Stage 1 Stage2 [ ] ARTHA SEJAHTERA PT SMART Tbk · PT. BUANA ARTHA SEJAHTERA (PT. BAS) 1.3.4 Number of management unit 1 (one) unit POM (Semilar Mill) which receives FFB Supply from

PT. MUTUAGUNG LESTARI

ASSESSMENT REPORT

Rountable on Sustainable Palm Oil Certification

[ ] Stage 1 [√] Stage2 [ ] Surveillance

Plantation Manager/Owner : PT. TAPIAN NADENGGAN and PT. BUANA ARTHA SEJAHTERA – PT SMART Tbk

Mill and Plantation Name : Semilar POM and Semilar Estate; Sei Rindu Estate (PT. Tapian Nadenggan), Mandang Estate; Puri Estate (PT. Buana Artha Sejahtera)

Location : Rungau Raya Village, Danau Siluluk Sub-District, Seruyan District, Central Kalimantan Province, INDONESIA

Certificate Code : MUTU-RSPO/028

Date of certificate issue : 22 July 2013

Expiry date of certificate : 21 July 2018

Assessment Type

Assessment Date PT Mutuagung Lestari

Auditor Checked By Approved By

Stage-1 03-06 Defember

2012

Octo HPN Nainggolan, Marsudi Eko Santoso, Muardi Marwas, Naila Karima, Bukti

Bagja

Taufik Margani Tony Arifiarachman

Stage-2 04-08 February

2013

Oktovianus Rusmin, Ibnu Satria Prabudi,

Marsudi Eko Santoso Bukti Bagja

Taufik Margani Tony Arifiarachman

Mutuagung Lestari • Raya Bogor Km 33,5 Nomor 19 • Cimanggis • Depok 16953• Indonesia

Telephone (+62) (21) 8740202 • Fax (+62) (21) 87740745/6

Email : [email protected] ● www.mutucertification.com

MUTU Certification • Approved by RSPO Secretariat on June 2008

Submitted to RSPO Secretariat: Approved by RSPO Secretariat: Approved by CB:

8 May 2013

15 July 2013

20 July 2013

mailto:[email protected]

http://www.mutucertification.com/


ASSESSMENT REPORT

SPO – 4006a.5 i Prepared by Mutuagung Lestari for Semilar POM - PT. Tapian Nadenggan

TABLE OF CONTENT

Figure

Figure 1. Location Map of PT. Tapian Nadenggan & PT. Buana Artha Sejahtera Figure 2. Location Map of Semilar Palm Oil Mill

2 3

1.0 SCOPE OF CERTIFICATION

1.1 National Interpretation Used 4

1.2 Organization Information 4

1.3 Type of Assessment 4

1.4 Locations of Plantations, Mill and Hectare Statements 4

1.5 Description of Supply Base 5

1.6 Cycles and Planting year 6

1.7 Tonnage Certified Product 6

1.8 Other Certifications 7

1.9 Time Bound Plans for Other Management Units 7

2.0 ASSESSMENT PROCESS

2.1 Certification Body 9

2.2 Lead Auditor and Auditor Team 10

2.3 Assessment Methodology, Progress, and Site Visit 12

2.4 Stakeholder Consultation and List of Stakeholder Contacted 12

2.5 Next visitation 12

3.0 ASSESSMENT RESULT

3.1 Summary of Assessment Report of the RSPO Certification 13

3.2 Summary of Assessment Report of Supply Chain 46

3.3 Checklist Conformity of Certificate and Logo Use 50

3.4 Summary of Time Bound Plan Verification of the RSPO Certification 52

3.5 Identification of Findings, Corrective Action, Observations, Opportunity for Improvement and Noteworthy Positive Components

54

3.6 Summary of Arising Issues from Public, Organization and Auditor Response 59

4.0 CERTIFIED ORGANIZATION’S ACKNOWLEDGEMENT OF INTERNAL RESPONSIBILITY

4.1 Formal Sign-off of Assessment Findings 65

ANNEXES

1 List of Stakeholder Contacted in the RSPO Certification Process 66

2 Audit Plan 67

3 Glossary 69


ASSESSMENT REPORT

SPO – 4006a.5 Page 2 Prepared by Mutuagung Lestari for Semilar POM - PT. Tapian Nadenggan

Figure 1. Location Map of PT Tapian Nadenggan & PT Buana Artha Sejahtera


ASSESSMENT REPORT


Figure 2. Location Map of Semilar Palm Oil Mill


ASSESSMENT REPORT


1.0

SCOPE OF CERTIFICATION

1.1 National Interpretation Used National Interpretation, RSPO Principles and Criteria for Sustainable Palm Oil Production, Republic of Indonesia - RSPO INA-NIWG, May 2008 and Supply Chain Requirement for CPO Mill.

1.2 Organization Information

1.2.1 Company Name PT SMART Tbk

1.2.2 Contact person Ismu Zulfikar

1.2.3 Business address

Head Office: Plaza BII Tower 2, 30th Floor JL. MH Thamrin No 51 Kav 22 Jakarta 10350 Indonesia Site: Rungau Raya Village, Danau Siluluk Sub-district, Seruyan District.

1.2.4 Telephone (+62-21) 318 1388

1.2.5 Fax (+62-21) 318 1389

1.2.6 E-mail [email protected]

1.2.7 Website www.smart-tbk.com

1.2.8 Type of enterprise Private

1.2.9 Application information completed by duly authorized representative

Ismu Zulfikar (Head of Environmental Departement)

1.2.10 RSPO member registration 1-0019-05-000-00, 30 January 2005

1.3 Type of Assessment

1.3.1 Certification scope Palm Oil Mill and Estate

1.3.2 Type certificate Single

1.3.3 Names of company covered in this certificate PT. TAPIAN NADENGGAN (PT. TN) PT. BUANA ARTHA SEJAHTERA (PT. BAS)

1.3.4 Number of management unit 1 (one) unit POM (Semilar Mill) which receives FFB Supply from 4 (four) Estates i.e Semilar Estate and Sei Rindu Estate (PT. Tapian Nadenggan); Mandang Estate and Puri Estate (PT. Buana Artha Sejahtera)

1.4 Location of Estates, Mill and Hectarage

1.4.1 Location of Estate

Name of Estate (s) Location

GPS reference

Latitude Longitude

Semilar Estate

Rungau Raya Village, Danau Siluluk Sub-district, Seruyan District.

20 15‟ 06.21” N 1120 20‟ 58.83” E

Sei Rindu Estate

Tangar Village, Mentaya Sub-district, Kotawaringin Timur District, Central Kalimantan Province

20 15‟ 12.86” N 1120 24‟ 28.98” E


http://www.smart-tbk.com/


ASSESSMENT REPORT


Name of Estate (s) Location

GPS reference

Latitude Latitude

Mandang Estate

Rungau Raya Village, Danau Siluluk Sub-district, Seruyan District.

20 16‟ 28.22” N 1120 20‟ 16.69” E

Puri Estate

Birumaju Village, Telawang Sub-district, Kotawaringin Timur District, Central Kalimantan Province

20 18‟ 22.06” N 1120 25‟ 13.39” E

1.4.2 Location of Mill

Name of Mill Location

GPS reference

Latitude Longitude

Semilar Mill Rungau Raya Village, Danau Siluluk Sub-district, Seruyan District.

20 14‟ 53,73” N 1120 20‟ 25,55” E

1.4.3 Map Figure 1, 2, 3 dan 4

1.4.4 State Indonesia

1.4.5 Region Southeast Asian

1.4.6 Village / Sub-district / District / Province Rungau Raya Village, Danau Siluluk Sub-district, Seruyan District.

1.4.7.1 Private

1.4.7.2 State 17,088.00 Ha

1.4.7.3 Community

1.4.8 Description of Land Use

Total areal 17,088 Ha

Mature area 15,557.67 Ha

Immature area 37.94 Ha

Mill / Housing 193.77 Ha

Infrastucture (nursery, roads, etc) 728.54 Ha

Occupation 158.73 Ha

High Conservation Value 146.74 Ha

1.5 Description of Supply Base

1.5.1 Estate (s)

Name of Estate (s)

Total Area (Ha)

Planted Area (Ha)

FFB (tonnes/year)

Yield (tonnes/ha/year)

Supplied to Mill

FFB (tonnes/year)

%

Semilar Estate 4,288.63 4,008.83 136,422.99 34.03 136,422.99 100

Sei Rindu Estate 3,990.60 3,740.18 125,663.95 33.60 125,663.95 100

Mandang Estate 5,170.35 4,789.99 153,199.99 31.98 74,437.94 48.59

Puri Estate 3,638.42 3,321.22 103,378.39 31.13 73,765.13 71.35

TOTAL 17,088 15,860.22 5186,65.326 32.70 410,290.01 -

Source: Estate Production Data on Februari 2012 – January 2013


ASSESSMENT REPORT


1.5.2 Smallholder Scheme and Another Source

Scheme Member(s) Location Total Area

(Ha)

FFB Production

(tonnes/year)

Supplied to Mill

FFB Production

(tonnes/year) %

KT 2 (PT. Bina Sawit Abadi Pratama)

- Danau Seluluk Sub-district

20,180 5,475.40 5,475.40 -

KT4 (PT. Mitra Karya Agroindo)

- Danau Seluluk Sub-district

25,000 93,349.51 93,349.51 -

TOTAL - - 45,180 98,824.91 98,824.91 -

Sumber: FFB Received Data of SemilarMill on February 2012 – January 2013

1.5.3 Description of Mill

Name of

Mill Capacity

(tonnes/hour)

FFB Processed

(tonnes/year)

CPO PK PKO

Out put (ton)

Extraction (%)

Out put (ton)

Extraction (%)

Out put (ton)

Extraction (%)

Semilar Mill 80 509,177 128,941 25.32 23,972 4.71 - -

Sumber: FFB Process Data of SemilarMill on February 2012 – January 2013

1.5.4 Type of Product FFB/CPO/PK

1.6 Planting Year and Cycles

1.6.1 Age profile of planted palms

Planting Year

Hectarage (Ha) Total

Semilar Sei Rindu Mandang Puri

1998 - - 16.40 - 16.40

2000 - - 176.35 323.19 499.54

2001 - - 157.95 - 157.95

2004 - - 106.66 - 106.66

2005 2,998.59 - 480.77 1,202.35 4,681.71

2006 1.010.24 3,450.02 2,945.06 655.60 8,060.92

2007 - 290.16 822.64 733.04 1,845.84

2008 - - 46.22 407.04 453.26

2011 - - 37.94 - 37.94

TOTAL 4,008.83 3,740.18 4,789.99 3,321.22 15,860.22

1.6.2 Area restocked by replanting after 2005 10,397.96 Ha

1.6.3 Cycles 25 Year(s)

1.7 Tonnage Certified Product

1.7.1 Annual Actual Claims of Certified Product *)

FFB Production - Tonnes/year


ASSESSMENT REPORT


CPO Production - Tonnes/year

Palm Kernel (PK) Production - Tonnes/year

Palm Kernel Oil (PKO) Production - Tonnes/year

1.7.2 FFB Certified Claim Production

Name of Estate (s)

Total Area (Ha)

Planted Area (Ha)

FFB Production (tonnes/year)

Yield (tonnes/year)

Semilar Estate 4,288.63 4,008.83 121,976.37 30.43

Sei Rindu Estate 3,990.60 3,740.18 111,018.56 29.68

Mandang Estate 5,170.35 4,789.99 131,313.84 27.41

Puri Estate 3,638.42 3,321.22 90,253.17 27.17

TOTAL 17,088.00 15,860.22 454,561.94 28,66

Source: Process Data of Production Projection on January 2013 – December 2013

1.7.3 Certified Production of Palm Oil Product Claim

Name of

Mill

Capacity (tonnes/

hour)

FFB Processed (tonnes/

year)

CPO Palm Kernel PKO

Out put (ton)

Extraction (%)

Out put (ton)

Extraction (%)

Out put (ton)

Extraction (%)

Semilar Mill

80 454,561.94 118,186.

10 26 22,728.10 5 - -

Source: Process Data of Production Projection on January 2013 – December 2013

1.8 Other Certifications

1.8.1 ISO 9001:2008/ISO 14001: 2004 -

1.8.2 OHSAS 18001:2007 -

1.8.3 HACCP -

1.8.4 Other (s) - ISCC (International Sustainablity and Carbon Certification) No. Reg: ISCC-Reg-1726 for Semilar Mill since November, 28, 2012 by GUTCert. Validated until Nopember 27, 2013

1.9 Time Bound Plan for Other Management Units

SMART Tbk has committed to making the time bound plan for the overall of another unit that is under management in applying the standard of the P & C or obtain RSPO certification and audit team has been considering this plan in accordance with the RSPO Certification System for Partial Certification. The development and follow-up of this plan will be verified and reported on an annual routine visit.

Mill Company

Mill Estate (FFB Supplier) Address Time Bound

Plan Status per Jan

2013

1 Padang Halaban Mill

Padang Halaban Estate; Pernantian Estate; Adipati Estate; Kanopan Ulu Estate

North Sumatera 2011 Certified

2 Batu Ampar Mill Batu Ampar Estate; Batu Mulia Estate; Sungai Panci Estate; Sungai Panci KKPA

South Kalimantan 2012 Certified


ASSESSMENT REPORT


3 Tanah Laut Mill Tanah Laut Estate; Kintapura Estate

South Kalimantan 2012 Certified

4 Langga Payung Mill

Langga Payung Estate; Paya Baung Estate; Normak Estate

North Sumatera 2012 Certified

5 Hanau Mill Hanau Estate; Tasik Mas Estate; Tanjung Paring Estate; Langadang Estate; Medang Sari Estate

Central Kalimantan

2012 Certified

6 Leidong West Mill

Leidong West; Utara Estate; Leidong West Selatan Estate; Bukit Intan Estate; Bukit Mas Estate

Bangka 2013 Internal Audit Completed

7 Semilar Mill Semilar Estate; Sei Rindu Estate; Mandang Estate Puri Estate

Central Kalimantan

2012 Audited

8 Jak Luay Mill Pantun Mas Estate; Pantun Mas Kkpa; Jak Luay Estate; Jak Luay KKPA; Long Buluh Estate; Bukit Subur Estate; Bukit Subur KKPA.

East Kalimantan 2014 Preparation

9 Gunung Kombeng Mill / Muara Wahau Mill

Gunung Kombeng Estate ; Gunung Kombeng KKPA; Muara Wahau Estate; Rantau Panjang Estate; Rantau Panjang KKPA.

East Kalimantan 2013 Internal Audit Completed

10 Jelatang Mill Batang Merangin Estate Jambi 2013

Internal Audit Completed

Kubang Ujo Plasma, Pamenang Plasma

Jambi 2014 Gap Analysis Completed

11 Pelakar Mill Pelakar Estate Jambi 2014


Tiga Serumpun KKPA; Bukit Bungkul KKPA


12 Langling Mill Bangko Inti Estate Jambi 2013


Bangko Plasma Jambi 2014

Gap Analysis Completed

13 Sungai Bengkal Mill

Sungai Bengkal Estate; Batang Gading Estate; Kilis Estate

Jambi 2014 Internal Audit Completed

Sungai Bengkal KKPA; Batang Gading KKPA; Kilis KKPA


14 Bukit Kapur Mill Sungai Cantung Estate; Bukit Kapur Estate South Kalimantan 2015 Preparation


ASSESSMENT REPORT


2.0

ASSESSMENT PROCESS

2.1

Certification Body

PT Mutuagung Lestari Jl. Raya Bogor Km 33,5 No. 19, Cimanggis – Depok 16953 Telp. +62-21-8740202, Fax +62-21-87740745/46 Website: www.mutucertification.com

Email : [email protected] Approved by RSPO Secretariat on June 2008

2.2

Lead Auditor and Tim Auditor

2.2.1 Auditor Team

Stage-1 1. Octo Nainggolan (Witnesses). Indonesian citizen, Bachelor of Agriculture, majoring of Social Economics of Agriculture (Agribusiness). He has a working experience since 2004 oil palm Plantation Company in Indonesia. Trainings attended namely: Training of Conservation of Natural and Biological Resources in supporting HCV, Basic Plantation Management Program, Plantation Integrated Pest Management training, Followed the Management System Certification (ISO 9001-2008/SNI 19011-9001:2008), Environment Management System (ISO 14001:2004) , RSPO Lead Auditors Training Course, Indonesian Sustainable Palm Oil (ISPO) Lead Auditor training course and supply chain certification system training. Currently, he worked at Professional Certification Body. In the assessment activity, he assessed on legal aspect, best practices, environment aspect, social aspect, workers welfare, FFB Processing and supply chain requirement.

2. Marsudi Eko Santoso (Auditor). Bachelor of Science in Agriculture, majoring in Agro technology. Followed the Management System Certification (ISO 9001-2008), Awareness HACCP certification, training of RSPO auditor and training of RSPO Lead Auditor training, ISPO Lead auditor training and distribution quality management process - APMEA. He had involved several time in RSPO certification assessment activities as an auditor. Currently he works for Independent Certification Body. In this activy, he has assessed for best practice, labour welfare and OHS.

3. Bukti Bagja (Auditor). Master of Science in the field of Environmental Sciences, University of Indonesia. Training he has followed are: awarness of RSPO certification system. He has followed several activities GAP Analysis of the RSPO Principles and Criteria implementation in several oil palm plantations in Indonesia as assessor. Besides that he is also involved in several assessments HCV / HCV as an assessor with the specifications in the field of GIS (mapping). He has expertise in mapping such as ArcGIS, MapInfo, Global Mapper, ER Mapper, Erdas Imagine. In this activy, he has assessed for environment aspect and identification area.

4. Muardi Marwas (Auditor). Bachelor of Agriculture, Bogor Agricultural University. Active in workshops and seminars oil palm sustainable management and greenhouse gases. He has assessed the RSPO certification in palm oil companies in Indonesia. He followed training such as Indonesian Sustainable Palm Oil lead auditor, RSPO Lead auditor, ISO 9001 and identification of High Conservation Value. Currently, he works as an audior in independent certification agency. In this activy, he has assessed for aspects of agronomy and employment

5. Naila Karima (Trainee Auditor). Bachelor of Public Health, Department of Occupational Safety and Health. Faculty of Public Health, University of Indonesia she attended training of understanding the RSPO certification system and Lead Auditor Training of ISPO. Besides certified Integrated Management System (Health and Safety Management System OHSAS 18001:2007 Occupational, Environmental ISO 14001:2004, ISO 9001:2008 Quality). She is currently working on an independent certification body. In this activy, he has assessed for OHS and labour welfare.

http://www.mutucertification.com/



ASSESSMENT REPORT


Stage-2 1. Oktovianus Rusmin (Lead Auditor). Bachelor‟s Degree in Social & Political Sciences Department of Anthropology. Specialists in the field of Social and Cultural (Social Impact & Conflict Resolution) and HCVF. Followed the Forest Management Auditor Training (FSC Standard), ISO 14001 Environmental Management System Training & SVLK (wood legality) auditors, Indonesian Sustainable Palm Oil (ISPO) Auditor and Management System Certification (ISO 9001-2008/SNI 19-9001:2008) Lead Assessor. He was several times involved in the assessment of Sustainable Forest Management Certification (Standard LEI). Had worked at the Center for the study of Anthropology, University of Indonesia; and experts to the field of Social Tropical Forest Trust (TFT) Indonesia. He was numerously involved the Social Impact Study, Identification HCV in Oil Palm Plantations and natural forest concessions and has conducted several audit for sustainable palm oil certification as Lead Auditor Witnessed. In this activy, he has assessed for legality aspect and social aspect.

2. Ibnu Satria Prabudi (Auditor). Bachelor of Agriculture Majoring in Agro-technology, Agriculture Faculty of Instiper Yogyakarta. Currently he has been working with an independent certification agency as an auditor. Training he has followed are: Lead Auditor RSPO, Auditor ISPO, Lead Auditor ISO 9001;2008, Awarness HACCP certification, Awarness SQMS Mc Donald, In House Training Green House Gass, and he has engaged on the field test of ISPO standard and then has conducted several audit for sustainable palm oil certification as an Auditor. In this activy, he has assessed for best practice and environment aspect.

3. Bukti Bagja (Trainee Auditor). Master of Science in the field of Environmental Sciences, University of Indonesia. Training he has followed are: awarness of RSPO certification system. He has followed several activities GAP Analysis of the RSPO Principles and Criteria implementation in several oil palm plantations in Indonesia as assessor. Besides that he is also involved in several assessments HCV / HCV as an assessor with the specifications in the field of GIS (mapping). He has expertise in mapping such as ArcGIS, MapInfo, Global Mapper, ER Mapper, Erdas Imagine. In this activy, he has assessed for environment aspect and identification area.

4. Marsudi Eko Santoso (Auditor). Bachelor of Science in Agriculture, majoring in Agro technology. Followed the Management System Certification (ISO 9001-2008), Awareness HACCP certification, training of RSPO auditor and training of RSPO Lead Auditor training, ISPO Lead auditor training and distribution quality management process - APMEA. He had involved several time in RSPO certification assessment activities as an auditor. Currently he works for Independent Certification Body. In this activy, he has assessed for best practice, labour welfare and OHS.

Curriculum Vitae (CV) of the auditor team available at Mutuagung Lestari‟s office

2.3

Assessment Methodology, Progress, and Site Visit

2.3.1

Estimate of person days to implement assessment

Stage-1 Number of auditors : 4 persons Number of days for Stage-01 at site : 4 days Number of working days for Stage -01 at site : 16 Main days

Stage-2 Number of auditors : 4 persons Number of days for Stage-02 at site : 5 days Number of working days for Stage -02 at site : 20 Main days

2.3.3

Detail of Assessment Process

Stage-2 The assessment was conducted by measuring the sufficiency of implementation with the consistency done by the PT Tapian Nadenggan & PT Buana Artha Sejahtera to the requirements of National Interpretation of the Republic of Indonesia from RSPO Principles and Criteria for Sustainable Palm Oil Production (RSPO INA-NIWG, May 2008 and Scheme Smallholders October 2009) and Supply Chain Requirement for CPO Mill The assessment was conducted in three methods: (1) document review, aiming to observe the sufficiency of types or substances from required documents; (2) interview, aiming to obtain more detailed information and cross check the


ASSESSMENT REPORT


information; and (3) field observation, aiming to observe directly the sufficiency of implementation on site. Some opportunities for improvement of the results ST-2 delivered by the auditor MAL to the management unit and the results are the subject will be verified at the next assessment phase (S-1). Improvement of findings from main assesment findings were observed by auditors at this ST-2 assessment. All information obtained was recorded in Check List of PT Mutuagung Lestari (MUTU) and part of ST-2. The assessment program please find Appendix 2

2.3.3

Location of Assessment

Stage-2 The sampling locations which selected by Audit Team based on : 1. Number of sites visited, which is determined by the formula 0.8 √ y. 2. The sites selected represent each of operational working area. 3. The consideration of issues arising from the results of public consultations and document review activity that is

fundamental and crucial.

