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MSPO CERTICATION SUMMARY

REPORT

MPOB SPOC Q26 (SIBUTI 1-SG

SAEH/PUTIH/MERAH) &

SPOC Q27 (SIBUTI 2-DAGANG

NIAH/BULAU/BEKENU/SIBUTI)

SURVEILLANCE AUDIT (ASA 01)

Date: 15/05/2018

TUV NORD (Malaysia) Sdn Bhd No. 9F-1A, 9th Floor, Tower 2 @ PFCC Jalan Puteri ½, Bandar Puteri Puchong

47100 Puchong, Selangor. Phone: +603 8600 4031/4032

MSPO Certification Summary Report

Company Name: Malaysia Palm Oil Board

Certifying Unit: MPOB SPOC Sibuti, Sarawak

Client Number: 92-006

Audit Type: Surveillance audit (ASA 01)

MSPO-F04a / Rev 3 2 of 31

Table of Contents

1. INTRODUCTION ............................................................................................ 4

1.1. Objective 4

1.2. Scope 4

1.3. Appointment & Qualification of Team Members 4

2. METHODOLOGY ............................................................................................ 9 Table 2-1: List Of Independent Smallholders 10

Table 2-1-1: List Of Sampled Smallholders for SPOC Q26 Sibuti 1 12 Table 2-1-2: List Of Sampled Smallholders for SPOC Q27 Sibuti 2 13

3. ORGANISATION INFORMATION ................................................................ 12

4. CERTIFICATION ASSESSMENT ................................................................. 20

4.1. Surveillance audit (ASA 01) 20

4.2. Status of Non-Conformities Previously Identified 22

5. CONCLUSION ............................................................................................ 266

6. RECOMMENDATION ................................................................................... 27

7. REFERENCES ............................................................................................. 28

Table 7-1: Documents provided by SPOC Sibuti 28 Table 7-2: Background Investigation And Assessment Documents 29

Table 7-3: List of Interviewed Persons, Observers and Smallholders 30







ABBREVIATIONS

BRL

CHRA

Buku Rekod Ladang

Chemical Health Risk Assessment

CPO Crude Palm Oil

DOE Department of Environment

EFB Empty Fruit Bunch

EIA Environment Impact Assessment

ERT Endangered Rare and Threatened species

FFB Fresh Fruit Bunch

GMP Good Manufacturing Practice

GPS Global Positioning System

HCV High Conservation Value

HCVF High Conservation Value Forest

IPM

MPOB

Integrated Pest Management

Malaysia Palm Oil Board

MSDS Material Safety Data Sheet

NC Non Conformity

OSH Occupational Safety and Health

OSHAS Occupational Safety and Health Assessment Scheme

P&C Principle and Criteria

PK Palm Kernel

POME Palm Oil Mill Effluent

PPE

PTK

Personal Protective Equipment

Pegawai Tunas Kawasan

SA8000 Social Accountability 8000

SIA Social Impact Assessment

SOP

SPOC

Standard Operating Procedure

Smallholder Palm Oil Cluster

MT Metric Tonnes

WHO World Health Organization

MPOB Malaysian Palm Oil Board

HBV High Biodiversity Value

SPOC Sustainable Palm Oil Cluster

LKN Latihan Khidmat Nasihat







1. INTRODUCTION

MPOB SPOC Sibuti has commissioned TÜV NORD Malaysia Sdn Bhd to conduct surveillance audit for its independent smallholders according to MS 2530-2:2013 Part 2, General Principles for Independent Smallholders.

1.1. Objective

The objective of surveillance audit (ASA 01) audit is to assess the MPOB Cawangan SPOC Sibuti as group manager managing the independent smallholders by an independent certification body. The aim of this surveillance audit is assessed on the compliance of the standard by MPOB Cawangan SPOC Sibuti.

1.2. Scope

The certification is based on the documentation established by MPOB Cawangan SPOC Sibuti in managing the independent smallholders’ scheme.

The supporting documents were provided to the audit team as well as information received by means of interviews and background investigation.

The documents and information were reviewed against the requirements and criteria mentioned below. TÜV NORD has employed a risk-based approach in the verification, focusing on the identification of significant risks and reliability of the monitoring and reporting.

The assessment is carried out on the basis of the MS 2530-2:2013: Part 2: General principles for independent smallholders.

In addition, the following reference was used as part of the assessment; the compliance of the requirements out of the guidelines applied was checked.

1. Kod Amalan Baik (GAP) Perkebun Kecil, Malaysia Palm Oil Board

2. Guidelines for Development of a Standard Operating Procedure for Oil Palm Cultivation on Peat.

3. Malaysian Sustainable Palm Oil Part 2: General Principles for Independent Smallholders Audit Guidance.

4. Palm Oil Supply Chain Traceability Requirement, Document MPOB/MSPO/TR/07

1.3. Appointment & Qualification of Audit Team Members

A certification team consisting of one lead auditor and 2 team members.. During onsite team members contributed to the review of documents, conduct field inspection and prepare this report under the leadership of the lead auditor.

Qualification of the Lead Auditor: Mohamad Norhisham Bin Mohd Salleh

Requirement Qualifications

Post-secondary education, college or university diploma / degree in one of the following

i) Agriculture;

ii) Science & Technology (e.g.

Graduate in Applied Science (Major In Agrobiology).








Environmental Sciences, Life Sciences,

Geological Sciences, Natural

Sciences,);

iii) Engineering, Process Technology;

iv) Energy Management, Quality

Management;

v) Social Sciences and/or Anthropology;

vi) Business Management; or

vii) Other relevant related fields

At least five (5) years of work experience in the oil palm sector or related field in consultancy / auditing of similar industry or equivalent related to and as necessary for the certification process. (e.g., sustainability, palm oil management; agriculture, ecology; social science)

5 years working experience in palm oil estates.

Attended the MS 2530 series of standards training

Successfully completed MS2530 series training, RSPO P & C, SCC and ISCC-EU training

Conducted at least three (3) MSPO or equivalent sustainability certification audits as Lead Auditor-in-training with a minimum of fifteen (15) man-days under the supervision of a qualified Lead Auditor for MSPO or equivalent sustainability certification schemes within the last two (2) years.

Under training as lead auditor for MSPO scheme

A good knowledge in handling and evaluating sources of information and data. Able to communicate in Bahasa Malaysia or any other local language.

Able to communicate in Bahasa Malaysia and English.

Field working experience in the palm oil sector, or demonstrable equivalent


Good Agricultural Practices (GAP), and Integrated Pest Management (IPM), pesticide and fertilizer use


Health and safety auditing on the farm and in processing facilities, for example OHSAS 18001 or Occupational, Health & Safety Assurance System

Auditor for RSPO and MSPO scheme.

Worker welfare issues and social auditing experience, for example with SA8000 or

Successfully completed SA 8000 Basic training and auditor for RSPO and MSPO schemes








related social or ethical accountability codes

Environmental and ecological auditing, for example experience with organic agriculture, ISO 14001 or Environmental Management Systems (EMS) or High Conservation Value (HCV)

Successfully completed ISO 14001 LA course and auditor for RSPO and MSPO scheme.

Good Milling Practices for example palm oil milling working experience or demonstrate equivalent.

Auditor for RSPO SCC and ISCC in refinery and mill.

Qualification of Team Members

Requirement Assessor Qualification Compliance

Post-secondary education, college or university diploma / degree in one of the following

i) Agriculture;

ii) Science & Technology (e.g.

Environmental Sciences, Life

Sciences, Geological

Sciences, Natural Sciences,);

iii) Engineering, Process

Technology;

iv) Energy Management, Quality

Management;

v) Social Sciences and/or

Anthropology;

vi) Business Management; or

vii) Other relevant related fields

Terence Ang Diploma and Advance Diploma in Tourism Management

Yes

Zul Hairi Bin Abu Hassan

Senior assessor for carbon credits, 4 years in ISCC, 3 years in MSPO and 2 years in RSPO auditing.

