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  • Overall approach
    3/12
    • Overarching commitment on deforestation
      0/4
    • Signatory to an initiative tackling deforestation
      0/1
    • Awareness of the value of forests
      1/1
      Yes
      1/1
      "Because of the vital social and environmental functions of forests, Perhutani is not only expected to pursue profitability, it must also build forest and environmental conservation as well as contributing to the prosperity of communities in forested areas".
    • Deforestation as a business risk
      1/1
      Yes
      1/1
      Does the company recognise the risk as financial, operational, competition, reputational, or other? Please detail.: All
      “Management of the Company as a business entity based on forest resources is aligned to maintain balance between the Company’s growth (Profit), Forest Resources conservation(Planet) and welfare of the society (People). [...] Perhutani is a Company based on Forest Management, every of its activity prioritizes forest resources management, the forest resources conservation will also preserve Perhutani as a company. [...] It becomes a duty of Perhutani to be committed in preserving forest resources and environment conservation in the area under the Company’s management and its neighborhood.”
    • High-level management of deforestion
      1/1
      Yes
      1/1
      Which commodities does it apply to?: Timber
      The company has supervisory boards and audit committees who regularly assess the company as a whole against all of it's policies and commitments, including against FSC or certified wood (environmental) . "As means of transparency, Supervisory Board had performed supervisory and controlling processes in the Company throughout 2018 according to our roles and functions to answer challenge, needs and expectations of the stakeholders through review and evaluation on the Company’s performance and operations, both in terms of operational and financial performance. The Supervisory Board also encourages the Board of Directors to continuously innovate to ensure achievement of the designated work program and performance target."
    • Executive compensation linked to deforestation
    • Target to reduce emissions from land-use change
      0/2
    • Reporting on emissions from land-use change
      0/2
    • Disclosure of conservation activity
    • Disclosure of reforestation activity
      Yes
      0/0
      Within the 2018 annual report - “Perhutani plants averagely 75 million tree seeds every year to revitalize the forest. In 2018, the planting realization is 101% exceeding the target, Perhutani realized the planting of more than 70 million tree seeds for a 44,586 ha forest land area and maintaining 148 thousand hectares of trees, with total budget of Rp182 billion.”
    • Target to reduce emissions in scope 1/2
  • Commodity score
    31/88
    • Timber
      31/88
      • Commitment Strength
        4/20
        • Commitment to protect priority forests
          4/11
          • Commitment details
            Credible certification scheme
            2.7/8
            Commitment to protect priority forests
            Credible certification scheme
            2.7/8
            Which certification schemes are used?: FSC
            "Perum Perhutani is a state-owned company assigned by the state to manage production forests and protected forests in the provinces of Central Java, East Java, West Java and Banten. Perum Perhutani has 57 KPHs in an effort to realize sustainable forest management. Perhutani's achievements in managing forests sustainably are manifested in its certificates, including PHPL, FSC Forest Management and FSC Controlled Wood. The FSC Controlled Wood certificate ensures that Perhutani is a provider of wood raw materials that do not come from unacceptable sources. Since 2014 Perum Perhutani has pocketed a certificate with the number SGS-CW / FM-010314 which is valid in 49 Forest Management Units for a period of 5 years with annual surveillance. In 2020, the first surveillance audit will be carried out for the second certificate period on August 24, 2020. This FSC Controlled Wood audit uses the FSC-STD-30-010.v2 en FSC Controlled Wood Standard for Forest Management Enterprise standard. This standard requires Perum Perhutani to: (1) not produce timber from illegal logging; (2) Not violating civil rights and traditional rights; (3) Minimizing damage to areas of high conservation value; (4) Do not convert natural forest (primary / secondary); (5) Not carrying out forest management with transgenic plants."; They were re-awarded their FSC certification again in 2020
          • Commitment applies to all regions, suppliers and operation
            No
            0/2
            Commitment applies to all regions, suppliers and operation
            No
            0/2
            If no, what is excluded?: Location
