Palm traceability sector (update 3a): GAR/Sinar Mas back in NGO focus, TFT suspends Golden Agri takes (and hours later a new chief sustainability officer is appointed for the plantation giant - Agus Purnomo)

21 May 2015: TFT suspends Golden Agri takes (and hours later a new chief sustainability officer is appointed for the plantation giant - Agus Purnomo)
 
Key issues and questions arising from Golden Agri / PT Smart's present situation:

• Despite innovative industry attempts to promote traceability as a more inclusive solution (versus RSPO which struggles to include small producers and independent smallholders) while heightening key pledges such as "no deforestation, no peat and no exploitation," recent events raise the question of whether producers can live up to promises ("hastily made" according to many key industry players). 
• Is palm oil entering a renewed phase of boycott risks? At the SIIA Singapore Dialogue, several IPOP members sat on a panel where Wilmar made a public pledge that it would (if told by other IPOP members) stop buying from any "errant suppliers" who were unable to make the necessary upgrade moves (and if it found such, it would stop buying; tell its fellows and request they would do likewise). Other panelists suggested more focus on constructively working with suppliers for improvement rather than boycott. If agreed, the IPOP "supplier boycott" proposal should give some teeth to the group. But it seems that IPOP members are not clear of the boycott risk themselves; with Golden Agri, a lead member itself now facing RSPO censure and TFT suspension.
• Many industry players regard the shift to TFT B2B traceability as part of a processor-trader led move to find a more business-ready solution (that now seeks to shift the centre of gravity to refinery "supply sheds"; away from the RSPO mill and supply base P&C and RSPO's relatively costly physical supply chain SCCS outlook). The palm oil supply chain has since the mid 2000s been spending time and effort via NGO service providers, auditors and their newly established sustainability teams.
• Industry watchers have been concerned about how widely known implementation gaps among the top highly rated traceable plantation groups will be treated by the broader NGO sector. Clearly, business life is hardly straight forward and the current issues suggest that there is no place for over-confidence and complacency while using new solutions. It seems we are entering a "third wave" where social issues and implementation will be primary - but have the big plantation groups put in enough resourcing to upgrade their implementation efforts to their pledges?  

Some background on IPOP group here: Tuesday, October 7, 2014 Indonesia Palm Oil Pledge (IPOP) /khorreports-palmoil/2014/10/indonesia-palm-oil-pledge.html. At the SIIA dialogue we had a useful chat with a Catapult Campaigns staffers who confirmed their key role in the New York Declaration and IPOP. On the risk of large dominant players establishing boycotts on smaller suppliers (raising question on economic interest suppression), there was no answer. A key consideration is on campaign advocacy efficiency and impact.

News link:

Golden Agri takes another hit as sustainability guru suspends its membership by Philip Jacobson May 20, 2015; The charity that Indonesia's Golden Agri-Resources has enlisted to devise and implement its zero-deforestation and community-engagement commitments suspended its cooperation with the palm oil giant yesterday, following "several breaches" of the policies they had designed together, according to The Forest Trust (TFT), which helps companies run responsible supply chains. A few hours after TFT announced the suspension, Singapore-listed Golden Agri said in a statement that its chief sustainability officer, Peter Heng, had resigned "to pursue new career opportunities." His replacement is Agus Purnomo, who has headed one of Golden Agri's Indonesian subsidiaries, Sinar Mas Agro Resources and Technology (Smart). Smart's own subsidiary, Kartika Prima Cipta, became the subject of a formal complaint against its operations last year after Golden Agri filed to expand its plantations in 18 of its subsidiaries including Kartika Prima, despite evidence that Kartika Prima had taken community land without residents' informed consent, failed to properly conduct a high-conservation value (HCV) assessment and more. The grievance was lodged by the Forest Peoples Programme (FPP), a UK-based NGO, with the Roundtable on Sustainable Palm Oil (RSPO), the industry's largest voluntary certification scheme. Though TFT was vague in its announcement, the suspension is almost certainly a response to what is apparently seen as Golden Agri and Smart's lackluster handling of the RSPO complaint, which takes on additional importance because Kartika Prima is piloting Golden Agri's sustainability commitments. The RSPO upheld the complaint in March and earlier this month prohibited Golden Agri from "acquiring or developing any new areas" pending its resolution.... Read more: http://news.mongabay.com/2015/0520-jacobson-tft-suspends-golden-agri.html#ixzz3aj9U4zFv


16 May 2015: It's not plain sailing for plantations who've gone in with the "second wave" of heightened "three nos" on peat, deforestation and exploitation

It's not plain sailing for plantations who've gone in with the "second wave" of heightened "three nos" on peat, deforestation and exploitation. Sector risk is of a "third wave" of rather tough to resolve social issues, which may be heightened due to the HCS / high carbon stock regimes coming into play.

The Roundtable on Sustainable Palm Oil (RSPO) has prohibited Golden Agri-Resources (GAR), one of its most prominent members, from "acquiring or developing any new areas" pending the resolution of a formal complaint against the palm oil giant in Indonesia's West Kalimantan province.  The decision by the RSPO, the world's largest voluntary certification scheme for palm oil, is a stern directive from an organization that has been criticized for failing to take action against companies that flout its standards....  Read more: http://news.mongabay.com/2015/0508-jacobson-rspo-complaint-gar-fpp.html#ixzz3a19AYBFj<<a%20href=>">http://news.mongabay.com/2015/0508-jacobson-rspo-complaint-gar-fpp.html#ixzz3a19AYBFj

16 Jan 2014:

Khor Reports comment: Plantation partnership deals with some NGOs does not preclude good implementation and monitoring by other NGOs. GAR/Sinar Mas had faced boycotts and enlisted TFT-Greenpeace to help (Wilmar is now also signed up on TFT-Greenpeace HCS Approach and other principles). Now, plantation planners should prepare for larger set-aside areas for their new plantings.

