company has conducted audiometric test for two workers in engine room ma-chines on November 2011. Company only conducted phisically medical test for all workers on December 2012.

Criterion 4.7.3(Minor) A documented risk assessment for Occupational Health and Safety (OHS)

NCR No. 2011-17 of 34 It was found that risk assessment for non routine activities such as purchase of spareparts by motorcycle has not done, although there was records of an accident that occured to a motorcyclist which resulted in loss of 10 man days Correction : Risk assessment for all company activities both routine and non routine activities will be done at least by December 2011, including riding motorcycle for company’s operational activities.



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Corrective Action : Management representative will issue reminder letter to all section always update risk assessment and include the result as management review agenda for further action.

Auditor Conclusions: Open Audit Verification Findings : Risk analysis for non-routine activity (buying spare parts of motorcycle using) have done on September, 26, 2011 9.1 points. Activities using motorcycles, NR activity, and the danger hit / hit the risk of injury / in-juries / death, a total of 9, an important category. Control with the use of PPE and check the condition of the vehicle.The last updated document of risk analysis for activities in estate, mill, infrastructure, and la-boratory department (the identification of hazards and risk assessment for the area plantations, factories, infrastructure and laboratories), form AG-BC-FR-R-31 rev 01, was taken on January, 2, 2013, and an im-portant aspect of health and safety and control status form AG-BC-FR-R-32 rev 01 dated January 2, 2013 and discussed on the meeting agenda of P2K3.However, the company has not conducted an analysis of the risk of non-routine work such as roof replacement is currently being carried out by contractors and risk analysis of the waste pond laundering activities.

Criterion 4.7.6.(Minor): Evidence of OHS and first aid equipments available at worksites

NCR No. 2011-18 of 34 The company still does provide protective tools to move soda ash and nalco to mixing tanks, and this condition causes workers to become sick with shortness of breath and excessive chemical spillage on the floor.

Correction : - Corrective Action : Provide palette to prevent slippery and split the packaging into smaller package. Issued instruction to all workers in this section shall use appropriate mask and other relevant protective equipment.

Auditor Conclusions: Closed Audit Verification Findings : Worker in Water Treatment Station using appropriate mask and split the packaging of soda ash and Nalco (50 kg) into smaller package (25 kg) before move it to mixing tank. Health and safety equipment such as boxes and Safety Sign P3K available sufficient either in the office, factory, warehouse and work-shop area.

Criterion 4.7.8 (Minor) Records of the occurrence o f any work accidents are maintained and regu-larly reviewed.

NCR No. 2011- 19 of 34 Investigation of the cause of occupational accidents and its losses are not carried out by the safety and health committee for all accidents that occur as required by accident investigation procedure AG-SMK-P-S-01, such for an accident which occurred on May 3, 2011 which resulted in a loss of 21 working days. Correction : Investigation was done for this accident was done on May 03, 2011 and the investigation report is kept in document control office.

Corrective Action : To carry out identification of all location or activities which is has potential danger and give protection to prevent accident.



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Auditor Conclusions: Closed Audit Verification Findings: Investigation report of accident on May 3 was done on May 30, 2011 carried out by safety and health committee (P2K3). Investigation reports for all accidents during 2012 and 2013 were done.

Criterion 4.7.8(Minor):Records of the occurrence of any work accidents are maintained and regu-larly reviewed.

NCR No. 2011-20 of 34 During OSH meeting on May 2011 and June 2011, there were no records evidence of the occurrence of any work accidents are maintained and regularly reviewed by safety and health committee. Correction : Investigation the cause of accident and their correction was discussed during OSH committee meeting on October, 2011. Records of review process were maintained by document controller.

Corrective Action : For next 2012, head of OHS will make “One year meeting program” Include the agenda of meeting. Man-agement will review the agenda for adequacy..

Auditor Conclusions : Closed Audit Verification Findings : OSH committee discussed the accidents which happen in the monthly meeting. There are Annual Work plan and its realization of OSH Committee year 2012 and 2013 (Work Program and Realization P2K3 in 2012 and 2013). In the OSH minute of the meeting on March 18, 2013, there were agenda discussions on accidents that occurred in the months and instruction to minimize the loss of working days and to reduce the number of accidents. After the meeting, the committee submit work report accidents to management (HRD). The Company make Quarterly Report Implementation of P2K3 (Trustees Committee salvation and Occupational Health) and submit a report to the head of the Office of the Ministry of Manpower and Transmigration Kabupaten Tanjung Jabung Barat, with proof of receipt.

Criterion 5.2.2 (Major): If, rare, threatened or en dangered species, or high conservation value habi-tats are present, appropriate measures to preserve them are to be taken.

NCR No. 2011-21 of 34 HCV assessment has been carried out but management does not have action plan and appropriate measure to preserve rare, threatened or endangered species and highly conservation value habitats. Correction : Company make action plans to manage and monitoring all identified HCV monitoring.

Corrective Action : Implementation of HCV management and monitoring plan will be monitor by Management Representative and will be reported during management review meeting. Training will be conducted for HCV officers to improve their knowledge and their capability for making HCV management and monitoring plan.

Auditor Conclusions : Open, raise again as a non co nformities Audit Verification Findings : The company was have action to preserve the HCV, with the appoint the person in charge for HCV based on memo Number 196A/BUH/BSP-JBI.I/X/11, and the company has manage the HCV with installation of signboard in the HCV area, and plant for reforestation in along in the Brasau River. The company has a management plan for HCV, but the company still no follow up the management plan especially for moni-



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toring, measurement, preserve and protect the species in the HCV report.

Criterion 5.2.1 (Minor) : Posters and signs warning of the presence of protected species are to be produced, distributed and made visible to all worke rs and the community, including guidelines in handling them.

NCR No. 2011-22 of 34 Posters and signs warning of the presence of protected species are not available; company only put warning board about “Ilegal Hunting Restrictions” and “Protected Forest”. There is also no guideline avail-able regarding how to protect these species. Correction : Posters and signs warning of the presence of protected species are to be produced in several places such as identified in front of HCV area, housing area, entrance gate to plantation area, and in front of head of village office. Company made working.

Corrective Action : Program communication regarding how to protect rare and endanger species and inform about signs warning board to workers and they family will start in the beginning of year 2012. Auditor Conclusion : Closed

Audit Verification Findings : The company has put signboard in the HCV area and side of the main road, but there is no signboard in the housing, and mill and others area. The company was conducted the HCV socialization for em-ployee was held on January 17, 2013 in the meeting room, and was attended by 22 participants, and socialization for external community was held on 2011 through the public consultation.

Criterion 5.2.2 (Minor) Companies are to appoint de dicated and trained officers to monitor any plans and activities as above

NCR No. 2011-23 of 34 The company has not appointed dedicated and trained officers to monitor plans and manage activites of appropriate measure to preserve HCV areas. Correction : Company assigned a team to manage and monitor HCV area; team coordinator will be trained by a con-sultant.