Yes

At least five (5) years of work experience in the oil palm sector or related field in consultancy / auditing of similar industry or equivalent related to and as necessary for the certification process. (e.g., sustainability, palm oil management; agriculture, ecology; social science)

Terence Ang More than 8 years in sustainable related field

Yes


9 years working experience in estate management.

Yes

Attended the MS 2530 series of standards training

Terence Ang Successfully completed MSPO, RSPO P & C LA, SCC, RSPO Next and

Yes








ISCC-EU training.


Successfully complete MSPO Lead auditor training course

Conducted a minimum six (6) on-site audits for a total of at least 20 man-days of audit experience as an auditor-in-training under the direction and guidance of a qualified Lead Auditor for MSPO or equivalent sustainability certification schemes.

Terence Ang Has conducted 3 MSPO and equivalent sustainability certification (RSPO ) as lead auditor in training

Yes

A good knowledge in handling and evaluating sources of information and data. Able to communicate in Bahasa Malaysia or any other local language.

Terence Ang Able to communicate in Bahasa Malaysia, English, and Chinese languages

Yes


Able to communicate in Bahasa Malaysia and English,

Yes

Field working experience in the palm oil sector, or demonstrable equivalent

Terence Ang 1 year as Certifier and Reviewer for RSPO P&C and SCC schemes

1 year as Wildlife (Biodiversity) and Ecotourism Consultant (EMS &HCV)

3 years as Wildlife Guide (Licensed issued by Ministry of Tourism, Malaysia)

6 months as Field Technician for University of Montana on HC

Yes



Yes

Good Agricultural Practices (GAP), and Integrated Pest Management (IPM), pesticide and fertilizer use

Terence Ang 1 year auditor for RSPO and MSPO schemes

Yes










Health and safety auditing on the farm and in processing facilities, for example OHSAS 18001 or Occupational, Health & Safety Assurance System

Terence Ang 1 year auditor for RSPO and MSPO schemes

Yes

Worker welfare issues and social auditing experience, for example with SA8000 or related social or ethical accountability codes

Mohamad Norhisham Bin Mohd salleh

Successfully complete SA8000 Basic Training

Yes

Terence Ang Successfully complete SA8000 Basic Training and 1 year auditor for RSPO and MSPO scheme

Yes

Environmental and ecological auditing, for example experience with organic agriculture, ISO 14001 or Environmental Management Systems (EMS) or High Conservation Value (HCV)

Terence Ang 1 year auditor for RSPO and M Successfully completed EMS ISO 14001: 2015 Lead Auditor training Successfully completed EMS ISO 14001: 2015 Lead Auditor training.

Yes


Successfully completed EMS ISO 14001: 2015 Lead Auditor training.

Yes

Good Milling Practices for example palm oil milling working experience or demonstrate equivalent.

Mohamad Norhisham Bin Mohd Salleh

Has involved in auditing for RSPO SCC standard

Yes

Terence Ang Trainee auditor for RSPO and ISCC in refinery and mill

Yes







2. METHODOLOGY

The audit approach consists of the following steps:

Contract review;

Appointment of team members and reviewer / certifier;

Contact client for relevant documentation according to the applicable MSPO standards;

Audit planning;

Background investigation, desk review of submitted documents;

On-site assessment, inspections, interviews with operational personnel, stakeholders and its contractors; review of documentation;

On-site reporting

Resolution of non-conformance (NC) (if any)

Draft audit reporting

Technical review

Final audit reporting

Peer review

Address Peer Review Comments (if any)

Certifying, final approval and issuance of certificate.

Surveillance Audit:

Surveillance audit was conducted on 09/04/2018 to 11/04/2018 covers the following activities but not limited to below:

Onsite visit, observations and inspections of farms management and activities;

Interview smallholders;

Reviewed revised and updated documentation established and implemented;

FFB production records;

Training records;

Land titles and land application approvals;

Work plans established;

Stakeholders consultation meeting;

Review and closed out of observations raised during stage 1 audit;

Assessment reporting;

For list of all reviewed documents refer to Chapter 7, Table 7-1

For list of personnel participated in the audits refer attendance sheet and Table 7-3.







On-site Assessment

The audit of the farms was conducted according to the MS 2530-2:2013 Part 2 for Independent Smallholders.

The methodology for collection of objective evidence included physical site inspections, observation of tasks and processes, interviews of stakeholders, smallholders, SPOC officers, review of documentation and data.

MSPO guidance documents were used to guide the collection of information. Any comments from by external stakeholders were considered in the assessment.

For this certification audit, the selected independent smallholders were based on the formula S = risk factor √n where S = sample size and n = number of group members which is in accordance to MSPO certification procedure.

The group of smallholders consists of 116 members. For SPOC Q26 (Sibuti 1), total members are 84 with 31 old members and 53 new members. For SPOC Q27 (Sibuti 2) total members are 18 old members and 14 new members.

Since there are old and new members, the sample are separated for conservativeness. Based on the formula, for SPOC Sibuti Q 26 (Sibuti 1) the sample size for old members, S = 5.5 and for new members, S = 7.2 therefore total and round up to the next integral of 14 smallholders. For SPOC SIbuti Q 27 (Sibuti 2) the sample size for the old member, S=4.2 and for new members, S=3.7, therefore total and round up to the next integral of 9 smallholders Thus, a total of 23 smallholders were selected for the onsite assessment and inspection listed in Table 2-1 below:

Table 2-1: List of sampled Independent Smallholders

There are two group of SPOC smallholders that has been sampled, which are SPOC Q 26 Sibuti 1 and SPOC Q 27 Sibuti 2.







Table 2-1-1:List of Sampled Independent Smallholders for SPOC Q 26 (Sibuti 1)

Name of independent smallholders Specific Address / site

Bingkil Bin Bangkol Kpg Keluru Jaya, Bekenu, Sibuti, Sarawak.

Mohd Fitri Firdaus Kpg Subak, Bekenu, Sibuti, Sarawak.

Hj Achi Bin Amin Kpg. Pejuang Kelulit, 98150 Bekenu, Sarawak.

Alam Bte Abu Bakar Kpg Subak 98150 Bekenu Sarawak.

Rosli Bin Jumat Kpg Sebalik Tiris, 98150 Bekenu, Sarawak.

Rahim Bin Jamil Kpg. Pejuang Kelulit, 98150 Bekenu, Sarawak.

Ruku Ak Renang Rh. Nelson Ningkan, Sg. Saeh Putih, SIbuti, Sarawak.

Rosna Ak Anyai Rh. Nelson Ningkan, Sg. Saeh Putih, Sibuti, Sarawak.

Entia Ak Peter Rh. Nelson Ningkan, Sg. Saeh Putih, Sibuti, Sarawak

Senggleng Ak Koron Rh. Nelson Ningkan, Sg. Saeh Putih, Sibuti, Sarawak.

Jelani Ak Guntor Rh. Nelson Ningkan, Sg. Saeh Putih, Sibuti, Sarawak.

Nyawai Ak Sibat Rh. Nelson Ningkan, Sg. Saeh Putih, Sibuti, Sarawak.

Sahir Bin Lamat Kpg Keluru Jaya, 98150 Bekenu, Sarawak.

Sharifah Bte Bangkol Kpg Keluru Jaya, 98150 Bekenu, Sarawak.







Table 2-1-2:List of Sampled Independent Smallholders for SPOC Q 27 (Sibuti 2)

Name of independent smallholders Specific Address / site

Jumain Bin Kadir Kpg. Muhibbah, Ldg 3 OPE 98000 Miri Sarawak.

Ambi Ak Tangkong Rh. Albion Sg. Tiris 98150 Bekenu, Sarawak.

