RSPO PRINCIPLES & CRITERIA CERTIFICATION … › sites › default › files › MY_02517_Asia...CONTACT PERSON: ABDUL HAYE SEMAIL Tel: +6 (03)5121 2320 - Fax: +6 (03)5122 5927 RSPO

SGS RSPO

(Principles & Criteria)

Doc. Number: GP 7003A

Doc. Version date: 01 April 2013

Page: 1 of 71

SGS RSPO, SGS (Malaysia) Sdn. Bhd., No. 26, Jalan Anggerik Vanilla, 31/93,

Kota Kemuning, 40460 Shah Alam, Malaysia

CONTACT PERSON: ABDUL HAYE SEMAIL Tel: +6 (03)5121 2320 - Fax: +6 (03)5122 5927

WWW.SGS.COM

RSPO PRINCIPLES & CRITERIA CERTIFICATION REPORT

Public Summary Information

Project Number: MY02517

Certificate No.: SGS-RSPOPM-MY13/01090

Validity Period: 31st January 2013 to 30th January 2018

Report Ref. No.: Asia Production Unit – Surveillance Assessment Report (MY02517)

RSPO Membership

No.: 2-0094-08-000-00

Client Name: Carotino / J C Chang Group Website: www.carotino.com

Scope: Purchase of RSPO certified FFB, processing and sales of RSPO certified Crude Palm Oil (CPO) and Palm Kernel (PK) by using Mass Balance (MB) Module E Supply Chain Option.

Type of Certificate

Holder: INDIVIDUAL

Number of Mill: 1 Number of Sites: 1 mill and 3 Estates

Mill Capacity: 40 TPH

Annual CPO Produced

(MT):

( 2012/13 )

From own supply based estates : 35,694.41 MT From Melewar Production Unit- awaiting approval : 668.42 MT

Address:

Street and number:

Town/City

State/Country

Zip/Postal code

Country

Head Office

Unit 30-08, Mail Box 238, Menara Landmark, No.12, Jalan Ngee Heng, 80000, Johor Bahru, Johor, Malaysia

Mill Address

Asia Palm Oil Mill

Km 45 Off Jalan Lahad Datu – Sandakan,

Lahad Datu,91100

Sabah.

Mill Manager : Chong Chung Wai

[email protected] Tel : 089-567012 ( Mill )

Fax : 089-563091 ( Mill )

Contact Person:

Mr. Seow Chee Chiang

Estate Department Manager (Admin. / Sustainability)

07-2231633 ( HQ, Johor )

[email protected]

OR

[email protected]

Country: Malaysia

Plantation Unit

Being Evaluated:

Supply Base Name & Address

Asia Oil Palm Estate 2

3,024 ha

Hwa Li Estate 3

4,277.6 ha

Melewar Estate 2

2,023.4 ha

Total Certified Area

(Ha):

9,325 ha

Total FFB Produced

(MT):

170,958.45 MT

( own supply base )

End of Public Summary

http://www.carotino.com/

mailto:[email protected]



GP 7003A Page 2 of 71

BASIC EVALUATION INFORMATION

MAIN EVALUATION

Evaluation Dates: 10th – 14th October 2011

Team Leader/Team: James S H Ong

Affiliate Project Manager: Date:

Report approved by: Haye Semail Date: 31/01/13

Certification approved by: Kenny Looi Date: 31/01/13

Database logged by: Othman Shahziela Date: 31/01/13

SURVEILLANCE 1

Evaluation Dates: 28th

– 31st Oct 2013

Team Leader/Team: James S H Ong


Report reviewed & approved by: Haye Semail Date: 11 Jan 14

Certification approved by: Kenny Looi Date: 13 Jan 14

Database logged by: Othman Shahziela Date: 13 Jan 14

SURVEILLANCE 2

Evaluation Dates:

Team Leader/Team:


Report reviewed & approved by: Date:

Certification approved by: Date:

Database logged by: Date:

SURVEILLANCE 3

Evaluation Dates:

Team Leader/Team:





SURVEILLANCE 4

Evaluation Dates:

Team Leader/Team:






TABLE OF CONTENTS

SUMMARY ............................................................................................................................................................... 4

List of Abbreviation ................................................................................................................................................ 5

1. scope of certification assessment ......................................................................................................... 6

1.1 National Interpretation Used ..................................................................................................................... 6

1.2 Certification Scope .................................................................................................................................... 6

1.3 Location and Maps .................................................................................................................................... 6

1.4 Description of Supply Base and Mill Processing Capacity ...................................................................... 10

1.5 Date of Planting and Cycle ..................................................................................................................... 11

1.6 Other Certification Held ........................................................................................................................... 11

1.7 Organizational Information and Contact Person ..................................................................................... 12

1.8 Time-bound Plan for Other Management Units ...................................................................................... 12

1.9 Area of Plantation ................................................................................................................................... 12

1.10 Date Certificate Issued and Scope of Certificate ................................................................................ 13

2. Assessment Process ............................................................................................................................. 13

2.1 Certification Body .................................................................................................................................... 13

2.2 Assessment Methodology, Programme, Site Visits ................................................................................ 13

2.3 Qualification of Lead Assessor and Assessment Team.......................................................................... 15

2.4 Stakeholder Consultation and List of Stakeholders Contacted ............................................................... 15

3. Assessment Findings ............................................................................................................................ 16

3.1 Summary of Findings .............................................................................................................................. 16

3.2 Corrective Action Request ...................................................................................................................... 61

3.3 Noteworthy Positive & Negative Observation ......................................................................................... 61

3.4 Status of Non-Conformities Previously Identified .................................................................................... 61

3.5 Issues Raised by Stakeholders and Findings ......................................................................................... 61

4. Acknowledgement of Organization Internal Responsibility .............................................................. 62

4.1 Date of Next Surveillance Visit ................................................................................................................ 62

4.2 Date of Closing Non-Conformities .......................................................................................................... 62

4.3 Acknowledgement of Internal Responsibility and Formal Sign-off Assessment Findings ....................... 62

APPENDIX A: CORRECTIVE ACTION REQUEST & OBSERVATION ................................................................ 64

APPENDIX B: NON-CONFORMITIES PREVIOUSLY IDENTIFIED ..................................................................... 66

APPENDIX C: TIMEBOUND PLAN ....................................................................................................................... 69

APPENDIX D: LIST OF STAKEHOLDERS CONTACTED.................................................................................... 70

LIST OF TABLES

Table 1: Mill and Supply Base GPS Location ...................................................................................................... 6

Table 2: Area and FFB Prodcution from the Supply Base Estates ( FY July ‘12/ June ‘13 ) ............................ 10

Table 3: Mill Processing Data ( FY July ‘12/ June ‘13 ) ..................................................................................... 11

Table 4: Planting Age Profile for the Supply Base Estates ( FY July ‘12/ June ‘13 ) ........................................ 11

Table 5: Area Statement of the Supply Base Estates ( July '12/ June 13 )....................................................... 12

Table 6: Assessment Programme ..................................................................................................................... 13


Table 7: Auditors Profile ..................................................................................................................................... 15

LIST OF FIGURES

Figure 1: Location Map of Asia Produciton Unit in the State of Sabah, Malaysia ............................................... 7

Figure 2: Supply Base Estates and Mill Location within the Kinabatangan District of Sabah............................ 8

Figure 3: Asia Production Unit Supply Base Estates ........................................................................................... 8

Figure 4: Melewar Estate 2 Layout ...................................................................................................................... 9

Figure 5: Asia Oil Palm Estate 2 Layout .............................................................................................................. 9

Figure 6: Hwa Li Estate 3 Layout ....................................................................................................................... 10

LIST OF APPENDICES

As above

SUMMARY

Carotino is a member of the vertically integrated J.C. Chang Group of companies with interests in

plantations, palm oil mills and downstream processing activities that practices sustainable agriculture.

In its downstream activities, Carotino is one of the major player in the oil palm industry producing oil palm-

based products for the consumer in the food service and Industrial products, neutraceuticals, animal feed,

oleochemicals and biodiesel.

Information can be obtained from their website www.carotino.com

The group owns and manages oil palm plantation known as Production Units. Asia, Carotino, Melewar and

Takon Production units are the Units under Carotino Sdn Bhd/ J C Chang Group.

Presently, both Carotino Production Unit which is located in the state of Pahang and Asia Production Unit

located in the state of Sabah in Malaysia has been RSPO-certified.

The Carotino Production Unit comprises of 1 palm oil mill and 5 oil palm plantations sited in 3 locations in

the State of Pahang, Peninsular Malaysia, covering a total land area of 10,243 hectares. They were

recommended for the certification against the RSPO P&C MYNI requirements April 2010

The Asia Production Unit comprises of 1 palm oil mill and 3 oil palm plantations sited in the district of

Kinabatangan in the state of Sabah, Malaysia, covering a total land area of 9, 325 hectares. They were

recommended for the certification against the RSPO P&C MYNI requirements in January 2013.

Melewar Production Unit will be the third Unit for Carotino / JC Chang Group to be RSPO certified. It is

awaiting approval from RSPO. It comprises of Asia Palm Oil Mill and the 5 Carotino / JC Chang Group’s

own supplying estates namely Gerola Estate, Tye Yang Estate, Pahang Oil Palm Estate 2, Pahang Oil Palm

Estate 3 and Melewar Estate 1 with a total land area of 12,979.77 ha sited in the same location as Asia

Production Unit in the District of Kinabatangan, Lahad Datu ,State of Sabah, Malaysia.

The Takon Production Unit comprises 4 oil palm plantations and 1 mill sited in the District of Lahad Datu ,

and Tawau, State of Sabah, Malaysia, covering a total land area of 6,657 hectares.



LIST OF ABBREVIATION

Short Form Meanings

AOPE2 Asia Oil Palm Estate 2

APOM Asia Palm Oil Mill

APU Asia Production Unit

BOD Biological Oxygen Demand

CAR Corrective Action Request

CHRA Chemical Health Risk Assessment

CPO Crude Palm Oil

DID Department of Drainage and Irrigation, Malaysia

DOE Department of Environment, Malaysia

EFB Empty Fruit Bunch

EIA Environment Impact Assessment

EMS Environmental Management System

EQA Environmental Quality Act

ERT Endangered, Rare and Threatened species

ESA Environmentally Sensitive Area

FFA Free Fatty Acids

FFB Fresh Fruit Bunches

FR Forest Reserve

GE Gerola Estate

Ha Hectare

HCV High Conservation Value

HDPE High Density Polyethylene

HL3 Hwa Li Estate 3

IPM Integrated Pest Management

ISO International Organisation for Standardisation

IUCN International Union for Conservation of Nature and Natural Resources

JCC Joint Consultative Committee

JUPEM Jabatan Ukur dan Pemetaan Malaysia (Department of Survey and Mapping Malaysia)

K Potassium

kW Kilowatt

M Meter

ME 2 Melewar Estate 2

Mg Magnesium

Mm Millimeter

Mt Metric ton

MPOM Melewar Palm Oil Mill

MPU Melewar Production Unit

MYNI Malaysia National Interpretation

N Nitrogen

NGO Non Governmental Organisation

OA Orang Asli (Indigenous People)

OER Oil Extraction Rate

OSH Occupational Safety & Health

P Phosphate

P & C Principles and Criteria

PK Palm Kernel

POME Palm Oil Mill Effluent

PPE Personal Protective Equipment

POP2 Pahang Oil Palm Estate 2

POP3 Pahang Oil Palm Estate 3


PT Pejabat Tanah (Coding for Pahang Land Office)

SOP Standard Operating Procedures

Sdn Bhd Sendirian Berhad (Private Limited)

SEIA Social and Environment Impact Assessment

Sg Sungai

SGS Societe Generale de Surveillance

SOP Standard Operating Procedures

SPC Senior Plantation Controller

TPH Tonnes per hour

TY Tye Yang Estate

USECHH Use and Standards of Exposure of Chemicals Hazardous to Health

WHO World Health Organisation

yr Year

1. SCOPE OF CERTIFICATION ASSESSMENT

1.1 National Interpretation Used

The operations of the mill and their supply based of FFB were assessed against the

Roundtable on Sustainable Palm Oil (RSPO), Principles and Criteria (P&C) – Malaysia

National Interpretation (MY-NIWG dated 26th

April 2008).

1.2 Certification Scope

The scope of certification includes the Asia Palm Oil Mill and its supply base according to the

standard of Roundtable on Sustainable Palm Oil (RSPO), Principles and Criteria (P&C) –

Malaysia National Interpretation (MY-NIWG dated 26th

April 2008) and RSPO Supply Chain

Certification Standard dated 25 November 2011.

1.3 Location and Maps

Asia Production Unit is located in district of Kinabatangan, Lahad Datu, Sabah , Malaysia

(Figure 1 and 2 ). More detailed information on the estates location and layouts is shown in

Figures 3 - 6. The GPS locations of the mill and supply base estates are shown in Table 1.

Table 1: Mill and Supply Base GPS Location

Mill/Supply Base Longitude Latitude

Asia Palm Oil Mill 5.30°N

118.21°E


5.30°N 118.20°E

Hwa Li Estate 3

5.34°N 118.31°E

Melewar Estate 2

5.26°N 118.15°E


Figure 1: Location Map of Asia Produciton Unit in the State of Sabah, Malaysia

sandakan

Lahad Datu

Asia Production Unit


Figure 2: Supply Base Estates and Mill Location within the Kinabatangan District of Sabah

Figure 3: Asia Production Unit Supply Base Estates


Figure 4: Melewar Estate 2 Layout

Figure 5: Asia Oil Palm Estate 2 Layout


Figure 6: Hwa Li Estate 3 Layout

1.4 Description of Supply Base and Mill Processing Capacity

The FFB is sourced from the three ( 3 ) supply base estates of Asia Production Unit which is

directly managed by Carotino / J C Chang Group. In addition, FFB from the neighbouring

Carotino/ J C Chang Group Melewar Production Unit occasionally is processed. The Mill also

receives crop from smallholders surrounding the Asia Production Unit.

The crop yield from the supply base estates are listed in Table 2 below.

Table 2: Area and FFB Prodcution from the Supply Base Estates ( FY July ‘12/ June ‘13 )

Name of

estate

Plantation area Annual FFB

Production

(MT)

Title

area Immature Production

(ha)

Conservation

/HCV

(ha)

*Others

Asia Oil

Palm

Estate 2

3024 0 2,723.70 0 300.30 66,157.78

Hwa Li Estate 3

4277.6 0 3851.56 7.51 418.53 85,575.15

Melewar Estate 2

2023.4 0 1770.41 0 252.99 46,247.34


Total 9,325 0 8345.67 7.51 971.82 197,980.27

*Others : Transmission tower, Quarry, Roads, line site, rives, water catchment area, office building ,etc

Table 3: Mill Processing Data (FY July ‘12/ June ‘13 )

Financial Year

( FY12/13 )

Mill Production Figures (MT) (Audited Estate)

FFB Received FFB Processed CPO Produced PK Produced

Certified Crop ( Supply

Base ) 170,958.45 170,958.45 35,694.41 9,154.18

From Melewar

Production Unit ( am

awaiting RSPO

Certification )

3,356.69 3,356.69 668.42 177.83

Total to claim

Certified 174,315.14 174,315.14 43,384.16 9,332.01

Other Carotino ( Yet to

be -Certified Unit ) 0 0 0 0

Outside Crop

(smallholders etc ) 34,210.26 34,210.26 7,021.33 1,436.91

Total 208,525.40 208,525.40 43,384.16 10,768.92

OER: 20.84% KER: 5.17%

1.5 Date of Planting and Cycle

The age profiles for all the estates are simplified in Table below.