Corrective Action : Made training program for all HCV team member by year 2012

Auditor Conclusions: Raise again as a nonconformiti es Audit Verification Findings : The company appointed person in charge for HCV management based on memo Number 196A/BUH/BSP-JBI.I/X/11, but the PIC has no yet competence for HCV.

Criterion 5.4.2 (Minor). Records of monitoring rene wable energy use and its efficiency analysis (energy/ton CPO, or energy/ton palm product)

NCR No. 2011-24 of 34 There is no record on analysis of efficiency of renewable energy and fossil fuel usage based on monitor-



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ing of fuel consumption result. Correction : Efficiency analysis of fiber and shell consumption has been made including fossil fuel consumption for operational activities. This information will be reported to management representative for further action.

Corrective Action : Efficiency analysis of shell, fiber and fossil fuel consumption will be conducted periodically following result of monitoring of shell, fiber and fossil fuel consumption every month. Management representative issue remainder memo before end of month

Auditor Conclusions: Closed Audit Verification Findings : It was verfiied at Agro Mitra Madani Mill has monitor consumption of shell, fiber and fossil fuel and anlysis efficiency of fossil fuel consumption. As seen on Analisys energy used year 2012, it was stated that if company did not use fiber and shell for boiler fuels, to produce 1 ton FFB the mill need 77.25 liter diesel oil. Current condition company use fiber and shell, diesel oil only used for start up and shut down boiler, disel oil consumption very less i.e. 0.6 liter for 1 ton FFB process.

Criterion 5.6.1(Major): Evidence of identification of pollution and emissio ns sources at mills

NCR No. 2011-25 of 34 The company does not have GHG emission identification and reduction programme. Correction : Made identification of GHG emission source in mill and estate and planning to reduce GHG emission for short term period company conduct routine maintenance program, such as for boiler, genset, company’s vechicle and company require to all FFB transporter to switch off their vehicle engines while queuing to enter the weighbridge.

Corrective Action : Revised the procedure of identification environmental aspect and impact procedure to include source of GHG emission into the object of assessment process, and review periodically for updating information. The company has planning for methane gas capture from effluent pond and make it into biogas in long term period. The process now under feasibility study.

Auditor Conclusions : Closed Audit Verification Findings : Company has document about source of GHG emission for PT AMM such as effluent pond, EFB storage, operation machines, boiler operation, FFB and CPO transportation, chemical material storage. Company’s planning has CDM program however, du to financial problem, management decide to postpond the pro-gram. Company changes their program to reduce pollution and emission through saving energy diesel and electric consumption as founded in PT Agromitra Madani palm oil mill and PT Agrowiyana estate. Compare will last year condition company has money saving from diesel consumption this is inline with corporate program financial efficiency.

Criterion 5.6.1(Minor): Records of efforts and stra tegies employed to reduce pollution and emis-sions NCR No. 2011-26 of 34 There are no efforts and strategies employed to reduce pollution and emissions. Correction :-



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Corrective Action : Company has planning for methane gas capture from Effluent pond and make it into biogas in long term period. The process now under feasibility study.

Auditor Conclusions: Closed with observation. Audit Verification Findings : Company has methane gas capture to reduce GHG emission through CDM program however, due to fi-nancial problem, management decided to postpond the program. Company change their program to re-duce pollution and emission through saving energy such as saving diesel and electric consumption as founded in PT Agromitra Madani palm oil mill and PT Agrowiyana estate. Compare will last year condition company has money saving from diesel consumption this is inline with corporate program efficiency.

Ceriterion 5.6.2 (Minor): Records of efforts and st rategies employed to reduce pollution and emis-sions. Records of identification, monitoring, and treatmen t methodology for POME

NCR No. 2011-27 of 34 From the mills latest RKL / RPL implementation monitoring report, there are some results of analysis of chemical parameters that have exceeded the specified standard, e.g. the river analysis results of Giring River (which flows through the estate) for BOD, COD, and oil & grease, ammonia emissions from the KOMATSU generator, and some chemical parameters for clean water. But in this report there was no analysis of why the quality standards were exceeded and no evidence of corrective action taken by the mill Correction: Due to some mistake during taking water sample, RKL and RPL report document has been revised and company’s make coordination with Environemntal Officer in Tanjung Jabung Regency Officer (BLHD/Badan Lindungan Hidup Daerah) to get re approved report of RKL/RPL document through retake sample from the field for related environmental parameter. Corrective Action: Identify the cause of problem and analyze especially for environmental parameter which is exceed de-fined standard to make next action plan. Auditor conclusions: Open raise again as a non conf ormities Audit Verification Findings : The company has conducted correspondence with Environmental Bodies about the mistake of the river name on the analysis report number 660/LHU/LJ2JBI/XI/10, but the company stills no follow up the work program to analyzed result of monitoring because the result showed that the BOD, COD, oil and grase, TSS, pH is above than standard required. And based on next analyzed result on June 10, 2011 with the same sampling point for the parameter of BOD, COD the result still upper than standard required. Criterion 6.1.1(Major);Documented environmental and social impact assessment, including details of positive and negative social effects that may be caused by plantations and mills, and docu-mented participation of affected parties and local communities NCR No. 2011-28 of 34 Document social impact assessment does not state clearly all determined positive and negative impacts from company’s activities and there no evidence of participation of relevant stakeholders during impact identification activities. Correction : Correction SIA report with additional information about positive and negative social effect caused by es-tate and mill to stakeholders.



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Corrective Action: Review of SIA reports periodically and include additional positive and negative impact according to ongo-ing condition and always communicate with relevant stakeholder to improve SIA document including de-velopment of impact management and monitoring plan.

Auditor Conclusions: Open raise again as non confor mities Audit Verification Findings: The company has reports periodically the SIA, but still not include the negative impacts affected by the communities.

Criterion 6.1.2 (Minor): Regular monitoring and man agement of social impact, with the participa-tion of local communities

NCR 2011-29 of 34 There is no document of monitoring and management plan for identified social impacts which has been established through participatory method. Correction : Document for management and monitoring social impact has been made through participatory method with facilitated by external consultant. Social impact management will be combined with company’s Community development program or CSR program, next 2012 year, because for year 2011 the budget for CSR and Community development (Comdev) has been approved and cannot be revised.

Corrective Action : Company’s ComDev’s division will make review about social impact management and monitoring plan and include the planning of yearly action plan program to be implemented by the company’s own estates.

Auditor Conclusions : Closed Audit Verification Findings : The company has social impact management and monitoring plan, and the document contain information about action plan for guidanced of companies action.

Criterion 6.1.4 (Minor): Particular attention paid to the impacts of outgrower schemes (where the plantation includes such a scheme)

NCR No. 2011-30 of 34 The company’s Social Impact Assessent document does not cover the impacts of outgrower schemes (where the company has smallholder scheme). Correction: Revised Social impact document include information about impacts of outgrower schemes

Corrective Action: Community development division will always inform to management representative if there any activities both new activities or existing activities will be consider to revised social impact assessment document.