Beji Ak Amat Rh Albion Sg. Tiris 98150 Bekenu, Sarawak.

Lok Ak Ludan Rh Albion Sg. Tiris 98150 Bekenu, Sarawak.

Dayang Sezer Bte Awang Shadan Kpg. Muhibbah, Ldg 3 OPE 98000 Miri Sarawak.

Haniff Ariffin Bin Abdullah Kpg. Bukit Peninjau, Jln. Miri Bintulu, 98007 Miri Sarawak.

Dan Ak Kuku Rh Saga Sg Semuru 98150 Bekenu, Sarawak.

Bunda Ak Jamit Rh Bali Sg Semuru A Sibuti, Sarawak.

Junaid Ak Asan Rh Saga Sg Semuru B 98150 Bekenu, Sarawak.

Non-conformance:

On the basis of the desk review, evidences presented during the audits as well as from the onsite visits non-conformance (NC) Major and Minor as well as Observations (OBS) may be raised during the audit.

Major non-conformance shall be addressed and responded within 60 days from date of audit. All minor non-conformances will required submission of action plan and are accepted by Lead Auditor. Implementation of Minor NCs and OBS will be reviewed and verified during the next audit.







3. ORGANISATION INFORMATION

MPOB Cawangan SPOC Q26 Sibuti 1 and SPOC Q27 SIbuti 2, is a branch of MPOB located at Sibuti to provide technical support as well as develop the independent smallholders’ scheme around the Sibuti district.

MPOB SPOC Sibuti Q 26 was managed by Group Manager, Mr Ardyan and SPOC SIbuti Q 27 was managed by Group Manager, Mr Emran. They are supported by a team to manage the cluster in providing technical support, estate management skills and training.

The location of the SPOC Q 26 Sibuti 1 and SPOC Q27 Sibuti 2 office is at 1st floor survey lot 1828 (sublot 2), Lot 647, 1223, 1225, Block 8, Seupok , 98200 Niah, Sarawak, Malaysia.

The locations for the smallholders are in Sibuti district as shown in the below maps.

Figure 1: Smallholders location SPOC Q 26 Sibuti 1 (1).







Figure 2: Smallholders location SPOC Q26 Sibuti 1 (2).

Figure 3: Smallholders location SPOC Q26 Sibuti 1 (3).







Figure 4: Smallholders location SPOC Q 26 Sibuti 1(4).








4. CERTIFICATION ASSESSMENT

4.1. Surveillance audit (ASA 01)

The objective of the surveillance audit is to assess the activities of MPOB Cawangan SPOC Q 26 Sibuti 1 and SPOC Q27 Sibuti is in compliance with MS 2530-2: 2013 Part 2: General principles for independent smallholders’ requirements.

There are 116 smallholders joined the certification during this surveillance audit. The total number of smallholders were increased by 65 members from 51 members during certification audit..

The surveillance audit was conducted on 09/04/2018 to 11/04/2018 that include inspection of the smallholders farms, farms boundary, interviews, conduct stakeholders’ consultation and review of the observations raised in the last audit.

The audit team has applied the Malaysian Sustainable Palm Oil Part 2: General Principles for Independent Smallholders Audit Guidance to assess the established documents against the Principles and Criteria of the standard.

The details assessment of the Principles & Criteria, refer to P & C audit report attached to this summary report.

During the onsite the following were verified.

1. Compliance to legal requirements on the land title, land use rights and customary rights

2. Training and competence

3. Environmental management

4. Waste management and disposal

5. Best practice – farm management including fertilising, chemical spraying and harvesting.

During the previous certification audit, there were two observations raised. The audit team has reviewed and closed out the observations raised by means of inspection of smallholders’ farms, conduct interviews, review and verify documents that are established, corrected and implemented appropriately by the SPOC team. The corrective measures implemented could be verified as appropriate and the observations were closed out.

The number of audit findings raised in this audit been addressed in Section 4.3 of this audit report. For details of the assessment, refer to the P & C audit report attached to this summary report.

TUV NORD (Malaysia) Sdn. Bhd. Has published the public notification on 05/03/2018 as to accommodate stakeholder’s consultation meeting for SPCO Sibuti. A stakeholder consultation was conducted on 09/04/2018 to gather information from the local communities in accordance to §7, 3.2 of the Certification Procedure requirements. The topics of discussion are as below:

a. Introduction of SPOC Sibuti objectives of MSPO standard certification for smallholders.

b. Development of smallholder’s farms in Sibuti area;

c. Wildlife management area and impact to the smallholders;

d. Environmental issues on the impact of river contamination;

e. Type of wildlife around Sibuti area;

f. Support from processing palm oil mills at Sibuti area.







There are no issues raised during the stakeholders’ consultation that need to be addressed by the SPOC management office. It can be concluded the relevant Principles and Criteria clauses of the applied standard are in compliance.

The List of Stakeholders who attended the meeting refer to table 6.3.

For details of the assessment, refer to the P & C audit report attached to this summary report.

Item Subject discussed Audit team findings Company response and proposed action to be taken

1 Any information from Group Manager / Company [thereafter known as GM] in regards to the MSPO audit?

Stakeholders understood and aware of audit conducted via invitation letter which has been sent to them one month before the audit started.

SPOC Sibuti has informed stakeholders as regards to stakeholders meeting held on 09/04/2018..

2 Social context There was no social issue raised by stakeholders as regard to SPOC Sibuti management and its members.

SPOC Sibuti confirmed that there was no complaint related to any social issue at the time being.

3 Understanding of “NCR Land”?

Stakeholders understood as regard to NCR land. There is no dispute with the members of SPOC regarding land ownership.

SPOC Sibuti always liaise with smallholders in ensuring no NCR issue raised.

4 Economy / Livelihood

Is there any impact on livelihood after the introduction of MSPO?

Stakeholders involved in the meeting understand that knowledge and information in good agricultural practises would benefit them.

Positive comment was noted by SPOC Sibuti Management team.

5 Does MSPO will largely benefits the local community?

There are good comments by stakeholders as regard to MSPO scheme. They support the scheme as the note that it will improve the palm oil industry.


6 HCV and environmental understanding

Stakeholders’ responds indicate that they do aware on activities that effect the environment or protective area within their place.


7 Awareness towards species, habitats, and high conservation values?

Stakeholders attended the meeting confirmed that they do understand the conservation needs in their place.


8 Support to There are support from MPOB and other government agencies

SPOC Sibuti is supportive towards smallholders via







smallholders such as Jabatan Pertanian as regards to knowledge and training was conducted to SPOC members.

giving them information and training.

9 FFB quality Stakeholders especially smallholders understand the requirement of FFB quality. The information on grading will gained mainly via dealers and mills

SPOC SIbuti has conduct training for their smallholders as regards to the quality of FFB.

10 Are there any plantation or mill management practices that affect you?

Stakeholders attended the meeting confirms that no negative impact present from SPOC Sibuti.

SPOC Sibuti has established grievance procedure for internal and external parties

11 Do you consider any management is in conflict with the MSPO/ principles and criteria?

Stakeholders attended the meeting are un aware on the understanding of MSPO Although there are communications with group members, there are no engagement by group manager with the stakeholders.

Group manager indicates that no engagement was made to stakeholders. Thus, minor non-conformity has been raised under indicator 4.6.3.1.

12 Do you have any suggestions for management?

There are suggestions from stakeholders to meet with the management since they are not really clear in regards to their role as stakeholders.

The issue of engagement with stakeholders has been explained as per above.

4.2. Status of Non-Conformities Previously Identified

The stage 1 audit findings of this system have been reviewed, in particular to assure appropriate correction and corrective action HAS implemented to address identified audit findings. Details of the follow up action taken on stage 1 audit findings were recorded in the Stage 1 audit report.