The sites visited are completely presented as follows:

Location 1 – Block G-47 and G-48 Semilar Estate observation of implementation SOP harvesting, occupational health & safety, worker‟s wages and facilities for employees

Location 2 - Block H-48 Semilar Estate. observation of implementation SOP spraying, occupational health & safety, worker‟s wages and facilities for employees

Location 3 – Block G-H (Main Road). Observation of beneficial plant (Turnera Subulata) along main road block G-H

Location 4 – Block H-47.Observation of estates waste (anorganic) management

Location 5 – Emplacement 3 Semilar Estate Observation of estates waste (anorganic and organic) management, eligibility and sanitary housing employees

Location 6. Warehouses semilar estates (fertilizer, oil, fuel and chemist) : Observation of implementation occupational health & safety , hazardous waste management and facilities of emergency countermeasures

Location 7 central clinic : Observation and interview with company‟s doctor related with medical waste, medical check up, desases monitoring and supply of medicines

Location 8 Public facilities :observation of public facilities and infrastructure for employees such as place of worship, schools, Day Care Center and the Smart Home as an initiation of SIKIB (Solidarity United Indonesia Cabinet‟s Wifes).

Location 9 – Block K-57 Semilar Estate observation of EFB aplication

Location 10 - Block J43 Mandang Estate. Observation and interviews with sprayers who transfer to beneficial plants care. personal protective equipment, riparian area that cannot spray (Block I 40, I43, J45 and H43), training of fertilizing, training of safety, madical check up, first aid emergency boxs, handling of poisoning emergencies, wages, reproductive rights, sexual harassment protection,gender committee and insurance.

Location 11 - Block I35 Mandang Estate observation and interview with foreman and harvesters about crop technic, personal protective equipment, remuneration the premium harvest, penalties for raw and left fruit, harvest quality rating by the foreman, employee grievance, occupational risk and handling of accidents.

Location 12. Spray equipment warehouse. Observations on the presence of wash sprayer, spray equipment storage, a place to wash up after sprayer, handling of waste to re-used

Location 13-employee Hall Mandang Estate. Observation of employees gathered and meeting and to discuss common interests.

Location 14 - Baby Care Centers Mandang Estate. Observation and interviews with nany about baby care facilities for, the presence of baby more than 2 years old, first aid emergency and the training and appropriate wages.

Location 15 - Emplacement Mandang Estate. Observation and interviews with workers wives about housing facilities, handling emergencies, domestic waste management, water facilities such as boreholes, complaint handling if there is damage in housing and facilities for worship (mosque).


ASSESSMENT REPORT


Location 16 - Clinic Mandang Estate. Observation and interviews with paramedics about health facilities for workers, periodic inspection and management of clinical waste.

Location 17 - Block J34 Mandang Estate : Observation of Tunera and Antigonon

Location 18 - Block J35 Mandang Estate : Observation of sign board about prohibition employ children under 18 years.

Location 19 - Block K37 Mandang Estate. Observation and interviews with the assistant about Landfills end.

Location 20 - Central Warehouse Mandang Estate. Observation and interviews with chief about medical check up, hazardous waste warehouse, MSDS, and stock of PERSONAL PROTECTIVE EQUIPMENT

Location 21 - Firefighter Secretariat Mandang Estate. Observation and interviews with leaders of the firemen about training, fire extinguishers and equipment.

Location 22 – boundaries pole HGU 22, 26, 32, Puri Estate: checks on markers and the condition is well-maintained.

Location 23 Biru Manu Villages : interviews with the former head of the village, community leaders and villagers about the impact of palm oil plantations, the implementation of CSR and other important issues (conflict or potential conflict).

Location 24 – boundaries pole HGU 16,19,22 Sei Rindu Estate: checks on markers and the condition is well-maintained.

Location 25 – Pantap Village : interviews with the village secretary, community leaders and villagers about the impact of palm oil plantations, the implementation of CSR and other important issues (conflict or potential conflict).

2.4

Stakeholder Consultation and List of Stakeholder Contacted

2.4.1 Summary of Public Consultation Process

(1) Consultation of stakeholders for PT Tapian Nadenggan & PT Buana Artha Sejahtera was held by public consultation meeting with internal stakeholders by interviews and local stakeholders conducted by visits to villages and interviews with local peoples. Numbers of input from stakeholders were clarified by PT Tapian Nadenggan & PT Buana Artha Sejahtera

2.4.2 The contacted list of stakeholders

Please find appendix 3

2.5

Next visit

The next visit (Surveillance 1) will be determined one (1) year later after Stage-02 conducted.


ASSESSMENT REPORT


3.0. ASSESSMENT RESULTS

3.1. Summary of the RSPO Certification MUTUAGUNG LESTARI has conducted an assessment of Semilar POM - PT. Tapian Nadenggan, SMART TBK Group operation consisting of one (1) mill and four (4) oil palm estates. During the assessment, there were one (1) nonconformity were assigned against Minor Compliance Indicators and three (3) opportunity(s) for improvement were identified. Further explanation of the non-conformities raised and corrective actions taken by the company are provided in section 3.5. The company has already prepared and implemented the corrective action(s) that had been reviewed and accepted by Auditor(s) in form of documentation evidence(s) e.g. document record and photographic. Those corrective action(s) taken that consist of one (1) Minor non-conformity(s) had been closed out shall be verified during next assessment. MUTUAGUNG LESTARI found that Semilar POM - PT. Tapian Nadenggan, SMART TBK Group complied with the requirements of RSPO Principles & Criteria and National Interpretation, RSPO Principles and Criteria (P&C) for Sustainable Palm Oil Production, Republic of Indonesia - RSPO INA-NIWG, May 2008 and/or Scheme Smallholders, October 2009*) . Therefore MUTUAGUNG LESTARI Recommends RSPO Certification of compliance is Issued

Ref Std. VERIFICATION RESULT of MUTU-Certification

PRINCIPLE #1 COMMITMENT TO TRANSPARENCY

1.1 Plantation and Palm Oil Factory have to give adequate information for stakeholders in appropriate language and forms, to ensure the effective participation of stakeholders in decision-making.

There is Record of Information Request available in the Record Book of Information Request and Response. The information request is recorded in the Incoming Mail Matrix, including number of letter, date, sender and subject. For example:

1. In Mandang Estate, incoming mail dated 24 November 2012 No. 140/IV/RR/XI/2012/Pem from the village representatives officer of Sungai Raya on the request of personal data of the members of voting booth/Linmas and Data of the Election of Head of Seruyan District.

2. In Semilar Estate, incoming mail dated 2 October 2012 from Manpower and Transmigration Service No. 560.566/204/WAS-X/2012 on the cross-checking notification about occupational accidents occurred in the company, the occupational report later than 1 month will not be processed, all workers including daily freelance workers must be involved in the program of Jamsostek, and that there will be special examination from Manpower Service and police.

3. In Semilar Mill, there is an information request from the Sector Police of Hanau No. B/73/XI/2012 dated 30 November 2011 on the request of workers‟ data and had been responded by consulting it to the Independent Workers Union (SPM) of Semilar Mill on 1 December 2012. The SPM agreed to provide the data. The current process towards the process of preparation of consultation data from PC and the data is planned to be delivered to the Sector Police of Hanau on 30 December 2012.

Based on the SOP of Communication and Consultation Document No. SOP/NP/SMART/XIV/MCAR003 at point 6.3.1.d. The Estate Manager delivers the letter to the relevant Department in 1 (one) week, consults it to the RC for 3 (three) weeks and send the result to the requester. Records are stored based on the document retention procedures in the SOP No. SOP/SPO/SMART/LH-02 point 1 which stated that retention time of documents and records at the secretariate of SPO is ± 5 (five) years.

Status: Full Compliance


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

There is an SOP of Information request and Response No. SOP/SPO/SMART/LH-01, valid on 1 July 2010. It describes the information that can be accessed by appropriate parties listed in the List of Information and Stakeholders. The accessible in formation and relevant stakeholders are among others:

1. The number of employees and principle wage register (District and Provincial Manpower Service). 2. Machine Unit Licensing (District and Provincial Manpower Service). 3. List of Employees and Taxpayer Registration Number and information of Land and Building Tax (District and Provincial Tax

Service). 4. Regional Tax Payment (District and Provincial Government). 5. Certificate of Company Establishment (Worker Union). 6. Study of EIA, Environmental Management Plan/Environmental Monitoring Plan, and Land Application License (District and

Provincial Environment Bodies, Ministry of Environment). 7. Certificate of establishment and amendment (District and Provincial Plantation Agency). 8. Proof of land ownership/Certificate of Land Use Title (District and Provincial Plantation Agency, National Land Agency). 9. Report of HCV Assessment (Social Non-Governmental Organizations). 10. Documentation of social activities (Head of Village and Sub-district, District and Provincial Government, Social NGOs).

For other information outside the List of Information above, it is necessary to ask for consideration and approval from Top Management as well as consultation with relevant department. Documents confidentiality also present in the SOP of Document Control and Retention Time Point H.


PRINCIPLE #2 COMPLIANCE WITH APPLICABLE LAWS AND REGULATIONS

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

There is a document of Regulations and Other Requirements Procedure No. SOP/SPO/SMART/LH-03 point 6 that describes the mechanism for the collection and evaluation of regulations by the special staffs to update regulations (SK No. 003/VP-PSM/10/12). The updating is made every 6 months. There is a Document of evaluation list of regulatory compliance. For example, in the TRWE estate the evaluation of regulatory compliance is carried out on 13 November 2012. Evidence of regulatory compliance, such as :

1. Company has appointed OHS Expert as the secretary of The Guiding Committee of Occupational Health and Safety and conducted reporting of The Guiding Committee of Occupational Health and Safety every 3 (month) due to the Regulation of Labour Ministry No. 4 year 1987.

2. Mill Boiler Operator has obtained boiler operator license refers to Regulation of Labour Ministry No. 1 year 1988. - OHS License for Boiler Operator Class I on behalf of Setiyo Budi No. 11.492-OPK3-PUBT-B.I/III/2011 valid through 31

March 2013. - OHS License of Boiler Operator Class I on behalf of Tomi Saputro No. 11.479-OPK3-PUBT-B.I/III/2011 valid through 31

March 2011. 3. conveying and forklift operators has obtained operator license according to Regulation of Labour Ministry No. 9 year 2010.

- Semilar Estate: OHS License for Conveying & Forklift Operator (Wheel Loader) on behalf of Kristanto No. 10.5787/OPF/KK/IX/2010 valid through 28 September 2015, and on behalf of Deny Wahyu Lugo Irianto 10.5788/OPF/KK/IX/2010 valid through 28 September 2015.

- Mandang Estate: OHS License for Conveying & Forklift Operator (Grader) on behalf of Sapari No. 12.576-OPK3-PAA/I/2012 valid through 27 January 2017, on behalf of Sudiyono (Tractor) No. 12.576-OPK3-PAA/I/2012 valid through


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27 January 2017, on behalf of Asien CB (Backhoe Loader) No. 12.577-OPK3-PAA/I/2012 valid through 27 January 2017, on behalf of Anwar Kurniawan (Bulldozer) No. 12.578-OPK3-PAA/I/2012 valid through 27 January 2017.

4. Welders have obtained license of welder competence according to Regulation of Labour Ministry No. 2 year 1982. - Mandang Estate: Competence Certificate of BNSP No. 28126 7212 0011679 2010 on behalf of Nurozi (Workshop

Mechanic) (Reg. No. LOG 004 011679 2010) in the workfield of Welding Manufacture set on 28 December 2010 with a validity period of 3 (three) years.

- Semilar Mill: Competence Certificate of BNSP No. 28126 7212 0011689 2010 on behalf of Alimat Setiono (Reg. No. LOG 004 011689 2010) in the workfield of Welding Manufacture set on 28 December 2010 with a validity period of 3 (three) years.

5. Electrician have obtained competence certificate of Electricity OHS that refers to Decree of Directorate General of Guidance and Supervision No. 311 year 2002. - OHS License for Electrician Reg. No. 3355/TK3-LIST/II/2012 – P0 on behalf of Eka Ardian Setianto (water engine and

power panel operator) valid through 16 February 2015. 6. Company already has document of Land Use Title in accordance with Statute No. 5 year 1990. 7. Company submitted Report of Plantation Business Development. For example, the company has submitted report of

plantation business development for the period of 3rd Quarter (September 2012), accepted by relevant institution on 10 October 2012, according to Statute No. 18 year 2004 article 17 and Regulation of Labour Ministry No. 26 year 2007.

8. Company already has Plantation Business Permit that refers to Regulation of Labour Ministry No. 26 year 2007. 9. Plants Protection is carried out by implementing Integrated Pest Management, which refers to Statute No. 12 year 1992. 10. Company has equipped Hazardous Waste Warehouse with Hazardous Waste Symbols according to Decree of Environment

Impact Control Agency No. 5 year 1995. 11. Company already has permit for Hazardous Waste Temporary Warehouse in accordance to Government regulation No. 18

year 1999. 12. The warehouse is designed and made roofed in accordance with Decree of the Head of Environment Impact Control Agency

No. 255/BAPEDAL/08/1996. 13. Company does not employ children under the age of 18 in accordance with Statute No. 13 year 2003.

There had been several regulations updated and evaluated, for example: 1. Seruyan District: Since 26 November 2012 the Governor has enacted Regulation No. 27 Year 2012 on District Minimum Wage

and District Sectoral Minimum Wage 2013 for the sectors of Plantation and Industrial Plantation Forest of Seruyan District in the amount of IDR 1,697,892. The regulation applies for SMLE, SMLM and MNAE with the lowest salary for Monthly SKU Type G1 is IDR 1,729,600. Implementation of Regulation Amendment: There is Decree of Wage Amendment from the Director available No. 021/18/CEO6/PSM6/12/2012 dated 1 January 2013 that describes wages for Fixed Daily SKU Workers in the amount of IDR 1,697,900/month; for Permanent Daily SKU Workers with tenure of more than 1 (one) year in the amount of IDR 1,698,900/month and wages for Freelance Daily Workers (BHL) is IDR 67,950/day with reference of 25 working days (6-workday in a week). Provision of Wage for Freelance Daily Workers is based on the List of BHL Payroll. For example, provision of wage in January 2013 on behalf of Jayus in the month of January 2013 for 12 (twelve) working days in the period of 26 December 2012 – 10 January 2013, the wage earned is IDR 778,000 (4 working days is considered with Wage of 2012 and 8 working days is considered with Wage of 2013), additional premium wage in the amount of IDR 74,800 and 12 working days with the payroll period of 11 January 2013 – 25 January 2013 so the total salary earned is IDR 2,079,400. Provision of wage based on the List of Great Salary, for example on behalf of Wiyanti on 30 January 2013 with the basic wage in the amount of IDR 1,697,900.

2. Kotawaringin Timur District: Since 3 December 2012 The Governor has enacted Regulation No. 28 Year 2012 on District Minimum Wage and Sectoral Minimum Wage of Kotawaringin Timur District 2013 for the sector of plantation and agricultural industry in the amount of IDR 1,688,960. The regulation applies for SRDE and PURE with the lowest salary of Monthly SKU Type I in the amount of IDR 1,719,900. Implementation of Regulation Amendment: There is Decree of Wage Amendment from the Director available No. 024/21/CEO6/PSM6/12/2012 dated 1 January 2013 that describes wages for Permanent Daily SKU Workers in the amount of IDR 1,689,000/month; for Permanent Daily SKU Workers with tenure of more than 1 (one) year in the amount of IDR 1,690,000/month


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and wages for Freelance Daily Workers (BHL) is IDR 67,600/day with reference of 25 working days (6-workday in a week). It is in accordance with Regulation of Labour Ministry No. 1 year 1999. For example, provision of wage in January 2013 on behalf of Kowil on 12 January 2013 for 9 (nine) working days in the period of 26 December 2012 – 10 January 2013, the wage earned is IDR 466,000 (4 working days is considered with Wage of 2012 and 8 working days is considered with Wage of 2013), additional premium wage in the amount of IDR 299,360 and harvest premium in the amount of IDR 144,150 and 10 working days with the payroll period of 11 January 2013 – 25 January 2013, the salary given is IDR 676,000 and wage premium (IDR 46,750) plus additional works premium (IDR 422,140) so the total salary earned is IDR 2,112,650. Provision of wage based on the List of Great Salary, for example on behalf of Ahmad Jaluli on 25 January 2013 with the basic wage in the amount of IDR 1,689,000 and payment of ASTEK (Labour Assurance) in the amount of IDR 110,461.

3. Government Regulation No. 50 year 2012 on the Implementation of Occupational Health and Safety Management System (OHSAS) that includes implementation of OHSAS in the mill, OHSAS policy setting, OHSAS policy dissemination, hazard identification and control setting, compliance of OHS facilities and infrastructures, OHS license compliance, OHS performance monitoring and evaluation by The Guiding Committee of OHS. There is a report available of OHSAS audit for the period of 2012 in Tapian Nadenggan (No. 01/PT.TN-KT3/INTA-SMK3/X/2012 with 95.32% satisfactory rate for 166 category of advanced implementation). Date of audit is 1-4 October 2012 and in BAS (No. 01/PT.BAS-KT3/INTA-SMK3/X/2012 with 94.74% satisfactory rate for 166 category of advanced implementation) date of audit 8-10 October 2012. The assessment was performed by Mr. Denni Herlambang (auditor certificate of OHSAS No. 355/A-SMK3/XI/2012).

4. Government Regulation No. 27 year 2012 on Environmental Permit, regulatory compliance with the availability of EIA document. There is Document of EIA year 2006 available which was approved on 18 January 2006.


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

Company already has documents of land use/land tenure, such as: 1. Location permit from the Head of National Land Agency of Kotawaringin Timur District No. 1084.460.42 dated 10 October 1995

covering 10,000 hectares to PT. Binasawit Abadi Pratama (BAP) which is located in Danau Sembuluh Sub-district and Mentaya Ulu Sub-district of Kotawaringin Timur District. The location permit was equipped with a location map and was valid for 12 (twelve) months i.e. up to 10 October 1996. It was on behalf of PT. BAP (before the name was changed into PT. TN) and got abandoned/had not been extended for almost 6 (six) years since the expiration of the location permit in 1996.

2. In 2003, PT. BAP which in 2000 had been a part of Sinarmas Group renewed the location permit through two decrees as follow: a. Decree of Head of Kotawaringin Timur District No. 08.460.42 dated 28 April 2003 on Amendment and Renewal of Location

Permit for the Purposes of Oil Palm Plantation Development in the name of PT. Binasawit Abadi Pratama in Kota Besi Sub-district of Kotawaringin Timur District covering 6,837 hectares.

b. Decree of Head of Seruyan District No. 13 year 2003 on Amendment and Renewal of Location Permit for the Purposes of Oil Palm Plantation Development in the name of PT. Binasawit Abadi Pratama in Seruyan Tengah Sub-district and Danau Sembuluh Sub-district of Seruyan District covering 2,463 hectares.

Since in 2002, The location permit divided into two, there was a district expansion from Kotawaringin Timur District into Kotawaringin Timur District and Seruyan District that in 2003 was followed by a number of sub-district expansions therein.

3. In 2003, there had been a transfer (transition) of location permit from PT. BAP to be the name of PT. Mitratama Abadi makmur (MAM) through two decrees as follow: a. Decree of Head of Kotawaringin Timur District No. 700.460.42 dated 30 September on Transition of Location Permit for the

Purposes of Oil Palm Plantation Development on behalf of PT. Binasawit Abadi Pratama to PT. Mitratama Abadi Makmur in Kota Besi Sub-district of Kotawaringin Timur District covering 6,837 hectares and valid for 12 (twelve) months.

b. Decree of Head of Seruyan District No. 500/1010/EK/2003 on Transition of Location Permit for the Purposes of Oil Palm Plantation Development on behalf of PT. Binasawit Abadi Pratama to PT. Mitratama Abadi Makmur in Seruyan Tengah and Danau Sembuluh Sub-districts of Seruyan District covering 2,463 hectares and valid for 12 (twelve) months.

4. In 2005, after going through application process including measurement of cadastral and discussion by Committee “B”, two


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Documents of Land Use Title were eventually published for two plantation locations as mentioned in Point 2 above through: a. Decree of the Head of National Land Agency No. 16/HGU/BPN/2005 on Provision of HGU for PT. Mitratama Abadi Makmur

covering 4,717.39 hectares which is located in Seruyan Mentaya Ulu Subdistrict and Kota Besi Subdistrict, Kotawaringin Timur District in according to the Map of Land Sector dated 23 June 2004. Certificate of HGU No. 29 dated 5 October 2005. There is a document contained minutes of examination committee of land “B” dated 29 September 2004 which became the basis for issued Land Use Title (HGU). In the HGU, it is mentioned that status of the area is KPP and KPPL according to the Neighborhood Association/Community Association of Central Kalimantan Province (Local Government Regulation No. 8 year 2003).

b. Decree of the Head of National Land Agency No. 15/HGU/BPN/2005 on Provision of HGU for PT. Mitratama Abadi Makmur covering 3,561.84 hectares which is located in Seruyan Subdistrict and Danau Sembuluh Subdistrict, Seruyan District in accordance to the Map of Land Sector dated 23 June 2004 No. 4/2004. Certificate of HGU No. 12 dated 5 October 2005. In the HGU, it is mentioned that status of the area is KPP and KPPL according to the Neighborhood Association/Community Association of Central Kalimantan Province (Local Government Regulation No. 8 year 2003). There is a document contained minutes of examination committee of land “B” dated 29 September 2004 which became the basis for issue Land Use Title (HGU)

There are also: - Letter from the Director of PT. Buana Artha Sejahtera No. 04/D&L-BAS/JKTO/X/2012 dated 18 October 2012 to the Head of

Seruyan District concerning Principle Permit Application for Location Permit Renewal on behalf of PT. Buana Artha Sejahtera. - Letter from the Director of PT. Buana Artha Sejahtera No. 05/D&L-BAS/JKTO/X/2012 dated 18 October 2012 to the Head of

Kotawaringin Timur District concerning Principle Permit Application for Location Permit Renewal on behalf of PT. Buana Artha Sejahtera.