Auditor Conclusions: Closed Audit Verification Findings : The company has put the social impact assessment of smallholder actvities in the social impact manage-ment plan.



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Criterion 6.2.2 (Minor): Records of local communiti es’ aspiration and responses or follow up ac-tions by companies to these requirements

NCR No. 2011-31 of 34 There are some stakeholder requests and responses from the company which were not recorded, for ex-ample, according to interview result with villagers from Brasau village, they already send their request re-garding road maintenance, however the company did not have records of responses or follow up actions for this incoming request Correction : Community aspirations are to be been documented as required by record keeping procedure. Corrective Action : The company will regularly monitor incoming information about community aspiration periodically during stakeholder forum, and record it properly as determined by relevant procedure. .

Auditor Conclusions: Closed Audit Verification Findings : The company has record for request and response from the stakeholder communications and aspiration through the log book, and the company was consisten to record every incoming letter in to the company.

Criterion 6.3.1 (Major): An open system, which is a ccepted by affected parties, to receive com-plaints and to resolve dispute in an effective, tim ely and appropriate manner

NCR No. 2011-32 of 34 There is no evidence that the company’s mechanism to receive complaints and to resolve dispute was accepted by relevant affected parties. Correction: Communication with stakeholders and made evidence that stakeholders accept with these system. Im-prove the function of worker union as media for communication among workers and or workers with man-agement.

Corrective Action: The company has established a stakeholder’s communication forum to facilitate any grievances from stakeholder surrounding company’s area.

Auditor Conclusions: Open, raise again as non confo rmities Audit Verification Findings : The company has procedures SOP AG-SMM-P-S-02-Rev00 but there is no evidence that the SOP was accpted by the affected parties.

Criterion 6.9.1(Minor): Proof of implementation of sexual harassment policy

NCR No. 2011-33 of 34 There is evidence that company has not effectively communicated their policy regarding prevention of sexual harrassment and all other forms of violence against women to all workers, as from interview re-sults most of the workers interviewed still not understand about this policy. Correction :



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Policy on prevention of sexual harassment policy and all other forms of violence has been communicated to all woman workers in each plantation division

Corrective Action : The company has put additional morning briefing agenda including information about prevent sexual har-assment and inform regarding the punishment to the relevant parties if such a case occurs. Auditor Conclusions : Closed Audit Verification Findings : The company has put of prevent sexual harassement in to the morning breafing agenda every days, based on interviewed with some workers she’s said that every morning breafing the foreman was told about the sexual harassement.

Criterion 8.1.1 (Major): A monitoring action plan b ased on the social environmental impact as-sessment, and regular evaluations of plantation and mill operations. As a minimum, these must in-clude, but not necessarily be limited to: • Reduction in use of certain chemicals (criterion 4.6). • Environmental impacts (criterion 5.1). • Waste reduction (criterion 5.3). • Pollution and emissions (criterion 5.6). • Social impacts (6.1).

NCR No. 2011-34 of 34

There is no evidence that the mill or estate has a monitoring action plan for the following aspects: • Reduction in use of certain chemicals (criterion 4.6). • Waste reduction (criterion 5.3). • Pollution and emissions (criterion 5.6). • Social impacts (6.1). Correction : The company made program to reduce agrochemical usage, reduce hazardous waste and monitor the implementation periodically. Pollution and emission always monitor every six month and reported together with RKL/RPL report. Social impact will be monitor as determined on SIA management and monitoring plan.

Corrective Action : Te company made procedure Integrated with ISO 14001, Proper (‘Program Penilaian Peringkat Kinerja Perusahaan’ or Company Performance Assessment Program) conduct by Ministry of Environment , and CDM composting and monitoring of trend for reduce of waste, agrochemical usage, emission, pollution and social impact on a certain period.

Auditor Conclusions : Open, raise again as non conf ormities Audit Verification Findings : The company has reduce/eliminate their chemical used based on company records, but there is no doc-umented evidence about management’s policy regarding reduce of chemical used, waste, pollution and emssion. For waste reduction the company still not followed the procedure and the company still not yet inventarization of emission source from their activity.

3.3 Identified Non-conformances, Corrective Actions Taken and Auditors Conclusions

During this surveillance assessment, a total of 29 nonconformances were identified. These consisted of 21 major non-conformities and 8 minor non-conformities, and 11 raise again as a non conformities. For the major



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non-conformances, the company has taken the necessary corrective action to close these non-conformances within 60 days of completion of the assessment, and this was verified by the audit team through document that submitted by the company. For the minor non-conformances, the company has taken corrective action against these as well, and for those which could not be verified as closed through document checks, the clo-sure of these minor non-conformities will be assessed during the next surveillance audit. A summary of all identified non-conformances, corrective actions taken and auditor conclusions is as below:

Criterion 2.1.1 (Major) Evidence of compliance with relevant legal requirements

NCR No. 2013 – 01 of 29; Major

1. There is found that the hazardous waste was delivered more than the 90 days based on manifest record December 17, 2012 and April 18, 2013 (raise again as a non conformities).

2. There is found that license for CV Surya Jaya as hazardous waste transportation had not valid during the surveillance audit.

3. It was found the record of hazardous waste from central store to licensed hazardous warehouse is almost 2 month, where the central store did not have a license for hazardous waste storage.

4. There is found that the agrochemical in the estate does not have recommendation licensed from Labour and Transmigration Head Offices (related to CR 4.6.1)

5. There is found that the operator for heavy equipment is not valid when they work. 6. There is found that the contractor workers of CV AMS is under age 7. There is no found evidence for proof of payment for work insurance (JAMSOSTEK) for all worker

in April, May and June 2013 (related to CR 4.7.1) Correction:

1. The company has already licensed extend permit for retention time for hazardous waste with let-ter of permit for retention time of hazardous waste number 660/551/BLH on June 24, 2013 Issued in Kuala Tungkal from Environmnetal Bodies Offices Regency of Tanjung Jabung Barat, with new retention time is 180 days, and valid from issued.

2. The licensed of hazardous waste transportation for unit transport of BH 8419 AO has already ex-tend permit with letter number SK.2910/AJ309/DJPD/2013/150710344BB-0001 from Ministry of Transportation, Directorate General of Road Transportation and valid until May 7, 2014, and for transportation unit number BH 8535 MK has already extentio permit with letter number SK.2910/AJ309/DJPD/2013/150710344BB-0002 from Ministry of Transportation, Directorate General of Road Transportation and valid until May 7, 2014

3. The company has already internal memorandum about retention time of hazardous waste date is-sued on August 28, 2013, state that the retention time for hazardous waste on central store max-imal in 7 days.

4. The company has already delivered letter number 384/PRSN-BSP/JBI/VIII/2013 on August 2nd, 2013 about request for registered of chemical used in work place to Head Offices of Labour and Transmigration of Tanjung Jabung Barat Regency, and has receipt evidence on August 04, 2013 (related to CR 4.6.1)

5. The company has already extend the licensed for heavy equipment operator, and was valid until July 2018.

6. The company has already termination of employment under age based on record Number SK.122/HRD-AMS/VII/13 on July 19, 2013, and the contractor has a comitmen for wokers under 18 years old based on letter statement on July 18, 2013.