Table 4: Planting Age Profile for the Supply Base Estates (FY July ‘12/ June ‘13)

Name of supplying

estate

Planting Age (Ha)

Immature

( <2 y-o ) >2 - <5 years >5 - 10 years >10 - 15 years >15 - 24 years

Asia Oil Palm

Estate 2 0 0 22.52 0 2,701.18

Hwa Li Estate 3

0 0 0 1,414.30

2,437.26

Melewar Estate 2

0 0 0 0 1,770.41

Total 22.52 1,414.30 6,908.85

1.6 Other Certification Held

The Unit is undergoing ISCC certification


1.7 Organizational Information and Contact Person

The company contact person details are as follows:

Name: Mr. Seow Chee Chiang

Designation: Estate Department Manager (Admin / Sustainability)

Address: Unit 30-08, Mail Box 238, Menara Landmark, No.12, Jalan Ngee Heng, 80000, Johor Bahru, Johor, Malaysia

Contact No.: 07-2231633 ( HQ, Johor )

Email address: [email protected] or

[email protected]

1.8 Time-bound Plan for Other Management Units

Carotino / JC Chang Group is a member of RSPO and has been involved in the certification

since 9/5/2006 with the membership number of 2-0094-08-000-00

Carotino / JC Chang Group owns and operates 4 mills and 17 oil palms estates, together with 4

Units known as Production Units covering approximately 38,300 ha in Malaysia. Carotino / JC

Chang Group has developed a time-bound plan (Appendix A) for the phased implementation of

the RSPO P&C, commencing with mills and estates. Carotino / JC Chang Group will use the

experience gained from achieving certification of the first few mills and estates to implement the

RSPO P&C in parallel with the remainder of its operations. The SGS assessment team

considers that Carotino / JC Chang Group is on the right track which is reasonable and

challenging, given the widespread geographic locations of its properties, the resources required

and the numbers of smallholders involved.

1.9 Area of Plantation

The areas of supplying estates for this operating unit are listed in Table 4. Details of production

area (mature/immature) are also listed.

Table 5: Area Statement of the Supply Base Estates ( July '12/ June 13 )

Name of supplying estate

Estates Area (Ha)

Immature Mature Area Non-Cultivated Total (Ha)

Asia Oil Palm Estate 2 0 2,723.70 300.30 3024

Hwa Li Estate 3

0 3,851.56 426.04 4277.6

Melewar Estate 2

0 1,770.41 252.99 2023.4


Total 0 8,345.67 979.33 9,325

1.10 Date Certificate Issued and Scope of Certificate

The certificate issue date is the date of RSPO approval of this assessment report. This

certification scope is : Purchase of RSPO certified FFB, processing and sales of RSPO certified

Crude Palm Oil (CPO) and Palm Kernel (PK) by using Mass Balance (MB) Module E Supply Chain

Option.

2. ASSESSMENT PROCESS

2.1 Certification Body

Founded in 1878, the SGS Group is the world’s largest auditing, inspection, testing and

verification organization. Truly global and benefiting from unique international network of more

than 1180 offices, 321 laboratories and 50,000 full time staff, the SGS Group is able to provide

its international clientele with a comprehensive range of services in more than 145 countries.

SGS has no manufacturing, trading or financial interests which could compromise its

independence. Its guarantee of independence, its reputation for professionalism, integrity and

impartiality, as well as it remarkable international network, place the SGS Group in a unique

position.

The RSPO Programme is the SGS Group’s RSPO Certification Programme internationally

accredited by the RSPO Executive Board to carry out oil palm plantation and supply chain

certification/verification and accreditation for global RSPO certification.

2.2 Assessment Methodology, Programme, Site Visits

The assessment was conducted in three ( 3) audit days and involving a sample of two ( 2)

estates and the Oil Mill of Asia Production Unit. The audit covers documentation review, internal

procedures, management system, field inspection as well as identification of any significant

issues for both environment or social issues. A sample of stakeholders was consulted during

the assessment to get their feedback on the management.

The assessment was conducted based on random samples and therefore nonconformities may

exist which have not been identified. The methodology for objective evidence collection included

physical site inspection, observation of tasks and processes, interview with workers, families

and stakeholders, documentation review and monitoring data.

The assessment program is included as shown in Table 6 below.

Table 6: Assessment Programme

Date Location Activities

28th

Oct 2013 Carotino Training

Centre

Arrive Sandakan,

Lunch,

Travel to Location Kinabatangan


29th

Oct 2013

Opening Meeting

Safety Briefing

Audit Scheduling ( RSPO & ISCC )

Auditor 1

- Safety Briefing by Mill

– Mill Supply Chain

- Licences, SOPs, Environment, Safety ,

Accident records, Insurance, Pricing Mechanism

Interview – Smallholder Smart Foremost chief

clerk Nur, Gender chairwoman Halijah, Accident

worker Burhan, Ramp mandor Zamri

Mill visit – Scheduled Waste, Chemical storage,

workshop, Boiler , Vertical Steriliser construction

site, Ramp – Grading Station, First aid,

emergency response procedure, Recylce bins

Auditor 2 - Melewar Estate 2

Spraying (Interview)

HCV Area

Riparian & Bufferzone

Line site ,Landfill, Creche

Interview with JCC’s and Gender

Committee

Documents review @ Melewar Estate 2

30th

Oct 2013 Asia Oil Palm

Estate 2

Muster Ground

Storage – Lubricants, chemicals and fertilizer

store

Schedule waste store and Empty container

store

PPE ( manurers ) , Pre-Mix operation and First

aid kit

Manuring activities ( F11-8), spraying operators(

F4-2 ) harvester

Riparian

Boundary stone @ F96G14

Land irrigation in F94 E8

Land fill 94 E15

Linesite

Workshop

Mill construction contractor line site

Interview HA

Document review

31st Oct 2013

Carotino Training

Centre, , located at

Asia Oil Palm

Estate 2

Closing Meeting at Carotino Training Centre

Findings & Recommendation

End of audit

Auditors travel to Sandakan


2.3 Qualification of Lead Assessor and Assessment Team

SGS Malaysia Sdn Bhd holds copies of educational qualifications, certificates and audit logs for

each of the audit team members. SGS has evaluated the qualifications and experience of each

audit team member and has registered the following designations for conducting RSPO

Assessment. Summary of auditors’ educational background and experience are listed in Table

7 below.

Table 7: Auditors Profile

Evaluation Team Notes

Team Leader –

Auditor 1 -

Plantation

James S H Ong, B. Agr. Sc is an agronomist by training. He has years

experience in the agriculture sector in Malaysia having worked as Assistant

Plantation Manager in a number of estates in Malaysia. He is well versed with

agrochemical and fertiliser applications. Has undergone ISO 14000 and

RSPO Lead Auditor training and has been involved in a number of audits on

oil palm plantations

Auditor 2 –

Environment and

Social

Mohd Faisal Jaafar is a degree holder in forestry from Universiti Putra

Malaysia. Faisal has a 7 years experience in operating Malaysian Timber

Certification Scheme with specialization in forest management certification

and forest plantation management certification. Has undergone the

necessary ISO 9000 Lead Auditor course and has gathered substantial

auditing experience pertaining to forest certification.

2.4 Stakeholder Consultation and List of Stakeholders Contacted

This is a surveillance audit and stakeholders will be interviewed during the assessment.

Stakeholder consultation took place in the form of meetings and interviews.. See Appendix E

for stakeholder’s details and comments, if any.

SGS RSPO

(Principles & Criteria)

Doc. Number: GP 7003A

Doc. Version date: 01 April 2013

Page: 16 of 71

SGS RSPO, SGS (Malaysia) Sdn. Bhd., No. 26, Jalan Anggerik Vanilla, 31/93,

Kota Kemuning, 40460 Shah Alam, Malaysia

CONTACT PERSON: ABDUL HAYE SEMAIL Tel: +6 (03)5121 2320 - Fax: +6 (03)5122 5927

WWW.SGS.COM

3. ASSESSMENT FINDINGS

3.1 Summary of Findings

3.1.1 Principles & Criteria

As outlined, objective evidence was obtained separately for each of the RSPO Indicators and criterion

for the mills and estates. The results for each indicator from each of the operational areas were

evaluated to provide an assessment of conformity. A statement is provided for each of the RSPO

indicators in order to support the findings of the assessment team.

There is 0 Major Non-conformities and 0 Minor Non-conformities identified during this assessment.

Some areas identified with potential areas for improvement has led into 02 Observations raised.

Details for each Non-conformities and observations are given in Appendix C. Major Non-conformities

has been closed out within the period of 60 days after the assessment. Minor Non-compliances and

Observations will be followed up during the next Annual Surveillance Audit which is scheduled to be

conducted within the period of twelve months after the RSPO approval of Main Assessment.

Principle 1: Commitment to Transparency

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

1.1.1 Records of requests and responses must be maintained. Major

Findings In compliance: Yes: x No:

Objective

evidence: Asia Production Unit (APU) under the Carotino /J C Chang Group Group has a website www.carotino.com for the promotion of its products. The website also contains information about the company’s corporate structure, its policy and management objectives.

Asia Production Unit (APU) has established the Guideline on Mechanism for Information Requests by Stakeholders to deal with stakeholder’s request for information on environment, social and legal issues.

The Asia POM & estates maintain ‘ Stakeholder Requests Register’ record all request made and actions taken to address the request. A file is maintained containing the original request documents (letter & form) and summary register.

APOM has a book known as ‘ Records of request and responses ‘ and according records the response is within 3 days. Most of the request are from their sister estates.

The mill do not get request from external stakeholders . Yearly , meeting with the external stakeholders like Kampung Sg Koyah as part of their social responsibility is minuted and the requests of the villages will be raised during the MECM ( Mill and Estate consultative Meetings ) meeting conducted at least quarterly to prioritise the requests .

During the assessment, it was observed that the company has compiled a list of stakeholders that may be relevant to the APU operation. The stakeholder list include estate group, school, local communities, statutory bodies, contractors, FFB supplies, visitors, neighbouring plantations and NGOs.

Under the MYNI 2008, it is the requirement that growers and millers respond constructively and promptly to requests for information from stakeholders. The company has documented a ‘Guidelines on mechanism for information request’ that defines the responsibilities and actions required for receiving, recording and responding to enquiries and requests from stakeholders.

The company maintained both soft and hard copy record and evidences of communication with



stakeholders. The APOM Stakeholders Request file has been maintained since 16/7/2009. Stakeholders have a choice of both verbal and written request. It was also observed that a joint consultative committee (JCC) has been established to handle internal stakeholders (i.e. workers).

Observed that most of request made received from internal stakeholders i.e. workers and mandores. However there are some instances whereby there requires are received from local external stakeholders. The company has entertained all request received by applying the “Borang Aduan/Cadangan/Permintaan”. Details of request are as follows:

Date Stakeholder details response

18 July 2013 Kampung Koyah B Application to obtain gravel for road construction

The company has responded by approving the application dated 20 July 2013.

Evidence of communication and discussion with the stakeholder is also recorded that is recorded by the administration clerk and approved by the manager of estate.

16 June 2013 En. Madami (external stakeholder) – Vegetable & fish seller

Request to enter estate to sell Vegetable & fish

The company has responded by approving the application dated 27 June 2013.

Evidence of approval in the form of letter dated 27 June 2013, signed by the estate manager is made available to the audit team.

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

1.2.1,

1.2.2,

1.2.3

1.2.4

1.2.5

1.2.6

1.2.7

Land titles / user rights (C 2.2)

1.2.1 Land titles / user rights (C 2.2) 1.2.2 Safety and health plan (C 4.7) 1.2.3Plans and impact assessments relating to environmental and social impacts (C 5.1, 6.1, 7.1, 7.3) 1.2.4 Pollution prevention plan (C 5.6) 1.2.5 Details of complaints and grievances (C 6.3) 1.2.6 Negotiation procedures (C 6.4)

1.2.7 Continuous improvement plan (C 8.1)


Objective

evidence: As mentioned above, management documents and policy are publicly available at the website www.carotino.com . Policies, SOPs, work instructions are also posted on notice boards at the estate and mill for workers and public view

The following documents are publicly available:

Land titles/ user rights

Safety and health plan

Plans and impact assessment relating to environment and social impacts

Pollution prevention plans

Details complaints and grievances

Negotiation procedures

Continuous improvement plans

Principle 2: Compliance with Applicable Laws and Regulation

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

2.1.1 Evidence of compliance with legal requirements Major


Objective

evidence: Asia Production Unit has maintained a list of applicable local, national and ratified international laws and regulations.



Evidences of compliances to the applicable laws were shown by permits and licences displayed in the office and kept in the file.

Examples of compliances are as in the table below: :

Legal requirement Evidence of compliance Estate

Malaysian Palm Oil Board Act 1988 ( Act 582)

MPOB license no. 502001-102000 valid until 30 Apr 2014


MPOB license no. 502542002000 valid until 31 Jul 2014

Melewar Estate 2

502246302000 valid until 31 Jul 2014

Hwa Li Estate 3

MPOB license no. 500143104000 valid until 30 /11/ 2013

Asia Palm Oil Mill

330,000 MT

DOE ( Jabatan Alam Sekitar )

JPKKS/12/004831

Valid till 30/06/2014

Asia Palm Oil Mill

Alurair( pengairan Ladang ) dan Kompos

Occupational Safety and Health Act 514

Appointment of Safety Officer -

Asia Palm Oil Mill

The company maintains all relevant documents pertaining to laws and legals as follows:

Items Remarks/Ref. No. Validity

Diesel/Petrol/Fertilizer Storage

B.PGK.LDU 22/2009 (SK) (under renewal)

Under renewal

Trading License F 867215 valid until 31 December 2013 Until 31 December 2013

Weighbridge Stamping License

B 785992 valid until 14 February 2013 Until 14 February 2013

License to Employ Foreign Workers

JTK.H.KBN.600-4/1/01117/0066 valid until 03 December 2013

Until 03 December 2013

Genset/Electricity License

License No. SSD513/2013 valid until Until 07 August 2014

Air Compressor License SB PMT 1239 Until 07 August 2014

MPOB License License No. 502932802000 Until 30 September 2014

In addition, the land titles for each of the estates are also available. Example of land titles verified during the audit are as follows:

Land titles for Melewar 2 Estate – CL 095311201 dated 30 July 1979 covering an area totalling to 2,203.4 ha.

Land titles for Asia Oil Palm Estate – CL 095317383 dated 11 July 1989 covering an area totalling to 3,024 ha.

2.1.2 A documented system, which includes written information on legal requirements Minor


Objective

evidence: APU has established a documented system to identify the existing legal requirement in the oil mill and plantation. The system contains information on the legal requirements:

The Unit maintain copy of relevant laws and legislation pertaining to palm oil mill and the


plantation operation as per listed in the standard. Observed that the list has been adequately reviewed with the latest revision was conducted on 08 September 2013.

2.1.3 A mechanism for ensuring that they are implemented Minor


Objective

evidence: APU has established a mechanism to ensure that the documented system on compliance to legal requirements are implemented

At the Oil Mill , licenses and permits are displayed on the wall of the General Office with expiry dates highlighted to attract attention for renewal

The Mill Manager , Mr Henry Chong Chung Wai, is the person responsible for compliance as stated in the appointment letter of the person responsible for legal changes dated 12/01/13.

SOP on Mechanism to track changes in the legal requirement is found in Doc. Ref No: E/005-03/2011 ver.3.

As reflected in the SOP, the Estate Department Cum Sustainability Manager based at the Group’s HQ is responsible for monitoring the changes in law and distributing the information to the mill and plantations.

2.1.4 A system for tracking any changes in the law Minor


Objective

evidence: APU has established a mechanism system for tracking any changes in the law .

The document “SOP on Mechanism to Trace Changes in Legal Requirements ( Doc Ref. No.: E/005-03/2011) updated on 26 July 2011 is available at ME 2 and AOPE 2

APU’s Head Office has subscribed to the Malaysia Gazette On-Line with the website at www.lawnet.com.my to track any revision or changes in laws that govern the general and specific rules and regulations of the Malaysian oil palm industry.

