FSC report on palm giant Korindo lists litany of violations

A global body that certifies the sustainable forestry industry has released a batch of heavily redacted reports on violations carried out by palm oil firm Korindo, in the Indonesian region of Papua.

Heavy machinery and logs block access to Korindo’s PT Inocin Abadi logging concession. Image: MightyEarth

The Forest Stewardship Council has released a batch of heavily redacted reports into its probe of violations by a palm oil company operating in Indonesia, after it was earlier slapped with a cease-and-desist letter.

The FSC, considered the world’s foremost body certifying the sustainable forestry industry, found “clear and convincing evidence” that the company, Korindo had violated the rights of indigenous peoples in Papua by failing to properly consult local communities about plans to convert their land into oil palm plantations and by providing unfair compensation to the communities.

“As a result of these violations, the affected communities have suffered considerable harms,” says one of the reports. “These range from the threat and in some cases use of violence, in an ongoing atmosphere of intimidation (and above and beyond that associated with the prevailing local security setting); the inability to exercise their right to oppose the concession; and the highly disproportionate compensation payments, received by a minority of community members only, and with little knowledge or any participation on the part of many.”

The FSC also found “evidence beyond reasonable doubt” that there had been large-scale conversion of natural forests in the concessions held by Korindo, an Indonesian-South Korean joint venture that’s an FSC associate.

“The conversion was deemed to be significant among others due to its scale of more than 30,000 [hectares, or 74,000 acres] in the last five years, due to the failure to protect adequate areas of natural vegetation, and due to the impact that it has had on local communities and in particular the failure to compensate landowners adequately for the timber taken,” according to the summary of the reports.

The severity of Korindo’s wrongdoing revealed in these reports is just devastating, even with FSC and Korindo covering up more than 110 pages of the findings.

Deborah Lapidus, senior campaign director, Mighty Earth 

The cleared forests in Indonesia’s easternmost Papua region, on the island of New Guinea, were also found to be areas of high conservation value (HCV).

“This renders the conversion significant and is also likely to have contributed to the damage of HCVs,” the summary says. “In addition, the conversion most likely destroyed some areas that provided critical resources for local communities.”

The summary, however, concluded an allegation that Korindo had systematically used fire to clear land was likely untrue.

Significant redactions

The FSC also gave an estimate for the financial compensation due to the communities, included in the 110-page main report. However, that main report hasn’t been published. The reports that were published, meanwhile, feature significant redactions.

The FSC said that “due to a disagreement with Korindo, FSC is not in a position to publish the full document.”

It said the report contents that had been redacted pertained to personal information about independent experts, information outside the scope of the investigations, and information protected by data security laws.

The full findings of the two-year investigation, compiled into three investigative reports, had been set for publication on Sept. 5. However, Korindo, one of the biggest palm oil companies operating in Papua, sent a letter to the FSC ordering it not to publish further information specific to the findings, in a move perceived as a legal threat and that could explain the redactions.

Phil Aikman, campaign director at Mighty Earth, the advocacy group that first highlighted Korindo’s practices in Papua, said he’d had advance knowledge of the FSC reports and knew that the amount of money owed by Korindo to the communities ran into the “hundreds of millions of dollars.” That’s likely what compelled the company to issue the letter as part of a silencing tactic known as SLAPP (strategic lawsuit against public participation), Aikman told Mongabay.

“Korindo did not want that estimate to be published under any circumstances and hence has deployed SLAPP-style tactics to intimidate the FSC and other critics,” he said.

Mighty Earth senior campaign director Deborah Lapidus said the cease-and-desist letter was proof that Korindo had “something to hide,” and condemned the FSC’s self-censorship as unjustifiable.

“There is no justification that the FSC has gone along with Korindo in burying the full report, as these sorts of practices are all too commonplace in Papua and rarely exposed,” she said. “Remediation for communities is long overdue, and a full and honest disclosure of the FSC’s findings would do a lot of good.”

Nevertheless, she said the redacted reports at least showed a partial picture of the impacts of Korindo’s operations.

“The severity of Korindo’s wrongdoing revealed in these reports is just devastating, even with FSC and Korindo covering up more than 110 pages of the findings,” Lapidus said. “Korindo has previously attempted to spin the FSC conclusions as exoneration, but the findings released today prove that claim to be utterly dishonest.”