            "Perum Perhutani is a state-owned company assigned by the state to manage production forests and protected forests in the provinces of Central Java, East Java, West Java and Banten. Perum Perhutani has 57 KPHs in an effort to realize sustainable forest management. Perhutani's achievements in managing forests sustainably are manifested in its certificates, including PHPL, FSC Forest Management and FSC Controlled Wood. The FSC Controlled Wood certificate ensures that Perhutani is a provider of wood raw materials that do not come from unacceptable sources. Since 2014 Perum Perhutani has pocketed a certificate with the number SGS-CW / FM-010314 which is valid in 49 Forest Management Units for a period of 5 years with annual surveillance. In 2020, the first surveillance audit will be carried out for the second certificate period on August 24, 2020. This FSC Controlled Wood audit uses the FSC-STD-30-010.v2 en FSC Controlled Wood Standard for Forest Management Enterprise standard. This standard requires Perum Perhutani to: (1) not produce timber from illegal logging; (2) Not violating civil rights and traditional rights; (3) Minimizing damage to areas of high conservation value; (4) Do not convert natural forest (primary / secondary); (5) Not carrying out forest management with transgenic plants."; They were re-awarded their FSC certification again in 2020
          • Target date
            Current/achieved
            1/1
            Target date
            Current/achieved
            1/1
            "Perum Perhutani is a state-owned company assigned by the state to manage production forests and protected forests in the provinces of Central Java, East Java, West Java and Banten. Perum Perhutani has 57 KPHs in an effort to realize sustainable forest management. Perhutani's achievements in managing forests sustainably are manifested in its certificates, including PHPL, FSC Forest Management and FSC Controlled Wood. The FSC Controlled Wood certificate ensures that Perhutani is a provider of wood raw materials that do not come from unacceptable sources. Since 2014 Perum Perhutani has pocketed a certificate with the number SGS-CW / FM-010314 which is valid in 49 Forest Management Units for a period of 5 years with annual surveillance. In 2020, the first surveillance audit will be carried out for the second certificate period on August 24, 2020. This FSC Controlled Wood audit uses the FSC-STD-30-010.v2 en FSC Controlled Wood Standard for Forest Management Enterprise standard. This standard requires Perum Perhutani to: (1) not produce timber from illegal logging; (2) Not violating civil rights and traditional rights; (3) Minimizing damage to areas of high conservation value; (4) Do not convert natural forest (primary / secondary); (5) Not carrying out forest management with transgenic plants."; They were re-awarded their FSC certification again in 2020
          • Interim target date
            NA (target date current or achieved or 2022)
            0.5/0.5
            Interim target date
            NA (target date current or achieved or 2022)
            0.5/0.5
            "Perum Perhutani is a state-owned company assigned by the state to manage production forests and protected forests in the provinces of Central Java, East Java, West Java and Banten. Perum Perhutani has 57 KPHs in an effort to realize sustainable forest management. Perhutani's achievements in managing forests sustainably are manifested in its certificates, including PHPL, FSC Forest Management and FSC Controlled Wood. The FSC Controlled Wood certificate ensures that Perhutani is a provider of wood raw materials that do not come from unacceptable sources. Since 2014 Perum Perhutani has pocketed a certificate with the number SGS-CW / FM-010314 which is valid in 49 Forest Management Units for a period of 5 years with annual surveillance. In 2020, the first surveillance audit will be carried out for the second certificate period on August 24, 2020. This FSC Controlled Wood audit uses the FSC-STD-30-010.v2 en FSC Controlled Wood Standard for Forest Management Enterprise standard. This standard requires Perum Perhutani to: (1) not produce timber from illegal logging; (2) Not violating civil rights and traditional rights; (3) Minimizing damage to areas of high conservation value; (4) Do not convert natural forest (primary / secondary); (5) Not carrying out forest management with transgenic plants."; They were re-awarded their FSC certification again in 2020
        • Commitment to a traceable supply chain
          0/9
          • Commitment details
            No traceability commitment
            0/5.3
          • Commitment applies to all regions, suppliers and operation
            No
            0/2
          • Target date
            No target date
            0/1
          • Interim target date
            No
            0/0.5
      • Social Considerations
        9/18
        • Labour rights in the supply chain
          Yes
          4/4
          Labour rights in the supply chain
          Yes
          4/4
          Details of commitment: Discrimination; Forced labour; Child labour; Freedom of association