APU has appointed the Estate Department cum Sustainability Manager (EDSM) responsible to track and update for any relevant changes that will affect both for estates and mill.

The changes of the laws has been recorded in Law Changes Index maintains by estates and mill. For e.g. for the month of Aug 2012, the ESDM has informed the latest changes of the local law - P(U)A 215/2012 Minimum Wages Order 2012

In addition, the company also has taken action to subscribe to the lawnet for an update of the latest laws and regulation in Malaysia. Evidence of subscription to the www.lawnet.com.my on latest publication / revision in laws. Latest update made by the lawnet to the company dated 29 August 2013 is available.

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

2.2.1 Evidence of legal ownership of the land including history of land tenure Major


Objective

evidence: APU has maintained a legal ownership of the land including history of land tenure.

The land titles for each of the estates are also available. Example of land titles verified during the audit are as follows:

Land titles for Melewar 2 Estate – CL 095311201 dated 30 July 1979 covering an area totalling to 2,203.4 ha.

Land titles for Asia Oil Palm Estate – CL 095317383 dated 11 July 1989 covering an area totalling to 3,024 ha.

“The said land is demised hererein expressly and only for the purpose of the cultivation of an agricultural crop of economic value”.

2.2.2 Growers must show that they comply with the terms of the land title. [This indicator is to be read with Guidance 2]

Major


http://www.lawnet.com.my/


Objective

evidence: APU has complied with terms of the land title.

The terms of the land title stated that “The said land is demised herein expressly and only for the purpose of the cultivation of oil palm, cocoa and coconuts. Detail of the land can be extracted from land title which available in the estate filing”

All the estates has complied with the terms of the land title.- Agricultural Crops of Economic Value.

2.2.3 Evidence that boundary stones along the perimeter adjacent to state land and other reserves are being located and visibly maintained

Minor


Objective

evidence: Boundary stones along the perimeter adjacent to state land and other reserves can be located where available and visibly maintained, where possible .

During the field visit , boundary stone 921/883 was found along the boundary with the neighbouring estate . the point was marked using a red-white marked-stake

2.2.4 Where there are, or have been, disputes, proof of resolution or progress towards resolution by conflict resolution processes acceptable to all parties are implemented. (CF 2.3.3, 6.4.1 and 6.4.2)

Minor


Objective

evidence: It is surrounded by big plantations and small holders. There is no land dispute. Stakeholder consultations have been carried out to confirm there are no disputes.

All estate practices and implementations are within the National and Local Laws and Regulation.

The Asia Production Unit does not have any land disputes. But a system to resolve land disputes is documented in ‘Complaints and Grievances’ procedure.

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

2.3.1 Where lands are encumbered by customary rights, participatory mapping should be conducted to construct maps that show the extent of these rights.

Major


Objective

evidence: All the three estates are with proper legal title. The establishment of the plantations do not diminish legal or customary rights of any communities. As described earlier, the land is with clear and undisputed boundaries.

Clear physical boundary demarcation with legally recognized plan is observed during site visits. In addition there are no dispute/claims by the neighbors on the estate’s land.

2.3.2 Map of appropriate scale showing extent of claims under dispute Major


Objective

evidence: Customary use of land for community purposes have been identified either on maps (places of worship, burial grounds, and archaeological site) and maintained.

2.3.3 Copies of negotiated agreements detailing process of consent (C 2.2, 7.5, 7.6) Minor


Objective

evidence: Currently, there are no claims on legal or customary rights exist for the estate.

Principle 3: Commitment to Long-Term Economic and Financial Viability

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

3.1.1 Annual budget with a minimum of 2 years of projection Major



Objective

evidence: Annual budget with a minimum of 2 years of projection are available.

“Summary of Mature Palm Oil Palm Budget Forecast For 3 Years”

FY 2013/2014

FY 2014/2015

FY 2015/2016

Break down to

- Upkeep & Cultivation

- Collection

- General Charges

- Depreciation

Annual budgets for the mill and estate operations are available. Annual crop budget and operation budgets have been projected till 2014 - 2015 The plan is based on estimate of yield/production. Budgets included allocations for social & environmental/biodiversity conservation programme.

3.1.2 Annual replanting programme projected for a minimum 5 years with yearly review Minor


Objective

evidence: Annual replanting programme projected for a minimum 5 years with yearly review are available . this was seen documented at :

2013/14 2014/15 2015/16 2016/17 2017/18

AOPE2 0 0 265 ha 241 ha 236 ha

HL3 0 0 0 0 0

ME2 0 0 0 0 0

Total 0 0 265 ha 241 ha 236 ha

Principle 4: Use of Appropriate Best Practices by Growers and MIllers

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

4.1.1 Documented Standard Operating Procedures (SOP) for estates and mills Major


Objective

evidence: Estates and Oil Mill have the Documented Standard Operating Procedures file that contains both the safe operating procedure and the procedure to implement the operation identified as critical for example in the Estates the SOP Manual has procedures of the operations :

a) For Oil palm nursery and replanting

b) For Upkeep and cultivation

c) Soil ,water and Biodiversity & conservation

d) FFB Harvesting and Despatch

e) Legal

f) Vehicle and Management

g) Store Management

h) Building and Maintenance


i) Pest and disease management

j) OSH

The estate has the SOP in English and Bahasa Malaysia

They have a Safe Operating Procedure file that emphasises safety guidelines and procedures

The Asia Oil Mill SOP is found in the Safety Operation Procedure that contains the procedures for the critical control point below:

The following Standard Operation Procedure are complete to cover the implementation of all elements in the Supply Chain requirements :

SOP-Reception Station (CCP/01-02-2013-AOM )

SOP-Grading Station (CCP/02-02-2013-AOM)

SOP- Extraction Station (CCP/03-02-2013-AOM)

SOP-Clarification System (CCP/04-02-2013-AOM)

SOP-Nut & Kernel Plant (CCP/05-02-2013-AOM)

SOP- Lab Monitoring (CCP/06-02-2013-AOM)

SOP- Despatch CPO & PK (CCP/07-02-2013-AOM)

SOP- Mass Balance Calculation (SC-MBC-02/2013-AOM)

APUMA - The following policy, SOPs and guidelines are documented at the mill.

Polisi Keselamatan dan Kesihatan Kumpulan JC Chang

Asia Palm Oil Mill Safety (Machinery) Operation Procedure (23 Jan 2013)

JC Chang Group Safety and Health Manual (13 Feb 2007)

The Mill Safety Operation Procedure include procedures at Reception station, Grading station, Threshing Station, Pressing station, Clarification station, Depericarper, Nut and Kernel , Boiler, WTP, Loading Ramp, Steriliser station and Hoisting Station. In the pictorial SOP displayed on the notice board in the office as well at the appropriate stations in the mill and Bahasa Malaysia is used as a language of communication .

.

4.1.2 Records of monitoring and the actions taken are maintained and kept for a minimum of 12 months

Minor


Objective

evidence: Records of monitoring are available and documented.

In the mill and estate ( AOPE 2 ) the monitoring form is known as ‘ Pemantauan Prosedure Bekerja dengan selamat untuk ( operation ) ’

The estate monitors the major routine operation like Manuring, Tractor, workshop, Harvesting ,Loose fruit, rat baiting etc.

Records of the mill are kept based on the financial year 2013/2014 whereas the estate the record is kept for more than 12 months.

The mill also monitor other issues such :

• FFB input and CPO, PK and EFB output

• Energy generation by the boiler

• Water consumption, diesel usage

• POME land irrigation ( until it’s use for composting )


Submissions of monthly report to Jabatan Alam Sekitar (DOE) Negeri Sabah are evident. Reports submitted include information on:

• EFB disposal

• Effluent flow meter reading & weekly effluent sampling results

• Schedule waste inventory & stack emission sampling

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

4.2.1 Monitoring of fertilizer inputs through annual fertilizer recommendations Minor


Objective

evidence: Monitoring of fertilizer inputs is through the annual fertilizer recommendations and are available. Records are found in the Manuring Recommendation & Programme file for 2013/14

The annual fertilizer recommendations are provided by their agronomist Tan Ah Aia. The agronomist recent visit to AOPE2 was on 25/4/13 .

The report include:

a) Palm growth appearance

b) Ground conditions , drainage and roads

c) Pest and diseases

d) Pruning , frond Stacking and Harvesting

e) Compost / EFB application

f) Foliar and Soil Results

g) Fertilizer recommnendation and Delivery Schedule

For example in AOPE2, the following was recommended in the 2013/14 programme.

In Field F11 the following programme was recorded

Jul – Sep 2013 : NK Mix 3.0 kg

Sep – Nov 2013 P/Mg Mix 2 kg

Application is on time as during the audit application of P/Mg Mix was being applied in F11.

Application in the field was visited and was shown to be as per required by the management in terms of quantity ( 2 kg ( 2 bowls ) ) and supervision.

4.2.2 Evidence of periodic tissue and soil sampling to monitor changes in nutrient status Minor


Objective

evidence: There is evidence of periodic tissue and soil sampling to monitor changes in nutrient status. This is done annually.

Leaf and Soil are sampled on 16/5/13 – 21/5/13 and sent to the KDC Lab. The rsults of the analysis received on 5/7/13 are documented .

Parameters tested are Ash, N, P, K, Ca, Mg, B for foliar.

Soil parameters analysed are : pH, K, Ca, Mg, CEC, P, Org C, N.

In AOPE 2 estate , the results of the soil and foliar are filed in ‘Foliar & Soil sampling analysis’ file for the year 2013. Report No: R13/6/279, R13/6/212,

4.2.3 Monitor the area on which EFB, POME and zero-burn replanting is applied Minor



Objective

evidence: APU monitors the area on which EFB, POME are applied.

APU advocates zero-burning policy during replanting.

The Mill will place the EFB dumpsite at a designated area and the estate will arrange transport for the delivery of the naturally composted EFB to the estates.

The EFB transported will be weighed at the Mill’s weighbridge so that the Mill can monitor the amount dispatch to each estate.

All the EFB is used within the supply base estate. The estate will record the quantity applied at each field.

AOPE 2 records the total hectareage applied in each field using the tractor grabber. For e.g.on the 30/9/2013, in F94-Block F8 , 0.7 ha was apllied at a rate of 150 kg per palm. The records are kept in the EFB application file.

At present the composting plant is not commission yet .

The land irrigation is done in AOPE2. Records show that land irrigation is applied in field E06,E07, E08,E09,E12, E13 of a total hectareage of 110.34 ha.

From the mill flow meter, the estate will record the quantity discharge as land irrigation daily. For e.g on the 30/9/13 the amount applied is 520m

3

No EFB and POME are applied in ME2.

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

4.3.1 Documented evidence of practices minimizing soil erosion and degradation (including maps)

Minor


Objective

evidence: In AOPE 2 , documented evidence of practices minimizing soil erosion and degradation (including maps) is found in the ‘ Guideline on Soil & Water Conservation Doc C/002-01/2008’ and in C/005-01/2008 Guidelines on Managing steep areas planted with oil palms

Slope analysis calculation is available and documented in ‘ Doc Criterion 4.3 ( 1/1/2012 )’ available where it is stated that >25 degrees slopes are not planted.

Estate has standard operating procedures to minimise soil erosion and degradation.

Erosion control is evidence in the field . Terrace are cut on slopes , frond stacking is advocated.

Circle weeding is practiced to minimized bare and exposed soil and to ease operation like manuring and to facilitate harvesting.

Soft grasses and ferns like Nephrolepis sp are maintained in the field

Topography maps and slopes maps are available .

The Unit has SOP documents for erosion control known as “Guidelines on soil and water conservation”. Slope and soil maps are available. In HL3 the following were identified:

River floodplains : 23.22%

Moderate Hills 10°-20° : 29.7%

Very low Hills <15° : 5.6%

Low Hills, Minor flats <15: °

Fresh water swamp : 0.96%

Evidences of erosion control were observed through

a) terracing,

b) frond stacking,

c) setting up of silt traps

d) and planting of leguminous cover crops during replanting.

e) Circle weeding is practiced to minimized bare and exposed soil and to ease operation like


manuring and to facilitate harvesting.

f) EFB Mulching

g) Proper road grading and drainage activities

In mature areas, the policy is to maintain non-competitive “soft weeds” in the inter-rows to maintain ground cover. Based on the soil maps, there are no peat area. The ultrabasic soils were identified as fragile soil. These ultrabasic soils and rocky outcrop in HL3 and in ME2 have poor soil properties resulting in bare and expose condition. To avoid erosion, efforts have been made by the Unit to vegetate by planting ground covers around the area to protect the soil .

4.3.2 Avoid or minimize bare or exposed soil within estates Minor


Objective

evidence: Field visit shows evidences of erosion control were observed through terracing, frond stacking, setting up of ‘off-shoot ‘ and water diverter drains along the roads.

Herbicide spraying is done around the palms and the control of woodies.

The estates maintains soft grasses , ferns and avoids or minimize bare or exposed soil within estates

4.3.3 Presence of road maintenance programme Minor


Objective

evidence: In the AOPE 2 Budget ( FY 13/14 ) , road maintenance record and progress report is divided into :

a) Resurfacing, RM 50911

b) Grading, RM 37206

c) Potholes. RM22392

d) Road compacting RM 6681

e) Water diverter / Off shoot RM 11,915

The roads are regularly maintained , diversion of water runoff from the field roads are seen

4.3.4 Subsidence of peat soils should be minimized through an effective and documented water management programme

Minor


Objective

evidence: Based on the soil reports, there are no soils identified as peat.

Soil type at AOPE 2 :

a) Floodplains ( Alluvium ) 860 ha

b) Luangmanis & Rumidi (Mudstone & alluvium ) 1330 ha

c) Kretam (Mudstones,Sandstones, Misc Rocks) 830 ha

In field E16 although the palms were leaning, these area is not peat area as the soil map showed that this area is of Rumidi soil type.

Similarly soil reports of ME2 were verified that there are no soils classified as peat in the estates.

4.3.5 Best management practices should be in place for other fragile and problem soils (e.g. sandy, low organic matter and acid sulphate soils)

Minor


Objective

evidence:

No fragile and problem soils are identified in AOPE 2 .


Based on the soil maps, there are no peat area. The ultrabasic soils were identified as fragile soil. These ultrabasic soils and rocky outcrop in HL3 and in ME2 have poor soil properties resulting in bare and expose condition. To avoid erosion, efforts have been made by the Unit to vegetate by planting ground covers around the area to protect the soil .

They have advocated techniques such as

: Techniques that minimise soil erosion are well-known and should be adopted, wherever appropriate. These may include practices such as: 1. Expediting establishment of ground cover upon completion of land preparation for new replant. 2. Maximizing palm biomass retention/ recycling. 3. Maintaining good non-competitive ground covers in mature areas. 4. Encouraging the establishment/regeneration of non-competitive vegetation to avoid bare ground. 5. Construction of conservation terraces for slopes >15

o

6. Advocating proper frond heap stacking such as contour/L-shaped stacking. for straight line planting and stacking along the terrace edges for terrace planting. 7. Appropriate road design and regular maintenance. 8. Diversion of water runoff from the field roads into terraces or silt pits. 9. Construction of stop bunds to retain water within the terrace.

10. Maintaining and restoring riparian areas in order to minimize erosion of stream and river banks.

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

4.4.1 Protection of water courses and wetlands, including maintaining and restoring appropriate riparian buffer zones at or before replanting along all natural waterways within the estate.

Major


Objective

evidence: It was noted that natural water courses within the estates assessed are maintained, river buffer zone marked and restored. Example of marked buffer zone is found in AOPE 2 in F 91 A10 where natural forest species like raintree, Telisai Paya, Bingkur, Laran , Sepat and Topog etc are planted along the tributary stream of Sg. Tenegang Kecil

Along the watercourses, ‘No hunting and Fishing’ sign, Buffer zone signs and markings were observed.

Riparian reserves are mapped and protected with supplemental plantings of tree species to protect riverbanks and improve the habitat. These activities are covered under the Unit’s long term conservation budget planning.