7. The company has payment for work insurance (JAMSOSTEK) for all workers in April, Mei and June 2013 based on evidence of proof payment by bank transfer.

Corrective Action:

1. The company has commitment to ensure the hazardous waste was delivered to collector licensed maximal in 180 days, and the company was change they hazardous collector licensed from CV Surya Jaya Logam to PT Bintang Mas Cahaya International based on agreement letter Number SPK.103/AMM/AH/VIII/2013.

2. The company has commitmen to ensure that the unit for hazardous waste transport is always val-id for traportation by checking the licensed and if found the licensed is almost not valid, the com-pany will be send a letter or email or telephone to the collector to extend the licensed.

3. The company has commitmen to ensure that the hazardous waste from division to central store is only 7 days maximal and after that will be delivered to hazardouse warehouse licensed.



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4. The company has already delivered letter for registered they chemical used and ensure that all chemical in the company was registered in Pesticides Comission Book and Head of Labour and Transmigration of Tanjung Jabung Barat Regency

5. The company has already extend the licensed for heavy equipment operator and ensure that all of operator has valid licensed

6. The company will be ensure that all of internal workers and workers from contractor is above 18 years old.

7. Because the company has economic efficiency program and economic problem, so they can not pay out the JAMSOSTEK. Next, the company will be ensure that they implemented of JAMSOSTEK Regulation and Regulation of Employment

Auditor Conclusions: Closed Verification result; Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next au-dit. Date of closure: September 4 th, 2013

Criterion 2.1.2 (Major) Evidence of efforts made to comply with changes in the regulations

NCR No. 2013 – 2 of 29 There is found that the regulation update is not complie with the company SOP’s AG-SMM-P-S-03 Rev 01, page 3 ponit 6.2.4. Correction: The company has already assign responsibility to DCC (document control central) for update law and regulation in page 3 of procedure AG-SM-R-26. And the company has already withdrawal of not valid law and regulation from the list of law and regulation document. Corrective action: The company will be ensure that all of law and regulation update is meet with they procedure and every update the company will be provide the evidence. Auditor Conclusions: Closed Verification result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013

Criterion 2.2.2 (Minor) A mechanism to resolve conf lict which is accepted by all parties

NCR No. 2013 – 3 of 29 There is no record of the SOP of conflict resolution be accpeted by the communities and others stake-holder. Correction: The company has socialize their SOP about conflict resolution and was accepted by all parties evi-dence by minutes of meeting and was signed by all stakeholders Corrective action:



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Documentation for mechanism of grievence and conflict resolution and ensure that all of the problem related to grievence and problem resolve is refer to this SOP and should be documented. Auditor Conclusions: Closed Verification result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013

Criterion 3.1 (Major) There is an implemented manag ement plan that aims to achieve long-term economic and financial viability

NCR No. 2013 – 04 of 29 Theres is no found record for fertilizer application in 2012 based on budget fertilizer in 2012 (related to CR 4.2.2 minor) Correction: The company has submit the correction for fertilizer application. In budget 2011 the company was alocat-ed budget for fertilizer application, but there is no realization because the company carry out the eficiency budget in 2011, so in 2012 to replace the fertilizer application the company applicated the compost fertiliz-er based on Letter number 42/CEP/Jkt/X/2011 on October 21st, 2011 about the recommendation fertilizer in 2012, state for PT Agrowiyana, fertilizer compost application is for 4,000 Ha area’s with dosage is 10 tonne/Ha. And the company was realized compost application for 4,000 Ha areas’s based on memo num-ber AH-BSP/JBI/I/2012 on January 2nd, 2012 about the compost application. Corrective Action: The company will be ensuring the fertilizer application is based on recommendation and situation of the company. Auditor Conclusions: Closed Verification result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013

Criterion 4.2.1 (Minor) Records of regular soil, le af, and visual analysis

NCR No. 2013 – 05 of 29; Minor There is no found the record of leaf analysis periodically for 2012 Correction: The company has conducted the leaf analisys in 2012, based on correction leaf analisys record in 2012 for Jambi Area 1, PT Agrowiyana. Corrective action: The company will ensure periodically leaf analysis every year. Auditor Conclusions: Closed Verification result:



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Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013 Criterion 4.2.2 (Minor) Records of efforts to maint ain and increase soil fertility (e.g. the use of fertilizer, legume cover crops, compost, and land a pplications of POME or EFB) based on the results of analysis carried out as in Point 1 above NCR No. 2013 – 06 of 29; Minor Fertilizer recommendation in 2011 for urea application is about 10,123 kg’s but in 2012 there is no found record of realization for this fertilizer. Correction: The company does not realized the urea fertilizer application in 2012 because the company has carry out eficiency budget in 2011, so fertilizer applied changed to the fertilizer compost based on Letter number 42/CEP/Jkt/X/2011 on October 21st, 2011 about the recommendation fertilizer in 2012, state for PT Agrowiyana, fertilizer compost application is for 4,000 Ha area’s with dosage is 10 tonne/Ha. And the company was realized compost application for 4,000 Ha areas’s based on memo number AH-BSP/JBI/I/2012 on January 2nd, 2012 about the compost application. Corrective Action: The company will be ensure the fertilizer application is based on recommendation and situation of the company. Auditor Conclusions: Closed Verification result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013

Criterion 4.3.4 (Minor) Subsidence of peat soils sh ould be minimised under an effective and documented water management programme.

NCR No. 2013 – 07 of 29; Minor There is no found that the water management on peat land no represent for all depth peat on the compa-ny (raise again as a non conformities) Correction: The company has submit for correction for program installation of water level sampling, water table and subsidence location. Based on map of work program, water level, water table and subsidence will be installation on file numbe B35, C35, and D31 in Division 5. Corrective action: The company ensure that procress water level, water table and subsidence on peat will be represent for all peat depth, and the company will be monitored periodically. Auditor Conclusions: Closed Verification result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit Date of closure: September 4 th, 2013



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Criterion 4.4.2 (Minor) Monitoring of effluent BOD

NCR No. 2013 – 8 of 29 ; Major The company still not conducted of analysis and problem identification for result of monitoring water quality analysis, because the result is more than the standart required (NCR. 2011 – 27 of 34 ) raise again as a non conformities. Correction: The company has analyze and identification for water quality analysis result. Based on record of problem indentification on July 20, 2013. From the problem identification showed that the root cause analysis is there is no identified the the problem, because the upstream the river is not in the area’s company but it so far from the company, and the company not dispose they waste water in to the environmental, but the company use the waster water for land application and the location is so far from the river. The company still conduct the water analysis periodically to ensure and maintain the quality of the water. Corrective action: The company has commitement to conduct the water analysis in the river a crossed they area to moni-tor and maintain the water quality. Auditor Conclusions: Closed Verification result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013

