Palm Ventures 2021 Sustainability Report
(A Hypothetical Excerpt)
1|Page
Contents
Introduction
2
About Palm Ventures
3
2021 Highlights
6
Our Approach to Sustainability
7
Sustainability Impact Baseline Data
8
Measuring & Managing ESG risks
9
Appendix 1 – SPOTT Scorecard Excerpt
1|Page
11
Introduction
Welcome to Palm Ventures 2021 Sustainability Report. This report is Palm Venture’s third annual
sustainability report, which builds on the performance and learnings of past performance. It
contains information on our strategic environmental, social and governance (ESG) risks,
objectives, priorities, and initiatives. It provides shareholders with detailed information on Palm
Ventures’ sustainability performance and challenges.
The report primarily relates to Palm Ventures’ FY21 corporate activities, which covers the period
Jan 2021 – Dec 2021, but in many instances forward-looking statements are also included to
demonstrate Palm Ventures’ good faith and intended activities in relation to this report.
The report provides a summary of our FY21 sustainability performance and discusses our
approach to sustainability and how we measure and manage our ESG risks across our value
chain.
Where Palm Ventures has been required to rely on third-party information, unless explicitly
communicated the sources of this information have not been independently verified and Palm
Ventures therefore does not take responsibility for the accuracy of this information. In future, we
are considering aligning our sustainability reports with the Global Reporting Initiative and also
having them independently assured.
2|Page
About Palm Ventures
Palm Ventures is located in Indonesia, headquartered in Jakarta and was established in 1997.
We are one of Indonesia’s largest palm oil plantation companies.
Our plantations are located within various regions in Indonesia, including Riau, Jambi, South
Sumatra, East Kalimantan, and Papua.
We both produce and trade palm oil. Our main business activities comprise cultivating oil palm
trees, harvesting and processing Fresh Fruit Bunches, producing Palm Kernel, Palm Kernel Shell,
Crude Palm Oil, and Crude Palm Kernel Oil.
Our vision is to be the largest Indonesian-based, worldwide provider of quality, palm oil
products. We also aim to enrich our communities and strengthen economic and community
development as evidenced by our engagement with 33,000 smallholders (with 64,500 hectares of
oil palm planted) to date on a contractual basis.
3|Page
Overview
Revenue
USD
4|Page
200.0bil
Employees
Hectares
Planted
140,000
30,000ha
Refineries
Mills
Plantations
Smallholders
21
18
8
33,000
Our Key ESG Values
●
●
●
●
●
●
Treat all staff, customers, and suppliers with respect.
No exploitation: respect land tenure rights and the rights of indigenous and local
communities.
Promote open and honest communication.
Support community empowerment and livelihood improvement.
Protect forests and biodiversity.
Ensure a sustainable palm oil supply chain.
In recent years, we have been confronted with many ESG challenges, which have impacted the way
we grow, source, and process our products – and operate our business more widely. In particular,
the impacts of the external investigation into our operations in 2018 have significantly impacted our
approach to sustainability, requiring us to change the way we work, manage our supply chain and
engage with our stakeholders.
Material Matters
The following are key ESG issues that are most important to Palm Ventures’ stakeholders.
Priority Topics
Sustainable
Supply Chain
Human
Rights
Environmental
Footprint
Product Quality
& Safety
Important Topics
Data Privacy
5|Page
Waste & Effluents Employee Training
& Development
Management
Community
Contribution
Energy Efficiency
Management
2021 Highlights
Our key sustainability achievements from FY21 are highlighted below:
●
80% of our mills and 63% of our plantations have achieved Roundtable on Sustainable
Palm Oil (RSPO) certification to-date. We have also achieved RSPO certification for 60%
of our smallholders.
●
We have restored 5,000 hectares of forest in Riau, Indonesia (in line with our 50,000hectare restoration goal).
●
We have constructed 3 methane capture facilities at our mills in Pekanbaru (Riau),
Muaro (Jambi) and Keerom (Papua).
●
We introduced a new carbon footprint management target: to reduce our scope 1 and 2
GHG emissions intensity by 10% by 2025 from our 2021 baseline.
●
Our waste prevention recovery operation has prevented 6.3MT of waste from disposal.
6|Page
Our Approach to Sustainability
Our approach to sustainability is integrated into our business decisions and
processes. We take a risk-based approach to sustainability, which seeks to
be proactive and prevent sustainability-related issues before they arise.