The Guidelines on Establishment of Riparian Buffer zone ( C/001-02/2009 established in 16 Feb 2009 ) is maintained. AOPE 2 has a 5 year conservation plan on river riparian year 2013 to establish and restore the

areas designated as riparian in the map.

4.4.2 No construction of bunds/weirs/dams across the main rivers or waterways passing through an estate

Major


Objective

evidence: No evidence on construction of bunds/weirs/dams seen along the watercourses.

4.4.3 Outgoing water into main natural waterways should be monitored at a frequency that reflects the estates and mills current activities which may have negative impacts (Cross reference to 5.1 and 8.1)

Major


Objective

evidence: On 5

th Mar 2013, Asia Palm Oil Mill receive the DOE Licence 004831 for the period 1 July

2013 – 30 June 2014. The licence state that the maximum processing capacity is 80 TPH and the mode of effluent discharge is a) Land Irrigation (Pengairan Ladang) dan Kompos and for use in composting.


The oil mill monitors the disposal of POME to Land irrigation/Pengairan Ladang on a monthly basis. The oil mill analyse POME in the last disposal pond to ensure that the disposal is within the DOE permit of :

BOD <20mg/l

TSS/Pepejal <200 mg/l

Am-N <150 mg/l

Total N 200 mg/l

pH <9 >5

temp < 45°C

The mill complied with the regulation by their submission of the DOE report on a quarterly basis.

In the latest submission on 17/10/13, all the parameters are within the range of the licence.

Jul 2013 Aug 2013 Sept 2013

BOD <20 mg/l 19 14 16

TSS/Pepejal <200 mg/l

10 17 17

Am-N <150 mg/l

<1 <1 <1

Total N 200 mg/l

26 26 26

pH <9 >5

8.9 8.8 8.9

Temp < 45°C

26 26 26

The samples were analysed at SAMM accredited lab ( SAMM No. 094 ) , KDC Laboratory

Presently, 100 % of the POME is for land irrigation.

AOPE2 monitors the tributary stream of Sg Tenegang Kecil at its inlets ( in field 91 B5 and 92 D4 ) and its outlet ( 91 B12 ) annually. In 2013, the water was analysed in 8/5/13

Remarks

Inlet @ 91 B5 Slightly polluted ( WQI 79 )

Inlet @ 92 D4 Clean ( WQI 83 )

Outlet @ 91 B12 Slightly polluted ( WQI 79 )

4.4.4 Monitoring rainfall data for proper water management Minor


Objective

evidence: Rainfall monitored daily at oil mill and estates.


Site Yearly rainfall ( Jan- Dec 2012 )

No. of rain-days

Asia Palm Oil Mill 3,560.50 214

Asia Oil Palm Estate 2 3,042 209

Melewar Estate 2 3048 170

Hwa Li Estate 3 2,811 177

4.4.5 Monitoring of water usage in mills (tonnage water use/tone FFB processed) Minor


Objective

evidence: APOM water use in the oil mill is being monitored daily using flow-meter, then summarised monthly and eventually presented in a graph for the yearly trend.

The yearly trend for the last 3 years is ‘trended ‘ graphically .

The monthly information on the water used at the oil mill against FFB processed is shown below;

Month Crop processed ( FFB )

( MT )

Total usage( Mill Boiler & process )

M3/MT FFB

July 16,705.96 27,355 1.64

Aug 16,294.75 19,971 1.23

Sept 18,741.32 28,391 1.51

Water analysis is sampled and analysed by the estate instead of the mill that is treating the water. Record of the water analysis available.

An interpretation of the result to identify the quality is done ( water quality Index ) as recommended by the SOP for River water sampling procedure ( C/011-01/2010) .

Analysis done on the 2 rivers at the entrance, middle and exit of Sg Koyah and Tenegang.

Data available at the oil mill was verified.

4.4.6 Water drainage into protected areas is avoided wherever possible. Appropriate mitigating measures will be implemented following consultation with relevant stakeholders.

Minor


Objective

evidence:

There was no drainage into protected area as the surrounding areas comprised of oil palm estates either belongs to other plantation companies or smallholders.

4.4.7 Evidence of water management plans Minor


Objective

evidence:

APOM water management plan is available and known as ‘Mill Guideline- APOM –Water Management Plan 2013

It includes :

Completed projects 2013


Future plans of water usage

Efficient or wise water usage / practices

Monitoring of water use

Water Saving Campaign

Monitoring of water

Effluent monitoring is done under waste management

Besides the usage of water used in the Mill, the domestic water is also recorded.

Month Domestic water Usage m3

Jul 6,361

Aug 5,628

Sep 5,597

Record of the water analysis is available at both the estate and the oil mill .

The treated water is analysed yearly . The latest analysis for the mill treated water was analysed in Sept 2013. The result show that the water comply with the WHO Standard for domestic consumption.

The estate , AOPE2 will follow the SOP – Guidelines on Water Management Plan Sabah. C/004-01/2008

It includes the following topics:

a) Riparian Buffer zone

b) Demarcation of Wetland Area

c) Soil and water conservation area

d) No ocnstruciton of Bunds /Weirs/Dams

e) Monitoring of water

f) Monitoring of water consumption for household

Water for the Estate and linesite is sourced from the tributary of the Sg Tenegang Kecil . it will be pumped to a impounding pond / reservoir pond. The mill will then pump the water to its water treatment plant facility before pumping it back to the estate and linesite.

Water usage for the Estate is monitored .

Based on the records :

Total usage ( lit ) Total Resident lit/ person/day

Jul 5,294,800 505 338.22

Aug 4,517,300 516 282.4

Sep 3,459,000 518 222.59

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

4.5.1 Documented IPM system Minor


Objective

evidence: Documented guidelines procedure on IPM on rats, leaf-eating caterpillars, rhinoceros beetle and disease management like Ganoderma are in place.


Ref : Doc L/001-04/2012 : Guildelines on Intergrated pest & disease management of Oil Palm

.

The SOP / Guidelines include :

a) Definition , concept

b) Surveillance , Monitoring and Census

c) Calibration of chemical application

d) Biological control

e) IPM for leaf eating caterpillars, rhinoceros beetle, rats, Ganoderma

In AOPE2 , since the palms are mature, the active IPM programme are for the pest like rats, leaf eating caterpillar and Ganoderma.

4.5.2 Monitoring extent of IPM implementation for major pests Minor


Objective

evidence:

Monitoring extent of IPM implementation for major pests is done through regular census of pest incidence.

AOPE2 monitors the census by recording in the Pest Damage Census form.

AOPE 2 has records of the monitoring for rat and for leaf eating caterpillar.

For rats, through observation by the staff and workers on the harvested FFB, if the damage is high , census will be carried out immediately.

As per SOP, if the damage is more than5% fresh damage , baiting will be carried out like what happen on 10 Oct 2013 in 92 D10 and 92D11

For the leaf eating caterpillar, similar observation will be inspected during harvesting operation and if 5 live larvae is observed, census will be conducted to assess the severity.

Beneficial plants like Turnera spp, Cassia sp., Antigonium sp. and Euphorbia sp.are planted along the perimeter of blocks in the estates to encourage the population of predatory insects of leaf eating caterpillars.

4.5.3 Recording areas where pesticides have been used Minor


Objective

evidence: Areas where pesticide used are recorded in the ‘Stores Issue Chit /Note ’ when products are issued by the store clerk.

For example in AOPE 2 , for Store Note no: 079461, field 96 F4 , Ally 175g and Activaotr 750 ml were issued on 30/10/13.

The staff would record the pesticide used in the Estate Costing Sheet and the Weeding Progress Report file

The documents covers the date of spraying pesticides, field number, quantity of pesticide used, cost of chemical and labour used for the day. The said information is being recorded daily by the staff and assistant manager and verified by the manager.

4.5.4 Monitoring of pesticide usage units per hectare or per ton crop e.g. total quantity of active ingredients (a.i) used/tone of oil

Minor



Objective

evidence: In the estates, pesticide usage and type of chemical is monitored daily .

Monitoring of pesticide usage units per hectare or per ton FFB for AOPE 2 is found in the ‘Monitoring of Pesticide Usage per MT FFB

total kg a.i used per ha

AOPE 2

All pesticides

2012/13 0.419

2011/12

0.321

The estate normally waits for the OER from the mill to present the previous month’s chemical usage.

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

4.6.1 Written justification in Standard Operating Procedures (SOP) of all agrochemical use

Major


Objective

evidence:

In AOPE2 , the written justification available :

a) Weedicide : B/009-08/2012 ( doc date : 3/8/2012 )

b) Insecticide/fungicide/rodenticide : B/008-09/2012 ( Doc date 18/7/2012 )

4.6.2 Pesticides selected for use are those officially registered under the Pesticides Act 1974 (Act 149) and the relevant provision (Section 53); and in accordance with ESECHH Regulations (2000)

Major


Objective

evidence: AOPE 2 : Chemical used in the estate are officially registered products under the Pesticides Act 1974 (Act 149) and the relevant provision (Section 53); and in accordance with ESECHH

Regulations (2000) e.g.

a) Ally

b) Sentry Glyphosate

c) D- Amine 720

d) Decis 250

e) STORM

f) Activator

4.6.3 Pesticides shall be stored in accordance to the Occupational Safety and Health Act 1994 (Act 514) and Regulations and Orders and Pesticides Act 1974 (Act 149) and Regulations

Specific guidance:

Unless participating in established recycling programmes or with expressed

Major


permission from the authorities, triple rinsed containers shall be pierced to prevent misuse. Disposal or destruction of containers shall be in accordance with the Pesticide Act 1974 (Act 149) and Environmental Quality Act 1974 (Scheduled Wastes) Regulations 2005.


Objective

evidence: AOPE 2 , Pesticide are found to be stored with the necessary requirement in accordance to the Occupational Safety and Health Act 1994 (Act 514) and Regulations and Orders and Pesticides Act 1974 (Act 149) and Regulations;

a) Lights

b) Ventilation

c) Spill kit

d) Shelving and containment

e) Lock and key

f) MSDS

g) Hazard signboards

h) Appropriate PPE : mask, apron, gloves, goggles

Safety briefing before entering store and the provision of PPE was given before entering chemical store. All chemical are pre-mixed before sending to the field. All empty containers used for chemical premix are labelled ‘Racun’ ( Poison ) . Risk Assessment on impact on health and environment documented in O/001-05/2011,

4.6.4 All information regarding the chemicals and its usage, hazards, trade and generic names must be available in language understood by workers or explained carefully to them by a plantation management official at operating unit level

Major


Objective

evidence: All information regarding the chemicals and its usage, hazards, trade and generic names are available in both English as well as in Bahasa Malaysia , languages understood by workers and staff.

The MSDS was available at the chemical store visited in AOPE 2.

Spill kit, first aid boxes, hazard signs and emergency procedure were available at the estate chemical store.

4.6.5 Annual medical surveillance as per CHRA for plantation pesticide operators Major


Objective

evidence: The annual medical surveillance as per CHRA for plantation pesticide operators were checked .

At AOPE 2 annual medical reports of the following sprayer operators were checked by the Dr Rosdi Judda on March 2013

Checkroll Gang : R06

Ariah Musseng

Rosmawati Raja

Sumarni Juju

Aris Manneng

Checkroll Gang R05


Nurjannah Ramain

Herni Damang

Ramliah tola

Sumiati Ridwan

However it was found that Ms Sumiati Ridwan who went on long leave from March 2013 – May 2013 was not included in the annual surveillance.

Observation 01

4.6.6 No work with pesticides for confirmed pregnant and breast feeding women Major


Objective

evidence:

The spray operators pregnancy test record of the sprayers were shown to be negative.


Ariah Musseng

Rosmawati Raja

Sumarni Juju

Aris Manneng

Checkroll Gang R05

Nurjannah Ramain

Herni Damang

Ramliah tola

Sumiati Ridwan

4.6.7 Documentary evidence that use of chemical categorized as World Health Organization Type 1A or 1B, or listed by the Stockholm or Rotterdam Conventions and paraquat, is reduced and/or eliminated. Adoption of suitable economic alternative to paraquat as suggested by the EB pending outcome of the RSPO study on IWM

Minor


Objective

evidence:

Records showed that the last paraquat usage was on 19/10/2010.

4.6.8 Documented justification of any aerial application of agrochemicals. No aerial spraying unless approved by relevant authorities

Major


Objective

evidence: No aerial spraying

4.6.9 Evidence of chemical residues in CPO testing, as requested and conducted by the buyers

Minor


Objective

evidence: No buyers have requested for testing in 2013 hence there is no records of CPO testing of chemical residues.


4.6.10 Records of pesticides use (including active ingredients used, area treated, amount applied per hectare and number of applications) are maintained for either minimum of 5 years or starting November 2007

Minor


Objective

evidence: Viewed the annual documents of cost books and stock issues.

AOPE 2 : In the file document IPM system : Use of Pesticide it can be shown that records are kept since Nov 2007

The estate monitor the usage based on quarterly pesticide a.i gram usage per MT FFB since 2007 .

From the graph, it is found that the usage varies every quarterly depending on the damage incidence. In general, high damage , high usage. High rainfall normally result in higher usage .

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

4.7.1 Evidence of documented Occupational Safety Health (OSH) plan which is in compliance with OSH Act 1994 and Factory and Machinery Act 1967 (Act 139)

Major


Objective

evidence: Asia Production Unit has the following OSH procedures and guidelines:

• Safety and Health policy ( Polisi Keselamatan dan Kesihatan Kumpulan JC Chang) Updated 1st July 2012 ( in both language )

• Safety and Health Committee Organisation Chart

• Safety and health (OSH) plan

• Guidelines on health and safety instructions to contractors

• Guidelines on accident investigation procedure

• Guidelines on fire extinguisher selection, placement, use, maintenance, inspection and records/fire drills

Visitors like auditors, prior to a visit are briefed on safety, assembly area in case of evacuation and informed of the Asia Production Unit’s ‘Standard RSPO Principles for Visitors’ in the office.

In APOM, the risk assessment was conducted on the 24/8/2013 – OSHA Risk Assessment and the HIRARC( Hazard Identificaiton ) was conducted on the 25/8/13

In the HIRARC , the following are identified:

a) Hazard Identification

b) Risk Assessment rating ( Likely hood, Severe, Risk )

c) Risk control + PPE Required

d) Implementation & responsibilities

Hazard identification, risk assessment and risk control (HIRARC) on oil palm estate daily operation activity was conducted on 1/7/12 : Doc Ref : M/018-02/2011 . The following are the operation the risk was assessed:

a) Harvester

b) Weedicide


c) Manurer driver

d) Storekeeper

e) Foreman

f) General worker/ mandore

The following are some of the appointed Safety Officer/ Coordinator

Safety Officer appointed

Asia Palm Oil Mill Mr Samsi b Laipan ( appointed 4/6/2013 )

AOPE 2 Rudy Low

Safety and Health Plan is available specifying the company’s plan in implementing the occupational safety and health within the company’s operation. The plan (Doc. Ref. No. M/013-02/2011) dated 09 February 2011 is available to the audit team during the audit.

Risk Assessment for Melewar Estate dated July 2013 is available covering all operations within the estates. The risk assessment is found to be approved by the manager. In addition, risk assessment for Asia Oil Palm 2 Estate is also available. The risk assessment is found to be updated accordance with the accident occur during the validity of the assessment.

Safety and health policy dated 01 July 2012 and signed by the Plantation Director of the company is available that among others specifies the requirement of the company to comply with the requirement of the Occupational Safety and Health Act 1994.

Training plan for 2013 is available that also includes the requirement for Occupational Safety and Health Training that covering the first aid training, fire drill, safe operating procedures and daily briefing of PPE as well as the MSDS training.