          "Respect employee performance and achievements without discriminating against race, religion, gender or employee status. [...] In addition, Perhutani requires every contractor and supplier, as our partners, to always comply with employment regulations and prevailing safety, health and environmental standards in Perhutani. In addition, we firmly reject existence of any means of forced and child labors [...] Freedom To UniteAccording to the mandate disclosed in Law No.13 of 2003 on Employment, and Minister of Manpower and Transmigration Decree No. Kep 255/Men/2003 concerning Bipartite LKS Establishment Procedure and Membership Composition, Perhutani has a Collective Labor Agreement (CLA) that is prepared altogether with the workers union and reviewed regularly every two year." 
        • Inclusion of small-scale farmers
          Yes
          4/4
          Inclusion of small-scale farmers
          Yes
          4/4
          What is the nature of that support?: Economic
          "Partnership Program funds disbursement mechanism is regulated as follows: • Prospective partner submits loans application proposal • Proposal selection • Executor unit will next perform field survey/ checking to the • After all requirements have been fulfilled, Decree from local Unit/Area will be issued concerning the loans application approval • Pursuant to Decree from the local Unit/Area, disbursement for the partner who is approved to obtain loans will be governed in an Agreement Letter/Contract as commitment. Criteria of Perhutani’s partnership program loans disbursement target for small and medium enterprises is small-scale public economy activity, with net assets maximum of Rp500 million (excluding land and building) or annual revenues maximum Rp2.5 billion and the business activity has been operated minimum for 1 year and has business potential and prospect that is productive to be developed. Meanwhile, institutional or individual targets who will be prioritized are: • Forest Rural Community Organization (LMDH) • LMDH Coopratives Business Entity • LMDH or members of LMDH (has obtained PKBL loans, with potential to develop fertilizer manufacturing and procurement, cultivation and other businesses that support business of Perhutani • Perhutani Foreman Family (having productive business, not member of LMDH)."
        • Gender equality in the supply chain
          Commitment to address gender related labour rights including discrimination and harassment
          1/4
          Gender equality in the supply chain
          Commitment to address gender related labour rights including discrimination and harassment
          1/4
          "Respect employee performance and achievements without discriminating against race, religion, gender or employee status. [...]"
        • Commitment to remediation
          No
          0/2
        • Commitment to ensure Free, Prior and Informed Consent
          No
          0/4
        • Commitment to resolve land conflicts
          No
      • Reporting and Implementation
        18/50
        • Reporting against commitments
          0/3
          • Commitment to protect priority forests
            Yes, for all commodity exposure
            2.5/2.5
            Commitment to protect priority forests
            Yes, for all commodity exposure
            2.5/2.5
            Does the company report on the degree of compliance/progress with commitments, disaggregated by relevant factors such as origin or supply chain stage?: Yes
            "Perum Perhutani is a state-owned company assigned by the state to manage production forests and protected forests in the provinces of Central Java, East Java, West Java and Banten. Perum Perhutani has 57 KPHs in an effort to realize sustainable forest management. Perhutani's achievements in managing forests sustainably are manifested in its certificates, including PHPL, FSC Forest Management and FSC Controlled Wood. The FSC Controlled Wood certificate ensures that Perhutani is a provider of wood raw materials that do not come from unacceptable sources. Since 2014 Perum Perhutani has pocketed a certificate with the number SGS-CW / FM-010314 which is valid in 49 Forest Management Units for a period of 5 years with annual surveillance. In 2020, the first surveillance audit will be carried out for the second certificate period on August 24, 2020. This FSC Controlled Wood audit uses the FSC-STD-30-010.v2 en FSC Controlled Wood Standard for Forest Management Enterprise standard. This standard requires Perum Perhutani to: (1) not produce timber from illegal logging; (2) Not violating civil rights and traditional rights; (3) Minimizing damage to areas of high conservation value; (4) Do not convert natural forest (primary / secondary); (5) Not carrying out forest management with transgenic plants."; They were re-awarded their FSC certification again in 2020
          • Commitment to a traceable supply chain
            No
            0/2.5
        • Reporting is independently verified
          2/2
          • Commitment to protect priority forests
            Yes, using a third-party verification scheme or certification scheme.
            1.5/1.5
            Commitment to protect priority forests
            Yes, using a third-party verification scheme or certification scheme.
            1.5/1.5
            Which processes or groups does the company use for third party verification?: FSC

