IOI Corp engaging with RSPO to address issue of certification

palm oil stakeholders ioi
Malaysia palm oil firm IOI has promised to conduct stakeholder engagements with all relevant government departments and ministries regulating the palm oil industry in Indonesia. Image: Shutterstock

IOI Corporation Bhd said it is actively engaging with the Roundtable on Sustainable Palm Oil (RSPO) with regards to suspension of the RSPO certification of the entire IOI Group effective April.

In a filing to Bursa Malaysia, IOI said it has received the letter notifying the suspension of RSPO certification in respect of complaints against its Indonesian subsidiaries’ plantation estates, which produced approximately two per cent of IOI Group’s annual crude palm oil production.

IOI said it is very concerned about the impact on its stakeholders and reputation if the Group is not able to supply certified palm oil in the future due to prolonged suspension, adding these potential sales losses are not quantifiable.

“As a founding member of the RSPO, IOI Group recognises the importance of sustainability and has played an active role in promoting sustainable practices since its inception in 2004,” it said.

IOI said it submitted on March 23 a detailed and comprehensive action plan which is in accordance with the prescribed format, adding it is actively engaging with the RSPO to review the plan and to resolve the issues without further delay.

Among the steps to be taken is preparation of the legal register detailing all relevant Indonesian legislation, regulations and guidelines related to the development and operations of palm oil plantations.

It will also conduct stakeholder engagements with all the relevant government departments and ministries regulating the palm oil industry in Indonesia, particularly the local governor’s office, Ministry of Agriculture as well as the Ministry of Environment and Forestry to ensure comprehensive understanding of the legal procedures and processes.

Another measure is the preparation and compilation of standard operating procedures and a checklist concerning compliance with all legal and regulatory requirements concerning the development and operations of palm oil plantations in Indonesia, it said.

It will also conduct internal capacity building for all relevant personnel responsible for legal and regulatory compliance and provide records of all existing completed compliance records, such as licences, permits and approvals for all its operations in Indonesia.

“We believe that the measures are comprehensive and will resolve the complaints,” it said.

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