Safety and Health Officer is identified and has been appointed for both Mill and Estates. Evidence of training is available together with the appointment letter that is signed by the respective managers

Safety and health committee meeting is conducted quarterly. Based on record the meeting has been conducted as follows for 2013:

Date Venue

28 January 2013 Melewar 2 Estate

15 March 2013 Melewar 2 Estate

25 June 2013 Melewar 2 Estate

18 September 2013 Melewar 2 Estate

19 January 2013 Asia Oil Palm 2 Estate

11 April 2013 Asia Oil Palm 2 Estate

31 July 2013 Asia Oil Palm 2 Estate

30 September 2013 Asia Oil Palm 2 Estate

29/9/13 Asia Oil Palm Mill




Emergency Response Procedures is also found to be established covering the following working areas:

Chemical spillage;

Fire occurrence;


Accident;

Flood occurrence.

Observed also the first aider is found to be trained. In general all first aider are found to be trained as follows:

21 October 2013, 23 September 2013 (Melewar Estate);

28 August 2013, 30 September 2013 (Asia Oil Palm 2 Estate);

Evidence of training in the form of training records and attendees is available during the audit.

4.7.2 Records should be kept of all accidents and periodically reviewed at quarterly intervals

Specific Guidance:

Record of safety performance is monitored through Lost Time Accident (LTA) rate.

Major

Findings In compliance: Yes: X No:

Objective

evidence:

Accident records are kept and periodically reviewed at quarterly intervals APU has the a SOP known as ‘Guidelines on accident investigation procedure’.M/015-02/2011

Records of accident investigation, JKKP 6 &7, JKKP 8 (I)/(IV) ( annual submission ) are available.

Accident records are found to be updated on a monthly basis (using JKKP 6 form) for both Mill and Estates. Observed also JKKP 8 is used for reporting the accident records at a yearly basis. Observed that latest submission was conducted as follows:

20 January 2013 – Melewar 2 Estate

25 January 2013 – Asia Oil Palm 2 Estate

For the Mill , as of to-date, there were no JKKP 7 submission which is for poisoning.

The APOM has a summary of the accidents since 2007. In 2013, there were 3 report of accidents and these have been recorded in the Mill AOM- accident Investigation report but since the medical leave for these accidents were less than 4 days , these do not need to be submitted using JKKP 6.

However some of the minor injuries were also recorded in the list but were not reported in the JKKP8.

Observation 02

4.7.3 Workers should be covered by accident insurance Major


Objective

evidence: Workers are covered under the London Pacific Insurance using the Foreign Worker Compensation Scheme. The company submit the list of workers monthly to the insurance company.

All Workers (both local and foreign) are found to be covered by the valid accident insurance.

Observed sample of insurance policy as follows:

Melewar 2 Estate –J/13/WF00/033912/JHR-51 with a validity period from 01 September 2013 to 31 August 2014;

Asia Oil Palm 2 Estate – J/13/WF00/033640/JHR-51 with a validity period from 01 August 2013 to 31 July 2014. In addition, AOP2 Estate also have subscribed an insurance policy for new worker. The insurance with a policy no. FW051511 covering validity period from 22 July 2013 to 21 July 2014 is available;


AOM: FWCS ( foreign workers compensation insurance ) policy no: J/13/WFOO/033249/JHR-54 for 93 foreign workers. For the period 1/7/13 – 30/6/14. In addition they are covered by the management , Foreign worker Hospitalization and surgical Insurance Scheme ( SKHPPA ) ( Skim Perlindungan insurans kesihatan Pekerja Asing ( SPIKA ) )

Local workers are also covered under the SOCSO scheme and evidence is shown through the deduction from their payslip and insurance documents.

APU - The local workers are covered by SOCSO while the foreign workers are covered by workmen compensation scheme. On top SOCSO, APU provide personal accident (PA) for their staff. For staff, the PA ranges from RM50,000 – RM 250,000 depending on the position of the staff.

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

4.8.1 A training programme (appropriate to the scale of the organization) that included regular assessment of training needs and documentation, including records of trading for employees are kept

Guidance:

Appropriate training should be given to all staff, workers and contractors by growers and millers to enable them to fulfill their jobs and responsibilities in accordance with documented procedures. All Estate Hospital Assistants (EHA) are trained on the chemicals used and related laws.

Major


Objective

evidence: The 2013/2014 training programme for Asia Production Unit that included regular assessment of training needs and documentation, including records of training for employees are kept was found at AOPE 2 and Asia Palm Oil Mill.

Attendance sheets are also kept

Individual records and files are also kept for each worker. For example new worker En ahmad abas who joined on 22/10/13 and employed for manuring had training for

a) PPE Training

b) Latihan Pembajaan .

Assessment/training evaluation is conducted after the training to gauge knowledge and understanding of the workers.

Interview has been conducted with mandore & workers. According to them, all workers have been trained on their specific job (SOP training). The safety reminder is given every morning during muster call.

Records of staff awareness and implementation training on RSPO were evidence in Asia POM and in the estates.

Training Date

Safety training – Weeding 8/2/12

Safety training – Manuring 28/9/11, 22/3/12

Safety training – drivers 28/9/11

Safety training – Harvesting 28/9/11

Safety training – first aid 20/3/12

Safety training – workshop 28/9/11

RSPO awareness 9/3/2012


Gangguan Seksual Wanita 5/4/12

Latihan SOP kepada Pengendali Sampah

4/4/12

Safety – Motorcycle 5/7/12

A training programme and plan for 2013, including records of training for employees are kept in the training file at each estate and mill. Example of trainings conducted are as follows:

Training Date

Manuring workers including mandores • 03 September 2013; 08 July 2013

Pre-mixing and Triple Rinse Procedures and theory training

• 26-27 May 2013; 20 May 2013

•

Safe Operation Procedures for Harvesting workers including mandores

• 19 August 2013; 14 January 2013

First Aid Training • 21 October 2013, 23 September 2013; 28 August 2013 and 30 September 2013

Fire Drill and Fire Extinguishing Procedures • 12 October 2013; 30 April 2013 and 23 July 2013

PPE usage • 27 June 2013; 21 January 2013

Safe Operating Procedures in Workshop • 05 February 2013; 19 October 2013

Tractor – safe Driving Skill • 19 October 2013

Safe Operating Procedures for Sprayers • 16 October 2013

Principle 5: Environmental Responsibility and Conservation of Natural Resources and Biodiversity

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

5.1.1 Documented aspects and impacts risk assessment that is periodically reviewed and updated

Major


Objective

evidence:

Wild Asia conducted an SEIA study on July 13, 2011 that documented the aspects of environmental impacts used by the estates to then compile a 5 Year Environmental Improvement Plans. The Environmental Improvement Plan is designed to mitigate negative impacts and to promote the positive ones.All areas require improvements are identified, correction actions are planned, and Actions carried out are reviewed annually. Reviewed result is utilized to generate next improvement plan.)

There are specific actions for both the mill and estates to take in regard to water quality, soil erosion and pollutions. The plans also consider the loss of biodiversity through loss of natural areas and means to enhance riparian reserves and other habitats.

5.1.2 Environmental improvement plan to mitigate the negative impacts and promote the positive ones, is developed, implemented and monitored

Guidance:

Non-restrictive format e.g. ISO 14001 EMS and/or EIA report incorporating elements spelt out in this criterion and raised through stakeholder consultation.

Minor



Objective

evidence:

Carotino / J C Chang Group has prepared the 5 Years Environmental Improvement Plan for Asia and Melewar Production Units -- Doc Ref. N/05-01/2013; 20 August 2013 that has specific actions for Mill and Estates. It identifies the impacts and threats on the following areas/aspects identified: 1. Water Quality and Water Availability;

1.1. Conservation of Water Resources; 1.2. Eutrophication of Aquatic Environments; 1.3. Soil Erosion and Loss of Productive Capacity;

2. Contamination of Soil and Water; 2.1. Waste Management and Landfills; 2.2. Pesticide Usage, Spillage and Containment

3. Air Pollution; 3.1. Dust and Particulate Emissions 3.2. Greenhouse Gas Emissions from Plantation Development and Mill Operations;

4. Loss of Biodiversity 4.1. Critical Natural Habitats and Forest Fragmentation

Improvement plans to mitigate negative impacts and promote positive ones are based on activities carried out in phases for 1, 3 and 5-year scenarios. The plan is subjected to an annual review to check on implementation progress with actions recorded in the Review Record Form upon assessment. The next review date is scheduled for August 2014.

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

5.2.1 Identification and assessment of HCV habitats and protected areas within land holdings and attempt assessments of HCV habitats and protected areas surrounding landholdings

Major


Objective

evidence:

The Wild Asia study has identified and assessed potential HCV habitats in each estate and environmental management plans (Doc Ref: c/019-01/2011 date 5-8-2011) are in place to serve as the overall plan for all estates. In addition, each estate has riparian reserves that are protected. There are no surrounding natural forest areas bordering the estates. The Wild Asia study in July 2011 also identified bird species of importance to the estates with a few endemic or threatened species noted. However, there are no real HCV habitats of major importance for ERT species. Of the 24 bird spp identified by Wild Asia with only one is endemic to Sabah, the white-crowned Sharma and one rare, the Chinese pond heron.

In Melewar 2, an area has been identified as HCV4 , an area that provide basic services of nature in critical situation eg water shed protection or erosion control. This area was found to be steep in nature and has ultrabasic soils which resulted in poor vegetation. The threat identified that the exposed surface on steep slope would result in high water runoff during the rainy season that may eventually cause erosion at the base of the slopes. ME2 Management Plan for this area was to make efforts to try to plant some leguminous cover crop around the area so that these covers will creep over the bare surface area to reduce impact of the rain.

5.2.2 Management plan for HCV habitats (including ERTs) and their conservation Major


Objective

evidence: HCV Management Plan in the form of document entitled HCV Identification and 5 Years Management Plan for Asia and Melewar Production Unit (Ref No. C019-03/2013) dated 10 August 2013 is available. In summary the document specifies the management plan for the identified HCVs as follows:

Ensure the physical boundaries are clearly marked and does not encroached in the HCV;

Constantly communicate with relevant regulatory authority on an inappropriate activities within the identified HCVs, in particular the Forestry Department;

Continuously conduct the awareness programme among the internal and external stakeholders especially the workers, local communities as well as the relevant government agencies;

To enforce the protection of the identified HCVs with a collaboration of the state government;


To continue implement the in-estate programme of establishing and enhancing the riparian buffer zone as per guided in the Guidelines on Establishment of Riparian Zone;

To discourage hunting and fishing activities in the estates and mills by posting signboard on prohibition of hunting and fishing at all identified HCV areas and do not allow any hunters to enter the estate areas;

Continue to monitor estates and daily activities to check for any occurrence of pollution especially in identified HCV area, if any; and

To carry-out the restoration of riparian areas to improve the capacity of soil to attenuate agrochemicals in soil water as well as to trap sediment in surface run-off.

5.2.3 Evidence of a commitment to discourage any illegal or inappropriate hunting, fishing or collecting activities and developing responsible measures to resolve human-wildlife conflicts

Specific Guidance: Identify ERTs and establish their conservation status based on national and state conservation schedules; and should provide evidence of attempts to do likewise for immediate adjacent areas. In the event that the conservation status of a species has not been assessed locally, the IUCN list should be used to determine and report conservation status. Management plans to include areas for improvement.

Where appropriate, the above activities to be conducted involving relevant stakeholders

Minor


Objective

evidence:

Hunting is prohibited in all plantation areas and there are sufficient signboards to dissuade this activity. In some water catchment areas ‘No fishing ‘signs are also found.

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

5.3.1 Documented identification of all waste products and sources of pollution Major


Objective

evidence: In Asia Palm Oil Mill, waste products and sources of pollution in the estate and oil mill activities were identified and documented in Doc Ref F/007-01/2011 Waste and Waste Products identification and disposal Plan for Estate and Mill

In includes identification of sites as well as waste the site produces:

Office

Dispensary

Store

Workshop

Laboratory

Generator Room

Estate Operation waste

Mill processing waste ( effluent, mesocarp, fibre& shell ) , EFB, Boiler ash, used security seal, discarded cages)

Canteen/shop and housing compound

Waste management plan is available as per in the Wastes and Waste Products Identification and Disposal Plan for Estates and Mill (Ref. No.: F/007-02/2012) dated 28 April 2012. In summary the document identified the wastes as follows:

1. Office Waste; 2. Dispensary – Clinical Waste;


3. Store Waste; a. Fertilizer Bag; b. Chemical Container; c. Empty oil container; d. Empty lubricants container

4. Workshop; a. Used lubricants and oils; b. Used oil filers; c. Used batteries; d. Used tyres and rubbers

5. Generator Room 6. Water Treatment Plant 7. Laboratory – used chemicals 8. Estate Operation Wastes;

a. Pruned Oil Palm Fronds b. Buffallo Dung c. Oil Palm trunks from replanting d. Used poly bags and water piping from nursery

9. Mill Processing Wastes a. Effluent b. Mesocarp Fibre and Kernel Shell c. EFB d. Boiler Ash

5.3.2 Having identified wastes and pollutants, an operational plan should be developed and implemented to avoid or reduce pollution

Specific Guidance: Schedule waste to be disposed as per EQA 1974 (Scheduled Wastes) Regulations, 2005. Reference to be made to the national programme on recycling of used HDPE pesticide containers.

Municipal waste disposal as per local authority or district council in accordance to the Ministry of Health guidelines (i.e. specifications on landfills, licensed contractors, etc) or Workers’ Minimum Standards of Housing and Amenities Act 1990 (Act 446).

Minor


Objective

evidence:

Observed that an operational plan for each of the identified waste source is found to be established and implemented.

Scheduled waste is found to be disposed according to the Environmental Quality (Disposal of Scheduled Waste) Regulations, 2005. Based on records, latest disposal has been made as follows:

All waste identified as scheduled waste is disposed to a scheduled waste collector Cahajasa Sdn Bhd a licensed Scheduled Waste collector (Licence No: 000729) via Melewar 1 Estate. Observed that the latest records of disposal for 2013 is as follows:

o 08 October 2013 – used engine oil SW305-4 totalling to 4 drums – 800 litre

o 14 October 2013 – used batter (17 pcs), chemical container 20 pcs (Sentry container)

Empty container on 18 October 2013 to the empty chemical container collector i.e. Dynason Sdn. Bhd. covering the following:

o Gallon Container = 93 pcs; and

o Ally Bottle = 151 pcs.

Used oil/lubricants on 22 August 2013 to the local vendors i.e. Ken Loong Tyres covering the following:

o Used batteries = 22 pcs

With regard to the recycling of waste, the audit team observed that the company has taken proactive action to implement the recycling process. Observed that all recyclable waste is segregated at the estate office and be disposed through the appointed collected. Observed latest disposal of recyclable waste has been conducted on 21 October 2013 covering used papers with a total quantity of 100kg.


5.3.3 Evidence that crop residues/biomass are recycled (Cross reference C 4.2)

Specific Guidance: POME should be discharged in compliance with the Environmental Quality Act 1974 (Act 127) and Regulations.

For Sabah and Sarawak, POME should be discharged according to the respective state policies.

Minor


Objective

evidence: Field evidence shows that the crop residues were returned to field. E.g. pruned fronds are piled well in inter-rows and subsequently returned to soil. Biomass like shell and fibre are used as renewal energy for the oil mill.

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

5.4.1 Monitoring of renewable energy use per ton of CPO or palm product in the mill Minor


Objective

evidence: Evidence of monitoring of renewable energy use per tonne of CPO or palm product in the mill is available. The mill has monitored the usage of fibre and shell as feedstock to the boiler to the turbine to generate electricity and recorded on Monthly basis.

