SUSTAINABILITY

PACIFIC OILS & FATS INDUSTRIES SDN BHD RESPONSIBLE & SUSTAINABLE PALM OIL SOURCING POLICY

BACKGROUND

We, Pacific Oils & Fats Industries Sdn Bhd (PACOIL as a Refiner) support the vision of having a sustainable development/establishment of Palm Oil estates. Even though we are not grower of crops, we always support and work independently with industry partners to improve the quality of supply chain, the lives of farmers and communities that grow them.

The following principles define PACOIL’s conduct and business decisions on responsible sourcing and we expects our Business Partners to comply with our principles and share our commitments with regard to these principles and ensure all products shall be responsibly produced, maximizing yields and minimizing harm, in line with the following principles.

POLICIES REQUIREMENT

TRACEABILITY

PACOIL is committed to fulfilling the regulatory for 100% traceability up to the mills and with passage of time PACOIL will strive for full traceability to the plantation.

LEGALITY

PACOIL adheres to all applicable laws, environmental laws, regulations, industries standards and all applicable laws in our supply chain. PACOIL expect our suppliers to adhere to the applicable laws and encourage our suppliers to surpass baseline requirements where possible to reduce the environmental impacts of their operations.

REDUCTION OF GREEN HOUSE GAS EMISSIONS

PACOIL expect its suppliers to identify significant pollutants and greenhouse gas emissions, and work continuously to reduce greenhouse emissions and pollutant emissions from their mills and agricultural activities.

LAND USE

PACOIL do not own palm plantations and we source through other companies and work closely with customers and industry stakeholders to develop a sustainable supply chain for palm oil, palm kernel oil and their derivatives.

PACOIL committed to source Palm Oil and its derivatives that are sustainably produced and commit to the following standards in our palm oil supply chain

No Deforestation of High Carbon Stock (HCS) Forest
No Deforestation of High Conservation Value (HCV) Areas
No Development on Peatlands, regardless of depth
No Burning
Use of Chemicals
Reduction of Green House Gas Emissions
No exploitation of people and Local Communities

1. No Deforestation of High Carbon Stock (HCS) Forest

PACOIL commit to preserving High Carbon Stock forest- primary forests as well as High, Medium, Low Density and Regenerating forests as High Carbon Stock Forests. Young Scrub, Cleared/Open Land areas, existing plantations or other land already in agricultural production may be developed.

2. No Deforestation of High Conservation Value (HCV) Areas

PACOIL commit to preserving High Conservation Value land and we recognize that in some circumstances, non-forest areas particularly those with significant cultural or historical value may also be considered High Conservation Value land and such areas would fall within the scope of this policy.

3. No Development on Peatlands, regardless of depth

PACOIL shall remain committed to supporting RSPO Principles & Criteria Section 4.3 and the standards set forth in the RSPO manual on best-management practices for existing plantations on peatlands. We will not accept new development of peatland, regardless of depth, for palm production.

4. No Burning

PACOIL is committed to source from suppliers who prohibit use of fire as part of the land preparation and replanting or other related development. We maintain a no-burn policy as outlined in RSPO Principles and will not accept use of fire for the purpose of clearing land for palm plantation.

5. Use of Chemicals

PACOIL prohibits the use of paraquat and all WHO Class 1A and 1B chemicals by our suppliers in the production of palm products in line with food safety requirements and sustainability commitments.

6. Reduction of Green House Gas Emissions

Identify and reduce Greenhouse Gas Emissions in existing operations.

7. No exploitation of people and Local Communities

Respect and Support the Universal Declaration of Human Rights

PACOIL commit to upholding the Universal Declaration of Human Rights for all workers, contractors, indigenous people, local communities and anyone affected. We commit to no child or forced labor; unethical recruitment practices; no discrimination in our supply chain. Suppliers will comply to relevant laws and regulations and commit to proper working conditions from all aspects (safety and health, working hours & wages must be in accordance to International Labor Organization standards).