Criterion 4.5.1 (Major) An IPM plan is documented a nd current

NCR No. 2013 – 9 of 29; Major There is no found the record handling of Ganoderma attack in Division II. Because if refer to early warn-ing system record, the attack is high rate Correction: The company has submit correction for handling of Ganoderma attack with program for Genoderma at-tack control and work program to monitoring (census/early warning systems) and inventarization of loca-tion for Genoderma and isolated the infected area. The company a record of document for control of Ge-noderma attack in Division 2 on August 2013 until July 2014, when the process of control such as: cen-sus for location infected; mapping infected area; action (isolated for infected area, hand picking and burn). Corrective action: The company will be ensure that Genoderma attack will monitored by the early warning system and ensure the infected area should be isolated, and will be conduct gradually. Auditor Conclusions: Closed Verification Result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013



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Criterion 4.6.1 (Major) Evidence of use of only app roved and registered agrochemicals permitted by the relevant authorities

NCR No. 2013 – 10 of 29

1. There is found that the chemical in the estate does not have recommendation licensed from La-bour and Transmigration Head Offices (related to CR 2.1)

2. There is no found the record for company commitment to reduce/elimanate the chemical on 1A and 1B WHO and Rotterdam Convention (raise again as a non conformities)

Correction: 1. The company has already submit letter number 384/PRSN-BSP/JBI/VIII/2013 on August 2nd, 2013

about request for registered of chemical used in work place to Head Offices of Labour and Transmi-gration of Tanjung Jabung Barat Regency, and has receipt evidence on August 04, 2013.

2. The company has policy for reduce of chemical in type of 1A and 1B WHO and Rotterdam Conven-tion, was issued on August 1st, 2013.

Corrective action: 1. The company has already delivered letter for registered they chemical used and ensure that all

chemical in the company was registered in Pesticides Comission Book and Head of Labour and Transmigration of Tanjung Jabung Barat Regency

2. The company has commitmen for reduce/eliminate of chemical used from type of 1A and 1B WHO and Rotterdam Convention from each activity, and when during the audit the company showed that they was reduced gradualy by the evidence of realization of chemical used and purchased of chemi-cal in 2013.

Auditor Conclusions: Closed Verification Result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013

Criterion 4.6.2 (Minor) Records of the results of h ealth check-up for those who apply agrochem-icals

NCR No. 2013 – 11 of 29: Major 1. The Company has no proof of re-checking relevant worker who suffer breathing difficulties, lung tu-

berculosis and have cholinesterase level exceed and send them for further medical check program to ensure that they need further treatment, as presented at improvement of the NCR No.2011-14 of 34 (previous audit)

2. The company has no medical checkup periodically for all workers who related with agrochemicals for 2012

Correction: 1. Through the letter memo number 469/PRSN-BSP/JBI/IX/2012 on September 1st, 2012 to Estate

Head about the followed of medical chekup for workers from Division 6 and Division 4 from the HRD Team Leader. Then, the Estate Head was followed the memo by letter memo number 159A/EH-INTI/IX/2012 on September 15, 2012 about the followed of medical checkup result. Based on infor-mation from the memo, the workers are no longger work in the company, because the workers refuse to replace they work from the chemical work to manual work.

2. The company has carry out of medical checkup in 2013 for all workers evidence byrecord the result of medical checkup in 2013 and photograph.

Corrective action: The company will be ensure and consistent about the medical check up realization periodically for future.



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Criterion 4.7.3 (Minor) A documented risk assessmen t for Occupational Health and Safety (OHS)

NCR No. 2013 – 13 until 16 of 29: Minor 1. Was found that the workers not used the PPE when they work especially for work in altitude more

than 2 metters. 2. There is no found of risk assessment for temporary actvities in the company Correction: 1. The company has a letter for commitment on Monday July 1st, 2013 in 10.00 AM, was held in meet-

ing room of contractor (PT RMM), and the contarctor willing to follow of law and regulation about health and safety, and was sign on July 18, 2013 and equipped with photograph the PPE used by workers.

2. The company has job safety analysis for temporary activities such as: dredging POME ponds, sludge disposal from POME ponds, roof replace on the mill, welding, fabric painting.

Corrective action: 1. The company will be ensure that all of they contractor should be abide law and regulation about

health and safety, also the company make socialization for contractor workers before they start the work and ensure they PPE’s is complete.

2. The company was ensure all temporary activities in the company was include on the job safety analysis and make sure the job safety analysis is applied

Auditor Conclusions: Closed Verification result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013

Criterion 4.7.2 (Minor) Regular health examination by a doctor for workers in station or exposed to high risk work

NCR No. 2013 – 14 of 29; Major There is no record for regular health examination for 2 operators in enginee room in November 2011 (NCR No. 2011 – 16 of 34 raised again as non conformities) and the same record in 2012. Correction: The company has carry out the regular health examination for 2 operators in enginee room evidence by the result of medical checkup for all workers in 2013 and photograph. Corrective action: The company has a commitment to ensure that operator in enginee room will always be included in regular health examination periodically in the future. Auditor Conclusions: Closed Verification Result:



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Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013

Criterion 4.8.1 (Major) A documented training progr amme for staff, employee and scheme smallholders in accordance with workers’ positions and competences

NCR No. 2013 – 15 of 29; Major There is not found the training program and realization for smallholders Correction: The company has program for smallholders training in 2013 incorporated into 12 cooperation (KUD) when the topic in training discuss about manual handling, fertilizer application, IPM, production and harvesting, and open discussion. Corrective action: The company ensure that program will be carry out very well and documented. Auditor Conclusions: Closed Verification Result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013

Criterion 5.2.2 (Major) If, rare, threatened or end angered species, or high conservation value habitats are present, appropriate measures to prese rve them are to be taken.

NCR No. 2013 – 16 of 29: Major Theres no found impelementation record of management plan HCV especially for monitoring, measure-ment, preserve and protection (NCR No. 2011 – 21 of 34 ) raise again as a non conformities Correction: The company has conduct of spesies monitoring in the HCV area, based on record of monitored the con-dition of species was good and equipped with photograph, also the company has commitment for protect all the species in the HCV area Corrective action: The company make efforts to followed and realization the HCV management gradually, and ensure all the HCV management plan will be implemented periodically. Auditor Conclusions: Closed Verification result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013 Criterion 5.2.1 (Minor) Posters and signs warning o f the presence of protected species are to be produced, distributed, and made visible to all work ers and the community, including guidelines in handling them NCR No. 2013 – 17 of 29: Major There is no found signboard was installation in the housing, mill and others area (NCR No. 2011 – 22 of



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34) raise again as a non conformities Correction: The company has put the signboard in the housing, mill, office and others area. And the signboard was in-form about the prohibition for illegal hunting, illegal fishing, illegal logging, and high risk area for burn, chemist application. Corrective action: The company has commitmen for maintainance and monitored all the signboard was install and will be add a new signboard if need for new location. Auditor Conclusions: Closed Verification Result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013

Criterion 5.2.2 (Minor) Companies are to appoint de dicated and trained officers to monitor any plans and activities as above