In Progress: - Letter from the Director of PT. Buana Artha Sejahtera No. 42/CDL/-BAS6/XI/2012 dated 13 November 2012 and Map Attachment

to Minister of Forestry of Republic of Indonesia concerning Application for the Completion of Forest Releasing/Forest Exchanging in accordance with Government Regulation 60 Year 2012.

- Attendance List meeting of preparation for field-checking by Government of Kotawaringin Timur related to the licensing matter for PT. Buana Artha Sejahtera on Thursday 31 January 2013.

- Photo documentation of field-checking activities by Local Government of Kotawaringin Timur related to the licensing matter for PT. Buana Artha Sejahtera on Thursday 31 January 2013.


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

Based on the documents verification of Identification of High Conservation Value Report (PT. Tapian Nadenggan and PT. Buana Artha Sejahtera) information from village head and community leaders when visit (for example in Biru Maju and Pantap Village); as well as information from National Land Agency of Seruyan District, it is known that there are not any areas around the estate which are customary lands or ulayat.


PRINCIPLE #3 Commitment to long-term economic and financial viability


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3.1 There is an implemented management plan that aims to achieve long term economic and financial viability.

Examination of the document showed that PT. Tapian Nadenggan and PT. Buana Artha Sejahtera have a good management plan to achieve economic security and long-term finance. It is demonstrated in the form of Budget Plan year 2013 – 2020 which contains detailed information of profitability, revenue, cost and other assumptions used in the planning, FFB production (yiled) and CPO production (yield/hectar). The 2013-2020 budget planning document, added with years of planting monitoring document showed that in PT. Tapian Nadenggan and PT. Buana Artha Sejahtera there are no plants qualify replanting criterion within the period of the next 5 years.


PRINCIPLE #4 Use of appropriate best practices by growers and millers

4.1 Operating procedures are appropriately documented and consistently implemented and monitored.

PT. Tapian Nadenggan and PT. Buana Artha Sejahtera had SOP the best plantation practice from land preparation to harvesting compiled by MCAR (Management Committee Agronomy and Research). In addition, PT. Tapian Nadenggan and PT. Buana Artha Sejahtera have SOP processing of oil palm produce CPO and PK in the Palm Oil Mill. The SOP has included procedures in Palm Oil Mill starts from receiving FFB to the final effluent and delivery of CPO and Kernel. For operational monitoring, PT. Tapian Nadenggan and PT. Buana Artha Sejahtera have internal audit procedures that are held regularly, namely: Operational Internal Audit (OIA), Agronomy Audit and Advisory (AAA), Mills Audit Advisory (MAA), harvest Audit, and seedling material audit (if necessary). operational activities are reocerded by software SAP (release 3). The software has been used since 1996 and contains the full range of daily transaction information, periodic resume, actual report, monthly estate report, mills report, KCP report, bulking report, hectare statement, Mature Plant report, Immature Plant report, manure upkeep, production cost, and others.


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

To maintain and improve the soil fertility to optimal level and sustained yield, the efforts have been made by the company as follow: 1. Company has conducted soil analysis, leaf analysis and visual observation in the field. Details are described as follow:

a. Soil Analysis. Company shawn records of soil analysis conducted by SMARTRI (Smart Research Institute) every 5 (five) year. Since 2012, sampling of soil analysis for the first phase is conducted every 3 (three) years. For example, the sampling conducted in 2012 for the planting year of 2009, the sampling conducted in 2013 for the planting year of 2010 and so on. After that, periodic soil analysis is conducted every 5 (five) year for each planting year up to 1 (one) year prior to replanting. There is a record available of soil sampling and level of soil fertility measurements. For example, the results of soil analysis conducted in Semilar Estate and Mandang Estate on 22 July 2010 as follow: - SMLE 1 Block J67: Sample Code 0-10 P; Moisture Content 4.68%; pH H2O 3.9; pH KCl 3.79; C Organic 3.66; N total

0.21; C/N 17; P available 9.15 ppm; KTK/100g = 10.78; Ca/100g = 2.06%, Mg/100g 0.60%; K/100g = 0.35% and Na/100g = 0.08%.


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- MNAE 1 Block F26: Sample Code 0-10 P; Moisture Content 2.31%; pH H2O 3.99; pH KCl 3.78; C Organic 1.94; N total 0.13; C/N 15; P available 13.36 ppm; KTK/100g = 6.23%; Ca/100g = 0.16%, Mg/100g 0.11%; K/100g = 0.14% and Na/100g = 0.07%.

b. Leaf Analysis Company has also conducted leaf analysis every year. The analysis is performed by SMARTRI. The result of leaf analysis becomes a basis for consideration to determine manuring recommendation to fit the needs of the plants. Company shown records of leaf analysis from 2009, 2010, 2011 and 2012. Below is an example of leaf analysis for the period of 2012 in Semilar Estate. - Semilar Estate division V Block I48 sample reception 31 May 2012 with the result of analysis: content of N: 2.91 %; P =

0.181%; K = 1.06%, Mg = 0.29%, Ca = 0.99 %, Mn: 378 ppm; B: 23 ppm; Zn = 16 ppm; Cu: 4 ppm; Cl = 0.72% and Fe 117 ppm.

- Semilar Estate division IV Block I46 sample reception 06 June 2012 with the result of analysis: content of N: 3.11 %; P = 0.213%; K = 1.17%, Mg = 0.34%, Ca = 0.83 %, Mn: 426 ppm; B: 20 ppm; Zn = 17 ppm; Cu: 11 ppm; Cl = 0.61% and Fe 125 ppm.

c. Visual Observation conducting soil and leaf analysis, SMARTRI also conducts visual observation during the sampling activity in the field. Visual observation is a consideration in determining manuring recommendation, and analyze potential disease to become endemic disease.

conducting soil analysis, leaf analysis and visual observation, the sampling should considered year of planting, type of soil and type of seeds used. 2. Company has been applied manuring, empty fruit bunches application and managed the palm oil mill effluent for Land

Application. The records are available. For example: - Manuring location (Block E-43), Number of main trees (4.087 palms), Dose of Urea 1.250 Kg/Palm/semester), volume of

urea (5.100 Tons), Date of application 2 August 2012 (4.400 ton) and on 13 August (0.7 ton); Dose of TSP 0.75 Kg/Palm/semester), volume of MOP (3.150 Ton) date of application 2 August 2012 (2.650 Tons) and on 13 August 2012 (0.4 Ton); Dose of MOP 2 Kg/Palm/semester), volume of Kies Grand (8.150 Tons) date of application 28 July 2012 (7.050 Tons) and 13 September 2012 (1.100 tons).

- Empty Fruit Bunch manuring location in SMLE is in Block K57, the area covered 5.01 Ha and the dose used 60 tons/hectare (based on the Guide Book of Technical Cultivation of Oil Palm Sinar Mas 2007 point 7.4.1 with the dose of 60 tons/ha/year) implemented on 9 March 2012 in the amount of 301 tons.

- Empty Fruit Bunch manuring location in MNAE is in Block F40, the area covered 10.8 ha and the dose used 60 tons/hectare (based on the Guide Book of Technical Cultivation of Oil Palm Sinar Mas 2007 point 7.4.1 with the dose of 60 tons/ha/year) implementer on January in the amount of 168 tons, February 64 tons, October 140 tons and November 60 tons.

- Records of POME application in Block J-3 around 29 hectares with the volume of 3,635 M³ (125 M³/1 time rotation, in a year there are 3 rotations = 375 M³/ha/year).

Based on the document observation, the average production of the estate (in actual period of January 2012 – January 2013) is 35.77/tons/year.


4.3 Practices minimize and control erosion and degradation of soils.

The Efforts have been made to minimize and control erosion and degradation of soil as follow: 1. Company shown land maps for each estate in PT. Tapian Nadenggan and PT. Buana Artha Sejahtera. The land maps are written

in document of map album with the title ”Land Map of Semi-Detailed Soil Survey” in the scale of 1:50,000. The maps contained units of soil map including information of soil classification, texture, depth, drainage, limiting factors, rocks and compliance


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information for the development of oil palm plantation. Based on the map, the company has strived for the land management according to the soil classification and its compliance information.

2. Company have procedure on managing the area with a certain slope. The procedures are presented in the Guide Book of Technical Cultivation of Oil Palm Sinar Mars, particularly in Chapter V with the details as follow: a. Section 5.7 on the Land Clearing and Planting that describes the pegging and planting in slope area. b. Section 5.9 on the land conservation that describes procedures of land conservation through: terrace conservation, contour

terrace, hooves with silt-pit and conservation plants. Based on observation in Semilar Estate and Mandang Estate, the efforts has been made to the manage the area with a certain slope are contour terracing, midrib-stacking on the edge of the terrace, and planting neprolephis inside the blocks.

3. There is soil maps that inform about soil classification, texture, depth, drainage, limiting factors, rocks and compliance information

for the development of oil palm plantation, the company has arranged a road maintenance program to ensure the FFB from the estate successfully delivered to Semilar Mill. There is a document of road maintenance in the form of:

- Budget of manual road maintenance (sample: work program in the year of 2012) - Budget and maps of road-hardening (sample: budget of road hardening 2012 and map of road-hardening 2012 for

Semilar Estate) - Monitoring the implementation of manual road maintenance (sample: monitoring of the manual road maintenance in the

year of 2012) - Monitoring the implementation of road-hardening and maps of the location every month (sample: recapitulation of laterit

transporting in Mandang Estate in July – November 2012 and the maps of road-hardening implementation in Mandang Estate and Semilar Estate).

Based on the observation in Mandang and Semilar Estate, the road maintenance in PT. Tapian Nadenggan and PT. Buana Artha Sejahtera are well maintained with good drainage.

4. Based on the soil survey, there is no peat area within the company‟s operational area.

5. Strategy of marginal soil management and other critical soil such as sandy soil, soil containing sulphuric acid, and soil with low

organic content, have considered the result of soil survey. Based on the result of land suitability classes, there are marginal soil identified especially sandy and low organic content areas. For sandy soil management the company already has SOP No. SOP/TN/LKL-14 on the Management of Sandy Areas which was compiled on 1 March 2012 and approved by VPA Kalteng. Management of sandy areas and soil with low organic content is conducted by applying empty fruit bunch application. For example: Location of Empty Bunch manuring in SMLE Block K57, the area covered 5.01 Ha with the dose 60 tons/Ha (based on the Guide Book of Technical Cultivation of Oil Palm Sinar Mas 2007 point 7.4.1 with the dose of 60 tons/Ha/year) had been implemented in the amount of 301 tons on 9 march 2012. Based on the field observation, empty bunches had been applied to those areas.


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

Type of surface water in the area of PT. Tapian Nadenggan and PT. Buana Artha Sejahtera is river. There are not any wetland ecosystems such as swamps and peat bogs. Watershed protection has been conducted by establishing the riparian, planting erosion-preventing plants, monitoring the river water quality, monitoring well water used by workers, and monitoring the ground water in the draw well of Land Application. Records of the protection activities are well-provided, such as: document of the installation of riparian signs, the monitoring of riparian protection, laboratory test for river water quality and draw well water quality. For water source protection, PT. Tapian Nadenggan also has monitored the quality of effluent discharged from Semilar POM that is regularly flowed out to the Land Application every month. The parameters complied with regulation and the testing that was performed by an accredited laboratory. Report of the BOD


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monitoring result for the 2nd semester of 2012 is available. Monitoring the water consumption in the mill is also well-managed. Data of water usage is collected daily and recapitulated in one month for the purposes of reports and analysis. The records of water usage monitoring every month for 2012 showed that the average of water usage is still below the targeted budget. Saving water usage, management of Semilar POM has implemented such as: campaigning water-saving through periodical briefing, installing warnings and stickers “Save the water” signs in the locations of water use, and also maintaining the equipment at regular interval to prevent water leakage.


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

Controlling pests, diseases, and weeds in the estate area, company has made these following efforts: 1. Company already has a program of Integrated Pest Management (IPM), for example:

There is an early detection program of Palm Leaf Eater Caterpillar and other pests (Oryctes and Ganoderma) available that is performed every 2 (two) months.

Rat census is conducted in January, April, July and October (4 times a year).

There is a planting plan of beneficial plants available for the year 2012-2013 namely Turnera Subulata, Antigonon, and maintenance of Neprolephis sp.

There is a program of owl nest building in 2012, for example in Division 3 SMLE, from 24 nests planned all nests have been built with the number of active nests is 2 and inactive nests is 22. Total nests planned in SMLE is 113, all have been built with the number of active nests is 2 and inactive nests 111.

2. Company has also conducted IPM extent monitoring including providing the training for workers to ensure their occupational

skills. For example:

There is a document of the Recapitulation of Palm Leaf Eater Caterpillar which explains sampling location, land area, number of trees affected, number of sampling trees and types of the palm leaf eater caterpillar. For example, monitoring activity on 8 September 2012 in Block H39 MNAE showed that average population of the caterpillar is 1.9% below the threshold (6-10 caterpillars/stem).

There is document of data plan and implementation of nest building every month. Until the stage-, 24 nests have been implemented in SMLE and 23 nests have been implemented for MNAE area.

There is document of plan and implementation of planting/maintaining the biological control agent plants (Turnera, Antigonon and Cassia) in 2012. For example, in Division 1 MNAE: Plan: (Cassia cobanensis 12,225 M, Turnera subulata 10,630 M, Antigonon leprosus 2,126 M). Implemented: (Cassia cobanensis 9,047 M, Turnera subulata 8,518 M, Antigonon leptosus 1,346 M).

There is document of maintenance and planting implementation of the plants (Turnera, Antigonon and Cassia) in the Report of Treatment and Rehabilitation of the Host Plant and Biological Control Agent. For example: During the 2nd half of the year in SMLE have been planted Cassia cobanensis for 32 m, Turnera Subulata 27 m and Antigonon leptosus 20 m with the total length of 79 m. In the 2nd semester of 2012 in SMLE, from the Plan of Cassia cobanensis 496,800 m, Turnera subulata 179,196 m, Antigonon leprosus 165,612 m, which is implemented Cassia cobanensis 184,117 m, Turnera subulata 59,683 m, Antigonon leptosus 64,248 m.

There is record of IPM training. For example: Record of Integrated Pest Management Training by SMATRI PSM 6 on 19 October 2011 at Semilar Junior High School (Semilar Estate) attended by 37 workers (materials, attendance list and documentation photos available) and Record of Integrated Pest Management Training by SMATRI PSM 6 on 20 October 2011 at Hall of Mandang Plantation Elementary School (Mandang Estate) attended by 28 workers (materials, attendance list and documentation photos available).

3. Company has also conducted Pesticide Toxicity Monitoring with active unit/LD50/ton FFB.


ASSESSMENT REPORT


There is record of pesticide toxicity monitoring in the document of Pesticide Toxicity 2012 that explains the product name of pesticide, active ingredients, active ingredient contents, number of application, and total of active ingredients, FFB production and active ingredient/ton FFB. a. Pesticide Toxicity Data of SMLE: Erkafuron 20 WG; active ingredient Metsulfuron-Methyl 20%; number of application 71.77

kg; total of active ingredient 14.35 kg; FFB 117,813.93 tons; active ingredient/LD50/ton FFB is 0.0000000244 kg/ton FFB. b. Pesticide Toxicity Data of MNAE: Erkafuron 20 WG; active ingredient Metsulfuron-Methyl 20%; number of application 88.15

kg; total of active ingredient 17.63 kg; FFB 109,373.91 tons; active ingredient/LD50/ton FFB is 0.000000032 kg/ton FFB.


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

To ensure that agrochemicals are used undanger for workers‟ health and environment, company has made these following efforts: 1. Ensuring that agrochemicals used have been registered and approved by the competent institution.

There is a List of pesticide used by the company. The list refers to the Book of Pesticide for Agriculture and Forestry 2011 published by Directorate of Fertilizer and Pesticide under the Directorate General of Agriculture Facility and Infrastructure of the Ministry of Agriculture Republic of Indonesia which explains the product name of pesticide, registration number proving that agrochemicals used are registered, and the target weeds.

Rolixone 276 SL; Registration No. R.I 0101301120062467 active ingredient Paraquat Dichloride 276 g/l for broadleaf weeds.

Starane 290 EC Registration No. RI 3155/3-2008/T active ingredient Fluroxypyr for broadleaf weeds.

Erkafuron 20 WG; Registration No. R.I 01030120062405 active ingredients Metsulfuron Methyl for broadleaf weeds.

Klerat; Registration No. R.I 1715/8-2007/T active ingredients Brodifacum for rats.

Roll Up 480 SL with Reg. No. 2133/4-2009/T for narrow-leaf weeds.

2. Using pesticide in appropriate dose and target. There is a Recapitulation of pesticide usage in Semilar Estate per month in 2012 that describes types of pesticide, active ingredient, application area, dose per hectare and the total of use. There is also Book of Work Program of the year 2012 that informs about the work plan and implementation including the use of pesticide. For example, in Semilar Estate Division VI circle spraying/harvesting path activities with the number of rotation 3 times a year; pesticide used for Rotation 1 is Roll Up/Erkafuron, for rotation 2 is Rolixone/Erkafuron and for rotation 3 Roll Up/Starene; blocks and the size of application.

3. Using pesticide in accordance with the best practice of pesticide usage and carried out by well-trained personnel. a. Company have Material Safety Data Sheet (MSDS) for each type of agrochemicals (pesticide) which describes instruction of

storage and handling of the materials, handling in case of accidents (first aid emergency effort), hazard identification, actions against spills and leaks, personal protective equipment, physical and chemical characteristics, reactivity and stability, toxicology information, ecology information, waste disposal and transportation.

b. Company have MSDS for each type of fertilizers used. The MSDS describes product identification, composition of fertilizer, fire and explosion, stability and reactivity, health risk, specific attention and leaks, spills and disposals.

c. Company has trained pesticide operators on 25 to 26 May 2012 at SRGE Sports Hall which was attended by 42 operators from SMLE and 58 operators from MNAE (attendance list, training materials and documentation photos are available). There are also certificates of training for example: certificate on behalf of Eko Siswoyo (spray operator from MDAE) No. 090/748.03/DISBUN/2012 and on behalf of Rizal Fandi (spray operator from SMLE) No. 090/327.203/DISBUN/2012 dated 25 May 2012 approved by Head of Plantation Agency of Kotawaringin Timur.

d. company already have document of manuring recommendation based on soil analysis, leaf analysis and visual observation. For the dose of pesticide, it refers to dosage recommendation contained on any types of pesticide labels.

4. Management of pesticide packaging waste is conducted in accordance with technical guidance and applicable rules and


ASSESSMENT REPORT


regulations. Management of agrochemicals waste including pesticide packaging waste refers to the procedures that have been compiled by the company namely SOP of Waste Management No. SOP/SPO/SMART/LH-09 dated 1 July 2010. Point 6.3.b explains that used pesticides package have been washed then returned to Supplier and the residual water from the washing of the packaging are reused for the subsequent mixing process. Based on the SOP, the company has compiled work instructions about washing procedures before the packaging waste is stored and returned to the supplier. Based on the Work Instruction of Washing and Cleaning of the Pesticide and Fertilizer Packaging, the used pesticides packaging are washed 3 (three) times (according to MSDS). Residual water from the washing process is reused as a mixture of toxin (pesticide) in accordance with its type.

5. agrochemicals categorized as type 1A and 1B by the WHO including paraquat are reduced and the use of those agrochemicals must meet the applicable regulations. There is a policy of paraquat usage issued by The Vice President of Agronomy of PT. Tapian Nadenggan and PT. Buana Artha Sejahtera (Mr. Robert Samosir). In the document of the policy stated that the company is committed to continuously control the environmental aspects and to prevent the environmental impacts as well as to create a safe working environment for all workers due to the use of paraquat chemicals. One of the policy points stated that company able to comply with the regulation about use of paraquat in accordance with the applicable regulations. Regulation of Ministry of Agriculture of RI No. 24 year 2011 mentioned that any persons who uses limited pesticide (paraquat) must receive a training from relevant authorities. Certificates valid for 5 years so that, company has conducted trainings for applicators of paraquat in conjunction with the implementation of policy of paraquat reduction. The records are: A. Record of paraquat usage conducted on 20 May 2012 by PT. Rolimex in cooperation with Plantation Agency of Kotawaringin

Timur District.

There is evidence of training attendance list of limited pesticide use (58 participants from Mandang Estate) located in Sungai Rungau Estate.

There are training certificates of limited pesticide use (Mandang Estate) valid until May 2017. For example, Certificate No. 090/ 327.45/DISBUN/2012 on behalf of Utami Yekti (Spray Worker) for Mandang Estate work unit.

There is evidence of training attendance list of limited pesticide use (42 participants from Semilar Estate) located in Sungai Rungau Estate).

There are training certificates of limited pesticide use (Semilar Estate) valid until May 2017. For example: Certificate No. 090/ 327.193/DISBUN/2012 on behalf of Ihwanus (Spray Worker) for Semilar Estate work unit.

B. There is a documentation of the trend of paraquat use in Semilar Estate (PT. Tapian Nadenggan) and Mandang Estate (PT. Buana Artha Sejahtera). Based on the documentation of the trend of paraquat use in Semilar Estate and Mandang Estate is decrease every year.

0

1000

2000

Year 2010 Year 2011 Year 2012

Trend of Paraquat USE at SMLE (2010-2012)

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1000

2000

3000

Year 2010 Year 2011 year 2012

Trend of Paraquat Use at MNAE (2010-2012)


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6. Periodic medical check up for workers who contact with chemicals.

