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Roundtable on Sustainable Palm Oil Recertification Audit

Report no.: RA1A_82450214009

Surveillance assessment against the RSPO Principles & Criteria Generic year 2013 and RSPO SCCS year 2014

Name of client Wilmar International Limited

PT Mustika Sembuluh Head Office :

Multivision Tower 12th floor, Jl. Kuningan Mulia Kav.9B, Guntur, Setiabudi Village, Kuningan Sub District, South Jakarta District, DKI Jakarta Province, Indonesia

Representative Office : Jl.H.M Arsyad No.100, Sampit, Kotawaringin Timur District, Central Kalimantan Province

Estate & Mill :

Bangkal Village, Danau Sembuluh Sub-District, Kotawaringin Timur District, Central Kalimantan, Indonesia

Date of assessment : June 29 to July 04, 2015

Report prepared by : Hendra Fachrurozy (RSPO Lead Auditor)

Certification decision by :

Abdul Qohar (Head of Certification Body PT TUV Rheinland Indone sia)

Certification Body: PT TUV Rheinland Indonesia

Menara Karya, 10th Floor, Jl. H.R Rasuna Said Blok X-5 Kav.1-2

Jakarta 12950, Indonesia Tel : +62 21 579 44 579 Fax : +62 21 579 44 575

www.tuv.com

TABLE OF CONTENTS

1.0 SCOPE OF Surveillance Audit.................... .............................................................. 3

1.1 National Interpretation / Standard Used ................................................................................................. 3 1.2 Scope of Assessment ............................................................................................................................. 3 1.3 Certification Details ................................................................................................................................ 3 1.4 Location and Maps ................................................................................................................................. 3 1.5 Organisational Information / Contact Person ......................................................................................... 7 1.6 Description of Supply Base .................................................................................................................... 8 1.7 Actual production volumes, tonnages and projected outputs. ............................................................... 8 1.8 Dates of Plantings and Replanting Cycles ............................................................................................. 9 1.9 Area of Plantation (Total, Planted and Mature) ................................................................................... 10 1.10 Progress Against Time Bound Plan ................................................................................................... 10 1.11 Compliance to Rules for Partial Certification ..................................................................................... 12 1.12 Progress of associated smallholders or outgrowers towards RSPO compliance: ............................ 14 1.13 Approximate Tonnages Certified ....................................................................................................... 14

2.0 ASSESSMENT PROCESS ....................................................................................... 15

2.1 Certification Body ................................................................................................................................. 15 2.2 Qualifications of Lead Assessor and Assessment Team .................................................................... 15 2.3 Assessment Methodology & Agenda ................................................................................................... 15

3.0 ASSESSMENT FINDINGS........................................................................................ 17

3.1 Summary of Findings pertaining to RSPO Principles & Criteria ........................................................ 17 3.2 Status of Previously Identified Non-conformities ................................................................................ 50 3.3 Identified Non-conformances against RSPO P&C Requirements, Corrective Actions Taken and

Auditors Conclusions .......................................................................................................................... 58 3.4 Description of Supply Chain Management System ............................................................................ 70 3.5 Status of Previously Identified Non-conformities ................................................................................ 70 3.6 Identified Non-conformances against RSPO SCCS Requirements, Corrective Actions Taken and

Auditors Conclusions .......................................................................................................................... 70 3.7 Conclusion and Recommendation for RSPO P & C and Supply Chain Certification ........................ 71 3.8 Issues Raised by Stakeholders and Findings Pertaining to Issues ................................................... 71

4.0 CERTIFIED ORGANISATION’S ACKNOWLEDGEMENT OF INT ERNAL

RESPONSIBILITY .................................... ...................................................................... 75

4.1 Date of Next Surveillance Visit ............................................................................................................. 75 4.2 Acknowledgements of Internal Responsibility and Formal Sign-Off by Client .................................... 75

APPENDICES ................................................................................................................. 76

Appendix 1: List of Abbreviations ............................................................................................................... 76 Appendix 2 : List of Stakeholders Interviewed and Contacted .................................................................. 79 Appendix 3: Observations and Opportunities for Improvement ................................................................. 79

Recertification Audit Report

- PT Mustika Sembuluh – Central Kalimantan -

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1.0 SCOPE of SURVEILLANCE AUDIT 1.1 National Interpretation / Standard Used

The operations of the palm oil mill(s) and its supply base of FFB were assessed against the Generic year 2013 of the RSPO Principles & Criteria and RSPO SCCS November 2014. Since the management of smallholder scheme is under PT Mustika Sembuluh directly, the requirement for the smallholder (Koperasi Bita Maju Bersa-ma) certification audit is also using RSPO Principle & Criteria year 2013 of the RSPO Principles & Criteria.

1.2 Scope of Assessment

The recertification audit was carried out on 2 mills and 3 estates under PT Mustika Sembuluh Palm Oil Mill owned by Wilmar International Limited and 1 smallholder scheme (Koperasi Bita Maju Bersama). The date of certificate of this unit was August 11, 2010 where valid until August 10, 2015. Since year 2014, there are exten-sion scope i.e 1 mill (PT Mustika Sebuluh POM 2) and 1 smallholder (Koperasi Bita Maju Bersama).

1.3 Certification Details The details of RSPO certification of PT Mustika Sembuluh (PT MS) are as per the table below :

Table 1: Certification details of PT Mustika Sembulu h

Note : *). Based on projection of FFB process, CPO & PK (include extraction rate) year 2016

1.4 Location and Maps

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

Name of mill / es-tate

Location GPS locations

Latitude Longtitude

PT MS POM 1 Pondok Damar Village, Mentaya Hilir Utara Subdistrict, Ko-tawaringin Timur District. 02° 35’ 28” S 112° 30’ 45” E

PT MS POM 2 Sebabi Village, Telawang Subdistrict, Kotawaringin Timur District. 02° 27’ 25.2” S 112° 30’ 04.3” E

PT MS Estate 1 Pondok Damar Village, Mentaya Hilir Utara Subdistrict, Ko-tawaringin Timur District. 02° 35’ 10” S 112° 30’ 32” E

PT MS Estate 2

Pondok Damar Village, Mentaya Hilir Utara Subdistrict, Ko-tawaringin Timur District. Bangkal Village, Danau Sembulu Subdistrict, Seruyan Dis-trict.

02° 39’ 56” S 112° 32’ 18.5” E

PT MS Estate 3 Tanah Putih Village, Telawang Subdistrict, Kotawaringin Ti-mur District. 02° 30’ 16.9” S 112° 30’ 36.6” E

Koperasi Bita Maju Bersama

Jl. Macan Lantut RT 001 RW 001, Pondok Damar village, Mentaya Hilir Utara Sub District, Kotawaringin Timur District 02° 40’ 12.96” S 112° 34’ 15.99” E

RSPO Membership no.: 2-0017-05-000-00 on behalf Wilmar International Lim-ited since on 15 August 2005

RSPO Certificate no.: 824 502 14009

Date of first RSPO certificate & validity: August 11, 2010 & validity : 2010-08-24 to 2015-08-23

Date of certification audit: October 19 to 23, 2009

Date of previous surveillance audit: June 24 to 27, 2014

Date of revised RSPO certificate & validity (if applicable):

January 04, 2016 & valid until August 23, 2020

CPO tonnages claimed (tonnes)* : 99,072.00

PK tonnages claimed (tonnes)* : 19,608.00



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Figure 1 : Location map of PT Mustika Sembuluh within Central Kalimantan, Indonesia

PT Mustika Sembuluh



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Figure 2 : Map of PT MS Estates 1, 2 and 3, and PT MS Palm Oil Mill (POM 1 & POM 2)

Koperasi Bita Maju Ber-sama



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Figure 3 : Map of Koperasi Bita Maju Bersama (Smallholder)



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1.5 Organisational Information / Contact Person

Contacts details of the company are as follows :

Company Name: PT Mustika Sembuluh

Address:

Contact Person

Head office: Multivision Tower 12th floor, Jl. Kuningan Mulia Kav.9B, Guntur, Setiabudi Village, Kuningan Sub District, South Jakarta District, DKI Jakarta Province, Indonesia .

Branch office: Jl.H.M Arsyad No.100, Sampit, Kotawaringin Timur District, Central Kalimantan Prov-ince

PT Mustika Sembuluh mill 1 : Bangkal Village, Danau Sembuluh Sub-district, East Kotawaringin Timur District, Central Kalimantan.

PT Mustika Sembuluh mill 2 : Sebabi Village, Telawang Subdistrict, Kotawaringin Timur District .

PT Mustika Sembuluh Estate 1 : Pondok Damar Village, North Mentaya Hilir Sub-district, East Kotawaringin District

PT Mustika Sembuluh Estate 2: Pondok Damar Village, North Mentaya Hilir Sub-district, East Kotawaringin District.

Bangkal Village, Danau Sembulu Sub-district, Seruyan District

PT Mustika Sembuluh Estate 3 : Tanah Putih Village, Telawang Sub-district, East Kotawaringin District

Koperasi Bita Maju Bersama : Jl. Macan Lantut RT 001 RW 001, Pondok Damar village, Mentaya Hilir Utara Sub District, Kotawaringin Timur District

MS. Eka Amana

Telephone: Tel. (0531) 34520-24

Fax. (0531) 34534

Email: [email protected]



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1.6 Description of Supply Base

Table 3 : FFB Supply Information for PT Mustika Semb uluh POM in year 2014 & 2015 (before grading)

FFB Contributors FFB supplied Jan - Dec 2014 FFB supplied Jan - May 2015

Tonnes % Tonnes % PT Mustika Sembuluh Mill 1

Company owned estates :

Mustika Sembuluh 1 148,008.99 54.29 56,262.67 52.32


Mustika Sembuluh 3 1,105.60 0.41 246.42 0.23

Sub Total 256,316.99 94.02 105,572.44 98.17 Wilmar’s group estate :

PT Kerry Sawit Indonesia* 3,436.20 1.26 0.00 0.00

PT Sarana Titian Permata* 7,545.87 2.77 0.00 0.00

PT Rimba Harapan Sakti * 140.82 0.05 0.00 0.00

Sub Total 11,122.89 4.08 0.00 0.00 Smallholders :

Koperasi Bita Maju Bersama 3,786.29 1.39 1,513.82 1.41

Independent Outgrowers :

1. I Wayan 1,071.80 0.39 457.75 0.43

2. Darmo Sumarto 317.91 0.12 0.00 0.00

Sub Total 1,389.71 0.51 457.75 0.43 TOTAL 272,615.88 100.00 107,544.00 100.00

PT Mustika Sembuluh Mill 2

Company owned estates :




Sub Total 92,994.62 66.57 48,796.00 100.00 Wilmar’s group estate :

PT Kerry Sawit Indonesia* 6,141.73 4.40 0.00 0.00

PT Sarana Titian Persada* 5,055.73 3.62 0.00 0.00

PT Rimba Harapan Sakti* 11.00 0.01 0.00 0.00

PT Bumi Sawit Kencana* 35,477.45 25.40 0.00 0.00

Sub Total 46,685.91 33.43 0.00 0.00 TOTAL 139,680.53 100.00 48,796.00 100.00

Note :

*). Period of January to June only because after June 2014 that receipt FFB status is tolling (MS1 & MS2 POM as

processing services).

1.7 Actual production volumes, tonnages and project ed outputs.

Table 4 : Certified tonnages claimed, certified tonn ages purchased or sold, total and projected CPO and PK production from PT Mustika Sembuluh Palm Oil Mill .



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Note :

* Data from January to December year 2014 in MS POM 1 & MS POM 2

** Data from January to December year 2014 in MS POM 1 (CPO : 59,349.87 MT & PK : 11,979.13 MT) with OER : 21.77% and KER : 4.39% & MS POM 2 (CPO : 31,637.64 MT & PK : 6,509.11 MT) with OER : 22.65% and KER : 4.66%

*** For Period of January to December year 2015 in MS POM 1 (CPO : 62,544 MT, PK : 12,379 MT) with OER : 24% and KER : 4.75% & MS POM 2 (CPO : 35,496 MT, PK : 7,025 MT) with OER : 24% and KER : 4.75% where these FFB come from MS1 estate : 178,500 mt, MS2 estate : 99,000 mt, MS3 estate : 88,400 mt, scheme smallholder estate : 4,800 mt, KSI1 estate : 8,300 mt, and BSK1 estate : 29,500 mt.

**** For Period of January to December year 2016 in MS POM 1 (CPO : 59,472 MT, PK : 11,770.50 MT) with OER : 24% and KER : 4.75% & MS POM 2 (CPO : 11,770.50 MT, PK : 8,481.13 MT) with OER : 24% and KER : 4.75% where these FFB come from MS1 estate : 156,900 mt, MS2 estate : 100,800 mt, MS3 estate : 91,500 mt, scheme smallholder estate : 4,300 mt, KSI1 estate : 1,400 mt, STP1 estate : 11,400 mt, STP2 estate : 2,900 mt and BSK1 estate : 57,150 mt

1.8 Dates of Plantings and Replanting Cycles The company follows a replanting cycle of 25 years. Information on the dates of plantings are as per the table below.

Table 5 : Age and year of plantings of company esta te supplying to PT Mustika Sembuluh Palm Oil Mill

Age & Year of Plant-ings

Oil palm planted area at each estate(ha)

MS 1 MS2 MS3 Total Plasma

2 yrs (2013) 0.00 0.00 31.10 31.10 0.00

3 yrs (2012) 21.31 0.00 33.37 54.68 0.00

4 yrs (2011) 24.94 0.00 29.47 54.41 0.00

5 yrs (2010) 20.18 0.00 179.67 199.85 0.00

6 yrs (2009) 12.99 0.00 215.99 228.98 0.00

7 yrs (2008) 51.23 0.00 119.72 170.95 38.83

8 yrs (2007) 0.00 0.00 697.43 697.43 143.18

9 yrs (2006) 0.00 1,844.54 1,068.02 2,912.56 0.00

10 yrs (2005) 0.00 1,935.09 1,641.33 3,576.42 0.00

11 yrs (2004) 1,289.67 1,878.57 0.00 3,168.24 0.00

12 yrs (2003) 2,474.66 0.00 0.00 2,474.66 0.00

13 yrs (2002) 1,017.97 0.00 0.00 1,017.97 0.00

14 yrs (2001) 1,124.53 0.00 0.00 1,124.53 0.00

Amount

CPO PK

Certified tonnages claimed (MT) 99,072.00 19,608.00

Certified tonnages sold (MT)* 0.00 11,851.05

Certified tonnages purchased (MT) 0.00 0.00

Actual Production (MT)** 90,987.51 18,488.24

Extraction rate (%)** 22.21 4.53

Projected output for year 2015 (MT)*** 98,040.00 19,404.00

Projection extraction rate (%)*** 24.00 4.75

Projected output for year 2016 (MT)**** 102,324.00 20,251.63

Projection extraction rate (%)**** 24.00 4.75



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Age & Year of Plant-ings

Oil palm planted area at each estate(ha)

MS 1 MS2 MS3 Total Plasma

15 yrs (2000) 56.92 0.00 0.00 56.92 0.00

TOTAL 6,094.40 5,658.20 4,016.10 15,768.70 182.01

There is no oil palm replanting activities planned until year 2025 since all palms are less than 15 years old.

1.9 Area of Plantation (Total, Planted and Mature)

Table 6: Oil Palm Planted Area Summary, FFB Producti on and Average yield/ha for PT Mustika Sem-buluh estates

Estate Name Total area

(ha)

Oil Palm Planted area

(ha)

Mature (Production)

area (ha)

Immature (Non-production)

area (ha)

FFB Production*

(tonnes)

Average yield/ ha

MS 1 6,590.20 6,094.40 6,048.15 46.25 159,617.41 26.39

MS 2** 6,107.59 5,658.20 5,658.20 0.00 154,939.61 27.38

MS 3 6,752.47 4,016.10 3,951.63 64.47 80,727.87 20.43 Koperasi Bita Maju Bersama 182.01 182.01 182.01 0.00 3,786.29 20.80

TOTAL 19,632.27 15,950.71 15,839.99 110.72 399,071.18 25.19 * Periode January to December 2014 ** FFB form MS2 estate deliver to MS1 mill and other mill under Wilmar International group

Table 7: Land use data for PT Mustika Sembuluh Plan tation

Estate Name Total area

(ha)

Oil Palm Planted Ar-

ea (ha)

HCV/

Poten tial HCV

areas (ha)

Land clear-ing area (ha)

Land used for other purposes (ha)

POM Land oc-cupation

Road, housing/ Drainage

Unplanted and non

Plantable

MS 1 6,590.20 6,094.40 99.09 0.00 22.94 52.91 309.57 11.29

MS 2 6,107.59 5,658.20 203.77 0.00 0.00 20.03 214.14 11.45

MS 3 6,752.47 4,016.10 1,227.40 0.00 14.41 728.66 202.11 563.79

Sub Total 19,450.26 15,768.70 1,530.26 0.00 37.35 801.60 725.82 586.53

Koperasi Bita Maju Bersama

182.01 182.01 0.00 0.00 0.00 0.00 0.00 0.00

TOTAL 19,632.27 15,950.71 1,530.26 0.00 37.35 801.60 725.82 586.53 Note : -

1.10 Progress Against Time Bound Plan

Table 8 : Time Bound Plan of the Other Management Uni ts

Name of Holding Location Time bound

plan for certification

Status

Indonesia

PT Milano (Pinang Awan) North Sumatra 2009 Certified

PT Mustika Sembuluh I Central Kalimantan 2009 Certified

PT Kencana Sawit Indonesia West Sumatra. 2010 Certified

PT Kerry Sawit Indonesia I Central Kalimantan 2010 Certified

PT Tania Selatan South Sumatra 2010 Certified



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Status

PT AMP Plantation West Sumatra 2011 Certified

PT Agro Nusa Investama (Sambas) West Kalimantan 2012 Certified

PT Buluh Cawang Plantations 1 South Sumatra 2012 Certified

PT Bumi Sawit Kencana Central Kalimantan 2012 Certified

PT Gersindo Minang Plantations West Sumatra 2012 Certified

PT Sarana Titian Permata Central Kalimantan 2012 Certified

PT Daya Labuhan Indah-2 North Sumatra 2013 Certified

PT Mustika Sembuluh 2 Central Kalimantan 2014 Certified

PT Mentaya Sawit Mas Central Kalimantan 2014 Certified

PT Kerry Sawit Indonesia 2 Central Kalimantan 2014 Certified

PT Agro Palindo Sakti 1 South Sumatra 2014 Full Assessment on 14/11/2014

PT Musi Banyuasin Indah South Sumatra 2014 Full Assessment on 28/11/2014

PT Murini Sam Sam Riau 2014 Full Assessment on 02/11/2015

PT Sinarsiak Dianpermai Riau 2014 Gap Assesment on 19/09/2014

PT Karunia Kencana Permaisejati Central Kalimantan 2016 Full Assessment on 09/04/2015

PT Rimba Harapan Sakti Central Kalimantan 2016 Full Assessment on 27/03/2015

PT. Bumi Pratama Khatulistiwa West Kalimantan 2016

PT Agro Nusa Investama (Landak) West Kalimantan 2016

PT Agro Palindo Sakti 2 West Kalimantan 2016

PT Buluh Cawang Plantation West Kalimantan 2015

PT Agrindo Indah Persada 2 Bangko - Jambi 2016

PT. Putra Indotropical West Kalimantan 2016

PT. Pratama Prosentindo West Kalimantan 2016

PT. Indoresin Putra Mandiri West Kalimantan 2016 PT Asiatic Persada Jambi 2013 Not classified, company

sold PT Citra Riau Sarana 1 Riau 2014 Not classified, shares are

being divested PT Citra Riau Sarana (ML) 3 Riau 2014 Not classified, shares are

being divested PT Citra Riau Sarana 2 Riau 2014 Not classified, shares are

being divested Malaysia

Sapi Palm Oil Mill Labuk, Sandakan Sabah

24 December 2013

Certified

Reka Halus Palm Oil Mill Labuk, Sandakan Sabah

24 December 2013

Certified

Sabahmas Palm Oil Mill Lahad Datu, Sabah 6 June 2014 Certified

Saremas 1 Palm Oil Mill Miri, Sarawak 14 June 2015 Certified

Saremas 2 Palm Oil Mill Miri, Sarawak 14 June 2015 Certified

Terusan Palm Oil Mill Labuk, Sandakan Sabah

7 September 2010

Certified



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Status

Ribubonus Palm Oil Mill Telupid, Sandakan, Sabah

7 September 2010

Certified

Sri Kamusan Palm Oil Mill Sugut, Sandakan Sabah 13 May 2010 Certified

Table 9: New Development Area under Wilmar Internatio nal

Name of Holding Location Total area NPP Status according to

RSPO NPP procedure

PT Agro Indah Persada Merangin. Jambi 1,200 ha Approved

PT Agro Nusa Investama Sambas

Sambas, West Ka-limantan

1,024 ha Approved

Biase Plantations (Ibiae Estate)

Calabar, Nigeria 5594 ha Approved

Biase Plantations (Calaro Extension)

Calabar, Nigeria 3066 ha Not submitted (Pending HCV/HCS study

Eiyup Industry (Oban Es-tate)

Calabar, Nigeria 2986 ha Not submitted (Pending HCV/HCS study

Biase Plantations (Biase estate)

Calabar, Nigeria 8029 ha Overlapping boundaries

1.11 Compliance to Rules for Partial Certification

Compliance of the uncertified management units of Wilmar Plantation Limited against the rules for partial certifi-cation according to RSPO Certification System clause 4.2.4 was assessed by submission self assessment re-port. A summary of findings is as stated below.

Partial Certification Requirements Audit Findings

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

PT Mustika Sembuluh is subsidiary of Wilmar Interna-tional Indonesia is RSPO member with membership number 2-0017-05-000-00.

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

Any revision to the time-bound plan or to the circumstances of the company shall cause

See table above, some changes on company’s time bound plan due to several reason explained above.



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

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

There are some newly developed plantation areas un-der Wilmar International such as in Jambi province, West Kalimantan province Indonesia and Nigeria as explained on the table 9 above. Some areas have un-dergone the New Planting Procedure (NPP) and been approved while some areas are still undergoing the NPP, as shown in Table 9 above.

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

PT Asiatic Persada, which was previously a subsidiary of Wilmar had a significant land conflict issue but has been sold to other plantation company and is now no longer a subsidiary of Wilmar Plantation.

Wilmar International carried out the New Planting Pro-cedure for BIASE Plantation Limited (Ibiae estate) in Nigeria with an announcement made on the RSPO website on 9 November 2012. During this NPP pro-cess, a complaint was submitted by the Rainforest Resource & Development Centre (RRDC) on behalf of the Ibiae Land Lord Community. The complaint cov-ered infringements to several aspects of Principle 1 and Principle 2 of the RSPO P&C. The case was tak-en up and investigated by the RSPO Complaints Pan-el, with decision made for RSPO to a lawyer well ac-quainted with Nigerian laws to review and give an au-thoritative opinion on whether the company had com-plied with the legal requirements of Nigeria. The legal opinion was received by the RSPO on 27 August 2014, and based on this opinion, the RSPO confirmed that BIASE Plantations was in compliance with legal requirements and closed the case. However, the result was not accepted by RRDC as well as the NGO, Friends of the Earth and the issue remains ongoing with no resolution. As the company has complied with requirements to attempt to resolve the dispute through the RSPO grievance procedure, this is noted by the TUV Rheinland audit team as an observation and pro-gress of the case will be monitored.

Further details on this case is available here: http://www.rspo.org/members/complaints/status-of-complaints/view/26

There is also on ongoing land dispute at PT Gersindo Minang Plantation (GMP), West Sumatra under Wil-mar, which has been ongoing since year 1997 with the village of Jaorang Rantau. This company has been RSPO certified by another certification body who is monitoring the status of the dispute with the RSPO.

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

A previously ongoing labour conflict in Tania Selatan regarding employee bonus was temporarily resolved, however based on new information received from the Manpower and Transmigration Department, the dis-pute is still ongoing. The dispute is still being managed



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according to the company’s conflict resolution mecha-nism with status being monitored during annual sur-veillance audit by TUV Rheinland.

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

Some of Wilmar’s other management units have not complied with certain legal requirements, for example in PT Sarana Titian Permai, PT Kerry Sawit Indonesia, PT Mustika Sembuluh estate under another Wilmar In-ternational management unit, there is an issue with the land area stated in the land use right certificate (HGU). However, the company is taking action by inviting the National Land Agency (BPN) to remeasure the land and resolve the issue. The process is still ongoing.

In addition, there were non-compliances raised in June 2015 by the Environmental Department of Agam against PT AMP Plantation, another subsidiary of Wilmar. The non-compliances raised were that:

- The company continued to carry out land applica-tion after their license for land application had ex-pired on 14 March 2014

- The company was carrying out POME treatment us-ing an adsorption system which had not been stud-ied or approved as per the company’s environmen-tal management document

- There was no follow up by the company’s man-agement on the results of the evaluation by the Agam district on PT AMP mill’s wastewater treat-ment facility in 2013

- Sample analysis results of wastewater discharged from the mill was found to have exceeded the legal limits for BOD and COD.

At time of this audit, the company was still making ef-forts to close these legal non-compliances.

1.12 Progress of associated smallholders or outgrow ers towards RSPO compliance:

The company has a smallholder scheme (Koperasi Bita Maju Bersama), that supplied FFB to their mill and include

of the scope of audit since 30 January 2015 (RSPO certificate no. 824 502 14009).

1.13 Approximate Tonnages Certified

The tonnages certified have been revised from the previous amount stated in the RSPO certificate issued because the previous certified volume was not appropriate with the volume of FFB production at current time. Based on pro-jection of the volume of FFB production year 2016 from company owned estate (Mustika Sembuluh 1-3 estate) is 412,800 mt (include FFB from MS2 estate will be processes in KSI2 mill amount of 59,300 mt) and the cooperative of Bita Maju Bersama is 4,300 mt with extraction rate are 24% (OER) and 4.75% (KER). Approximate tonnages cer-tified are as follows :

Crude Palm Oil (CPO) : 99,072.00 MT

Palm Kernel (PK) : 19,608.00 MT



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2.0 ASSESSMENT PROCESS

2.1 Certification Body PT TUV Rheinland Indonesia is member of Group TÜV Rheinland Group, a global leader in independent test-ing and assessment services. The TÜV Rheinland Group was established in 1872 with offices located in over 500 locations in 65 countries on all five continents. PT TUV Rheinland Indonesia offers certification for a wide range of management systems according to established international standards including ISO 9001, ISO 14001, OHSAS 18001, SA 8000, RSPO (RSPO-ACC-013) and ISPO (LS-P&K-005-ISPO). PT TUV Rheinland Indo-nesia office is located in Jakarta, Indonesia.

2.2 Qualifications of Lead Assessor and Assessment Team The assessment team members of this surveillance audit that were part of the same assessment team for the previous surveillance audit are as follows: 1) Hendra Fachrurozy

2) Andi K Lubis

Name Position Qualifications / Experience

Harso Yuli An-tena Auditor

Education : Bachelor of Agriculture (social and economic of agriculture) – Bogor Agriculture University. Trainings attended : ISO 9001:2008 Lead Auditor training – TUV Rheinland Indonesia, Sustainable Forest Management training –Forest education and training center, ISPO training - Commission of ISPO. Working experience : Social research – Indonesian Centre for Agricul-tural (Social Economic and Policy Studies) since 2003-2007, Social Re-searcher – CSR Indonesia since 2007-2010, Social Economic Expert – Mott MacDonald Indonesia since 2010-2011, Personal consultant in re-search and development – Colors Media Group since 2011-2013, RSPO & ISPO auditor at TUV Rheinland Indonesia since 2013 -present.

