Permata Hijau Group

Overall approach

7/10
- Overarching commitment on deforestation
  
  3/4
  
  Overall commitment
  
  Zero deforestation/Deforestation-free commitment or, for timber, pulp & paper companies only, commitment to well implemented harvest and no deforestation of HCV & HCS areas
  
  3/4
  
  "Commit to protect the environment by:Practicing zero deforestation and zero conversion of High Conservation Value (HCV) and High Carbon Stock (HCS) areas where all new development is preceded by HCV and HCS Assessment conducted by assessors accredited by HCVRN and HCSA"
  
  Open source document
- Signatory to an initiative tackling deforestation
  
  0/1
- Awareness of the value of forests
  
  1/1
  
  Awareness
  
  Yes
  
  1/1
  
  "Forests are one of the most important biome in the world and provide many important services to the environment: They are important carbon reservoirs. Permata Hijau fully appreciates the importance of conserving forest and therefore has committed to zero deforestation. Permata Hijau had not cleared any new land for oil palm cultivation since early 2000s. "
  
  Open source document
- Deforestation as a business risk
  
  1/1
  
  Business risk
  
  Yes
  
  1/1
  
  What proportion of revenue that comes from relevant industries is exposed to each forest risk commodity?: NA
  
  What revenue comes from industries relevant to each forest risk commodity?: NA
  
  What poportion of a company’s annual revenue depends on each forest risk commodity?: NA
  
  What type of risk is recognised?: Reputational
  
  "NDPE compliance can demonstrate the company’s sustainability progress, which would result in lower risk, better corporate reputation, access to a wider market and hopefully better prices. PHG is committed to NDPE and invites our suppliers to follow our steps."
  
  Open source document
- High-level management of deforestion
  
  1/1
  
  High-level management
  
  Yes
  
  1/1
  
  Which commodities does it apply to?: Palm oil
  
  How often does the committee or board meet to assess company's progress on addressing deforestation-related issues?: Not specified
  
  Permata Hijau Group have a diagram showing their sustainability governance which includes certification (in this instance it would RSPO for palm oil)
  
  Open source document
- Executive compensation linked to deforestation
- Target to reduce emissions from land-use change
  
  0/1
- Reporting on emissions from land-use change
  
  1/1
  
  Emissions reporting
  
  Yes
  
  1/1
  
  Which method is used to calculate the GHG emissions arising from land use change?: Records of land clearances
  
  What is the total volume of GHG emissions arising from land use change?: 0 tonnes
  
  "Our land use change emission is calculated to be zero because we had not cleared any new land for oil palm cultivation since early 2000s."
  
  Open source document
- Disclosure of conservation activity
- Disclosure of reforestation activity
  
  Reforestation disclosure
  
  Yes
  
  0/0
  
  How many hectares of reforestation or restoration are being or have been conducted or facilitated by the company?: 60 ha
  
  In 2021: "Permata Hijau Group (PHG) is partnering with Yayasan Leuser Internasional (YLI) in a program to rehabilitate degraded land in Desa Tingkem Bersatu and Desa Tingkem Asli, Kecamatan Bukit, Kabupaten Bener Meriah, Aceh, Indonesia.The rehabilitation program aims to restore 60 ha (hectare) of degraded and burnt land by planting 8,000 coffee plants and hardwood trees such as avocado, mindi, lekap, kesemek and kerto that serves as shade, water storage and erosion prevention. The program will also provide job opportunities for 52 local coffee farmers."
  
  Open source document
- Target to reduce emissions in scope 1/2
Commodity score

33/90
- Palm oil
  
  33/90
  - Commitment Strength
    
    14/17
    - Commodity-specific deforestation commitment
      
      4/4
      - Commitment applies to all regions, suppliers and operation
        Yes
        
        2/2
        
        Commitment applies to all regions, suppliers and operation
        
        Yes
        
        2/2
        
        "Commit to protect the environment by: Practicing zero deforestation and zero conversion of High Conservation Value (HCV) and High Carbon Stock (HCS) areas where all new development is preceded by HCV and HCS Assessment conducted by assessors accredited by HCVRN and HCSA...Managing High Conservation Value (HCV) areas identified within the concession and protect its natural function and biodiversity"[...]"We will protect the environment surrounding our operations...we will not establish new plantations on peat land of any depth. Existing plantation on peat will be managed in accordance with RSPO’s Best Management Practices... we will implement RSPO’s Best Management Practices in managing our soils"
        