There is Letter Ref No. 068/HR OPS/01/11 on 3 January 2011 regarding the Occupational Health and Safety of the Spray Workers. Point 2 declared that spray workers who contact with agrochemicals required to medical chechk up regularly every 6 (six) months with a doctor or nurse. Company cooperates with the 3rd party namely Company Hygiene and Occupational Health of Manpower and Transmigration Agency in Pontianak, for examination cholinesterase. Company shown as follow:

a. SMLM examination was conducted on 7 June 2012, examined 10 workers with the following result: 1 person sustain moderate poisoning, 2 persons sustain mild poisoning and 7 persons are healthy. The person who have moderate poisoning was recommended to be transferred to job not related with chemicals by KT3 Regional Doctor. There is a Transfer Notification No. 003/SMLM/INT/09/2012 on behalf of Ridwan from Water Treatment Department as an operator transferred to Compound per 1 October 2012.

b. SMLE examination was conducted on 7 June 2012, examined 58 workers. Based on medical check up result: 5 persons were transferred to manual treatment. There is a Transfer Decree No. 008/SK/SMLE/X/2012 on behalf of Sumarji who was transferred to manual treatment and No. 010/SK/SMLE/X/2012 on behalf of Abdul Hakim who was transferred to manual treatment as well. The Decree applied on 2 October 2012.

c. MNAE examination was conducted on 7 June 2012, examined 55 workers. Based on medical check up result 7 persons were transferred to manual treatment. There is a Transfer Decree No. 026/SK/MNAE/X/2012 on behalf of Dwi Syahputra per 1 October 2012. Based on the recapitulation document of periodical examination, the next examination was conducted on 27-28 December 2012. The result of examination until the assessment has not been issued by the HIPERKES of West Kalimantan.

7. Ensuring that there are no female workers who are pregnant or breastfeeding contact with chemicals. a. There is a Circular Letter available from the Director Ref. No. 104/HR PSM 6/01/11 dated 3 January 2011 on the OHS of

spray workers. b. There is also a Memorandum available from the VPA PSM 6 No. 01/VPA-RSPO/03/2010 dated 3 March 2010 stated that

pregnant and breastfeeding female workers are not allowed to work as spray workers. c. Evidence of policy implementation:

SMLE: Based on data of the List, it is known that all spray workers are male. Based on observation in Block H-48 of Semilar Estat, all spray workers in SMLE are male.

MNAE: There is document of the result of midwife examination every month for spray workers on 5 November 2012 that stated Mrs. Khomsiatun (NIK 12051) was pregnant and recommended to transfer to a light work as a nanny in the Day Care and also treats the host plants of Biological Control Agents. Transfer Letter from the Estate Manager on 6 November 2012.


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

There are Occupational Safety and Health policies in each working unit: a. At Semilar Mill, it was authorized in December 2011 by the Mill Manager and the Chairman of the SPM (the Independent

Laborer Union) unit SMLM. b. At Semilar Estate, it was authorized in September 2011 by the Semilar Estate Manager and the Chairman of the SPM (Serikat

Pekerja Mandiri) unit SMLE. c. At Mandang Estate, it was authorized in May 2011 by the Mandang Estate Unit Head and the Chairman of the Mandang Estate

SPP (Estate Laborer Union). The policies regulate all activities must responsibilities to social and ethical and give equal priority to Occupational Safety and Health, Environmental Hygiene and work discipline which includes production, quality, volume, and cost. It is the responsibility both of the board of executives and the employees to give equal priority related to implementation of Occupational Safety and Health, decrease hazards that might cause work accidents and other inconveniences. Revisiting the content of these policies, if there is a new regulation.


ASSESSMENT REPORT


The Occupational Safety and Health policy Socialization 1. There are records of Occupational Safety and Health socialization at Pondok 1 SMLE on 24 May 2012 which was attended by 116

employees (there are an attendance list and photographs of the activity), at Pondok 2 Semilar which was attended by 129 employees (there are an attendance list and photographs of the activity), on 26 July 2012 at Pondok 3 SMLE which was attended by 45 employees (there are an attendance list and photographs of the activity), and at Pondok 3‟s Rumah Pintar on 10 May 2012 which was attended by 70 employees (there are an attendance list and photographs of the activity).

2. At SMLF on 7 May 2012, attended by 67 employees (there are an attendance list and photographs of the activity). 3. MNAE: There are records of Occupational Safety and Health socialization at Pondok 1 MNAE on 05 June 2012 which was

attended by 40 employees (there are an attendance list and photographs of the activity), at Pondok 2 Semilar which was attended by 16 MNAE employees (there are an attendance list and photographs of the activity), on 26 July 2012 at Pondok 3 SMLE which was attended by 108 MNAE employees (there are an attendance list and photographs of the activity).

The socialization of Occupational Safety and Health policies at Semilar Mill, Semilar Estate and Mandang Estate also through bulletin boards and explanations during briefing before starting work. The implementation of Occupational Safety and Health policies as follow: The company formed a Guiding Committee of Occupational Safety and Health in order to implement the occupational safety and health program in each working unit. The structure of the Guiding Committee of Occupational Safety and Health includes the Steering Committee, the Chairman, the Vice Chairman, the Secretary, the Evaluation Division, the Monitoring Division, the Research Division, the Extension Division, and the Health Division.

1. The Semilar Mill Guiding Committee of Occupational Safety and Health was authorized by Seruyan District‟s Labor, Transmigration, and Tourism Agency letter number 560/1482/KEP/DISNAKERTRANSPAR/X/2012 on 18 October 2012, naming Surya PJ Saragih as Secretary (certificate number 10.4839/AK3-U/DJPPK-P2K/VI/2010) and as the General Occupational Safety and Health Expert (Number SKP.1360/DJPPK/AK3-U/VI/2010), authorized on 29 June 2010 and is in effect for three years.

2. The Semilar Estate Guiding Committee of Occupational Safety and Health was authorized by Seruyan District‟s Labor, Transmigration, and Tourism Agency letter number 560/2075/KEP/NAKTRAN/XII/2011 on 20 December 2011 naming Angga Reksa as Secretary (certificate number 1090/AK3/U/V/2011) and as the General Occupational Safety and Health Expert (Kep.1124/M/DJPPK/V/2011), authorized on 23 May 2011 and is in effect for three years.

3. The Mandang Estate Guiding Committee of Occupational Safety and Health was authorized by Seruyan District‟s Labor, Transmigration, and Tourism Agency letter number 560/1170/KEP/DISNAKERTRANSPAR/VII/2012 on 31 July 2012, naming Danar Wijayanto as secretary (certificate number 10.4819/AK3-U/DJPPK-P2K/VI/2010) and by the appointment decree number (SKP number 1340/DJPPK/AK3-U/VI/2010) authorized on 29 June 2010 and is in effect for three years.

The Guiding Committee of Occupational Safety and Health‟s routine meetings are held one a month at each working unit, for example:

1. The Guiding Committee of Occupational Safety and Health meeting at MNAE on 7 January 2013 was attended by 8 committee members (there are an attendance list, minutes of the meeting, and photographs of the event) and on 28 December 2012 was attended by 13 committee members (there are an attendance list, minutes of the meeting, and photographs of the event).

2. The Guiding Committee of Occupational Safety and Health meeting at SMLE on 19 January 2013 was attended by 8 employees (there are an attendance list, minutes of the meeting, and photographs of the event) and on 17 December 2012, attended by 11 committee members (there are an attendance list, minutes of the meeting, and photographs of the event).

3. The Guiding Committee of Occupational Safety and Health meeting at SMLE on 19 January 2013 was attended by 8 employees (there are an attendance list, minutes of the meeting, and photographs of the event) and on 17 December 2012, attended by 11 committee members (there are an attendance list, minutes of the meeting, and photographs of the event).

The company involves all employees in the Labour Social Assurance Program (JAMSOSTEK). For full-time employees (SKU-B and SKU-H) it covers a Retirement Insurance, Life Insurance, and Occupational Accident Insurance , while for BHL workers, it covers Occupational Hazard Insurance and Life Insurance. There are JAMSOSTEK registration forms for the employees and the payment


ASSESSMENT REPORT


receipt, such as: 1. There is the SMLE List of JAMSOSTEK dues in December 2012 for 200 BHL employees, paid on 30 November 2012. The

payment of SKU JAMSOSTEK dues in December 2012 for 385 of 414 employees becouse 29 people resigned (there is a payment receipt to Mandiri Bank).

2. There is the MNAE List of JAMSOSTEK dues in December 2012 for 366 BHL employees, paid on 06 December 2012. The payment of SKU JAMSOSTEK dues in December 2012 for 455 employees, 23 additional employees, and 4 resigned, so the total number of employees paid on 27 December 2012 are 474, (there is a payment receipt to Mandiri Bank).

Routine medical check-ups for all employees (both low and high-risk) conducted annually by the company‟s doctor (Ida Bagus Gede Rasi Mahendra Diputra, holder of the physician‟s registration SKP number Kep.145/PPK-PNK3/KK/X/2010) which cover physical examinations (height, weight, and blood pressure) and specific examinations for high-risk employees every six months (in June and December). The company collaborates with a third party, company hygiene & occupational health, Manpower and Transmigration Agency, Pontianak, in conducting cholinesterase checks for employees who handle chemicals, audiometry for workers who work in noisy areas, and spirometry for employees who exposed dust hazards. 1. Physical Examinations

a. At SMLM, the check-up conducted on 07 July and 19 July 2012 for 169 employees and all employees declared healthy. Based on the Health Check-Up Program, the next physical check-up will be scheduled in February 2013

b. At SMLE, the first semester ‟s check-up conducted in January and February 2012 for 337 employees and all employee declared healthy. Based on the 2013 Health Check-Up Program, the next physical check-up will be scheduled in February 2013

c. At MNAE, the second semester‟s check-up conducted in August 2012 for 313 employees and all emplyee declared healthy. Based on the 2013 Health Check-Up Program, the next physical check-up in 3 and 10 January for 385 and all employees declared healthy.

2. Cholinesterase a. At SMLM, the check-up conducted on 7 June 2012 for 10 employees. The results were used as guidance to decrease

occupational hazards. For example, the working rotation on behalf of Ridwan, the operator of Water Treatment Department transferred to the Compound onf 1 October 2012 (decree number 003/SMLM/INT/09/2012). Based on the routine check-up recapitulation document, the second semester check-up conducted on 27 and 28 December 2012 for 10 mill workers (4 laboratory workers, 4 WTP workers, and 2 warehouse workers) but the examination results have not yet been released by West Kalimantan‟s The Company Hygiene and Occupational Health.

b. AT SMLE, the check-up conducted on 7 June 2012. The number of employees checked was 58 people. Based on examination result, 5 people were transferred to manual maintenance, for example Sumarji (transfer letter number 008/SK/SMLE/X/2012) and Abdul Hakim (010/SK/SMLE/X/2012). The transfers were effective in 02 October 2012. The next check-ups conducted on 27 and 28 December 2012 for 52 employees, 42 SRDE employees, 37 PURE employees, and 48 MNAE employees (sprayer workers, warehouse workers, heavy equipment operators). The results have not yet been released by West Kalimantan Company Hygiene and Occupational Health.

c. At MNAE, the check-up conducted on 7 June 2012. The number of employees were 55 people. Based on the results, 7 people were transferred to manual maintenance, for example Dwi Syahputra (transfer decree number 026/SK/MNAE/X/2012) as of 1 October 2012. The next check-up have been scheduled on 27 and 28 December 2012 for 51 employees (sprayer workers, warehouse workers, heavy equipment operators). The results have not yet been released by West Kalimantan Company Hygiene and Occupational Health.

3. Audiometry Based on the routine audiometry check-up recapitulation document for employees of Region 3 Central Kalimantan,the audiometry conducted on 6 June 2012 for 32 employees, 5 PURE employees, 1 MNAE employee, 4 SRDE employees, and 21 SMLM employees. The second semester check-up was conducted on 27 December for 37 factory workers (12 boiler workers, 6 nut and kernel workers, and 6 engine-room workers, 11 generator set workers at the estate, 1 MNAE generator set operator, 6 SRDE generator set operators, and 6 PURE generator set operators). The results have not yet been released by West Kalimantan Company Hygiene and Occupational Health. 4. Spirometry The spirometry check-up conducted on 7 June 2012. There is a recapitulation of the routine spirometry check-up for Region 3 Central


ASSESSMENT REPORT


Kalimantan employees for heavy equipment operators, boiler workers, and nut and kernel division workers totaling 18 people. The official results have not yet been released by West Kalimantan Company Hygiene and Occupational Health. Based on the interviews with sprayers at the estate and the boiler operator, it was concluded that the check-up has been conducted routinely. There is a Hazard Source Identification, Assessment, and Risk Control Procedure (SOP/SMK3/SMART/LH-02) which was authorized on 1 July 2010 by the Head of the Environtment & Sustainability Division. There is a July 2012 – June 2013 period Hazard Source Identification, Assessment, and Risk Control Review document for all mill and estate activities which include activities, source/event, impact, existing control, and preliminary risk analysis (probability level, magnitude level, and risk level) at the POM and Estate. Dissemination of the 2012-2013 period Hazard Source Identification, Assessment, and Risk Control was conducted on 9 July 2012 at SMLM and attended by 49 mill workers (attendance list and the invitation are available). Based on the interview with the workers such as block I35 harvest foreman and J45 sprayer foreman, concluded that both foremen and workers are aware of the dangers posed of the activities. There are Safety Permits for certain jobs, for example:

1. Work on Height Permit, covering the permit requester, the number of workers, the date, location, type of job, job description, personal protective equipment and tool inspection, hazard identification, work location inspection, authorization, and job acceptance. For example the work-permit for St. Loading Ramp on 30/12/2012 job description (line A elevator dirt over haul).

2. Work Permits for Limited Areas such as the Sterilizer, the Boiler, the Storage Tank, etc. This explains about the workers‟ health status, ensuring the safety of the area (pressure free, empty, flushed with water, all fire hazards cleared, fire fighters and fire extinguishers on stand-by, all machines and equipment on safety position, wind direction and suitable personal protective equipment considered). For example the permit for working on the Sterilizer for mechanics on 25 November 2012, the job description was installing the stainer condensate in sterilizer number 1, 2, 3 and 4.

There are also Job Instructions that explain the Occupational Safety and Health aspect and the Personal Protective Equipment that should be used. For example, in the Job Instructions for Fruit Cutting Document Number IK/MCAR/11/05-07/01 dated 03 January 2012, fruit-harvesting activities which are included in the aspects to be controlled by Occupational Safety and Health are being struck by falling fruit/palm midribs, being stabbed by thorns, and being stabbed by a plane; the Personal Protective Equipment that must be used are shoes, planning gloves, and a helmet. According to the interview with harvest workers, concluded that the harvesting has been conducted in a safe way and they used Personal Protective Equipment. Based on the field visit at Semilar POM, there is evidence of the implementation of safety measures against occupational hazards, for example the factory is equipped with a “visitor lane”, safety induction, warning signs, signs for isolation areas and areas under maintenance, for example in Loading Ramp, dangerous equipment is placed in isolated areas, machine panels are isolated and safeguarded using locks, and the implementation of the LOTO system for machinery under maintenance such as at Capstan No. 11. Occupational Safety and Health trainings are conducted at each working unit, i.e.: a. Training fire extinguishers utilization on 26 November 2012 was held at the SMLE KT3 sports center in collaboration with the

supplier, Jaya Mandiri, and Sampit Fire Brigade. The event was attended by 33 employees. b. First Aid training was held on 22 January 2013 at the SMLM Meeting Room by Dr. IBGR Mahendra D. and was attended by 16

people (lab analysts, grading officers, foremen, security guards, mechanics, processing workers, electrical technicians, clarification station workers, processing foremen, and the RSPO Officer). There are an attendance list, photographs of the event, and training material.

c. Occupational Safety and Health Licenses for Lifting and Transporting Equipment Operators, for example for Silamon Nur Alifudin (Becholoder Operator) license number 11.634/OPF/KK/I/2011, valid until 17 January 2016; for Sudiyono (Tractor Operator) license number 12.579-OPK3-PAA/I/2012, valid until 27 January 2017; for Sapari (Motor Grader Operator) license number 12.576-OPK3-PAA/I/2012, valid until 27 January 2017.

d. Electrical technician licenses, for example for Eka Ardian Setianto Registration Number 3555/TK3-LIST/II/2012-PO and for Nanang Irawan Registration Number 3354/TK3-LIST/II/2012-PO.


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e. Company Hygiene and Occupational Health Certification for paramedics (nurses), for example for Manimbul Situmorang number 11.017/PM-XIII/10 given through the Company Hygiene and Occupational Health training held by Samarinda Occupational Safety and Health Bureau between 27 and 30 April 2010.

There is SOP/SMK3/SMART/LH-09 for Emergency Response which was authorized on 1 July 2010 for Estate and Mill. In this procedure, explained

Emergencies are fires, explosions, contamination, natural disasters (earthquakes, floods, and landslides), riots, demonstrations, and occupational accidents and reported during and outside office hours.

The duty and responsibility of each emergency response team

The emergency response procedure,

Post-emergency convalescence.

The Emergency Response Team in each mill and estate working unit has: the Steering Committee, the Head of the TKD Team, the Executive Chairman, the Executive Team Chairman, the Secretary, the Evacuation Team, the Safeguarding Team, the Elimination Team, the Extinguishing Team (the Hook pole Group, the Fire Extinguisher Group, the Hydrant Group, the Sand & Mud Group, the Fire Blanket Group, the Health Group, the Connector Group).

Emergency response trainings are: 1. Housing complex fire and earthquake simulations were held on 26 November 2012 at Pondok 2 MNAE, and a brushfire

simulation was held on 29 May 2012 at Pondok 2 SMLE Block A65. The participants were RC/PC, Mill and Estate Unit Heads, SPO and AK3 PICs, the SPO Coordinator, and the Region KT 2 Unit Emergency Response Team. This simulation was a joint-simulation for Region 2, the PT. Tapian Nadenggan (Semilar Mill and Semilar Estate) and PT. Buana Artha Sejahtera (Mandang Estate). Training of fire extinguishers utilization was held on 26 November 2012 at SMLE KT3‟s sports center in collaboration with the supplier, Jaya Mandiri, and the Sampit Fire Brigade. It was attended by 33 employees.

2. Training of fire extinguishers utilization was held on 26 November 2012 dilakukan at SMLE KT3‟s sport center in collaboration with the supplier, Jaya Mandiri, and the Sampit Fire Brigade. It was attended by 33 employees.

Based on the field visit, it found that there is a emergency evacuation path and mustering point at the office, estate housing complex, and mill. The company provides Personal Protective Equipment (PPE) for employees according to the occupational hazards based on the results of the hazard source identification, assessment, and risk-control. For example, sprayers must use Personal Protective Equipment such as goggles, masks, gloves, aprons, and boots. Company monitore every month Personal Protective Equipment, monitoring notes the condition (good or damaged, the number of each kind of Personal Protective Equipment) and description. For example, delivery of gloves and spraying masks to sprayer workers in Division 2 on 21 January 2013 and the documents on the delivery of new Personal Protective Equipment at SMLM on 04 November 2011 to 7 employees. Evidance of the provision for the occupational health and safety program equipment and First Aid kits: a. The fire control facilities and infrastructure provided by the company are fire extinguishers placed in strategic and fire-prone

locations such as all areas of the mill, the chemical warehouse, the diesel fuel tank, and housing complex. Especially for the mill, there is a hydrant with the hose available on site. For example, at Semilar Mill there are 42 fire extinguishers (40 powder and 2 CO2), 7 barrels of BAKORTIBA (fire blankets, water barrels, sand buckets, hook poles), 1 electric pump, 7 box hydrants, 14 units of hydrant hoses, 7 units of nozzles, 7 units of levers, a siren, a fire beater, a stretcher, a First Aid kit, and a fireproof suit, at Semilar Estate there are 34 powder fire extinguishers, a water tank, a water pump, hoses, knapsacks, fire beaters, fire blankets, sand barrels and sand, shovels, machetes, hook poles, an alarm or a bell, a stretcher, and a First Aid kit, and at Mandang Estate there are 31 powder fire extinguishers, buckets, fire blankets, flappers, shovels, axes, fire hoses, hoes, petroleum, hook poles, sand, a water tank (1 unit), robin machines (2 units), machetes, nozzles, and knapsacks.

b. For First Aid, the company provides First Aid kits in every building such as the workshop, housing complex, office, mil area, and warehouse. Besides those, there are also portable First Aid bags for the foremen at each working unit to use when working in the field. For example, at Semilar Mill there are 4 Type B First Aid kits and 1 Type A First Aid kit, at Semilar Estate there are 11 Type A First Aid kits and 48 First Aid bags, and at Mandang Estate there are 11 Type A First Aid kits and 45 First Aid bags. Checking is


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done monthly.

Based on the field visit in the estate and mill, Occupational Safety and Health and First Aid equipment are found on the working sites. The employees obey the obligations to wear Personal Protective Equipment according to their field of work. There is documentation about First Aid training which was given by the company doctor (dr. Ida Bagus Gde Rsi Mahendra Diputra, physician SKP registration number Kep.145/PPK-PNK3/KK/X/2010), i.e.:

1. Training at Semilar Mill on 2 May 2012, attended by 23 employees, foremen and above, at Semilar Estate on 25 February 2012, attended by 66 employees, foremen and above, and at Mandang Estate on 8 August 2012 attended by 60 employees.

2. First Aid training on 22 January 2013 at the SMLM Meeting Room by Dr. IBGR Mahendra D. attended by 16 people (lab analysts, grading workers, security guards, mechanics, processing workers, electrical technicians, clarification station workers, processing foremen, and the RSPO Officer). There are an attendance list, photographs of the vent, and training material available.