Naik Monang Par-lindungan Lingga

Auditor

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

2.3 Assessment Methodology & Agenda The surveillance assessment combined with supply chain certification assessment was conducted on June 29 to July 04, 2015 as per the assessment program below. The assessment was carried out in accordance with TUV Rheinland Indonesia’s RSPO audit procedure as well as the RSPO Certification Systems document and RSPO Supply Chain Certification Systems document. During assessment, the qualified TUV Rheinland asses-sors used the RSPO standard as endorsed for the country in which the assessment took place and recorded their findings.

Due to the location and proximity of the estates, combined with common management systems, it was possible to carry out both field and document assessments of all estates and the mill within the time frame without com-promising the integrity of the assessment in anyway.



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All 3 estates, 2 mill and 1 smallholder were visited and the assessment team carried out field and document assessments of compliance to selected RSPO principles and criteria. Common systems were identified and specific evidence was recorded for individual estates. Interviews were conducted at all estates and the mill.

The company proposed the correction and corrective action for all identified non conformities raised and docu-mented evidence of closure of all major non-conformities to the certification body (CB) within 60 days from the last day of audit or the closing meeting. Whereas, minor non-conformities will be verified on the next surveil-lance audit. The surveillance assessment agenda is as explained below. Recertification Audit Agenda.

Date Location/ Main sites

Main activities

29 June 2015

Regional office

• Opening Meeting • Verification for previous audit findings • Verification document PT Mustika Sembuluh

30 June 2015

MS estate and co-

operative

• Stakeholder consultation • Verification document : Agriculture Manual & Standard Operating Procedure for Oil

Palm Tahun 2011, Prosedur Standard Keselamatan Kerja (PSKK), SOP Agrono-my/EMU, fertilizer application records, IPM implementation record, Spraying activi-ty/Chemical Application Record, Harvesting Record, Result of Leaf and Soil Analy-sis, Calibration Record, Road maintenance record, Training Record.

01 July 2015

MS estate and co-

operative

• Document Review: Agriculture Manual & Standard Operating Procedure for Oil Palm Tahun 2011, Prosedur Standard Keselamatan Kerja (PSKK), SOP Agrono-my/EMU, fertilizer application records, IPM implementation record, Spraying activi-ty/Chemical Application Record, Harvesting Record, Result of Leaf and Soil Analy-sis, Calibration Record, EFB application record, Road maintenance record, MCU Record, Training Record, License/Permit related environmental aspect, Hazardous Waste and waste management

• Verification to field : Land Aplication, Fertilization activity (Blok 90), clinic, Spraying Activity (Blok 052/053), Harvesting Activity (Blok 039), Fertilization activity (Block 014), Pruning Activity ((Blok 913), PPE Storage, Warehouse Transit, Central Office Activity (Hazardous Waste Temporary Storage, Hazardous Material Storage, Ferti-lization Activity (Blok 032), EFB Application (Block 138), Erosion Monitoring Points, Peat Area

• Interview : ….

02 July 2015

MS 2 mill

• Verification document : Standard Operation Procedure Safe Palm Oil Mill, Streliza-tion Section Logsheet, Pressing Station Log Sheet, Clarification Station Journal, Cleaning Tank Record, Calibration Record, Training Record, License/Permit related environmental aspect and reported to Government, Hazardous Waste and waste management

• Verification to field : Process, Hazardous Waste Temporary Storage, Water Treat-ment Plant, Diesel Storage Tank, Hazardous Material Storage, POME, Land Appli-cation.

• Interview :

03 July 2015

MS 1 mill

• Verification document : Standard Operation Procedure Safe Palm Oil Mill, Streliza-tion Section Logsheet, Pressing Station Log Sheet, Clarification Station Journal, Cleaning Tank Record, Calibration Record, Training Record, License/Permit related environmental aspect and reported to Government, Hazardous Waste and waste management.

• Verification to field : Process, Hazardous Waste Temporary Storage, Water Treat-ment Plant, Diesel Storage Tank, Hazardous Material Storage, POME, Land Aplica-tion

• Interview : 04

July 2015

Regional office

• Preparing of closing meeting • Closing meeting



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3.0 ASSESSMENT FINDINGS 3.1 Summary of Findings pertaining to RSPO Principle s & Criteria

During this re-certification audit, there are 18 nonconformities were assigned against 12 nonconformities Major Compliance (9 major findings against RSPO P&C and 3 major finding against RSPO SCCS) and 6 nonconformities Minor Compliance Indicator. Futher explaination of the non-conformities raised and corrective actions taken by the company are provided in Section 3.3. The observations & opportunities for improvement are listed in Appendix 3 .

The following is a summary of findings made for the criteria listed in the RSPO Principles & Criteria Indonesian National Interpretation year 2008 and RSPO SCCS, 2011

• RSPO P&C

Principle 1: Commitment to transparency

Criteria 1.1 Growers and millers provide adequate in formation to relevant stakeholders on environ-mental, social and legal issues relevant to RSPO Crit eria, in appropriate languages and forms to allow for effective participation in decision making Findings :

There are no changes to management commitment to transparency as stated in management letter dated 16 March 2009 on transparency of company information and it has procedures to provide information to external parties (transparency) with the document number SOP 47 / PR / (1) / 2011, revision 1 February 2011 made by PR Manager and approved by the General Manager. This procedure purpose to ensure that estate and mill to provide information in the correct and adequate language for the interest of stakeholders regarding the en-vironmental issues, social and legal. In the procedure has also been set up procedures for the entry of public information requests that can be done by email, letter, telephone or office Sampit.

The procedure also regulates that the information can be obtained with extensive and information that can be accessed with the approval of the General Manager. CSR Section and the Department of Development Part-ners will provide a response to current request period of 14 calendar days after the request is received.

The company also provides RKL-RPL and UKL-UPL reports to local governments periodically which in the report contained the information of environmental, social, legal and other information related to estate and mill operational.

Mustika Sembuluh estate has made a recording of the list of incoming and outgoing letters from 2014 and 2015. For example :

1. Incoming letter from the Pondok Damar village dated February 3, 2014 with the number of letters: 89 / PDM-MHU / Ur-Pem / II / 2014 regarding the cutting of trees on the PLN network. The company respond-ed to the incoming letter dated March 11, 2014 with the number of letters: 03 / MS / Adm / BM / III / 2014 regarding the confirmation letter. The company responds the incoming letter over the time limit regulated in the procedure of provide information to external parties (transparency) period of 14 calendar days after the incoming letter is received.

2. Incoming letter from the Pondok Damar village dated May 20, 2014 with the number of letters: 68 / PDM-MHU / Ur-Pem / 2014 regarding the meeting of scheduling agenda with the management of the PT. Mus-tika Sembuluh. The company responded to the incoming letter dated June 6, 2014 with the number of let-ters: 13 / BM-MS / VI / 2014 regarding the request of facilitating meetings with Pondok Damar Village community at the District Office Mentaya Hilir addressed to the Head of North Mentaya Hilir forwarded to the Head of the Pondok Damar Village, Senior Manager of Development Partners, GEM PT. MS, EM PT. MS-2.

The mill-1 has made the log book of incoming letter from the years 2011-2015 but does not have record of the response to the incoming letter which in the procedure provision of information to external parties (transpar-ency) regulated companies provide a response to incoming letter period of 14 calendar days after the incom-ing letter is received. Whereas, The mill-2 has made the log book of incoming letter from the years 2013-2015. In 2015, there is no incoming letter to the mill.

Bita Maju Bersama Cooperative has made log incoming and outgoing letter. Incoming letter to the cooperative is related to the pricing of fresh fruit bunches while outgoing letter is related requests for payments to the



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company.

Compliance status : Full Compliance Criteria 1.2 Management documents are publicly avail able, except where this is prevented by com-mercial confidentiality or where disclosure of info rmation would result in negative environmental or social outcomes Findings :

The company has procedures to provide information to external parties (transparency) with the document number SOP 47 / PR / (1) / 2011, revision 1 February 2011 made by PR Manager (Mr. Amantoharjono) and approved by the General Manager (Tan Tong Sing). In the procedure regulated for a list of documents that can be accessed extensive and a list of documents that confidential and require the approval of the General Manager.

The list of documents with extensive access such as (1) EIA documents, (2) the company's annual report, (3) the policy of the company, (4) HGU permits and other relevant permits, (5) the production of estate and mill monthly reports, (6) total area of estate and mill operations complemented to the map, (7) a map of the river contained in the plantation areas, (8) the procedures / operational procedures of estate and mill, (9) the or-ganizational structure of the company, (10) reports of HCV and Management Plan, (11) report Social Impact Assessment (SIA), (12) magazines and bulletin of company, (13) reports of investment activities (LKPM), (14) reports the plantation business activities (LKUP), (15) monitoring statistics plantation, (16) the data of em-ployees of the company, (17) data use of foreign workers (expatriates), (18) land use data, (19) CPO sales data, (20) the plasma production data, (21) the implementation of the CDP and CSR and (22) SOP of Estate and Mill.

The data can be accessed with the approval of the General manager such as (1) title certificate and change of status of the company certificate, (2) the profit / loss of companies, (3) the balance of the company, (4) sal-ary staff / employees, (5) the identity of the shareholders and the management of the Company, (6) the identi-ty of operational leadership, staff and employees, (7) the list of assets of the company, (8) a list of land / plan-tation land, (9) plan community development (community development), (10) land acquisition payment data, (11) complaints and complaints, (12) map of the distribution of rare animals in the conservation area, (13) use data of the plasma funds, (14) 3rd party donations.

Retention time for record of incoming and outcome letter has defined for at least for five (5) years in the com-pany and cooperative.

Compliance status : Full Compliance Criteria 1.3 Growers and millers commit to ethical c onduct in all business operations and transactions Findings :

PT Mustika Sembuluh does not have a written policy that contains a commitment to the code of integrity and ethical conduct in all of operations implementation and transaction must be documented and communicated to all levels of employees and operations. It a condition above was raised as Nonconformities (NCR No. 2015-01 of 18 ).

Compliance status : Non Compliance

NCR No.2015-01 of 18 (Indicator 1.3.1 as Minor non-conf ormity)

PT Mustika Sembuluh does not have a written policy that contains a commitment to the code of integrity and ethical conduct in all of operations implementation and transaction must be documented and communicated to all levels of employees and operations.

Principle 2: Compliance with applicable laws and reg ulations



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Criteria 2.1 There is compliance with all applicable local, national and ratified international laws an d regulations

Findings :

The company has the identification rule of law and legislation procedure and mechanisms of ensuring that compliance with applicable legal requirements and related to the SOP document number 08 / CKP / (2) / 0111 revision 2 January 2011 made by the Senior Legal and Contract Officer and General Manager.

The company has a list of laws and the latest regulation (include of scheme smallholder) include :

• List of laws and regulations in the environmental area with a number of documents: Form 02 / SOP 08 / CKP / (2) / 0111 revision 10 effective date May 1, 2015 prepared by the Environment Officer, inspected by Legal Officer and approved by the General Manager. It has included such as Law no. 19 year 2009 re-garding ratification of Stockholm Convention On Persistent Organic Pollutans, Regulation government no.81 year 2012 regarding management of domestic waste and waste as similar domestic waste, Envi-ronmental Agency decree no.5/2012 regarding type of business plan and or activities which mandatory of environmental impact analyst and Environmental Egency decree no.14 year 2013 regarding symbol and label of hazardous & toxic waste.

• A list of rules and regulations related plantation company with a number of documents: Form 02 / SOP 08 / CKP / (2) / 0111 revision 10 effective date May 1, 2015 prepared by the Legal Officer, inspected by the Regional Binamitra and approved by the General Manager.

• A list of rules and regulations related to occupational safety and health with a number of documents: Form 02 / SOP 08 / CKP / (2) / 0111 revision 10 effective date May 1, 2015 and prepared by the Safety Officer, inspected by Legal Officer and approved by the General Manager.

• A list of rules and regulations related to employment with a number of documents: Form 02 / SOP 08 / CKP / (2) / 0111 revision 10 effective date May 1, 2015 and prepared by the Human Resource Region, in-spected by the Legal Officer and approved by the General Manager.

The list of laws and regulations above will be re-updated on November 1, 2015.

The auditee several evidences of compliance with applicable local, national and ratified international laws and regulations as example : • There was evidence of “BPJS Kesehatan & BPJS Ketenagakerjaan” fee payment period of June 2015, • OSH committee in MS estate and MS-1 mill has approved by local government so the company has com-

plied with Minister of Man Power regulation No.Per.04/MEN/1987. • Boiler, crane, wheel loader, backhoe, excavator operator in both mills has operator permit letter for OSH

license so the company has complied with Minister of Manpower and Transmigration decree no. PER.09/MEN/VII/2010 dated on July 13, 2010.

• etc

but there are still several conditions not compliances with regulation where were found during surveillance audit as example :

• PT Mustika sembuluh was not showed update documentation regarding change of forest areas process amount of 5,227 Ha.

• Structure of organization of OSH committee at Mustika Sembuluh 2 mill has not been approved by local government. It condition not compliance with Ministry of Labour regulation No.PER.04/MEN/1987 article 3 paragraph 3.

• No evidence that Bipartite Cooperation Institution (LKS Bipartit) at Mustika Sembuluh 2 mill has not been announced to local government so it was non-complaince with Minstry of Labour and Transmigration regu-lation No.PER.32/MEN/XII/2008 article 9.

• Hazardous and toxic containers have not been putted symbols which appropriate with type and clasifica-tion of hazardous and toxic product so it condition was non-compliance with Environmental Agency regula-tion no.3 year 2008.

• Hazardous and toxic product symbol in each hazardous and toxic product storage location not available so it condition not compliance with Environmental Agency regulation no.3 year 2008 article 3.

• The symbol of hazardous and toxic waste on their container and hazardous and toxic waste storage loca-tion not available so it condition non-compliance with Environmental Agency No.14 year 2013 article 2 paragraph 2.



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• Mechanism of printing hazardous and toxic waste and labeling hazardous and toxic waste was not appro-priate with Environmental Agency No.14 year 2013 article 7 (attachment).

The condition above was raised as non-conformity (NCR No.2015-02 of 18 ).

The company has effored to revision of permit such as Revision of environmental report (Dokumen Evaluasi Lingkungan Hidup (DELH)) about increase of production capacity in mill (become of 120 tonnes FFB/hours), Revision of bussiness plantation permit (IUP) on behalf PT Mustika Sembuluh (include estates and MS-1 mill) so the company has compliance to Minister of Agriculture decree no. 26 year 2007 jo no.98 year 2013, etc.

The company has evaluated the company's compliance with all regulations, especially the latest regulations conducted on 20-22 April 2015. The company has included the evaluated regulations in the list of regulations and legislation both related to the plantation company activities, safety and occupational health, employment and environment.

The legislation to be evaluated, example :

• Regulation of the Minister of Agriculture of the Republic of Indonesia No. 11 / Permentan / OT.140 / 3/2015 concerning the system of certification of sustainable palm oil Indonesia (Indonesian Palm Oil Certi-fication System / ISPO)

• Additions to the Central Kalimantan Governor Decree 41 of 2014 regarding the Management of High Con-servation Values in the plantation business in Central Kalimantan province.

• Law No. 19/2009 concerning Ratification the Convention on Persistent Organic Stockhol Pollutans (Stock-holm Convention on persistent organic pollutants)

• Government Regulation No. 81 of 2012 on the management of household waste and household-like waste.

• Regulation of the Minister of Environment No. 5/2012 on the type of business and / or activities that are mandatory environmental impact assessment

• Regulation of the Minister of Environment No. 14 of 2013 concerning symbols and labeling of hazardous and toxic waste

• Regulation of the Minister of Environment No.3 year 2008 regarding symbols and labelling of hazardous and toxic product

The Ministry of Forestry regulation no.P.32/Menhut-II/2010 jo P.41/Menhut-II/2012 was not included/available so furthermore understading about its complainces. This was raised as non-conformity (NCR No.2015-03 of 18).

The company also carries out evaluations of compliance to applicable local, national and ratified international laws but there is evidence that two of them regulation not appropriate with existing condition such as Envi-ronmental Agency regulation no.3 year 2008 and no.14 year 2013. This is condition was raised as non-conformities (NCR P&C No.2015-04 of 18 ).

The company has a system to record any changes in the law where the Legal Officer responsible for identify-ing, creating, updating and conduct periodic audits (two times a year) for a list of legislation, licensing, permit requirements and conditions of the applicable requirements of the license relating to estate and mill opera-tions.


NCR No.2015-02 of 18 (Indicator 2.1.1 as Major non-conf ormity)

There are still several conditions not compliances with regulation where were found during surveillance audit as follows :



• No evidence that Bipartite Cooperation Institution (LKS Bipartit) at Mustika Sembuluh 2 mill has not been announced to local government so it was non-complaince with Minstry of Labour and Transmigration reg-ulation No.PER.32/MEN/XII/2008 article 9.



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• Hazardous and toxic containers have not been putted symbols which appropriate with type and clasifica-tion of hazardous and toxic product so it condition was non-compliance with Environmental Agency regu-lation no.3 year 2008.




Inside the list of laws and regulations (law register) relate of plantation (form no.02/SOP 08/CKP/(2)/0111 rev.10 dated on 1 May 2015) that Ministry of Forestry regulation no.P.32/Menhut-II/2010 jo P.41/Menhut-II/2012 was not been evaluated or analysed by company so the company not understand what has complied or not.


The company also carries out evaluations of compliance to applicable local, national and ratified international laws but there is evidence that two of them regulation not appropriate with existing condition such as Envi-ronmental Agency regulation no.3 year 2008 and no.14 year 2013.

Criteria 2.2 The right to use the land is demonstrat ed, and is not legitimately contested by local peop le who can demonstrate that they have legal, customary or user rights

Findings :

In the re-certification audit, land use right (HGU) concession certificates are still same as before with total ar-ea of 19,450.26 Ha. The HGU licenses held by Mustika Sembuluh today are as listed below : • Land use right (HGU) certicate No. 14 dated 4 June 2007 (NIB : 15.11.04.09.00014) with basic of registra-

tion is decision letter from head of National Land Agency No.2-HGU-BPN-RI-2007 dated 7 February 2007 valid for 30 years (until 7 February 2037) for areas of 1,990.32 ha located in Bangkal village, Danau Sem-buluh Sub District, Seruyan District. Measurement letter No. 14/Seruyan/2007 come from cadastral map No.07/2005 dated on 10 Agustus 2005. Decision letter from the head of National Land Agency (BPN) No.2-HGU-BPN-RI-2007 has been available.

• Land use right (HGU) certificate No. 36 dated 29 May 2007 with basic of registration is decisioin letter from head of National Land Agency No. 3-HGU-BPN-RI-2007 dated 7 February 2007 valid for 25 years (until 07 February 2037) for area of 5,169.28 ha located in Pondok Damar village, Mentaya Hilir Utara Sub District, East Kotawaringin district. Measurement letter No. 30/Kotim/2007 come from cadastral map No.08/2005 dated on 10 Agustus 2005. Decision letter from the head of National Land Agency (BPN) No. 3-HGU-BPN-RI-2007 has been available.

• Land use right (HGU) certificate No. 10 dated 30 June 2005 with basic of registration is decision letter from head of National Land Agency No.8/HGU/BPN/2005 dated 18 February 2005 valid for 30 years (until 30 June 2035) for area of 5,227.00 Ha located in Bangkal & Sembuluh village, Danau Sembuluh Sub District, Seruyan District. Measurement letter No. 10/Seruyan/2005 come from cadastral map No.02/2004 dated on 30 March 2004. Decision letter from the head of National Land Agency (BPN) No. 8/HGU/BPN/2005 has been available.

• Land use right (HGU) certificate No. 16 dated 27 June 2001 with basic of registration is decision letter from head of National Land Agency No.01/540/HGU-BPN-42/2000 dated 23 September 2000 valid for 30 years (until 23 September 2030) for areas of 166.3055 Ha located in Bangkal & Tanah Putih village, Danau Sembuluh & Kota Besi Sub District, East Kotawaringin District. Measurement letter No. 09/Kotim/2000 come from cadastral map No.1/2000 dated on 26 July 2000 and No.2/2000 dated on 26 July 2000. Deci-sion letter from the head of National Land Agency (BPN) No.01/540/HGU-BPN-42/2000 has been availa-ble.

• Land use right (HGU) certificate No. 20 dated on 27 September 2002 with basic of registration is decision letter from head of National Land Agency No.03/540/HGU/BPN.42/2000 dated on 30 December 2000 & No.01/540/HGU/BPN.42/2002 dated on 22 August 2002 valid for 30 years (until 27 September 2032) for area of 144.88 ha located in Bangkal village, Danau Sembuluh Sub District, Seruyan District. Measure-



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ment letter No. 13/Kotim/2002 come from cadastral map No.9/2000 tanggal 18 December 2000. Decision letter from the head of National Land Agency (BPN) No. No.03/540/HGU/BPN.42/2000 & 01/540/HGU/BPN.42/2002 has been available.

• Land use right (HGU) certificate No.52 dated 16 August 2011 (NIB : 15.05.00.00.00053 & 15.05.00.00.00054) with basic of registration is decision letter from head of National Land Agency No. 30/HGU/BPN RI/2011 dated 27 June 2011 valid for 35 years (until 27 June 2046) for areas of 563.67 ha located in Tanah Putih village, Telawang Sub District, Kotawaringin Timur District (MS3). Measurement let-ter No. 1/Kotim/2011 come from cadastral map No.07.15-05-2009 (294.91 ha) & 08.15-05-2009 (268.76 ha) dated on 14 July 2009. Decision letter from the head of National Land Agency (BPN) No. 30/HGU/BPN RI/2011 has been available.

• Land use right (HGU) certificate No.53 dated on 16 August 2011 (NIB : 15.05.00.00.00049) with basic of registration is decision letter from head of National Land Agency No. 29/HGU/BPN RI/2011 dated on 27 June 2011 valid for 35 years (until 27 Juni 2046) for areas 6,188.80 ha located in Tanah Putih village, Telawang Sub District, Kotawaringin Timur District (MS3). Measurement letter No. 3/Kotim/2011 come from cadastral map No.28/1997 dated on November 1997. Decision letter from the head of National Land Agency (BPN) No. 29/HGU/BPN RI/2011 has been available

Although Land use right (HGU) certificate No.10 with SK No.8/HGU/BPN/2005 has been issued on 18 Febru-ary 2005 by National Land Agency (BPN), but based on appendix of Ministry of Forestry decree no.SK.292/Menhut-II/2011 dated on 31 May 2011 regarding revision of function as forest area to non forest areas that one of PT Mustika Sembuluh areas amount of ± 5,227 Ha was indicated as conversion production forest (HPK) and therefore the company continues to make efforts to extrication from the forest area with mechanism under Government Regulation No.10 year 2010 jo No.60 year 2012 and Ministry of Forest Decree No. P.33/Menhut-II/2010 (procedures of the extrication of conversion production forest (HPK) areas). The or-ganization/company has sent a letter to the MoF (letter no.362/MUS/leg-Lcs/JKT/I/2013 dated on 2 January 2013) but some requirements are still needed in letter no.S.172/VII-KUH/4/2013 dated on 20 May 2013 from Ministry of Forestry.

Whereas, based on Ministry of Forestry decree no.SK.529/Menhut-II/2012 dated on 25 September 2012 re-garding revision of forest areas on Central Kalimantan that one of PT Mustika Sembuluh areas amount of ± 5,227 Ha was indicated as production forest (HP) and therefore the company continues to make efforts to ex-trication from the forest area with mechanism under Government Regulation No.10 year 2010 jo No.60 year 2012 and Ministry of Forest Decree No. P.32/Menhut-II/2010 jo P.41/Menhut-II/2012 (procedure of the forest exchange area (tukar menukar kawasan)). The organization/company has sent a letter to Head of Kutai Barat District (letter no.346/MS/LCS/IV/SK/2013 dated on 18 April 2013) regarding request of location to convert from non forest areas to forest areas and Head of Kutai Barat has responsed recommended for previous letter from company on letter no.503/511/DK-TU.P/IV/2013 dated on 19 April 2013 that their location in Long Bangun Sub District – Kutai Barat District, East Kalimantan Province (1150 17’ 48” BT to 1150 25’ 48 BT and 000 40’ 02” LU to 000 45’ 55” LU) or Sub Watershield of Mahakam Hulu on Watershield of Mahakam. The noxt step, the company has submitted request of letter to Governor of East Kalimantan (no.063/MS/LCS/II/2014 dated 3 February 2014) regarding request of recommendation for substitute areas. During recertification audit, the company could not showned update information regarding the forest ex-change areas process. This was raised as non-conformity above.

The company has understood the Procedures on Functions Appropriation Changes in Forest Areas with evi-dence in form of resume or flow chart which explaining step by step each regulations.

Smallholder farmer group who contribute to the mill of Mustika Sembuluh has included scope of audit. This smallholder group is under Mustika Sembuluh management according to plasma system and therefore would be considered as a part of Mustika Sembuluh unit, not as independent smallholder. This plasma area located adjacent to Mustika Sembuluh 2 estate with total area 182,01 Ha owned by 125 farmers . All farmers are member of Bita Maju Bersama cooperative and will be operated through that cooperative.

The cooperative has submitted request of principle permit for smollholder location to Head of Seruyan district (No.001/BMB-PD/IV/2013 dated on April 20, 2013) and to Head of Kotawaringin Timur district (no. 001/BMB-PD/III/2013 dated on March 14, 2013). The cooperative submit request of permit to both local government because it areas not clear in territory of the Seruyan district or Kotawaringin Timur district. Based on the con-dition it so legal permit that belong to the farmers is certificated of land (Surat Keterangan Tanah (SKT)) is-sued by head of village Pematang Limau, Sub-District of Seruyan, Seruyan District, dated on 22 November 2013, and has been registered by BPN (National Land Agency). Bita Maju Bersama cooperative have con-tinued to the next stage for the issuance of land title. This effort proved by a request letter to BPN dated on 4 April 2014. During surveillance audit that National Land Agency (BPN) has responded where there are form



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and statement letter which shall fill in by all members. Additional requirement will be filled in by all members in annual member meeting.

Based on field checking, boundary markers installed properly based on cadastral map which issued by Na-tional Land Agency (BPN), and there are several monitoring report on markers boundary periodically. The most recent monitoring was taken in June 2015, and all the markers are reported in good condition or have repairs and changes/reposition boundry stone. Based on verification in field that boundary stone no.39C at MS3 estate was good condition.

The company provided plasma boundary map with demarcation markers drawn along the edge boundary. Shape of boundary drawn based on field survey measurement that carried out in order to gain land. In the minutes field measurements are not included representatives of landowners. As observation; instead, the name of the land owner should be included in the minutes. The results of boundary pillars monitoring period June 2015 at smallholder areas that these all pillars in good condition.

Total of 35 temporary markers has been installed in the field in accordance with the coordinate in map, and will be replaced with the permanent markers after BPN measurement. Overlaid map between plasma estate and forest status designation map from MoF (SK 942/Menhut-II/2013) shows the area is within Other Use Purposes /APL (non-forest status).

During this re-certification audit, there are some issues raised up while stakeholder consultation regarding land dispute and company’s compliance to regulations. According to local head of villages, PT MS has closed community access main road that own by local government. There are two access main roads that have been closed, in MS3 and MS2. Document and field check found that the government road over MS3 es-tate has been revitalized by the company. Some spots need more efforts because of the actual conditions has been planted by local communities.

Interview result with local head of community found that there will be no problem with local community who planted some spots along the main road if company keep open coordination with local formal and traditional head villages. Field check on local government road over MS2 estate found that the main road still exist in un-maintained conditions. There is a river across the road and there is no bridge connecting the road. Based on interview result with local villagers, the road has out of order for a long time. Local government never con-duct any maintenance activities to keep the road in order. The road looks like abandoned for a long time, there are so many wild grasses grow over the road, local community still can’t use the road. This finding is rise as observations, company should make a progressive program (consulted with local formal and traditional head of communities) to revitalise the government road over MS3 estate detail with periodical agreed target completions.