Given Palm Ventures is founded on farming practices – we take our approach to land
management and the consumption of natural resources seriously and understand that we have a
responsibility to do the right thing by our stakeholders – including the communities that we
serve and operate in. We are therefore committed to managing our resources carefully and
efficiently.
Our sustainability principles, which underpin our approach include:
●
●
●
●
Resourcefulness – We think carefully about the natural resources we use across our
business operations and seek to reduce our consumption of resources wherever
possible.
Transparency – We are committed to sharing our progress with our shareholders to
communicate sustainability challenges, learnings, and opportunities.
Innovation – We constantly seek to explore new technologies and approaches to
farming, sourcing and processing our products with reduced impact on the environment.
We seek to be at the forefront of sustainable farming and production techniques in
Indonesia and beyond.
Health & safety – We take health and safety practices seriously and prioritise the
implementation of company policies and procedures to prevent health and safety-related
incidents before they arise.
Our key sustainability initiatives include:
●
●
●
We have sustainability policies in place to communicate our ESG values and
commitments with our shareholders. These policies apply both to our suppliers and
operations.
We collaborate with industry stakeholders such as the Peat Restoration Agency to
mitigate the environmental impacts of palm oil production.
We have a zero-deforestation commitment in place and monitor our direct progress
against this commitment.
7|Page
Sustainability Impact Baseline Data
Base Data
2020
2021
Sustainable
Supply Chain
•
Percentage of direct suppliers that have committed to
NDPE policy (%)
54
76
Certified
Sustainable Palm
Oil
•
•
•
Percentage of mills RSPO Certified (%)
Percentage of plantations RSPO Certified (%)
Percentage of smallholders RSPO Certified (%)
74
59
54
80
63
60
Human Rights &
Equality
•
92
100
40
65
30
34
•
Percentage of employees paid above legal minimum wages
of respective regions (%)
Percentage of direct suppliers that have human rights
commitments in their NDPE policy (%)
Percentage of suppliers receiving human rights awareness
training (%)
Number of Female Senior Management (#)
0
1
Environmental
Footprint
•
•
•
Scope 1 emissions by business activity (MT CO2e)
Scope 2 emissions by business activity (MT CO2e)
Methane From Palm Oil Mill Effluent (MT CO2e)
402,050
4,030
410,000
401,000
3,900
409,000
Grievance &
Complaints
•
•
Grievances raised against Palm Ventures operations (#)
Substantiated complaints raised from NGOs (#)
9
2
6
1
Waste & Effluents
Management
•
•
Total water discharged (ML)
Total waste diverted from disposal through recovery
operation (MT)
Total number of methane mills (#)
88,045
5.8
78,800
6.3
0
3
•
•
•
Training,
Development &
Safety
•
•
Percentage of employees employed in training schemes (%)
Percentage of Employees covered with Health Insurance
(%)
63%
77%
67%
79%
Community
Contribution
•
Number of smallholders supported (#)
28,500
33,000
Energy Efficiency
Management
•
Total energy consumption by business activity (MWh)
70,308,210
69,218,280
8|Page
Measuring & Managing ESG risks
Ever since an external investigation was conducted of our operations in 2018, we have taken a
more proactive approach to measuring and managing our ESG risks. The 2018 investigative
report linked our company operations to significant rainforest destruction and unfortunately the
impact of the report was made more significant by the fact that we had committed to ending
deforestation 5 years prior to the investigation.
The investigation found that deforestation was occurring in Riau, Indonesia with approximately
26,000 hectares of rainforest and peatland being destroyed over the 5-year period since our ‘no
deforestation’ commitment was made.
This controversy posed a major ESG risk for us and our customers, including high-profile
companies like Nestle, Unilever and PepsiCo. As a result, four executives from Palm Ventures
stepped down three days after the report was published. This report was a significant shock to
our business, given our value for the environment and our commitment to no-deforestation. For
this reason, ever since the report was published, we have committed to restoring 50,000 hectares
of forest in Riau. The remediation work is currently being monitored closely with publicly available
maps of the restoration areas.
