Despite of the COVID-19 pandemic, Sinar Mas Agribusiness and Food remains committed to do its best to meet its 2020 target of reaching 100 percent traceability to the plantation for its palm oil supply chain, its executive said.
“Staying on course is an accurate description because the present, we continue to conduct a variety of sustainability practices in our businesses and reach a wider supply chain,” said Agus Purnomo, Sinar Mas Agribusiness and Food Managing Director, Sustainability, said.
Addressing an online press conference announcing the launch of the company’s latest “Staying on Course” sustainability report on August 4 2020, Purnomo said that the company was aiming at 100 percent supply chain traceability including up to its third-party mills.
He admitted that the COVID-19 with all its restrictions and health protocols could make it difficult for the company to reach its target. but added that the company remained committed to do its best.
“If in the next one or two months we can reach 90 percent and cannot reach 100 percent, we would still be thankful,” he said, adding that at present the company had already managed to be able to trace almost 80 percent of its supply across the company’s entire supply chain.
He said however, that the company remained optimistic it could reach its target by the end of 2020.
‘It has been five years since we launched the KSLG, the company’s huge endeavor, such as the ability to trace up to the plantation, or traceability to the plantation (TTP) and the transformation of the supply chain, and our follow up efforts to halt deforestation in our production have shown significant results and benefits,” he said.
KSLG is the social and environment policy of Golden Agri-Resources (GAR), of which Sinar Mas Agribusiness and Food is part.
But he said that in transforming the industry, Sinar Mas could not do it alone and there was a need for all stakeholders in the palm oil sector to join forces to achieve this transformation.
“Industry-scale transformation, such as in the palm oil sector which is facing a lot of challenges, can only be reached with daily efforts in the field, and this needs the collaboration and support from all stakeholders – our employees, our suppliers, our customers and consumers,” Purnomo said.
“We have a joint responsibility to remain on course to reach our aim,” he said.
For GAR, efforts to reach a transformation of a supply chain that is supported by traceability are supported by a number of engagement and capacity-building programs. These involve seminars on traceability, responsible labor practices, and Free, Prior and Informed Consent (FPIC) and also included the participation of suppliers in 2019.
The company also tries to effectively settle complaints in the supply chain using a structured involvement approach.
To enhance the resilience of communities around its concessions, Sinar Mas is also providing support for 40 projects under the Alternative Livelihood Program, in cooperation with local communities across Indonesia. They include the cultivation of organic vegetables and other crops such as coffee, and help improve the life of farmers and the livelihood of rural communities, especially in crisis times such as during the current COVID-19 crisis.
The company also said that it had reformulated almost all consumer products such as margarine and shortenings so that they are free from trans-fat.
To support programs to boost harvests, the company has produced some 2.5 million clones of Eka 1 and Eka 2 superior seedlings for oil palm replanting by the end of 2019. These new clones are able to produce more than 10 tons of CPO per hectare per year, or about triple the current average national yield in Indonesia.
The Chairman and CEO of Sinar Mas Agribusiness and Food, Franky O. Widjaja aired his conviction that the company was in a good and the right position to stay on course to reach its aim.
“The business model of Sinar Mas Agribusiness and Food that is vertically integrated and its sustainable operation are strengthening the resilience of the company amidst the rapid changes and disturbances to the industry, including during the current COVID-19 Pandemic,” he said.
With everything that the company had been able to obtain throughout the years, it hoped to be able to remain on the right course and continue to produce high quality palm oil that is produced in a sustainable way and continue to provide value for all its stakeholders, Widjaja said.
As of March 31, 2020, Sinar Mas Agribusiness and Food operates palm oil plantations covering almost 500,000 hectares, including those of its plasma scheme farmers.