X The last audit results of this system have been reviewed, in particular to assure appropriate correction and corrective action HAS implemented to address any nonconformity identified.

The last audit results of this system have been reviewed, in particular to assure appropriate correction and corrective action HAS NOT been implemented effectively. Non-conformity will be re-raised.

Not applicable. No non-conformity raised in previous audit.

Note 1: If a minor non-conformity raised in last audit, is not closed out, then this finding will be re-raised to a Major non-conformity.

Note 2: All minor NCs raise in last audit are required to capture in this report together with the closing of the non-compliance.







Observation < NO 1 >

Indicator: 4.3.1.1 Independent smallholders shall show awareness of compliance with all applicable local, state, national and ratified international laws and regulations.

Location SPOC Sibuti

Description of Finding / Objective Evidence:

Verified the individual smallholder’s MPOB’s license against the master list and found many not updated to the latest validation period.

Review of Correction & Corrective / Preventive Action

Sighted all individual smallholders file containing MPOB license (menjual dan mengalih buah kelapa sawit) of smallholders has been reviewed, updated and valid.

Closed: Yes No Site verification : Yes No

Name of Lead Auditor:


Date of Closed:

09/04/2018

Observation < NO 2 >

Indicator: 4.6.2.1 Group manager shall establish a documented business or management plan to demonstrate attention to economic and financial viability.

Location SPOC Sibuti


However, the planning for the year in term of monitoring, process of certification, maintain GAP and implementation is not available at group manager level. Group manager should be aware of such budget and/or develop a budget for implementation, training and also for certification process.


Sighted Tuntutan Perbelanjaan Pendahuluan as part of planning budget for SPOC Sibuti. The tuntutan has allocate budget for training.



Mohamad Norhisham Bin Mohd salleh

Date of Closed:

09/04/2018

4.3 Detail of Audit Findings Identified During This Audit

This section gives an overview of the non-conformities raised during this audit.

AUDIT OUTCOME

MAJOR Non-Conformities 0

MINOR Non-Conformities 1

Observations 0







Non Conformity Number < 01 >

Indicator: 4.6.3.1 Independent smallholders are encouraged to communicate with and have consultations with dealers, millers, local communities and other affected or interested parties.

Location Office, SPOC Sibuti


SPOC SIbuti has established list of stakeholders. However, there are no evidence of engagement with stakeholders by the group manager.

Classification Major Minor Observation

Deadline for implementation

Next surveillance audit

Root Cause Analysis (by company):

Group manager was not aware that their responsible are to communicate and engage with stakeholder.

Correction (by company):

SPOC Sibuti will be conducting meeting with stakeholder. Refer to the attachment for meeting scheduled

Corrective / Preventive Action (by company)

i. Program for stakeholder meeting will be establish yearly.

ii. Stakeholder meeting will be minutes accordingly.


Sighted list of stakeholders with date of meeting to be conducted. List of stakeholders involve all applicable government agencies, villages head, dealers and mills. Date of meeting with stakeholders was planned on 13/08/2018 to 15/08/2018. Implementation on the action plan will be reviewed on the next audit.




Date of Review Action Plan:

04/05/2018

Review of Implementation for Major NC (where applicable)

Closed: Yes No

Name of Lead Auditor :

Date of Closure:







5. CONCLUSION

Malaysia Palm Oil Board, Cawangan SPOC SIbuti has commissioned TÜV NORD Malaysia Sdn Bhd to carry out the certification for the Sustainable Palm Oil Cluster (SPOC) consisting of independent smallholders according to MS 2530-2:2013 Part 2, General Principles for Independent Smallholders.

Minor NC raised in this audit will be verified in the next surveillance audit for effective implementation. The corrective action submitted has been reviewed and accepted.

From the review of the standard operating procedures, relevant forms, work flow charts established and implemented; the subsequent background investigation and interviews conducted during this surveillance audit have provided TUV NORD Malaysia with sufficient evidence on the fulfilment of the applied standard Principles & Criteria.

In conclusion the certified organisation has been established, implement and continue to improve in managing the independent smallholders are in line with the Principles & Criteria of the applied standard MS 2530-2:2013 Part 2.

As a result of this audit, the audit team confirms that:

Total certified number of independent smallholders: 116

Total certified acreage of smallholders: 776.3 Ha

Certified FFBs output January to December 2017: 6,375.15 mt

Certified FFBs output January to December 2018: 13,268.00 mt







6. RECOMMENDATION

The audit team conducted a process-based audit focussing on significant aspects / risks and objectives required by the standard(s). The audit methods used were interviews, observations, sampling of activities and review of documentation and records.

Any audit is based on sampling within an organization’s management system and therefore is not a guarantee of 100 % conformity with requirements.

The structure of the audit was in accordance with the audit plan included to this summary report as annex.

The audit team concludes that the organisation has established and maintained its management system in line with the requirements of the standard(s) and demonstrated the ability of the system to achieve requirements for production and management within the scope and the organisation’s policy and objectives.

Therefore, the audit team recommends that, based on the results of this audit and the system’s demonstrated state of development and maturity that this management system certification be

Recommended for Certification / Recertification

X Recommended for Continuity of Certification

Suspended of Certification

Subang Jaya, 15/05/2018 Subang Jaya, 15/05/2018


TUV NORD (Malaysia) Sdn Bhd

Lead Auditor

Cheong, Chun Yuen (Robert)

TUV NORD (Malaysia) Sdn Bhd

Technical Reviewer







7. REFERENCES

Table 7-1: Documents provided by SPOC Sibuti

Client Reference Document

MSPO Policy for Smallholders dated 28/02/2018

Senarai Impak Sosial Persekitaran & Pelan Tindakan, Document no: MSPO/SSCC-04/ISP,

Issue 01 dated 30/03/2018

Internal Audit Report SPOC Sibuti, dated 20/03/2018 and 21/03/2018

Carta Aliran Rekod Penyata Pendapatan dan Perbelanjaan Pekebun Kecil

Rekod Hasil dan Pendapatan 2017and 2018

Smallholders FFB tickets

Senarai Keperluan Undang-Undang, document no. L-02/SKU/2016 dated 01/04/2016.

SOP Aduan dan Rungutan Document no: SOP-01/AR/2016, issue 01, dated 01/04/2016

SOP Pengendalian dan Pelupusan Bahan Kimia, SOP-02/BK/2016, issue no 01, dated 01/04/2016

Terma Penggajian Pekerja SPOC SIbuti.

Training Programme for year 2018 document

Training Calendar 2018

Buku Rekod Ladang (BRL) year 2017 and 2018

Biodiversity Inventory Lists year 2018

Senarai Keperluan Undang-Undang tahun 2018







Client Reference Document

Smallholders MPOB Licenses

Smallholders Native Customary Rights Land (NCR) title status approval from Land Office

Table 7-2: Background Investigation And Assessment Documents

Reference Document

MSPO Certification Scheme Doc. No: MPOB/MSPO/CS/01 dated 19/11/2013

MSPO 2530-2:2013: Part 2: General principles independent smallholders

MSPO Certification Procedures & Guidelines

Kod Amalan Baik (GAP) Pekebun Kecil, Malaysia Palm Oil Board

OSHA (Classification, labelling and Safety data Sheet of Hazardous Chemicals) Regulations 2013

Occupational Safety and Health Act 1994 Act 154

OSHA (Classification, Labelling, and Safety data Sheet of Hazardous Chemicals) Regulations 2013

Pesticides Act 1974

Poisons Act & Regulations - Act 366

Wildlife Conservation Enactment 1997

Immigration Act 1959/63 Act 155

MPOB Act 1998 Act 582

Laws of Sarawak Chapter 84 (1958 Edition)







Reference Document

Wildlife Seksyen 29 (1) WPO 1998

Workers Minimum Standards of Hoing & Amenities Act 1990 Act 446

Minimum Wage Order 2016

Water Act 1920 Act 418

Table 7-3: List of Interviewed Persons, Observers and Smallholders

No. Name Organization / Function

1. Linan Ak Jalak Tuai Rumah Linan

2. Hassan Bin Malik Ketua Kampung Muhibbah Ladang 3

3. Nelson Nuigkan Ak Kumbang Tuai Rumah Nelson

4. Norfazila Bte Hamdan Representative, DF Elaeis Company

5. Goh SIw Hua Representative, DF Elaeis Company

6. Awang Mohammad Bin Awang Sahdan

Ketua Masyarakat Kawasan Niah







Distribution / Confidentiality / Rights of ownership / Limitations / Responsibilities / Audit Objectives

This report is sent to the certification body or bodies, the members of the audit team and the audit representative of the organisation. All documents (such as this report) regarding the certification procedure are treated confidentially by the audit team and the certification body. This audit report remains the property of the certification body.