NCR No. 2013 – 18 of 29; Major Company has assign the HCV PIC for manage the HCV area, but the person have no yet training for HCV (NCR No. 2011 – 23 of 34 ) raise again as a non conformities. Correction: The company has assign of the HCV PIC by the vidence is certificate of Technical training assess-ment of HCV Value Area on 4 – 8 April, 2011 which focus to manage and ensure that HCV area is al-ways protect from illegal activites and to increase the HCV value in the area. Corrective action: The company ensures that the PIC of HCV area carry out and maintenance the HCV management plan. Auditor Conclusions: Closed Verification Result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013

Criterion 5.6.1 (Major) Evidence of identification of pollution and emissions sources at mills

NCR No. 2013 – 20 of 29: Major List of identification pollution and emission of the company still not covered all activities Correction: The company has list of identification pollution and emission for all activities contribute to GHG by the record of identification of environmental aspects and impacts, such as: is peat land on the area, fossil fuel, land clearing fertilizer application and etc. Corrective action: The company ensure that all of activites contribute to GHG emission was put in to list of identification pollution and emission



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Criterion 5.6.2 (Major) Monitoring of pollution and emission quality of the sources identified

NCR No. 2013 – 21 of 29: Major There is no found evidence of realization to monitoring and mitigation for GHG Correction: The company has list invetarization of GHG emission from the estate and mill activities within in 3 years period. Corrective action: The company has commitment to monitor the emission quality from the emission source and pollution was produce from the astate and mill activites such as FFB transport, heavy equipment, EFB application, fossil fuel, genset housing, within 3 years period. For the monitoring of emission and poillution the com-pany will be conduct the emission analysis. Auditor Conclusions: Closed Verification Result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013 Criterion 6.1.1 (Major) Documented environmental an d social impact assessment, including de-tails of positive and negative social effects that may be caused by plantations and mills, and documented participation of affected parties and lo cal communities NCR No. 2013 – 22 of 29; Major There is no found report of management and monitoring of social impact assessment was included the negative impact from the company activities Correction: The company has report of management and monitoring of social impact assessment was included the negative impact from the company activities for periode of January – Juni 2013 with 3 negative impacts was identified on the report. Corrective action: The company will be ensure, all of the negative impact based on SIA and EIA document will be moni-tored periodically. Auditor Conclusions: Closed Verification result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013



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Criterion 6.1.1 (Minor) Regular monitoring and mana gement of social impact, with the participa-tion of local communities

NCR No. 2013 – 23 of 29; Minor There is no found record of management and monitoring of social impact was accepted by all stake-holders Correction: The company has matrix for social impact management plan with the participation of the local commu-nities evidence by minutes meeting between companies management with local communities, when the local communities has signed Corrective action: Documentation for social impact management plan with participation of the local communities. Auditor Conclusions: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013

Criterion 6.2.1 (Major) Documented procedures and r ecords of communication and consultation with the communities.

NCR No. 2013 – 24 of 29: Major There is no found record documentation of SOP consultation and communication was accepted by the affected communities Correction: The SOP communication and consultation has involve the communities and others related stakeholder by the evidence of list of signed about the socialization and transfer of procedur number AG-SM-R-24 about communication and consultation to communities and local village government. Corrective action: Ensure that all of procedure related to consultation and communication to communities and related stakeholders should be accepted together Auditor Conclusions: Closed Verification result: Date of closure: September 4 th, 2013

Criterion 6.3.1 (Major) An open system, which is ac cepted by affected parties, to receive com-plaints and to resolve dispute in an effective, tim ely and appropriate manner

NCR No. 2013 – 25 of 29; Major There is no found that the mechanism of grievence was accepted by the affected communities Correction: The company has mechanism of grivence and conflict resolution, and also has accepted by the com-munities and related stakeholders evidence by list of signed socialization and transferred the procedure AG-SMM-P-S-02 to all communities such as Village local government, cooperation, Head of Village, etc. Corrective action: Documentation for mechanism of grievence and conflict resolution and ensure that all of the problem



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related to grievence and problem resolve is refer to this SOP and should be documented. Auditor Conclusions: Closed Verification Result: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013

Criterion 6.5.2 (Minor) Agreements entered into wit h contractors are to specify that contractors abide by labor laws

NCR No. 2013 – 26 of 29; Minor There was found on the SPK (letter agreement for contractor) not consistent about the compliance of labour law and regulation Correction: The company has revised their letter of agreement to contractor related to compliance of law and regu-lation example on letter of agreement on June 5, 2013 in clause 9.4 was state the contractor should be compliance to law and regulation. Corrective action: The company ensure that all of letter agreement, that the contractor should be compliance to law and regulation. Auditor Conclusions: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013

Criterion 6.11.1 (Minor) Records of company contrib utions to the local development

NCR No. 2013 – 27 of 29: Minor There is no found record of realization for CSR program related to company contributions Correction: The CSR realization is not based on budget, but it is depand of initiative and realistic from the company Corrective action: The company ensure that all of CSR realization should be documented Auditor Conclusions: Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013

RSPO Certification Requirement No 4.2.3

NCR No. 2013 – 29 of 29 There is no found the program and realization for smallholder certification process preparation. Correction:



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The company has submit the smallholders program, the contain was inform about the RSPO introduc-tion and best practice training for palm oil. Corrective action: The company has a commitment to certified they smallholders through the smallholders certification program. Auditor Conclusions: Closed Evidence of immediate action taken was accepted. Effectiveness of implementation to verified at next audit. Date of closure: September 4 th, 2013



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3.4 Description of Supply Chain Management System PT Agro Mitra Madani Palm Oil Mill is producing crude palm oil (CPO) and palm kernel (PK), the audit time has not register their transaction in the RSPO E-Trace System, because company currently sell their product without claim-ing it as certified sustainable palm oil (CSPO) or certified sustainable palm kernel (CSPK), all CPO produced from PT Agromitra Madani Mill are sold as regular product. However according to explanation from mill manager, the company will follow all requirements from RSPO to support implementation of sustainability requirements. The following is a description of the company’s supply chain management system according to the RSPO SCCS requirements, including status of compliance of the company and their outsourced third parties to RSPO SCCS re-quirements:

1. Documented procedures

Findings: The company has list of procedures for incoming FFB until product dispatch, currently company implement Quality Management System ISO 9001: 2008, all procedure incorporated in company together with procedure for receiving order available in sales department and mill, There are procedure for recieveing and processing FFB i.e: - Incoming FFB procedure (Aturan/perintah kerja yang harus diketahui petugas penerimaan

buah/TBS(timbangan)) AG-SMM-WI-L-01 rev 03 dated May 31, 2010 - FFB grading procedure (Aturan Perintah kerja yang harus diketahui petugas pensortiran buah)

AG-SMM-WI-L-02 rev 06 dated May 01, 2011 - Grading Specification (Spesifikasi Sortasi) AG-SMM-SP-L-01 rev. 04 dated March 16, 2013 Both procedures for receiving and processing still not inform about mechanism for receiving certi-fied and non-certified FFB neither processing certified and non-certified FFB. I regard to RSPO SCCS requirement, and implementation company has no assign person who has responsibility and authority over the implementation of SCCS requirements. This is raised as non conformtities. Compliance status: Non Compliance

NCR 2013-SCCS-01 of 08 There is no assign person who has responsibility and autority over the implementation of SCCS requirements.

