Huge palm oil company promises to end deforestation

World’s second largest palm oil producer commits to conserving precious Indonesian rainforest and to leading the industry towards sustainable practices

The world’s second highest palm oil producer has announced it will halt the destruction of key areas of Indonesia’s forests previously caused by its operations and will lead a transformation in industry practices.

Golden Agri-Resources Limited (GAR), an arm of conglomerate Sinar Mas, said it will work with the government of Indonesia and The Forest Trust to create a “fully sustainable palm oil industry,” while helping the Indonesian economy and raising the living standards of local communities.

The company said it will take a “holistic approach” towards meeting its comm-itments, central to which is a pledge not to clear ‘high carbon storage’ forest and areas with significant biodiversity. GAR has drawn up a conservation policy in collaboration with The Forest Trust, which aims to ensure that its activities have “no deforestation footprint” and respect the rights of indigenous and local communities.

Scott Poynton, executive director of The Forest Trust said GAR’s commitment is the fruit of many discussions and field visits. “The company told us it was serious about leading the effort to solve the issue of deforestation facing the palm oil industry,” he said. “If we get it right, it will be huge for Indonesia’s forests and the people and biodiversity that depend on them; not to mention a shot in the arm for the fight against climate change.”

“Protecting Indonesia’s forests is good for business, the environment and future generations of all Indonesians. The need for other palm oil producers to clean up their act is now pressing, for business and environmental reasons.”

GAR has called to other industry members and independent experts to work alongside the company in creating a sustainable palm oil industry in Indonensia. The chairman and CEO, Franky Widjaja, said: “This is the first step towards a wider collaboration… We look forward to a constructive dialogue and it is only with this multi-stakeholder participation that we can succeed.”

The Indonesian government welcomed the announcements. Mahendra Siregar, vice minister of trade of Indonesia said: “We are supportive of this ‘lead by example’ partnership that would encourage all players to participate in this process, at this stage and beyond.”

In recent years, investigations by Greenpeace into the destruction caused by the palm oil industry have triggered international corporations, such as Unilever and Nestle, to drop their contracts with GAR. The company was also criticised last year by The Roundtable on Sustainable Palm Oil for its environmental and social practices.

GAR’s plans do not prevent it from exploiting other areas of forest, deemed to be less valuable in conservation terms. However, Greenpeace said that the new commitments could signal the start of a shift throughout the industry and eventually lead to full forest and peatland protection.

Bustar Maitar, head of Greenpeace’s campaign to protect Indonesian forests, said that on paper, the pledge is a major step forward. “This could be good news for the forests, endangered species like the orang-utan and for the Indonesian economy,” he said. “And if they do make these changes, large areas of forests will be saved.

He added that it is time for government to back such efforts: “Golden Agri’s announcement has given a huge boost to the Indonesian president’s pledge to protect forests and tackle climate change. And now the Indonesian Government must support this initiative by stopping any more licences being granted for forest and peatland clearance, and by reviewing activities in areas where licences have already been handed out.”