From the record ‘ Monitoring of fibre & Shell use per tonne of CPO ‘ the following information is recorded: 2013/2014

Month FFB ( MT ) CPO (MT) Total shell produced and used /CPO

( 4.76% )

Total fibre produced and used/ CPO

( 13.15% )

Jul 16,705 3,850 0.21 0.57

Aug 16,295 3,356 0.23 0.64

Sep 18,741 3,862 0.23 0.64

5.4.2 Monitoring of direct fossil fuel use per ton of CPO or kW per ton palm product in the mill (of FFB where the growers has no mill)

Guidance:

To establish baseline values and observe trends within appropriate time-frame. Growers and millers should assess the energy use including fuel and electricity, and energy efficiency of their operations. The feasibility of collecting and using biogas, biodiesel and biofuels should be studied if possible.

Minor


Objective

evidence: Monitoring of direct fossil fuel use per ton of CPO or kW per ton palm product in the mill are also recorded

Month FFB ( MT ) CPO (MT) Diesel ( lit ) Diesel / CPO kWh

Jul 16,705 3,850 42,367 11.01 503,703

Aug 16,295 3,356 34,076 10.15 467,192

Sep 18,741 3,862 28,906 7.48 519,696

The mill will assessed the trend yearly and will placed a ‘remark ‘ footnote to explain the usage/ trend. For example in the FY 2012/13 it was noted that the higher diesel consumption compared to 2011/12 was due to lower FFB processed


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

5.5.1 No evidence of open burning. Where controlled burning occurs, it is as prescribed by the Environmental Quality (Declared Activities) (Open Burning) Order 2003

Major


Objective

evidence: APU advocates zero-burning policy during cultivation or replanting

5.5.2 Previous crop should be felled/mowed down, chipped/shredded, windrowed or pulverized/ploughed and mulched

Minor


Objective

evidence: The previous crop is felled , chipped and place between the planting rows to decompose.

5.5.3 No evidence of burning waste (including domestic waste) Minor


Objective

evidence: Visit to estates line site confirmed no evidence of burning of domestic waste. In addition, the company also has placed a signboard at linesite to warn workers of ‘No open burning’ allowed at the line site.

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

5.6.1 Documented plans to mitigate all polluting activities (Cross reference C 5.1) Major


Objective

evidence: Plans to mitigate all polluting activities are documented in their ‘ Pollution Mitigation Plans’ for the Mill and Estates ,

In the Pollution Mitigation Plans for the Mill, Doc Ref No: F/013-04/2013 , it tabulates :

a) Mill Area

b) Identification of the Pollutant

c) Type of Waste

d) Way of pollutant

e) Quantification

f) Legal requirement

g) Severity Point / ranking of risk

h) Preventive/Action/Plan

i) Date action plan and reviewed

j) Further Action after review ( yearly ) Latest reviewed done 12/6/2013

For the treatment of POME, the effluent goes through a series of ponds ( 6 Ponds ) consisting of 2 Cooling , 2 Anaerobic Ponds, 1 Aerobic Ponds and 1 settling pond respectively.

The line joins and goes to the ETP before discharging to land irrigation.

Eventually, part of the POME will be used in the compost plant.

(Ref. No.: F/009-04/2013) revised on 25 July 2013. In summary the document specifies the mitigation measures for the following identified wastes:


1. Diesel;

a. Diesel Storage Area;

b. Diesel Dispensing Pump

2. Workshop;

a. Vehicles repair and maintenances;

b. Parts washing area;

c. Workshop and washing ramps;

3. Generator house;

a. Generator set;

b. Diesel dispensing tank

4. Vehicles – stationary or moving vehicles

5. Store

a. Pesticides

b. Chemical wastes

c. fertilizer

6. Housing Waste

a. septic tank

b. domestic waste

7. Planting areas, rivers and field drains

8. Waste

a. EFB collection site

b. Landfill site

c. Recycling

9. GHG Emissions – overall operations

10. Compost application and fields

11. Land irrigation system for treated effluent.

Activities that contribute to the mitigation of polluting activities from waste management at the mill and estates has been implemented according to the above plan that includes attenuating concentrated mill wastes- EFB, fibre, shell and ash, by distribution to the field, recycling of waste materials – metals, plastics, etc.

5.6.2 Plans are reviewed annually Minor


Objective

evidence: The plans are reviewed annually. 20/9/11, 22/6/12 and 12/06/13

As described above, the Pollution mitigation plan is available as per in the Pollution Mitigation Plan for Estates and Mill (Ref. No.: F/009-04/2013) has been annually with latest revision on 25 July 2013.

5.6.3 Monitor and reduce peat subsidence rate through water table management (Within ranges specified in C 4.3)

Minor


Objective

evidence: There is no peat identified in APU

No peat soils are identified in Melewar2, HL3 and AOPE2.


Principle 6: Responsible Consideration of Employees and of Individuals and Communities by Growers

and Millers

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

6.1.1 A documented social impact assessment including records of meetings Major


Objective

evidence: A Social Impact Assessment has been carried out by the consultant Wild Asia ( Malaysia ) Sdn Bhd. observed that the assessment dated 13 July 2011 is available to the audit team during the Surveillance Audit.

Observed also that the assessment has been conducted with a participation of stakeholders. Records of consultation with stakeholder is found attached together in the assessment.

. The impacts that has been highlighted are as follows:

Occupational safety;

Workers health;

Workers working condition;

Safety and health of women workers;

Workers wages;

Term of employment;

Workers living condition;

Labour contract; and

Other issues.

6.1.2 Evidence that the assessment has been done with the participation of affected parties

Minor


Objective

evidence: All records of meetings, consultation takes place during the SEIA are incorporated in the assessment document.

As reflected earlier the assessment has been conducted with a participation of stakeholders. Records of consultation with stakeholder dated 04 and 12 April 2011 are found attached together in the assessment

6.1.3 A timetable with the responsibilities for mitigation and monitoring is reviewed and updated as necessary

Minor


Objective

evidence: Timetable with responsibilities for mitigation and monitoring of social aspects as stipulated in the estates and mill social management plans is available as per in the Asia and Melewar Production Unit 5 Years Social Improvement Plan. The document (Ref. No. N/006-03/2013) dated 18 August 2013 available specifies the aspects and impacts identified as well as the action to be done and person in-charge.

Key aspects identified in the above document are as follows:

Traffic and transportation safety

Job opportunities

Pay and decent living wages

Employment conditions

Living conditions


Health & safety in the workplace

Public health & safety

Communication with management

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

6.2.1 Documented consultation and communication procedures Major


Objective

evidence: There is a Standard Operating Procedures (SOP) on Mechanisms for Communication and

Consultation established for the purpose of conducting the consultation with employees and other stakeholders. The document E/004-02/2010 dated 05 October 2010 specifies the following identified mechanism for communication and consultation:

Joint Consultative Committee (JCC) be established covering the following items;

Objectives of the committee;

Membership of the JCC Meeting;

Selection of Committee Representatives from Workers;

Frequency of the Meeting i.e. once every three months;

Agenda of the Meeting; and

Action to be taken on matters discussed.

Complaints and Grievance Procedures:

The document E/001-01/2008 dated 01 October 2008 has been established as a means to channel communication and consultation for the workers; other internal as well as external stakeholders to resolve any issues raised

Suggestion box:

To be used as another means for communicating and consulting with workers as well as other external stakeholders;

The Manager has been appointed as the designated person to open the box once every week to ensure the confidentiality of the correspondence. The correspondence also shall be filed separated from other correspondence.

Nominating the officer for handling the communication and consultation;

Manager is the designated person as the main contact person responsible for any issues pertaining to communication and consultation.

In addition, the above document also specifies the mechanism for Gender Group Consultation covering the following elements:

Membership of the committee:

Selection of committee members and representatives from female workers;

The company gives full liberty to the workers to elect their own representatives. All appointed committee members are found to have been officially appointed through evidence of appointment letter

Frequency of the meeting i.e. at least two times a year;

Agenda of the meeting; and

Action to be taken following matters discussed.

Documented consultation and communication procedures is available as per in the document SOP on Mechanisms for Communication and Consultation (Ref No. E/004-03/2013) dated 07 February 2013. In summary the procedures specifies the following sections:

Mechanism 1 – joint consultative Committee (JCC)

Mechanism 2 – Complaint and Grievance Procedures

Mechanism 3 – Suggestion Box


Nominated Officer Responsible for Communication and Consultation

Announcement Channel of Communication and Consultation

Mechanism 4 – Gender Group Consultation

6.2.2 A nominated plantation management official at the operating unit responsible for these issues

Minor


Objective

evidence: As reflected in the SOP on Mechanisms for Communication and Consultation (Ref No. E/004-03/2013) dated 07 February 2013, manager has been identified as the responsible person for all issues regard on communication and consultation. In addition, the assistant manager is also

appointed as the alternate personnel in case the manager is not around..

In practice, Mr. Seow Chee Chiang (Estate Department Manager (Admin. / Sustainability)) handles all social issues for Asia Plantation Unit when manager fail to solve the issues within timeframe given.

There is also the Joint Consultative Committee (JCC) – members are responsible to handle any issues at the estate level.

6.2.3 Maintenance of a list of stakeholders, records of all communication and records of actions taken in response to input from stakeholders

Minor


Objective

evidence: APOM has records of stakeholder’s request as well as the actions. No issues on pricing.

List of stakeholders are available in all estates and mill. The list comprises;

1. Statutory Bodies

2. Inter Estates & Mills

3. Neighbouring Estates

4. Suppliers of Materials & services

5. Local Community

6. Local NGO’s

A list of stakeholders is available, listing all government agencies, non- governmental organizations, village representatives and employees.

Records of communication with stakeholders and actions taken are maintained and made available. Based on records, the latest Meeting with stakeholders has been conducted on 03 September 2013 and 24 September 2013 participated by 14 and 7 members respectively representing the local communities and the estate management.

During the surveillance audit, Stakeholder Request Book records are viewed request and grievances are recorded and updated on September 2013.

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

6.3.1 Documentation of the process by which a dispute was resolved and the outcome Major


Objective

evidence: The Unit maintains a complaints and grievance procedure that is specified in its SOP documentation, (E/001-02/2010). A complaint flow chart was available.

The Complaints and Grievances Register file records information of complaint/grievances, details of complainants, details of recipients’ action taken, and date informed complainants

6.3.2 The system resolves disputes in an effective, timely and appropriate manner Minor


Objective

evidence: During the surveillance audit, Complaints and Grievances Register are viewed request and

grievances are recorded since 2009 until March 2012. There are no new grievances raised since


then. Based on records, the auditing team observed that generally the follow-up action has been taken within 20-25 working days from the day the complaint received as per in the procedures.

Estate Date Issues Person In-

Charge

Date

resolve

Melewar 2 21 Feb 2012 Reporting against Mandore

Manager 01 March 2012

Asia Oil Palm 2 13 April 2013 Reporting against Security Gate Officer

Assistant Manager

19 April 2013

In addition, JCC for the company is continuously being implemented. Based on record, for 2013, the company has conducted the following JCC meetings:

Venue Date remarks

Melewar 2 Estate 14 January 2013;

15 March 2013;

25 June 2013;

18 September 2013

22 members out of 06 is workers rep




Asia Oil Palm Estate

19 January 2013;

11 April 2013;

31 July 2013;

30 Sept 2013





The minutes of the Meetings mentioned above is maintained and made available to the auditing team during the surveillance audit.

6.3.3 The system is open to any affected parties Minor


Objective

evidence:

Communication to the affected parties is evidenced. For instance, any internal social issues is communicated through either Gender Committee (for women issues) or during briefing during daily Muster Call or during the Safety and Health Briefing.

The above system is found to be open to affected parties. Based on records, the briefing of the above system has been conducted to the internal stakeholders i.e. workers and mandores on 15 October 2013. Evidence of briefing in the form of attendance list and signature/finger-print stamp is available during the audit.

With regard to the external issues, the issues are communicated during the meeting with external stakeholders conducted between the estates/mill and the relevant stakeholders.

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

6.4.1 Establishment of a procedure for identifying legal and customary rights and a procedure for identifying people entitled to compensation

Major


Objective

evidence: SOP for Identifying Legal and Customary Rights and Identifying People Entitled to Compensation (E/002-01/2008) is available dated 1 Oct 2008.

The SOP included the following elements:

Procedure for Identifying Legal and Customary Rights:


Procedure for Calculating and Distributing Fair Compensation: and

Procedure for Identifying Legal and Customary Rights and Identifying People Entitled to Compensation is available (Doc. Ref: RSPO Criterion 6.4 – Ver. 1, dated 1 Oct 2008) is documented. There were no indigenous communities within or surrounding the plantations.

6.4.2 A procedure for calculating and distributing fair compensation (monetary or otherwise) is established and implemented. This takes into account gender differences in the power to claim rights, ownership and access to land; and long-established communities; differences in ethnic groups’ proof of legal versus communal ownership of land.

Minor


Objective

evidence: The Unit has a SOP for Identifying Legal and Customary Rights and Identifying People Entitled to Compensation that include identification procedure, calculating and distributing fair compensation procedure and documentation on outcome of compensation

6.4.3 The process and outcome of any compensation claims is documented and made publicly available

Minor


Objective

evidence: This Unit do not have any customary rights issues with the local communities

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

6.5.1 Documented of pay and conditions Major


Objective

evidence: The mill and estates maintains the pay slips of all employees. Copies of the slops are provided for the employees and staff.

Based on the pay slip, the average income is RM 1,200 for general workers (sprayers, manurers and linesweepers) and RM 1,750 (harvesters) that is above industry minimum wages requirement regulated by the government whereby for East Malaysia where the minimum wage regulated is RM800. In addition, random interview with the workers as well as the union representative confirmed that the salary is paid on time.

Random verification observed that the payslip specifies the following:

the employee reference no.;

I/C or Passport no.;

Public Holiday Pay;

Productivity Allowance;

basic/daily wages;

total days works;

deduction for EPF, SOCSO etc; and

checkroll advance.

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) are available in the language understood by the workers or explained carefully to them by a plantation management official in the operating unit

Minor


Objective

evidence: Details of term and conditions of employment are described in their offer letter. For the mill the Guidelines on term & conditions of Employment for Sabah Mill’s Workers is available. For the estate, Guidelines on Terms & Conditions of Employment for Sabah Estate’s Workers (E/009-03/2013) dated 08 February 2013.


In Melewar Estate as well as the Mill, the employee contract agreement is available in Bahasa Malaysia. The employment contract contains:

- Period of Contract ( Tempoh Perjanjian)

- Position ( Jawatan Pekerja)

- Duties and Responsibilities of Employee ( Tugas dan Tanggungjawab Pekerja)

- Basic pay and allowances ( Gaji dan Elaun Pekerja)

- Working hours and Overtime ( Masa Kerja dan Ketentuan Lebih Masa)

- Employee Public Holiday ( Hari Cuti Am Pekerja)

- Annual leave ( Cuti Tahunan Pekerja)

- Insurance ( Insuran Pekerja)

- Medication/ Hospitalisation and Health Screening Checkup (Perubatan dan Fomema)

-- Repatriation guidelines (Penghantaran Pulang Pekerja ke Negara Asal)

- Emergency leave ( Cuti Kecemasan )

- Contract Renewal and Termination (Penamatan Kontrak)

Employee Personel record of the employee has been reviewed. Observed that the Estate has established the “Perjanjian Pekerjaan” (Employment Agreement) effectively implemented on 01 Aug 2011. Random employment agreement verified during the surveillance audit are as follows:

Work Field Name Date Join

Harvester Nasrullah Hakim 01 July 2011 (renewal date 01 July 2013)

Harvester Samsul Salim 21 August 2011 (renewal date 01 July 2013)

Sprayer Aisyah Usman 01 July 2011 (renewal date 01 July 2013)

Sprayer Sumarni Juju 21 August 2011 (renewal date 01 July 2013)

Manuring Irfan Sapo 21 August 2011 (renewal date 01 July 2013)

6.5.3 Growers and millers provide adequate housing, water supplies, medical, educational and welfare amenities in accordance with Workers’ Minimum Standard of Housing and Amenities Act 1990 (Act 446) or above, where no such public facilities are available or accessible (not applicable to smallholders)

Minor


Objective

evidence:

All employees are given adequate housing ( concerte with sound roofing ), medical, educational and welfare amenities and waste disposal facilities in accordance with Workers’ Minimum Standard of Housing and Amenities Act.