        Open source document
        Open source document
      - Target date
        Current/achieved
        
        1/1
        
        Target date
        
        Current/achieved
        
        1/1
        
        What actions or steps are identified for time-bound implementation?: RSPO Certification
        
        "Commit to protect the environment by: Practicing zero deforestation and zero conversion of High Conservation Value (HCV) and High Carbon Stock (HCS) areas where all new development is preceded by HCV and HCS Assessment conducted by assessors accredited by HCVRN and HCSA...Managing High Conservation Value (HCV) areas identified within the concession and protect its natural function and biodiversity"[...]"We will protect the environment surrounding our operations...we will not establish new plantations on peat land of any depth. Existing plantation on peat will be managed in accordance with RSPO’s Best Management Practices... we will implement RSPO’s Best Management Practices in managing our soils"
        
        Open source document
        Open source document
      - Interim target date
        NA (target date current or achieved or 2023)
        
        0.5/0.5
        
        Interim target date
        
        NA (target date current or achieved or 2023)
        
        0.5/0.5
        
        What date is given for the interim milestone?: NA
        
        "Commit to protect the environment by: Practicing zero deforestation and zero conversion of High Conservation Value (HCV) and High Carbon Stock (HCS) areas where all new development is preceded by HCV and HCS Assessment conducted by assessors accredited by HCVRN and HCSA...Managing High Conservation Value (HCV) areas identified within the concession and protect its natural function and biodiversity"[...]"We will protect the environment surrounding our operations...we will not establish new plantations on peat land of any depth. Existing plantation on peat will be managed in accordance with RSPO’s Best Management Practices... we will implement RSPO’s Best Management Practices in managing our soils"
        
        Open source document
        Open source document
    - Commitment to a traceable supply chain
      
      7/7.5
      - Commitment details
        Traces to Point of production
        
        4/4
        
        Commitment to a traceable supply chain
        
        Traces to Point of production
        
        4/4
        
        When was this commitment set?: NA
        
        "we adopt a two tiered approach to traceability:Tier one: Traceability to the Palm oil millTier two: Traceability to the Plantation [...] We have managed to trace 100% of our oil and kernel to its mill of origin. [...] we aim to achieve 100% traceability to plantation by 2025."
        
        Open source document
      - Commitment applies to all regions, suppliers and operation
        Yes
        
        2/2
        
        Commitment applies to all regions, suppliers and operation
        
        Yes
        
        2/2
        
        "we adopt a two tiered approach to traceability:Tier one: Traceability to the Palm oil millTier two: Traceability to the Plantation [...] We have managed to trace 100% of our oil and kernel to its mill of origin. [...] we aim to achieve 100% traceability to plantation by 2025."
        
        Open source document
      - Target date
        2025
        
        0.8/1
        
        Target date
        
        2025
        
        0.8/1
        
        What actions or steps are identified for time-bound implementation?: 1 Traceability to mill (achieved). 2 traceability to plantation by 2025
        
        "we adopt a two tiered approach to traceability:Tier one: Traceability to the Palm oil millTier two: Traceability to the Plantation [...] We have managed to trace 100% of our oil and kernel to its mill of origin. [...] we aim to achieve 100% traceability to plantation by 2025."
        
        Open source document
      - Interim target date
        No
        
        0/0.5
  - Associated Human Rights Abuses
    
    6/17
    - Labour rights in the supply chain
      Yes
      
      3/3
      
      Labour rights in the supply chain
      
      Yes
      
      3/3
      
      Other workers' rights commitments: Living wage; Guaranteed safe and healthy workspaces
      
      Details of commitment: UN Declaration for HR; Discrimination; Forced labour; Child labour; Freedom of association
      