Reports of occupational accidents at PT. TN and PT. BAS use the Accident Investigation Report (FP 01/SMK3-SOP-10). There is the 2012 recapitulation of the annual occupational accidents for FR and SR. a. At Semilar Mill there was accident :one case in April and one case in October 2012. b. At Semilar Estate in 2012, in January there were accidents : one case in February , one case in March, three case in April , two

case in June, two case in July , one case in August, and two case in September. c. At Mandang Estate the recapitulation of occupational accidents between January and October 2012 was: January 1 case,

February 3 cases, April 1 case, July 1 case, August 1 case, September 1 case, and November 2 cases. d. Accident reports are also recapitulated every 3 months by the Guiding Committee of Occupational Safety and Health. There are occupational accident reports (1X24 hours), for example for the accident at SMLM on 22 October 2012, Report Number 003/LKK-P2K3/SMLM/10/2012. An employee had a burn on the left leg because the employee did not have a good understanding of the working situation and location (the water had over flown in the condensate pit, making it difficult to locate the ditch), and the job status (the ditch was still open). Follow-up recommendation:

1. Employees must use safe working appropriate equipment with job specifications. 2. The foremen and Assistants should monitor the use of Personal Protective Equipment. 3. The Assistant and foremen should disseminate Workshop SOP and safe working procedures. 4. Making lid for the condensate pit. 5. Making warning sign for hot liquids. 6. The occupational accident should be explained during the briefing

Actions had been taken: 1. Two warning signs for hot liquids have been posted at the clarification station on 31 October 2012 (the documents for the

posting of the signs and some photographs of the signs are available). 2. A lid for the condensate pit ditch has been made on 29 October 2012 (the documents of the ditch covering and photographs

are available). 3. Socialization to all processing employees, maintenance employees, laboratory and grading employees, office employees,

security guards, and all SMLM staff about usage of Personal Protective Equipment, the accident had happened in the condensate pit ditch, and the SOP for safe working procedures.


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

There are employee general training programs for the January – December 2012 period. Informed the type of training, institution or


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location of training, duration of training, and the month. There is also identification of training needs year 2013, explained the positions and the type of training. For example: fire simulation training is needed by all employees. At MNAE it will plan in May 2013 and November 2013 and at SMLE in November 2013. Lifting and transporting equipment operators and heavy equipment operators‟ training will plan in July 2013 at MNAE, in June 2013 at SMLE, and in September 2013 at SMLF. The documentation of the training for each employee kept in Personal Files, Number 17, containing their ppreciation certificates and training certificates. For example, in Mr. Untung‟s file (a spraying worker), he had participated in pesticide training, certificate number 090/748.30/UM/Disbun/2011 and there is a certificate for an introduction of Occupational Safety and Health for employees on 27 February 2012. There are also documentations of trainings:

- Socialization of SOP, Job Instructions, Job Descriptions, Complaints, and RSPO conducted in July- August 2012 by the SPO Officer and was attended by mill employees.

- Socialization of Spraying and Washing Job Instructions for all sprayer workers at MNAE Pondok 2 (Division 3) on 6 November 2012 attended by 7 employees; on 30 October 2012 at MNAE Pondok 3 (Division 5 and 6) attended by 15 employees (there are an attendance list and photographs of the event available).

- SCCS conducted on 27 November 2012 attended by 22 employees (the RC KT 3, the SPO PSM 6 coordinator, the SPO Officer, the Estate Manager, the Mill Manager, the Head of the Administration Office, and the Askep). The trainer was Aprillianto HN (Certification Section JKTO) Region KT3.

- ISCC awareness building and requirement conducted on 25 April 2012 attended by the VPA, the RC KT 3, the SPO PSM 6 coordinator, the SPO Officer, the Estate Manager, the Mill Manager, the Head of the Administration Office, and the Askep. The trainer was Hendi Hidayat.

- GHG awareness conducted on 24-27 April 2012 attended by the SPO PSM 6 coordinator, the SPO Officer, the Estate Manager, the Mill Manager, the Head of the Administration Office, and the Askep. The trainer is Baby Fitria Nurainny (Environtment Dept. – Suistainability Div.)

- training Records in 2012 are First Aid training conducted on 22 January 2013 at the SMLM Meeting Room by Dr. IBGR Mahendra D., attended by 16 employees (laboratory analysts, grading workers, foremen, security guards, mechanics, processing workers, electrical technicians, clarification station workers, processing foremen, and the RSPO Officer). There are an attendance list, photographs of the event, and the training material.

Proof that the company uses trained contractors: There is the Working Contract number 005/TN/08/11 with Gatot Hismadi Gondo Margono CV. Bina Perkasa which located in West Kotawaringin as the transporter for shipping CPO from Semilar Mill to Bagendang Bulking owned by PT. Binasawit Abadipratama. The contract is valid from 26 August 2011 to 15 August 2013. In Article 6 point 4, the vehicle registration and driver‟s license such as the Vehicle Ownership Certificates, Vehicle License Plate Certificates (STNK), Driver‟s License (SIM), First Aid kits must be presented and available for all vehicles used.


PRINCIPLE #5 Environmental responsibility and conservation of natural resources and biodiversity

5.1 Aspects of plantation and mill management, including replanting, that have environmental impacts are identified, and plans to negative impacts and promote the positive ones are made, implemented and monitored, to demonstrate continuous improvement.

From the document review are known that all impact analysis documents for PT. TN and PT. BAS are available. The Environmental Impact Assessment documents for PT. TN (previously: PT. Mitratama Abadi Makmur) were compiled in 2006 and have been authorized by the Governor of Central Kalimantan on 18 January 2006 for an area of 9,300 hectares and a 90 ton/hour capacity mill.


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The Environmental Impact Assessment documents for PT. Buana Artha Sejahtera (PT. BAS) were compiled in 2005 and have been authorized by the Governor of Central Kalimantan on 23 January 2006 for an Environmental Impact Assessment area of +14,300 hectares and a 90 ton/hour capacity mill. For environmental management and monitoring, PT. TN and PT. BAS have regularly assembled and reported their environmental management and monitoring to related government agencies in the form of Environmental Management Plan/Environmental Monitoring Plan Implementation Reports (RKL/RPL) every six months, Hazardous Waste Material Management Reports every three months, Reports of Implementation Land Application Analysis in Semilar POM every six months. Based on observation at the estate and Semilar Mill, there have been found no changes in the operational area or mill production capacity so there is no need revisions of the current environmental documents.


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

PT. TN and PT. BAS have identified rare, endangered, or nearly extinct species and High Conservation Value habitats. Identification and the formulation of management plans conducted by the company‟s internal HCV team in 2011 and were concluded in October 2012 . The results have peer review by independent consultants assigned by the company. Public consultation has been conducted on October 19, 2012 at Sungai Rungai Training Center (SRTZ), attended by 30 participants (Company representation, communities representation, head of villages, head of sub districts and the relevant agencies. The HCV areas identified within PT. Tapian Nadenggan‟s land is 244.98 hectares (HCV 1, 2 and 4) in the form or riparian areas whereas the HCV areas identified on PT. BAS are HCV 1, 2 and 4 in the form of riparian areas covering 497.23 hectares. The protected spesies which have been identified are the white-throated kingfisher, the sunbird, the little spider-hunter, the monitor lizard, the cobra, the Asian black hornbill, the Indian black eagle, the hornbill, kingfishers, the stork-billed kingfisher, the pied fantail, the orang utan, the maroon leaf monkey, and the bear. In order to protect the wildlife and HCV areas, several steps have been taken in accordance to HCV management recommendations, i.e.: the construction of warning signs, the re-vegetation of riparian areas, patrolling, external and internal dissemination, the formulation of an HCV Management SOP, and the active collaboration with NGOs in managing wildlife habitats, especially orangutan. In general, the actions are in accordance to the regulations and have included measures to control all hunting, fishing, or illegal and inappropriate harvesting. The socialization of HCV area are construction of warning signs, signs prohibiting of agrochemicals application in riparian areas, and signs depicting protected wildlife species, the printing of posters, calendars, and leaflets (brochures) informing to the people within and around the company about protected wildlife species, and routine internal socialization. In order to manage and monitor the HCV areas in PT. TN and PT. BAS, the company has appointed officers , for each estate assisted by one foreman. Besides the field officers, there is a Head Office structure to help manage and monitor HCVs at field.


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

The efforts have been done by the company to reduce and recycle waste such as: 1) The company have SOP Environmental Aspect and Occupational Safety and Health Identification (SOP/SPO/SMART/LH-11).

explained identification methode.


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2) The company have SOP Waste Management (SOP/SPO/SMART/LH-9). explains the categorizing of wastes produced of estate and mill operational activities.

3) Based on the SOPs mentioned above, the company has compiled an environmental aspect document which contains information about codifying waste aspects, environmental aspects, potential impacts, related areas, related procedures, and the management plan. The identification conducted in every unit both the estate and the mill.

Based on identification results of waste sources, the company has planned waste management according to the type of waste and characteristics of the waste produced. For example:

Activity Unit Environmental Aspect Potential Impact Management Plan

Weed spraying - Drops/spills of the herbicide from the sprayer

- Used herbicide containers

Water pollution - Maintenance (service) for broken knaps and weekly calibrations.

- Washed three times at a special place, marked, collected, damaged, and returned to the supplier.

Based on the Hazardous Waste Management Procedure (SOP/SPO/SMART/LH-18), it known that the hazardous waste produced in estate and mill activities are used motor oil, used batteries, hazardous material-contaminated rags, used oil filters, and used neon light bulbs. Hazardous waste is collected at the hazardous waste warehouse at the estate and mill. Used motor oil and other hazardous waste are sent to licensed collectors when it has reached the maximum storage duration which is 90 days. There are Hazardous Waste Temporary Storage Permits at the estate and the mill, i.e.:

1. PT. Tapian Nadenggan (Semilar Mill and Semilar Estate) by the decree of Seruyan‟s Head of District number 296 year 2012 about Permit for Hazardous Waste Temporary Storage to PT. Tapian Nadenggan dated 04 June 2012 and valid for 5 years. The types of hazardous material that are permitted to be stored are used lubricants/motor oil, used batteries, filters, used diesel fuel, and used grease traps. The storage area that have permit is Semilar Mill covering an area of 6.2 m x 6.1 m x 3.75 m which is located at the coordinates of S: 20 15‟ 00.96” and E: 1120 20‟ 29.86”, and at Semilar Estate covering an area of 6 m x 3 m x 2.5 m which is located at the coordinates S: 20 15‟ 08.30” and E: 1120 21‟ 01.20”

2. PT. Buana Artha Sejahtera by the decree of Seruyan‟s Head of District number 286 year 2012 about Hazardous Waste Temporary Storage to PT. Buana Artha Sejahtera dated 30 May 2012 and valid for 5 years. The storage area based on the permit is at the coordinates of S: 20 16‟ 26.52” and E: 1120 20‟ 14.07” covering an area of 6 m x 3 m x 2.5 m. The types of hazardous material are permitted to be stored are used lubricants/motor oil, used batteries, filters, used diesel fuel, and used grease traps.

After the storage, the next management step is collaborating with a third party (PT. Nazar). The waste transported and collected by the licensed third party. The company shown documents of .

- Permit for Transporting Special Goods for Hazardous Materials number AJ.309/ 77/005 /DJPD/2012/63001002 issued by the Directorate General of Land Transportation , the Ministry of Transportation. This permit was issued based on the Letter from the Ministry of Environment of the Republic of Indonesia number 84360/DEP.IV/LH/PDAL/512 dated 10 May 2012 about Recommendation for the Transport of Hazardous Materials. The permit is valid from 29 January 2013 to 29 July 2013. The types of hazardous waste that are permitted to be transported are used motor oil, dirty oil, used oil filters, used grease, used gloves, and hazardous waste-contaminated rags.

- Permit for collecting hazardous waste issued to PT. Nazar by the Decree of the Ministry of Environment number 122 year 2010 pertaining to PT. Nazar‟s Permit for Collecting Hazardous Waste. This permit is valid for five years starting 15 June 2010.

Medical waste is divided into 2 categories, sharp medical waste (used hypodermic needles, used ampoules) and unsharp medical waste (soiled cotton/gauze, expired drugs). Medical waste from each branch‟s polyclinic is sent to the central polyclinic. Based on the observation to the Polyclinic, there were found covered waste bins for sharp medical waste and medical waste that is not sharp. For the elimination of medical waste, the company collaborates with the Murjani Hospital in Sampit. The contract number is 400/TU-


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2/002.7/Dm/2012 which is valid from 2 April 2012 to 30 March 2013. There are records for the monitoring/analysis at Mandang Estate and Semilar Estate. The records were stored in the hazardous waste monitoring document, for example:

a. A shipment of soiled rags (20 kg), filters (37 units), and used motor oil (800 liters) on 29 November 2012. b. A shipment of used motor oil (2,400 liters), solid waste (40 kg), and used batteries (3 units) on 13 September 2012. c. A shipment of used motor oil (1,500 liters), solid waste (25 kg), and used batteries (1 unit) on 17 July 2012. d. A shipment of used motor oil (1,800 liters), solid waste (133 kg), and used batteries (6 units) on 2 June 2012. e. A shipment of used motor oil (3,600 liters) and solid waste (150 kg) on 5 April 2012. f. A shipment of used motor oil (2,800 liters), solid waste (100 kg), and used batteries (8 units) on 10 January 2012.

Monitoring empty pesticide containers, the company has recorded waste management in the Pesticide Container Log Book. After the empty containers are washed and stored for a period of time, the company returns them to the supplier. There is a receipt for the returning of the empty containers on 06 November 2012. On this date, 139 used Roll up containers, 143 used Rolixone containers, and 759 used Erkafuron containers were sent back to PT Rolimex. According to the regulations in Indonesia, the company submit the monitoring reports every three months to related agencies (the local Environmental Bodies) to ensure the management of waste materials complies to the laws. Based on the document review, the company have receipts for report submission to the related agencies for the first three months (January – March 2012), second three months (April – June 2012), third three months (July – September 2012), and fourth three months (October – December 2012).


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

The document review shown that PT. TN have monitoring record of renewable energy source from fiber and shell as boiler fuel. The monitoring recorded monthly and recapitulated yearly for the efficiency analysis. The 2010 efficiency was 272.34 calories/ton CPO, 2011 was 264 calories/ton CPO, and for 2012 was 269 calories/ton CPO. PT. TN has also conducted regular monitoring of the diesel fuel usage in the estate and mill. Then it made diesel fuel usage trend analyses compared to the FFB/CPO production. It shown increasing trend for the estate and decreasing trend for the mill. The decreasing ratio at the mill because there is repairs two boilers in March, April, and May 2012, it made the energy supply from the boiler decrease and the need for diesel fuel for generator set increase and also increasing electricity demand for non-mill activities, especially to the housing complex, in the years 2011 and 2012.


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

According to the Sinar Mas Oil Palm Cultivation Technical Guide (Agronomy and Research Management Committee) Point 5 about land clearing and planting, document number SMA/MCAR/05/05-07, land clearing conducted by Zero Burning principle. The planting of the land both in PT. Tapian Nadenggan and PT. Buana Artha Sejahtera in 2007 and 2008 implemented zero burning principle. It is proven through job contracts between the companies and the contractors which had conducted the land clearing. The land was cleared mechanically. For example:

a. The job to construct excavator stacking at Blocks M48, M49, and M54 covering an area of 15.15 ha between 1 and 15 July 2007.


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b. The job to construct excavator stacking at Blocks M 46 and L53 covering an area of 3.64 ha between 1 and 15 April 2007. c. The job to construct excavator stacking on an area of 14.73 ha between 16 and 30 April 2007. d. The job to construct excavator stacking on an area of 20.844 ha between 1 and 15 February 2007.

There is a procedure for brush fire control, document number SOP/NP/SMART/XI/LH002 authorized on 1 July 2010. The SOP explains the occurrence of fire, the parts oF fire, the land fires, the duty and responsibility of the fire control unit, and steps of fire prevention work such as identification of a fire hazard, the procedure for extinguishing fire, the fire control equipment, and post-fire activities. There are Fire Emergency Teams in each working unit both the estate and the mill. The company has conducted land fire simulation on 29 May 2012 at Pondok 2 SMLE Block A65, attended by the RC/PC, Estate Unit Heads, the SPO PIC and the AK3, the SPO Coordinator, and the unit Region KT 2 Emergency Response Team. This simulation was a joint simulation between Region KT 2 and Region KT 3, i.e. PT. Tapian Nadenggan (Semilar Estate) and PT. Buana Artha Sejahtera (Mandang Estate). The company has also conducted training of fire extinguishers utilization on 26 November 2012 held at SMLE KT3 sports center in collaboration with the supplier, Jaya Mandiri, and the Sampit Fire Brigade and was attended by 33 employees. PT. TN and PT. BAS have identified land fire control facilities and equipment. For example,

- at Semilar Estate the equipment for fire control are 34 powder fire extinguishers, water tanks, water pumps, hoses, knapsacks, fire beaters, fire blankets, sand barrels and sand, shovels, machetes, hook poles, an alarm or bell, a stretcher, and First Aid kit.

- At Mandang Estate, there are 31 powder fire extinguishers, buckets, fire blankets, flappers, shovels, axes, fire hoses, hoes, petroleum, hook poles, sand, water tanks, robin machines, machetes, nozzles, and knapsacks which are placed at the housing complex Fire Brigade Station at Pondok 1, 2, and 3.

Based on observation in Semilar Estate‟s central warehouse complex, it was found that land fire facilities and equipment are available at one location and function well. The company has also identified the water sources that are available within the company‟s operational area, for example:

- There is a Water Reserve and Fire-Prone Area Map at SMLE. On the map informed the location of water sources and areas which are prone to fire hazards. There are 6 water sources at SMLE (K-54, J-52, I-52, I-53, I-58, and I-69). The water comes from reservoirs and ponds.

- There is a Fire-Prone Area &Water Source Map. On this map informed location of water sources and areas which are prone to fire hazards. There are 6 water sources at MNAE (L-44, K-45, I-44, H-32, K-40, and M-44). The water comes from rivers and reservoirs.


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

In order to reduce emission, PT. TN and PT. BAS have identified the sources of pollution and emission at Semilar Mill which are recorded in PT. Tapian Nadenggan‟s Environmental Aspect List document. The document explains the environmental aspect, the potential impact, the related division/PIC, the related procedures (SOP), and managerial steps needed for the environmental aspects. The next step, the company monitors the mill‟s exhaust emission every six months which consists of ambient air quality, boiler emission, and generator set emission. The results of the ambient air quality of the mill and the housing complex do not exceed the Government Regulation number 41 year 1999 threshold and also the Mill has smoke density meter equipment. However, based on the environmental management document review and the field check, there were found some potential pollution sources that have not been monitored regularly that is “smell level”. There noncompliance between the field practices and standar of the pollution and emission planning and reduction. Therefore, PT. TN must be able to proof potential pollution, especially smell, has been monitored, specifically in locations where the smell might cause disturbance. (See CAR 2013.01)


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managing and monitoring POME, PT. TN have SOP and consistent to implement. For effluent treatment, there are six anaerobic ponds (each pond is 10,000 m3) which in parallel receives effluent from the sludge pit, then it flowed to the estate for land application.

Minor 5.6.1 Status: See CAR 2013.01 under the category Minor.

PRINCIPLE #6 Responsible consideration of employees and of individuals and communities affected by growers and mills

6.1 Aspects of plantation and mill management, including replanting, that have social impacts are identified in a participatory way, and plans to mitigate the negative impacts and promote the positive ones are made, implemented and monitored, to demonstrate the continuous improvement.

The development of the estates and mills owned by PT Tapian Nadenggan / Mitratama Abadimakmur is based on the analysis of the impact of the activities towards the environment, both the employees and the surrounding communities. Environmental analysis is documented in the Environmental Impact Statement (Andal) document at Danau Sembuluh Sub-district, Seruyan District. The document has received authorization from the Governor of Central Kalimantan number 04a Year 2006 dated 18 January 2006. The mill‟ maximum capacity is 90 tons of FFB/hour. The following documents are: 1. The Social Impact Identification Report for PT Tapian Nadenggan‟s Oil Palm Estate (Danau Seluluk Sub-district, Seruyan District,

Central Kalimantan Province Year 2012, containing of: - The attendance list for the Social Impact Assessment held on 8 -1- 2011 at Panteb Village and photographs - The attendance list for the Public Consultation for PT. TN & PT. BAS‟s Social Impact Assessment, HCV, and Environmental

Impact Assessment held on 19 October 2012 - The minutes of the meeting for the Public Consultation for PT. TN & PT. BAS‟s Social Impact Assessment held on 19 October

2012 - The Conclusion and Recommendations from the Public Consultation for PT. TN & PT. BAS‟s Social Impact Assessment held on

19 October 2012 - Photographs of the Public Consultation for PT. TN & PT. BAS‟s Social Impact Assessment held on 19 October 2012

2. The Social Impact Identification Study Report for PT Buana Artha Sejahtera‟s Oil Palm Estate (Danau Seluluk Sub-district,

Seruyan District, Central Kalimantan Province Year 2012. containing of: - The attendance list for the Social Impact Assessment held on 8 -1- 2011 at Panteb Village and photographs - The attendance list for the Public Consultation for PT. TN & PT. BAS‟s Social Impact Assessment, HCV, and Environmental

Impact Assessment held on 19 October 2012 - The minutes of the meeting for the Public Consultation for PT. TN & PT. BAS‟s Social Impact Assessment held on 19 October

2012 - The Conclusion and Recommendations from the Public Consultation for PT. TN & PT. BAS‟s Social Impact Assessment held on

19 October 2012 - Photographs of the Public Consultation for PT. TN & PT. BAS‟s Social Impact Assessment held on 19 October 2012


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


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There is a Communication and Consultation with Stakeholders SOP in document number SOP/NP/SMART/XIV/MCAR003 which was assembled on 1 July 2010 and approved by the MCAR Chairman. It informed references, the description of each officer‟s job, and the communication and consultation steps for internal and external communication. In general, information is delivered directly. The communication and consultation with the adjacent community through:

- Incidental meetings that are agreed. - Suggestion boxes are placed in several locations throughout the company. - Sending official letters to the company.

