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Tuesday, 7 June 2016

IOI withdraws RSPO suspension challenge

To recap, IOI last month launched a legal action against RSPO’s decision to suspend its certification following allegations of deforestation and other wrongdoings by its Indonesian subsidiaries.

To recap, IOI last month launched a legal action against RSPO’s decision to suspend its certification following allegations of deforestation and other wrongdoings by its Indonesian subsidiaries.

PETALING JAYA: IOI Corp Bhd has withdrawn its challenge proceeding against the suspension of its certifications by the Roundtable of Sustainable Palm Oil (RSPO) in the Zurich District Court of Switzerland.

In its filings with Bursa Malaysia, the plantation group said the withdrawal of the challenge proceeding would be formalised during a conciliatory hearing before the Justice of Peace on June 14.

To recap, IOI last month launched a legal action against RSPO’s decision to suspend its certification following allegations of deforestation and other wrongdoings by its Indonesian subsidiaries.

“Since the filing of the challenge proceeding, IOI has engaged with many of our stakeholders such as customers, NGOs and RSPO to resolve this matter.

“As of to-date, IOI has completed the action plan and submitted to RSPO on May 30, 2016, a memorandum on our sustainability policy initiatives and resource deployment which was endorsed by our board of directors,” the company said.

According to IOI, one of the key policy initiatives stated in the memorandum was its commitment to voluntarily adopt the more stringent RSPO next certification system starting from end-2016.

“The abovestated initiative affirms our commitment and support towards the sustainability principles and the work of RSPO, an organisation of which we are a founding member and on whose board we have been serving for 10 years already,” IOI said.

The company was notified of its suspension by the RSPO on March 25 in respect of complaints made by a non-governmental organisation against IOI’s Indonesian subsidiaries.

Among the issues raised were the subsidiaries’ alleged non-compliance with the RSPO’s certification systems regulations, failing to submit new planting procedure documentations within the prescribed time, and non-adherence to the RSPO principles and criteria pertaining to the development of oil palm plantations.

IOI’s suspension had directly affected its relationship with major buyers, who are especially sensitive to palm oil sustainability standards. Nestlé, Kellogg, Mars and Mondelez were among the big names that had sourced palm oil from other suppliers as a result of IOI’s suspension.

The company has an established presence in Europe. It owns the continent’s biggest palm oil refinery in the Netherlands with a capacity of 1.2 million tonnes a year. It also has a specialty oils and fats plant in the country as well as another two oleochemical plants in Germany.

Tags / Keywords: Palm Oil , Plantations , Commodities , Stocks , Earnings , Corporate News , Investing , IOI , RSPO , palm oil

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