Ethical Performance
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Firm makes forest pledges

March 2011

The world’s second largest palm oil plantation company has announced a forest conservation policy aimed at ensuring it has a ‘no deforestation footprint’.

Golden Agri-Resources, the palm oil arm of Indonesian conglomerate Sinar Mas, has produced the policy in conjunction with the Indonesian government and The Forest Trust (TFT), a global charity promoting sustainable forest management.
It commits the company not to clear ‘high carbon stock’ forests or areas of high conservation value, to ‘show respect’ for indigenous and local communities, and to comply with the principles of the Roundtable on Sustainable Palm Oil.

Golden Agri-Resources, which controls 435,000 hectares in Indonesia and has a $5billion (£3.1bn, €3.7bn) market capitalization, will start fieldwork with TFT and other stakeholders ‘in the first half of 2011’ so that it can determine exactly how to fulfil its commitments.

The company has provisionally said it will not develop land containing over 35 tonnes of carbon per hectare, in line with figures recommended by the Indonesian government.

It has also committed to evaluate and report on its performance against the new policy on its website, through an annual CSR report, and via ‘ongoing engagement with key stakeholders’.  

Scott Poynton, executive director of TFT, said the commitment had evolved from ‘many discussions and field visits over the past months’.

The policy has been welcomed by Greenpeace, which has campaigned against Golden Agri-Resources in recent years and claims to have been partly responsible for persuading international corporations such as Nestle and Unilever to cancel contracts with the company.

‘On paper, the new commitments from Golden Agri are a major step towards ending its involvement in deforestation’, said Bustar Maitar, head of Greenpeace’s campaign to protect Indonesian forests.

‘If they do make these changes, large areas of forests will be saved. But now they’ve actually got to implement these plans, and we’re watching closely to make sure this happens.’

Golden Agri-Resources is also developing a ‘social and community engagement policy’, which it hopes will ‘ensure a holistic approach towards our sustainability commitments’. 

Golden Agri-Resources | Asia | Environment

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