Serious questions arise about FGV associate’s supply chains

(foresthints.news) - PT Synergy Oil Nusantara (PT SON), a joint venture company of Felda Global Ventures (FGV), has reaffirmed that as an associate of the Malaysian palm oil giant, it is fully committed to FGV’s sustainability policy with regard to NDPE (No Deforestation, No Peat and No Exploitation) and is guided by the Roundtable on Sustainable Palm Oil (RSPO) in its vendor approval process.

This formed part of a written clarification provided by PT SON to foresthints.news (Sep 8) in response to a news report on this site (Sep 5) revealing that FGV’s updated sustainability policy does not extend to the joint venture companies in which FGV does not have a controlling stake.

However, this statement from the palm oil refinery company stands in stark contrast to the written response received by foresthints.news (Sep 5) from FGV’s Vice President/Head of Sustainability and Environment Ida Suryati Binti Ab. Rahim, asserting that “PT SON is not our subsidiary and we don't have management control (over it) . Therefore it is not bound by FGV's GSP (Group Sustainability Policy).”

When asked for an explanation regarding these two apparently conflicting statements on Monday (Sep 11), PT SON said that it would respond by Friday (Sep 15). Nevertheless, as of Friday, no response from the FGV associate had been forthcoming. 

Links to controversial suppliers

PT SON also sought to clarify its relationship with two suppliers - Duta Palma and PT Austindo Nusantara Jaya Tbk (ANJT) - both of which have been described as “highly contentious growers” by Eric Wakker, a top executive at environmental consultancy firm AidEnvironment.

PT SON’s association with controversial palm oil company ANJT, as one of its largest buyers of palm oil, casts its true commitment to sustainability into doubt. 

ANJT has been proven to be engaged in the clearing of High Carbon Stock (HCS) forests in Papua, as exemplified in the images below. In fact, the supply chains of several major palm oil companies were previously linked to these operations, but most of them have subsequently cut their supply chains with ANJT.

PT SON’s written clarification acknowledged that it does indeed source palm oil from ANJA, a Sumatra based subsidiary of ANJT which is RSPO approved (as listed on the RSPO website). The palm oil refinery company added that its supply contract with ANJT comes to an end in December this year.

Probing further, foresthints.news asked PT SON whether in the event that ANJT continues clearing the HCS forests in its Papua concessions until December this year, it would still keep sourcing CPO from ANJT. 

This question relates to supply chain issues, and does not concern the locations of the mills where CPO is sourced. Disappointingly, however, this question also met with no response from PT SON.

The two Google Earth images below show examples of the HCS forests located among ANJT’s palm oil concessions in Papua which have been targeted for clearing to develop palm oil plantations.

As to Duta Palma, Eric pointed to PT SON's supply chain certification report (Sep 8). "PT SON bought palm oil from no fewer than 15 different Duta Palma subsidiaries. This is public information. If PT SON has now already excluded the company from their supply base, then kudos to them."

He went on to emphasize that PT SON is in fact one of the few refineries that operates without an NDPE policy, thereby offering a huge opportunity for leakage to rogue palm oil producers.

Not finished there, Eric also provided a recent example of the business-as-usual operations of Tabung Haji Plantations, one of PT SON's shareholders, to back up his assertion regarding PT SON's ties with "other controversial suppliers”.

“Tabung Haji Plantations has a subsidiary in North Kalimantan which has continued to clear peat forest until very recently. PT SON will have to do better if it wants to convince the market that it is a responsible refiner. Step one: let it publish a full and updated supplier list, like most refiners already do.”

PT SON, in addition to not responding to requests for further clarification from foresthints.news, failed to address any of the claims and assertions made by Eric by the promised date of September 15.

NDPE policy uncertainty

PT SON’s initial written clarification declared the following: “PT SON would like to advise that, as part of its pledge to ensure CPO purchased and processed in PT SON is derived from areas where there is NDPE, PT SON has taken the initiative and sought the cooperation of all its CPO suppliers to provide a declaration of equal stance”.

However, when asked whether PT SON has adopted an NDPE policy (in light of the above declaration), and if so whether this policy could be shared with foresthints.news, once again no feedback was received from the palm oil refiner.