NCR 2013-SCCS-02 of 08 Both procedures for receiving and processing still not inform about mechanism for receiving certi-fied and non-certified FFB neither processing certified and non-certified FFB.

2. Purchasing and goods in

Findings: The facility has mechanism to verify both volume and quality of Incoming FFB as stated on 3 pro-cedures incoming FFB above, incoming FFB will be recorded on : 1. From home-grown (PT Agrowiyana Planttaion) accompanied by "Nota Angkut Buah (AGW-SMM-FR-E 25) rev. 01; Bukti Penerimaan TBS (from weighbridge) AG-SMM.99.9.14 and Slip Sortasi (AG-SMM-FR-L-01) 2. From Smallholder scheme accompanied by Delivery notes call “ Nota Angkutan buah from smallholder”; Receiving Note “ Bukti Penerimaan TBS”; and Grading Document “Slip Sortasi “ 3. From independent outgrower accompanied by Delivery Note “Nota Angkutan Buah” ( Bengkel-ing 1/kopkar/2013; Bukti Penerimaan TBS and Slip Sortasi TBS



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However there is no information about certified status on all documents stated above and compa-ny has no mechanism to verify incoming certified FFB and non-certified FFB. To accommodate overproduction considering eligibility of certified product company required to make mechanism to inform the CB immediately if there is a projected overproduction, this is still not established by PT Agromitra Madani Mill and raised as non-conformities.

Compliance status: Non Compliance

NCR 2013-SCCS—03 of 08 There is no information about certified status on all documents stated above and company has no mechanism to verify incoming certified FFB and non-certified FFB. NCR 2013-SCCS-04 of 08 The facility shall inform the CB immediately if there is a projected overproduction



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3. Records Keeping

Findings: The company’s mechanism for control and maintenance of the data and document used in pro-duction process, There is a procedure for records keeping i.e. AG-SMM-P-L-01, however the retention time for records keeping only 2 years instead of 5 years. The mill has records balance for all receipts of RSPO certified FFB and delivery CPO on daily basis. The material balance includes information about incoming FFB from company’s estate and out grower, FFB produced, CPO result including OER, however records for PK production and monthly movement has not established. All volumes of palm oil that are delivered are deducted from the material accounting system ac-cording to actual daily conversion rate. There is a records of material balance , however infor-mation on material balance is not included about product dispact report. Only state incoming FFB and processing including quantity of product. This is raised as non-conformity. Daily pro-duction report stated on AG-SMM-FR-P-11. Selected supply chain model still not stated on company’s document. There is no outsourced process in PT Agromitra Madani Mill. The mill’s product CPO and palm kernel are internally processed in company’s location. Compliance status: Non Compliance NCR 2013-SCCS-05 of 08 There is a procedure for records keeping i.e. AG-SMM-P-L-01, however the retention time for records keeping only 2 years instead of 5 years.

NCR 2013-SCCS-06 of 08

There is a records of material balance , however information on material balance is not included about product dispact report. Only state incoming FFB and processing including quantity of product.

4. Sales and Good Out

Findings: The sales and goods out mechanism of the company are described in their procedure of sales of palm oil. Records of all sold RSPO certified materials are recorded in material balance sheet. All documents related product dispatch sales invoice documents to buyer and other customer are: - Weight bridge ticket - Delivery Order - Vehicle Control Form - Minutes meeting ( "Berita Acara” ) - Surat Pernyatan Truck/ Tanki Bersih (Cleaning Tank statement) The name of buyer has been informed on Weigh Bridge Slip and Delivery Order, including infor-mation about address of the buyer. The sales document has been include information about the date on which the invoice was issued, however the sales and dispatch product documents still not in-clude information about selected supply chain model.

Compliance status: Non Compliance NCR 2013-SCCS-07 of 08 PT Agromitra Madani has not included selected supply chain model in all sales documents.



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5. Training

Findings: There is no training evidence for SCCS awareness for all relevant staff dealing with production and SCCS system implementation.

Compliance status: Non Compliance NCR No. 2013-SCCS-08 of 08 The facility shall provide the training for all staff as required to implement the requirements of the Supply Chain Certification Systems.

6. Claims

Findings: The company has specific SOP for making claims regarding the use of or support of RSPO certi-fied oil palm products product according RSPO communication and claims. The implementation of SOP is after company get order for certified palm oil or palm kernel.

Compliance status: Not applicable at this time.

3.5 Identified Non-conformances against RSPO SCCS R equirements, Corrective Actions Taken and Auditors Conclusions

SCCS Non-conformance 2013-SCCS-01 of 08: There is no assign person who has responsibility and autority over the implementation of SCCS requirements. Correction : Management representative to ensure compliance with SCS requirement has been assigned. Corrective Action: To impement SCCS requirement as well as needed according to job description and responsibilities. Date of closure : August 31, 2013 Verification result: Company provide assignment letter No. 109.B/AH-BSP/JBI/VIII/2012 regarding assignment Mr. Har-tanto as SCCS representative for ensuring SCCS implementation and SCCS compliances Auditor Conclusions: Closed. SCCS Non-conformance 2013-SCCS-02 of 08: Both procedures for receiving and processing still not inform about mechanism for receiving certified and non-certified FFB neither processing certified and non-certified FFB.



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Correction : Company made procedures for receiving and processing for certified and non-certified FFB G-SMM-FC-L-01. Company will implement Mass balance according to the nature of FFB suuplied to PT Agro Mitra Madani. Corrective Action: To implement the relevant procedure consistently. Date of closure : July 20,2013 Verification result: Company provide new working instruction regarding Incoming FFB in Agromitra Madani Mill as deter-mined on Form AG-SMM-FC-L-01 issued on July 20, 2013, the working instruction explain about re-ceiving certified and non-certified FFB neither processing certified and non-certified FFB. Auditor Conclusions: Closed. SCCS Non-conformance 2013-SCCS-03 of 08: There is no information about certified status in all incoming FFB documents and company has no mechanism to verify incoming certified FFB and non-certified FFB Correction : Certified status will be put in all incoming FFB documents. Company made mechanism to verified in-coming certified and non certified FFB as determined on AG-SMM-WI-L-25 Corrective Action: To implement the relevant procedure consistently according to SCCS requirement. Date of closure : July 20, 2013 Verification result: Company provides working instruction regarding guidance for marking and put identification about cer-tification status in all incoming FFB document to distinguish between certified and non-certified, as de-termined on AG-SMM-WI-L-25. Auditor Conclusions: Closed SCCS Non-conformance 2013-SCCS-04 of 08: The facility shall inform the CB immediately if there is a projected overproduction Correction : Company made procedure regarding how to communicate to the certification body if there is a project-ed over production as stated on AG-SMM-P-L-06 Corrective Action: To implement the relevant procedure consistently according to SCCS requirement. Date of closure : July 20, 2013 Verification result: Company provide new procedure regarding communication to certification body if there is a overpro-duction projected as determined on AG-SMM-P-L-06 issued on July 20, 2013. Auditor Conclusions: Closed SCCS Non-conformance 2013-SCCS-05 of 08: There is a procedure for records keeping i.e. AG-SMM-P-L-01, however the retention time for records keeping only 2 years instead of 5 years.