‘Denying culpability’

Korindo has previously admitted to engaging in massive deforestation and destruction of HCV forests, but said those actions “were dictated and imposed by the Indonesian government.”

In response to the release of the redacted reports, the company said the FSC’s rules were more stringent than prevailing Indonesian regulations, and thus while it may have violated FSC policies, it was still operating within the government’s rules.

“Although the FSC’s internal rules provide that sovereign laws and regulations supersede the FSC regulations, Korindo operations that have followed the strict administrative regulations and licensing requirements dictated by the Indonesian government may not have been in full compliance with the FSC regulations,” the company said.

It also rejected the findings that it had violated the rights of indigenous peoples in Papua. It said its practice of obtaining the free, prior and informed consent (FPIC) of local communities followed cultural norms in Papua, even though it might not have met FSC standards, which, again, the company deemed to be a high bar.

Korindo said land ownership in Papua was communal rather than individual, and that community leaders could make decisions on behalf of their communities. As such, the company said, some community members might not be satisfied by the decisions taken by their leaders, including regarding the compensation agreed on.

“As it is Korindo’s duty to respect and abide by the culture and customs of the clan, we cannot and do not interfere with the clan’s internal decisions,” Korindo said. “The FSC panel reports claim that these constitute the FPIC and human rights violation. Given this context, we do not accept the FSC panel’s claim.”

Anselmus Amo, a pastor with the Papuan indigenous rights organization SKP-KAMe Merauke, which has been advocating for some of the communities affected by Korindo’s operations, said the fact that lands in Papua don’t belong to individuals is precisely why the company should have properly consulted with each individual, not just the heads of the communities.

“The lands here are clan lands, so it’s not just the heads of the clans who sit down and sign [agreements],” he told Mongabay. “There needs to be enough room and time for [all indigenous members] to understand. There needs to be understanding [by everyone]. But does everyone feel that it’s their decisions and is everyone ready to accept the consequences [of selling their land]? It turns out to be not the case.”

Aikman said it was no surprise that Korindo disputed the FSC’s findings.

“Basically, Korindo doesn’t want to have to pay any financial compensation to communities for giving them a bad deal or no deal regarding their land and resource rights,” he said.

Lapidus agreed, adding that Korindo’s response strongly indicated the company had no intention of improving its conduct.

“If Korindo is serious about cleaning up its heavily damaged reputation, it must stop denying its culpability, embrace transparency, heed the FSC’s requirements for compensation and remediation, and resolve community grievances — including by returning customary lands,” she said. “Until it does, no companies should be doing business with Korindo.”

Remedial action

The FSC’s complaints panel, which conducted the investigation, recommended that “Korindo should be disassociated from the FSC due to the clear and convincing evidence of violations of traditional and human rights (as well as of significant conversion).”

That’s a stark contrast to earlier this year, when the FSC announced in July that Korindo would continue to be associated with the certification body, but that it must “secure remedy” for the damage it had done in Papua or else face expulsion from the organization.

The FSC argued at the time that continued engagement with Korindo was the best way to improving the company’s operations.

Since then, the FSC said it had decided on a set of five actions that Korindo needed to take to retain its certification, including a moratorium on land clearing across all its operations and commodities in Indonesia; protecting areas with high conservation value and high carbon stock forests; and undertaking remedial and improvement processes to ensure social measures are fair, proportionate and subject to the FPIC of affected communities.

Korindo acknowledged that there might be shortcomings in some of its operations and said it was committed to working with the FSC despite “the complexities of reconciling different and sometimes opposing regulations and views.”

Lapidus said the demands for improvement made by the FSC weren’t adequate.

“The remedial measures unveiled today are not proportionate to the extreme violations revealed in the investigative reports,” she said. “Notably, they fail to include restoration and remedy for Korindo’s clearing of over 50,000 hectares [123,500 acres] of rainforests and damage caused to the rivers and ecosystems, which violate FSC standards. It is also notable that Korindo’s first act after reaching the agreement with FSC was to bully FSC into censoring the details of its wrongdoing and its liabilities to communities. Korindo simply isn’t serious about accepting full responsibility for its violations of FSC standards.”

This story was published with permission from Mongabay.com.

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