Workers have access to clean water, segregated sanitary and bathing facilities and electricity

Disposal of domestic solid wastes at the linesite is conducted at least twice a week. In addition, the company also encouraged and promotes on the segregation and recycling of domestic wastes at the line sites and work places.

Medical facilities and services are provided. Education at primary level is supported for children from the estate as well as the surrounding area.

Social, cultural and recreational activities and places of worship are supported.

Public health services provided in housing areas. Physical amenities are provided, effectively operated and maintained to a standard equivalent to an urban authority.

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


6.6.1 Documented minutes of meetings with main trade unions or workers representatives

Major


Objective

evidence: Documented minutes of meetings with main trade unions or workers representatives are available.

JCC for the company is continuously being implemented. Based on record, for 2013, the company has conducted the following JCC meetings:

Venue Date remarks

Asia POM 30/9/13

28/6/13

12/3/13

20/12/12

17 + 6 ( Mngt )

19 + 6 ( Mngt )

21 + 4 ( Mngt )

19 + 4 ( Mngt )

Melewar 2 Estate 14 January 2013;

15 March 2013;

25 June 2013;

18 September 2013





Asia Oil Palm Estate

19 January 2013;

11 April 2013;

31 July 2013;

30 Sept 2013





The minutes of the Meetings mentioned above is maintained and made available to the auditing team during the surveillance audit.

6.6.2 A published statement in local languages recognizing freedom of association Minor


Objective

evidence:

The company does not provide restriction for Malaysian workers to form workers union.

In all estates and mill, a published statement in local language recognising freedom of association was placed on the notice board of the management office. The statement reads “Pekerja-pekerja bebas untuk mengikut atau menyertai mana-mana agensi berdaftar di bawah undang-undang Malaysia. Kenyataan ini adalah sebagai tambahan kepada kontrak pekerja yang sedia ada. Daripada Pihak Pengurusan”.

Freedom of Association Policy dated September 2009 is documented and circular freedom of association for workers posted on the notice board. Bahasa Malaysia version is also available.

It was evidence that the company does not provide any restriction for workers to form workers union however evidence showed there are no unions in the estates and mill.

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

6.7.1 Documented evidence that minimum age requirement is met Major


Objective

evidence: APU comply both to the Malaysian Labour Ordinance and the Sabah CAP.67 Labour Ordinance concerning the employment of workers.

The company has the copy of the policy posted on notice board in the offices of the estates and mill that Carotino/J C Chang does not employ persons under 16 years old. Personal information of workers showed that all workers are above 16 years old. There is no evidence of use of children employed both in the mill or estate operations. Employment record show that the minimum age of


employee is 20 years old.

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

6.8.1 A publicly available equal opportunities policy Major


Objective

evidence: There is a social policy stating that the company provide equal opportunity for all i.e. Equal Opportunity Policy (Polisi Kesamaan Peluang) dated 01 July 2012 is available. The policy is available and pasted on the notice board for public viewing at the entrance of the oil mill. There were no evidences of any form of discrimination based on race, national origin, religion, gender, union and political affiliation and is covered in the policy as well.

In addition, Sexual Harassment Policy dated 01 July 2012 together with SOP on mechanism for the prevention and eradication of sexual harassment and violence in the workplace are also available.

6.8.2 Evidence that employees and groups including migrant workers have not been discriminated against

Minor


Objective

evidence: Interviews with workers (local and foreigner) indicate that there was no such discrimination occurs in the workplace. In addition, the auditing team note that the company is currently implementing the equal opportunities for workers through the following:

Training is given to the workers on a yearly basis covering training relating to their working station, personnel training such as communication skills and safety and health training;

All employees are covered with working insurance; and

Termination is conducted based on local laws and is stated in the workers employment agreement.

similar daily wages for foreign workers and local workers.

working hours where similar treatment is given between both the foreign and local workers.

On basic amenities whereby both foreign and local workers received similar facilities.

Well representation of JCC Meeting between both foreign and local workers

Well representation of Gender Committee meeting between foreign and local workers

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

6.9.1 A policy on sexual harassment and violence and records of implementation Major


Objective

evidence: Sexual Harassment Policy is available and

Sexual Harassment Policy dated 01 July 2012 together with SOP on mechanism for the

prevention and eradication of sexual harassment and violence in the workplace are displayed on the office notice board . The policy was also written in the local language and displayed on the notice boards at the line site and at the muster ground.

No evidence or practices that contradict this policy were observed.

Discussion with female staff shows that the company provide fair and just treatment to women.

In addition there is a Gender committee and a nominated gender representative established at each estates and mill.

Records of Gender committee meeting are available .

Gender Representative for the Mill : Pn Hajijah Lahak , Lab Asstant.


Interview with the chairwoman, Pn Hajijah Lahak confirm that there has been no reports of harassment for 2012/13.

In addition there is a gender committee and a nominated gender representative established at all estates and mill. Based on records, the meeting conducted since last Annual Surveillance Audit for visiting estates are as follows:

Estates Date

Melewar 2 26 June 2013;

Next meeting to be convened on December 2013

Asia Oil Palm 2 27 February 2013;

28 August 2013

Asia Palm Oil Mill 25/8/13 (12 + 2 ( Mngt ))

20/2/13 (12 + 2( Mngt ))

17/8/12 (5 + 2 ( Mngt ))

6.9.2 A specific grievance mechanism is established Minor


Objective

evidence: A SOP on “Mechanism for the Prevention and Eradication of Sexual Harassment and Violence in the Work Place” is also in place. The SOP E/003-01/2008 dated 01 October 2008 includes the following mechanisms and procedures:

preventing sexual harassment in workplace,

rationale,

Definition of sexual harassment,

forms of sexual harassment,

strategies to prevent sexual harassment,

o Clear sexual harassment policy,

o monitoring the work place on a regular basis,

o To consider highly on all complaints,

o guidelines for handling complaints on sexual harassment

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

6.10.1 Pricing mechanisms for FFB and inputs/services shall be documented Major


Objective

evidence: Asia Production Unit has established Fresh fruit bunches Sales and Purchase Agreement as the mechanism on FFB pricing.

FFB Price = { ( A-B ) x C } + { ( D- E ) x F } - G

The Sales and Purchase Agreement contains information :

Seller and Buyer identification

1.0 Quantity

2.0 Delivery

3.0 Quality

4.0 Weights

5.0 FFB Price Calculation

6.0 Payment

7.0 Insurance


8.0 Legislations/Rules/Guidelines/Schemes

9.0 Force Majeure

10.0 Warranty

11.0 Notice

12.0 Duration

Current and past prices paid for FFB has been made for available at the mill.

Copies of Sales and Purchase Agreement signed by both the supplier and the buyer is made available for verification during audit

The agreement is explained by representative from APU . Once they accept the agreement, and when they find the APU contract to be fair , the supplier will sign the documents as a proof of acknowledgment. There are other mills around the area and suppliers are free to decide where to send their crop.

A call was made to Smart Foremost and according to the c.c. Ms Nur, they have no issue with AOM and payment is received 2 times per month normally 10 days after the announcement by MPOB.

6.10.2 Current and past prices paid for FFB shall be publicly available Minor


Objective

evidence: Asia Palm Oil Mill will post the current prices based on MPOB website daily at the weighbridge station for the public to view.

In addition according to APOM , smallholders can contact the mill to be informed of the latest FFB price

6.10.3 Evidence that all parties understand the contractual agreements they enter into and that contracts are fair, legal and transparent

Minor

Findings In compliance: Yes: No: x

Objective

evidence: The contract documents (Fresh Fruit Bunches (FFB) Sales and Purchase Agreement) pertaining the term and condition between AOM and smallholders is written both in English and in Bahasa Malaysia

The payment date/period to smallholder shall be accordance the statement stipulated in the para 6 in the Agreement.

6.10.4 Agreed payments shall be made in a timely manner Minor


Objective

evidence: As per contract, payment is made in a timely manner 10 days after the announcement of the MPOB price announcement. .

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

6.11.1 Demonstrable contributions to local development that are based on the results of consultation with local communities

Minor


Objective

evidence: The individual estates and the mill have a very basic form of corporate social responsibility (CSR), which usually involves stakeholders, especially the local communities and workers. In general, the following events and contributions has been rendered by the company:

religious celebrations;

Opportunities for employment for local communities;


family day,

estate school children education aid

blood donation;

medical check-up for malaria and filiarisis diseases; and

sports day.

All activities and contribution rendered are recorded for each of the financial year.

In addition, there is also evidence that the contribution is made according to the request by the local communities. For instance, application by local communities from Kampung Koyah B to obtain gravel for road construction on 18 July 2013. The company has responded by approving the application dated 20 July 2013.

Evidence of communication and discussion with the stakeholder is also recorded that is recorded by the administration clerk and approved by the manager of estate.

Principle 7: Responsible Development of New Plantings

This whole Principle is not applicable to this assessment as there are no new plantings. The company is only involved in re-planting programme after felling of old palms and there is no plan for expansion.

Principle 8: Commitment to Continuous Improvement in Key Areas of Activity

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

8.1.1 Minimize use of certain pesticides (C 4.6) Major


Objective

evidence: Evidence of use of certain pesticides is minimise. Chemical use is monitored . Paraquat is not used.

Since May 2009, there is no evidence that the company is using chemical listed under Type 1A or 1B by WHO. Monitoring of chemical used is continued to be documented. In addition the company also has made commitment as follows:

reduce Circle Spraying round from 3 rounds to 2.5. rounds;

replace CDA Spray pumps with inter-pump spray pumps to reduce spray drifts and size of palm circles;

As part of the Carotino / J C Chang Group Group, Asia Production Unit monitors the performance of its mill as well as the estates through their crop and mill records as well as their regular visits by their mill and plantation advisers.

8.1.2 Environmental impacts (C 5.1) Major


Objective

evidence: Evidence of commitment to minimize environmental impacts.

Estates and mill has an Environmental IImprovement Plan that contains activities done to minimize the environmental impact . This is reviewed annually

On environmental impact, the company has listed the following activities as part of its CIs:

Integrated Pest management System – to continually monitor and control pests in the estate

Soil Erosion Management – improvement on roads and bridges. Other plan, provided repairing terraces and platform to control soil erosion. Continue to stack and restack all fronds in the flood prone areas

Continue to monitor the protection of bufferzone.


Use of POME for composting

8.1.3 Maximizing recycling and minimizing waste or by-products generation Major


Objective

evidence: Evidence of maximizing recycling and minimizing waste or by-products generation.

Waste management Plans ( doc ref no. F/001-02/2009) dated 05 Jul 2009 contains procedures, methods, plans and guideline to guide for current waste handling and it shall be reviewed from time to time to improve the waste management process.

The reduce, reuse and recycle programme has been implemented with the reminder to workers at regular period to encourage the use of the recycling bins for their disposal of domestic waste.

Maximizing recycling and minimizing waste or by-products generation is implemented through the following:

Waste Management – replace all Metal Waste Bin (converted from oil drums) with 125 units trash bin and stands to all quarters. In addition 3 sets Recycle bins are also provided

8.1.4 Pollution prevention plans (C 5.6) Major


Objective

evidence: Improvement for pollution prevention plan is conducted by the following:

roofing and flooring of the workshop will be replaced and repaired respectively. Provision provided for maintaining POL store, Chemical store and spillage straps

8.1.5 Social impacts (C 6.1) Major


Objective

evidence: Continuous Improvement for Social are as follows:

Staff Accommodation – 1 block x 2 units (Junior Executive Staff Accommodation) for 2 staff members who are sharing houses with others

Workers Accommodation – 1 block x 4 units (Other Workers Accommodation) for workers with families who are sharing houses

Wooden house – upgrade current wooden quarters to Child Nursery caretakers quarters

Gatekeeper House – replace dilapidated unit at main gate

Surau – supply 1 unit of septic tank for accommodating toilet facility

Drains – to construct 82 meter 1’x1’x1’ concrete drain to improve drainage system of the staff quarters and 353 meters of 1’x1’x1’ as well as 509 meters of 2’x2’x2’ concrete drains at linesite to improve drainage and hygiene.

Water services – purchasing of 1 unit backwash water pump and 2 units chemical dozer pumps for water improvement

Furniture fitting

8.1.6 A mechanism to capture the performance and expenditure in social and environmental aspects

Minor


Objective

evidence: Asia Production Unit captures the performance and expenditure in social and environmental aspects through their budget which is reviewed and adjusted annually to cope with changes in requirement.

Expenditure Summary on Employees Social Welfare FY 11/12

- Medical

- Welfare -Staff

- Staff Reimbursement


- Medical Labour

- Welfare Labour

- Recruitment

- Sundries

Expenditure Summary on Environment FY11/12 - Waste management Labour

Some of the Improvement Plan for 2012/13 are:

RM

Additional 130 units Water tanks for the Labour Lines : 84,500

1 set of Water filtration Plant 40,000

5 units tractors 370,000

3 Unit 5/6 ton trailers 36,000

1 Unit FFB crane 68,000

Replace old furniture of staff homes 15,000

Grill for Office windows for added security 4,500

Computer battery back up/ surge protector 1,400

Estate Road and bridges 769,500

Segregation waste Store 8,000

Compost Application 680,000

Total 2.076 Million

For the Estate , the following was allocated:

Expenditure relating to social and environmental aspects is well described in Expenditure Summary in Social and Environmental Aspects for FY 2013/2014 covering the following areas:

Contribution to social and communities welfare – RM 450

Environment conservation – RM 18,691

Waste Management – RM 33,956

Riparian Conservation – RM 7,800

Soil & Water Conservation – RM 114,901

3.1.2 Supply Chain Module E used by the mill

For supply chain, the Carotino / JC Chang Group – Asia Production Unit, Asia Palm Oil Mill has

decided to use Module E in this assessment since it receives crop from neighbouring smallholders.

The findings and objective evidence during the assessment are outlined in the table below. The

results for each indicator from each of the operational areas were evaluated to provide an assessment

of conformity. A statement is provided for each of the RSPO indicators in order to support the findings

of the assessment team.

Module E: Mass Balance

Module E.1: Documented Procedures


Criterion E.1.1: The facility shall have written procedures and/or work instructions to ensure the implementation of all the elements specified in these requirements.

E.1.1.1 Complete and up to date procedures covering the implementation of all the elements in these requirements


Objective

evidence: Procedures and work instruction are established and implemented to ensure the implementation of the RSPO supply chain system.

The following Standard Operation Procedure are complete to cover the implementation of all elements in the Supply Chain requirements :







SOP- Despatch (CCP/07-02-2013-AOM)

Asia Palm Oil Mill has established and maintains the following records:

- Weighbridge (WB) tickets ( FFB, PK and CPO)

- CPO & PK Dispatch Log book

- Training Plan & Training records

- Mass balance table

- Annual Summary of FFB received and CPO delivered

E.1.1.2 The name of the person having overall responsibility for and authority over the implementation of these requirements and compliance with all applicable requirements

Verifiers and guidance:

This person shall be able to demonstrate awareness of the facilities procedures for the implementation of this standard.


Objective

evidence: Mr. Henry Chong Chung Wai , Mill Manager has been appointed as the personnel having overall responsibility for RSPO SCC implementation.

The position has been showed in the organization chart.

Criterion E.1.2: The facility shall have documented procedures for receiving and processing certified and non-certified FFBs.


Objective

evidence: Procedure for receiving and processing of certified and non-certified FFB has been described under the following SOP documents:







SOP- Despatch CPO & PK (CCP/07-02-2013-AOM)


SOP- Mass Balance Calculation (SC-MBC-02/2013-AOM)

The SOP-Reception Station (CCP/01-02-2013-AOM ) is the procedure used to receive the certified and non-certified crop.