An audit is a procedure based on the principle of random sampling and cannot cover each detail of the management system. Therefore nonconformities of weaknesses may still exist which were not expressly mentioned by the auditors in the final meeting or in the audit report.

The responsibility for continuous effective operation of the management system always rests solely with the audited and certified organisation. Salvo clause: The audit report will be left to the organisation at the end of the audit - subject to approval by the certification body. The independent release process may cause modifications or additions. In these cases a modified revision will be sent to the audited organisation.

The objective (goal) of the audit is to establish compliance of the management system of the aforementioned organization with the requirements of the aforementioned standard in order to achieve or maintain certification through an independent and accredited certification body. Identification of possibilities to improve the management system can also be a component of the audit and is considered simply to be an enhancement; it does not constitute consultancy or advice with regard to the management system.

Annex / Enclosures

Annex / corresponding audit documentation

P&C Audit Report / Checklist(s)

Audit Plan

Additional annexes, number

Malaysia Sustainable Palm Oil – MS 2530-2:2013: Part 2 for Independent Smallholders Audit P & C Report

Company Name: Malaysia Palm Oil Board Client No: 92-006

Certifying Unit: MPOB SPOC Sibuti, Sarawak Audit Type: Surveillance audit (ASA 1)

MSPO-F05a / Rev 2 Page 1 of 21

Item Description

1 Company Name Malaysia Palm Oil Board

2. Certifying Unit MPOB SPOC Sibuti, Sarawak, Malaysia.

3. Address 1st Floor Survey Lot 1828 (Sublot 2), Lot 647, 1223,1225, Block 8, Seupok, 98200 Niah, Sarawak.

4. Contact Tel:+6085-733011 Fax:+6085-733012 Website:- http://www.mpob.gov.my

5 Location of plantation / estate

Sibuti, Sarawak

6 Geo Coordinates of plantation / estate

Refer to list attached

7 Contact Person Name: Mr. Emran Bin Drahman /

Mr. Ardyan Bin Azis.

Tel: +6085-733011 Mobile:- Email: [email protected] /

[email protected]

8 Date of Audit 09/04/2018 - 11/04/2018

9. Audit Team Members

Team Leader / LA Mohamad Norhisham Bin Mohd Salleh

Auditor Member Ang Wai Sheng, Zul Hairi Bin Abu Hassan

Expert / Trainee / Observer

Nil

http://www.mpob.gov.my/

mailto:[email protected]%20/

mailto:[email protected]





Clause Principle & Criteria

Verification Guidance Guidelines Findings & Comments Conformity

Yes / No

4.1 Principle 1 Management Commitment & responsibility

4.1.1 Criterion 1 Malaysian Sustainable Palm Oil (MSPO) Policy

4.1.1.1 There shall be a policy binding smallholders to MSPO

(MAJOR)

- Statement of commitment to MSPO signed by group manager

- This applies only to independent smallholders under group manager

SPOC Sibuti has established Malaysia Sustainable Palm Oil Policy, signed by SPOC Sibuti 1 Group Manager and SPOC Sibuti 2 Group Manager dated 28/02/2018.

The policy states:

- Commitment and responsibility of SPOC.

- Openness in giving information to stakeholders.

- Documentation for traceability.

- Compliance to the local laws, national and international laws and regulations.

- Contribution to local sustainability development.

- Resolving complaints and grievances in transparent manner.

- Working environment, worker’s safety and health aspects.

- Preserve environment, natural resources, biodiversity and ecosystem.

- Protect rare and endangered species, and high biodiversity value habitats.

- Zero open burning and good agricultural practice.

- Compliance to new planting for palm oil.

Sighted member admission form, example:

Yes







Yes / No

1. Smallholder No 12 Q 26 dated 23/08/2016, and signed by Office Manager, SPOC Sibuti.

2. Smallholder No 95 Q26 dated 28/08/2018 and signed by Group Manger, SPOC Sibuti.

List of training conducted:

1. Training on MSPO Policy for old member was conducted on 13/08/2017 by MPOB officer from headquarter and Pegawai Tunas attended by 50 personal.

2. Training on MSPO Policy Kursus Sehari sawit dan Kursus MSPO was conducted on 27/02/2018-28/02/2018 by Office Manager, SPOC Sibuti and Group Manager, SPOC Sibuti attended by new member 93 personal.

Interviews with smallholders on their farm indicates they are aware and understand the MSPO Policy and the policy was available in the individual file.

4.1.2 Criterion 2 Continual Improvement

4.1.2.1 Indicator 1 The action plan for continual improvement shall be based on the consideration for the main social and environmental impact and opportunities of the independent smallholder’s group, such as SPOC. Independent smallholders shall be aware of the need to understand the

- Identified social and environmental impact

- Selection of the impact that requires continuous improvement that bring benefits to the smallholders

- Awareness programme for the need for continual improvement

- Interview and record assessment

- JKKK or JKKP meeting

- Dissemination of information to

SPOC Sibuti has established Senarai Impak Sosial , Persekitaran & Pelan Tindakan MSPO /SSCC/L-04/ISP

Effective date 30/03/2018 issue no: 01.

Example of social impact:

Activiti.

Pembukaan Kawasan kebun, membaja, meracun dan menuai.

Impak Sosial.

Meberikan peluang pekerjaan kepada penduduk di

Yes







Yes / No

importance of continuous improvement.

(MAJOR)

members about future activities

- Group manager to develop action plan

kawasn penempatan sekitar lading.

Pelan tindakan.

Amalan diteruskan.

Example of environmental impact:

Aktiviti.

Meracun.

Impak Persekitaran.

Pelupusan bahan buangan (tong racun kosong).

Pelan tindakan.

Pembasuhan tiga kali, ditebuk lubang dan di simpan ditempat khas.

Pelan tindakan.

Amalan diteruskan.

Interview with smallholders indicates they received training and awareness as regards to new technology related to palm oil industry and field management.

4.1.2.2 Indicator 2 Group management shall establish a system to improve practices in line with new information and techniques; and for disseminating this information throughout the group members.

(MAJOR)

- Identification of new technologies

- Dissemination of information regarding new technologies:

Discussion

Site visit

Plot demo

Flowchart, etc.

- Group interaction on the awareness and availability of the new technology or information

Warta Sawit magazine was provided by MPOB headqauters to SPOC Sibuti and disseminated to smallholders during training conducted.

Sighted Warta Sawit Bil. 66 (2) /May -August 2017 and Warta Sawit Bil. 67 (3)/ September-December 2017.

Smallholders gain information in regard to new technology via training provided by SPOC Sibuti and Warta Sawit.

Yes







Yes / No

- Acceptance and implementation among members

- Monitoring success or improvement with new technologies

- Internal audit to be conducted by group manager as applicable

- Result of internal audit indicate the performance of the smallholders in the group

4.2 Principle 2 Transparency

4.2.1 Criterion 1 Traceability

4.2.1.1 Indicator 1 The group management shall commit itself to implement and maintain the requirements for traceability.