There are some spots of HGU areas have been claimed by local communities. They build worshipping houses inside the planted area and claimed the locations as own by them. Company has registered all of the land dispute issues and open communication with the claimers. Some of cases, negotiation and resolving process have involving local Head of Customary Body (known as Damang). Interview result with local traditional vil-lage found that not all of land claim are valid. But, they underlined that company must still respect the wor-shipping house that made by the claimer, and make a local border about 2 metres square around the building.

Field check in some claim spots in MS3 and MS2 found that company still give respects to worshipping build-ing that build by the local community. One of them has been taken apart by and under authority of local Head of Dayak Customary Body (Damang). All of records regarding the process are available during this recertifi-cation audit. Interview results with the related person found that he has the authority based on Governor De-cree regarding Dayak Customary Institutions. All of the process still following regulations, both formal and traditional regulations. Checking to the document of law register found that the company not yet involving this regulation into the list. This finding rise as observation .

Compliance status : Compliance with observation

Criterian 2.3 Use of the land for oil palm does not d iminish the legal, customary or user rights of othe r users without their free, prior and informed consen t

Findings :

Company has develop maps in order to provide information regarding HGU area overlay with acquisitioned land and customary land inside HGU boundary that has not been acquisitioned. The maps available in a var-



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ies scale, 1:40.000 to 1: 10.000, depend on the objects. The maps that has been showed were: a. Location Map of Village Road, June 30th 2015, scale 1:40.000. This map has been developed based on

PT MS GIS database and PT MS HGU Documents. This map object is to show the existence of Village’s road inside PT MS HGU.

b. Maps of Acquisitioned Measurement Result, scale 1:10.000. It was developed based on information from affected parties regarding their customary right of their land, signed by each of them and also by their representatives (local head of villages). During re-certification, auditee asked to provide a random sample of maps that issued every year, and it proven indicatively that maps available for all land acquisi-tioned process.

c. Maps of enclave areas 2015, available for 3 estates, scale 1:20.000. This maps showed information re-garding land inside HGU that still owned by local community members.

According to the Maps of enclave area and records of “Status of Land Problem in PT Mustika Sembuluh, May 30th 2015”, there are some area inside HGU that still owned by local communities. Its indicate that until this recertification audit, company still respected communities’ decision’s to give or withhold their consent. Com-pany still respects community rights to keep hold their customary user rights.

As the result of 4th surveillance, PT MS could show evidences regarding negotiated agreements. There were records showed during audit reflected the FPIC process has conducted for each acquisition process, as fol-low: a. Declaration Letter of No Conflict According to the land. b. Meeting Note: Agreement of Compensations Value. c. Meeting Note: Measurement and Coordinate Survey. d. Declaration Letter for related Boundary. e. Land Sketch.. f. Record of GRTT Measurement. g. Meeting Note: Measurement and Coordinate Pointing Survey. h. Meeting Note: Vegetation inventory in related land i. Declaration Letter From owner regarding “A Will for not sue any other compensation regarding the com-

pensated land”. j. Payment records. k. Declaration of land hand over. l. Map regarding compensated land, signed by affected party and local head of village (authorities). m. Photo documentation for hand over, payment and compensation measurement process.

There were no new land acquisitions and negotiation process since the last surveillance until this re-certification audit.

Compliance status : Full Compliance

Principle 3: Commitment to long-term economic and fi nancial viability

Criterian 3.1 There is an implemented management pla n that aims to achieve long-term economic and financial viability

Findings: The company still uses financial projections for year 2015 to 2020 (include of both mills), which includes ex-plain information about total planted area, FFB production, process FFB, CPO & PK production, extraction rate (OER & KER), cost of production, cash flow, cash surplus (deficit) from operation, milling process, capital and revenue expenditure, average yield per hectare, and including information about total capex of plantation and mill. Projection of year 2015-2020 that the company will profit. Besides having a financial projection that the company has a budget year 2015 too.

The company has developed replanting programs for the next 13 years. Replanting programs will be start in year 2025, with 56.92 ha replanted in those areas previously planted in the year 2000, 1,125.43 ha in year 2026, 1,017.41 ha in year 2027, in 2,487.53 ha in year 2028, 3,203.86 ha in year 2029, and 3,606.05 ha in year 2030 but the plan can be changed according to the productivity of FFB from estate it.

The cooperative has been financial projection or management plan at least 3 years (year 2015-2019) where



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consist of area statement, maintenance & harvesting cost, FFB production, FFB price per tonne, capital ex-penditure, and profit and loss analist. Cause year planted in smallholder areas is year 2007 with lonsum progeny so that the smallholder has not replanting plan. Compliance status: Full Compliance

Principle 4: Use of appropriate best practices by gr owers and millers

Criterian 4.1 Operating procedures are appropriately documented, consistently implemented and mon-itored

Findings :

SOPs Estate (Plantation) and mill still well documented, implemented and monitored consistently. SOP in-cludes all activities in the Plantation activity and Mill. Agriculture Manual and Standard Operating Procedure for Oil Palm in 2011 is still the documented procedures for Estate (plantation activity) and no change from the previous year. SOP is applied also in the company under WILMAR Group, which includes nursery activity, land clearing, planting, usage of pesticides (circle and path spraying, selective and spot spraying), manuring, harvesting, etc. Moreover, to complete the procedure detailed that has not been regulated in the Agriculture Manual and Standard Operating Procedure for Oil Palm in 2011, the organization also establishes procedures relating to other plantation activities. For example, the procedures established by the Environmental Man-agement Unit (EMU), such as “SOPs Kalibrasi Alat Semprot (SA/06/EMU/(0)/0811)” or “SOP Deteksi dan Sensus Hama dan Penyakit Kelapa Sawit” (SA / 02 / EMU / (1) / 0710). Another example is “Prosedur Standar Keselamatan Kerja (PSKK)” related to Safety, such as, “Prosedur Standard Keselamatan Kerja Panen /Pemangkasan Pelepah Kelapa Sawit (Harvesting & Pruning)” (PSKK 01/CKP/(1)/1209).

Meanwhile for the Mill, documented SOP is SOP "Standard Operation Procedure Safe Palm Oil Mill (WIP / POM / SOP / 01 / 02-14). This SOP also implemented all Mill under Wimar Group, and the like in the planta-tion, other SOP were also established, especially in POM 2, for example SOP Operational Digester (SOP / MSPOM-PRS-004). All activities from reception of FFB, production processes, sales, have been regulated in SOP, including Supply Chain-Mass Balance (SOP / MSPOM-LOG-006).

However, related the consistency of SOP’s implementation, still it found some inconsistencies in the field, for example: 1. Accident investigation was not carried out by personil which has capability or responsibility for accident

dated on 4 May 2015 in MS2 POM so it condition not compliance with accident investigation procedure. 2. Impelementation of fertilizer doses not appropriate with circular letter dated on 26 January 2015 from En-

vironmental Management Unit (EMU) regarding standard of fertilizer doses with using fertilizer bowl kingoya, as follows : • Applied of MoP at block 090 (MS-1) with fertilizer doses is 1.75 kg/palm so using yellow bowl with fre-

quency of 2 times but based on calibration table from EMU should have been used is blue bowl with frequency of 3 times.

• Applied of MoP at block 014 (MS-2) with fertilizer doses is 1.50 kg/palm so using blue bowl but based on calibration table from EMU should have been used is green bowl with frequency of 2 times.

• Applied SOA at block 032 (MS-3) with fertilizer doses is 1.75 kg/palm. 3. Found implementation pruning with “Songgo 1” (one subtending fronds below the lowest fruit bunch) at

Block 913 Year Planted 2008 (MS 2 Plasma). It is not in accordance with SOP "Agriculture Manual and Standard Operating Procedure for Oil Palm in 2011" and Procedure Standard Safety Harvest / Pruning sheaths palm Oil (Harvesting & Pruning) (CPPS 01 / CKP / (1) / 1209, Rev 01, December 1, 2009) that stated the standard Pruning is “Songgo 2” (two subtending fronds below the lowest fruit bunch).

4. Found difference between "Agriculture Manual and Standard Operating Procedure for Oil Palm in 2011," “Prosedur Standard Keselamatan Kerja Panen dan Pemangkasan Pelepah Kelapa Sawit (Harvesting & Pruning) (PSKK 01/CKP/(1)/1209, Rev 01, 1 Desember 2009)” and "Standard Operation Procedure Safe Palm Oil Mill (WIP / POM/SOP/01/02-14) that is regarding Minimum Ripeness Standard. In 1)."Agriculture Manual and Standard Operating Procedure for Oil Palm in 2011" stated that 5 loose fruit on the ground for less than 7 year old palms, and 2 (two) loose fruits on the ground for 7 years old and above palm, 2).“Prosedur Standard Keselamatan Kerja Panen dan Pemangkasan Pelepah Kelapa Sawit (Harvesting & Pruning) (PSKK 01/CKP/(1)/1209, Rev 01, 1 Desember 2009)” stated that 5 loose fruit on the ground, there’s no difference year of planting, and 3). the "Safe Standard Operation Procedure mills



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(WIP / POM / SOP / 01 / 02-14" is ≥ 10 loose fruit on the ground. 5. There was no evidence that the Estate conduct regular harvest inspection (weekly) related standards and

quality of the harvest and reported to the EMU every Wednesday using the form QAMS Weekly Report, as required in the "Agriculture Manual and Standard Operating Procedure for Oil Palm in 2011".

6. Harvesting Interval conducted in MS 2 and MS 3 are not in accordance with the requirements in the "Ag-riculture Manual and Standard Operating Procedure for Oil Palm in 2011" which is 7-10 days, an average harvest interval both the estate exceeds 10 days.

7. Actual of digester temperature in June 2015 are 400-700C at both of POMs not appropriate with procedure (safe SOP for palm oil mill (WIP/POM/SOP/01/02-14). Inside SOP that digester temperature is 95 ± 50C.

8. Based on interview with PiC transit warehouse and field conductor (FC) in MS2 that spraying workers bring PPE to their home and fertilizer workers bring/keep PPE to PiC of transit warehouse’s home. It condition was appropriated with PPE procedure (PROS-SD-15-05) and OHS standard about washing work tools (PSKK14/CKP/(0)/0909).

9. MS-1 POM was not done responsed for incoming letter so record of response for incoming letter not available too. The estate has responsed for incoming letter dated on 3 February 2014 from Pondok Da-mar village (letter no.89/PDM-MHU/Ur-Pem/ii/2014) more than 14 days. It condition not appropriate with procedure of providing information to outside parties/stakeholders (transparency).

It condition above was raised as non-conformity (NCR No.2015-05 of 18 ).

One of the mechanisms for checking the consistency of SOP implementation is Internal Audit. Internal Audit conducted once a year and last Internal audit was conducted on 9-13 February 2015 for Estate and Mill

Records of monitoring and implementation of each action are maintained and available, for example, availa-bility of operational records in POM, is also well documented in every station that recorded each parameter being monitored, for example Strelization Section Logsheet, Pressing Station Log Sheet, Clarification Station Journal.

Palm oil mill has recorded the origin of all Fresh Fruit Bunches (FFB) sourced from third parties, collecting and cooperative and it is done in accordance with the related procedures, one of which is SOP Penerimaan TBS (SOP/MSPOM-LOG-003) and Supply Chain SOP-Mass Balance (SOP / MSPOM-LOG-006).



The related the consistency of SOP’s implementation, still it found some inconsistencies in the field, for ex-ample : 1. Accident investigation was not carried out by personil which has capability or responsibility for accident

dated on 4 May 2015 in MS2 POM so it condition not compliance with accident investigation procedure. 2. Impelementation of fertilizer doses not appropriate with circular letter dated on 26 January 2015 from En-

vironmental Management Unit (EMU) regarding standard of fertilizer doses with using fertilizer bowl kingoya, as follows : • Applied of MoP at block 090 (MS-1) with fertilizer doses is 1.75 kg/palm so using yellow bowl with fre-





4. Found difference between "Agriculture Manual and Standard Operating Procedure for Oil Palm in 2011," “Prosedur Standard Keselamatan Kerja Panen dan Pemangkasan Pelepah Kelapa Sawit (Harvesting & Pruning) (PSKK 01/CKP/(1)/1209, Rev 01, 1 Desember 2009)” and "Standard Operation Procedure Safe Palm Oil Mill (WIP / POM/SOP/01/02-14) that is regarding Minimum Ripeness Standard. In 1)."Agriculture Manual and Standard Operating Procedure for Oil Palm in 2011" stated that 5 loose fruit on the ground for less than 7 year old palms, and 2 (two) loose fruits on the ground for 7 years old and above palm, 2).“Prosedur Standard Keselamatan Kerja Panen dan Pemangkasan Pelepah Kelapa Sawit (Harvesting & Pruning) (PSKK 01/CKP/(1)/1209, Rev 01, 1 Desember 2009)” stated that 5 loose fruit on the ground, there’s no difference year of planting, and 3). the "Safe Standard Operation Procedure mills



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(WIP / POM / SOP / 01 / 02-14" is ≥ 10 loose fruit on the ground. 5. There was no evidence that the Estate conduct regular harvest inspection (weekly) related standards and

quality of the harvest and reported to the EMU every Wednesday using the form QAMS Weekly Report, as required in the "Agriculture Manual and Standard Operating Procedure for Oil Palm in 2011".



8. Based on interview with PiC transit warehouse and field conductor (FC) in MS2 that spraying workers bring PPE to their home and fertilizer workers bring/keep PPE to PiC of transit warehouse’s home. It condition was appropriated with PPE procedure (PROS-SD-15-05) and OHS standard about washing work tools (PSKK14/CKP/(0)/0909).

9. MS-1 POM was not done responsed for incoming letter so record of response for incoming letter not available too. The estate has responsed for incoming letter dated on 3 February 2014 from Pondok Da-mar village (letter no.89/PDM-MHU/Ur-Pem/ii/2014) more than 14 days. It condition not appropriate with procedure of providing information to outside parties/stakeholders (transparency).

Criterian 4.2 Practices maintain soil fertility at, or where possible improve soil fertility to, a leve l that ensures optimal and sustained yield

Findings :

Related Management of soil fertility levels in Estate, are still performed well eg fertilization activity and guided by the Agriculture Manual and Standard Operating Procedure for Oil Palm in 2011 in Chapter 6.3 (Oil Palm manuring) and also SOP “Aplikas Pemupukan (SA 09/EMU/0/0910), 15 September 2010) and also consist-ently done in accordance with Recommendation EMU which based on the results of leaf analysis which is conducted every year. Recording in this regard can be seen in each Estate (MS 1, MS 2, MS 3 and Small-holder). For example in the MS 3, which is in Block 004 (Division 1A), for NPK fertilizer in March 2015 period, the dose recommended by the EMU was 2.5 Kg / Palm with palm number are 688, then the amount of fertiliz-er is 1720 Kg. Refer to Fertilization Report and Material Requisition and Issue Slip, obtained information amount of fertilizer used for Block 004 is 1750 Kg and conducted on March 28, 2015. Another example is in the MS 2, Emu recommended for block 064, Dolomite dose of 1.5 kg / Palm with the amount of fertilizer is 8043 kg (number of palm are 5362). Refer to Fertilization Report (Division 1A) and Material Requisition and Issue Slip, obtained information amount of fertilizer used is 8050 Kg and was conducted on March 12, 2015.

Last leaf analysis conducted in February-March 2015, but the results are still in process. Parameters analyzed were Major Element and Minor Element, for examples of Major Element is content% N,% P,% K, Mg and% CA%, while for the minor element is the content of% B.

To ensure the quality of the fertilizer, quality inspection fertilizer consistently performed as required in “SOP Pengambilan Sampel Pupuk” (SOP 45 / EMU / (0) / 0709). Unlike the previous year, for the fertilizer used Smallholder, already conducted. For example, inspection for NPK fertilizer conducted by EMU on 18 April 2015, Its quality in accordance with several parameters, such as % Nitrogen (N), % P2O5 and % K2O. In ad-dition, for the accuracy of dosing, EMU and Plantation management has issued a recommendation for the use of Fertilizer bowl standard as of January 26, 2015, which must be implemented for a period of fertilization year 2015. However, this is not consistently done in MS 1, MS 2 and MS 3. It was raised as non-conformity above.

Soil analysis and leaf analysis conducted periodically. For the soil analysis carried out in accordance with the “SOP Pengambilan Sampel Tanah untuk Status Kesuburan Tanah” (SA / 09 / EMU / 0/0115, dated 1 January 2015).

Soil Fertility database has been established on the soil survey report in 2007. The soil sampling conducted regularly every 15 years or as needed such as when replanting to know the status of soil fertility in each group of soil-management classes based on the documents of the land survey report. Scale sampling is used for soil survey in 2007 is a semi-detailed scale (1:20 Ha).

For Smallholder, sampling and soil type checking conducted on June 30, 2015. Sampling of soil for Small-holder conducted at 5 points, among others, Block 901 with coordinates 02º 40' 1.240 "(S) and 112º 34' 4.631" (E) with a depth of 0- 30 cm. Another sample point as in Block 911, with coordinates 02º 40' 29.372



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"(S) and 112º 34' 27.977" (E).

Nutrient recycling strategy is Empty Fruit Bunches (EFB) and Palm Oil Mill Effluent (POME) consistently done. EFB applications carried out in accordance with the Agriculture Manual and Standard Operating Procedure for Oil Palm in 2011 and also in accordance with the recommendations of the EMU. EFB applications con-ducted in MS1, MS 2, MS3 and Smallholder. One example of implementation is in MS 2 Block 021, conducted on April 2015 with the dose recommendation of 40 tons of EFB / ha / year and has been applied to 464.7 tons. Other examples: on May 2015 in Block 001, has been applied to 661.5 tons.

Meanwhile, For applications Palm Oil Mill Effluent (POME) is done in MS 1, such as in Block 090, Block 091, 083 087, 088, 095 and 096


Criterian 4.3 Practices minimise and control erosio n and degradation of soils

Findings :

The company has map of fragile soils and map of soils (Param Agriculture Soil Survey with scale 1:66,000) where in MS1, there are fragile soils i.e Gali (organosol hernik), buso (podsolik humik), miri (pudsol humik), and serai (arenosol albik), whereas in MS 3 i.e buso (podsolik humik) and serai (arenosol albik). A manage-ment strategy for fragile soils (serai and buso) is EFB mulching Topography in PT Mustika Sembuluh areas is flat-undulating (0-60) as seen on map of topography PT Mustika Sembuluh (scale 1:105,000) so the company has not been management strategy for plantings on slopes above a certain limit.

To support activities in the field, road maintenance conducted throughout the estate and smallholder periodi-cally.

There are 6 subsidence monitoring points that are monitored once every 6 months with results of subsident monitoring are average 0.3 / year. During surveillance audit company already monitored ie April 2015 point to monitor the erosion of one of them in division IA, block 041 with coordinates 02º39.268 (S) and 112º29.626 (E) and also in Division B, block 107 with coordinates 02º40.913 ( S) and 112º33.056 (E). On the company's "SOP for Management and Monitoring of Peat Land for Oil Palm Planting Correct" (SA 03 / EMU / (2) / 1210) it was determined that water from the soil surface level limit should be maintained in the range of 50-75cm especially during dry season, the which shall be maintained at a level of 75 cm from the soil surface. Based on recent data, In MS2 Peat area of 8.38 hectares with planted area 7.88 hectares, while the sandy area of 476.81 hectares with planted area 460.63 hectares. For MS 3, peat land area of 606.24 hectares and planted an area of 583.47 hectares, while for sandy soil area of 1453.7 ha and planted area of 999.28 hectares. A management strategy for fragile soils is EFB mulching. The fragile soils not available in smallholder areas.


Criterian 4.4 Practices maintain the quality and av ailability of surface and ground water

Findings :

The estate has a matrix of water management and monitoring plan contained in the environmental evaluation document at the stage of plantation and mill operations including river water quality testing, water soil quality testing, testing of soil chemical substantial. The company also took Water Treatment for bathing, washing and sanitary and each division has a Water Treatment Plant (WTP) for drinking water of employees. The company has been testing the quality of water for the needs drinking of the WTP results conducted periodically once every 6 months. The company should adjust the parameters required to be tested for drinking water quality requirements as set out in Permenkes 492/Menker/Per/IV/2010.

The estate also has a water management plan regulated in riparian management procedures (riparian belt) by installing a sign on the riparian is a red marker with a distance of 5 meters wide river border. The company al-so prohibits spraying and fertilizing activities in riparian areas to minimize contamination of water with chemi-



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cals.

The plasma/smallholder areas also have doing the same thing as was done by the nucleas where the plas-ma/smallholder also has a water management plan included in the document UKL-UPL. Plasma/smallholder also perform management and monitoring of the water that is by conduct testing of water quality and have re-ported UKL-UPL reports each semester regularly. The company (nucleus and smallholder areas) has carried out water management in peat areas in form of maintain of water level where the results of monitoring year 2014 are 50-70 cm, the which shall be maintained at a level of 75 cm from the soil surface.

During a visit to the field in MS-1 estate (Division 2 Block 052) has done tagging is stakes in red paint, but in MS-2 Division 1 Block 072 is not found tagging of stakes in red paint. The company should ensure that all ri-parian area that has been done is marking stakes are identified in red paint and consistent with the width of the riparian have been set in the procedure is as wide as 5 meters.

MS-1 POM has 14 palm oil mill effluent (POME) ponds where liquid waste of mill not dumped into the water bodies but used for land application. The company has a permit utilization of waste water in the soil of the PT. Mustika Sembuluh from Regent of East Kotawaringin with number : 660/2161/BLH/III/2010 dated June 24, 2010 with the total area licensed area of 719 hectares. The company has submitted an extension of the per-mit to use waste water to the Regent of East Kotawaringin and Head of the Environmental Agency East Ko-tawaringin with the letter number: 26/BM-MS/V/2015 dated May 21, 2015. The company should monitor the progress of the process of extending the permit to use waste water that has been submitted.

MS-1 POM has been conduct testing of waste water quality every month. Tests conducted by PT. Unilab Per-dana Environmental Laboratory where the liquid waste quality testing according to Environmental Agency de-cree No. 29/2003. The company also monitoring the water quality wells control periodically. The company al-so has reported regularly every 3 months in the form of reports of monitoring the quality of liquid waste to the Environmental Agency of the Province of Central Kalimantan and Regent of East Kotawaringin. For example, reports of liquid waste quality monitoring period from January to March 2015 with a testing parameters BOD, COD, pH, oil and fat, Pb, Cu, Cd, Zn, Total Nitrogen (N) and TSS. In the general, the quality of the liquid waste being tested is still below the quality standards set by Environmental Agency decree No. 29, 2003.

MS-2 POM has 14 palm oil mill effluent (POME) ponds where liquid waste of mill not dumped into the water bodies but used for land application. The company has a permit analysis of liquid waste on PT. Sawit Bumi Kencana (PT SBK) areas from East Kotawaringin District with number : 660/227/BLH-LA/2013 April 31, 2013, with total area application 449.06 hectares and total area analysis 89.81 hectares with a validity period of 1 year. The current process is : a. The company has submitted Request Submission Utilization of Palm Oil Wastewater (LA) to the Regent of

East Kotawaringin Up. Head of the Environment Agency Kotawaringin East with numbers: 05 / MS2-Mill / EHS / VI / 2014 dated June 17, 2014.

b. The company obtained a Certificate of Environmental Agency (BLH) East Kotawaringin Number: 660/343 / BLH / VII / 2014 dated July 18, 2014 stated that the Certificate of Land Application (LA) Utilization Permit is still in process in the BLH of East Kotawaringin. Certificate is valid for 30 days from the date of July 18, 2014 until the date of August 30, 2014.

c. It has conducted presentations and field survey by the Environment Agency of East Kotawaringin on No-vember 26, 2014 is equipped with the Minutes of the Meeting of Technical and field survey represented by East Kotawaringin Local Government and representatives of PT. Mustika Sembuluh.

d. The company has submitted the Submission of Follow-Up Minutes of Meeting and Review Technical Field to the Head of the Environment Agency East Kotawaringin with numbers: 31 / BM-MS / VI / 2015 dated June 30, 2015

MS-2 POM has been conduct testing of liquid waste quality every month. Tests conducted by PT. Unilab Per-dana Environmental Laboratory where the liquid waste quality testing according to Environmental Agency de-cree No. 29/2003. The company also monitoring the water quality wells control periodically. The company al-so has reported regularly every 3 months in the form of reports of monitoring the quality of liquid waste to the Environmental Agency of the Province of Central Kalimantan and Regent of East Kotawaringin. For example, reports of liquid waste quality monitoring period from January to March 2015 with a testing parameters BOD, COD, pH, oil and fat, Pb, Cu, Cd, Zn, Total Nitrogen (N) and TSS. In the general, the quality of the liquid waste being tested is still below the quality standards set by Environmental Agency decree No. 29, 2003.

PT Mustika Sembuluh has a procedure for the protection of streams and swampy areas, including mainte-nance and restoration of river banks and other buffer zones include : 1. River riparian belt management procedures (Riparian belt) with SOP document number 20 / HCV / (1) /

0115 revision 1 dated January 2015 which is made valid by HCV Senior Manager and approved by the



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Head Plantation. 2. Procedure of Watershed Management (DAS) with SOP document number 21 / EHS / (0) / 0409 revision 0

expiry date April 2009 prepared by the Environmental Officer and approved by the General Manager. 3. Procedures for the management and monitoring of peat soil for planting oil palm appropriately by docu-

ment number SA 03 / EMU / (3) / 0811 revision 3 effective date August 1, 2011 made by Agronomist, ex-amined by the Senior Research Manager and approved by the General Manager.

Based on volume of fertilizer records (NPK) period of February 2015 at block 061 (Division 1 – MS 2 estate) and block 512 (MS 3 estate) that company has applied for all palms inside block it whereas there are riparian areas within the blocks. Moreover the request of chemical for circle and path spraying at block 794 (MS-3 es-tate) still total of areas whereas there are riparian areas within the blocks. The company does not have suffi-cient evidence that they has not carried out fertilizer and spraying activities on riparian areas. It condition was raised as non-conformity (NCR No.2015-06 of 18 ).

PT Mustika Sembuluh carries out restoration by planting wood plants in riparian river. Plants grown in the ar-ea of restoration ie Tanjung (Mimusops elengi), Galam (Melaleuca cajuputi) and Sungkai (Peronema ca-nescens). It can be known based on field visits in the MS-1 Division 2 Blocks 052 and MS-2 Division 1 Block 072 where in the block has been done restoration ie by planting Sungkai. The company also monitoring the reduction in the peat surface and monitoring the water levels in peat.

The mill (MS1 and MS2 POM) has been conduct waste water quality testing and reporting periodically as listed in the utilization of liquid waste permit issued by the Regent of East Kotawaringin. The company also conducts liquid waste quality testing adapted to Environmental Agency decree No. 29, 2003 with testing pa-rameters BOD, COD, pH, oil and grease, Pb, Cu, Cd, Zn, Total Nitrogen (N) and TSS.

Based on the results of testing the quality of liquid waste in MS-1 POM by the Environmental Laboratory PT. Unilab Perdana can be seen that the BOD in January 2015 is 630 mg / L (Anaerobic Pond Outlet) and 298 mg / L (Indicator Pond Outlet 2), February 2015 is 634 mg / L (Anaerobic Pond Outlet) and 365 mg / L (Indicator Pond Outlet 2), March 2015 is 686 mg / L (Anaerobic Pond Outlet) and 364 mg / L (Indicator Pond Outlet 2), April 2015 is 1,889 mg / L (Anaerobic Pond Outlet) and 258 mg / L (Indicator Pond Outlet 2) , May 2015 is 582 mg / L (Anaerobic Pond Outlet) and 244 mg / L (Indicator Pond Outlet 2). Whereas quality of liquid waste (BOD parameter) in MS-2 POM are January 2015 is 675 mg / L (Aerobic Pond Outlet), February 2015 is 202 mg / L (Aerobic Pond Outlet), March 2015 is 166 mg / L (Aerobic Pond Outlet), April 2015 is 117 mg / L (Aer-obic Pond Outlet) and May 2015 is 52 mg / L (Aerobic Pond Outlet).