The crop is not processed separately, however a mass balance table is use to monitor the crop processed , CPO produces and PK etc.

Module E.2: Purchasing and Goods In

Criterion E.2.1: The facility shall verify and document the volumes of certified and non-certified FFBs received.


Objective

evidence: Asia Palm Oil Mill will purchase certified and non-certified FFB from suppliers . The Mill will use the mass balance system for handling and producing of certified CPO.

The declassification/downgrading can only be done in the following order :

Mass Balance>Non RSPO Certified Palm Oil Products

Asia Palm Oil Mill has established and maintains the following records:


- CPO Dispatch Log book



Annual Summary of FFB received and CPO delivered

Criterion E.2.2: The facility shall inform the CB immediately if there is a projected overproduction.


Objective

evidence: In the appointment letter of the Sustainability Operation Manager, dated 12/1/13, one of his responsibilities is to inform the CB immediately if there is a projected overproduction.

Module E.3: Record Keeping

Criterion E.3.1: The facility shall maintain accurate, complete, up-to-date and accessible records and reports covering all aspects of these requirements.


Objective

evidence: Asia Palm Oil Mill has established and maintains the following records:


- CPO Dispatch Log book


- Daily Production Figure ( sourced form the Company computer system known as Lintramax )


- Annual Summary of FFB received and CPO delivered

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


Objective

evidence: The SOP document , SOP- Mass Balance Calculation (SC-MBC-02/2013-AOM), established by the Mill clearly stated the retention times for all records and reports shall be at least five (5) years.

Criterion E.3.3

a) The facility shall record and balance all receipts of RSPO certified FFB and deliveries of RSPO


certified CPO, PKO and palm kernel meal on a three-monthly basis.


Objective

evidence: Asia Palm Oil Mill received FFB certified FFB from estates under Carotino’s group.

All certified FFB received are recorded in “Daily Mill Production Record” updated on daily basis.

The mass balance on a three-month basis is available : AOP Sustainability Products ( CPO ) Records

Criterion E.3.3

b) All volumes of palm oil and palm kernel oil that are delivered are deducted from the material accounting system according to conversion ratios stated by RSPO.


Objective

evidence: Asia Palm Oil Mill understood on the requirement to ensure internal material accounting complies with the Criterion E3.3 above where volumes of palm oil and palm kernel oil that are delivered are deducted from the material accounting system according to conversion ratios stated by RSPO.

Asia Palm Oil Mill will report the actual CPO and Palm kernel produced during the processing operation. This can be seen in the Daily Production Figure report.

Criterion E.3.3

c) The facility can only deliver Mass Balance sales from a positive stock. However, a facility is allowed to sell short.


Objective

evidence: Asia Palm Oil Mill will only deliver Mass Balance sales from a positive stock

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


Objective

evidence: No sales of certified RSPO SC products yet.

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


Objective

evidence: The Mill does not outsource any activities to the subcontractor. The palm kernel is sold to refinery LDEO.

Module E.4: Sales and Good Out

Criterion E.4.1: The facility shall ensure that all sales invoices issued for RSPO certified products delivered include the following information:

a) The name and address of the buyer

b) The date on which the invoice was issued

c) A description of the product, including the applicable supply chain model (Segregated)

d) The quantity of the products delivered

e) Reference to related transport documentation


Objective

evidence: The delivery procedure in the SOP ,SOP- Despatch CPO & PK (CCP/07-02-2013-AOM), clearly indicate that the list of information as per requirement above.

a) The name and address of the buyer

b) The date on which the DN was issued


c) A description of the product, including the applicable supply chain model (Mass Balance ) RSPO Certificate No. & CPO/MB or PK/MB

d) The quantity of the products delivered

e) Contract Number

(e.g. RSPO certificate no. and supply chain model) to be stated in the RSPO products delivery document (invoices) as required by the standard

Module E.5: Training

Criterion E.5.1: The facility shall provide the training for all the staff as required to implement the requirements of the Supply Chain Certification System.


Objective

evidence: Observed that Asia Palm Oil Mill has conducted training related to the implementation of the Supply Chain system.

Training ( Critical control Point )

Month No. of attendees

Weigbridge 22/9/13 7

Grading 25/7/13 6

Extraction 19/7/13 5

Clarification 14/6/13 4

Nut & Kernel 17/5/13 4

Lab 12/4/13 7

Despatch 22/9/12 4

Module E.6: Claims

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


Objective

evidence: No usage of RSPO trademark license yet.

3.2 Corrective Action Request

There are total of 0 Major and 0 Minor were raised. Please refer to the Appendix A for the

details findings and relevant correction actions have been taken.

3.3 Noteworthy Positive & Negative Observation

There were 02 Observations raised.

3.4 Status of Non-Conformities Previously Identified

This is a ASA 01 certification audit

3.5 Issues Raised by Stakeholders and Findings


A list of stakeholders contacted is included as Appendix C. Stakeholders did not provide any

comments in writing regarding the Carotino /JC Chang Group – Asia Production Unit

environmental and social performance. All interviewed stakeholders had positive comments

about Carotino / JC Chang Group – Asia Production Unit

4. ACKNOWLEDGEMENT OF ORGANIZATION INTERNAL RESPONSIBILITY

4.1 Date of Next Surveillance Visit

The next surveillance audit is planned within a year after the approval of this report.

4.2 Date of Closing Non-Conformities

Reference Class Issued Close

Minor 01

Minor 10/10/11 28/10/13

Minor 02 Minor 10/10/11 28/10/13

Minor 03 Minor 10/10/11 28/10/13

Minor 04 Minor 10/10/11 28/10/13

OBSERVATIONS

Reference Class Issued Close

Observation

01

Observation 10/10/11 28/10/13

Observation

02

Observation 10/10/11 -

Observation

03

Observation 10/10/11 28/10/13

4.3 Acknowledgement of Internal Responsibility and Formal Sign-off Assessment Findings

SGS Malaysia acknowledges and confirms acceptance of the Report contents and including the

assessment findings. SGS Malaysia accepts the responsibility for addressing the opportunities

of improvement detailed in this report.

Signed on behalf of Carotino / JC Chang

Group – Asia Production Unit

Signed on behalf of SGS Malaysia Sdn

Bhd


Name: Seow Chee Chiang

Designation: Estate Department Manager

(Admin. / Sustainability) Date : 13/12/13


APPENDIX A: CORRECTIVE ACTION REQUEST & OBSERVATION

There were no CAR raised during the surveillance ASA 01

CAR # Indicator CAR Detail

Date

Recorded>

Due

Date>

Date

Closed>

Non-Conformance:

Objective Evidence:

Close-out evidence:

OBSERVATIONS

OBS # Indicator Observation Detail

Obser

vation

01

4.6.5

Date

Recorded> 29/10/13

Due

Date> -

Date

Closed> 2 /11/13

Non-Conformance:

Annual medical surveillance as per CHRA for plantation pesticide operators was not

conducted

Objective Evidence:

The annual medical surveillance as per CHRA for plantation pesticide operators were checked.

At AOPE 2 annual medical reports of the following sprayer operators were checked by the Dr Rosdi Judda on March 2013


Ariah Musseng

Rosmawati Raja

Sumarni Juju

Aris Manneng

Checkroll Gang R05

Nurjannah Ramain

Herni Damang

Ramliah tola

Sumiati Ridwan

However it was found that Ms Sumiati Ridwan who went on long leave from March 2013 – May 2013 was not included in the annual surveillance.

Observation 01

Close-out evidence:



Asia Production Unit submitted evidence from the Klinik RuslanAmin stating that Sumi

Ridwan has been admitted today for her annual occupational medical surveillance on

1/11/13

Observation 01 - Closed

Obser

vation

02

4.7.2 Date

Recorded> 29/10/13

Due

Date> -

Date

Closed> 30/1013

Non-Conformance:

Records of all accidents were not keep in proper order and periodically reviewed at quarterly intervals

Objective Evidence:

However some of the minor injuries were also recorded in the list but were not reported in the JKKP8.

Observation 02

Close-out evidence:

On the 30th October 2013, Asia Palm oil mill submitted evidence of the minor injuries

are now reported as per requirement and the records of the accidents and injury file

are amended to ensure proper recording.

Observation 02 - Closed


APPENDIX B: NON-CONFORMITIES PREVIOUSLY IDENTIFIED


01 4.2.1

Date

Recorded>

10 Oct

2011

Due

Date> Next Surv

Date

Closed> 28/10/13

Non-Conformance:

Monitoring of fertilizer inputs through annual fertilizer recommendations was not done properly

Objective Evidence:

Melewar Estate 2 - workers were applying fertiliser inconsistent quantity due to lack of

supervision.

Close-out evidence:

Evidence submitted to show that Mandore will be supervising to ensure the workers

carry out the correct fertilizer application

Minor CAR 01 – Closed

02 4.5.2 Date

Recorded> 10/10/11

Due

Date> Next surv

Date

Closed> 28/10/13

Non-Conformance:

Monitoring extent of IPM implementation for major pests was improperly carried out

Objective Evidence:

Monitoring records to determine effectiveness of rat baiting program not accurately

represented in data forms. (i.e. pest damage census)

Close-out evidence:

Rat attack census on FFB will be carried out to determine the severity of the attack.

Rat baiting will be carried out if more than 5% fresh rat attack on FFB. After that,

rat bait uptake census will be carried out to determine the effectiveness of rat baiting.

Pest census form will be used to monitor damage and will be checked by staff.


03 5.3.2

Date

Recorded> 10/10/11

Due

Date> Next surv

Date

Closed> 28/10/13

Non-Conformance:

Waste is not reduced, recycled, re-used and disposed off in an environmentally and

socially responsible manner

Objective Evidence:

Mill : Scheduled Waste products ( Oil drums ) found in the Scrap iron heap.

Mill : Agrochemical containers reused as lubricant oil container without marking.

ME2 : Motor Oil leaking from parked farm tractors

HL3 : Empty agrochemical container found at the backyard of the line site

Close-out evidence:



Evidence submitted that :

a) Empty lubricant drums are placed at schedule waste store and later it will be disposed

in a responsible manner

b) Empty chemical containers will be triple rinsed. After triple rinsed and

perforated, empty chemical are sold to the recycle collector. We do not practice

reuse of empty chemical containers

c) Only black colour container which is standard colour is used to store/ transfer. Petrol,

Diesel and Lubricant for our routine needs

d) Tray is placed beneath the tractor that park at the parking bay to avoid any spillage

from the engine. Driver check for any leakage on a tractor early morning before start

driving

e) All quarters are provided with rubbish bins to replace used empty drums


Minor

04

6.2.3 Date

Recorded> 10/10/11

Due

Date> Next surv

Date

Closed> 28/10/13

Non-Conformance:

Although maintenance of a list of stakeholders is available, however records of all

communication and records of actions taken in response to input from stakeholders was not

available. Some records of communication with stakeholders especially with the photo

evidence did not include documented evidence.

Objective Evidence:

Lack of proper communication records with external stakeholders ( evidences of meeting

and consultation only based on photos and survey ) 6.2.3

Close-out evidence:

Meeting with stakeholders were carried out to get feedback from them.

The meeting minutes is prepared as shown as evidence that now meetings are

documented..


Obser

vation

01

4.7.1

Date

Recorded> 10/10/11

Due

Date> -

Date

Closed> 28/10/13

Non-Conformance:

Safe working practices were lacking

Objective Evidence:

Motor fan belt at the Water Treatment Plant are running without cover

Faulty electrical switch at Humana School ( HL3)

Evidences of smoking at the non-smoking area ( i.e cigarette butts)

- Water Treatment Plant ( Mill)

- Diesel Pumping Station ( HL3 Division 02 office)

Close-out evidence:



Monthly inspection is carried out to ensure that all electrical switches and

water supply are in order besides attending to complains

The drivers are briefed about non-smoking zone by estate assistant and assessment

will be carried out to ensure they understood. Workplace inspection is carry out

monthly to ensure the workers abide to all safety signage

Obser

vation

02

6.5.1 Date

Recorded> 10/10/11

Due

Date> -

Date

Closed>

Non-Conformance:

Discrepancies in documentation of recyclable material payment to workers

Objective Evidence:

Payments not reconciled for purchase of recyclable materials by the estate ( HL3)

Panjilareas owed RM455.00 for 910 kg of ‘besi ( scrap iron )’

Adi owed RM9.50 for 4 kg ‘besi (scrap iron )’ and 3 kg tin

Close-out evidence:

Observation Detail

Obser

vation

03

6.11.1

Date

Recorded> 10/10/11

Due

Date> -

Date

Closed> 28/10/13

Non-Conformance:

Demonstrable contributions to local development were not based on the results of

consultation with local communities

Objective Evidence:

Contributions to local development need to be based on the results of consultation with local communities.

Close-out evidence:

The worker requested for plank, zinc and metal structure for their son’s wedding

function which Estate allowed


APPENDIX C: TIMEBOUND PLAN

Melewar Production Unit is awaiting RSPO approval.

The Takon Production Unit is the last Unit to be certified under Carotino/ JC Chang Group.

The Takon Palm Oil Mill and its FFB supplying plantations under the JC Chang group will be seeking for RSPO

certification in April 2016. The Takon Production Unit comprises of 1 palm oil mill and 4 oil palm plantations

located in the State of Sabah, Malaysia


APPENDIX D: LIST OF STAKEHOLDERS CONTACTED

The following was reported during the Melewar Production Unit audit that has some connection

with the Asia Production Unit .

A month prior to the audit, a public announcement was placed on the RSPO website to allow

the public to voice their views on the unit to be audited.

Although the following issue is not related to the Unit, Mr Seow of Carotino / JC Chang took the

matter seriously and undertook an investigation on the root cause.

Item Issue

‘Complain’ On July 22, 2012, SGS ( Malaysia) Sdn Bhd , RSPO programme manager, En

Haye Semail received an email titled : A compliant lodge on a crocodile being

hunted at Asia Palm Oil Mill (Aduan tentang memburu Buaya disungai kilang

Asia Palm Oil Mill )

It reported that an Assistant has hunted down and killed 2 crocodiles as the

complainant saw 2 skins at the house of the Assistant and that the Unit did not

want to jeopardise their RSPO certification so it was not reported.

The complainant requested the auditors to investigate as the evidence is still

present in the Unit vicinity.

Findings

The issue was brought to the attention of Mr Seow of Carotino/ JC Chang and a domestic Enquiry was conducted and an investigation ensued. During the audit, this issue was brought up and it was informed that :

a) The wrongdoer was in fact a relative of the Assistant who brought the product into the Estate ( for drying )

b) The Assistant was suspended for 14 days during the official enquiry c) A warning letter was served and the salary was 50% deducted during the 14

days because the Assistant did not reject his relative’s request for drying a crocodile skin in the estate that complies with RSPO practices.

d) The Crocodile skin was confiscated and buried into a designated field in Asia Oil Palm Estate 2 with witness by Mr. Chang Khai Kok, The Estate Manager of Asia Oil Palm Estate 2.

List of stakeholders interviewed during the assessment

Date Location Stakeholders Issues

28/10/13

Interview –

a) Smallholder Smart Foremost chief clerk

Nur,

b) Gender chairwoman Halijah,

c) Accident worker Burhan,

d) Ramp mandor Zamri

a) Satisfied with Crop payment by the Palm Oil Mill. No issue. No delay. Follows guideline.

b) Gender committee - No issues and women are represented

c) Accident recorded and accident was attended to by HA before recommendation for further treatment at hospital

d) Pleased with management , housing , pay, etc.

29/10/13

Estates workers. – female sprayers, female manurers, mandors, harvester-Syamsul

HA

Issues on pay date, work hours, worker representative, complaint procedure, housing were discussed. No major issues as the workers seemed satisfied with how the management treats them. HA satisfied with the level of safety accorded by management.


Management provide sufficient fund for medical supplies.