In recent years, we have also been accused of buying palm oil from other mills that were found to
have destructive practices in place. Some media reports claimed that we attempted to conceal
our ties with these operators (from 2010-2015) and were running them as “shadow companies”
by allowing them to find a market with companies that don’t have zero-deforestation policies in
place. We strongly reject this claim and are open to working with the industry to address the issue
of “shadow companies” in the Indonesian palm oil sector. We are committed to making
improvements to our traceability system and also to no longer buy palm oil from suppliers found
to be violating our policies.
9|Page
As a result of the ESG issues and challenges we have been confronted with in the past, we now
take a risk-based approach to sustainability. The primary social and environmental risks of
concern for Palm Ventures in FY21 are summarised below in our sustainability risk analysis.
Risk type
Likelihood Impact
Palm Ventures control & mitigation measures
Climate change
High
Moderate Crop yields have proved variable. However, this has been mitigated by
acquiring facilities in different locations to minimise overall impacts.
Community engagement
Low
Moderate We are committed to supporting community empowerment, which is why we
support small, local community projects such as running a social assistance
program in Jakarta and donating to a PPE assistance program to help manage
the COVID-19 pandemic. We also donated to a school fundraising program in
Jambi and East Kalimantan across 2020-2021.
Deforestation & peatland
destruction
Moderate
Moderate We updated our Sustainability Policy in 2021 to include our commitment to
the reforestation of our affected regions and we have also established a new
zero-deforestation commitment
Water management
Moderate
High
We monitor projected rainfall & have water catchment opportunities in place to
help manage any dry periods we may experience.
Natural disasters
High
High
We maintain insurance cover for natural disasters. The level and type of cover is
reviewed annually. The cost of insurance has been significantly increasing
recently.
Biodiversity loss
Moderate
Moderate We have a camera trap at our plantation locations to look for animals in our
plantations to help us understand what animals are impacted by our farming.
We are also running a mangrove conservation project to help provide habitat for
migrant birds.
Disease or infestation of
plantations
Moderate
Moderate Increased staff training, and more regular monitoring to detect and identify
incidents has enabled early treatment of plantation diseases.
Misconduct, unethical
behaviour or corruption
Moderate
Transparency &
accountability
Moderate
Occupational health &
safety
Low
10 | P a g e
High
We now have formal company policies in place (which all employees must
adhere to) to prevent, mitigate, and manage misconduct. Our Code of Conduct,
Anti-corruption Policy, Conflict of Interest Policy, Confidentiality Policy and
Whistleblower Policy all assist with mitigating these risks.
Moderate We are attempting to improve traceability within our supply chain to ensure we
have improved visibility over the practises of our plantations and smallholders.
High
Palm Ventures has formal standard operating procedures and a Work, Health
and Safety Policy in place that requires employees and our leadership team to
take reasonable action to prevent potential injury to themselves, other
employees, customers, and suppliers.
Appendix 1 – SPOTT Scorecard Excerpt
Palm Ventures’ performance against the Sustainable Palm Oil Transparency Toolkit (SPOTT)
index on ESG transparency in the palm oil sector is summarised in the scorecard excerpt below:
ESG performance area
Palm Ventures
performance
Current ranking on the SPOTT platform for the transparency of ESG performance.
70/97
Comparison against past performance.
Down 2 points
Sustainable palm oil policy or commitment for all its operations?
Yes
Zero-deforestation commitments in place?
Yes
Zero-deforestation commitments extend to monitoring deforestation in supplier operations?
No
Has a general commitment to transparency in its supply chain?
Yes
Has a Board of Directors?
Yes
Has an Executive with technical ESG experience on the Board of Directors?
No
11 | P a g e
Has senior women in management roles or leadership positions (such as the Board of Directors)?
Yes
Collaboration with stakeholders to reduce negative environmental or social outcomes associated with
palm oil production?
Yes
Sustainability report published within the last two years?
Yes
Reports through a standardised reporting system (e.g. such as the Global Reporting Initiative)?
No
Shares the names and locations of company-owned mills?
No
Member of the Roundtable on Sustainable Palm Oil (RSPO)?
Yes
Has a time-bound plan for achieving 100% RSPO certification?
No
Has evidence of monitoring deforestation in supplier operations?
No
Has a biodiversity policy in place?
No
Biodiversity policy applies to all suppliers?
No
12 | P a g e
END OF PALM VENTURES 2021 SUSTAINABILITY REPORT EXTRACT
13 | P a g e