The company (MS-1 & MS-2 POM) uses water for processing that comes from the reservoir. Total of water consumption year 2014 in MS-1 POM to the process activities (218,735 m3), boiler (229,604 m3) and domestic (135,277 m3) as much as 583,616 m3 with fresh fruit bunches that is processed as much as 282,173,328 kg so the use of water for the production of the fresh fruit bunches is 1.59 m3 / ton of FFB. Total of water con-sumption year 2015 than in January-May 2015 to the process activities (82,782 m3), construction (76,320 m3) and domestic (55,372 m3) as much as 214,473 m3 of fresh fruit bunches that is processed as many as 128,812,340 kg so the use of water for the production of the fresh fruit bunches is 1.24 m3 / ton of fresh fruit bunches. Whereas, total of water consumption year 2014 in MS-2 POM to the process activities (103,020 m3), boiler (101,048 m3) and domestic (53,327 m3) as much as 257,395 m3 of fresh fruit bunches that is pro-cessed as much as 175,469,000 kg so the use of water for the production of the fresh fruit bunches is 1.16 m3 / ton of fresh fruit bunches. Total of water consumption year 2015 than in January-May 2015 to the process activities (48,280 m3), construction (52,917 m3) and domestic (19,454 m3) as much as 120,651 m3 of fresh fruit bunches that is processed as much 80,794,580 kg so the use of water for the production of the fresh fruit bunches is 1.25 m3 / ton of fresh fruit bunches.



The company does not have sufficient evidence that they has not carried out fertilizer and spraying activities on riparian areas because the volume of fertilizer records (NPK) period of February 2015 at block 061 (Divi-sion 1 – MS 2 estate) and block 512 (MS 3 estate) that company has applied for all palms inside block it whereas there are riparian areas within the blocks. Moreover the request of chemical for circle and path spraying at block 794 (MS-3 estate) still total of areas whereas there are riparian areas within the blocks.



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Criterian 4.5 Pests, diseases, weeds and invasive i ntroduced species are effectively managed using appropriate Integrated Pest Management techniques

Findings :

Integrated Pest Management System consistently performed as planned, both in the MS1, MS2, MS3 and Smallholder. Technical implementation of IPM conducted in accordance with the Agriculture Manual and Standard Operating Procedure for Oil Palm in 2011 and also “SOP Deteksi dan Sensus Hama dan Penyakit Kelapa Sawit” (SA 02/EMU/(1)/0710. Planting benefical Plant such as Turnera and Antigonon by the whole estate and plasma, for example planting Turnera and Antigonon in block 024 (MS3), block 005 (MS2) and block 077 (MS1). There was also the whole estate, preserve Tyto Alba in the field as a biological control, for example, in block 84 (MS1), block 053 (MS2) and block 042 (MS3).

Detection and Census Pest and diseases are always consistently performed and documented. For example MS1 period May 2015 at block 051, attack level "Ulat Kantong" is 0.02%, there is no “Ulat Api” attack, and Oryctes also. While in Smallholder, for example, Period of February 2015 at Block 901, attack level of 0.5% "Ulat Kantong", “Ulat Api” 0.03%. Overall, level of attack for estate and Smallholder still below the economic threshold. Therefore from the end of 2014 until now, there have been no caused outbreaks and so that Chemical control was not conducted

All estate and Smallholder always ensure that employees who involved in the implementation of IPM has trained and training results are always documented. For example, in MS1, training was conducted May 13, 2015 and in MS2 has conducted training on 22 April 2015.


Criterian 4.6 Pesticides are used in ways that do n ot endanger health or the environment

Findings :

The Company use pesticide under recommendation of authorized party. List of usage pesticide according to Recommendation of Pesticide Usage from Labor Office of District Kotawaringin Timur. As Metil Metsulfuron, Isopropil Glyphosat, Triclopyrequivalent, Gufosinate Ammonium, Cypermetrin, Lambda-cyhalothrin, barodi-facoum, Deltametrin, Fipronil, Abamectrin, Difenokonazol, Propineb, Mankozeb, Dimetil Amina, Metil Tiofanat, Benomel, Walfarin.

The use of pesticides is documented in every estate and Smallholder as stated in Usage Analysis of active ingredient per ha Report and also the Agrochemical usage per activity Report. For example, the use of the ac-tive ingredient glyphosate isopropylamine / ha in MS 1, March 2015 the value of AI / Ha is 0.19 and April 2015 value of AI / Ha 0.18. Another example is the active ingredient Trikorphyr March and May 2015 respectively the value of AI / Ha adala 01

Company provide regular medical check for all employees Including for Reviews those who apply agrochemi-cal and chemical store keeper, MCU conducted once a year. The Last MCU was done in April 2015.

To ensure the spray equipment used in good condition, all estate and Smallholder are periodically calibrate spray equipment. For example, on May 9, 2015 calibration for 8 (eight) spray equipment Micron Herbi (MS1), while in MS 2 and Smallholder was conducted on May 26, 2015 - 28 May 2015 for spray RB-15

Storage of pesticides including the disposal of used pesticide containers in accordance with the relevant regu-lations. The Company categorizes used pesticide containers as a Hazardous Waste (LB3). In addition to some training that has been described previously, some training has also been planned by each estate and smallholder, which is recorded in the Training Program Year 2015. For examples of training that has been im-plemented is training RSPO principles and criteria in all estate and plasma on June 2015. Another example is the Training K3 dated 29 January 2015 (MS2), Training P3K dated December 17, 2014 (MS2) and 24 April 2015 (MS3), Emergency Drill and fire extinguisher on 14 November 2014 (MS2) and March 13, 2015 (MS3). All the training result is documented. In POM, the training program has also been planned. Examples of train-ing that has been done is RSPO-SCCS Training in POM 2 18 to 19 September 2014, Training Work Permit, May 11, 2015 (POM 1) and May 6, 2015 (POM2), Training Water Treatment, 24-26 March 2015 (POM 1 and POM 2), Boiler Training in POM 2 April 6, 2015. Meanwhile safety induction for contractors is still consistently



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done in POM 1, for example, the CV Indah Sentosa conducted on 20 May 2015. All the training result is doc-umented.


Criterian 4.7 An occupational health and safety plan is documented, effectively communicated and im-plemented

Findings :

The PT Mustika Sembuluh's Occupational Health and Safety (OHS) Policy which is still same as Wilmar In-ternational's OHS policy since PT Mustika Sembuluh is one of the subsidiaries of Wilmar International Group. The cooperative smallholder has OHS policy too. The policy has provided in bi-languanges (English and In-donesian). The OHS policy was established and approved by top management (chairman and chief execu-tive officer). The company (estates and mills) have OHS team/committee activities plan year 2015 but OHS programme/plan year 2015 not available. It was raised as non-conformity (NCR No.2015-07 of 18 ).

All operations have carried out risk assessment except MS-2 mill and there is procedure and action plan to reduce risk it not implement i.e there are workers smoking in MS-1 mill areas. It condition was raised as non-conformity (NCR No.2015-08 of 18 ). Result of risk assessment in form of the Environmental and OSH As-pects and Impacts (FRM 01/SOP11/EHS/01/0909) period of 2014-2015 every section/department. If the re-sult of assessment is high category so control programme was available.

All workers has trained about safe working practices and has distributed PPE to all workers but auditor was founded 2 harvest workers in MS-3 estate not using PPE except boots (they are has worked during 10-11 months), harvest workers and supervisor of fertilizer activity at block 090 (MS-1 estate), harvest workers at block 039 (MS-2 estate) and pruning workers at block 913 (smallholder in MS-2 estate) not using PPE. Whereas, cover harvesting tools (knife sickle (egrek) and “dodos”) not available in MS-3 estate. It was raised as non-conformity (NCR No.2015-09 of 18 ).

PT Mustika Sembuluh (MS) has an Occupational Safety and Health (OSH) team responsible for occupational health and safety programs in every unit (estates and mills) where include of smallholder where estates unit and MS-1 mill of PT Mustika Sembuluh has a team of OHS (Work Safety and Health Committee (P2K3)) which has been approved by the authority agency, for example : MS-1 mill’s OSH team has approved by local government in form of head of social, man power and transmigration department of Kotawaringin Timur de-cree no.KEP.560.566/225/WAS-KK.P2K3/VI/2015 dated on 25 June 2015 and MS estates no. KEP.560.566/228/WAS-KK.P2K3/VI/2015. The person who responsible for OHS should be registered and must have OHS competency certificate issued from the government manpower agency. If any the structure has been changed and re-approval by the Social Service, Man Power and Transmigration Department of Ko-tawaringin Timur District. MS-2 mill was submitted request of re-approval since 29 June 2015 because struc-ture of organization has been changed. During recertification audit, re-approval was not issued. It condition was raised as non-conformity above. MS2 mill has submitted OHS report period January to March 2015 to local government (level of district and province) dated on 27 April 2015 and it has received by local govern-ment level of district dated on 27 April 2015 and level of province dated on 29 April 2015. For period October to December 2015 dated on 22 January 2015.

Each estate and mill has its own OSH team which holds a regular OHS meeting about health and safety is-sues where example : OHS team in MS-1 mill was meeting dated on 5 February 2014, 14 March 2014, 25 April 2015, 12 May 2014, 8 August 2014, 20 November 2014, 9 January 2015, 26 February 2015 and 27 March 2015 but MS-2 mill was not discussed for health issues. It was raised as non-conformity (NCR No.2015-10 of 18 ). Welfare issues was discusses by Bipartite cooperation institution (LKS Bipartit) in estate and mill where example : Bipartite cooperation institution (LKS Bipartit) in MS-1 mill was meeting dated on 6 June 2015, 11 April 2015 and 21 February 2014 but MS-2 mill was not carried out regulary meeting so wel-fare issues was not discussed. It condition was raised as non-conformity (NCR No.2015-10 of 18 ).

Company has endorsed a procedure of emergency preparedness and response and builds the special team to handle it (SOP 02/EHS/(0)/0409 rev.0, PTD 05/CKP/(0)/0409 rev.0, and PTD 03/CKP/(0)/0409 rev.0). Emergency cases including fire prevention, disaster management, pollution hazard and environment disturb accident and so on. MS-2 POM has checking fire extinguisher condition (19th unit at mill and 24th unit at em-plasment mill) dated on 10 June 2015 where the results of monitoring are good condition and not experied. Moreover, MS1 estate has carried out simulation of firefighter & socialization of using fire extinguisher at H7T



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emplasment dated on 18 March 2015 and it has evaluated.

Estates and MS-1 mill has recapitulation of accident report year 2014 and 2015 (January to March) include of board of accident but the records of accident in MS-2 mill not available with complete. Moreover, Estates and mills were not carried out review of accident by regularly. It was raised as non-conformity (NCR No.2015-11 of 18 ). Estates and mills has kept record of accident investigation example 2 accidents in MS-1 mill and 4 accidents in MS-2 mill year 2015 but record from one of accident investigation in MS-3 estate not available. It was raised as non-conformity (NCR No.2015-11 of 18 ).

The company has conducted first aid training for all group coordinators and field conductors at the estates and mills example dated on 19 December 2014 and 25 June 2015 in MS-1 mill, dated on 26 June 2015 in MS2 mill and dated on 22 June 2015 in MS1 estate and field conductors are required to bring first aid kits to worksites. Whereas, first aid kit in mills was available too such as security pos, warehouse, process A & B, maintenance, general affair & laboratory and sortation. MS2 mill has checking first aid box dated on 10 June 2015 in mill office, WTP stasion, security pos, sortation stasion and workshop areas.

PT Mustika Sembuluh was provided polyclinic as place for handle treatment cause sick or minor accident. If polyclinic can not handle so the patient referred to the hospital affiliate. Medical expenses of employees are covered by the company and Workers Social Security Agency (BPJS Kesehatan). The company provides Workers Social Security Agency (BPJS Ketenagakerjaan) for permanent daily workers, both at the estate and mill, which covers accidents and annuity. The company also provides accident insurance for temporary work-ers under Workers Social Security Agency (BPJS Ketenagakerjaan), with evidence in the form of a valid “BPJS Ketenagakerjaan” card for all existing employees and workers and payment of workers social security agency (BPJS Kesehatan & BPJS Ketenagakerjaan) retribution year 2015.

MS2 mill has carried out medical check up on June 2015 with parameters are audiometri, rontgen of thorax, etc.

Information of accident was included LTA/LTR in estates and mill example LTA year 2014 in MS-1 mill is 3.5 and May 2014 is 14 but it is not available in MS-2 mill because accident records not available. It was raised as non-conformity (NCR No.2015-12 of 18 ).


NCR No.2015-07 of 18 (indicator 4.7.1 as Major non-conf ormity)

The company (estates and mills) have not OHS programme/plan year 2015


• Third party workers and MS-1 mill worker smoking in mill areas where there is sign of prohibit smoking near them smoke

• MS-2 mill have not risk assessment


• There are 2 harvest workers in MS-3 estate not using PPE except boots (they are has worked during 10-11 months) and cover harvesting tools (knife sickle (egrek) and “dodos”) not available too.

• There are harvest workers and supervisor of fertilizer activity at block 090 (MS-1 estate), harvest workers at block 039 (MS-2 estate) and pruning workers at block 913 (smallholder in MS-2 estate) not using PPE.


• OHS committee meeting was not discussed for health issues in MS-2 mill • No evidence that Bipartite cooperation institution (LKS Bipartit) has carried out regulary meeting in MS-2

mill so welfare issues was not discussed

NCR No.2015-11 of 18 (indicator 4.7.5 as Minor non-conf ormity)

• The records of accident in MS-2 mill not available with complate such as board of accident statistic, acci-dent report every month, etc.

• The company (estates and mills) was not carried out review of accident by regularly • Record from one of accident investigation in MS-3 estate not available



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Information of LTA/LTR not available in MS-2 mill because accident records not available.

Criterian 4.8 All staff, workers, smallholders and c ontract workers are appropriately trained

Findings :

PT Mustika Sembuluh has some training programs designed for staff, workers and plasma farmers as well. There are several trainings has programmed for staff, workers and smallholder farmers (plasma) and also for contractor, e.g. best practice management on spraying, fertilizing, harvesting, fruit grading; first aid and safe-ty, waste management, plan pest detection, fire-fighting simulation, work risk analysis, and HCV.

The company has conducted first aid training dated on 25 June 2015 in MS-1 mill, dated on 26 June 2015 in MS2 mill and dated on 22 June 2015 in MS1 estate, and RSPO SCCS dated on 21-22 April 2015. Recording on staff training provided with evidence of minutes and certificate on implemented training such as first aid training, RSPO SCCS,etc.

PT. Mustika Sembuluh generally uses contractors to transport FFB and CPO, and socialization regarding to OHS has been conducted to them, and the contractors should pay attention and implement the OHS policy in worksite. There is no procedure which set mandatory for contractors who will work in the company’s worksite should have demonstrable expertise. Company need to improve the selection method in contractor tender process through revise procedure SOP No. 53/CKP/(0)/0909 to include consideration of the contractor ability / expertise in the field which it is responsible as the qualification criteria of selection.


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

Criterian 5.1 Aspects of plantation and mill managem ent, including replanting, that have environmen-tal impacts are identified, and plans to mitigate t he negative impacts and promote the positive ones are made, implemented and monitored, to demonstrate continual improvement Findings :

The company (estates and MS-1 POM) has the Environmental Evaluation Document (DELH) the development of palm oil plantations and increased capacity of palm oil processing with details of the total area of 19,990 hectares and a mill capacity of 120 ton / hour.

This document prepared by the CV. Green Enviro Consultant based in Palangkaraya year 2011. DELH has been received approval from the Environment Agency of Central Kalimantan Province No. 660/760/2011 dat-ed October 3, 2011. In the DELH contained matrix management plan and environmental monitoring in the pre-construction, construction phase, operation phase and the post-operation phase in the estate and mill.

MS-2 POM has the document guidelines on the implementation of Upaya Pengelolaan Lingkungan (UKL) and Upaya Pemantauan Lingkungan (UPL) related to the construction of a palm oil mill (POM) and other infra-structure with a mill capacity of 90 tons / hour.

This document prepared by the CV. Green Enviro Consultant based in Palangkaraya year 2011. UKL-UPL has been received approval from the Environmental Agency of the Government of East Kotawaringin with No. 660/24 /RKM/UKL-UPL/BLH/IV/2013 dated April 12, 2013. In the UKL-UPL contained matrix management plan and environmental monitoring in the pre-construction, construction phase, operation phase in the mill.

Bita Maju Bersama Cooperative (scheme smallholder) has the document guidelines on the implementation of Upaya Pengelolaan Lingkungan (UKL) and Upaya Pemantauan Lingkungan (UPL) related to construction of smallholder plantation Cooperation of Bita Maju Bersama located in Pematang Limau Village, Seruyan Hilir District, Seruyan Regency, and Central Kalimantan Province with an area of 182.01 hectares.

This document prepared by the CV. Green Enviro Consultant based in Palangkaraya in 2014. UKL-UPL has been received approval from the Environment Agency District Government Seruyan by number :



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660/BLH.I/X/2014 dated October 31, 2014. In the UKL-UPL contained matrix management plan and environ-mental monitoring in the pre-construction, construction phase, operation phase.

The company (estates and MS-1 POM) was carried out periodic monitoring of the aspects set forth in the en-vironmental evaluation (DELH). The results of periodic monitoring reports be made in the RKL / RPL was re-ported every 6 months where the final report is Semester II period from July to December, 2014. Periodic monitoring include: (a) measurement of temperature, humidity, wind direction, wind speed and weather, (b) measurement of rainfall and the number of rainy days, (c) Air quality monitoring: testing of ambient, boiler funnel emission testing, mill generator flue testing, estate generators flue testing, vehicle flue testing, and testing the odor, (d) noise monitoring: noise measurement the outdoor courtyard, the noise indoor, the work-ing environment illumination measurement, measurement of shock in buildings, (e) monitoring the physical properties and chemical properties of soil, (f) monitoring of river water quality: surface water (river water) qual-ity measurement, measurement of the quality of effluent (POME), (g) ground water quality monitoring, (h) ero-sion monitoring, (i) monitoring of potential fire, (j) Monitoring of natural vegetation, (k) monitoring of wildlife, (l) monitoring of aquatic biota, (m) monitoring of employment opportunities, (n) monitoring of public income, (o) monitoring of attitudes and perceptions, (p) monitoring of public unrest, (q) monitoring of values and cultural norms community, (r) Monitoring the social process, (s) Monitoring of community health problems.

The company (MS-2 POM) was carried out periodic monitoring of the aspects set forth in the UKL-UPL. The results of periodic monitoring reports be made in the UKL / UPL was reported every 6 months where the final report is Semester II period from July to December, 2014. Periodic monitoring includes: (a) activities of pro-cessing fresh fruit bunches: monitoring of noise (noise indoors and the noise outside courtyard), ambient air, the odor, boiler funnel emission, generators flue emissions, vehicle emissions, illumination work environment, vibration absorbers in buildings, the quality of waste water, waste water flow, groundwater quality, physical and chemical quality of the soil, (b) operational facilities utility: monitoring the volume of sludge, (c) Mainte-nance of machines and other supporting equipment: monitoring the volume of hazardous and toxic waste, (d) Transporting CPO: monitoring of cases of accidents, (e) waste management: monitoring of waste types and volumes of waste.

In the UKL-UPL, Bita Maju Bersama Cooperative (scheme smallholder) is required to conduct environmental management and monitoring periodically. Management and monitoring required in the UKL-UPL include: (a) planting and maintenance activities of Immature (TBM): surface water quality monitoring, monitoring of the abundance of aquatic biota, (b) maintenance activities of mature plant (TM): river water quality monitoring, monitoring of the abundance of aquatic biota, (c) Harvesting and transportation of fresh fruit bunches (FFB) to the mill activities: monitoring of air quality and noise monitoring. Plasma is still in the process of preparation of the report UKL-UPL to be reported to government agencies


Criterian 5.2 The status of rare, threatened or end angered species and other High Conservation Value habitats, if any, that exist in the plantation or t hat could be affected by plantation or mill managem ent, shall be identified and operations managed to best ensure that they are maintained and/or enhanced . Findings :

HCV identification has already done both in nucleas estate and plasma estate. HCV document of nucleas plantation (MS1, MS 2 and MS3) conducted by external party (Malaysian Environmental Consultant Shd Bhd (MEC), meanwhile HCV for plasma estate conduct by Wilmars International HCV team on June 2013. HCV team has already obtained HCV identification training and wildlife monitoring training conduct by ZSL and Outrop organization.

In the plasma estate recorded HCV 4.1 as rivers buffer with total area of 2.2 Ha and already drawn in properly and standard map. This identification result completed with HCV management and monitoring plan contains HCV socialization plan to the member of cooperative Bita Maju Bersama, prohibition of chemical activity on the banks of the river, prohibition of hunting, poster/signboard installment and vegetation rehabilitation on the bare land. The result and management plan has been transferred to the cooperative management on 19 June 2013, and also for the farmers on 10 April 2013, including the introduction of wildlife and handling socializa-tion on 17 May 2013.

Record of results of identification HCV within nucleas estate consist of HCV1.3 landscape range of Orang Utan (MS1-MS3), HCV2.2 wetland ecosystem, corridor linking island refuges (MS1), HCV2.2 Kerangas and wetland ecosystem, corridor linking island refuges (MS2), HCV3 threatened Kerangas forest ecosystem (MS3), HCV4.2 riverine buffer for water quality and soil erosion (MS1-MS3), HCV4.3 riverine buffer for control



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of destructive fires (MS1-MS3), HCV5 areas of importance to support local communities (MS1), HCV5 & 6 ar-eas of importance to support local communities and maintain cultural sites (MS3), HCV 6 areas of importance for cultural identity (MS1). Based on map of HCV (scale 1 : 48,000) so location HCV areas in each estate is MS1 : HCV 5-6 at block D04B, HCV 5-6 at block H01T and block H02T, HCV 5-6 between block J02T with block J04T, HCV 6 at block J15T and block J16T, HCV 4 between block J17T with block J18T, HCV 4.2 dis-tributed in several locations; in MS2 : HCV 5 at between block L08T-L14T and M08T-M14T, HCV2.2 at block K27T-L27T, HCV4.2 distributed in several locations; and in MS3 : HCV1-6 at between block E49TU-G49TU and D24TU-D30TU (large forest), HCV1 at block D44TU, HCV3, 4.2 and 5 at between block B18TU-C18TU, HCV5 at block A08BU, HCV4.2 distributed in several location. The details of HCV existence in Mustika Sem-buluh as follows : Unit MS-1 : 49.28 ha of HCV 5,6 and 46.22 ha of HCV 4 (riparian), Unit MS-2 : 125.74 ha of HCV 5,6 and 93.50 ha of HCV 4 (riparian), Unit MS-3 : 1211.51 ha of HCV 1,2,3,4,5,6, riparian : 36,62 ha and swamp 257.68 ha.

Management plan year 2014 & 2015 and their implementation records was available such as monitoring of the quality of water on riparian areas dated on 18 May 2015, re-instalation of red pillars on riparian areas in division C1 & C2 dated on 10-11 February 2015, maintenance of posters/signboard about wild animal and protected fauna in MS-1 estate dated on 11-12 March 2015, re-socialization of HCV in MS1 estate dated on 15 May 2015. The company has carried out monitoring of HCV areas and RTE species example monthly re-port for May 2015. Management plan year 2015 has created based on results of monitoring relate of the sta-tus of HCV & RTE species and outcomes of monitoring year 2014.

The company has list of flora and fauna which available and protected in Central Kalimantan Project (CKP) – Wilmar International Group year 2014 (pne of company is PT Mustika Sembuluh). The company has carried out re-socialization of flora and fauna founded on MS areas to Pondok Damar village, Bangkal village and Pasit Putih village. The company has agreed with communities that the communities will inform/report to company if any/found the communities to capture, harm, collect or kill these RTE species. Re-socialization of HCV to employees has carried on dated on 11 June 2015 (MS-1 estate) such as HCV awarness, base and goal was done HCV assessment, regulations/roles in HCV areas, SOP no.20 (management of riparian areas), SOP no.18 (protection to wild animal and protected and RTE species include roles of vanism for employees or communities which capture, harm, collect or kill RTE species).

The company (MS1, MS2 and MS3 estate) have agreement/MoU (Memorandum of Understanding) with communities regarding safeguard HCV areas and these rights because location HCV areas set-asides or near with existing rights of local communities. Examples for MoU or agreement are MoU between PT Mustika Sembuluh with community in Pondok Damar village dated on 13 November 2009, in Bangkal village dated on 17 December 2009, dated on 16 October 2009 with one of communities in Tanah Putih village, etc regarding management of traditional right and HCV areas.


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

Findings :

Waste management is consistently carried out by the company in accordance with the relevant regulations. Permit of Temporary Storage of Hazardous and Toxic Waste which is owned by the company is Surat Izin Bupati Kotawaringin Timur No. 660/08.1/BLH/IX/2011 dan No:660/535/BLH-Ek.SDA/VIII/2014 tanggal 6 Agustus 2014. Hazardous waste temporary storage permit is valid for 5 year.The company always report eve-ry three months Badan Lingkungan Hidup Kabupaten Kotawaringin Timur and Kepada Kepala Badan Ling-kungan Hidup Provinsi Kalimantan Tengah,. Last quarterly report on 21 April 2015

In addition to the company do reuse, reduce and recycle, the company is also working with third parties, namely PT Maju Utama Jaya Asri, and licenses and permits have been verified. including the MoU PT Maju Utama Jaya Asri with “Pengumpul/Pengolah LB3”. For example is a memorandum of understanding with PT ALP Petro Industry for processing of used lubricant oils.

Each handover of Hazardous waste (LB3) to PT Maju Utama Jaya Asri is always documented. For example, handover of LB3 dated March 23, 2015, 12 Drum Used Oil and transported by truck No. DA 9171 AQ. Mean-while for medical waste, the company cooperated with hospitals Imanuddin Pangkalan Bun, and the last de-livery is dated March 4, 2015.



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Palm Oil Mill Effluent (POME) for POM 1 and POM 2, as already described previously, the company has a permit to use waste water (Land Application) from “Bupati Kota Waringin Timur No. 660/2161/BLH/II/2010 tanggal 4 Juni 2010” with an area 719 Ha, and the current license renewal is still in process in accordance with the letter No 26 / BM-MS / V / 2015 dated May 21, 2015 to “Bupati Kotim dan Kepala BLH Provinsi Kali-mantan Tengah”, While for the POM 2, is still in the stage of assessment in accordance with permit assess-ment “No. 660/227 / BLH-LA / 2013 Tentang Ijin Pengkajian Pemanfataatan Air Limbah Industri Pada Tanah Di Perkebunan Kelapa Sawit”

Implementation of the Land Application consistently monitored such as waste water quality and Soil Quality, conducted by internal and also external laboratories that have been accredited. This monitoring is reported quarterly to government. Last Reporting was done in April 2015. However at the WWTP Outlet Flow Meter is strongly recommended to be followed up immediately because it has passed calibration period from March in 2013


Criterian 5.4 Efficiency of fossil fuel use and the use of renewable energy is optimised

Findings :

The both mills (MS-1 POM and MS-2 POM) have made an increase the efficiency the use of fossil fuels and renewable energy optimizers. In year 2014, MS-1 POM make efficiency Rp. 1,177,126,440 where the total cost of the use of diesel (generator + turbine + biogas) is Rp. 40,148,900,505 and the total cost of the use of diesel (turbine + biogas) is Rp. 38,971,774,065. Whereas, year 2015 (January to May) that MS-1 mill make efficiency Rp. 680,291,330 where the total cost of the use of diesel (generator + turbine + biogas) is Rp. 6,258,769,217 and the total cost of the use of diesel (turbines + biogas) is Rp. 5,578,477,887.