The latest news on GAR from a study by Forest Peoples Program / FPP (see news links) highlights some problems of high carbon stock (HCS)/social implementations of the new policies of TFT-Greenpeace for GAR. GAR said, “We thank FPP for their additional findings which have assisted our own full field audit of PT KPC, conducted in partnership with The Forest Trust.” Separately, APRIL and RGE are under pressure from Greenpeace.
News: http://www.eco-business.com/news/golden-agri-april-under-fresh-scrutiny-unsustainable-practices/ 

Australia resource industries seek ban of market boycotts (update 1)

3 May 2014:

Ben & Jerry's referred to consumer watchdog over save-the-reef campaign; theguardian.com, Friday 2 May 2014 06.58 BST; http://www.theguardian.com/environment/2014/may/02/ben-jerrys-referred-to-consumer-watchdog-over-save-the-reef-campaign; Ice-cream company’s ‘mistruths could cost jobs’, says Queensland LNP senator elect who has written to the ACCC; "Queensland LNP senator elect Matthew Canavan said he wrote to the Australian Competition and Consumer Commission (ACCC) on Tuesday to consider the company’s conduct... “Australia has strict laws to protect consumers against misleading and deceptive behaviour,” he said. “These mistruths could cost jobs and development in regional Queensland. It’s irresponsible behaviour from a company that should know better.”.. The Queensland premier Campbell Newman also said on Thursday: “The World Wildlife Fund can make such false assertions, so be it. But a company is bound by consumer law and can’t make false and misleading statements and they are making false and misleading statements when it comes to this.”...


3 April 2014

Australian government may ban environmental boycotts; Guardian Australia: Parliamentary secretary says there is 'an appetite' for removing environmental groups' exemption from secondary boycotts ban; Thursday 3 April 2014; http://www.theguardian.com/environment/2014/apr/02/coalition-review-of-consumer-laws-may-ban-environmental-boycotts: "Coalition MPs and industry groups are using a review of competition laws to push for a ban on campaigns against companies on the grounds that they are selling products that damage the environment, for example by using old-growth timber or overfished seafood....  Groups including the Australian Forest Products Association and parts of the seafood industry are also preparing submissions to the review arguing that environmental campaigns against companies selling products made from native timbers or “unsustainable” fishing amount to a “secondary boycott” and should be unlawful....  But the new state Liberal government intends to undo the forest “peace deal”, expand sawlog production and stop environmental campaigns through tough new state laws aimed at protesters. It is also lobbying the federal government for a change to competition laws to stop market-based campaigns.... Colbeck said he would be suggesting a further change to competition law to increase the power of the Australian Competition and Consumer Commission to police general claims made by environmental groups about particular types of products “to ensure that they are truthful”.... “They can say what they like, they can campaign about what they like, they can have a point of view, but they should not be able to run a specific business-focused or market-focused campaign, and they should not be able to say things that are not true,” he said.... Groups like GetUp! and Markets for Change are currently exempt from section 45D of the Consumer and Competition Act which prohibits actions that stop a third person buying goods from another....

Tasmanian forests set for logging as Liberals push ahead with repeal; State government unveils plan to tear up historic deal between industry and greens protecting 400,000 hectares of forest; Australian Associated Press; theguardian.com, Tuesday 8 April 2014; http://www.theguardian.com/environment/2014/apr/08/tasmanian-forests-logging-liberals-repeal

Khor Reports comment: Interesting to see a possible push back from Australia industry, state and federal government over market boycott campaigns by domestic NGOs. In contrast, palm oil has been facing significant market campaigns, but at a transnational level. Actions have been taken by palm oil producers in the French trade tribunal, for instance, but negative market actions continued and the number of products affected continued to rise. Also interesting that this is the second time in as many months that we read of a competition act possibly used in relation to the sustainability issue.

Cambodia local elections impacted by land discontent?

Cambodian PM's party triumphs in election test run,PHNOM PENH | Tue Jun 5, 2012 5:37am EDT:"Official results from Sunday's elections for the chiefs of areas known as communes are not expected for several weeks but the major parties were in agreement that Hun Sen's Cambodian People's Party (CPP) had swept the polls, as it has in all national ballots in the past decade. The CPP claimed 72 percent of the seats in what it sees as a test of support ahead of the 2013 election. General elections take place every five years....The latest polls did throw up some signs of discontent, with the CPP's notable loss of seats in areas that have seen long-running land disputes and forced evictions from land leased to foreign companies. The government suspended new land concessions to foreign firms in May...." http://www.reuters.com/article/2012/06/05/us-cambodia-elections-idUSBRE8540E420120605

Khor Reports comment: In the 2007 commune elections, the Cambodian People's Party won 1,592 commune chief (97%) out of 1,633 communes. The claimed victory of 72% of seats last month suggests a 17%-age point reduction in the number of seats. Just before the elections, new economic land concessions to foreigners were frozen. In the previous two years, there had been a surge in award of such concessions. Land disputes seem to be rife and these have apparently impacted on the ruling party's electoral results, although it still holds a very commanding position. When we started to research Cambodia agricultural concessions several years ago, there was little sign of NGO activity. Now, there are several active on land dispute matters. One is focused on sugar projects, lobbying foreign-buyers to boycott Cambodian sugar because of land conflicts.