(MAJOR)

- Tracking system that can trace FFB to the source (smallholder’s block, plot)

- Source of planting materials

- Applies to group manager for independent smallholders

SPOC has established Carta Aliran Rekod Penyata Pendapatan dan Perbelanjaan Pekebun Kecil. The chart list stated:

- Pekebun kecil menghantar BTS ke pusat timbang atau kilang

- Pegawai Tunas merekod hasil jualan setelah pekebun kecil menerima bayaran dari pusat timbang atau kilang berdasarkan salinan resit dan tiket timbang.

- Segala hasil jualan dan perbelanjaan direkod di dalam penyat apendapatan dan perbelanjaan pekebun kecil seperti upah menuai, meracun membaja dan mengangkut.

- Semua dokumen yang direkod perlu difailkan

- Tamat.

The chart serves as a procedure for traceability.

Yes







Yes / No

4.2.1.2 Indicator 2 To keep records of sales and delivery or transportation of fresh fruit bunches.

(MAJOR)

- Verification of records and documents Each member has Buku Rekod Ladang to keep track on the amount of FFB harvest for each month.

Example of records:

Smallholder: No.3 Q 27

MPOB license number: 451944-101000

Land area: 25.13 hectare

Summary of weighbridge ticket Dealer A. for the month of January sighted 29.52 mt

Smallholder: No. 23 Q27

MPOB license number: 424537-501000

Land area: 1.00 hectare

Summary of weighbridge ticket Mill A for the month of March 2018 sighted 2.72 mt

Yes

4.3 Principle 3 Compliance to legal requirements

4.3.1 Criterion 1 Regulatory requirements

4.3.1.1 Indicator 1 Independent smallholders shall show awareness of compliance with all applicable local, state, national and ratified international laws and regulations.

(MAJOR)

- Interview to test awareness :

Licensing requirements

Labour Law

Environmental Act

Immigration

Child Labour – not applicable on family farms

SPOC Sibuti has established Senarai Keperluan Undang-Undang, document no L-02/SKU/2016 effective date 01/04/2016. Example of list of laws available:

1. Organization Safety and Security Act 1994

2. Environmental quality Act 1974

Awareness training on laws and regulations was part of Program Kursus Bengkel MSPO (SPOC Sibuti) 2018 conducted on 27/02/2018 – 28/02/2018. Training conducted by MPOB officer, Office manager SPOC Sibuti.

Yes







Yes / No

MPOB license for smallholders was up to date. Example of license sighted:

a) Smallholder No 28 Q 27, license number 422000-301000, license valid for 5 years from 01/07/2018 to 30/06/2023.

b) Smallholder No 32 Q 32, license number 476634-101000, license valid for 5 years from 01/10/2018 to 30/09/2021.

Site interview with smallholders indicates they are aware regarding the law and regulation example minimum wages, under age and license from the MPOB for selling the FFB.

4.3.2 Criterion 2 Land use rights

4.3.2.1 Indicator 1 Independent smallholders shall demonstrate rights to their landholdings and there is no evidence of major land disputes.

(MAJOR)

- Verification of land ownership Group has established list of smallholders with status of land title.

a) SPOC Sibuti Q 27

Type of title Number

NCR 18

NCR-Parameter 2

Titled land 12

Total 32

b) SPOC SibutiQ 26

Type of title Number

NCR 69

Yes







Yes / No

NCR-Parameter 0

Titled land 15

Total 84

There are several documents to demonstrate land title:

1. Borang Pengesahan Mengusahakan Tanaman Sawit

- Smallholder No 12 Q 27 MPOB No:445650-30100

2. Lease of state land;

- Smallholder No 17 Q 27 MPOB No: 445821-201000

- Smallholder No 15 Q 27 MPOB No:444469-601000

4.3.3 Criterion 3 Customary rights

4.3.3.1 Indicator 1 Independent smallholders shall demonstrate customary rights to their landholdings

(MAJOR)

Note. Where recognized customary or legally owned land has been taken over and where there is documentary proof of a transfer of rights

- Verification of land ownership or user rights

Most of the smallholders have NCR land. Sighted documented evidence are:

1. MPOB license for ‘menjual dan mengalih’ which shows the hectarage of their land.

Example:

Smallholder No 12 Q27

MPOB number: 445650-301000

Hectarage: 8.75 hectare.

2. Surat Pengesahan hak milik tanah which was a letter of acknowledgement by tuai rumah regarding the ownership of NCR land.

Yes







Yes / No

(eg. Sale) and of payment or provision of agreed compensation.

Example:

Tuai Rumah name: Tuai Rumah A

House Address: Rumah Albion, Sungai Tiris, Bekenu.

Owner’s name: Smallholder No 12 Q 27.

4.3.3.2 Indicator 2 Maps of an appropriate scale showing extent of recognized customary rights land, if any, should made available.

(MINOR)

- Group manager to provide evidence to show that the land does not overlap with neighbours. This can be done through participatory mapping, where applicable.

There are two type of maps to show the boundary and location of smallholder’s farm;

1. Smallholder’s farm map acknowledge by tuai rumah or ketua kampung.

2. State lease land title which also included owner’s map.

Sighted during field observation for boundary marker on smallholder’s farm, example Smallholder No 3 Q 27, coordinate 113

o 51’ 13.1’’E 3

o 55’ 33.6’’N.

Yes

4.4 Principle 4 Social responsibility, health, safety and employment conditions

4.4.1 Criterion 1 Complaints and grievances

4.4.1.1 Indicator 1 Independent smallholders shall be able to respond to complaints that are raised by their neighbours or other stakeholders.

(MAJOR)

- Group manager to collect or keep records of all complaints or request from stakeholders

- Smallholders to screen the requests and to respond to those within their ability

- The group manager to respond to those requests which cannot be handled by the smallholders

Group has established complain and grievance SOP document number SOP-01-AR/2016 effective dated 01/04/2016. The procedure comprised two sections:

a. Accepting grievances. b. Action taken, which include acknowledgement by

the complainants.

Timeline stated for the grievance to be address within 14 days as stated in the grievance chart.

Interview with smallholders indicates that they

Yes







Yes / No

understand the complaint procedure and aware on process involve in delivering their complaints.

4.4.1.2 Indicator 2 The local system should be able to resolve disputes.

(MINOR)

- Group manager to implement a system to collect complaints / suggestions / disputes

- Availability of a system to channel complaints to designated person (e.g JKKK, Tuai Rumah)

- The designated person to assign appropriate parties to handle the disputes

- The designated person to ensure that dispute is resolved within reasonable time

Group has established grievance form F-01/AR/2016 to record any grievances.

Example:

Grievance.

Name ofcomplainant: Smallholder No 5 Q 27.

Date: 18/08/2017

Complaint: FFB road damage.

Received by: SPOC Manager

Action: SPOC Manager sent letter to MPOB headquarters regarding the complaint letter dated 18/08/2017. MPOB headquarte reply the complaint letter dated 29/12/2017 to SPOC Sibuti Manager and smallholder involved. The MPOB headquarter letter stated that MPOB will help the smallholders by forwarding the letter to MPIC.

Yes

4.4.2 Criterion 2 Employees safety and health

4.4.2.1 Indicator 1 Independent smallholders need not have a formal health and safety plan but shall ensure that all work practices are safe

(MAJOR)

- Group manager to promote awareness on the safe work practices

- Group manager to provide PPE & training in the premises

- Interview :

Accident

Safety equipment or PPE

Training on safety and health

Training on safety and health has been conducted GAP training as part of integrated program.

Example:

- MSPO Training for GAP, Environmental, OSHA, Laws was conducted by MPOB Officer and Pegawai Tunai Bekenu 1 on 13/10/2017 and 27/02/2018 respectively..

