http://www.thejakartaglobe.com/home/sinar-mas-censured-over-audit/397810


Sinar Mas Censured Over Audit
September 24, 2010

 Land owned by Indonesian palm oil giant Smart is cleared in Ketapang, West 
Kalimantan, in August. The Roundtable on Sustainable Palm Oil publicly slammed 
Smart on Thursday in response to an August audit that found the company had 
violated Indonesian forestry laws. (Reuters Photo) 





















An industry association for sustainable palm oil publicly censured a member for 
the first time on Thursday, saying Indonesia's Sinar Mas Agro Resources & 
Technology breached the group's principles and may face sanctions as a result. 

The Roundtable on Sustainable Palm Oil - an industry body of planters, green 
groups and consumers - announced on its Web site that its grievance panel had 
written to Smart and its parent company, Golden Agri-Resources, censuring the 
firms for breaches uncovered last month by an audit of Smart. 

Smart is a member of the RSPO; Golden Agri is not. 

The audit, conducted after Greenpeace alleged that Smart had bulldozed 
high-conservation -value forests and damaged carbon-rich peatlands, gave the 
palm-oil producer a mixed report card, highlighting some instances in which it 
violated Indonesia's environmental laws. 

The RSPO's comments may be a blow to Smart's efforts to win back big palm-oil 
buyers including Burger King, Nestle and Unilever, who have said they would 
stop buying from Smart because of environmental concerns. 

"In its letter to Smart and GAR, the panel finds there has been serious 
non-compliance with the RSPO code of conduct, specifically a failure by Smart 
to work towards implementation and certification of the RSPO principles and 
criteria," the organization said. 

In particular, the firms had infringed upon RSPO principles on social and 
environmental impact assessments and peatland management, it said. 

In a response to the statement, Smart said it would work toward meeting the 
requirements set by the RSPO, including making environmental-impact assessments 
and deep peatland conservation efforts. 

"We take the feedback of our stakeholders very seriously and this applies to 
the concerns of the RSPO, whom we are in touch with," Dauh Dharsono, president 
director of Smart, said on Thursday. 

"In the case of community engagement and social impacts, Smart believes in 
treating local landowners and communities fairly and will be commissioning a 
separate research to study its social impact on the community." 

With regards to peat conservation, the palm oil giant said it had "taken the 
necessary remedial actions including reinstating the land and moving forward, 
[and] it will be working with stakeholders on the overall management of peat 
including those areas that have been developed." 

But Smart's apologetic stance might not be enough for the RSPO, which 
announced: "Members who have been found to not be in compliance and who 
continue to be in non-compliance with the RSPO regulations could ultimately 
face sanctions, including the suspension and, eventually, the termination, of 
their membership." 

The RSPO also urged GAR to stop publicly suggesting it was in the process of 
obtaining RSPO certification. 

"GAR is not a member of the RSPO, nor has the RSPO yet received a membership 
application from the company. The panel encourages GAR to submit a full and 
complete application for membership," the statement said. 

Smart said it had written to the RSPO on Sept. 6 to seek advice on a membership 
application for parent company GAR. 

Greenpeace welcomed the RSPO's condemnation of Smart, saying the group should 
follow up on its reprimand by expelling the palm oil producer within four weeks 
if it did not take action. 

"Greenpeace is calling on other companies, like Cargill, to follow Unilever, 
Nestle and Kraft in canceling its palm oil contracts with Sinar Mas until it 
stops destroying rainforest and carbon rich peatlands," Greenpeace activist 
Bustar Maitar said. 

Enormous amounts of climate-warming gases are released when deep peatlands are 
disturbed, and the deforestation of Indonesia's extensive tropical forests led 
the World Bank to name the country the world's third-worst emitter in a report 
issued in 2007. 
 

Reuters 

[Non-text portions of this message have been removed]



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