      How far back in the supply chain does this commitment apply?: Tier 1
      
      "We will respect the human rights (as per the definition of UN declaration of Human Rights) of the people we work or interact with as well as people who are impacted by our operations. These include our workers, local communities and human rights defenders...We will respect the freedom of choice of our workers. We will not employ forced labor and child labor...We will compensate all of our workers with at least the minimum wage and will strive to provide decent living wage...We will respect the rights of our workers to join trade unions or to collectively bargain with us...We will provide a safe and healthy working environment for our workers...We will comply with all national and local laws and regulations as well as the core ILO conventions regarding labor and health and safety"
      
      Open source document
    - Inclusion of small-scale farmers
      No
      
      0/2
    - Gender equality in the supply chain
      Commitment to address gender related labour rights including discrimination and harassment
      
      1/2
      
      Gender equality in the supply chain
      
      Commitment to address gender related labour rights including discrimination and harassment
      
      0.5/2
      
      "Practicing zero tolerance towards any type of harassment, abuse, or discrimination (gender, race, age, etc.) related to employment and occupation within the company’s premises."[...]"Supplier Sustainability Code"
      
      Open source document
    - Commitment to remediation
      No
      
      0/1
    - Commitment to test Free, Prior and Informed Consent
      Yes, the company commits to test for FPIC prior to acquiring new interests, developments, or expansions
      
      2/3
      
      Commitment to test Free, Prior and Informed Consent
      
      Yes, the company commits to test for FPIC prior to acquiring new interests, developments, or expansions
      
      2/3
      
      How far back in the supply chain does this commitment apply?: Tier 1
      
      "We will follow the principles of Free, Prior and Informed Consent (FPIC) in our dealings with the communities. We will respect the right of local communities to give or withhold consent to the land to which they hold legal, communal or customary rights or tenures"
      
      Open source document
    - Commitment to respect customary rights to land, resources, and territory
      No
      
      0/3
    - Zero-tolerance approach to violence and threats
      No
      
      0/3
  - Implementation and Reporting
    
    13/56
    - Reporting proportion of compliant volumes
      
      0/0
    - Reporting is independently verified
      No
      
      0/2
    - Suppliers aligned with deforestation commitments across supply chain
      Yes, encouraged
      
      0/3
      
      Suppliers aligned with deforestation commitments across supply chain
      
      Yes, encouraged
      
      0/3
      
      "We invite our suppliers to join us in this journey by signing up to the following commitments: Practicing zero deforestation and zero conversion of High Conservation Value (HCV) and High Carbon Stock (HCS) areas where all new development is preceded by HCV and HCS Assessment conducted by assessors accredited by HCVRN and HCSA [...] Practicing zero new planting on peatland and managing existing plantation on peat in accordance with RSPO’s Best Management Practices"
      
      Open source document
    - Deforestation cut off date
      No
      
      0/2
    - Collaborative actions
      Yes
      
      2/2
      
      Collaborative actions
      
      Yes
      
      2/2
      
      What is the nature of that participation?: Providing support/ advice/ experience/ expertise
      
      What initiatives does the company participate in?: supplier workshop on NDPE
      
      "11 March 2020:Permata Hijau Group (PHG), in partnership with Cargill and CORE held its first supplier workshop in JW Marriott Hotel, Medan. The workshop aimed to communicate to PHG suppliers the importance of sustainability and transparency and to introduce the updated sustainability/ NDPE policy of PHG as well as PHG’s new supplier code. The event was attended by more than 50 participants."
      
      Open source document
    - Jurisdictional approach focused on sustainable land use
      No
      
      0/2
    - Risk assessments for forest risk
      Yes
      
      2/2
      
      Risk assessments for forest risk
      
      Yes
      
      2/2
      
      For what percentage of material produced or sourced by the company has forest risk been assessed?: NA
      
      How frequently are assessments conducted?: NA
      
      "Permata Hijau fully appreciates the importance of conserving forest and therefore has committed to zero deforestation. Permata Hijau had not cleared any new land for oil palm cultivation since early 2000s. However, if we ever need to clear new land for new oil palm development, we will engage qualified and registered assessors to conduct HCV-HCS assessments and will plan our expansion following recommendations outlined in our HCV-HCS assessments."
      
