Palm oil company PT Smart refutes deforestation claims

Grace Chua Straits Times 21 Aug 10;

PT SMART, part of Singapore-listed Golden Agri-Resources, has again rejected allegations of illegal forest clearing after foreign auditors suggested it had misrepresented the findings of an independent investigation.

The Indonesian palm oil producer had commissioned the audit to clear its name after environmental group Greenpeace repeatedly alleged that it had destroyed orang-utan habitat and cleared forests without permits, among other charges.

In response to the Greenpeace reports, major palm oil buyers such as Unilever, Kraft and Nestle had earlier stopped buying palm oil from Golden Agri.

On Aug 10, the audit report conducted by British-based BSI Group was released in full, along with a PT Smart press release and presentation.

But on Thursday, BSI issued a statement claiming that some of the audit's findings had been 'misreported as it has been published and presented'.

BSI had done the report with international certification firm Control Union Certification and Indonesian forestry experts. While it did not state explicitly what was misreported, some audit findings were not included in the PT Smart presentation and press release.

For example, the audit mentioned the need for PT Smart to further study its social impact on local communities, and that loopholes in Roundtable on Sustainable Palm Oil (RSPO) rules might allow complex organisations to 'greenwash' their operations - the environmental equivalent of a whitewash.

In response, PT Smart pointed out that it had released the full report on its website and in stock exchange filings.

The independent report found PT Smart was not responsible for forest burning and destroying orang-utan habitat. It found palm oil planting on deep peat - an important carbon sink - but not as extensively as Greenpeace had alleged. A carbon sink is an area that accumulates and stores carbon.

On Thursday, Greenpeace said BSI's statement vindicated its claims.

Greenpeace has also written to the Singapore Stock Exchange asking for Golden Agri to be investigated for providing deliberately misleading information.

However, PT Smart chief executive Daud Dharsono said his firm had complied with all stock exchange rules. 'We are focused on moving on in a constructive manner and urge Greenpeace to do likewise,' he said.

A Unilever spokesman last week said Golden Agri should join RSPO and take other sustainability actions before it would resume buying from them.

Indonesia palm oil giant defends record
Yahoo News 20 Aug 10;

JAKARTA (AFP) – Indonesia's biggest palm oil producer Friday rejected fresh allegations of illegal forest clearing after foreign auditors suggested it had misrepresented the findings of an independent investigation.

Sinar Mas Agro Resources and Technology (SMART), part of the Sinar Mas group, has been struggling to repair its image after a Greenpeace name-and-shame campaign led several foreign buyers to cancel major contracts.

Its credibility took another blow Thursday when British auditors the BSI Group complained that elements of an independent probe which SMART commissioned to verify the legality of its activities had been misrepresented to the public.

SMART had trumpeted the auditors' report as evidence that Greenpeace's allegations were false, but BSI said the probe's "key findings" included that the company had violated Indonesian law on forest management.

It also found that the company had launched operations on almost 38,000 hectares (94,000 acres) of land on Borneo before mandatory environmental studies had been completed.

The company was also found to have planted palm oil crops in high-value deep peatland, but not to the extent claimed by Greenpeace.

SMART president director Daud Dharsono rejected any suggestion it was trying to dodge the findings of its own audit or mislead shareholders.

"We've always emphasised that the independent verification exercise report be shared in an open and transparent manner and that is exactly what we have done," Dharsono said, adding it was published in full on the firm's website.

"Palm oil is a strategic economic product for the alleviation of poverty in Indonesia. We care for our people, the environment and all biodiversity including the important orang-utan."

Peat forests are massive stores of carbon and their destruction for timber or agriculture is a major contributor to emissions of gases blamed for global warming.

Indonesia is the world's biggest producer of palm oil, used in everything from soap to cosmetics.