            Which tools, approaches, third-party verification, including certification, schemes are used?: FSC
            "Perum Perhutani is a state-owned company assigned by the state to manage production forests and protected forests in the provinces of Central Java, East Java, West Java and Banten. Perum Perhutani has 57 KPHs in an effort to realize sustainable forest management. Perhutani's achievements in managing forests sustainably are manifested in its certificates, including PHPL, FSC Forest Management and FSC Controlled Wood. The FSC Controlled Wood certificate ensures that Perhutani is a provider of wood raw materials that do not come from unacceptable sources. Since 2014 Perum Perhutani has pocketed a certificate with the number SGS-CW / FM-010314 which is valid in 49 Forest Management Units for a period of 5 years with annual surveillance. In 2020, the first surveillance audit will be carried out for the second certificate period on August 24, 2020. This FSC Controlled Wood audit uses the FSC-STD-30-010.v2 en FSC Controlled Wood Standard for Forest Management Enterprise standard. This standard requires Perum Perhutani to: (1) not produce timber from illegal logging; (2) Not violating civil rights and traditional rights; (3) Minimizing damage to areas of high conservation value; (4) Do not convert natural forest (primary / secondary); (5) Not carrying out forest management with transgenic plants."; They were re-awarded their FSC certification again in 2020
          • Commitment to a traceable supply chain
            No
            0/1.5
        • Suppliers aligned with deforestation commitments across supply chain
          No
          0/2
        • Deforestation cut off date
          No
          0/2
        • Collaborative actions
          No
          0/2
        • Risk assessments for forest risk
          No
          0/2
        • Operations assessed to comply with law
          Yes
          2/2
          Operations assessed to comply with law
          Yes
          2/2
          "Prioritize compliance and understanding of laws and regulations and heeding the prevailing norms in society including considering the best practices, which are deemed necessary and important to be done (Duty Abiding the Laws). [...] Understanding on Internal Control System in Perhutani is done continuously by Executives in the Company and all employees to provide sufficient assurance on achievement of the Company’s organization through effectiveness and efficiency of implementation goals achievements from the program and activity that are carried out by the Company, reliability of the prepared financial and performance reporting, and compliance with prevailing law and regulation."
        • Accessible grievance mechanism
          Yes, and published details of any grievances within the last two years (2019-2021)
          4/4
          Accessible grievance mechanism
          Yes, and published details of any grievances within the last two years (2019-2021)
          4/4
          Does the company publish grievances that have been made against it, as well as responses and resolutions including status and timeframes: Yes

