IOI Corp details five step plan for RSPO re-entry

PETALING JAYA: IOI Corporation Bhd (IOI Corp) has submitted a five step action plan which it is confident will be able to over turn the suspension of the Round Table on Sustainable Palm Oil (RSPO) certification for the entire group’s oil palm production.
According to the plantation giant, the suspension was in respect of complaints against its Indonesian subsidiaries’ plantation estates that only produced about 2% of IOI Group’s annual crude palm oil production.

According to complaints by non-governmental organisations, the plantations were alleged to be non-compliance to the RSPO certification systems regulations, failing to submit the new planting procedure (NPP) documentations within the prescribed time, as well as non-adherence to the RSPO principles and criteria pertaining to the development of palm oil plantation.
However, a letter from RSPO dated March 14, 2016 stated that while it found IOI Corp to be in compliance on certification systems regulations and submitting new planting procedures, criteria and principles on the development of palm oil plantation, had not been strictly adhered to.
IOI Corp told Bursa Malaysia yesterday that the group had on March 23 2016, submitted a detailed and comprehensive action plan to the complaints panel and is actively engaging with RSPO to review the action plan and to resolve the issues without further delay.
The steps to be taken in the action plan includes preparation of the legal register detailing all relevant Indonesian legislation; regulations and guidelines related to the development and operations of palm oil plantation as well as conduct stakeholder engagement with all the relevant governmental department and ministry regulating the palm oil industry in Indonesia; particularly the local governor’s office; forestry department, Ministry of Agriculture and the Department of Environment to ensure comprehensive understanding of the legal procedures and processes.
IOI Corp will also make preparation and compilation of its standard operating procedures, and a checklist concerning compliance with all legal and regulatory requirements, in respect of the development and operations of palm oil plantation in Indonesia.
The plan includes IOI Corp conducting internal capacity building for all relevant personnel responsible for legal and regulatory compliance; and lastly, provide records of all existing completed compliance records, such as licenses, permits and approvals for all its operations in Indonesia.
“We believe that the above measures are comprehensive and will resolve the complaints,” the group said.
A spokesperson said IOI Corp “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; these potential sales losses are not quantifiable.”
IOI Corp said, as a founding member of the RSPO, the company recognises the importance of sustainability and has played an active role in promoting sustainable practices since its inception in 2004.
“IOI Group has been fully committed in upholding the requirements of RSPO and will continue to deliver sustainable palm oil to the market,” the spokesperson said.
The group’s shares rebounded by 0.65% to RM4.66 yesterday. Some 15.86 million shares changed hands.