- .

Yes







Yes / No

- Observation of operation at site

Site visit to sampled smallholders indicates that they were doing field work by themselves. Awareness training on PPE usage was provided by group manager. Smallholders are provided with PPE box to store the PPE after using. Example at smallholder’s block, Smallholder No 13, Q26.

4.4.3 Criterion 3 Employment Conditions

4.4.3.1 Indicator 1 For independent smallholders with temporary workers, work conditions shall be in accordance with a mutual verbal agreement made transparently and freely.

(MINOR)

- The temporary workers verbally agree to the terms prior to the execution of the work

- Evidence through interview

Group has established form Terma Perjanjian Penggajian Pekerja SPOC Sibuti. The rate for specific field work paid to the workers.

Example:

1) Menuai buah kelapa sawit (RM/mt)

2) Membaja (RM/beg)

3) Meracun (RM/acre)

4) Pemangkasan pelepah (RM/trees)

Sighted rate paid by smallholders. Smallholder 5 Q 27 (to workers A (with work rateRM50.00 per mt of FFB in line with the applicable laws.

Yes

4.4.3.2 Indicator 2 Independent smallholders shall provide equal opportunity and treatment regardless of race, colour, sex, religion, political affiliation, nationality, social origin or other distinguishing characteristics and shall not engage in or support discriminatory practices in

- Absence of complaints on discrimination

- Interview workers

There are no complaints related to discrimination sighted during documents review. Field interviews with smallholders and meeting with stakeholders confirm no discrimination occurs.

Yes







Yes / No

line with national aspiration

(MINOR)

4.4.3.3 Indicator 3 Independent smallholders shall ensure that worker’s pay and conditions meet legal standards as per mutual agreements.

(MAJOR)

- Applicable for monthly wages only - Absence of complaints on worker’s

pay and conditions - Evidence of mutual agreement - To assess agreement or legal

standards with actual condition - Interviews :

Workers (regular & non-regular)

Contractor

Job specification

Payment

Satisfaction

Smallholders hired casual workers to work on their farm. Terma Perjanjian Penggajian Pekerja SPOC Sibuti was sighted for amount paid to theworkers:

1) Smallholder No.5 Q 27

Work Rate

Harvesting RM 45.00/ mt

Manuring RM 4.00/beg*

Spraying RM 30/ acre

Pruning Nil

*MPOB provided manure: 25kg

2) Smallholder No. 4 Q 27.

Work Rate

Harvesting RM 50.00/mt

Manuring RM 4.00 /beg

Spraying RM 30.00/acre

Pruning RM 1.00/palm/year

Yes

4.4.3.4 Indicator 4 In cases where on-site living quarters are provided, these quarters

- Acceptable living conditions for workers, when provided

- Site visits

Smallholders were helped by their relatives or hired local casual workers. These workers stay at their own houses nearby to the smallholder’s land.

Yes







Yes / No

shall be habitable and have basic amenities, where available and practical.

(MAJOR)

- Interviews - Observation

There is no living quarters observed during site visit to smallholders block. Most of the work was done by family members. The causal labours are the local villagers who stay on their own house within the same village or neighboring village.

4.4.3.5 Indicator 5 Children and young persons are not to be employed or exploited. The minimum age and conditions of employment shall comply with local, state or national laws. Work by children and young persons is acceptable on family farms, under adult supervision, and when it does not interfere with their education. They are not to be exposed to hazardous working conditions. (MAJOR)

- Labour Law - Child and Young Person

(Employment) Act 1966 - Interviews - Observation

Type of work that children are not allowed to do (handling of agrochemical, fertilizer, sharp tools, harvesting, handling heavy object, machinery)

Legal register dated 01/02/2016 includes Akta Kanak-Kanak dan Orang Muda (Pekerjaan) 1966.

Group MSPO policy states commitment to comply with the local laws, national and international laws and regulations.

There is no hiring of children as workers from interview with group managers and smallholders and no child labor found during field visit.

Yes

4.4.4 Criterion 4 Training and competency

4.4.4.1 Indicator 1 Independent smallholders are encouraged to seek knowledge to increase their competency in oil palm management.

- Training to be provided for smallholders by the group manager:

GAP

Safety

Group has established Training Calendar 2018. List training that scheduled to be conducted are;

1. Kursus Sehari Sawit Bersama Pekebun Kecil.

2. Kursus Sehari Sawit Bersama ahli kelab 30mt.

MSPO Training for GAP, Environmental, OSHA, Laws

Yes







Yes / No

(MINOR) Financial management

- Interviews - Expenditure on visits or reading

materials.

were conducted by MPOB Officer and Pegawai Tunas Bekenu 1 on 13/10/2017 and 27/02/2018.

4.5 Principle 5 Environment, natural resources, biodiversity and ecosystem services

4.5.1 Criterion 1 Environmental management plan

4.5.1.1 Indicator 1 Independent smallholders are expected to be aware of the environmental impact but are not expected to undertake any formal impact assessment unless there is a legal requirement.

(MINOR)

- Training to be provided by the group manager

- Interviews :

Understanding of sensitive areas (rivers, steep slope, forest, wetlands, mangrove area, swamp area) in and around smallholder plot

Understanding of the agricultural impact to the sensitivity requirements

- Site visits - Observation

Training on riparian area was conducted on 27/02/2018 by MPOB Officer and Pegawai Tunas Bekenu 1. Training material stated on explanation regarding activities that are not permitted such as manuring and spraying at the riparian area.

Field visit to smallholders field that have river indicates that they are aware and know about the restricted activities within the riparian area and there are signage (ZON PENAMPAN).

Yes

4.5.2 Criterion 2 Efficiency of energy use and renewable energy

4.5.2.1 Indicator 1 The use of renewal energy should be applied where

- Efficiency of use of energy (diesel or electricity per tonne FFB) depending on scale of operation

Smallholders do not use renewable energy either from solar, biomass, or biogas sources.

Yes







Yes / No

possible.

(MINOR)

- Observation on any renewal energy use (buffalo, solar, hydropower, biodiesel)

No renewal energy sighted during site visit.

4.5.3 Criterion 3 Waste management and disposal

-

4.5.3.1 Indicator 1 All waste products and sources of pollution shall be identified.

(MAJOR)

- All field and domestic waste are identified by the group manager

Group has established list of scheduled wastes based on Peraturan-Peraturan bahan Buangan Terjadual 2005. Example:

Code Type

SW 305 Used lubricant oil

SW 409 Empty chemical containers

SW 410 Rag, paper or filter that has been contaminated with schedule waste

Group has established list of smallholders and waste generated with option of r reuse of chemical containers for chemical spraying purposes or buried.

Two items included in the list;

1) Empty chemical containers.

2) Fertilizer bags.

Yes

4.5.3.2 Indicator 2 Independent smallholders shall ensure that waste from the smallholdings is disposed of appropriately. Smallholders shall adopt local and national

- Disposal method for all waste identified in 4.5.3.1 is specified by the group manager

- All pesticide containers are treated according to the Pesticide Board recommendation of the triple rinsing

Group has established Procedure on Managing and disposable of waste, document number SOP-02/BK/2016 effective date 01/04/2016.

Record of chemical usage was sighted and available at smallholders buku rekod ladang (BRL).

Yes







Yes / No

legislation to dispose of hazardous chemicals and their containers.

(MAJOR)

and punctured - Assurance that collected containers

are not used to store food items or water for consumption.

The empty chemical container was stored properly and r reuse for chemical spraying purpose only.

4.5.4 Criterion 4 Natural water resources

4.5.4.1 Indicator 1 Independent smallholders can demonstrate that they understand the need to maintain the quality and availability of surface and ground water and steps are being taken for its implementation.