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Correction : Revise the records control procedure and require retention time for all relevant records into 5 years, as determined on AG-SMM-P-L-01, 14,15 dan 16 Corrective Action: To implement the relevant procedure consistently according to SCCS requirement. Date of closure : July 22, 2013 Verification result: Closed Auditor Conclusions: Company provide procedure AG-SMM-P-L-01 14,15 dan 16, for records keeping and found infor-mation that all relavant records for SCCS imlemntetaion wil be keep maintained for 5 years period. SCCS Non-conformance 2013-SCCS-06 of 08: There is a record of material balance; however information on material balance is not included about product dispatch report. Only state incoming FFB and processing including quantity of product. Correction : Information about produc dispatch has been included on daily production records form AG-SMM-FR-P-13 and Form AG-SMM-FR-P-11 dan Form AG-SMM-FR-P-13 as attached. Corrective Action: To Implement production report (AG-SMM-FR-P-11) and Form No(AG-SMM-FR-P 13) as required. Date of closure : July 20, 2013 Verification result: Company provide revised material balance the new material balance has been inform about quantity of incoming material and FFB processing with daily basis, as recorded on Daily production report with Form No. AG-SMM-FR-P. 11Rev. 01 this record covering production processing for palm oil and palm kernel product. Auditor Conclusions: Closed. SCCS Non-conformance 2013-SCCS-07 of 08: PT Agromitra Madani has not included selected supply chain model in all sales documents. Correction : All sales document format has been revised to include information about selected supply chain model i.e Mass Balance. Corrective Action: To impelement the new format consistently accoridong to requirement. Date of closure : July 20, 2013 Verification result: Company provide revised format for delivery document such as: delivery order; delivery evidence; de-livery note, and weigh bridge ticket. All documents already indicate selected supply chain model with MB stamp. Implementation will be start after company get carried CSPO/SCPK order. Auditor Conclusio ns: Closed SCCS Non-conformance 2013-SCCS-08 of 08: The facility shall provide the training for all staff as required to implement the requirements of the Sup-ply Chain Certification Systems.

Correction :



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Training for SCCS was provide to relevant staff by exernal consultant AFIERFOLG Corrective Action: All relevant training will be provided to improve competency as required. Date of closure : August 20, 2013 Verification result: Company provides training evidence such as lit of participants, photograph and minutes training. Train-ing was conducted on August 20, 2013. Auditor Conclusions: Closed

3.6 Noteworthy Positive Components

Criterion 8.1. (Minor ) Records of follow-up action s

Findings: Company commitment for RSPO compliance still good, even financial condition for recent one year is not good.

3.7 Issues Raised by Stakeholders and Findings Pert aining to Issues Below is a summary of issues raised by stakeholders interviewed on-site

No. Issues Raised Management Response Audit Verification

1.

There is no CSR program for community in year 2012 to 2013

Due to finacial condition all CSR program being postponed and will be reschedule after recover condition.

No CSR program evi-dence for year 2012

2. No training provide for smallholder

Due to finacial condition all train-ing program being postponed and will be reschedule after recover condition.

No training evidence for year 2012

3. Company payment for FFB still toleranced

Company will try the best for payment FFB from smallholder.

Some delayed but it was tolerance by the smll-holder.



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4.0 CERTIFIED ORGANISATION’S ACKNOWLEDGEMENT OF INT ERNAL RESPONSIBILITY

4.1 Date of Next Surveillance Visit

The next surveillance visit is planned for July 2014

4.2 Acknowledgements of Internal Responsibility and Formal Sign-Off by Client

It is acknowledged that the assessment visit was carried out as described in this report and we accept the as-sessment findings and report content. Signed on behalf of Bakrie Sumatra Plantation Unit Jambi

…………………………………………. Efdy Ruzali Manager Representative Date: September 8, 2013

Signed on behalf of PT TUV Rheinland Indonesia …………………………………………. Dian Susanty Soeminta Lead Auditor Date: September 5, 2013



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APPENDICES

Appendix 1: Details of Revised Certificate No applicable

Appendix 2: List of Abbreviations AMDAL Analisis Dampak Lingkungan & Sosial

(Social & Environmental Impacts Assessment) CPO Crude Palm Oil EIA Environmental Impact Assessment ERTs Endangered, Rare & Threatened species ESH Environmental Safety & Health FFB Fresh Fruit Bunches EFB Empty Fruit Bunches HCV High Conservation Value IPM Integrated Pest Management LTA Lost Time Accident MSDS Material Safety Data Sheets NGO Non-Government Organization OSH Occupational Safety & Health PKO Palm Kernel Oil POME Palm Oil Mill Effluent PPE Personal Protective Equipment RKL Rencana Pengelolaan Lingkungan (Environmental Management Plan) RPL Rencana Pemantauan Lingkungan (Environmental Monitoring Plan) SIA Social Impact Assessment SOP Standard Operating Procedure UKL Upaya Pengelolaan Lingkungan (Environmental Management Efforts) UPL Upaya Pengelolaan Lingkungan (Environmental Management Efforts)

Appendix 3: List of Stakeholders Interviewed and Co ntacted

No. Name of Stakeholder

Institution - Address Remark

Stakeholders Interviewed On-Site 1. Kasman Ardi HRD 2. Ahmad Purchasing section 3. Supandi HRD 4. Ade Perdana Officer 5. Hasan S. Lubis Agro Mitra Madani 6. Hartanto ISO section 7. Irwin Syarif Smallholder 8. Ridwan Utility 9. Amir Hasan Agro Mitra Madani 10. M. Padhirx Purchasing 11. Sunadi Head Office Jambi 12. Ahmad Fuad PBSN 13. Triadi Agro Mitra Madani 14. Harsono Kasino 15. Zulnofirman Agro Mitra Madani 16. Najmul Manar HO (Head Office) 17. Jasmin Mill Agro Mitra Madani



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Appendix 4: Observations and Opportunities for Impr ovement

No. Observations / Opportunities for Improvement Criteria 1.

Simulation of emergency and response procedure for plantation according exist-ing SOP should be conducted to demonstrate adequacy of SOP. (5.5)

5.5

2. Water pump not available especially in plantation division office, this is very dif-ficult to find water without water pump during emergency condition.

5.5.

3. Replacement program of mask filter for spraying is not available 4.7

4. Communication about working agreement only by formal method, sometime this is not effective especially for field worker.

6.5

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