      Open source document
    - Operations assessed to comply with law
      No
      
      0/2
    - Accessible grievance mechanism
      Yes, publicly accessible grievance mechanism
      
      2/4
      
      Accessible grievance mechanism
      
      Yes, publicly accessible grievance mechanism
      
      2/4
      
      Which issues does the grievance mechanism cover?: Social; Environmental
      
      What is the nature of the grievance mechanism used by the company?: Own mechanism
      
      "Permata Hijau invites stakeholders to lodge any grievances and complaints through our grievance and complaint system. The grievances and complaints will be processed in a timely manner following the flowchart below: List of Grievances and Complaints can be found here [link is broken]. Grievances and complaints can be delivered through the following channels:grievance@permatagroup.com+62-61-4577777+62-61-4569755Attn: Grievance and Complaint Team Jl. Iskandar Muda No.107 Medan, 20154 Indonesia"
      
      Open source document
    - Report volumes of commodity sourced/used
      Reporting total volume
      
      3/3
      
      Report volumes of commodity sourced/used
      
      Reporting total volume
      
      3/3
      
      Reporting certified/compliant volume: 0 Metric Tonnes
      
      Total volume: 1570000 Metric Tonnes
      
      Reporting non-certified/non-compliant volume: 1570000 Metric Tonnes
      
      What product types/sectors is this in?: NA
      
      What is the non-DCF commodity volume sourced from known production areas, and proportion of total supply chain volume this represents?: NA
      
      In their 2020 RSPO ACOP Report Permata Hijau Group report they consumed 1570000 Metric Tonnes of palm oil that year, 0% of which was RSPO Certified.
      
      Open source document
    - Monitor compliance for labour rights and FPIC
      No
      
      0/5
    - Monitor compliance for zero tolerance approach and customary rights
      No
      
      0/5
    - Upstream: Impact assessments for land development/acquisition
      No
      
      0/4
    - Upstream: Reporting production/processing locations
      Reports location of company-owned processing facilities
      
      1/4
      
      Upstream: Reporting production/processing locations
      
      Reports location of company-owned processing facilities
      
      1/4
      
      For what percent are boundaries (of holdings under conservation) disclosed?: NA
      
      What is the total area in production (in ha)?: 13000ha
      
      What is the total area (in ha) of natural ecosystem on land owned, managed, or controlled by the company?: NA
      
      For what percent are point locations (of land holdings and processing facilities) disclosed: 0%
      
      For what percent are point locations (of holdings under conservation) disclosed?: 0%
      
      What is the area, in hectares of production units, on which non-DCF commodities are produced or processed, by country and jurisdiction: NA
      
      In what jurisdiction(s)/subnational region does the company operate and/or source material?: North Sumatra ; Riau
      
      In what country(ies) does the company operate and/or source material?: Indonesia
      
      From what sub-national jurisdiction(s) does the company source material?: NA
      
      What is the total area of land (in ha) that is available for future production, e.g. concessions?: NA
      
      What type of conservation designation and/or conservation status is used?: NA
      
      What types of ecosystems are these?: NA
      
      What is the volume of each forest risk commodity that the company produced/processed/sourced in the previous year from each national or subnational location?: NA
      
      What is the total land area owned, managed, or controlled by the company for the forest risk commodity?: NA
      
      For what percent are boundaries disclosed?: 0%
      
      For what percent are boundaries (of certified land holdings) disclosed?: 0%
      
      For what percent are point locations (of certified land holdings) disclosed?: 0%
      
      As of April 1st 2021 Permata Hijau Group had 13000ha of planted area and 3400ha of smallholder planted area with processing facilities in North Sumatra and Riau.
      
