Slide 1: 10 August 2010
10 August 2010
Slide 2: Disclaimer
This presentation has been prepared by PT SMART Tbk (“SMART” or “Company”) for informational purposes. This presentation contains statements, representation which may or may not be derived from third party reports, quotes from sources other than from within the Company, projections and forward looki
Slide 3: Agenda
1. Introduction 2. Summary of Greenpeace claims 3. Summary of findings 4. Key points 5. Findings 6. Conclusion 3
Slide 4: The Independent Verification Team
THE INDEPENDENT VERIFICATION TEAM Appointed in April 2010 after consulting Unilever CUC, BSI and assisted by Bogor Agricultural Institute experts Prof. Dr. Bambang Hero Saharjo and Dr. Ir. H. Yanto Santosa SCOPE To verify the claims in the Greenpeace reports: - Burning Up Borneo - Illegal Forest Cle
Slide 5: Scope
SCOPE To provide accurate, complete and contextual information to assess Greenpeace claim, and identify gaps, if any To verify claims against: – Prevailing laws and regulation in Republic of Indonesia – The Indonesian national interpretation of Roundtable on Sustainable Palm Oil (RSPO) principles an
Slide 6: Covered concession areas
Covered 11 concession areas 182,528 ha, over 40% of GAR total planted area of 430,200 ha West Central Field work 31 May – 8 Jun 17 May – 22 May Concessions - PT ALM - PT BAP - PT KPC - PT BAT - PT KGP - PT LUJ - PT PGM - PT MKA - PT PIP - PT SKU - PT TN 6
Slide 7: Summary of Greenpeace claims
1. Destroying primary forests, orang-utan habitats and HCV areas 2. Clearing and planting on peat land 3. Burning forests 4. Clearing land without permits 5. Causing social conflict 6. Engaging in selective RSPO membership 7
Slide 8: Summary of findings
1. Degradation process of primary forest areas that were habitats for Borneo orang-utan happened before SMART started the operations of the concessions. All 11 concessions are on degraded land. 2. Clearing peat land is not as extensively as claimed. 1.8% (3,210 ha) of peat (>3m deep) cultivated on 1
Slide 9: Greenpeace claims are either exaggerated or wrong
Greenpeace claims are either exaggerated or wrong Not responsible for destruction of orang-utan habitats Not responsible for deforestation of primary forests Not responsible for burning Operates responsibly and within the laws Vital player and part of the solution 9
Slide 10: Findings
Findings 10
Slide 11: Orang-utan habitat: all concessions consist of degraded land
THE FINDINGS: All concessions consist of degraded land Orang-utan’s habitat already affected by earlier activities such as logging, slash and burn economy OUR STAND: We believe in protecting and conserving the orang-utan as a vital part of Indonesia’s and the world’s heritage 1,400 ha sanctuary in C
Slide 12: Deforestation of primary forest: before SMART started operations
Deforestation of primary forest: Before SMART started operations THE FINDINGS: Not responsible for the deforestation of primary forest All plantations are confirmed to be degraded land OUR STAND: Complies with laws and regulations Complies with principles and criteria of RSPO Committed not to plant
Slide 13: Source: UNFCC Secretariat 2007
Source: UNFCC Secretariat 2007 13
Slide 14: Indonesia: Land and forest classification
Indonesia: Land and forest classification 51.5 million square hectares (28%) of Indonesia’s total land mass of 187.8 is classified as protected forest and conserved area Types of land and forest Hectares in % of total SMART square millions land mass development Forestry Area Protected forest 31.6 17
Slide 15: Indonesia: Agriculture and plantation land use by key crops
Indonesia: Agriculture and plantation land use by key crops Plantation Crops Farm Crops * Including coffee, cocoa, sugar, pepper and tobacco ** Including peanuts, sweet potatoes and cassava Source: FAO 2009, MOA 2009 15
Slide 16: Palm Oil: More sustainable
Palm Oil : More sustainable Palm oil uses only 5% of global Palm products supply 31% of global oilseed land use edible oil Castorseed Sesameseed 1% Linseed 3% 1% Palm Oil Groundnuts Coconut 5% Others CPO & PKO 9% 4% 24% 31% Cottonseed 13% Sun Oil Soybean CNO 8% 41% 2% Sunflowersee Rape Oil Soyoil d
Slide 17: HCV Assessment: In transition
HCV Assessment: In transition THE FINDINGS: HCV is dynamic and ambiguous, with varying results HCV assessment is a daunting task to identify and conserve HCV Cleared 37,698 ha or 21.0% of the concession areas before HCV assessment OUR STAND: We will not develop HCV land Working with stakeholders to
Slide 18: Clearing and planting on peat land: not extensively as depicted
Clearing and planting on peat land: Not extensively as depicted THE FINDINGS: 1.8% of concessions developed on peat of >3m deep Description Central West Total Deep peat (ha) 1,880 1,330 3,210 Total concession (ha) 90,278 92,250 182,528 Percentage (%) 2.1 1.4 1.8 OUR STAND: Serious action against non
Slide 19: No evidence of burning in land clearing and preparation
THE FINDINGS: No evidence of burning in land clearing and preparation Hotspots likely to have been caused by slash-and-burn practices of the local community OUR STAND: Absolutely against burning, established policy in 1997 Prompt action towards illegal fires Routine fire patrols during the dry seaso
Slide 20: Land development permits: Pursuing compliance
Land development permits : Pursuing compliance THE FINDINGS: Environmental Impact Assessment (EIA) or AMDAL for all 5 concessions in West Kalimantan in order In Central Kalimantan, AMDAL process completed after land clearing for all 6 concessions which is not in compliance OUR STAND: SMART pursues c
Slide 21: Relations with local landholders and communities
THE FINDINGS: No evidence of negative relations with local landholders - including those that did not sell land to SMART Evidence that the plantations improved livelihoods SMART documentation of land transaction process should be improved Relations with indigenous people were not addressed OUR STAND
Slide 22: Selective RSPO membership
THE FINDINGS: SMART and PT Ivo Mas Tunggal are members They are in the process of RSPO certification OUR STAND: To obtain RSPO certification for all of GAR’s existing palm oil operating units by 2015 GAR to become RSPO member 22
Slide 23: Greenpeace claims are either exaggerated or wrong
Greenpeace claims are either exaggerated or wrong Not responsible for destruction of orang-utan habitats Not responsible for deforestation of primary forests Not responsible for burning Operates responsibly and within the laws Vital player and part of the solution 23
Slide 24: Thank you