About Palm Oil

Some Information from our Palm Oil Supplier....WILMAR INTERNATIONAL

CSR and Sustainability

Oil Palm is an important and versatile material for both food and non-food industries, which contributes to the economic development of the producing countries and to the diest of millions of people around the world.

Although palm oil is entirely GM-Free and has the highest yield per hectare of any oil or seed crop, it has been recognised that there are environmental pressures on its expansion to eco-sensitive areas, particularly as palm oil can only be cultivated in tropical areas of Asia, Africa and South America. It is vital that the production and use of palm oil must be done in a sustainable manner based on economic, social and environmental viability. We firmly believe that the future long term success of the group is dependent upon the integration of our commitment to sustainability into our core business activities.

High Conservation Value Forests or Primary/Virgin Rainforest (HCVF)

HCVF is defined as forests of outstanding and critical importance due to their high environmental, bio-diversity or landscape value (as defined by the FSC - Forest Stewardship Council). For all proposed developments or expansion as per the RSPO criteria which was proposed in November 2005, we will assess the area to determine if HCVF exists. If the study reveals HCVF, we will not develop it.

Degraded Rainforest

Degraded rainforests - defined as land which has been logged repeatedly throughout the 20th Century, destroying the structure of the rainforest. There is little if any timber of commercial value left and logging trails have damaged the soil structures. there are instances where the group will develop on this type of land which governments typically set aside for agriculture, after conducting a thorough environmental impact assessment. our land development will strictly adhere to local regulations, RSPO sustainability criteria and a zero burn policy.

Cleared Rainforest (Bare Land)

These are degraded rainforests that have been cleared by slash and burn throughout Indonesia and in particular Kalimantan, by farmers and others who simply wish to lay claim to the land. Farmers slash and burn and then continue to burn the land on an annual basis. In Indonesia, there are no clear land titles. The Indonesian Government and local authority decide which areas can be developed for agriculture. Although land tenure and rights in Indonesia remains ambiguous, we will work to ensure that all mutual agreements with communities and individuals in Indonesia are clearly defined, documented and legally established, thus demonstrating clear evidence of long term land use rights for our land.

Zero-Burn Policy

We adhere strictly to a policy of zero burning. During the land clearing stage, remnant debris comprising bushes or small trees which are felled, are left to biodegrade, releasing nutrients slowly, thus adding valuable organic matter to the soils, reducing the use of fertilizers during the planting period and lowering carbon dioxide emissions.

Ecology, Wildlife Conservation and Biodiversity.

We are committed to ensuring the conservation of rare, threatened and endangered species and understand that a well managed compromise between conservation and development is needed. Buffer zones between forests, major rivers and the plantations. We adopt a soft approach to keeping wildlife out of the plantations and within dedicated wild life protection areas. We conduct training and education of staff on biodiversity issues, have a strict prohibition on hunting, and collaborate with state wildlife departments, such as in Sabah, East Malaysia. We will also continue to work with other wildlife conservation bodies in identifying High Conservation Value areas that contain rare, endangered or threatened species such as the Orang Utan and the Sumatran tiger.

RSPO

Formally established under article 60 of the Swiss Civil Code in 2004, the principle objective of the RSPO (Roundtable on Sustainable Palm Oil), is to “promote the growth and use of sustainable palm oil through co-operation within the supply chain and open dialogue between its stake holders”.

The RSPO has members representing palm oil growers, palm oil processors and traders, consumer goods manufacturers, retailers, banks and investors, environment/conservation NGOs and social/development NGOs.

We are active members of the RSPO and encourage other stakeholders to join the roundtable. We are one of 15 plantation owners/operators to have volunteered to have its plantations used in an RSPO pilot test program, which started in November 2005.

We have been actively assessing our policies, practices, and operations in all of our palm oil plantations as part of self-assessment to to determine compliance to the propsed RSPO principles and criteria.

)ur continued business success relies upon the availability of our crops as a renewable resource. It is in our interest both as an agribusiness company and as a responsible corporate citizen to keep the environment healthy and productive through responsible management. In this regard, Wilmar promotes sustainable palm oil production and aims to increase the production volume in our supply chain from third-party certification using the Roundtable on Sustainable Palm Oil (RSPO) standards framework as benchmark, which we believe currently represents the highest standards for the industry.

Wilmar was one of the first palm oil companies to achieve RSPO certification, having attained our first certification for four estates and three mills in December 2008. Currently, all of our mills and estates in Malaysia have successfully attained the RSPO certification. We are progressively pursuing audits for the rest and have in place a time-bound plan for all our plantation operations to be RSPO certified.

Apart from our own plantations, we also procure and source oil palm fruits from local – supported (plasma) and independent – smallholders for our mills. Like other palm oil companies, we recognise that many of these suppliers may not meet our expectations immediately, which may limit our ability to procure palm oil from sustainable sources.

Despite the supply chain complexity facing us and the industry, we remain resolved to work with multi-stakeholders including local farmer-suppliers, the industry and civil society organisations to address these challenges. We advocate the RSPO concept and its accompanying standards to our associated smallholders as well as train and encourage them to adopt responsible agricultural practices. We hope to ultimately bring them on board our certification scheme and integrate them into our sustainable value chain.