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WWF Reactive Statement on PT SMART’s Announcement of Environmental Commitments for its Palm Oil Production

WWF issued the following statement in response to Indonesian palm oil giant PT SMART’s message to its customers of 4 February 2010 titled, “Announcement of PT SMART tbk’s commitments toward environmentally sustainable production of palm oil”.  (PT Smart’s message can be found at http://www.smart-tbk.com/announcement/100204_SMART_Announcement_to_Partners_026_English.pdf) :

“PT SMART, one of the Sinar Mas Group’s largest palm oil producers, has announced that from 4 February 2010 it has stopped converting primary forest and peat forest, as well as land of high conservation value. The palm oil industry and the pulp and paper industry are the primary drivers of forest loss in Indonesia and WWF cautiously welcomes this commitment by one of the largest palm oil producers in the country to change its practices and requests the commitment to be adopted by all of the Sinar Mas Group’s Agrobusiness, Food, and Forestry divisions.

 “WWF is also encouraged by PT SMART’s commitment to change its land acquisition practices to guarantee legal compliance and adopt the principle of ‘free, prior and informed consent,’ which could reduce human rights abuses and land tenure disputes with customary land holders and indigenous communities.

“While these announcements are a step forward, we would also like to see PT SMART commit to reducing carbon emissions from all land use changes and to limit any expansion of palm oil production to areas with carbon stocks less than 35 tons per hectare and to remediate peat areas and HCV areas that have not yet been planted.

“As PT SMART is a member of the Roundtable on Sustainable Palm Oil (RSPO), we also expect to see PT SMART publicly commit to RSPO certification for all of its palm oil operations and to make available a timeline for achieving this certification, as well as routinely informing progress against this timeline.”

“These commitments must now be applied and enforced vigorously and transparently on the ground across all of PT SMART’s concessions and its suppliers’ concessions for them to have any impact. WWF encourages PT SMART to swiftly put in place an external consultant acceptable to relevant stakeholders, including the RSPO, to serve as an independent auditor of these commitments and to produce that consultant’s terms of reference in collaboration with stakeholders and make the audit results available to the RSPO and to the public.”

“WWF urges existing and potential investors in and buyers of SMG’s Golden Agri and PT SMART to hold off any business engagements with SMG until the group has proven that its actions  match its commitments  through transparent, public, independent, third party verification acceptable to relevant stakeholders. “

However even with these changes to how Sinar Mas intends to operate in the future WWF also expects the Group to make reparations for what it has done in the past.  WWF requests that the Sinar Mas Group discloses the extent of its clearance of land including peat areas for oil palm production undertaken since November 2005 and without prior HCV assessment.  The Group should then offer adequate compensation for this infringement of the principles and criteria of the RSPO.  This compensation should be negotiated with the RSPO and should reflect the seriousness of the problems created by the Group.

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