The company (MS-1 & MS-2 mill) also monitors the use of fuel i.e diesel, shell and fiber year 2014. Volume of FFB processed year 2014 in MS-1 mill as much as 282,173,328 kg, total diesel fuel use as much as 106,380 liters, total use of shell as much as 19,758,886 kg, total fiber consumption as much as 45,163,167 kg so that total consumption of diesel/FFB processed is 0.00038 liters/kg of FFB and total use of shell + fiber/FFBs pro-cessed is 0.23008 kg. Whereas, MS-2 mill that volume of FFB processed as much as 11,817,922 kg, total use of fiber as much as 28,075,040 kg so that total consumption of diesel / FFB processed is 0.00103 liters / kg of FFB and total use of shell + fiber/FFB processed is 0.22735 kg.

Volume of FFB processed year 2015 (January to May) in MS-1 mill as much as 129,377,790 kg, total diesel fuel use as much as 85,560 liters, total use of shell as much as 9,017,919 kg, total of of fiber consumption as much as 20,612,386 kg so that the total consumption of diesel/FFB processed is 0.00066 liters/kg of FFB and total use of shell + fiber/FFB though is 0.22902 kg. Whereas, MS-2 POM was FFB processed as much as 80,794,580 kg, total diesel fuel use as much as 58,854 liters, total use of shells as much as 5,603,776 kg, to-tal use of fiber as much as 12,917,132 kg so that total consumption of diesel / fresh fruit bunches processed is 0.0007 liters / kg fresh fruit bunches and total use of shell + fiber / fresh fruit bunches processed is 0.22923 kg.


Criterian 5.5 Use of fire for preparing land or repl anting is avoided, except in specific situations as identified in the ASEAN guidelines or other regional b est practice

Findings :

The company has procedures for Land Clearing and Preparation. In the procedure regulated about of land clearing with the Green Stacking (Zero Burning). The company carries out of land clearing by using a me-chanical device and not burning. This can be known from the minutes of the land stacking activity. For exam-ple in MS-1 there is a recording minutes of activity by using the excavator of land clearing ie Block 263: 33.75 Ha, block 277: 8.01 Ha, block 293: 3.29 Ha, block 294: 3,7 Ha, block 149 : 17.48 Ha, block 549: 12.99 Ha, block 349: 3,24 Ha, block 301: 24.94 Ha and block 214: 6.74 Ha.



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The company has set up a workflow for land fire emergency prevention including person in charge in each stage. Each unit formed emergency response teams composed of head, secretary, emergency prevention section, rescue section, safety section, paramedic section, investigation section, communication section and recovery section. Fire prevention equipment has already installed both in the mills and the field such as hy-drant, fire extinguishers, water pump, hose, fire-fighter clothing, and also fire fighting vehicles equipped with nozzle. Most of the equipment in good condition and works properly.

Training and fire simulation conducted regularly in each unit, based on minute’s record there are some fire ex-tinguisher and hydrant training and fire simulation (fire drill) practiced on 18 March 2015 at unit MS 1, fire ex-tinguisher and hydrant training on 18 March 2015 at POM-1, fire extinguisher on 11 June 2015 at POM-2 and hydrant training on 30 June 2015 at POM-2.

At the time of the audit carried out no re-planting activities at the sites (nucleus and smallholder areas)


Criterian 5.6 Plans to reduce pollution and emissio ns, including greenhouse gases, are developed, implemented and monitored

Findings :

There was sighted evidence of proper implementation of waste management, as all waste and pollutions sources both from the mill and estate (nucleas and smallholder) are identified and documented as recorded on waste management document including such as contaminated fiber, used rough mops, oil spillage in ker-nel station, calcium carbonate (CaCO3) spillage, boiler emissions, etc. Waste management activities are done through separation between hazardous waste and non-hazardous waste. Hazardous waste collected in the workshop warehouse include used oil, used batteries,used rough mops, used filter oil, copy toner etc. The company assigned a licensed waste collector.

The company (estates & mills) has identified significant pollutants and greenhouse gas (GHG) emissions such as CO2, CH4, HCFC, and N2O and plans to reduce or minimise them (include objective, targets and time-lines) example using renewable energy in mills, methane capture in MS-1 mill, apply of fertilizer appropriate with procedures, maintenance of truck, exam of vehicle emission, etc.

PalmGHG summary report for MS-1 & MS-2 mill was available where using appropriate tools i.e RSPO Palm GHG calculator version 2.1.1. The Result of monitoring regarding final emissions at MS-1 mill is 0.52 tCO2e/t CPO or PK, whereas at MS-2 POM is 4.53 tCO2e/t CPO or PK.


Principle 6: Responsible consideration of employees and of individuals and communities affected by growers and mills

Criterian 6.1 Aspects of plantation and mill managem ent that have social impacts, including replant-ing, are identified in a participatory way, and pla ns to mitigate the negative impacts and promote the positive ones are made, implemented and monitored, to demonstrate continual improvement Findings : Company has conducted Social Impact Assessment and has also developed Social Impact management Plan 2010 – 2015. This document’s scope only covering Mill 1, MS Estate 1, 2, and 3, not yet cover up the Mill 2. In this re-certification audit found that MS has conducted social impact assessment for Mill 2 and develop the documents in 2014. The Social Impacts assessments have involving affected parties by two approaches, meeting/discussion and data collections with questionnaires. Social impacts management plan for 2014 – 2018 has developed as the part of SIA document. Records regarding local community involvement in social impacts assessment process have been shown during audit, such as meeting attendant list and filled ques-tionnaires.

As the result of last audit, there is a Social Impact Assessment Report of smallholder estate done by Remark Asia in 2013. This report consist of positive and negative impact of the existing oil palm plantation. The positive impact among others is increasing of community income, working opportunity. The negative impact is reducing area for traditional cultivation activities such as paddy field and some vegetables. There was evi-



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dence of stakeholder participation in attendants list on December 2013. And also there was evidence of the stakeholder participation during socialization of monitoring and management plan for identified social impact


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

Findings :

There are some procedure has developed and held by the company regarding stakeholder consultation and communication. All procedures has documented as SOPs such as: a. SOP44/PR/3/0213, issued in May 5th 2015, regarding “Dedicated officer responsible for consultation and

communication with stakeholder”. b. SOP 47/PR/3/0414, issued in May 5th 2015, regarding “Transparency”. c. SOP 35/PR/1/0614 rev. 02, issued in May 5th 2015, regarding “Mechanism of Stakeholder communication

and Consultation”.

All of documents completed with detail information regarding procedures, flowcharts and officer who respon-sible in communication process has been communicated to stakeholders. The company also has a schedule for planned meetings with surrounding communities in Pondok Damar, Bangkal and Tanah Putih Villages. There is evidence that the meeting was conducted every once a year with the main agenda is introducing new officers to stakeholders. All of communication process has recorded and maintained by the company. Local community leader from 2 villages (Pondok Damar and Tanah Putih) has been interviewed during recertifica-tion audit. They gift confirmation that MS management has always conduct routine meeting with them dis-cussing any kind of social issues especially introducing the new officer for PR and CD/CSR.


Criterian 6.3 There is a mutually agreed and docume nted system for dealing with complaints and grievances, which is implemented and accepted by al l affected parties

Findings :

There is a procedure open to all affected parties for grievances, complaints and dispute resolutions process. The procedure documented as SOP 34/PR/1/0614 rev. 02, issued in May 5th 2015, regarding “Mechanism of Complaints and Grievance Acceptance, and conflict/dispute Resolutions”. This document has also communi-cated to stakeholders at the same time with other procedure socializations.

Officers responsible for this mechanism has specifically appointed as mentioned in SOP44/PR/3/0213, rev 5, issued in May 5th 2015 and has been gift a specific social impact mitigation training for them. The officers are: a. Public relation Officers:

- Senior Manager : Juatku Antono S.HUT - Staff : Ari Wibowo, Rahmad SG, Jhoni S, Yulius P, Ahmad J N, Immanuel PAB, Ahmad Fauzi, Engkai

Kurnianto b. Legal and land acquisitions Officers:

- Manager : Andy Ayyub - Staff : M Taufiq, Rambet, Bayan ME, Supardi, Ratnue, Kamseno, Joko AS.

This procedure only covers complaints and grievance from external stakeholder but not internal stakeholder. As mentioned in Company’s regulations, internal stakeholder (workers) could deliver their aspirations by two channels, directly to their supervisor and trough Bipartite Associations Body (LKS Bipartite). These two channels has effectively use by internal stakeholder to speak up their aspirations.


Criterian 6.4 Any negotiations concerning compensati on for loss of legal, customary or user rights are dealt with through a documented system that ena bles indigenous peoples, local communities and other stakeholders to express their views through t heir own representative institutions



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Findings :

Company has documented procedures regarding grievances and complaints mechanism; land dispute; and land acquisition. Detail mechanism for those three procedures describe as follows :

a. SOP 34/PR/1/0614 rev. 02, issued in May 5th 2015, regarding “Mechanism of Complaints and Grievance Acceptance, and conflict/dispute Resolutions (outside legal actions)”. This SOP define some key process such as : - All complaints in written form deliver to Estate/Mill manager and forward to regional Office. - Complaints will register and categorized based on subject matters. - Coordinated with related department to identify the problems, then open communications with related

stakeholders - Conducted mediations and legal actions if only there are no agreements between company and re-

lated stakeholders

b. SOP 30/BM/(0)/0409, issued April 13th 2009, regarding “Land Dispute Resolutions”. This SOP define some key process such as : - Main issues causes to land dispute - Land Dispute as latent problem for every plantation - Land dispute characteristics, categorized into to kind, customary land dispute and villages land and

land dispute with incomer - Guidance for Conflict resolutions.

c. SOP 29/BM/(0)/0409, issued April 13th 201309, regarding “Technical Guidance for Land Acquisitions”. This SOP define some key process such as: - The origin of the related land - Land title - RSPO P&C as guidance - Definition of land use, and land acquisitions - Mechanism of land acquisitions and compensation payment

During re-certification audit, company has shown their archives documents and records regarding agreements and compensations process. The documents are well maintained by PR and Legal department. At the latest land dispute resolution process between MS and community members of Pondok Damar, company officer have involving local head of customary leader as mediator. This local community leader has strategic role because he has both formal and traditional authority regarding land dispute resolution process in this area as define by Governor Regulations Number 13 year 2009 regarding “Customary land and Customary Rights in Central Kalimantan Province.

Deeply Checking into those three procedures found that : - A specific mechanism/methods for identifying and verification of customary land and rights has not clearly

mentioned in this three procedures. Company has not yet showed specific evidences regarding how to conduct identification and verification for legal and custamary land that considered the Governor Regula-tion 13/2009. This regulation empahsize the importance roles of Dayak Custamary Board (Dewan Adat Dayak) as the official body appointed by the governor.

- The officer responsible to open communication and negotiations with related stakeholder regarding land dispute has no enough authority to make decisions (as one of stakeholder consultation issues)

This was rised as non-compliance (NCR No.2015-13 of 18) .




mentioned in this three procedures. Company has not yet showed specific evidences regarding how to conduct identification and verification for legal and custamary land that considered the Governor Regula-tion 13/2009. This regulation empahsize the importance roles of Dayak Custamary Board (Dewan Adat Dayak) as the official body appointed by the governor.

- The officer responsible to open communication and negotiations with related stakeholder regarding land



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dispute has no enough authority to make decisions (as one of stakeholder consultation issues)

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

Findings :

There some payment and conditions scheme for workers in Mustika Sembuluh. Based on Company Regula-tions 2015, article 5, company : a. Permanent Worker (PKWTT – Working Contract Agreement with un-defined Duration)

- Staff - Payroll or monthly rate worker - Daily rate Worker

b. In-Permanent Worker (PKWT – Working Contract Agreement with specific duration). - Contract worker - Migrant worker (Expatriate)

Company has developed payment structures and scales for every kind of worker and always responds to lo-cal governance regulation regarding minimum wage payment. There were evidences showed during audit such as: a. Governor of Central Kalimantan Official Letter regarding minimum wage payment, state that the minimum

wage for plantation 2015 is IDR 2.110.500,- b. Pay slips for PKWTT and PKWT workers of Mill 1, Mill 2, MS1 Estate, MS2 Estate, and MS3 Estate.

Cross check to these documents and records found that company still comply with regulations (for monthly rate and daily rate worker), regarding minimum wage payment sectoral for district (UMSK).

Every PKWTT and PKWT worker has hold contract agreement with company and part of scope of company regulations. The company regulations that has been registered to Local Office of Social and Manpower in April 2015 determined all workers obligations and rights that has refer to local and national labor regulations, such as: a. Working relations b. Paid and un-paid Day off and Leave permit c. Payment d. Worker facilities e. Layoffs termination f. Complaints and Grievance mechanism

Document check into overtime forms and payment calculations for daily rate worker found that company shows their compliance to regulations. During document check regarding overtime issues, there is an evi-dences showed that consist piece rate workers norms (Mature Field Operation, Contract and labor Rate 2014 and 2015). Based on this document, Company doesn’t apply any piece rate differentiations between regular day and holiday. This norm is not complying with national regulations regarding overtime payments. Check-ing into harvester workers diaries found that some of them have work in Sunday (holiday) but paid in the same rate as they work in regular day. This finding rise as non-compliance (NCR No.2015-14 of 18).

Company Regulations 2015 article 21 mentions about company’s facilities for worker. The points regarding facilities as mentioned are: a. Company provides housing, electricity and water for workers and family members (nuclear family) that

live in the plantations area b. Company provides worker public facilities such as clinic, worshipping houses, sport areas etc.

Check into documents and records found that MS has built adequate housing facilities for worker, and provide adequate electricity and water. Field check and interview with worker’s spouse found that company routinely maintain the facilities keep in order.

Every complaint from housing residents regarding worker facilities is responded properly. Every local hous-ing has an officer who responsible for maintenance management. Field Check on MS3 emplacement, Bedeng C found that worker’s house is leak and not yet been repaired event the grievance has reported three times. This was rised as non-compliance (NCR No.2015-15 of 18).

MS Plantations area is not too far from local economic center (market etc.). Small shop supplying workers



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everyday needs of consumptions are available in every emplacement. Food is adequately, sufficiently and af-fordably supplied by these local shops, there is no restriction from the company for worker to build a shop in housing facilities areas. To improve worker access to adequate food supplier, company has built Workers Cooperation that could accessed by all workers, member or non-member. The shop owned by the Coopera-tion is available in every Estate office.


NCR No.2015-14 of 18 (Indicator 6.5.2 as Major non-conf ormity) Based on document “Mature Field Operation, Contract and labor Rate 2014 and 2015”, Company doesn’t ap-ply any piece rate differentiations between regular day and holiday. This norm is not complying with national regulations regarding overtime payments. Checking into harvester workers diaries found that some of them have work in Sunday (holiday) but paid in the same rate as they work in regular day.

NCR No.2015-15 of 18 (Indicator 6.5.3 as Minor non-conf ormity) Field Check on MS3 emplacement, Bedeng C found that worker’s house is leak and not yet repaired event has been reported three times.

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

The company still maintain the policy for worker’s freedom association. During this recertification, audit evi-dences collected regarding policy’s socializations. Printed document policy of worker’s Freedom of Associa-tions, the hardcopies has attached to every board in Estate and Mill Offices. This is one of effective way to socialize the policy to staffs and workers.


Criterian 6.7 Children are not employed or exploited

Findings :

Document check and field check found that there is no presence of child workers found in this company. Child worker restrictions has documented in Company’s Policy. It Also has strictly mentioned in Company Regulations 2015, article 3, point 2, that state “Company has commitment to not recruit workers under 18 years old”. This regulations also documented in recruitment procedures.


Criterian 6.8 Any form of discrimination based on ra ce, caste, national origin, religion, disability, g en-der, sexual orientation, union membership, politica l affiliation, or age, is prohibited

Findings :

There is no evidence of discrimination in this company. Workers come from various ethnic groups in Indone-sia such as Java, Dayak, Malay, Batak, and others. The workers also come from various religions. Interview with maintenance worker and harvester worker confirmed that there is no indication found in working areas and emplacement areas showing discrimination issues among worker and staffs. This policy has also clearly stated at Company Regulation 2015, article 3, point 7, “Company open equal opportunity to each individual person with respects, dignity, free from discriminations based on gender, race, ethnic, religion and believe backgrounds”. Audit evidences regarding recruitment procedure and process shows that company still keeps their commitment.



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Criterian 6.9 There is no harassment or abuse in th e work place, and reproductive rights are protected

Findings :

Company maintains policy against sexual harassment and violence, the printed documents attached at boards in every office, estates and Mill. This policy has also clearly stated at Company Regulation 2015, arti-cle 3, point 3, “Company supporting (encourage) efforts to prevents, reports and actions over sexual harass-ment and violence”. As implementations of the policy, company showed documents and records of Gender Committee Structure and activities (meeting and socializations). Special procedure has developed to ac-commodate complaints and grievances regarding these issues.

There is evidence of information provided to workers during morning roll call regarding the company’s policy against sexual harassment and violence. Interview result with maintenance workers (women) found that they already know the policy, and where to reports if there’s any case happens in fields. Interview result with of-fice workers found that they know person incharge regarding gender committee and they know and utilize their reproductive rights. Evidences such as filled H1 form (Leave for period) and H2 form (maternity leave) has showed during audit.


Criterian 6.10 Growers and millers deal fairly and transparently with smallholders and other local businesses

Findings :

FFB Prices of Mustika Sembuluh determines by marketing manager/officer of Head Office. The manager formulate the FFB prices based on CPO and FFB market prices and local the prices issued by FFB Prices Board. The buying price information then, distribute to mills (by email) and suppliers (by SMS). The current FFB prices also attached (sign board) at Mills. During audit, company shows their buying prices for 2 past months detail for each days and each planting year.

Every FFB supplier holds contractual agreement with company. There is evidences shown during audit re-garding administrative requirement for FFB Supplier, such as: a. FFB Supplies Contractual Agreement (with IWS); b. List of grower detailed with areas and production forecast; c. Supplier Invoice to company; d. Pay-ment slip. Interview result with the supplier found that company always distributes the FFB prices information routinely. There is no problem regarding FFB unloading and calculation process. On the other hand, during interview process the supplier showed evidence that company has made late payments for the last three months. This finding rise as non-compliance (NCR No.2015-16 of 18) .


NCR No.2015-16 of 18 (Indicator 6.10.4 as Minor non-con fprmity) During interview process, supplier showed evidence that company has made late payments for the last three months

Criterian 6.11 Growers and millers contribute to lo cal sustainable development where appropriate

Findings :

As stated at Company Regulations 2015, article 3, point 5, company has commitment to contribute to local development by developing Community Development Program. Audit evidences such as Document of CD/CSR Program 2014 and 2015, records of implementations, meeting records and payments slips. The CD/CSR program has considered SIA Documents, company’s operation areas as group and stakeholder



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consultation result. CD/CSR program activities that has implemented in 2015 are: a. Education (Incentives for In-permanent Teachers) b. Socials c. Religious (Rehabilitation of Local Public Facilities) d. Economic

For all those 4 kind of activities, company has contributed around 129 million to local community develop-ment.

Deep check to the SIA Documents and CD/CSR program found that there is less harmony between compa-ny’s efforts to mitigate social impact especially regarding land problem with CD/CSR program. CD/CSR activ-ities have not yet dedicated to avoid and mitigate social conflict. On the other hand, there’s no program that dedicated to generate income for local communities. This situations rise as observation .

Compliance status : Compliance with observation

Criterian 6.12 No forms of forced or trafficked labo ur are used

Findings :

PT Mustika Sembuluh only recruit migrant worker for managerial positions (staff up – expatriate), there’s no migrant worker that work at low level positions. All of harvester and maintenance worker (permanent and in-permanent) are Indonesian, thus there’s no trafficked labor are use. There’s also no substitute contract oc-curred


Criterian 6.13 Growers and millers respect human ri ghts

Findings:

Human Rights policy has clearly state by the company In Company Regulation 2015 article 3. Human Right policy as state by UN guiding principle on Business and Human Rights has detailed into 7 points. This state-ment has cover issues such as: a. Commitment to provide comfortable working environment b. Commitment to employ worker over 18 years old c. Prevent, report, and handling sexual harassment and violence cases (if any). d. Commitment to transparency e. Commitment to contribute to local development f. Commitment to environment sustainability g. Commitment to equal opportunity

Freedom for associations has state as special documented policies. All of this commitment regarding human rights has been communicated to all level of workers


Principle 7: Responsible development of new planting s

Criterian 7.1 A comprehensive and participatory inde pendent social and environmental impact as-sessment is undertaken prior to establishing new pl antings or operations, or expanding existing ones, and the results incorporated into planning, managem ent and operations Findings:

No new development area period of year 2014 to 2015 in nucleas areas so the information is still same as with previous surveillance audit that this is criterion not applicable.



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Compliance status : Not Applicable (N.A)

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

Findings:



Criterian 7.3 New plantings since November 2005 have not replaced primary forest or any area re-quired to maintain or enhance one or more High Conser vation Values

Findings:



Criterian 7.4 Extensive planting on steep terrain, and/or marginal and fragile soils, including peat, is avoided

Findings:


Compliance status : Not Applicable (N.A) Criterian 7.5 No new plantings are established on lo cal peoples’ land where it can be demonstrated that there are legal, customary or user rights, wit hout their free, prior and informed consent. This i s dealt with through a documented system that enables these and other stakeholders to express their views through their own representative institutions Findings:


Compliance status : Not Applicable (N.A) Criterian 7.6 Where it can be demonstrated that loc al peoples have legal, customary or user rights, they are compensated for any agreed land acquisitio ns and relinquishment of rights, subject to their free, prior and informed consent and negotiated agr eements Findings:





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Criterian 7.7 No use of fire in the preparation of n ew plantings other than in specific situations, as identified in the ASEAN guidelines or other regional b est practice

Findings:



Principle 8: Commitment to continuous improvement in key areas of activity

Criterian 8.1 Growers and millers regularly monitor and review their activities, and develop and im-plement action plans that allow demonstrable contin ual improvement in key operations

Findings:

The company (estate and POM) has a continuous improvement action plan. The continuous improvementac-tion plan for estate is to the reduction of herbicide, LB3 reduction, reduction in fuel consumption, reforesta-tion, reduction in the use of fertilizers containing N, P2O5, K2O, CaO, MgO, Na and prevention and control of fires.

The company has developed questionnaire and conducted surveys (every year) for collecting data from local communities. The questionnaire contained questions regarding social issues impacted by Company such as working opportunity, income, perceptions, grievances, local norm and values, social process and community health status. Data collected has been analyzed as inputs for the formulation process of Social Impact Moni-toring and Evaluation Report.

Company could show evidences that they have routine meeting with stakeholders (Pondok Damar, Tanah Putih and Bangal). As mentioned in meeting records, the agenda was introducing new procedure, new officer and socialization regarding environmental and social impacts monitoring activities. By this meeting, stake-holders could continuously update information according to the dynamic of company’s activities and its im-pacts. Compliance status: Full Compliance

• RSPO SCCS

Mustika Sembuluh Palm Oil Mill (MS POM) is located in Central Kalimantan - Indonesia. Mustika Sembuluh Mill 1 (POM 1) was established in 2006 with a processing capacity of 120 tonnes FFB/hours (revision of permanent bus-siness permit (IUT) and plantation business permit (IUP) in process). The location of Mustika Sembuluh Palm Oil Mill 1 (POM 1) is within Mustika Sembuluh 1 (MS-1) of estate. Mustika Sembuluh Mill 2 (POM 2) was established in 2013 with a production capacity of 90 tonnes FFB/hours. The location of Mustika Sembuluh Palm Oil Mill 2 (POM 2) is within Mustika Sembuluh 3 (MS-3) of estate.

The company implements SCC-RSPO with “Mass Balance (MB)” model according to the nature of mill FBB sup-ply condition. The following is a description of the company’s supply chain management system according to the RSPO SCCS requirements (it was assessed/audited against Module E), including status of compliance of the company and their outsourced third parties to RSPO SCCS requirements. Results of audit/assessment as de-scribe on the explaination belows :

Module E – CPO Mills: Mass Balance

E.1. Definition



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Findings:

The organization (MS-1 & MS-2 Mill) was implemented the RSPO-SCCS Mass Balance (MB) model since get certificate. This SCCS model allowed to mixing of certified and uncertified product but shall be control by the Mass Balance record to ensure the quantity of certified product, and only certified product could be claim by the organization as certified palm oil product. Organization has identified the volume of certified and uncerti-fied FFB supplied to the mill. Based on record of Mass Balance showed the amount of FFB certified and un-certified, when the certified FFB is come from PT Mustika Sembuluh, Bita Maju Bersama Cooperative, PT Ker-ry Sawit Indonesia, PT Bumi Sawit Kencana and PT Sarana Titian Permata. Whereas, uncertified FFB is come from PT Rimba Harapan Sakti, and Independent outgrowers.

Based on Table 3 that MS-1 & MS-2 Mill was received certified FFB year 2014 is approximately 410,754.88 tons of FFB (99.63% from the total of FFB received in once year) and uncertified FFB is approximately 1,541.53 tones (0.37%). MS-1 & MS-2 Mill only produced Crude Palm Oil (CPO) and Palm Kernel (PK).

Mass balance record in both mills also showed the certified product. In year 2014 that certified CPO are 90,651.99 tonnes (99.63%) and uncertified CPO is 335.52 tonnes (0.37%). Whereas, certified PK are 18,253.67 tones (98.73%) and uncertified PK are 234.57 tones (1.27%). Compliance status : Full Compliance

E.2. Explanation

Findings:

The projections of certified CPO and PK year 2014 are 101,250 MT and 19,967 MT. The realization of certi-fied product sold is 11,851.05 MT (PK) and null (CPO) by e-Trace platform but all transactions of certified PK sold starting April 2015 was not available in e-Trace. This condition was raised as non-conformity (NCR No.2015-17 of 18 ). Whereas, projection of certified product year 2015 are 104,688 MT (CPO) and 20,720 MT (PK) with projection of FFB process is 436,200 MT and extraction rate are 24.00% (OER) and 4.75% (KER).

Register in eTrace on behalf PT Mustika Sembuluh (MS-1 & MS-2 POM). Compliance status : Non Compliance

NCR No.2015-17 of 18

All transactions of certified PK sold starting April 2015 was not available in e-Trace.