          Which issues does the grievance mechanism cover?: Social; Environmental

          What is the nature of the grievance mechanism used by the company (own mechanism, that of external company, internationally recognised mechanism, etc.)?: Own
          [translation] "Welcome to Perum Perhutani's Whistle Blowing System ServiceAre you aware of any violations against the law, company ethics ( Code of Conduct ) and company regulations?Please report !!Through Perhutani's WBS media.The Whistle Blowing System (WBS) or violation reporting system is a system that manages complaints / disclosures regarding violations of illegal behavior and unethical / improper actions that are kept confidential and protects the identity of the complainant."
        • Report volumes of commodity
          Reporting total volume
          2/2
          Report volumes of commodity
          Reporting total volume
          2/2
          Total/partial volume reported: 1,410,422 m3
          In 2019 1,410,422 m3 of products 
        • Report verified volumes of commodity
          Some disclosure of compliant commodity/unclear % of volume/no verification of reporting
          1/6
          Report verified volumes of commodity
          Some disclosure of compliant commodity/unclear % of volume/no verification of reporting
          1/6
          What is the certified volume?: 1,410,422 m3

          What third-party verification is used?: FSC 
          They are FSC certified but it is unclear to what degree.
        • Upstream: Monitor compliance with human rights
          Yes, commit to monitoring compliance with labour/worker rights
          2/4
          Upstream: Monitor compliance with human rights
          Yes, commit to monitoring compliance with labour/worker rights
          2/4
          "Respect employee performance and achievements without discriminating against race, religion, gender or employee status. [...] In addition, Perhutani requires every contractor and supplier, as our partners, to always comply with employment regulations and prevailing safety, health and environmental standards in Perhutani. In addition, we firmly reject existence of any means of forced and child labors [...] Freedom To UniteAccording to the mandate disclosed in Law No.13 of 2003 on Employment, and Minister of Manpower and Transmigration Decree No. Kep 255/Men/2003 concerning Bipartite LKS Establishment Procedure and Membership Composition, Perhutani has a Collective Labor Agreement (CLA) that is prepared altogether with the workers union and reviewed regularly every two year. [...] Understanding on Internal Control System in Perhutani is done continuously by Executives in the Company and all employees to provide sufficient assurance on achievement of the Company’s organization through effectiveness and efficiency of implementation goals achievements from the program and activity that are carried out by the Company, reliability of the prepared financial and performance reporting, and compliance with prevailing law and regulation."
        • 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
          In what country(ies) does the company operate and/or source material?: Indonesia 

          In what jurisdiction(s)/subnational region does the company operate and/or source material?: East Java, Central Java, West Java, Banten

          What is the total area in production (in ha)?: 2.566.889 ha
        • Downstream: Publishing supplier lists
          No
          0/4
        • Upstream: Monitor compliance of production/processing
          Yes, using an internal verification system
          4/4
          Upstream: Monitor compliance of production/processing
          Yes, using an internal verification system
          4/4
          Does the company use a jurisdictional monitoring mechanism?: No

          How frequently is compliance assessed?: Not specified

          Does the company use a certification system?: No
          Company uses internal auditing and CSR committee monitoring throughout it's operations. "In environmental aspect, the Company has conducted CSR activity to conserve the environment, altogether with the Government, the Company also monitors activities of the Company in this aspect related to environmental conservation, media as the Company’s channel to disclose and report CSR activities that have been implemented or planned to be conducted by the Company. Regulatory"
        • Upstream: Reporting hectares of deforestation
          No
          0/4
        • Downstream: Monitor compliance in supply chain
          No
          0/4
        • Downstream: Reporting hectares of deforestation
          No
          0/4
        • Downstream: Engagement with non-compliant suppliers
          No engagement or exclusion
          0/2
        • Downstream: Disclosure of non-compliant suppliers
          No disclosure
          0/2
  • Commitment strength
    4/20
    Avg. score
  • Reporting and Implementation
    18/50
    Avg. score
  • Social considerations
    9/18
    Avg. score

Profile

Perum Perhutani is a state-owned enterprise, which manages the state forests in Java and Madua, Indonesia. The total area covers over 2.4 million hectares. Perum Perhutani is selected as a powerbroker for timber.

Sector
Industry sector 
Forestry
Segments
Producer, Trader, Processor
HQ
HQ 
Indonesia
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.

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.

Please contact us with any concerns or feedback about this or other assessments included in the Forest 500.