There are also records of the community members‟ aspiration in the Communication and Consultation Book complete with the records of the response and the current status. The data for the last three months are

Month Aspiration Response

September - Notification of the change of the e-KTP (electronic ID Card) schedule

- Proposal from Unpar Students requesting internship opportunities

- Granted an opportunity for internship

October - Proposal from Unpar Students requesting internship opportunities

- A request for financial aid for Hero Day commemoration

- Granted an opportunity for internship - Granted financial aid

The company also assigns officers to communicate and consultations with the community: 1. Mandang Estate: Mr. Hendriaga Utama (Estate Manager) based on RC Kalteng 3‟s decree number 03/RC-RSPO/03/2011 dated

1 March 2011. 2. Semilar Estate: Mr. Supriadi (Estate Manager) based on RC Kalteng 3 „s decree number 01/RC-RSPO/03/2011 dated 1 March

2011. 3. Puri Estate: Mr. Ahmad Tarmizi (Estate Manager) based on RC Kalteng 3‟s decree number 04/RC-RSPO/03/2011 dated 1 March

2011. 4. Serindu Estate: Mr. Ngasup Tarigan (Estate Manager) based on RC Kalteng 3‟s decree number 02/RC-RSPO/03/2011 dated 1

March 2011.


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

The company have SOP Complaint and Grievance Handling for internal and external parties (SOP/NP/SMART/XII/MCAR001) dated 1 July 2010 and it was socialized to stakeholders on 3 July 2010.Company also have mechanism to resolve land conflicts, document number SOP/SPO/SMART/LH-04 dated 1 July 2010 which was authorized by the central management, the Environtment & Sustainability Division. The socialization in 2 villages around PT TN, Tangar and Rungau Raya Villages about mechanisms for complaints and conflict resolve. For example, records for the socialization in Rungau Raya Village on 28 September 2011, there are an attendance list, minutes of the meeting, photographs, the dissemination assignment letter, and the dissemination materials. The socialization in 3 villages around PT BAS, Sumber Makmur, Seibabi, and Biru Maju Villages. The socialization included the mechanisms for complaints and conflict resolve. For example, records of socialization in Sei Babi and Sumber Makmur Villages on 28 September 2011 (simultaneously) such as attendance list, minutes of the meeting, photographs, socialization assignment letter, and socialization materials. For internal parties (employees), socialization conducted simultaneously on 4 October 2011 at all Pondok (housing complexes) in PT. TN and PT. BAS. The complete records at PT. TN including such as attendance lists, minutes of the meeting, photographs, and dissemination materials were produced. Records for complaint handling at PT. TN and PT. BAS are documented in the form of:


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- The Communication and Consultation Book which contains complaints/information received, the responsed, and the current status from the external party. In general, there have been no official complaints received, mostly information are financial aid proposals, notifications, or requests for aid.

- Monitoring of complaint and grievance handling until November 2012 shown there no complaints from employees.


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

The company have a land compensation procedure, SOP number SOP/NP/SAMRT/VII/D&L002 dated 1 July 2010. In the SOP, explained: the duties and responsibilities, steps of dissemination process, identification, negotiation, the land compensation fee payment, and the documentation of the land compensation fee payment. SOP explained compensation process based on an agreement, consultation, and dialogs involving the local community and government officials (point 6.1 – 6.10 in the SOP). There are also examples of the records of the land compensation process which include: - A land compensation payment receipt which is signed by the recipient, has an official stamp (materai) affixed, and a finger print

(the sample was under the name of Bustami Pasaribu, valued at IDR 2 million juta on 29 November 2006). - A copy of the ID card receiver (the sample under the name of Bustami Pasaribu). - Official documents of the Land Abdication and Compensation Fee Conferral (the sample documents number 03/BAK-

SRDE/XI/2006 under the name of Bustami Pasaribu which were signed by receiver, the company representatives, the Head of Trans Biru Maju Village, and the Head of Kota Besi Sub-district).

- The Cultivated Land Abdication Certificate (the sample certificate number 03/BAK-SRDE/XI/2006 was signed by the concerned parties and was witnessed by the Head of Trans Biru Maju Village and the Head of Kota Besi Sub-district).

- A declaration as the cultivator of the land and a declaration of agreement upon the amount of land compensation payment which was signed by the cultivator and witnessed by the village head (the sample under the name of Bustami Pasaribu for 2,000 hectares of land)

- The official documents/attendance list of the measuring of compensated land which were signed by the land owner, head of village, and the company‟s measurement officer.

- Documentation of the land ownership from the Village.


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

There is wages list which explains the payment system based on the Regional Minimum Pay, i.e.: 1. Based on the wages list. The wages complies to the Governor‟s Regulation number 27 Year 2012 about Seruyan District‟s 2013

District Minimum Pay and District Sectoral Minimum Pay for the Plantation and Industrial Forest, IDR 1,697,892. For example, Jayus, on 12 January 2013 was paid IDR 778,000 for 12 work days period of 26 December 2012 to 10 January 2013 (4 work days followed the 2012 payment and 8 work days the 2013 payment). Pay bonus IDR 74,800 and 12 work days for the period of 11 January 2013 to 25 January 2013 the pay given was IDR 815,400 and job bonus IDR 486,000 so the total payment IDR 2,079,400. Another example of Employee‟s Pay Based on the Main Pay List is for Wiyanti dated 30 January 2012 with a Main Salary of IDR 1,697,900 and the ASTEK (Asuransi Tenaga Kerja/Labour Insurance) installment IDR 111,043.

2. Based on the wages list in January 2013. For example on behalf of Kowil on 12 January 2013 for 9 work days, working period of 26 December 2012 – 10 January 2013, the pay given was IDR 466,000 (4 work days followed the 2012 Pay and 5 work days the


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2013 pay). Other work bonuses IDR 299,360 and the harvest bonus IDR 144,150. For 10 work days, between 11/01/2013 and 25 January 2013, the pay given was IDR 676.000 and the pay bonus (IDR 46,750) and extra work premium (IDR 422,140) so the total pay received was IDR 2,112,650. An example of Employee‟s Pay Based on the Main Pay List is for Ahmad Jaluli, 25 January 2012, with a Main Salary of IDR 1,689,000 and the ASTEK (Asuransi Tenaga Kerja/Labour Insurance) installment IDR 110,461.

Based on the interview with workers at the estate (sprayer/maintenance workers, harvest workers, and baby-sitters) and at the mill (boiler workers, Water Treatment Plant workers, mechanics), it was discovered that the wages is above the Regional Minimum wages. The company have company regulations for all employees, i.e.:

- PT. Tapian Nadenggan Company Regulations, authorized by the Head of the Labor, Transmigration, and Tourism Agency decree number 560/896/DISNAKERTRANSPAR/V/2012 on 24 May 2012 and valid from 2012 to 2014

- PT. Buana Artha Sejahtera Company Regulations, authorized by the Head of the Labor, Transmigration, and Tourism Agency decree number 560/1083/DISNAKERTRANSPAR/VII/2012 on 16 July 2012 and valid from 2012 to 2014.

- PT. Smart Tbk Company Regulations, authorized by the Director General of Industrial Relationship and Social Assurance Development decree number 1089/PHIJSK-PKKAD/PP/XII/2012 on 11 December 2012 and valid from 1 January 2013 to 31 December 2014.

The company provides emplacement, educational, health, and public facilities, and clean water:

- Semilar Mill, until 30 July 2012, the facilities are 14 units of staff housing, 86 units of G2 housing, 8 units of G1 housing, 1 unit mosque, and 1 unit employee community center. Clean water from the mill‟s water treatment unit is distributed by pipes to each house with 1 water tank (20 m3) at each housing complex.

- Semilar Estate, until of 30 October 2012, the facilities are 22 units of staff housing, 212 units of G2 housing, 20 units of G1 housing, 3 units mosque, 1 unit church, 3 units of Child Care Centers, 3 units of employee community centers, 4 units of soccer fields, 5 units of volley ball courts, 1 unit tennis court, 4 units of badminton courts, 1 unit sports center, 1 unit Central Polyclinic, a kindergarten, elementary school, junior high school, and school bus, each 1 unit, 1 unit smart house (rumah pintar). Clean water from the mill‟s water treatment unit is distributed by pipes to each house with 1 water tank (20 m3) at each housing complex.

- Mandang Estate, until 31 July 2012, the facilities are 20 units of staff housing, 210 units of G2 housing, 20 units of G1 housing, 1 unit polyclinic, 3 units of mosques, a kindergarten, an elementary school, a junior high school, 3 units of BPA, 3 units of employee community centers, 3 units of soccer fields, 4 units of badminton courts, 4 units of volley ball courts, 1 unit tennis court, 1 unit school shuttle vehicle. Clean water from the reservoir at each Pondok is distributed by pipe to every house with 1 water tank (20 m3) at each housing complex. For clean water, there is a well for each cottage and the quality of the water has been tested.

Job contracts requirement contractors to comply labour regulations. For example the Job Contract number 005/TN/08/11 with Gatot Hismadi Gondo Margono CV. Bina Perkasa, West Kotawaringin as the transporter of CPO from Semilar POM to Bagendang Bulking PT. Binasawit Abadipratama. The contract is valid from 26 August 2011 to 15 August 2013. Labour regulations are broached in:

- Article 4 point 9, Jamsostek and Jamsostek premiums for the second party‟s workers (CV. Bina Perkasa) who execute the job must be arranged and paid fully by the second party according to the regulations in effect.

- Article 5 point 8, the second party (CV. Bina Perkasa) declares that it is able to comply to labour regulations, especially related to the minimum age of workers, 18 years, and to the Regional Minimum Pay.

- Article 5 point 9, in fulfilling the duties, the second party assures the safety and health all workers and equip them with appropriate personal protective equipment according to the regulations.


6.6 The employer respects the right of all personnel to form and join trade unions of their choice and to bargain collectively. Where the right to freedom of association and collective bargaining are restricted under law, the employer facilitates parallel means of independent and free association and bargaining for all such personnel.


ASSESSMENT REPORT


The company gives freedom to employees of association and collective bargaining. Based on Memo number 169/HR OPS/08/10 (PT. Tapian Nadenggan) and Memo number 020/HR PSM6/01/11 (PT. Buana Artha Sejahtera) about Freedom to Join Unions authorized by the Director, the company underlines that respects the right and regulations stated in the Law, including the right of all personnel to form and join trade unions. a. Semilar Mill Labour Union

- The Head of the Labor, Transmigration, and Tourism Agency‟s Decree number 560/1062/NAKTRAN/VII/2011 dated 25 July 2011 about PT. Tapian Nadenggan‟s Semilar Mill Unit‟s Estate Labour Union noted the Chairman (Sutikno) and Secretary (Syamsul Fuad). The settled monthly membership fee was IDR 2,000/person.

- There are documentations of the meetings, for example the attendance list for the meeting on 15 May 2012 at Mr. Abdullah‟s residence. There were 62 attendees (Indonesian Workers‟ Union board members and members) and the agenda was discussion about the commemoration of the Republic of Indonesia‟s 67th Independence Day.

b. Semilar Estate Labour Union

- The Head of the Labor, Transmigration, and Tourism Agency‟s decree number 560/1066/NAKTRAN/VII/2011 dated 25 July 2011 about PT. Tapian Nadenggan‟s Semilar Estate‟s Labour Union noted the Chairman (Yamani) and Secretary (Agustinus Philipus). The settled monthly membership fee was IDR 5000/person.

- There are documentations of the meetings, for example the attendance lists for the meeting on 13 March 2012 at SMLE Elementary School attended by 35 people (Indonesian Workers‟ Union board members and members) and in December 2011 at the Semilar Meeting Room attended by 35 people (Indonesian Workers‟ Union board members and members).

c. Mandang Estate

- Seruyan District‟s Head of the Labor, Transmigration, and Tourism Agency‟s decree number 560/1068/NAKTRAN/VII/2011 about PT. Buana Artha Sejahtera‟s Mandang Estate Unit Labour Union was authorized on 25 July 2011. The 2011-2013 board members are: Chairman (Syahriran), Vice Chairman (Khoirun), Secretary 1 (Muzani Hamdan), Secretary 2 (Sigit Pramono), Treasurer 1 (Sugaiyanto), Treasurer 2 (Agung Sussetyo), the religious affairs division, the public relations division, the social and cultural affairs division, the sports division, and the education division. A Labour Union-Company meeting was held on 30 July 2012 at the MNAE Main Office and was attended by 17 people. The meeting on 13 June 2011 at the Division 3 Office was attended by 9 people (Indonesian Workers‟ Union board members and members) and on 09 June 2012 at Mandang Main Office was attended by 6 people (Indonesian Workers‟ Union board members and members).

Based on the interview with the Chairman of the Indonesian Workers‟ Union Mandang Estate, and the Chairman and Secretary of Indonesian Workers‟ Union Semilar Estate, it was found that the Indonesian Workers‟ Union had several meetings both internal and with the company.


6.7 Children are not employed or exploited. Work by children is acceptable on family farms, under adult supervision, and when not interfering with education program. Children are not exposed to hazardous working conditions.

There is Memo number 002/SE-HRDV/03/09 dated 31 March 2009 pertaining to the Minimum Age Requirement which was authorized by the HR Director (Michael Adryanto), starting that the minimum age is 18 years. The data list employee of the Semilar Mill, Semilar Estate and Mandang Estate, updated in January 2013 informed the name, sex, religion, ethnic group, date of birth, date of employment, and position of the employees. Based on the document review, there are no employees who were under the age of 18 when they were employed. The company has also constructed a signboard prohibiting the employment of children under the age of 18 at several locations such as block J35 MNAE.



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

There is a Memo, Reference number 262/HR OPS/08/10, dated 20 August 2010, which was authorized by the director, pertaining to the implementation of the Industrial Relationship in Units. One of the points is the company gives freedom to the employees to work in any field without any discrimination based on ethic group, religion, or gender. Documentation of equal opportunity and treatment in job opportunities are: 1. There are Semilar Mill, Semilar Estate and Mandang Estate‟s employee lists, updated January 2013. Based on the data, the

employees are from various ethnic groups, for example Banjar, Batak, Dayak, Flores, Java, Sasak, Betawi, Melayu, Flores, Bima, Toraja, Sunda, Nias, and Bugis. The religions they believe in are also varied, such as Islam, Christian, and Kaharingan Hinduism. From these documents, it concluded that the company provides equal opportunity to all, regardless of ethnic group and religion.

2. In the recruitment process, the company refers to SOP for Employee (Staff) Recruitment, Procedure Number A-003-00 dated 1 September 2005, authorized by MD Strategic, which explains the procedure for employees recruitment, the application selection, the psychological evaluation, the interview, the payment negotiation, the medical check-up, the employee hiring, the training (6 months) and the positioning. All activities conducted by the HRD according to the needs and working rotations.

3. The determination of SKU employees according to the employee classification and positioning administration of SKU employees, HRD policy number HRD B-012-00 dated 7 October 2000, Senior Managing Director.

4. Staff promotions according to procedure number D008 dated 1 September 2005 which was authorized by MD Strategic and adjusted to the assessments, working duration, and the Monthly SKU job promotion in compliance to the procedures in HRD policy number B-014-00 dated 7 October 2000, Senior Managing Director.


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

There is letter No. 264/HR OPS/08/10 (PT. Tapian Nadenggan) dated 1 August 2010 and No. 056/HR OPS/01/11 dated 3 January 2011 (PT. Buana Artha Sejahtera), both were authorized by the Director, have specified that all Unit Heads and their officials shall conduct the dissemination for all employees regarding the prevention and the handling of sexual harassment issues. The company’s policy on the subject of the protection of reproductive rights is as follow:

1. PT. Tapian Nadenggan: Letter. No. 266/HR OPS/08/10 dated 20 August 2010 was authorized by the Director regarding menstrual period, stated that any female worker, during her menstrual period have menstrual sickness, and verified by the company‟s doctor. They have two-day leave on the first and second day of her menstrual period and pay full. The request must attach recommendation from company‟s doctor. In addition, Letter No. 104/HR PSM6/01/11 dated 3 January 2011 regarding the OHS, Spray Workers is who pregnant and breastfeeding are not allowed to be assigned as sprayer.

2. PT. Buana Artha Sejahtera: Letter No. 046/HR OPS/01/11 dated 3 January 2011 regarding the approval on menstrual leave

which was authorized by the Director, and No. 068/HR OPS/01/11 dated 3 January 2011 regarding OHS for prohibits for spray Workers who pregnant and breastfeeding assigned as spray workers.

The implementations of the policy of sexual harassment prevention were conducted by establishing a Commission for Women / Gender Committee in each working unit of the Mills and Estates as detailed below;

- Commission for Women (Gender Committee) of SMLM, which Chairperson (Misfa Walian/Mrs. Hilmanudin), Deputy Chairperson, Secretary, Treasurer, and Members. The establishment of committee has been socialization to all female employees and their spouses by the HR Ops of the PSM on 23 September 2011 at SMP Binasawit Semilar Estate Lodge 3.


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- Commission for Women (Gender Committee) of SMLE, with the structure consisting of Chairperson (Septia Tri Hartanti), Deputy Chairperson, Treasurer, Secretary, Chaperones, and Members, which was established on 23 September 2011 by the SM of SMLE. The Decree of Assignment No. 01/SMLE/10/2011 was issued as the legal basis for the appointment of the Chairperson of the Gender Committee. The socialization of the sexual harassment was conducted on 2 October 2011 at Lodge 1 Semilar and was attended by the employees of Division 1 and 2.

- Commission for Women (Gender Committee) of MNAE, with the structure consisting of Chairperson (Iriyanti), Deputy Chairperson, Secretary, Treasurer, Educational Division, Spiritual Division, and General Division. The entity was established by the Estate Manager on 1 November 2012, Decree No. 01/EM SRDE/SK-GC/XI/12 which served as the legal basis for the appointment of the Chairperson of the Gender Committee. The socialization of the Gender Committee, prevention and management of social harassment at workplace was conducted on 16 November 2012 at the Auditorium of SDS Mandang and was attended by the members of PRISTI/spouses, the members of commission for women, and the employees.

- PRISTI (the Organization of the Staff‟s Wives of Central Kalimantan 3), which is chaired by Mrs. Hidayati. The meetings was held by Women Commission on 27 January 2013 in MNAE with the topic of the socialization on Women Commission‟s programs from cottage 1, 2 and 3. The programs were prepared by Women Commission are,;

- Providing early learning facilities at the Day Care Center

- Conducting a weekly spiritual activity.

- Providing a number of integrated health posts.

- Initiating a “clean Friday” event. The meeting was attended by 7 official board members and 54 regular members of the Women Commission. In addition, there was also an event held in Mandang Estate on 16 November 2012, which focused on the socialization of Sexual Harassment Prevention. Every estate was taking turns in holding the meeting on the second Tuesday every month. As for the event commemorating Kartini‟s Day, it was organized by the PRISTI. The followings are the evidence of the implementation of the policy of reproductive rights protection;

- SMLM: there are two medical reference letters issued by Central Polyclinic‟s doctor; the first is H1 (menstrual leave) dated 26 November 2012, for the name of Yulinda P, in which it was stated that she was allowed to take two-day leave (26 – 27 November 2012). The second letter is H2 (maternity leave), under the name of Dewi Purnama Sari, holding a cashier position, she was entitled to 3-month paid leave, from 2 April 2012 to 3 July 2012. The salary/wages for both on-leave workers were still paid, as seen on the list of attendance and the list of main salary.

- SMLE: there is a medical reference letter issued for Yulianti Sri R, a Rumpin Tutor, dated 15 October 2012, which stated that she was entitled maternity leave from 16 October 2012 to 15 January 2013. As seen on the attendance list and on the main salary list, the person was still given the full basic salary during her leave.

- MNAE: there is a medical reference letter issued by MNAE clinic on 2 November 2012 for Baniyah (loose fruit collector), which stated that she was given H1 status and allowed to take H1 leave permit for 2 days (2 – 3 November 2012). Moreover, the attendance list also indicated similar remark, as well as the confirmed procedure specifying that she still receive full wages payment.

The mechanism for handling the sexual harassment as follow:

1. In the event that a sexual harassment take place, the victim shall go to PRISTI (the Organization of the Staff‟s Wives of Central Kalimantan 3) or to any official member of the Female Workers Committee to file the report, either orally or in written form.

2. PRISTI and the officials of Female Workers Committee shall work closely in providing assistance to the victim when filing the


ASSESSMENT REPORT


report to the unit leader. 3. The unit head shall take necessary action in gathering proofs based on the available information and data. 4. Sanctions will be imposed on the offender when proven guilty, both in accordance with the Company‟s Regulation and

through legal means. The Handling of Complaints and Grievance Form, in the document No. SOP/NP/SMART/XII/MCAR001 which was authorized by the Chairperson of MCAR (Management Committee Agronomy Research) on 1 July 2010, as the following procedure:

- Internally the settlement for such case of complaints and grievance that comes from the employee must be conveyed through the Head of Work Unit – Workers Union (PUK – SP).

- Externally the Unit keeps the complaints and grievance filed by external parties, both oral and written, which were equipped with ID information. Then it verified by unit head and department staff and they will response it maximum one-month as per the date of the grievance and complaints are filed and received.

Based on Complaints and Grievance Forms at SMLM, SMLE, and MNAE, so far there no report being filed. Based on interviews with the Chairmen of Indonesian Labour Union (SPSI) of SMLM, SMLE, and MNAE respectively; with the Chairmen of Gender Committee of SMLE and MNAE respectively; as well as with the Chairperson of PRISTI Sinarmas, have confirmed that no such complaints nor grievance have been filed.


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

Regarding the cooperation between the company and the farmers, it was revealed during the interview with the Mill Manager of Semilar POM , the company did not accept fruits from the farmers. As for the cooperation with other local business entities, the company able to present that all involved parties have been fully aware and understood the contract agreement. The signatures put on the stamp in the agreement as physical evidence that both parties have agreed upon the type of specified works, by considering the justice, legality, transparency, and putting the occupational health and safety as priority. For example: there is a document of Mutual Working Agreement that signed by both parties, the company and fruit dispatch contractor (Hasan Basri) No. SPK: 004/MNAE/LKL/07/12-ATBS. The payment method was agreed and there is a payment receipt serving as evidence. For example In Article 4 of the MWA cooperation with Hasan Basri (fruit dispatch contractor), document No. SPK: 004/MNAE/LKL/07/12-ATBS, it is described about the price and the payment method no later than the 10th day of the month. There is a payment receipt made for FFBs dispatch contractor with the name of Mr. Hasan Basri dated 3 August 2012.