Respect and Recognize the Rights of All Workers including Contract, Temporary and Migrant Workers

PACOIL committed to ensure that the rights of all people working in any operation covered under this policy are according to local, national and international laws. We also commit to ensure international best practices where legal frameworks are not yet in place. The following principles are part of our policy:

Child labour -the company and its suppliers/sub-contractors shall not knowingly use or promote the use of child labour and shall take appropriate measures to prevent the use of such labour in connection with their activities.
Forced labour – the company and its suppliers/sub-contractors shall not knowingly use or promote the use of forced or bonded labour or human trafficking and shall take appropriate measures to prevent the use of such labour in connection with their activities.
Freedom of association – the company and its suppliers allow employees the freedom to form and join a trade union or engage in any form of collective bargaining if they chose to, subject to the extent permitted by law.
Document retention – the company and its suppliers/sub-contractors shall ensure that job seekers are not subject to the unlawful withholding of wages, identification cards, passports or other travel documents, or other personal belongings without their consent.
Employment contracts – the company and its suppliers/sub-contractors shall ensure that workers are given in writing, in a language that they understand, the details of their working conditions, including but not limited to the nature of the work to be undertaken, rate of pay and pay arrangements, working hours, vacation and other leave, and all other benefits of employment
Working hours – the company and its suppliers/sub-contractors shall ensure that workers are not working more than sixty (60) hours per week, including overtime; that overtime hours are worked on a voluntary basis; and that workers have at least one day off in seven.
Record keeping – the company and its suppliers/sub-contractors shall maintain a transparent and reliable record of working hours and wages for all workers
Wages – the company and its suppliers/sub-contractors shall ensure all workers are paid a wage equal to or exceeding the legal minimum wage.
Occupational health and safety – the company and its suppliers/sub-contractors shall protect workers from exposure to occupational health and safety hazards that are likely to pose an immediate risk of permanent injury, illness or death.
No discrimination – the company and its suppliers/sub-contractors shall ensure that workers are protected from any discrimination that would constitute a violation of their human rights;
Accommodations – When housing accommodations are provided, the company and its suppliers/sub-contractors shall ensure that they are adequate and safe with separate and segregated accommodations are provided for single men and women with no restriction of movement.

Land Tenure Rights

We recognize duties and responsibilities associated with tenure rights and respect them, such as respect for the long-term protection and sustainable use of land, forests, and fisheries. This is done in accordance with local laws and regulations of the country we are operating.

Rights of Indigenous and Local Communities to give or withhold their Free, Prior and Informed Consent (FPIC)

We respect and recognize the long-term customary and individual rights of indigenous and local communities, and commit to ensuring legal compliance as well as international best practices in FPIC are implemented

Resolve All Complaints and Conflicts

We will develop processes for the responsible handling of all complaints at the local, regional, national and international levels.

This will include working with relevant stakeholders such as the RSPO grievance panel to ensure that conflicts are resolved through mutually agreed processes that respect customary and individual rights and that ensure the free, prior and informed consent of relevant stakeholders to any resolution agreements.

SMALLHOLDERS

PACOIL commit to work with suppliers to ensure that the policy implemented will supports the inclusion of smallholders as their supply chain

MONITORING AND EVALUATION

PACOIL commit to maintain an open approach in responding to new issues arises from monitoring and evaluation processes. We understand that as new issues and new technologies become available, new policies and practices will need to be develop and revised from time to time.

TRANSPARENCY AND TRACEABLE SUPPLY CHAIN

Traceability:

PACOIL will work towards a traceable, transparent and responsible supply chain.

Grievances:

PACOIL will establish a transparent grievance mechanism including an avenue for stakeholders to report grievances and a process to resolve complaints within our supply base. We will work with relevant parties to resolve complaints and conflicts through an open, transparent and consultative process in a timely manner.

Continuous Improvement:

PACOIL will work towards continuous improvement to meet the standards and expectations of stakeholders in an evolving global market.

TIME BOUND

We have achieved 100% full traceability to mills in 2020

In moving forward toward sustainable sourcing of palm oils and its derivatives, PACOIL will try our level best to achieve the following goals:

-Achieve full traceability to plantations by 2025

-Purchase 100%certified sustainable palm oil and palm kernel oil by end 2030

We will collaborate with suppliers and other relevant stakeholders to develop time-bound plans and to move toward implementation of above commitments.

RSPO

PACOIL will continue to promote and increase RSPO-certified oil to serve customers. However, for us to do so, it will require much effort from all relevant parties.

OTHER MEASURES

PACOIL will engage actively with stakeholder to improve the effectiveness of our effort to promote sustainable palm oil, palm kernel oil and palm derivatives.

SUPPLIERS

Suppliers of Palm Oil, Palm Kernel Oil and palm oil derivatives are to be evaluated with our policy expectations. If there are suppliers who do not meet our policy expectations, we will work with them to develop an action plan with time bound commitments.