E.3. Documented procedures

Findings:

The company (POM 1) has a procedure for implementation of SCCS requirements. There are a set of existing procedure consisting of :

1. Procedure for receiving FFB (SOP/MSPOM-LOG-003 Rev.01, issued on July 19, 2012),

2. Procedure for receiving outside FFB crop (SOP/MSPOM-LOG-004 Rev.01, issued on July 19, 2012),

3. Procedure for the purchasing administration of FFB (SOP/MSPOM-LOG-002 Rev.04, issued on July 19, 2012),

4. Procedure for supply chain mass balance model (SOP/MSPOM-LOG-014 Rev.03, issued on June 05, 2013),

5. Procedure for the selling CPO (SOP/MSPOM-LOG-005 Rev.01, issued on July 19, 2012),

6. Procedure for the selling PK (SOP/MSPOM-LOG-006 Rev.01, issued on July 19, 2012),

7. Procedure for over production (SOP/MSPOM-LOG-003 Rev.01, issued on July 19, 2012),

8. Procedure for administration of sales (SOP/MSPOM-LOG-007 Rev.01, issued on July 19, 2012),

9. Procedure for uploading with the selling of Loco and Franco (SOP/MSPOM-LOG-012 & 013 Rev.01, issued on July 19, 2012),



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10. Procedure for sounding and reporting 501 (SOP/MSPOM-LOG-008 Rev.01, issued on July 19, 2012),

11. Procedure for storage tank operation (SOP/MSPOM-LOG-009 Rev.01, issued on July 19, 2012),

12. Procedure for filling in kernels into sacks (SOP/MSPOM-LOG-010 Rev.01, issued on July 19, 2012),

13. Procedure for the washing of storage tanks (SOP/MSPOM-LOG-011 Rev.01, issued on July 19, 2012),

14. Procedure for weighbridge operation (SOP/MSPOM-LOG-001 Rev.02, issued on July 19, 2012),

15. Procedure for control of documents (SOP/MSPOM-MR-001 Rev.01, issued on July 19, 2012).

16. Procedure for FFB tolling process (titip olah) (MSPOM-LOG-015, issued on August 1, 2014).

Whereas, in POM 2 has a procedure for implementation of SCCS requirements too, consist of :

1. Procedure of for weighbridge operation (SOP/MS2POM-LOG-001)

2. Procedure for the receiving administration of FFB (SOP/MS2POM-LOG-002)

3. Procedure for receiving FFB (SOP/MS2POM-LOG-003)

4. Procedure for administration of sales (SOP/MS2POM-LOG-004)

5. Procedure for despatch CSPO/Non CSPO (SOP/MS2POM-LOG-005)

6. Procedure for supply chain mass balance (SOP/MS2POM-LOG-006)

7. Procedure for general administrasi of logistic (SOP/MS2POM-LOG-007)

8. Procedure for sounding and reporting 501 (SOP/MS2POM-LOG-008)

9. Procedure for despatch PK (SOP/MS2POM-LOG-009)

10. Procedure for upload with selling of LOCO (SOP/MS2POM-LOG-010)

11. Procedure for upload with selling of FRANCO (SOP/MS2POM-LOG-011)

12. Procedure for upload of POM/PP (SOP/MS2POM-LOG-012)

13. Procedure for storage tank operation (SOP/MS2POM-LOG-013)

14. Procedure for the washing of storage tanks (SOP/MS2POM-LOG-014)

15. Procedure for calibration (SOP/MS2POM-LOG-015)

16. Procedure for filling in kernels into sacks (SOP/MS2POM-LOG-016)

17. Procedure for receiving outside FFB crop (SOP/MS2POM-LOG-017)

18. Procedure for grading (SOP/MS2POM-SRT-001)

19. Procedure for appointment of management representative (MR) (SOP/MS2POM-MR-002)

20. Procedure for vehicle inspection (SOP/MS2POM-SEC-003)

21. Procedure for making, controlling and revision of document (SOP/MS2POM-DC-001)

22. Procedure for FFB tolling process (titip olah) (MS2POM-LOG-018, issued on August 1, 2014)

Inside the FFB tolling process procedure has explained i.e : • FFB certified on the “tolling process’ status was not recognized as FFB certified by POM, • Sales or dispatch or product as the RSPO certified product if it raw material are own property whereas the

raw material with the tolling status not allowed/permitted as RSPO certified product by POM and • If the mill is being broken, handling or manage of FFB in loading ramp i.e carry out transfer of FFB to other

mill and mill writing the name of FFB contributor on FFB delivery note.

and the revision of sell administration procedure in MS2 POM regarding delivery order or contract must be product category and supply chain model information.

The name of the person having overall responsibility for and authority over the implementation of these re-quirements and compliance with all applicable requirements has been assigned at the audit time. The organi-zation SCCS (consist of mill head, MR, head of administration, logistic, weightbridge operator, document con-trol, secutiry and assisten supervisor laboratorium) and personnel of MR in PT Mustika Sembuluh POM 2 did not change/same as previous audit except mill head since May 01, 2013 and MS-1 mill too.

In mill 1, according to internal memo No. 04/MS-Mill/IOM/VI/2012 issued on June 26,2012 the company assign one of workers as Management Representative (MR) for SCCS in PT Mustika Sembuluh mill. The duties and responsibilities of MR are set out in document no. JD/MSPOM-MR-001 Rev.02, issued on July 26, 2012. Whereas, in mill 2, according to internal office memo No.03/MS2-MILL/IOM/V/2013 issued on May 01, 2013, the company assign one of workers as Management Representative (MR) for RSPO P&C and RSPO SCCS in PT Mustika Sembuluh mill 2.



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PT Mustika Sembuluh mill has a procedure for reception of FFB (SOP/MSPOM-LOG-003 Rev.01 and SOP/MS2POM-LOG-003) and procedure for receiving outside FFB (SOP/MSPOM-LOG-004 Rev.01 and SOP/MS2POM-LOG-017). The procedure describes instructions for receiving and processing certified and non-certified FFBs.

Compliance status: Full Compliance

E.4. Purchasing and goods in

Findings:

PT Mustika Sembuluh Palm Oil Mill (POM 1 & POM 2) has a mechanism to receive FFB both from certified sources and non-certified sources. The document to be verified from certified sources are : material delivery letter (Surat Pengantar Buah) including name of estate origin and barcode code for material delivered letter. Based on name of estate origin then weighbridge operator ensure that name of estate origin include in the list certified suppliers. If include in the list certified suppliers then it is status is FFB certified. Certification status will be stated on ‘Incoming Certified FFB Received’ report (daily, monthly and three monthly report) in weigh-bridge location as seen from sample documents e.g. FFB delivery note (Surat Pengantar Buah) from MS 2 & KSI 1 (POM 1) and MS 3 & KSI 2 (POM 2), Weighbridge Slip and FFB Grading Report. Non Certified status will be stated on “Incoming Non Certified FFB Received” report (daily, monthly and three monthly report) in weighbridge location as seen from sample documents e.g. delivery note (Surat Jalan), Weighbridge Slip and FFB Grading Report.

Year 2014 that in the POM 1, supply of FFB from MS (MS 1-3), PT Sarana Titian Permata and PT Kerry Sawit Indonesia estate are RSPO Certified FFB because PT Kerry Sawit Indonesia, PT Mustika Sembuluh and PT Sarana Titian Permata has RSPO P&C Certificate. Whereas, in the POM 2 that RSPO certified FFB came from PT Mustika Sembuluh, PT Kerry Sawit Indonesia, PT Sarana Titian Persada and PT Bumi Sawit Kencana. Non-certified FFB was received by both mills come from PT Rimba Harapan Sakti and Independent Outgrowers.

The based on table 3 that FFB receipt in both mill year 2014 amount of 349,311.61 tonnes from company owned estate, 3,786.29 tonnes from scheme smallholder (cooperative of Bita Maju Bersama), 57,808.80 tonnes from Wilmar’s group estate and 1,389.71 tonnes from independent outgrowers. Volume of FFB receipt from Wilmar’s group estate until June 2014 in both mills because FFB receipt status after June 2014 is tolling (MS1 & MS2 POM as processing services).

A person has been appointed to be responsible to check and ensure the FFB quality and quantity as per pur-chase documents.

According to FFB reception procedure (SOP/MSPOM-LOG-003 Rev.01 and SOP/MS2POM-LOG-003) and procedure for reception of outside (SOP/MSPOM-LOG-004 Rev.01 and SOP/MS2POM-LOG-017) the mecha-nism of receive FFB in mill is :

1) Security guard will check the FFB delivery letter or delivery note from the truck driver;

2) The truck’s driver shall doing weighing at weighbridge. Once done, the gross weight of the truck is taken;

3) At the time of doing weighing at weighbridge, the truck’s driver shall submit the FFB delivery letter or de-livery note to weighbridge operator. The weighbridge operator shall check whether the name of estate origin is include in the list certified suppliers or not. If included in the list certified suppliers and still valid then is the status is FFB certified.

4) Upon completion weighing of FFB load, the FFB shall be sent to loading ramp. The truck’s driver will un-load the FFB and will return to the weighbridge to be weighted again;

5) The weighbridge operator will then generate the Weighbridge Slip and this will be kept together with the FFB delivery note or delivery note;

6) A copy of the Weighbridge Slip will then be given to the driver and attached with the FFB delivery note or delivery note. Both documents need to be sent back to the estate office or seller office by the truck’s driv-er;

7) At the grading platform, the quality of FFB (e.g. fresh, unripe, under ripe, rotten bunch & etc) shall be graded & recorded on the FFB Grading report.



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The company (POM 1 & 2) has recapitulation of production report for year 2014 & 2015, including volumes of FFBs received which is separated into certified and non-certified FFB volumes. Total FFB received include of FFB certified and FFB non-certified in year 2014 and year 2015.

Compliance status: Full Compliance

E.5. Record keeping

Findings:

The company has established a mechanism for control and maintenance of the document and data control procedure No. SOP/MSPOM-MR-001 Rev.01 issued on July 19, 2012 (POM1) and SOP/MS2POM-DC-001 (POM2) and the retention time for all records and reports has defined for at least for five (5) years. The com-pany’s procedure for records keeping is applied, with evidence as follows : the company maintains records of weighbridge slips, FFB delivery note and FFB grading report and supply from MS 3 estate (POM 1) and supply from MS3 estate (POM2). All records (weighbridge slips, FFB delivery note and FFB grading report) collected or complied per month. Records on the quantity of FFB received and CPO/PK dispatched daily is maintained in the weighbridge software. The mechanism to update information about production (production CPO/PK, dispatch CPO/PK, stock CPO/PK, OER and KER) to related section is by email notification every morning by the logistic division. The mill maintains accurate, complete and updated records and reports.

The mill has records and balances of all receipts of RSPO certified FFB and deliveries of RSPO certified CPO and PK on daily, monthly and three monthly basis. The material balance includes information about incoming FFB (certified sources and non-certified sources), incoming FFB of processed, CPO production result, OER, delivered CPO, and balance stock. The mass balance report on year 2014 & 2015 on behalf MS-2 POM has received FFB from Wilmar’s group estate with tolling status but handling of information in mass balance report year 2014 and 2015 not appropriate/compliance with FFB tolling process (titip olah) (MSPOM-LOG-015). This is condition was raised as non-conformities (NCR SCCS No.2015-18 of 18 ).

All volumes of palm oil that are delivered are deducted from the material accounting system according to ac-tual daily conversion ratios. There are no outsourced supply chain processes in PT Mustika Sembuluh Palm Oil mill.

Compliance status : Non Complaince

NCR No.2015-18 of 18 MS-2 mill was received FFB from Wilmar’s group estate with tolling status but handling of information in mass balance report year 2014 and 2015 not appropriate/compliance with FFB tolling process (titip olah) (MSPOM-LOG-015).

3.2 Status of Previously Identified Non-conformities

A total of 17 nonconformances were identified during the 4rd surveillance assessment. These consisted of 7 major non-conformities and 8 minor non-conformities for RSPO P&C and 2 nonconformities for RSPO SCCS. During this surveillance assessment, it was found that there was sufficient evidence for closure of all non-conformities. The following is a description of the evidence of action taken to close the non-conformities raised during the previous assessment, as well as auditor’s conclusions on the status of the non-conformities.

• RSPO P&C

Criterion 2.1 (Indicator Major 1): Evidence of compliance with relevant legal requirem ents

NCR P&C No.2014-01 of 15

1. Some conditions are not compliances with regulation where were found during surveillance audit as exam-ple :



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• Minister of Manpower and Transmigration decree no. PER.09/MEN/VII/2010 dated on July 13, 2010 ar-ticle 23 that boiler and crane operator and OSH expert in electric section was experied their OSH li-cences (was experied since August 13, 2012, March 16, 2013, August 13, 2012, October 21, 2011 and March 18, 2014) and article 3 that one of them crane operator has not operator OSH licence in MS 1 POM.

• PiC of OSH in estate has not competency or training according Ministry of Manpower regulation

• PPE quality has been not refered/complied to Minister of Manpower and Transmigration decree No.PER.08/MEN/VII/2010 where the company should provide the standard Personal Protective Equip-ment and could be referenced to Indonesian National Standard (SNI) either American National Standart Institute (ANSI)

• Quantity and Item of drugs inside first aid box on the pesticide warehouse, laboratory, etc has not com-pliance with Minister of Manpower and Transmigration decree no. PER.03/Men/1982 and No.PER.15/Men/VIII/2008 because inside first aid box are 10 items only.

• OSH committee in MS1 POM has not approved by local government because there is not evidence that company has been request of approval to local goverment

• Auditee has been not sighted update of plantation business permit (IUP) and permanent business per-mit (IUT) revision process

2. The smallholder has not been complied with laws and regulation such as Ministry of agriculture decree no.98/Permentan/OT.140/9/2013 article 5 and local regulation of Central Kalimantan Province no. 17 year 2011 article 8 paragraph 2 (a) because plan of ownership land are freehold tittle

Verification results :

The auditee has provided some evidences i.e :

• The renew of operator permit letter (surat izin operator) for OSH license in MS1 POM has issued from local government are No.566.560/307/WAS-KK/SIO-PUBT/2014 (boiler operator), No.566.560/308/WAS-KK/SIO-PUBT/2014 (boiler operator), No.566.560/313/WAS-KK/SIO-PUBT/2014 (boiler operator), No.566.560/314/WAS-KK/SIO-PUBT/2014 (boiler operator), No.566.560/311/WAS-KK/SIO-PAA/2014 (wheel loader), No.566.560/312/WAS-KK/SIO-PAA/2014 (wheel loader), No.566.560/309/WAS-KK/SIO-PUBT/2014 (beckhoe operator) and No.566.560/310/WAS-KK/SIO-PAA/2014 (excavator operator). After re-verification with company document that crane operator has operator permit letter (surat izin operator) for OSH license from Ministry of Manpower and Transmigration No.13.13795-OPK3-PAA/II/2013 and electric operator still valid.

• OSH committee in MS1 POM has approved by local government in the form of head of social, man power and transmigration department of Kotawaringin Timur decree no.KEP.560.566/225/WAS-KK.P2K3/VI/2015 dated on 25 June 2015.

• Letter No.463/KJ/KIP/VI/14 dated on 10 June 2014 from provider public training company regarding the general OSH training could not carry out dated on 14 July 2014 but it was change be 11-21 August 2014, note of training, schedule of training, documentation or photograph, attendant list, inter-office memo no.09/RO-Sustainability/VII/2014 dated on 14 July 2014 that PiC of OSH from estate be one of participant and OSH expert card no.15879/PK3/AJ/62/2014/P0 from Ministry of Manpower and Transmigration.

• The list of 25 personal equipments with ANSI and SNI standard, Example: Safety Helmet with ANSI/SNI code is 034.303.061, 034.303.049 and 034.303.048. Internal memo issued by plantation head to affirm the implementation of Personal Protective Equipment (PPE). Monitoring logbook and list of 19 First Aid Kits/Box with complementary of photos of its contents.

• Form of monitoring of quantity and item of drugs inside first aid box in pesticide warehouse, office, laborato-ry, etc per first week of august 2014. In form of monitoring has sighted that quantity and item of drugs in-side first aid box complete according with manpower regulation. Moreover, photograph of quantity and item of drugs inside first aid has complete.

• Explaine note from plantation instation in Kotawaringin Timur District and investment board in Central Kali-mantan Province that request of revision of permit still in process/progress. During recertification audit that permit still in process/progress where based on statement letter from vice head of Kotawaringin Timur Dis-trict (on behalf head of Kotawaringin Timur) No.500/0642/Ek.SDA/IV/2015 dated on 8 April 2015. It was raised as observation.



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• Letter no.24/KBMB-PDM/MHU/VI/2014 dated on June 28, 2014 from cooperative of Bita Maju Bersama to Head of Seruyan District and forest and plantation instation in Seruyan District regarding request of planta-tion business permit for cultivation (IUP-B) with status of ownership legal land is land ownership letter (Su-rat Pernyataan Keterangan Tanah) from Head of Seruyan Sub District. It has received by local government with evidence of sign from receiver. During recertification audit that there are requirement of documents not available such as agreement between company with cooperative where known by local government (Se-ruyan District) and list of prospective farmers and prospective lands/areas (calon petani dan calon lahan) from Head of Seruyan District. It was raised as observation.

Auditor Conclusions : Closed with observation

Criterion 2.1 (Indicator Minor 1): A documented syste m, which includes written information on legal re-quirements that the palm oil company should comply with

NCR P&C No.2014-02 of 15

1. Some laws or regulations or convention not available in the list of laws and regulations such as :

• Law no. 19 year 2009 regarding ratification of Stockholm Convention On Persistent Organic Pollutans

• Regulation government no.81 year 2012 regarding management of domestic waste and waste as simi-lar domestic waste

• Environmental Agency decree no.5/2012 regarding type of business plan and or activities which manda-tory of environmental impact analyst

• Environmental Egency decree no.14 year 2013 regarding symbol and label of hazardous & tocix waste

2. Laws or regulations’s reference has not update or has experied in list of applicable legal and other re-quirement such as :

• Environmental agency decree no.KEP-05/KA BAPEDAL/1995 regarding symbol and label of hazardous & toxic waste

• Environmental agency regulation no.11/2006 regarding type of business plan and or activities which mandatory of environmental impact assassment analyst

3. The cooperative has not list of applicable laws and regulations that must be complied


List of laws and regulations in the environmental area with a number of documents: Form 02 / SOP 08 / CKP / (2) / 0111 revision 10 effective date May 1, 2015 prepared by the Environment Officer, inspected by Legal Of-ficer and approved by the General Manager. It has included such as Law no. 19 year 2009 regarding ratifica-tion of Stockholm Convention On Persistent Organic Pollutans, Regulation government no.81 year 2012 re-garding management of domestic waste and waste as similar domestic waste, Environmental Agency decree no.5/2012 regarding type of business plan and or activities which mandatory of environmental impact analyst and Environmental Egency decree no.14 year 2013 regarding symbol and label of hazardous & toxic waste. Inside list of laws and regulations in the environmental area that Environmental agency decree no.KEP-05/KA BAPEDAL/1995 regarding symbol and label of hazardous & toxic waste and Environmental agency regulation no.11/2006 regarding type of business plan and or activities which mandatory of environmental impact as-sessment analyst was changed/updated with new regulations are Environmental Agency No.14 year 2013 and Environmental Agency decree no.5/2012.

List of laws and regulations must be complied by cooperative was available where inside the list of laws and

regulations own company

Auditor Conclusions : Closed

Criterion 2.1 (Indicator Minor 2): A mechanism for en suring that compliance with relevant legal requirements is implemented



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NCR P&C No.2014-03 of 15

There is evidence that two of regulation not appropriate with existing condition such as Ministry of agriculture no. 98 year 2013 article 34 paragraph 1 and local government regulation of Central Kalimantan Province no.17 year 2011


During recertification audit that permit still in process/progress where based on statement letter from vice head of Kotawaringin Timur District (on behalf head of Kotawaringin Timur) No.500/0642/Ek.SDA/IV/2015 dated on 8 April 2015. It was raised as observation. Auditor Conclusions : Closed

Criterion 2.2 (Indicator Major 1): Documents showing ownership or lease of the land in accordance with relevant laws

NCR P&C No.2014-04 of 15

There are operational activities in outside company’s legal areas i.e harvesting FFB so it delivery to MS 2 mill on behalf MS 3 estate Verification results :

Auditee has provided a statement letter that company will not carry out operational activities on area it. It has been decided for smallholder areas by partnership scheme of nucleas with smallholder. During recertifcatioin audit that the company has not harvesting FFB in outside company’s legal and there is temporary boundary in the form of trench.


Criterion 3.1 (Indicator Major 1): Documents showing ownership or lease of the land in accordance with relevant laws

NCR P&C No.2014-05 of 15

The cooperative has not been financial projection or management plan at least 3 years


The auditee has provided management plan period of 2015-2019 for Cooperative of Bita Maju Bersama con-sist of area statement, maintenance & harvesting cost, FFB production, FFB price per tonnes, capital expendi-ture, and profit and loss analyst.

Auditor Conclusions : Closed Criterion 4.1 (Indicator Major 1 & 2): Standard Opera ting Procedures (SOPs) for estates, from land clearing to harvesting & Standard Operating Procedur es (SOPs) for mills, from reception of FFB to dis-patch of Crude Palm Oil and Palm Kernel Oil

NCR P&C No. 2014-06 of 15

There are several inconsistencies between procedures with implementation as example :

• Grading activity has not carried out according with grading procedure (SOP/MS2POM-SRT-001 Rev.0 dat-ed on November 1, 2012), it was found several data of FFB grading result in MS 2 POM on June 26, 2014 only used information from FFB delinery note only not form actual grading activities.

• The Temperature of digester for period of March to 25 June 2014 are 65-700C. Whereas, in SOP of screw press operational (SOP/MS2POM-PRS-005) that temperature must be controlled in the range 850C and SOP of digester operational (SOP-MSPOM-PRS-004) that temperature must be controlled in 900-950C.

• Application of selective spraying at block 107 not effective accordance with selective spraying procedure



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cause their objects still available.

• NPK fertilizer has implemented in smallholder areas on October 2013 and February 2014 but it fertilizer has not sampling fertilizer so that it condition not accordance with sampling fertilizer procedure (SOP-45/EMU/(0)/0709)

• There are spraying activities iIn riparian belt as HCV areas at block 911 (smallholder areas) this is incon-sistent with the relevant procedure.


The auditee has provided some evidences i.e : • The revision of FFB grading manual (POM-SOP/A rev.0 dated on January 16, 2014) about conduct of grad-

ing, sampling, method of grading (maturity, % losses fruit and waste) and reporting. Moreover, auditee has provided results of grading and photograph of grading process (step by step) in MS 2 POM.

• The records of digester repair and maintenance, and now the temperature control showed 90-950C but dur-ing recertification audit that actual temperature digester period of June 2015 in both mills still found not ap-propriate with procedure (400-700C). This condition was raised as non-conformity (NCR No.2015-05 of 18 ).

• The statement letter of spraying activities in division IIIB dated on July 05, 2014. The letter has inform of spraying tools as well as using relevant PPE such as masker, googles, apron, boot shoes and rubber gloves. Moreover, auditee has provided attendant list and photograph of spraying activities.

• To revise procedure (SOP-45/EMU/(0)/0709) including fertilizer activity for smallholder and issuing com-mitment letter to carry out analyst of fertilizer for smallholder in next time.

• The statement letter of HCV socialization to smallholder maintenance team (spraying & manuring) dated on July 8, 2014 where two of topic is HCV procedure relate of spraying and manuring activities and regulation in HCV areas that riparian belt not conduct spraying activities. Moreover, riparian belt in block 911 has planted vertiver grass on July 2, 2014 as one of activities to recovery of the riparian areas.

Auditor Conclusions : Open (NCR No.2015-05 of 18)

Criterion 4.2 (Indicator Minor 1) : Records of regula r soil, leaf, and visual analysis

NCR P&C No. 2014-07 of 15

Results of soil analyst were not available for smallholder areas


For Smallholder, sampling and soil type checking conducted on June 30, 2015. Sampling of soil for Smallhold-er conducted at 5 points, among others, Block 901 with coordinates 02º 40' 1.240 "(S) and 112º 34' 4.631" (E) with a depth of 0- 30 cm. Another sample point as in Block 911, with coordinates 02º 40' 29.372 "(S) and 112º 34' 27.977" (E). Auditor Conclusions : Closed

Criterion 4.3 (Indicator Minor 1) : Maps of fragile soils must be available

NCR P&C No. 08 of 15

The cooperative has not maps of fragile soils.


Based on result of soil analyst that type of fragile soils not available in smallholder areas. Auditor Conclusions : Closed



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Criterion 4.4 (Indicator Major 1) : Protection of wa tercourses and wetlands, including maintaining and restoring appropriate riparian buffer zones at or b efore replanting

NCR P&C No.2014-09 of 15

There are spraying activities on riparian belt in smallholder areas (block 911)


The auditee has provided evidence of HCV socialization to smallholder maintenance team (spraying & manur-ing) dated on July 8, 2014 where two of topic of socialization is HCV procedure relate of spraying and manur-ing activities and regulation in HCV areas that riparian belt not conduct spraying activities. Moreover, riparian belt in block 911 has been planted with vertiver grass on July 2, 2014 as part of riparian areas recovery pro-gram.


Criterion 4.7 (Indicator Major 2) : Responsible perso n for health and safety programmes are to be iden-tified and records of regular meetings to discuss h ealth, safety and welfare issues must be kept

NCR P&C No.2014-10 of 15

No evidence found during audit session that OHS certified expert attended OHS meeting in estate unit, she was only attend OHS meeting in Mill – 1 unit.


The company has provided minute of meeting from OHS committee (P2K3) dated on August 04, 2014 in MS1 estate and their attendand list. Inside in the minute of meeting and attendant list has informed OHS certified expert attended OHS meeting in estate unit.

Quarterly report of Unit MS-1 Estate P2K3 team to the local government manpower agency with complemen-tary of a receipt. The one of section is the minute of meeting, photograph and attendant list about OHS meet-ing.


Criterion 5.4 (Indicator Minor 1) : Records of monito ring renewable energy use and its efficiency analy-sis (energy/ton CPO, or energy/ton palm product)

NCR P&C No. 2014-11 of 15 MS1 POM do not have record of efficiency analysis for renewable energy use and methane capture use.


The company has made an increase the efficiency the use of fossil fuels and renewable energy optimizers. In 2014, POM-1 makes efficiency Rp. 1,177,126,440 where the total cost of the use of diesel (generator + tur-bine + biogas) is Rp. 40,148,900,505 and the total cost of the use of diesel (turbine + biogas) is Rp. 38,971,774,065.

The company also monitors the use of fuel ie diesel, shells and fiber in 2014. Total fresh fruit bunches pro-cessed in 2014 as much as 282,173,328 kg, total diesel fuel use as much as 106,380 liters, total use of shell as much as 19,758,886 kg, total fiber consumption as much as 45,163,167 kg so that total consumption of diesel / fresh fruit bunches processed is 0.00038 liters / kg of fresh fruit bunches and total use of shell + fiber / fresh fruit bunches processed is 0.23008 kg.

In 2015 (January to May 2015), POM-1 make efficiency Rp. 680,291,330 where the total cost of the use of diesel (generator + turbine + biogas) is Rp. 6,258,769,217 and the total cost of the use of diesel (turbines + biogas) is Rp. 5,578,477,887.



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The company also monitors the use of fuel ie diesel, shells and fiber in 2015. Total fresh fruit bunches pro-cessed in 2015 (January to May) as much as 129,377,790 kg, total diesel fuel use as much as 85,560 liters, total use of shell as much as 9,017,919 kg, total of of fiber consumption as much as 20,612,386 kg so that the total consumption of diesel / fresh fruit bunches processed is 0.00066 liters / kg of fresh fruit bunches and to-tal use of shell + fiber / fresh fruit bunches though is 0.22902 kg. Auditor Conclusions : Closed

Criterion 5.4 (Indicator Minor 2) : Records of monito ring of fossil fuels use for operational reason and its efficiency analysis

NCR P&C No. 2014-12 of 15 MS1 POM do not have record of monitoring of fossil fuels use for operational reason and its efficiency analysis


The company has made an increase the efficiency the use of fossil fuels and renewable energy optimizers. In 2014, POM-1 makes efficiency Rp. 1,177,126,440 where the total cost of the use of diesel (generator + tur-bine + biogas) is Rp. 40,148,900,505 and the total cost of the use of diesel (turbine + biogas) is Rp. 38,971,774,065.

The company also monitors the use of fuel ie diesel, shells and fiber in 2014. Total fresh fruit bunches pro-cessed in 2014 as much as 282,173,328 kg, total diesel fuel use as much as 106,380 liters, total use of shell as much as 19,758,886 kg, total fiber consumption as much as 45,163,167 kg so that total consumption of diesel / fresh fruit bunches processed is 0.00038 liters/kg of fresh fruit bunches and total use of shell + fiber / fresh fruit bunches processed is 0.23008 kg.

In 2015 (January to May 2015), POM-1 make efficiency Rp. 680,291,330 where the total cost of the use of diesel (generator + turbine + biogas) is Rp. 6,258,769,217 and the total cost of the use of diesel (turbines + biogas) is Rp. 5,578,477,887.

