On 12 February 2019, Sime Darby Plantation (SDP) was made aware of an online report entitled ‘Who is Still Tied to Indofood?’ by Rainforest Action Network (RAN) at 11.15pm(Kuala Lumpur time). The report tells the decision by the Company to withdraw its membership from the Roundtable on Sustainable Palm Oil (RSPO), and named SDP as one of its trading partners.
In light of this report and upon our further confirmation, the management of SDP has decided to suspend with immediate effect any future dealing with Indofood until further notice. We will initiate further investigation into the matter and engage the Company to determine what, if any, restitution can be done to reverse their actions. We will also explore their willingness to join other responsible growers and commit to protecting human rights by adopting a No-Exploitation policy.
SDP would like to clarify that we do not have a long term contract with Indofood. Following RSPO’s complaint in October 2016, we worked with a long term trading partner to exclude the Company from our supply chain in South Africa and succeeded in the second half of 2017. However, in 2018, the Company re-entered our European supply chain via two spot purchases of crude palm kernel oil. Combined, these two spot purchases made up only 1.5% of the total volume of raw materials processed for that refinery. Despite the small volumes involved, this highlights the complexity of addressing unsustainable palm oil supplies via intermittent spot trades, as well as, the shortcomings in our system to effectively manage this.
We would like to thank RAN for alerting us on this situation through the publication of their online report. We welcome such vigilance by other concerned stakeholders to highlight similar issues. This approach assists us in abolishing workers exploitation within our palm oil value chain.
SDP will continue to review our own internal processes to further strengthen our due diligence and prevent sourcing of unsustainable palm oil within our supply chain. We will continue to uphold our NDPE commitments as reflected in our Responsible Agriculture Charter.