6.11 Growers and millers contribute to local sustainable development wherever appropriate.

The contributions to local development were presented in several records. The followings are those of CD/CSR programs in 2013, such as 1. CSR programs set up in SMLE and SMLM units for Rungau Jaya development, which included activities for

- Education support (providing two additional locals for Primary Level (SD), school buses, and school uniforms and bags), - Health issues (nutrition improvement programs for the elderly and children) - Economy (establishment of a number of produce stands at the market)


ASSESSMENT REPORT


- Social affairs (supports in providing arts devices) - Infrastructure (constructing several watch-posts for community-based security system (siskamling) at Rungau Jaya

Village).

2. There is MNAE Program Plan for 2013 for Sumber Makmur Village, which included 10 activities as follow: - Reconstruction of secondary school buildings, - Providing the teaching props and toys for kindergarten, - Improvements of community health center (Puskesmas), - Fogging activity (the spraying method to exterminate the vector of dengue fever – Aedes aegypti mosquitos), - Sewing training given to the members of PKK (Family Welfare Movement), - Dispatch and transport program for FFBs (local dispatcher contractor), - Incidental market fair, providing low-priced cooking oil, - Village roads repair, - Building rehabilitation for one musholla (small prayer house for Muslims), - Assistance in providing facilities for church.

3. Payment of levy taxes, such as:

Payment of vehicle ownership tax for Mandang Estate, e.g.: motorcycle tax VIAR/VR 150 BR on 4 November 2012.

Tax payment for surface water usage in compliance with the Letter of Recapitulation from The City Revenue Agency (Dispenda) No. 973/184/III/UPTPPD/SRY/2012, which was done on 18 October 2012 (payment receipt no. 011331, signed by the City Revenue Agency (Dispenda) Treasurer).

There is a Tax Payment Form for Land and Building (SSP PBB) under Tax Object No. (621006000500000051), which was paid via BRI Bank Sampit Branch on 5 August 2011.

4. The budget for CSR program has been approved in the CSR Budget 2013 No. 70110220. 5. There is records implementation of CSR programs period 2011 – 2012, e.g.:

- Petrol fuel supports given for official operational car used by the Head of Subdictrict (5 May 2012); Operational Budget/Fund for the Danau Seluluk Subdistrict Official Chapter of IPSI (The Indonesian Pencak Silat Association) on 11 May 2012, attach with photos

- Assistance in lending Grader for road repairs in Sumber Makmur Village on 10 August 2012. The activity took two days (9 – 10 August 2012) and attach minutes of meeting signed by the Manager of Mandang Estate and the Head of Sumber Makmur Village. .


PRINCIPLE #7 Responsible Development of New Plantings

7.1 A comprehensive and participatory independent social and environmental assessment is undertaken prior to establishing new plantings or operations, or expanding existing ones, and the results incorporated into planning, management and operations.

Based on documents review shown that there are lands within the areas of PT. TN which were cultivated after 2005, such as in Block N of Mandang Estate and in Pure estate. The cultivated areas are included in the permitted areas and EIA study (not of expansion), so the environmental document used is EIA document that refers to the criteria 5.1 above. In accordance with the description in criteria 5.2, PT. TN and PT. BAS have prepared and submitted the reports of the environmental management and monitoring on regular basis to relevant institution (local Environment Bodies), in the form of the RKL/RPL.


ASSESSMENT REPORT


Based on document review indicated that PT. TN and PT. BAS did not have a plasma scheme and not imposed to the plasma obligation, since the first plantation was established before 2007.


7.2 Soil surveys and topographic information are used for site planning in the establishment of new plantings, and the results are incorporated into plans and operations.

During the documents review, PT. TN and PT. BAS were able to present the land suitability maps for each estate Soil Maps from the Semi-detailed Soil Survey conducted on 11 – 17 November 2008. The maps have scale 1: 50,000 and containing information on soil map unit, soil classification, texture, depth, drainage, limiting/bordering factors, rocks, and suitability information for the expansion of oil palm plantation. PT. TN and PT. BAS have record of estate expansion, based on the available suitability land by map scale 1: 25,000 scale and contains information on the name of blocks and the year of area‟s clearance. Further description on the land suitability is available in criteria 7.2.1.


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

The environmental document shown that the land clearing have not replaced primary forest since November 2005. The evidence presented is the EIA document of PT. TN which was prepared in 2006 and PT. BAS in 2005. The document stated that the cultivated area are secondary forest cover. The document supported are land cover images taken from 2004 Landsat 7 TM+ (Thematic Mapper Plus) which displayed the forest cover are secondary forest. In addition, the map of land clearing plans and realizations at PT. TN and PT. BAS presented that the land clearing did not replace HCV areas. For HCV areas that were found to be cultivated, company take specific policy which prohibited the use of chemicals on the riparian, and instead required the soil enrichment with hard crop trees and manual care. This policy was reinforced by the Decree of Vice President Agronomy No. 07/VPA-RSPO/03/2010. The HCV areas identified within PT. Tapian Nadenggan‟s land is 244.98 hectares (HCV 1, 2 and 4) in the form or riparian areas whereas the HCV areas identified on PT. BAS are HCV 1, 2 and 4 in the form of riparian areas covering 497.23 hectares. The protected spesies which have been identified are the white-throated kingfisher, the sunbird, the little spider-hunter, the monitor lizard, the cobra, the Asian black hornbill, the Indian black eagle, the hornbill, kingfishers, the stork-billed kingfisher, the pied fantail, the orang utan, the maroon leaf monkey, and the bear. Based on review of reports and maps the HCV identification has overlay with a map of the block plant in and field visits in Mandang Estate did not find of new plantings since November 2005 in the area of HCV.


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

Based on the map of planting year showed Puri Estate (PT Buana Artha Sejahtera) has the youngest planting year of 2007 and 2008 so company should ensure land clearing is not in an area with marginal land conditions (slope of more than 40%, prone to landslides


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etc.). Based on interview with one of the PM & P (Plantation Monitoring and Planning) staff explained that the category of marginal land are the soil texture from loamy sand until sand and heavy clay, the drainage from fair to bad rate, the slope ≥ 40%. Land Map of Semi Detailed Survey (LSC) of Puri estate-PT. Buana Artha Sejahtera have scale of 1:50,000 presented as follows:

Texture Slope Drainage Area

Hectare %

Loam-sandy clay 0-9 Good 1,755.53 48.2

Sandy loam – sandy clayey loam 0-9 Good 1,264.34 24.8

Sand 0-9 Fast (Bad) 73.27 2

Loamy sand– dusty loam 0-3 Fair 545.28 15

The data above showed that the Puri Estate‟s area of planting year of 2007 and 2008 is categorized in loam to sandy clay texture with a slope of 0-9% and good drainage rate. So, the planting area is not located in an area with steep slopes, the soil condition is not prone to landslides and the drainage condition is good (not a marginal land area). There is also an area of planting year of 2007 in Sei Rindu Estate covering 290.16 hectares and available of Sei Rindu Estate‟s Land Map of Semi Detailed Survey with a scale of 1:50,000. The soil analysis shown that the area of the planting year of 2007 is located in an area categorized in sandy clayey loam to dusty clay texture with a slope of 0-9% and good drainage rate.


7.5 No new plantings are established on local peoples’ land without their free, prior and informed consent, dealt with through a documented system that enables indigenous peoples, local communities and other stakeholders to express their views through their own representative institutions.

There was no new planting establishment within the area of PT. Tapian Nadenggan and PT. Buana Artha Sejahtera. There are several samples of the records of dissemination for land compensation offered to the surrounding community in 2007 in Mandang Estate. Prior to starting the compensation process, an agreement had been reached stating that the community had agreed to release the ownership of land to PT Buana Artha Sejahtera. The following list if the recipients of the land compensation as follow

a. Anang Basrin, for the release of land ownership rights covering an area of 7.32 ha. b. Jalmas, for the release of land ownership rights covering an area of 1.183 ha. c. Anang Basrin, for the release of land ownership rights covering an area of 1.257 ha. d. Akhmat Sarminto, for the release of land ownership rights covering an area of 1.192 ha. e. Darlan, for the release of land ownership rights covering an area of 1.519 ha. f. Rambli, for the release of land ownership rights covering an area of 1.434 ha. g. Yeyen, for the release of land ownership rights covering an area of 1.666 ha. h. Norma, for the release of land ownership rights covering an area of 1.118 ha.


7.6 Local people are compensated for any agreed land acquisitions and relinquishment of rights, subject to their free, prior and informed consent and negotiated agreements.

There is sample document of process and compensation claims to community in Mandang Estate, covering an area of 135 ha, in which the local people have agreed to release the ownership of land to PT Buana Artha Sejahtera. The following list identifies the recipients of such land compensation payment:

a. Anang Basrin, for the release of land ownership rights covering an area of 7.32 ha. b. Jalmas, for the release of land ownership rights covering an area of 1.183 ha.


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c. Anang Basrin, for the release of land ownership rights covering an area of 1.257 ha. d. Akhmat Sarminto, for the release of land ownership rights covering an area of 1.192 ha. e. Darlan, for the release of land ownership rights covering an area of 1.519 ha. f. Rambli, for the release of land ownership rights covering an area of 1.434 ha. g. Yeyen, for the release of land ownership rights covering an area of 1.666 ha. h. Norma, for the release of land ownership rights covering an area of 1.118 ha.


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

For new planting established in 2007 at Mandang Estate, all mechanical preparations (excavators and dozers) involved PT Fortuna Farmindo as the contractor. The manual land clearing in Mandang Estate for an area of 135.29 ha as follow :

a. The works for excavator stacking at Block M48, M49, and M54 for an area of 15.15 ha during the period of 1 – 15 July 2007. b. The works for excavator stacking at Block M46 and L53 for an area of 3.64 ha during the period of 1 – 15 April 2007. c. The works for excavator stacking on a 14.73 ha land was during the period of 16 – 30 April 2007. d. The works for excavator stacking on the 20.844 ha land was during the period of 1 – 15 February 2007.

The company has a procedure for land fire (SOP/NP/Smart/XI/LH002), describes the handling operation from the establishment of fire fighting squad both in the estate and the mill, fire hazard identification, and the preparation of fire fighting equipment. The facilities and infrastructure for fire fighting available as follows:

- Semilar Mill: 42 units of fire extinguishers (APAR), 7 units of water hydrants, one unit of fire-proof suit, and other supporting equipment.

- Semilar Estate: 34 units of fire extinguishers (APAR), water tank, water pump, and water hose. The company has identified the area prone to field fire, that are Lodge 1, Lodge 2, areas at the mill‟s vicinity, areas at the estate‟s vicinity, and Lodge 3. The company has also identified the level of fire prone based on the rainfall and the depth of peat land.


PRINCIPLE #8 Commitment to Continuous Improvement in Key Areas of Activity

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

Listed below are several actions have been taken to reduce the waste; 1. The usage of effluent for land application. 2. The usage of empty bunch waste for organic fertilizer. 3. The usage of (palm kernel) fibers and shells for boiler fuel. 4. The document of Reduction of Paraquat.

There is also the record of follow up to the stage-1 audit findings at PT Tapian Nadenggan and PT Buana Artha Sejahtera. There were 4 non-conformance potentials and 6 improvement opportunities that identified during stage-1 assessment. The company has demonstrated the efforts (action plan) towards stage-1 audit findings. The information contained such action plan, settlement target, and appointed the PIC (person-in-charge).



ASSESSMENT REPORT


3.2. Summary of Assessment Report of Supply Chain

Clause (Module E) CPO Mills - Mass Balance Requirements

1 Documented Procedures

1.1

The facility shall have written procedures and/or work instructions to ensure the implementation of all the elements specified in these requirements. This shall include at minimum the following: a) Complete and up to date procedures covering the implementation of all the elements in these requirements. b) The name of the person having overall responsibility for and authority over the implementation of these requirements and

compliance with all applicable requirements. This person shall be able to demonstrate awareness of the facilities procedures for the implementation of this standard.

a) A Procedure on the Identification and Traceability has already been prepared by the company and was authorized on 1 May 2012, under the document no. PT. TN-SMLM/SOP/01. The procedure specifies fruits receipt mechanism (from core estate, plasma, or supplier/independent smallholder), the processing, the oil and palm kernel kept in the storage tank, as well as the product delivery (CPO and palm kernel). This procedure also applied the supply chain system in compliance with the Mass Balance principles, specifying that all FFB received from various sources then processed simultaneously. Separetion method for core estate and non-core by recording their receipt code at the weighing bridge. The available records are weighing tickets. FFB processed simultaneously, while the delivery of CPO and palm kernel claimed to be certified products used Product Delivery Note that issued by the company. There are 7 (seven) documents of Declarations dated 1 October 2012 which were made to comply with the requirements and the objectives of supply chain system. The document of Declaration 2 mentioned that Semilar POM has applied the Mass Balance model.

b) The personnel responsible for the application of such requirements are:

The assistant, who shall responsible for the monitoring of FFB received, as to whether those FFB meet the specified standard and criteria; also for the monitoring of the FFB processing activity, and for the monitoring of the quality analysis of processed products.

Head of Administration, who shall responsible for the recording and reporting of the quantity and the quality of processed products on regular basis; for the monitoring of administrative process of FFB receipt and of product delivery, for the monitoring of essential equipment used in the supply chain and for ensuring that all said equipment are in good condition, accurately operating, licensed, and well-maintained.

Mill Unit Head (Management Representative), who shall responsible for ensuring that the entire process in supply chain system is well carried out, for ensuring that the Mass Balance calculation is done correctly to determine the number of certified products, and for providing information related to certified products to those who are requesting.

Production Controller (Top Management), who shall responsible for ensuring that the sources of products resulted are traceable, and that the delivery of the products is in conformance with both their quantity and quality.

Status : Full Compliance

1.2

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


ASSESSMENT REPORT


Refer to description 1.1 Semilar POM has applied the Mass Balance model in determining the certified and non-certified products. There are evidence of simulation Mass Balance Model application in the operational of Semilar POM. For example: Since declaring the implementation of supply chain in October 2012, the company has administratively separated the FFBs delivered from the estates which have applied the RSPO principles and criteria and not applied the RSPO principles and criteria. Further implementation shall be verified during surveillance-1.


2 Purchasing and goods in

2.1

The facility shall verify and document the volumes of certified and non-certified FFBs received.

The FFB received in Semilar POM were delivered from the core estates (Semilar Estate; Sei Rindu Estate; Mandang Estate and Puri Estate) and from another location (PT. Mitra Karya Agroindo – under the same holding as PT. Tapian Nadenggan). PT. TN have mechanism to separate the certified and Non-certified. Since declaring the implementation of supply chain on October 2012, the company has administratively been separating the FFB from the estates which have applied the RSPO principles and criteria and not applied the RSPO principles and criteria. Further implementation shall be verified during surveillance-1.


2.2

The facility shall inform the CB immediately if there is a projected overproduction.

In the SOP No. PT BAS-SMLM/SOP/01 dated 1 April 2012 section 6.2.2 (1) Monitoring Quantity. Stated that if the production projection is more than the certified products that have been claimed, then it must be notified to the Certification Body and the IT System.


3 Record keeping

3.1

The facility shall maintain accurate, complete, up-to-date and accessible records and reports covering all aspects of these requirements.

All records and reports related to the operational activities of the mill have been made and kept in their entirety. Those documents were stored in their soft copy version in the SAP program (System Application Program), while the hard copy version (print-outs) were stored in the specific cabinet in the administration room of Semilar POM. All subject matters related to the records of Mass Balance model implementation shall be verified during surveillance-1.



ASSESSMENT REPORT


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

There is an SOP for Record Control in the document No. PT. TN-SMLM/SOP/12, stating that the retention period for all records related to the environmental system and the operational recording of the mill is 10 (ten) years.


3.3 (a) The facility shall record and balance all receipts of RSPO certified FFB and deliveries of RSPO certified CPO, PKO and

palm kernel meal on a three-monthly basis. (b) All volumes of palm oil and palm kernel oil that are delivered are deducted from the material accounting system according

to conversion ratios stated by RSPO. (c) The facility can only deliver Mass Balance sales from a positive stock. However, a facility is allowed to sell short.

Despite the company has not secured an RSPO certificate, Semilar POM has conducted a simulation related to the Mass Balance Model application, to ensure the traceability of the products resulted, effective per October 2012 (when the application of Mass Balance Model was first declared).

Status : Not Yet Applicable

3.4 The following trade names should be used and specified in relevant documents, e.g. purchase and sales contracts, e.g. *product name*/MB or Mass Balance. The supply chain model used should be clearly indicated.



3.5 In cases where a mill outsources activities to an independent palm kernel crush, the crush still falls under the responsibili ty of the mill and does not need to be separately certified. The mill has to ensure that the crush is covered through a signed and enforceable agreement.

No an independent palm kernel crush or no outsourcing.


4 Sales and goods out


ASSESSMENT REPORT


4.1

The facility shall ensure that all sales invoices issued for RSPO palm oil delivered include the following information:

(a) The name and address of the buyer

(b) The date on which the invoice was issued

(c) A description of the product

(d) The quantity of the product delivered

(e) Reference to related transport documentation



5 Training

5.1

The facility shell specifies and provides the training for all staff as required to implement the requirements of the Supply Chain Certification Systems.

Semilar POM has trained employee who related about procedure of Supply Chain Certification System. The training was conducted on 27 November 2012. The company has also given similar training to the weighing workers and the security guards on 30 November 2012.


6 Claims

6.1 The facility shall only make claims regarding the use of or support of RSPO certified oil palm products that are in compliance with the RSPO Rules for Communications and Claims.

The Mill compliance with RSPO Rules for Communications and Claims.



ASSESSMENT REPORT


3.3. Conformity Checklist of Certificate and Logo Use (Only apply for Surveillance Assessment Report)

1. Evidence of permission or approval certificate and logo from Certification Body which submitted by Client

Status

2. Implementation of certificate and logo used by Client comply with size and type (shape) against Guideline of Logo Use

3. Implementation of Certificate and Logo is not used on product

4. Controlling of Certificate and Logo, including withdrawing inappropriate logo


ASSESSMENT REPORT


3.4. Summary of Time Bound Plan Verification of the RSPO Certification

Smart Tbk Group has 14 Management Unit, 5 (five) Management Unit already assessed by the other Certification Body and certified, and 8 (eight) Management Units are still preparation process to certification. The Management Unit of Smart Tbk Group are:

1. PT Tapian Nadenggan (Semilar Mill), South Kalimantan (already assessed for RSPO by PT Mutuagung Lestari) 2. PT Leidong West Indonesia (Leidong West Mill) Bangka (preparation process to certification)* 3. PT Kresna Duta Agrindo (Jelatang Mill) Jambi (preparation process to certification)* 4. PT Tapian Nadenggan (Jak Luay Mill) East Kalimantan (preparation process to certification) 5. PT Kresna Duta Agroindo (Gunung Kombeng Mill/ Muara Wahau Mill) East Kalimantan (preparation process to

certification) 6. PT Kresna Duta Agroindo (Pelakar Mill) Jambi (preparation process to certification) 7. PT Kresna Duta Agroindo (Langling Mill) Jambi (preparation process to certification) 8. PT Satya Kisma Usaha (Sungai Bengkal Mill) Jambi (preparation process to certification) 9. PT Smart Tbk (Bukit Kapur Mill) South Kalimantan (preparation process to certification) 10. PT Smart Tbk (Padang Halaban Mill) North Sumatera (Certified) 11. PT Smart Tbk (Batu Ampar Mill) South Kalimantan (Certified) 12. PT Smart Tbk (Tanah Laut Mill) South Kalimantan (Certified) 13. PT Smart Tapian Nadenggan (Langga Payung Mill) North Sumatera (Certified) 14. PT Tapian Nadenggan Tbk ( Hanau Mill) Central Kalimantan (Certified)

Total Company who visited: (0.8 √ Y) where Y is the number of companies that are still in the process of certification. Thus, the team determines the location of the samples verified that are PT Leidong West Indonesia (Leidong West Mill) Bangka; PT Satya Kisma Usaha (Sungai Bengkal Mill) Jambi and PT Kresna Duta Agrindo (Jelatang Mill) Jambi. Date of Observation: 21 February 2013

2.1

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

Based on results of verification in 2 units as an example of the assessment, company has complied with the regulation.

√

Status: Complied

2.2

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

Based on documents verification, there is no land conflict in each sample units. Company have SOP/NP/SMART/XII/MCAR001 about grievance handling, 1st revision on 1 July 2010 and it had been socialized to stakeholders.

√

Status: Complied

6.3

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

Company have SOP complaint and grievance (SOP/NP/SMART/XII/MCAR001), 1st revision on 1 July 2010 and it had been socialized to stakeholders.

√

Status: Complied

6.4

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

Company have SOP/NP/SMART/VII/D&L002 SOP about land compensation,1st revision on 1 July 2010. Some land compensation has been paid and available the records of land compensation in each company.

√

Status: Complied


ASSESSMENT REPORT


7.3

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

There is no new plantings since November 2005 in primary forest or HCV area √

Status: Complied

7.5

No new plantings are established on local peoples’ land without their free, prior and informed consent, dealt with through a documented system that enables indigenous peoples, local communities and other stakeholders to express their views through their own representative institutions.

PT Leidong West Indonesia (Leidong West Mill) Bangka and PT Duta Agrindo Krishna (Nettle Mill) Jambi Since November 2005 not to expand the operational area. PT Satya Kisma Usaha: Available of Documentation is given by related organisation by Free, Prior and Informed Consent regarding certain areas in primary estate i.e. KILE with status of state land and KILA with status of people land, and introduce the program to support plasma activities which lead to PKS. The status of land in primary estate KILE has no process of compensation due to ownership of state land and no cultivation or farming on the land by people. The stages of the state status are seen from some existence below:

1. Location permit issued by local administration (Head of District) in 2011

2. Activities of kadesteral by BPN which was conducted on 24 June 2011.

3. Claim that the state land is APL area (other use of land) from Forestry Dept. Of Jambi

Province dated 29 june 2012.

4. SKD Head of Village letter of Muara Kilis dated 20 March 2013, head of Sungai Keruh village

with area of 1.364 Ha claims that the area belongs to state land and not customary land, not

under ownership/cultivation by local people.