(MINOR)

Group manager should provide training on the following (where applicable)

- No intrusion to riparian reserve

- Maintain vegetation at riparian reserve

- Frond stacking

- Cover crops

- No blanket spraying

- Built and maintain terraces according to specification

- Silt pit

Training has been conducted by MPOB officer and all Pegawai Tunas Kawasan on 27/02/2018. Topics covered in the training:

- Land preparation for Palm Oil cultivation

- Manuring of oil palm.

- Pruning procedure

- Weeds control

- Factors that affect oil palm productivity.

- Buffer zone

Yes

4.5.4.2 Indicator 2 Water harvesting practices should be implemented.

(MINOR)

- Implementation of any forms of water harvesting

Smallholders collected rain water using containers to be used for chemical spraying.

Yes

4.5.5 Criterion 5 Status of rare, threatened, or endangered species and high biodiversity value area

4.5.5.1 Indicator 1 Independent smallholders should show a basic understanding of any

- Interview to test understanding on any species / habitats of concern, in compliance with Wildlife Department

Training has been conducted on 27/02/2018.

Training title Laporan Program Kursus Bengkel MSPO (SPOC Sibuti) 2018. The training has incorporate

Yes







Yes / No

species or habitats of concern, together with their conservation needs. Information on protected species and their habitat with high biodiversity value may be obtained from relevant government agencies, such as the Forestry Department, Forest Research Institute of Malaysia and the Wildlife Department.

(MINOR)

Malaysia and Forestry Department - Interview to test understanding on the

conservation needs of the rare, threatened, and endangered species (RTE) elements identified in above

Perlindungan hidupan liar which was based on the list provided by Sarawak Forestry Cooperation.

Smallholders are briefed on awareness of threatened and endangered species. Among species of animals sighted by smallholders are ‘Babi hutan, Landak, Burung Tekukur and monyet.

4.5.6 Criterion 6 Zero burning practices

4.5.6.1 Indicator 1 Independent smallholders shall not practice open burning during land preparation for oil palm cultivation or replanting, unless with the permission of relevant state authorities.

(MAJOR)

- Group manager should ensure that independent smallholders follow the GAP guidance on zero burning technique for replanting

- Observation on any evidence of open burning

MSPO Policy document number MSPO/SSCC/Polisi-01 states Perlaksanaan Pembakaran Sifar dan Amalan Pertanian Baik.

List of smallholders and planting statement has been reviewed.

Latest planting in 2017.

There is no open burning sighted during field visits. Smallholders are aware of the open burning policy and have been trained by the group manager.

Yes

4.6 Principle 6 Best Practices

4.6.1 Criterion 1 Site management

4.6.1.1 Indicator 1 All independent smallholders oil palm

- Verification of certification - Status of certification

Smallholder’s field is in good condition.

Example sighted on field, using slashing method for

Yes







Yes / No

farms shall implement best practices such as the MPOB Codes of Practice, Malaysian Standards, ISO Standards and and the Kod Amalan Baik (GAP) Pekebun Kecil.

(MINOR)

- Physical observation of implemented best practices that are practical for independent smallholders.

weed control rather than chemical spraying and. Ensuring at least two rounds of harvesting per month and proper harvesting schedule.

4.6.1.2 Indicator 2 A visual identification or reference system shall be established for each field or block of oil palm planting.

(MAJOR)

- Identification or reference system established for each field or block of oil palm planting.

Sighted signboard available at smallholder’s block. The list of information gained:

1) Smallholder No 83, Q 26.

Alamat Kebun: Kpg Keluru Jaya Sibuti

Keluasan: 1.51 Ha

Koordinat GPS: 113o55’19.3’’E4

o06’59.3”N

Tahun tanam: 2004

2) Smallholder No.15 Q 27.

Alamat Kebun: Kpg Muhibbah Sepupuk Niah

Keluasan: 5.172 Ha

Koordinat GPS: 113o42’27.3’’E 3

o51’53.7” N

Tahun tanam: 2004

Yes

4.6.2 Criterion 2 Economic and financial viability plan

4.6.2.1 Indicator 1 Group manager shall establish a documented business or management plan to demonstrate attention to economic and

- Documented business or management plan established, where applicable for field activities only

Budget for SPOC Sibuti was made by IMPAC (Institute of Malaysian Plantations and Commodities) which was under MPOB. Budget for field activities were made ad-hoc by the group manager. Cost will be applied on one month before the activities started. Sighted Tuntutan

Yes







Yes / No

financial viability.

(MAJOR)

Perbelanjaan Pendahuluan Dari Pelbagai by Pegawai Penyelidik MPOB Caw. Batu Niah dated 13/03/2017 to Ketua Unit Khidmat pengembangan MPOB.

Anggaran kos

Bil Perkara Anggaran Kos

Jumlah Kos

1 Makan & Minum

RM 15 x 60 RM 900.00

2 Honorarium penceramah luar

RM 70 x 3 RM 210.00

Jumlah RM 1110.00

4.6.3 Criterion 3 Transparent and fair price dealing

4.6.3.1 Indicator 1 Independent smallholders are encouraged to communicate with and have consultations with dealers, millers, local communities and other affected or interested parties.

(MINOR)

- Group manager should liaise with dealers, millers, local communities and other affected or interested parties and convey related information to members and/or

- Independent smallholders should liaise with dealers, millers, local communities and other affected or interested parties

Smallholders are independently sent their FFB to the dealers or mill. Daily price of FFB were obtained through message by the dealer or display on the notice board at FFB collection site.

Purchase of fertilizer and chemical was in made by smallholders themselves. Group manager does not involve in the process.

The communication smallholders with the weighbridge regarding the FFB pricing were sighted at the notice pricing at weighbridge by daily basis.

Minor non-conformity:

There are no evidence of engagement with stakeholders made by the group manager.

Minor NC 1







Yes / No

4.7 Principle 7 Development of new planting

4.7.1 Criterion 1 Oil palm shall not be planted on land with high biodiversity value

4.7.1.1 Indicator 1 Independent smallholders shall not plant oil palm on land with high biodiversity value as identified by local, state and national legislation.

(MAJOR)

- Group manager or relevant government agency should assist independent smallholders on Identification of High Biodiversity Value (HBV) area

- No development on HBV area

There are several new plantings conducted in 2017. Smallholders conducted new planting under MPOB Skim Tanaman Baru Sawit pekebun Kecil. Under the scheme, smallholders are required to fill the application form TBSPK number TBS01 (05/14) which required them to provide copy of grant. Only grant that permit agricultural activities will be accepted. For NCR land, acknowledgement by tuai rumah is required. The NCR land is previously plantedwith padi huma and fruit orchards.

Yes

4.7.2 Criterion 2 Soil Survey

4.7.2.1 Indicator 1 Independent smallholders should obtain information on soil types, topography and their suitability for oil palm plantings from the relevant government agency. New planting plans should be prepared in consultation with extension service officers

(MINOR)

- Group manager to provide soil and topography maps for cluster (where applicable)

Group manager has map provided by Jabatan Ukur dan Pemetaan Malaysia with scale of 1:50 000. The maps provided cover all areas of smallholders under SPOC Sibuti.

Yes

4.7.3 Criterion 3 Planting on steep terrain, marginal and







Yes / No

fragile soils

4.7.3.1 Indicator 1 Extensive planting on steep terrain, marginal and fragile soils, shall be avoided unless permitted by local legislation. Independent smallholders who establish new plantings on steep terrain, marginal and fragile soils, should adopt appropriate and viable conservation measures.

(MAJOR)

- Soil and suitability map for oil palm - Appropriate and viable conservation

measures - No development on unsuitable area

for oil palm

Group manager can provide these but is not practical for independent smallholders

There are no extensive planting in terrain and marginal soil. Sighted map location of smallholders and site verification on field.

Yes