Sime Darby Plantation unveils policy to ensure suppliers meet sustainability standards

  • Business
  • Wednesday, 03 Jul 2019

Apart from assisting the MD with the overall running of the group, Mohamad Helmy(pic) will continue to be responsible for the plantation upstream business.

KUALA LUMPUR: Sime Darby Plantation has strengthened its commitment to achieve a sustainable supply chain by publishing its ‘Working with Suppliers to Draw the Line on Deforestation’ policy statement.

Group managing director Mohamad Helmy Othman Basha said building on Sime Darby Plantation’s existing practice, the policy maps a step forward to meet the no deforestation, no peat, no exploitation (NDPE) standards as well as the company’s expectation that suppliers adhere to those same standards.

"This policy was crafted to ensure that our suppliers provide us and others with deforestation-free palm oil and, at the same time, improve their NDPE operational standards too,” he said.

He said the policy also makes clear the action the company would take when an issue is identified.

Based on the policy, Helmy said, if a supplier were found to be in violation of Sime Darby Plantation’s NDPE standards, the supplier would have to immediately cease work on the land.

He said the supplier must also develop two types of plan -- a time-bound plan for the restoration of cleared land and a time-bound plan to upgrade their operational practice.

"Suppliers that are unwilling to meet those conditions will be suspended,” he said.

Helmy said the development and execution of landscape restoration plans as well as operational improvement plans would be externally verified and monitored on an ongoing basis.

"The ultimate goal is to expand the sphere of oil palm companies operating to NDPE standards. Therefore, if a non-compliant supplier commits to meet Sime Darby Plantation’s conditions, the company will re-engage with them and support their progress,” he said.

He said constructive re-engagement to introduce new and improved practices is critical to systematically resolving non-compliance to NDPE.

"Simply suspending suppliers can have the unintended consequence of driving poor practice elsewhere into the system, making it less visible and harder to act on. This is not the intention of our policy,” he said.

Helmy said the company’s priority is to find solutions to the issues and this must be done via engagement with the suppliers and giving them the opportunity to redress the problem.

He added that the company is committed to working with suppliers in the development of their plans, and with non-governmental organisation partners to build capacity for operational improvements to raise suppliers’ NDPE compliance. - Bernama
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