The company also monitors the use of fuel ie diesel, shells and fiber in 2015. Total fresh fruit bunches pro-cessed in 2015 (January to May) as much as 129,377,790 kg, total diesel fuel use as much as 85,560 liters, total use of shell as much as 9,017,919 kg, total of of fiber consumption as much as 20,612,386 kg so that the total consumption of diesel / fresh fruit bunches processed is 0.00066 liters / kg of fresh fruit bunches and to-tal use of shell + fiber / fresh fruit bunches though is 0.22902 kg. Auditor Conclusions : Closed

Criterion 6.1 (Indicator Major 1) : Documented enviro nmental and social impact assessment, including details of positive and negative social effects tha t may be caused by plantations and mills, and docu-mented participation of affected part ies and local communiti es

NCR P&C 2014-13 of 15

There is no evidence that social impact assessment of MS2 Mill has be participated by affected parties and lo-cal communities.


The auditee has provided draft of Social Impact Assesment report in MS 2 POM, the draft s evidence of partic-ipation from affected parties and local communities i.e worker in MS 2 POM, communities in Sebabi and Tanah Putih village and head of Telawang Sub District. In report has sighted about analyst of stakeholdfer, issues in MS 2 POM and monitoring and management plan.

In this re-certification audit found that MS has conducted social impact assessment for Mill 2 and develop the documents in 2014. The Social Impacts assessments have involving affected parties by two approach-es, meeting/discussion and data collections with questionnaires.

Social impacts management plan for 2014 – 2018 has developed as the part of SIA document. Records re-



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garding local community involvement in social impacts assessment process have been shown during audit, such as meeting attendant list and filled questionnaires (6 samples from 2 different villages consist of 14 questions)


Criterion 6.1 (Indicator Minor 1) : Regular monitorin g and management of social impact, with the partic-ipation of local communities

NCR P&C 2014-14 of 15 : Social impact montoring and management plan in MS2 Mill has not participatory/involved of affected communities


The Social Impacts assessments have involving affected parties by two approaches, meeting/discussion and data collections with questionnaires. Social impacts management plan for 2014 – 2018 has developed as the part of SIA document.

Records regarding local community involvement in social impacts assessment process have been shown dur-ing audit, such as meeting attendant list and filled questionnaires (6 samples from 2 different villages consist of 14 questions). Auditor Conclusions : Closed

Criterion 6.5 (Indicator Minor 1) : Growers and mill ers provide adequate housing, water supplies, medi-cal, educational, and other facilities for employee s where such facilities are not available or access ible

NCR P&C 2014-15 of 15 : Worker housing was found that there were insufficient infrastructure such as : some house was getting flood when it was rain as example : house no. G23, G24, G25, G38, G61, G61 at MS 2 mill’s housing. This damaged already reported to the officer, however there was no response and no action taken


Check into documents and records found that MS has built adequate housing facilities for worker, and provide adequate electricity and water. Complaint from housing residents regarding worker facilities is responded properly. Every local housing has an officer who responsible for maintenance management.

Field check and interview with worker’s spouse found that company routinely maintain the facilities keep in or-der. Sewerage surround house no. G23, G24, G25, G38, G61, G61 at MS 2 mill’s housing has been partly maintain and in a progressive maintenance progress. Company has create and develop budget for renovation program. Complaint regarding housing facilities would be handled aggregately Auditor Conclusions : Closed

• RSPO SCCS

E.1.1 Document procedures

NCR SCCS No. 2014-01 of 02

• The facility does not have SOP tolling mechanism,



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• The facility does not have update SOP which related FFB receive and delivery between mill and

• The facility does not have update sell administration procedure because it is not covering delivery order or contract must be product category and supply chain model information.

Verification result : The company has provided new procedure i.e “FFB tolling process (titip olah)” (MSPOM-LOG-015 dated on August 1, 2014). Inside the FFB tolling process procedure has explained i.e : • FFB certified on the “tolling process’ status was not recognized as FFB certified by POM, • Sales or dispatch or product as the RSPO certified product if it raw material are own property whereas the

raw material with the tolling status not allowed/permitted as RSPO certified product by POM and • If the mill is being broken, handling or manage of FFB in loading ramp i.e carry out transfer of FFB to other

mill and mill writing the name of FFB contributor on FFB delivery note.

The auditee has provided revision of sell administration procedure in MS 2 POM regarding delivery order or contract must be product category and supply chain model information.

Auditor Conclusions : Closed.

E.3.1 Record keeping

NCR SCCS No. 2014-02 of 02

• The mass balance report period of August 2013, there are not reduction for dispatch FFB to MS2 POM.

• The delivery order on behalf other party but on mass balance report for transaction it on behalf auditee, ex-ample : the product dispatch on period of May 2014 on behalf PT STP

Verification result : Closed The auditee has provide revision of mass balance report year 2013 where total volume of FFB has reduced for FFB dispatch from MS 1 POM to MS 2 POM.

The auditee has provide recapitulation of delivery order with tolling status period of October 2013 to June 2014 and revision of mass balance report period of October 2013 to June 2014 where has excluded tolling transac-tion from FFB receive to product dispatch.


3.3 Identified Non-conformances against RSPO P&C Require ments, Corrective Actions Taken and Auditors Conclusions

• RSPO P&C

Indicator 1.3.1 There shall be a written policy com mitting to a code of ethical conduct and integrity in all operations and transactions, which shall be doc umented and communicated to all levels of the workforce and operations


PT Mustika Sembuluh does not have a written policy that contains a commitment to the code of integrity and ethical conduct in all of operations implementation and transaction must be documented and communicated to all levels of employees and operations. Correction :

The company will create of the code of integrity and ethical conduct in all operations.

Corrective Action :

The company will carry out socialization of the code of integrity and ethical conduct to all employees and third parties. Auditor Conclusions : Evidence of immediate action t aken was accepted. Effectiveness of implementa-



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tion to verified at next surveillance audit

Indicator 2.1.1 Evidence of compliance with relevan t legal requirements shall be available


There are still several conditions not compliances with regulation where were found during surveillance audit as follows :



• No evidence that Bipartite Cooperation Institution (LKS Bipartit) at Mustika Sembuluh 2 mill has not been announced to local government so it was non-complaince with Ministry of Labour and Transmigration regulation No.PER.32/MEN/XII/2008 article 9.

• Hazardous and toxic containers have not been putted symbols which appropriate with type and clasifica-tion of hazardous and toxic product so it condition was non-compliance with Environmental Agency regula-tion no.3 year 2008.



Correction : • The company will provide of document about the change of forest areas process in region level because all

process change of forest areas and release of forest areas was carried out by head office. • The company will provide of the structure of organization of OSH committee in MS-2 mill was approved by

local government. • The company will provide of evidence that Bipartite Cooperation Institution (LKS Bipartit) at Mustika Sem-

buluh 2 mill has been announced to local government. • The company will put on symbol of hazardous and toxic product on each container, infront of hazardous and

toxic product warehouse, fosil fuel container, etc reference of Environmental Agency No.3 year 2008 article 2-3.

• The company will put on symbol of hazardous and toxic waste on each container and their keeping storage and type of symbol appropriate with Environmental Agency No.14 year 2013 article 2 and 7.

Corrective Action : • The company will follow up and monitoring of the change of forest areas process and Central Kalimantan

Project (CKP) management will submit email of letter to head office by periodically regarding update condi-tions and their documents,

• The company will follow up and monitoring approval of OSH committee and Bipartite Cooperation Institution (LKS Bipartit).

• The company will socialization of symbol of hazardous and toxic product appropriate Environmental Agency No.3 year 2008 article 2-3 to PiC of warehouse.

• The company will socialization of symbol of hazardous and toxic waste appropriate Environmental Agency No.14 year 2013 article 2 & 7 to PiC of warehouse.

Auditor Conclusions : Closed Date of closure : July 30, 2015 Verification results :



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The auditee has provided some evidences i.e :

• Letter no.063/MS/LCS/II/2014 dated on 3 February 2014 from PT Mustika Sembuluh to Governor of East Kalimantan Province regarding recommendation for replacement areas amount of 5,227 Ha at Long Bangun village, Long Bangun Sub District, Mahakam Hulu District, East Kalimantan Province. There has not been respond from governor relate it. Moreover, letter no.S.384/VII-KUH/4/2015 dated on 18 March 2015 from Ministry of Environmental and Forestry to Secretary of local government in East Kalimantan Province regarding respond from previous letter no.521/6673/Ek dated on 8 October 2014 regarding re-quest advice of change of forest areas process base on Minister of Forestry regulation no.P.41/Menhut-II/2012. Base on stages of forest areas process (Minister of Forestry regulation no.P.28/Menhut-II/2014 jo P.41/Menhut-II/2012 jo P.32/Menhut-II/2010) in the progress.

• Head of social, manpower and transmigration in Kotawaringin Timur District decree no.KEP.560.566/244/WAS-KK.P2K3/VIII/2015 dated on 28 July 2015 regarding approval of OSH commit-tee in MS2 mill.

• Head of social, manpower and transmigration in Kotawaringin Timur District decree no.KEP.560.566/976/KEP/HI-KESJA/VII/2015 dated on 23 July 2015 regarding approval/registration of Bi-partite Cooperation Institution (LKS Bipartit) in MS2 mill.

• More photographs about put on symbol of hazardous and toxic waste on containers and infront of hazard-ous of toxic warehouse in both mills and symbol of hazardous of toxic product on containers and infront of agrochemical warehouse in estate. Moreover, Minute of meeting about socialization of symbol of hazard-ous and toxic product and waste dated on 8 July 2015 and statement letter of put on symbol of hazardous and toxic product on product container and infront of agrochemical warehouses in estate and symbol of hazardous and toxic waste on waste container and rack and infront of hazardous and toxic waste ware-house in both mills.

Indicator 2.1.2 A documented system, which includes written information on legal requirements, shall be maintained


Inside the list of laws and regulations (law register) relate of plantation (form no.02/SOP 08/CKP/(2)/0111 rev.10 dated on 1 May 2015) that Ministry of Forestry regulation no.P.32/Menhut-II/2010 jo P.41/Menhut-II/2012 was not been evaluated or analysed by company so the company not understand what has complied or not Correction :

Fill in Ministry of Forestry regulation No.P.32/Menhut-II/2010 jo No.P.41/Menhut-II/2012 to laws and regula-tions

Corrective Action :

To ensure update of regulations and laws must be carried out regulary

Auditor Conclusions: Evidence of immediate action ta ken was accepted. Effectiveness of implementa-tion to verified at next surveillance audit

Indicator 2.1.3 A mechanism for ensuring compliance shall be implemented


The company also carries out evaluations of compliance to applicable local, national and ratified international laws but there is evidence that two of them regulation not appropriate with existing condition such as Environ-mental Agency regulation no.3 year 2008 and no.14 year 2013.



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Correction :

Revision of the evaluation of compliance with cross (X) sign from tick (√) sign for Environmental Agency reg-

ulation No.3 year 2008 and No.14 year 2013 because condition exicisting still not compliance.

Corrective Action : Evaluation of laws and regulations shall ensure that documentation and actual in field was compliance. Auditor Conclusions: Evidence of immediate action ta ken was accepted. Effectiveness of implementa-tion to verified at next surveillance audit

Indicator 4.1.1 Standard Operating Procedures (SOPs ) for estates and mills shall be documented


The related the consistency of SOP’s implementation, still it found some inconsistencies in the field, for ex-ample : 1. Accident investigation was not carried out by personil which has capability or responsibility for accident

dated on 4 May 2015 in MS2 POM so it condition not compliance with accident investigation procedure. 2. Impelementation of fertilizer doses not appropriate with circular letter dated on 26 January 2015 from Envi-

ronmental Management Unit (EMU) regarding standard of fertilizer doses with using fertilizer bowl kingoya, as follows : • Applied of MoP at block 090 (MS-1) with fertilizer doses is 1.75 kg/palm so using yellow bowl with fre-





4. Found difference between "Agriculture Manual and Standard Operating Procedure for Oil Palm in 2011," “Prosedur Standard Keselamatan Kerja Panen dan Pemangkasan Pelepah Kelapa Sawit (Harvesting & Pruning) (PSKK 01/CKP/(1)/1209, Rev 01, 1 Desember 2009)” and "Standard Operation Procedure Safe Palm Oil Mill (WIP / POM/SOP/01/02-14) that is regarding Minimum Ripeness Standard. In 1)."Agriculture Manual and Standard Operating Procedure for Oil Palm in 2011" stated that 5 loose fruit on the ground for less than 7 year old palms, and 2 (two) loose fruits on the ground for 7 years old and above palm, 2).“Prosedur Standard Keselamatan Kerja Panen dan Pemangkasan Pelepah Kelapa Sawit (Harvesting & Pruning) (PSKK 01/CKP/(1)/1209, Rev 01, 1 Desember 2009)” stated that 5 loose fruit on the ground, there’s no difference year of planting, and 3). the "Safe Standard Operation Procedure mills (WIP / POM / SOP / 01 / 02-14" is ≥ 10 loose fruit on the ground.

5. There was no evidence that the Estate conduct regular harvest inspection (weekly) related standards and quality of the harvest and reported to the EMU every Wednesday using the form QAMS Weekly Report, as required in the "Agriculture Manual and Standard Operating Procedure for Oil Palm in 2011".



8. Based on interview with PiC transit warehouse and field conductor (FC) in MS2 that spraying workers bring PPE to their home and fertilizer workers bring/keep PPE to PiC of transit warehouse’s home. It con-dition was appropriated with PPE procedure (PROS-SD-15-05) and OHS standard about washing work tools (PSKK14/CKP/(0)/0909).

9. MS-1 POM was not done responsed for incoming letter because log book of incoming letter not available



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too. The estate has responsed for incoming letter dated on 3 February 2014 from Pondok Damar village (letter no.89/PDM-MHU/Ur-Pem/ii/2014) more than 14 days. It condition not appropriate with procedure of providing information to outside parties/stakeholders (transparency)

Correction :

• The company will results of investigation accident by personil which responsibility or capability next period and records of investigation accident training.

• The company will provide of evidence that it was used bowl colour which appropriated with circular letter dated on 26 January 2015 from Environmental Management Unit (EMU).

• The company will revision of procedure relate of pruning implementation and issued of internal of memo-randum about new standard was not appropriated with SOP.

• The company will revision of procedures so the same of their information • The company will form a internal QAMS team, conducting training to internal QAMS team and implementa-

tion of internal QAMS. • The company will evaluation of harvesting interval, will increase of harvesting productivity and giving insen-

tif to harvest worker which doing before and after idul fitri day. • Maximize of steam from BPV vertical strelizer on 2.9 bar and continuous strelizer on 2.6 bar • Repairing location of PPE storage. • The company will submit evidence that it incoming letter has written on log book because it has responded

by lisan

Corrective Action : • The company will carry out accident investigation training to EHS officer or accident investigation officers

and head of OHS committee ensuring investigation accident will carry out by investigation officer (appropri-ate with accident investigation procedure).

• Supervisor/mandore ensuring that bowl colour has appropriated with type of fertilizer which would ap-

plied before start fertilizing.

• The company will evaluate of all procedures which as same content and will documented internal of

memorandum and their SOP. Futhermore, supervisor/mandore will inform to pruning workers about

songgo 1 or sonngo 2 accordance year planted in morning meeting.

• To ensure implementation of internal QAMS has appropriated with programme by estate manager. • Always to evaluation harvesting rotation by regularly and implementation of insentive by consistently. • Socialization of digester temperature appropriate procedure to enginee room, boiler and press operator and

to ensure mill capacity which stabil is minimum 90% from factory capacity. • PPE keeped in warehouse of PPE storage, supervisor will ensure that all PPE has keeped in PPE storage

after finish working and re-socialization to employees that PPE storage in home is dangerous. • The company will respond for all incoming letter max. 14 days and appointment of one personnel who re-

sponsible as controlling and monitoring for respond letter from sections relevant. Auditor Conclusions : Closed Date of closure : July 30, 2015 Verification results :

Auditee has provided some evidences as follows :

• Minute of meeting and attendlist about investigation accident training dated on 10 July 2015 in MS2 mill with main topics are mechanism of fill in information on notification form, mechanism of investigation acci-dent and SOP no.PROS-SD-18-01. Based on accident report period of August 2015 in MS2 mill that no accident so investigation accident report not available too.

• Minute of meeting about re-socialization of using fertilizer bowl kingoya and calibration of fertilizer doses if using fertilizer bowl kingoya to mandore of maintenance and fertilizer workers in MS estate dated on 9 July 2015 and 13 July 2015. Other of evidence are photograph/documentation, attendant list, list of colour bowl



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which used appropriate each type of fertilizer and each dosage, compare of calibration vs recheck and check list of work tools and PPE (one of information is the colour bowl which used by employees) who checked by mandore of manuring dated on 13 July 2015 in block 025, 30 July 2015 in block 463, 057 & 166, 25 July 2015 in block 512, and 28 July 2015 in block 681. Moreover, a photograph about hand over bowl before start working and bowl was used by fertilizer workers appropriate with type of fertilizer and their doses.

• Inter office memo no.066/EMU/VII/2015 dated on 30 July 2015 from Sr.EMU Manager to all estate manager and mill head in CKP. It has explaned justification from internal expert that songgo 2 (two subtending fronds immediately below the lowest fruit buch should be pruned) for young mature, short and harvest us-ing chisel (dodos) but if condition of old mature and harvest using sickle (egrek) be permitted songgo 1 (one subtending fronds immediately below the lowest fruit buch should be pruned) because bunch stealing difficult to implemented in field. Generally that the midrib of songgo 1 still in the spiral 6 so it condition has accorded with SOP & wilmar agriculture manual year 2011 in point 5.1 - table 6.2.5. It has socialized to harvest workers in MS1 estate (Division 1B), MS2 estate (Division 2A), and MS3 estate (Division 2A) dated on 1 August 2015 (evidence in the form of minute of meeting & attendant list).

• Inter office memo no.066/EMU/VII/2015 dated on 30 July 2015 from Sr.EMU Manager to all estate manager and mill head in CKP. It has explaned justification from internal expert that SOP & Wilmar agriculture manual year 2011 chapter 7 poin 6.2 regarding minimum ripeness standard are 5 loose fruit on the ground for less than 7 year old palms, and 2 (two) loose fruits on the ground for 7 years old and above palm where it has reffered by harvester. Whereas, the "Safe Standard Operation Procedure mills (WIP / POM / SOP / 01 / 02-14)" regarding minimum ripeness standard are ≥ 10 loose fruit on the ground (weight of fruit bunch > 5 kg) and > 5 looses fruit on the ground (weight of fruit bunch < 5 kg) where it has reffered by grading of-ficer in loading ramp. Minimum ripeness standard in SOP & Wilmar agriculture manual year 2011 chapter 7 poin 6.2 is on palm tree but in Safe Standard Operation Procedure mills (WIP / POM / SOP / 01 / 02-14) is on loading ramp so it not problem by technically because different location and condition. Whereas, Prosedur Standard Keselamatan Kerja Panen dan Pemangkasan Pelepah Kelapa Sawit (Harvesting & Pruning) (PSKK 01/CKP/(1)/1209, Rev 01, 1 Desember 2009) has revised per 27 July 2015 (no.PSKK 01/CKP/(2)/0815 rev.02) that sentence of minimum ripeness standard has deleted. All information above has socialized to harvest workers dated on 1 August 2015.

• QAMS (Quantitative Agro Management System) census internal programme year 2015 (August to Decem-ber 2015) in MS estate (MS1 to MS3 estate) and QAMS census weekly report period of August to Septem-ber 2015 in MS1 estate (block 110, 054, 097, 004, 068 and 012), period of 7-10 September 2015 in MS2 estate (block 026, 121 and 075) and period of August 2015 in MS3 estate (024, 107 and 179). MS estate has carried out QAMS census training dated on 28 July 2015 to QAMS census officer (9 personils such as field conductor and mandore RSPO from MS1 estate, maintenance officer from MS1-3 estate, mandore maintenance from MS2-3 estate and field conductor of smallholder from MS2 estate) with main agendas are know about definition of QAMS census, looses from extraction rate and volume of product because losses FFB was not picked up, mechanism of QAMS census and tools and materials in QAMS census.

• Statement letter of the evaluation of harvesting interval dated on 6 July 2015 from MS2 & MS3 estate that MS2 & MS3 estate has conducted evaluation of harvesting internal period of 1-5 July 2015 with the result of evaluation are more blocks have harvesting internal not appropriate with SOP for oil palm 2011 because density of FFB with ripe category still high and the workers has Eid al fitr’s leave. Based on condition it that so MS2 estate issuing a policy are the increase of harvester productivity with adding output of harvesters and giving incentive of harvest activities which working before and after eid al-fitr day. Realization of policy is inter office memo no.004/GM-CKP/VI/2015 dated on 20 June 2015 from General Manager to all manager regarding incentive of harvest activities in eid fitr’s day year 2015 where 1).incentive will be given to har-vester, mandore of harvest, supervisor of checker, supervisor of transport and operator/tractor driver/truck and loader, 2).value of harvest incentive is 1 (one) times the district minimum wage, 3).workersbe shall be working 12 days without pause (not carried out annual leave, sick leave except accident, permt of outside dependents by the company and permit with dependemts by the company except emergency. Moreover, there are harvesting interval plan in MS2 & MS3 estate period of July 2015 where their harvesting interval are ≤ 10 days for 23 blocks (3,842.39 ha) and 11-15 days for 2 blocks (28.93 ha).

• MS2 mill has carried out socialization of SOP about BPV, CST and digester dated on30 July 2015 with evi-dence in the form of minute of meeting, photograph and attendant list. MS1 mill has carried out socializa-tion of digester operation appropriate SOP to operator of press stasion, enginee room station and boiler station include of calculate of converting temperature from fahrenheit to celcius. The evidence in the form of minute of meeting, photograph and attendant list. Moreover, the both mills have submitted photographs about actual of temperature in CST area and digester 1-4 area has accorded with SOP (95 ± 50C) after im-



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provement action.

• Minute of meeting regarding the socialization of hazardous when PPE kept at home dated on 24 July 2015 in MS2 estate, photograph and attendant list. Moreover, the MS2 estate has submitted the photograph of actual condition per 27 July 2015 from transit warehouse for PPE storage in emplasment N. It has de-scripted that warehouse has repaired and all PPE has kept in warehouse include apron and knapsack.

• MS estate has submitted a statement letter about the company will comitment to respond incoming letter not more than 14 days so they was submitted evidence of the incoming letter from Edi Santoso dated Jan-uary 30, 2015, concerning a request for compensation with the letter number 01 / SP / 30-2015 and letters in response to a letter entered Edi Santoso dated February 6, 2015 with the letter number 06 / BM-MS / II / 2015. Whereas, MS1 POM fill in a incoming letter to log book of incoming letter as evidence that the com-pany has recorded outgoing letter as a response to the incoming letter

Indicator 4.4.2 Protection of water courses and we tlands, including maintaining and restoring appro-priate riparian and other buffer zones (refer to na tional best practice and national guidelines) shall be demonstrated


The company does not have sufficient evidence that they has not carried out fertilizer and spraying activities on riparian areas because the volume of fertilizer records (NPK) period of February 2015 at block 061 (Division 1 – MS 2 estate) and block 512 (MS 3 estate) that company has applied for all palms inside block it whereas there are riparian areas within the blocks. Moreover the request of chemical for circle and path spraying at block 794 (MS-3 estate) still total of areas whereas there are riparian areas within the blocks.

Correction :

• The company will sensus of palm on riparian areas

• The company will decrease request of fertilizer in manuring programme

• District Manager will ensure MRIS was issued not include of fertilizer on riparian areas

• Re-socialization of fertilizer procedure to field conductor, mandore/supervisor, warehouse officer and

fertilizer workers.

Corrective Action :

District manager will checking MRIS and actual of fertilizer report. Auditor Conclusions : Closed Date of closure : July 30, 2015 Verification results :

The auditee has provided some evidences as follows :

• Statement of manuring activity at block 512 - Sub Division 2B (MS3 estate) dated on 25 July 2015 that volume of fertilizers has deducted from budget (budget is 6,266 kg for 3,581 palms and actual is 6,220 kg for 3,554 palms) because there are 27 palms on riparian belt areas (before is 28.64 ha and after is 28.20 ha) moreover there are total of palm on riparian belt areas each division. Note of re-socialization regard-ing manuring activities in riparian belt areas to manuring workers at Sub Division 2B (MS3 estate), photo-graph and attendant list was available. Material requisition & issue slip (MRIS) no.066023 dated on 25 Ju-ly 2015 for MOP product amount of 6,220 kg with doses is 1.75 kg/palm in sub division 2B – MS3 estate.

• Division 3 - MS1 estate (block 105-112, 126-131, 140-142, 144, 145) has inventoried palms on riparian areas per July 2015 amount of 908 palms (block 112 is 40 palms). Volume of fetilizers has deducted from budget as example request of MOP at block 112 (Division 3B) where budget is 11,521 kg (7,681 palms) and actual 11,450 kg (7,641 palms) based on MRIS No.12374 dated on 6 July 2015 with doses is 1.50 kg/palm and 58.81 Ha.

• MS2 estate has inventoried palms on riparian areas per July 2015 amount of 7,011 palms (block 061 is 53 palms). Volume of fertilizers has deducted from budget as example request of kiesrite at block 061 (Divi-



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sion 1A) where budget is 3,090 kg (4,120 palms) and actual 3,050 kg (4,067 palms) based on MIRS dated 29 July 2015 with doses is 0.75 kg/palm and 31.55 Ha. Note of re-socialization, photograph and attendant list about riparian belt dated on 27 July 2015 in MS-2 estate (Sub Divisi 1A) with main topics are prohibit of spraying and fertilizing in riparian areas and procedure of riparian management (SOP20/HCV/(1)/0115.

• Based on total of palm on riparian belt areas each division in MS3 estate that all palms was not available on riparian belt areas at sub division 1C except block 385 thus the request of agrochemical in block 794 total of areas or palms (41.19 ha and 4,842 palms).

Indicator 4.7.1 A health and safety policy shall be in place. A health and safety plan covering all acti vi-ties shall be documented and implemented, and its e ffectiveness monitored

NCR No.2015-07 of 18 (indicator 4.7.1 as Major non-conf ormity) The company (estates and mills) have not OHS programme/plan year 2015

Correction :

Create of OSH programme which it has integrated between estates and mills

Corrective Action :

• OSH programme was available

• Create of realization and evaluation of OSH programme report

Auditor Conclusions : Closed Date of closure : July 30, 2015 Verification results :

The company has provided evidence of annual OSH programme year 2015 with header of programme are celebration of OSH anniversary, OSH campaign and prevention of occupational diseases programme. Each type of programme has inform of requency and timeline plan where type of programme has realized are instal-lation of spanduk/signboard/pamphlet of OSH in entry gate, infront of office and emplasment, socialization and simulation of prepadeness emergency response, annual medical check up and their evaluation. The rest will be held on August and December. Indicator 4.7.2 All operations where health and saf ety is an issue shall be risk assessed, and proce-dures and actions shall be documented and implement ed to address the identified issues. All precau-tions attached to products shall be properly observ ed and applied to the workers


• Third party workers and MS-1 mill worker smoking in mill areas where there is sign of prohibit smoking near them smoke

• MS-2 mill have not risk assessment Correction :

• The company will issue punishment letters and re-socialization to employees and contractors.

• MS2 mill will carry out risk assessment

Corrective Action : Re-socialization of prohibit of smoking in mill areas to employees and contractors and implementation of

punishment. Auditor Conclusions : Closed Date of closure : July 30, 2015



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The company has provided evidence of warning letter no.01/MSPOM1/ADM/07/2015 dated on 7 July 2015 from MS1 POM to UD Berkat Sembuluh regarding employees from UD Berkat Sembuluh smoking in mill areas so to the attention and not reoccur because UD Berkat Sembuluh will be black list as contractor if it reoccur again. There is punishment letter no.06/PGA-MSPOM1/SPS/VII/2015 dated on 7 July 2015 on behalf empty bunch press operator (employee ID : 722MS08068212) and evidence of fault record dated on 15 June 2015 on behalf maintenance officer at workshop because they are smoking in working areas. Maintenance officer pay pinalties amount of Rp 20,000 and create of statement letter no.001/MSPOM1/EHS-SP/VI/2015 dated on 15 June 2015 that he will not repeat violation again on next time. MS1 POM has carried out re-sozialitation of prohibit of smoking in working areas dated on 8 July 2015 as preventive action so the company hope similar fault not reoccur in the next time. Attendent list, photograph and note of training as evidence that it has car-ried out re-socialization was available.