      Open source document
      Open source document
    - Downstream: Reporting suppliers
      No
      
      0/4
    - Upstream: Monitor compliance of production/processing
      No
      
      0/4
    - Upstream: Reporting hectares of deforestation
      No
      
      0/4
    - Downstream: Monitor compliance in supply chain
      Yes, for its suppliers
      
      2/4
      
      Downstream: Monitor compliance in supply chain
      
      Yes, for its suppliers
      
      2/4
      
      How is compliance monitored?: Internal monitoring and verification systems
      
      For what percentage of suppliers does the company use/rely on external mechanisms to monitor compliance?: NA
      
      For what percentage of the commodity sourced by the company is deforestation/conversion monitored at the farm level on production units known to be in the company's supply chain?: NA
      
      For what percent of suppliers does the company directly monitor compliance of production or processing operations?: NA
      
      What percentage of the company's supply chain volume does that represent?: NA
      
      How frequently is compliance assessed?: NA
      
      "We will commence a thorough review of our supplier list to ensure full transparency so that we will not have any more commercial relationship with problematic companies. The result of the review will be reflected in our updated supplier list."
      
      Open source document
    - Downstream: Reporting hectares of deforestation
      No
      
      0/4
    - Downstream: Engagement with non-compliant suppliers
      Blacklist non-compliant suppliers without engagement
      
      1/2
      
      Downstream: Engagement with non-compliant suppliers
      
      Blacklist non-compliant suppliers without engagement
      
      1/2
      
      What criteria does the policy specify for blacklisting or exclusion?: Undertaking deforestation
      
      What type of support does the company offer to its suppliers to help them achieve compliance with commitments?: NA
      
      Does the company engage non-compliant indirect suppliers in order to address and remedy non-compliance?: No
      
      Does the company commit to engage with rightsholders, Indigenous peoples and local communities when developing the implementation plan?: No
      
      Does the company work with the non-compliant supplier to develop an implementation plan to remedy associated harms or non-compliance?: No
      
      "Moving forward, we have ceased all commercial relationship with PT. Kallista Alam with immediate effect on 10 June 2020.In addition to ceasing relationship with PT. Kallista Alam, we will do the following steps:We will commence an investigation into how this oversight happened so that it will not happen again in the future.We will commence a thorough review of our supplier list to ensure full transparency so that we will not have any more commercial relationship with problematic companies. The result of the review will be reflected in our updated supplier list.We will create a regularly updated list of non-compliant suppliers to guide us in our purchasing and socialise it to our procurement team.We will increase training for our procurement team on sustainability and traceability.We will engage our suppliers located around Leuser ecosystem to educate and support them on their sustainability."
      
      Open source document
    - Downstream: Disclosure of non-compliant suppliers
      Yes, engaged; Yes, excluded
      
      2/2
      
      Downstream: Disclosure of non-compliant suppliers
      
      Yes, engaged; Yes, excluded
      
      2/2
      
      Does the company have a list of blacklisted or otherwise excluded suppliers or producers?: No
      
      How many noncompliant producers or suppliers are engaged through improvement plans or other processes, and what percentage of the company's supply chain volume does that represent?: NA
      
      PHG have a list of grievances and complaints against suppliers for the period from 2018 to 2021 including companies those they have engaged and excluded.
      
      Open source document
Commitment strength

14/17

Avg. score
Implementation and Reporting

13/56

Avg. score
Associated Human Rights Abuses

6/17

Avg. score

Profile

The Permata Hijau Group (PHG) is a palm oil company that has operations across the entire palm oil supply chain from cultivating to manufacturing and distribution. Its products include crude palm oil, oleochemicals, biodiesel, specialty fats and cooking oil. PHG is one of the top five importers and exporters of palm oil in Indonesia and is among the top ten importers of palm oil into China. Permata Hijau Group is selected as a powerbroker for palm oil.

Sector

Industry sector

Agricultural Products, Packaged Foods & Meats

Segments

Producer, Trader, Processor, Manufacturer

Indonesia

Company Type

Company type

Collective Commitments

Consumer Goods Forum member

New York Declaration on Forests signatory

How we assess the Forest 500

To ensure deforestation free supply chains, companies need to adopt and implement timebound and measurable policies for forest risk commodities.

All assessments use policies published on company websites, some links may have changed or been removed since the time of assessment.

Full corporate sector performance data Forest 500 assessment methodology

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Disclaimer

This assessment has been carried out following the methodology developed for the Forest 500 project, available here. Please see our disclaimer applicable to all information contained within this site and our terms and conditions for use of data presented on this site.

All assessments use policies published on company and financial institution websites, and while we endeavor to keep them updated some links may have changed or been removed since the time of assessment.

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