5. SKD Head of Village letter of Muara Kilis dated 20 March 2013, Head of Sungai Keruh village

with area of 14.21 Ha, claims that the land belongs to state land and not customary land, not

under ownership/cultivation by local people. The SKD is signed by local head of village and

head of BPD Muara Kilis Village and S Keruh Village, sub-district head of Central Tebo and

sub-district head of Tebo.

√

Status: Complied

7.6

Local people are compensated for any agreed land acquisitions and relinquishment of rights, subject to their free, prior and informed consent and negotiated agreements.

PT Leidong West Indonesia (Leidong West Mill) Bangka and PT Duta Agrindo Krishna (Nettle Mill) Jambi Since November 2005 not to expand the operational area. PT Satya Kisma Usaha: The status of land in primary estate KILE has no process of compensation due to ownership of state land and no cultivation or farming on the land by people. The stages of the state status are seen from some existence below:

1. SKD Head of Village letter of Muara Kilis dated 20 March 2013, head of Sungai Keruh village

with area of 1.364 Ha claims that the area belongs to state land and not customary land, not

under ownership/cultivation by local people.

2. SKD Head of Village letter of Muara Kilis dated 20 March 2013, Head of Sungai Keruh village

with area of 14.21 Ha, claims that the land belongs to state land and not customary land, not

under ownership/cultivation by local people. The SKD is signed by local head of village and

head of BPD Muara Kilis Village and S Keruh Village, sub-district head of Central Tebo and

sub-district head of Tebo.

√

Status: Complied


ASSESSMENT REPORT

SPO – 4006a.5 Page 54

Prepared by Mutuagung Lestari for Semilar POM - PT. Tapian Nadenggan

3.5 Identification of Findings, Corrective Action, Observations, Opportunity for Improvement and Noteworthy Positive Components.

Further explanation of the non-conformities raised and corrective actions taken by the company are provided in this section. The company prepared a corrective action that was reviewed and accepted by MUTU and corrective actions taken to close all non-conformities shall be verified during next assessment.

3.5.1

Identification of Findings, Corrective Actions and Observations at ST1 Assessment During the ST1 assessment, there were 0 (none) Nonconformity were assigned against Major Compliance Indicators, 2 (two) Nonconformities were assigned against Minor Compliance Indicators, 0 (none) opportunities for improvement were identified. The company prepared a corrective action that was reviewed and accepted by MUTU and corrective actions taken to close all potention non-conformities on stage 1.

No. CAR

Ref Std

Findings Location Grade Time

Limits Corrective Action Observations and Date Status

Closing date

2012.01 Minor 4.4.1

Records on The Implementation of Water Treatment Program. The company keeps the records on the implementation of riparian conservation. However, no proofs have been shown as to whether the program a success and in compliance with the SOP of HCV Identification and Management.

PT. TN and PT. BAS

NC Potentials

Before ST2

Conducting the monitoring on the planting/cultivating activity at riparian.

08 February 2013 The document observation and the field visit provided with the proofs confirming that the company has conducted such monitoring on the riparian conservation that complied with the SOP of HCV Identification and Management.

Closed 08-Feb-2013

2012.02 Minor 5.6.2

POME Management. The company has done a POME management by making a wastewater pond, whose liquid/effluent was then used for Land Application. In doing such activity, the company has complied with the instructed stages as specified in the applicable regulation (The Regulation of

PT. TN and PT. BAS

NC Potentials

Before ST2

Ensuring that the application was done at the licensed area.

08 February 2013. The field observation (Block J-39) has confirmed that such activity had been discontinued. The confirmation was also reinforced by the letter from the Head of Seruyan District No. 660/58/BLH.I/I/2013 which stated that the

Closed 08-Feb-2013


ASSESSMENT REPORT

SPO – 4006a.5 Page 55


No. CAR

Ref Std

Findings Location Grade Time


Closing date

Environmental Ministry (Permen LH) No. 28 year 2003), in which it is compulsory that the company submit a request for the license to do Land Application assessment and that the company possess such license prior to conducting the assessment. However, the assessment result of the POME application records revealed that there was POME effluent application found at Block J-39 for an area of 29 ha with the volume of 3,635 m3, which was located outside the predetermined area specified in the license.

application done outside the licensed area had been discontinued.


ASSESSMENT REPORT

SPO – 4006a.5 Page 56


3.5.2 Identification of Findings, Corrective Actions and Observations at ST2 Assessment During the ST2 assessment, there were 0 (none) Nonconformity were assigned against Major Compliance Indicators, 1 (one) Nonconformity was assigned against Minor Compliance Indicators, 3 (three) opportunities for improvement were identified. Further explanation of the non-conformities raised and corrective actions taken by the company are provided in this section. The company prepared a corrective action that was reviewed and accepted by MUTU and corrective actions taken to close all non-conformities shall be verified during next assessment.

No. CAR

Ref Std Findings Location Grade Time


Closing date

2013.01

Minor 5.6.1

Record of the odor level measurement. The company has not conducted the monitoring on the level of odor at the locations identified as the sources of odor in accordance with the available document of environmental aspects.

Mill

Minor S1 The Company shall have activity plan and records of pollution decreasing related to perform the monitoring activity on the level of odor in accordance with the environmental aspects analysis.

Open


ASSESSMENT REPORT

SPO – 4006a.5 Page 57


3.5.3 Opportunity for Improvement

No Ref.Std Description

1 Major 2.2.1

PT. Buana Artha Sejahtera should to make sure prolongation of location permit , forest area release through the process of forest area exchange refer on Government Rule No. 60, 2012 and process to acquiere certificate of Land Use Right (Observation).

2 Major 2.2.3

The company should to follow up the process for overcome the land claim by communities in Puri Estate (Observation).

3 Minor 6.5.1

The company neet to ensure that the water of well that pH < 6.5 do not to consumption. Forinstance: Well in Cottage 3 Mandang Estate, Cottage 1 dan 2 Semilar Estate.


ASSESSMENT REPORT

SPO – 4006a.5 Page 58


3.5.4 Noteworthy Positive Components.

No Ref.Std Description

1 - The company commitment to implementation the principles of sustainable palm oil management.

2 - The company already have the staff to responsible in their jobs

3 4.7 The company already implemented Management of Health and Safety with satisfy assessment results by auditor of Management of Health and Safety to mandate by Ministry of Worker.

4 5.2 Komitmen dan keterlibatan perusahaan dalam upaya-upaya pelestarian orang utan (Pongo pygmaeus)

5 Minor 6.5.1

The company already to serve public facility (Rumah Pintar) as collaborative Program by the Solidarity Wife of Indonesian Cabinet Union Period II and PT. Smart, Tbk. Those facilities is nom formal education media for chidrens and mothers adjacent of plantation area.

6 Kriteria 8.1

The cpmpany already getting the certificate of ISCC(International Sustainability and Carbon Certification) No.Reg: ISCC-Reg-1726 for Semilar Mill since Nopember 28, 2012 and valid until Nopember 27, 2013.


ASSESSMENT REPORT

SPO – 4006a.5 Page 59


3.6 Summary of Arising Issues from Public, Organization and Auditor Response

Public Issues Organization Response Auditor Response

Social Affairs and Manpower Office of Seruyan District. (Head of Labour Control Divison) Positive Issues:

- The reports of P2K3 (Guiding Committee of Occupational Safety & Health) of PT. Tapian Nadenggan & PT. Buana Artha Sejahtera have been submitted in compliance witn the requirements.

- No recorded issues over labor-related conflicts. - No minors were being recruited. - The workers‟ wages have been paid in

accordance with the regional regulation stipulated in the UMP (Provincial Minimum Wage).

- The licensings related to the worker‟s operational (such as Operator License & Welder‟s Certificate) have been complied with.

- No cases of occupational accident were recorded during the whole year.

- Social Affairs and Manpower Office of Seruyan District, represented by the officials from the Control Division, has been regularly conducting site visits (on annual basis at minimum) in order to monitor all labor-related activities at the company.

Social Affairs and Manpower Office of Seruyan District, represented by the officials from the Control Division, shall be doing regular visits (on annual basis at minimum) in order to monitor the manpower-related activities at the company, which includes the monitoring on the wage implementation that complied with regulation, the workers‟ age limit, the workers‟ competence, and the reports of occupational accident.

National Land Agency (BPN) of Seruyan District. (Head of Control and Empowering Division)


ASSESSMENT REPORT

SPO – 4006a.5 Page 60


Positive Issues: - PT Tapian Nadenggan has secured 3 certificates

of HGU (Land Use Title) for areas within the administrative scope of Seruyan District.

- No issues were recorded that were related to land conflicts in the areas within the administrative territory of Seruyan District.

- The company has conducted a number of CD/CSR programs for the surrounding community.

- No indigenous land / ancestral land with its supporting evidence were found at Seruyan District.

The company have to coordination with the BPN (National Land Agency) for issues related to land acquisitions.

Environment Bodies of Seruyan District (Head of Law Enforcement & EIA Division) The Land Application license granted to PT. Tapian Nadenggan for the assessment stage, is valid until June 2013 (six month-period, as per the issuance). The said license will then be the subject of evaluation for its potential impacts, and is renewable for another one year-period. Six months prior to expiry of the license, the company shall be presenting the assessment results of mill effluent treatment to the BLH (Environment Bodies) of Seruyan District. The assessment results will then be the base for the consideration as to whether the company has fully complied with the permitted volume of effluent applied on plantation area.

All misuses of the Hazardous Waste symbols were immediately corrected during field visit from BLH (environment Bodies).

The company has taken full notice of all principles in relation to the aspects of the monitoring and the management of the environment that complied with the applicable regulation, under the supervision of Environment Bodies.


ASSESSMENT REPORT

SPO – 4006a.5 Page 61


Positive Issues: - The company has submitted the Implementation

Report of RKL/RPL to BLH on regular basis (per semester / six-month period)

- The Hazardous Waste storage area and its storage period have been specified in compliance with the applicable regulation.

- No information nor objections were conveyed by respective parties concerning the impacts resulting from the management of Semilar palm oil mill effluent.

Negative Issues: - There are still a number of Hazardous Waste

symbols being used or installed in incorrect manners.

Forestry and Plantation Agency of Seruyan District. (Head of Plantation Business Development Division) Positive Issues:

- All reports related to the management of plantation business have been submitted on regular basis.

- The reports of the Implementation of RKL/RPL have been submitted on regular basis (the copies of which were also submitted to the Forestry and Plantation Agency).

- No information nor reports were being filed concerning the impacts resulting from the environmental management.

- The company has conducted a number of CD/CSR, such as: school aids, road repair, and supply aid on religious events/days).

- No information was received concerning land conflict.

The company is managing the plantation in accordance with the regulation, and under the supervision of the Forestry and Plantation Agency.


ASSESSMENT REPORT

SPO – 4006a.5 Page 62


Social Affairs, Manpower, and Transmigration Office of Kotawaringin Timur District. (Head of the Office)

- All matters concerning the land dispute between the company and several residents of Biru Maju Village are at present being handled by a district-level Integrated Team, awaiting the decision from the District Head, as the authority of the region, to be made on the allotment of the disputed areas.

- In terms of legality, several residents of Biru Maju Village were (apparently) unable to present the proof of ownership (legality) of the land they were claiming for.

It is recommended that the company create the documentation of the process/progress of the dispute settlement, the action plan, and the target of available solutions.

Biru Maju Village (Former Village Head, Community Figures, and Local Residents) There is currently no definitive Village Head serving at Biru Maju Village, while the Acting Village Head was not available at the time this interview took place. Positive Issues:

- In legal terms, the company has secured the license for the areas claimed by several residents of Biru Maju Village.

- This issue is at present being handled by a district-level Integrated Team.

- During the period of 1996 – 1997 there was a specific area allocated for transmigration, which is now Biru Maju Village, though it is not the APL area which is currently being disputed.

- The current claim over land made by several residents is merely “an action of a few”, not representing the village as a whole.

The company has always responded to every incoming claim. At times when it was impossible for the company to do an immediate and direct settlement with the residents, assistance would be sought from District Leadership Assembly (Muspika). Samples of responses to claims:

1. A Claim made by Safrudin and submitted on 24 October 2011, was responded by the company on 29 October 2011. No further claim has been made and submitted.

2. A request for settlement assistance for the claims made by the residents, which was sent to Head of Telawang Subdistrict. The company responded to the letter by holding an assembly that put together the company, the residents, and the subdistrict‟s

It is recommended that the company create the documentation of the process/progress of the dispute settlement, the action plan, and the target of available solutions.


ASSESSMENT REPORT

SPO – 4006a.5 Page 63


Negative Issues:

- It is apparent that the company is still less pro-active in following up the claim for land made by several residents of Biru Maju Village. In fact, when the company has secured the necessary license (legality) for the disputed area, it is supposed to have a stronger standing by law.

- A solution was once offered by the respective

party from the village, in relation to the implementation plan of the plasma farmer program initiated by Biru Maju Cooperatives (for an area of 530 ha through a compensation process). It was then rejected by central management.

representative in the same room on 18 March 2010.

The request for the implementation of a new plasma program was conveyed orally, never in written form. However, the company has initiated the inspection on the indicated area, to find out that it was holding a status of production Forest. This finding has resulted in the company not being able to proceed with such request.

Pantab Village (Village Secretary, Community Figures, and several Residents) Positive Issues:

- The company has provided a number of assistance for the village people, such as: lending heavy equipments for road repair, assistance in establishment of places of worship/pesantren (Islamic Boarding Schools).

- The company has always responded well to every request for assistance that was submitted through a letter or a proposal.

The aircrafts used for aerial fertilizer application have been equipped with AGNAV System. All the blocks that will be applied have been included into the AGNAV program so that the aircraft will only be flying within the specifically programmed route. The aerial topdressing is not done at the blocks located near housing complex. Moreover, as per 2012, the riparian areas are also excluded from the aerial topdressing route.

It is advised that the areas identified as conserved areas or HCV areas to be consistently managed in accordance with the identification results. The negative impacts resulting from the management of oil palm plantation are supposed to be controllable and reducible.


ASSESSMENT REPORT

SPO – 4006a.5 Page 64


Negative Issues: - There have been complaints coming from

several village residents, pointing out that whenever the aerial topdressing (fertilizer application using aircraft) took place, it would be followed by a series of fever and skin rash cases which was suspected to be the effect of contaminated water reserves. There have also been some information mentioning that some of the resident‟s rooftops were corroded after such aerial fertilizer application.

The “Save Our Borneo” NGO (Non-Government

Organization).

Negative issues arising were more to the issues

concerning Sinarmas Group with an assumption that the

same conducts of management and organizational are

applied (SMART).

Several important issues in Seruyan District are listed

below:

- There was reportedly a land conflict happened

between PT Agromandiri Perdana and the

surrounding community, which resulted in a strike.

- Land clearing for oil palm that was done on forest

land has not been equipped with the license for

forest area waiver.

- The disposal of mill effluent to nearby the main

river needs careful attention.

Regarding the issue on the conflict of land between PT

Agromandiri Perdana with the surrounding community,

over which a strike also took place; because the land

clearing process for oil palm done on forestland has

not gained a waiver license for forest area, the scope

of assessment was only covering PT TN-BAS. In

addition, the company has processed the licensed for

forest area waiver

The company does not dispose of the effluent into the

main water, but uses it for land application.

- For any conflict arising between the company and the

surrounding community, it would be best that the

settlement be done through prior consent which shall

be accepted by both parties without any coercion (free,

prior, and informed consent).

- Land clearing for oil palm which is done on forest land

must comply with the applicable regulations (refer to

criteria 2.2).

- The disposal of effluent shall be done in accordance

with the applicable regulations set by license issuer

(relevant institution).


ASSESSMENT REPORT


4.0 CERTIFIED ORGANISATION'S ACKNOWLEDGEMENT OF INTERNAL RESPONSIBILITY

4.1 Formal sign-off of assessment findings

Hereunder sign by management representative from inspected company to acknowledge a field assessment and agree for all content explained in this assessment report, included of non-compliance findings.

Signed on behalf of:

Management Representative

MUTUAGUNG LESTARI

PT. SMART, Tbk

Lead Auditor

Ismu Zulfikar

Oktovianus Rusmin

February, 08, 2013

February, 08, 2013


ASSESSMENT REPORT


Annex 1. List of Stakeholder Contacted in the RSPO Certification Process

No Institution Address No. Telp/Email Sent by Date

1 Labour Agency of Seruyan District

Kuala Pembuang Sub-district, Seruyan District

- Interview 05/02/2012

2 National land Agency of Seruyan District



3 Environment Agency of Seruyan District



4 Agriculture Agency of Seruyan District



5 Public Community and Villagers Biru Maju Village

Biru Maju Village, Telawang Sub-district, Kotawaringin Timur District


6 Representative Village, Public Community of Pantab Village

Pantab Village, Mentaya Hulu Sub-district, Seruyan District.


7 Save Our Borneo Palangkaraya, Kalimantan

Tengah

Phone: 081352752775

(Mr. Noerdin)

Email:

[email protected],

[email protected]

By phone December 20,

2012




ASSESSMENT REPORT


Annex 2. Audit Programme

DATE February, 04-08, 2013 AUDITOR

TIME ALLOCATION

ACTUAL Evaluation OR MES ISP BB

Monday, 04/02/2013

06.30 - 08.30 09.00 - 12.00 12.00 - 14.00 14.30 - 15.00 15.00 – 17.00

Monday, 04/02/2013

06.30 - 08.30 09.00 - 12.00 12.00 - 14.00 14.30 - 15.00 15.00 – 17.00

Jakarta – Pangkalanbun Pangkalanbun - PT. Tapian Nadenggan and PT. Buana Artha Sejahtera Ishoma (Break) Opening Meeting Completion of checklist

√ √ √ √

Tuesday, 05/02/2013

08.00 – 12.00

12.00 – 14.00 (Break)

14.00 - 17.00

Tuesday, 05/02/2013

08.00 – 12.00

12.00 – 14.00 (Break)

14.00 - 17.00

Public Consultation (Kuala Pembuang) Completion of checklist

√ √ √ √

Record of Information and Responds 1.1; 1.2 √

Fullfilment of regulations 2.1

√ √ √ √

Legality, Permits and Tenure 2.2; 2.3 √ √

Economic Long term planning 3.1 √

Best Practices / Good Agriculture Practices (harvest, transport, processing) planting and maintenance

4.1 √

Soil and water Conservation 4.2; 4.3; 4.4; 7.2; 7.4

√

Integrated Pest Management 4.5 √

Used by agrochemical 4.6 √

Occupational Health and Safety 4.7; 4.8 √

Responsible to environment and social 5.1; 6.1; 7.1; 7.7 √ √

High Conservation Value and Protection Area 5.2; 7.3; √

Waste management, efficiency energy and reduction pollution

5.3; 5.4; 5.6 √ √

Waste Liquid using √

Preventive and Handling of land fire 5.5; 7.7 √ √

Communication, Information and Consultation with community

6.2; 6.3; 6.4; 7.5; 7.6

√

Labour Resposible 6.5; 6.6 √

Social responsible 6.7; 6.8; 6.9; 6.10; 6.11

√

Continuous Improvement 8.1 √ √ √ √

Supply Chain S.C.C.S √

Wednesday, 06/02/2013

08.00 – 12.00 12.00 – 14.00 14.00 - 17.00

Wednesday, 06/02/2013

08.00 – 12.00 12.00 – 14.00 14.00 - 17.00

Field Visit at Estate and Mill Ishoma (Break) Continued to Document review

√

√

√

√


ASSESSMENT REPORT


DATE February, 04-08, 2013 AUDITOR

TIME ALLOCATION

ACTUAL Evaluation OR MES ISP BB

Thrusday, 07/02/2013

08.00 – 12.00 12.00 – 14.00 14.00 - 17.00

Thrusday, 07/02/2013

08.00 – 12.00 12.00 – 14.00 14.00 - 17.00

Field Visit at Estate and Mill Ishoma (Break) Field Visit Verification

√

√

√

√

Friday, 08/02/2013

08.00 – 09.00 12.00 – 14.00 14.00 – 16.00 17.00 – 19.00

Friday, 08/02/2013

08.00 – 09.00 12.00 – 14.00 14.00 – 16.00 17.00 – 19.00

Preparing for Closing Meeting Ishoma (Break) Closing Meeting Travelling to Pangkalan Bun

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Saturday, 09/02/2013

08.00 – 09.30

Saturday, 09/02/2013

08.00 – 09.30

Travelling from Pangkalan Bun to Jakarta

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ASSESSMENT REPORT


Annex 3. Glossary

AAA : Agronomy Audit and Advisory

AMDAL : Social and Environmental Impact Assessment

APD / PPE : Personal Protection Equipment

ASEAN : Association of South East Asian Nations

AVP : Assisstant Vice President

B3 : Hazardous Material Waste

BOD : Biological Oxygen Demand

CEO : Chief Executive Officer

CPO : Crude Palm Oil

CBD : Convention on Biodiversity

ENDV : Environment Division

HCV : High Conservation Value

HGU : Land Use Permit

ISBPR / HIRARC : Hazard Identification Risk Assessment and Risk Control

IUP : Plantation Operation Licence

IPAL / WWTP : Waste Water Treatment Plant

JAMSOSTEK : Social Assurance of Labor

Jankos / EFB : Empty Fruit Bunch

K3 / OHS : Occupational Health and safety

KER : Kernel Extarction Rate

LC : Land Clearing

MAA : Mill Audit Advisory

MB : Mass Balance

NC : Non Comformance

OIA : Operations Internal Audit

OER : Oil Extarction Rate

P2K3 : Occupational Safety and Health Committee

PC : Production Controller

PHT / IPM : Integrated Pest Management

PK : Palm Kernel

PKS / POM : Pabrik Kelapa Sawit / Palm Oil Mill

PSM : Perkebunan Sinarmas

RC : Region Controller

RKL/RPL : Environmental Management Plan/ Environment Monitoring Plan

SMARTRI : Smart Reseach Institute

SOP : Standart Operational and Procedure

TBS / FFB : Fresh Fruit Bunches

UKL/UPL : Environmental Management Efforts/ Environmental Monitoring Efforts

VPA : Vice President Agronomy