MS-2 mill has created risk assessment and their results in the form of aspect impact of environmental & OSH period 2015-2016 every activities/sections/stations in mill such as security, weighbridge, office, sortation, load-ing ramp, sterilizer, thresser, clarification, press, kernel, boiler, enginee room, water treatment plant (WTP), maintenance/workshop, electricity, laboratory, POME pond, land application, dispatch CPO & PK, sounding, store/warehouse, and housing. Results of impact/risk analyst every impact/risk is high priority so impact/risk control programme/plan (“correction program for OSH and environmental”) was available.

Indicator 4.7.3 All workers involved in the operati on shall be adequately trained in safe working prac -tices (see Criterion 4.8). Adequate and appropriate p rotective equipment shall be available to all work-ers at the place of work to cover all potentially h azardous operations, such as pesticide application, machine operations, and land preparation, harvestin g and, if it is used, burning


• There are 2 harvest workers in MS-3 estate not using PPE except boots (they are has worked during 10-11 months) and cover harvesting tools (knife sickle (egrek) and “dodos”) not available too.

• There are harvest workers and supervisor of fertilizer activity at block 090 (MS-1 estate), harvest workers at block 039 (MS-2 estate) and pruning workers at block 913 (smallholder in MS-2 estate) not using PPE.

Correction :

• The company will provide of evidence that PPE used by workers on working areas

• The company will give sanction to mandore/supervisor/field conductor who does not supervise the com-

pleteness or the use of PPE.

Corrective Action :

Mandore/supervisor/field conductor will does supervise use of PPE before and working. Auditor Conclusions : Closed Date of closure : July 30, 2015 Verification results :

The auditee has provided evidence of decision letter about punishment no.227/HRD-MS2/SPS/VII/2015 dated on 7 July 2015 to mandore of harvesting in MS3 estate, no.262/HRD-MS2/ST/VII/2015 dated on 7 July 2015 to mandore of maintenance in MS2 estate, no.124/HRD-MS/SPS/H/VII/2015 dated on 6 July 2015 to harvester in MS1 estate and no.103/HRD-MS/SPS/H/VII/2015 dated on 6 July 2015 to mandore of harvester in MS1 es-tate because they are not use of PPE and mandore did not supervise the use of PPE by employees.

The company has provided evidence of PPE distribution to employees include of cover harvesting tools (knife sickle (egrek) and “dodos”). Inside list of PPE distribution that all employees who not use of PPE has received PPE from company.



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Indicator 4.7.4 The responsible person/persons sha ll be identified. There shall be records of regular meetings between the responsible person/s and worke rs. Concerns of all parties about health, safety and welfare shall be discussed at these meetings, a nd any issues raised shall be recorded


• OHS committee meeting was not discussed for health issues in MS-2 mill

• No evidence that Bipartite cooperation institution (LKS Bipartit) has carried out regulary meeting in MS-2 mill so welfare issues was not discussed

Correction :

• OSH committee meeting in MS2 mill will discusse for health issues

• Bipartite cooperation institution (LKS Bipartit) in MS2 mill will does meeting

Corrective Action : The management will ensure that OSH meeting and Bipartite cooperation institution (LKS Bipartit) was done and these topics are health and welfare issues. Auditor Conclusions : Closed Date of closure : July 30, 2015 Verification results :

The company has provided evidence of OSH committee meeting dated 22 june 2015 in MS2 mill in the form of minute of meeting, attendant list and photograph. OSH committee meeting has discussed health issues ex-ample evaluation of the results of annual medical check up.

The company has provide evidence of Bipartite cooperation institution (LKS Bipartit) meeting in MS2 mill too. Bipartite cooperation institution (LKS Bipartit) meeting dated on 7 January 2015 has discussed about Gover-nor of Central Kalimantan regulation No.43 year 2014 and national health care security (BPJS Kesehatan) year 2015, meeting dated on 3 February 2015 has discussed about workers social security agency (BPJS Ketenagakerjaan), and meeting dated on 10 April 2015 has discussed about condition of emplasment and their environmental condition.

Indicator 4.7.5 Accident and emergency procedures s hall exist and instructions shall be clearly un-derstood by all workers. Accident procedures shall b e available in the appropriate language of the workforce. Assigned operatives trained in First Aid s hould be present in both field and other opera-tions, and first aid equipment shall be available a t worksites. Records of all accidents shall be kept and periodically reviewed


• The records of accident in MS-2 mill not available with complate such as board of accident statistic, acci-dent report every month, etc.

• The company (estates and mills) was not carried out review of accident by regularly • Record from one of accident investigation in MS-3 estate not available.

Correction : • The company will provide of accident report in the form of board of accident, statistic of accident and infor-

mation of accident every month • To review every 6 months for all accidents in estates and mills • Carry out accident investigation for one of accident in MS3 estate

Corrective Action :

To ensure all accident records and documents was available appropriate with procedures by OSH officer.



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Auditor Conclusions : Evidence of immediate action t aken was accepted. Effectiveness of implemen-tation to verified at next surveillance audit

Indicator 4.7.7 Occupational injuries shall be rec orded using Lost Time Accident (LTA) metrics

NCR No.2015-12 of 18 (indicator 4.7.7 as Minor non-conf ormity) Information of LTA/LTR not available in MS-2 mill because accident records not available. Correction :

The company will provide of accident report where it was included LTA/LTR information

Corrective Action : To ensure all accident records and documents was available appropriate with procedures by OSH officer. Auditor Conclusions : Evidence of immediate action t aken was accepted. Effectiveness of implementa-tion to verified at next surveillance audit

Indicator 6.4.1 A procedure for identifying legal, customary or user rights, and a procedure for ident i-fying people entitled to compensation, shall be in place.



mentioned in this three procedures. Company has not yet showed specific evidences regarding how to con-duct identification and verification for legal and custamary land that considered the Governor Regulation 13/2009. This regulation empahsize the importance roles of Dayak Custamary Board (Dewan Adat Dayak) as the official body appointed by the governor.

- The officer responsible to open communication and negotiations with related stakeholder regarding land dispute has no enough authority to make decisions (as one of stakeholder consultation issues)

Correction : • Provide evidences regarding participations of Dayak Customary Board Member (Damang) in order to con-

firm that there is no customary land inside PT MS HGU. • Authorize officers to communication and consultation officer for conduct negotiations relate of compensa-

tion

Corrective Action : • Provide information to communities that there is no customary land inside HGU by involving Damang in the

process. • Appointment letter from top management regarding authorization of officers in order to conduct communica-

tion and consultation officer for conduct negotiation ralate of compensation Auditor Conclusions : Closed Date of closure : July 30, 2015 Verification results : Company has provided evidence showing that a member of Custamary Land Body (Damang) appointed by Governor has confirmed that there is no customary land inside Company’s HGU. The active Damang is Has-bullah AT, born in Kotawaring Timur, July 04th 1971. As the damang of Mentaya Ilir Sub District of Kotawar-ingin Timur District, stated that all of land acquisition process in PT MS HGU area since 2001 to 2015, per-



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sonally and/or grouply, has been conducted trough a mechanism of SKT (Surat Keterangan Tanah – land identity letter) submission.He also stated that land acquisitions in PT MS has not conducted in local customary mechanism.

Indicator 6.5.2 Labour laws, union agreements or direct contracts of employment detailing payments and conditions

of employment (e.g. working hours, deductions, overtime, sickness, holiday entitlement, maternity leave, reasons for

dismissal, period of notice, etc.) shall be available in the languages understood by the workers or explained carefully

to them by a management official.


Based on document “Mature Field Operation, Contract and labor Rate 2014 and 2015”, Company doesn’t ap-ply any piece rate differentiations between regular day and holiday. This norm is not complying with national regulations regarding overtime payments. Checking into harvester workers diaries found that some of them have work in Sunday (holiday) but paid in the same rate as they work in regular day.

Correction :

Company has not yet formulate peace rate payment system that considering differentiation of wage val-

ue between regular day and Sunday/holiday.

Corrective Action : Company will formulate and issued a policy regarding wage payment system for piece rate worker that con-

sidering the differentiation between regular and Sunday/holiday. Auditor Conclusions : Closed Date of closure : July 30, 2015 Verification results : Company has issued an internal memo regarding piecerate incentive for Sunday/Holiday. This memo stated that worker who work in Sunday/holiday will accept incentives, as follow: a. If the piece rate equal and/or over to UMK (daily), then the worker will accept incentive equal to UMK. b. If the piece rate under UMK value, then the incentive value would be twice of normal day piece rate.

Indicator 6.5.3 Growers and millers shall provide adequate housing, water supplies, medical, educational and welfare

amenities to national standards or above, where no such public facilities are available or accessible

NCR No.2015-15 of 18 (Indicator 6.5.3 as Minor non-conf ormity) Field Check on MS3 emplacement, Bedeng C found that worker’s house is leak and not yet repaired event has been reported three times. Correction :

The company will conduct repair of Bedeng C

Corrective Action :

• To ensure all compliances from employees will follow up with quick of respond

• The company will conduct monitoring of emplasment condition regularly

• Implementation of emplasment repair programme Auditor Conclusions : Evidence of immediate action t aken was accepted. Effectiveness of implementa-tion to verified at next surveillance audit



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Indicator 6.10.4 Agreed payments shall be made in a timely manner

NCR No.2015-16 of 18 (Indicator 6.10.4 as Minor non-con fprmity) During interview process, supplier showed evidence that company has made late payments for the last three months Correction : The company will pay with immediately to FFB suppliers if all document was completed Corrective Action :

• Top management will monitor of payment progress to FFB suppliers appropriate with agreement letter

• Re-inform to all supliers about regulation of payment include of all required documents. Auditor Conclusions : Evidence of immediate action t aken was accepted. Effectiveness of implementa-tion to verified at next surveillance audit

• RSPO SCCS

E.2. Explanation

NCR No.2015-17 of 18 All transactions of certified PK sold starting April 2015 was not available in e-Trace

Correction :

• The company will input all PK transaction with certified status in eTrace platform after 1 April 2015

• Appoint PiC for imput all PK transaction with certified status in eTrace platform

Corrective Action : To monitor every PK transaction with certified status in eTrace platform


Date of closure : July 30, 2015

Verification result : The company has provided revision of mass balance report where all PK dispatch period of April to recer-tifcation audit as certified product convert to non-certified product and inform to buyer that all PK transaction previously not as certified transaction.

The company has provided evidence of shipping announcement with seller is PT Mustika Sembuluh and buyer is PT Wilmar Nabati Indonesia – Sampit for PK product amount of 1,463.65 mt, 1,074.38 mt, and 1,149.98 mt.

E.5. Record keeping

NCR No.2015-18 of 18

MS-2 mill was received FFB from Wilmar’s group estate with tolling status but handling of information in mass balance report year 2014 and 2015 not appropriate/compliance with FFB tolling process (titip olah) (MSPOM-LOG-015).

Correction : The revision of mass balance report MS2 POM period of June 2014 to June 2015 regarding reduction of the



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volume of FFB receipt, production and stock product because MS2 POM receive FFB from Wilmar’s group estate with tolling status.

Corrective Action : Top management will monitor of transaction with tolling status and information of FFB receipt with tolling sta-tus not include in mass balance report


Date of closure : July 30, 2015

Verification result : The auditee has provide revision of mass balance report year 2014 and 2015 where total volume of FFB has reduced for FFB receipt from Wilmar’s group estate as tolling status.

The auditee has provide recapitulation of delivery order with tolling status period of June 2014 to June 2015 and revision of mass balance report period of year 2014 and 2015 where has excluded tolling transaction from FFB receive to product dispatch.

3.4 Conclusion and Recommendation for RSPO P & C and Sup ply Chain Certification

The audit team has confirmed through the audit process that PT Mustika Sembuluh has established and main-tains an effective system to ensure compliance with the RSPO P & C and Supply Chain Certification System re-quirements (dated November 2011). It is also confirmed that the company’s annual volume of CPO and PK sold for the period of 2014 has not exceeded the certified annual tonnages as claimed in the organization’s RSPO certificate.

TUV Rheinland recommends renewal of the certification of PT Mustika Sembuluh Palm Oil Mills 1 & 2 Mill , Oil Palm Plantation estate Mustika Sembuluh 1, 2 & 3 and smallholder (cooperative of Bita Maju Bersama) in ac-cordance to the RSPO P & C and Supply Chain Certification System requirements

3.5 Issues Raised by Stakeholders and Findings Perta ining to Issues

A) Issues raised during stakeholder consulting meeting

No. Stakeholders Issue Raised Management Response Audit Verification 1. Pondok Damar

communities

Local goverment road issue

Year 2004, local government has

developed road with width road 12 m

and there are trench on right-left road.

This road function to connect between

Pondok Damar village with Tabiku village.

Existing condition that it road not

available because could not used again.

The communittee has consulted with

company regarding restore the road

condition to its original/beginning

condition. Head of village very difficult to

meet with top management in PT

Mustika Sembuluh so it has not been

completed. Year 2008 that the company

has felling palms on areas it.

The communities hope that it road could

reopened so the accesses from Pondok

Damar village to Tabiku village could

used again.

The company has been promised to the

previous head of village regarding to

open road alternative i.e road in boundry

• The results of survey by GIS

team on January 2009 that

spesification of road is

width : 12 m and length :

6.37 km.

• Year 2009 that the

company has felling palms

on areas it amount of 774

palms

• There are no maintenance

of road it by local

government so current

condition that road

overgrown bushes again.

• If next time that local

government have road

incrase/maintenance

programme so the

company will support the

government’s

plan/programme.

Field check found that

the road still exist but

has cover by grass and

wild vegetation.

Sewereage lines still

existing but has also

covered by wild

vegetations. There is no

bridge over the river

that connect Pondok

Damar to PT MS HGU

areas trough this road.

Intervie result with local

villagers, as he can

remember, there were

no bridge there.



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No. Stakeholders Issue Raised Management Response Audit Verification of PT Mustika Sembuluh areas with PT

SKD areas but it has not been realized.

2 Head of

Mentaya Hilir

Utara Sub

District

1. The Local government road to be

restorred to the original/beginning

condition because it demands from

Pondok Damar and Tabiku

communities.

2. Head of sub district very difficult to

meet with top management in PT

Mustika Sembuluh

3. Land dispute resolution has not

been finished between head of sub

district (personal) with company

where it location near Sunagi Bahan.

Exicting condition, the area has been

planted by the company.

• This question has explained

above

• Wilmar has given the

responsibility as

representive of company in

communication with

stakeholders to Mr Juatku

Antono and Mr Andi Ayub

especially for

communication relate of

legal and land issues. They

are top management in

managerial level too.

• Land dispute with Head of

sub district in year 2012.

Whereas, there are

statement letter from

village team year 2004 that

land acquisition of villagers

in Pondok Damar village

has fully completed

Company applied

beurocrative

communication process

with stakeholder.

Officers and land

manager taking part and

authorized as official

company representative

has appointed.

3 Head of Tanah

Putih village

1. The road of 20.2 km has developed

year 1997 where it connecting

between Tanah Putih village with

Muara Bangkal. Current condition

that it has been planted by the

company so there is not road with

condition as before. There is a field

trip on 25 November 2014 between

company, representative of

communities and public work

instation with the results of field trip

is road manage by company but

current condition, progress of road

manage not available. The

communitties demands to be

restorred to the original/beginning

condition.

2. Rinjau river has been closed so it can

not accessed by communitties again.

3. There are oil palm planted on

outside land use right (HGU) PT MS

amount of 808 ha (location of Tanah

Putih and Sebabi village). Current

condition, it has taken over by one

of community for these FFB. The

communities demands clarity of the

status for areas it where there are

field trip on 10 December 2014

between company, local

government and communitties with

the purpose of checking the field

1. The company has carried

out road maintenance

inside MS3 estate length

7 km. The company has

carried out road

maintenance by routinely

which outside MS3 estate

length 9 km to Tanah

Putih village. Moreover,

the company has install

culvert plan/programme

at two locations.

2. Current condition for road

which not included in

MS3 estate not

maintained because since

year 2005 there is not

treatment by local

government so many

hard wood trees has grow

on the road. It is not the

company’s responsibility

to maintain the road.

3. MS3 estate does not

make changes to the flow

of the river and there is

not operational activities

in the river. Year 2009,

the company have plan

about the washing Rinjau

river but did not get

permission from

landowner (Mr Aner) near

the river for entry the

machine/heavy

equipment. The

condition of Rinjau

riparian is swampy and

wet so heavy equipment

can not get into riparian

1. Field checked

conducting during

recertification audit

and found that the

road still exist and

not planted. Some

area has been

covered by grass

and wild

vegetations and

some other has

been planted by

local villagers.

Company has begin

road revitalization

by mobilizing heavy

equipment to fix

the road in

participations of

local village as

supervisor.

Interview result

with him found

that he exclaim the

road revitalization

process will go

smooth if local

people

participated.

2. Based on interview

with one of

community which stay

in enclave areas (inside

MS3 estate) that Rnjau

river has been closed

with woods on last

time visit (before she is

pregnant). Access is

used when searching



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RSPO v1 2011-05-26

No. Stakeholders Issue Raised Management Response Audit Verification areas.

4. For clarity that the

company has hand over

to local government in

Kotawaringin Timur

District and proposed to

be used as scheme

smallholder for Tanah

Putih village and Sebabi

village but it has been

processed by local

government.

fish but it is not used

again now because the

need for fish is done by

buying. Auditor can

not verified to field

because informan it

being pregnant and

head of tanah putih

village was a duty so

he was appointed a

person as their

representative but he

is not understand

about location it.

3. The planted palm

oil outside HGU has

abandoned by the

company. There

was no harvesting

and maintenance

actvity conducted

by company over

that land.

4 Community In enclave areas was instaled sign board

of HCV areas but the communities as

own areas, prohibited doing activities

inside areas it.

There are communities areas

inside land use right (HGU)

company areas which has

installed HCV and enclave

signboard.

The results of HCV

assessment/identification by

third party that it areas as

HCV 5.

There are socialization of HCV

and MoU of safeguard HCV

before installing signboard of

HCV in areas it. The company

clarification that there are not

restrictions of activities on

signboard of HCV 5. On

enclave signboard, there are

restriction to operational

workers that they was

prohibited to activity inside

areas without the permission

of the land owner.

Next time, re-socialization of

HCV areas to communitties

will explain purposes and

objectives of signboard

installation of HCV5 which had

been installed.

1. In HCV 5 areas has

installed signboard of

HCV 5 and enclave. In

HCV 5 and enclave

signboard not sentence

that land owner was

prohibited activities.

2. There are MoU between

company with

communitties regardign

safeguard of HCV areas

but there are contents

relate of restriction of

land owner in HCV 5

areas.

3. Results of verification in

field (one of HCV 5

areas) that there are

activities by the land

owner in the form of

planting cassava, rubber

and oil palm.

5 Communitiy of

Bangkal village

1. The communitties request to

company for priority to communities

from villages which near company

when hirring employees because

more villagers are unemployed.

2. The communitties request to

company regarding socialization of

tranparancy

1. Whenever there is re-

cruitment as

staff/permanent daily

worker then HRD has pri-

oritized local labour from

communities around the

company but the skill and

experience adapted to

their qualification. The

company has submitted

list of employees from

Bangkal village and the

1. Base on master data

payroll report per June

2015 that there are 27

employees as staff and

61 employees as non

staff in PT Mustika

Sembuluh come from

Bangkalan village.

2. Base on letter

no.215/HRD-

RO/VI/2012 dated on 1

June 2012 from PT Mus-



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No. Stakeholders Issue Raised Management Response Audit Verification announcement of the test

participants to head of

Bangkal village (attach-

ment).

2. The communities have

carried out socialization of

transparency since year

2009. Next time, the

company will carry out so-

cialization of transparency

to communities again.

3. Perusahaan telah

melaksanakan sosialisasi

transparansi sejak tahun

2009. Akan direncanakan

memberikan sosialisasi

transparansi kepada

masyarakat.

tika Sembuluh to Head

of Bangkal village re-

garding announcement

of test participant that

the company has prior-

ited employees around

company.

3. Base on letter

no.362/Adm &

PR/III/2009 dated on 16

march 2009 from PT

Mustika Sembuluh to

stakeholders (local gov-

ernment, NGO and all

contractors) that the

company has shar-

ing/submitted infor-

mation of all documents

can access by public. All

stakeholders has re-

ceived letter it.

6 Environmental

Agency

1. MS-1 POM renew land application

permit process and MS-2 POM

between assessment stage to

utilization stage for land application

permit.

2. Year 2014 that the company has got

result of PROPER is red category

because collecting company for

harzardous and toxic waste have not

permit.

1. MS1 POM has submitted

letter regarding renewal of

land application permit.

MS2 POM has submitted

evidence of corrective ac-

tion for result of verification

in field.

2. The result of PROPER is red

category because the com-

pany has not been submit-

ted quality of liquid waste

report to environmental

agency period of October-

November 2013 in indicator

pond and anaerobic pond

so it is not because man-

agement of hazardous and

toxic waste.

1. MS1 POM has submit-

ted letter regarding re-

newal of land applica-

tion permit. MS2 POM

has submitted evidence

of corrective action for

result of verification in

field.

2. The company has sub-

mitted results of quality

of liquid waste period of

2nd

semester year 2014

7 Manpower

and social

Instantion

Data of local contractor has not been

availabled by Manpower Agency

The company will submit list

of local contractor

immediately to Manpower

and social Instantion in

Kotawaringin Timur District.

List of local contractor in PT

Mustika Sembuluh year

2014 and 2015 was

available. Type of working

by local contractor are

develop of emplasment

type G-10, repair of roof in

emplasment E, FFB

transportation, EFB

transportation, and

develop of permanent

trench.

8 Head of sub

district

commands in

Kota Besi

1. Coordination between the company

with sub district commands is well.

2. Drugs and FFB theft issues that sub

district commands hoping

communication tools in security

offices can increase so if any cases

that it can inform to sub district

commands immediately.

The company will increase

communication between

security team in company

areas and if any cases that the

company will inform to sub

district commands

immediately.

Evidence of communication

between security team in

company areas with sub

district commands was

available and complate.

9 Contractor Payment can be pay by company

appropriate with time line in

The company usually

monitoring of realization of

List of monthly payement

to third party per July 2015



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RSPO v1 2011-05-26

No. Stakeholders Issue Raised Management Response Audit Verification agreement/contract.

payment to third party by

SAP. If any late because there

are document has not been

complated and

discommunication.

that all bill from third party

has paid by company.

B) Issues Raised during Stakeholder Interviews On-site

No issue raised during stakeholder interview on site

4.0 CERTIFIED ORGANISATION’S ACKNOWLEDGEMENT OF INT ERNAL RESPONSIBILITY 4.1 Date of Next Surveillance Visit

The next surveillance audit is planned for June 2016

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

It is acknowledged that the assessment visit was carried out as described in this report and we accept the as-sessment findings and report content. Signed on behalf of PT Mustika Sembuluh

Simon Siburat Group Sustainability Coordinator Date : September 30, 2015

Signed on behalf of TUV Rheinland Indonesia Hendra Fachrurozy Lead Auditor Date : September 30, 2015



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APPENDICES

Appendix 1: Details of certificate



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

(Social & Environmental Impacts Assessment) Bapedalda Badan Pengendalian Dampak Lingkungan Daerah (Regional Body for Management

of Environmental Impacts) BLH BKPM BPN

Badan Lingkungan Hidup (Local Environmental Board) Badan Koordinasi Penanaman Modal (National Investment Coordination Agency) Badan Pertanahan Nasional(National Land Agency)

CD Community Development CKP CPO

Central Kalimantan Project Crude Palm Oil

DELH Dokumen Evaluasi Lingkungan Hidup (Environmental Evaluation document) DISNAKER DPLH

Dinas Tenaga Kerja (Manpower Officer) Dokumen Pengelolaan Lingkungan Hidup (Environmental Management Document)

DPRD Dewan Perwakilan Rakyat Daerah (Regional Parliament) EIA Environmental Impact Assessment EHS Environmental, Health & Safety EMU EFB ERTs

Environemtal Management Unit Endangered, Rare & Threatened species Empty Fruit Bunches

ESH Environmental Safety & Health FFB Fresh Fruit Bunches FIFO First in First out HCV High Conservation Value IPM Integrated Pest Management LTA Lost Time Accident MOU Memorandum of Understanding MSDS Material Safety Data Sheets MS NGO

Mustika Sembuluh Non-Government Organization

OSH Occupational Safety & Health P&C Principls & Criteria PKO Palm Kernel Oil POME Palm Oil Mill Effluent PP Peraturan Pemerintah (Government Regulation) PPE Personal Protective Equipment PT STP PT Sarana Titian Persada RKL Rencana Pengelolaan Lingkungan (Environmental Management Plan) RPL Rencana Pemantauan Lingkungan (Environmental Monitoring Plan) SCCS Supply Chain Certification System SPKT Surat Pernyataan Keterangan Tanah (land statement letter) SIA Social Impact Assessment SOP Standard Operating Procedure STNK TOR UKL

Surat Tanda Nomor Kendaraan (Vechicle Numbering Letter/License) Term of Reference Upaya Pengelolaan Lingkungan (Environmental Management Efforts)

UMSK Upah Minimum Sektoral Kabupaten (District Sectoral Minimum Wage) UPL Upaya Pengelolaan Lingkungan (Environmental Management Efforts)



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Appendix 3 : List of Stakeholders Interviewed and Co ntacted

No. Name of Stakeholders Institution - Address Remark

Stakeholders Interviewed On-Site :

1. Mr. Nur Arofat Estate Manager MS 3 2. Mr. Budiansyah Estate Manager MS 2 3. Mr. Suhtiami Estate Manager MS 1 4. Ms. Mayang POM 1 5. Mr. Sugiono POM 1 6. Mr. Septa EMU 7. Mr. Wibowo MS 2/Smallholder 8. Mr. Siahaan MS 3 9. Mr. Muling POM 2

10. Mr. Junaidi MS2/Inti 11. Mrs. Winarni Sprayer 12. Mrs. Irawati Sprayer 13. Mr. Syahiruddin Harvester 14. Mrs. Rusmiati PIC PPE Storage (MS2) 15. Mr. Raymond FC (MS2) 16.

Appendix 4: Observations and Opportunities for Impr ovement

No. Observations / Opportunities for Improvement Criteria 1. Board of emergency number information in emplasment C (MS3 estate) has not been

updated example emergency number information for contact person of fire fighters not relevant because he has not joined with company since year 2012

RSPO P&C 4.7.5

2. Tools of electric indicator monitor has been broken in genzet room – empalsment such as ampermeter (A) : 2 unit and voltmeter.

3. “Agriculture Manual dan Standard Operating Procedure for Oil Palm 2011” should re-viewed again because there are procedure not relevant with current condition.

RSPO P&C 4.1.1

4. The mill carried out calibration of measuring instrument again in process station and laboratorium.

RSPO P&C 4.1.1

5. Flow meter for outlet in POME pond should carried out calibration. RSPO P&C 5.3.2

6. Fill in temperature information in pressing station logsheet with consistency RSPO P&C 4.1.1

7. Agreement with PT Maju Asri Utama as collector company for hazardous and toxic waste should revised

RSPO P&C 5.3.2

8. • Mandatory parameter as requirement of drink water quality was appropriated with Minister of Health regulation no. 492/Menkes/Per/IV/2010

• Re-paint for pillars as border of agrochemical activities and consistent for their length

• MS1 POM shall monitoring of renewal of land application permit process

• MS2 POM shall monitoring of issue of land application permit process

RSPO P&C 4.4.1

9. The company continue develop of trench boundary in blocks which bordering with 808 ha (outside land use right (HGU) areas) and create of nomenclature different for block it

RSPO P&C 2.2.3

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