SUSTAINABLE PALM OIL SOURCING POLICY

(incorporating No Deforestation, No Peat & No exploitation NDPE)

Version 1 - 01 April 2021

Agritrade Co Ltd Responsible Palm Oil Policy

 

Introduction and Scope

 

Palm oil is a crucial edible oil that offers job opportunities, empowers communities, and supports livelihoods. On one hand, it is known to be one of the most cost-effective oilseed crops as it has the highest yield per hectare while using the least area compared to other vegetable oil crops. On the other hand, the production of palm oil has revealed undeniable concerns over human rights abuse and exploitation of the local communities and lands. 

 

To help address and recognize these challenges, Agritrade is committed to supply palm oil responsibly by safeguarding the environment, and supporting the communities living and working in palm oil plantations. Agritrade believes all agricultural supply chains should be environmentally sustainable and economically beneficial to local communities. 

 

This policy is applicable as of April, 1, 2021 to all purchasing operations and we expect all our third-party suppliers of oil palm products and its derivatives to adhere to these commitments in their operations. Agritrade will work to ensure that our third-party suppliers comply to our policy and Agritrade will only source through transparent and traceable network. 

 

Our Commitments 

 

To achieve our long-term commitments for a sustainable palm oil industry, we aim to ensure a transparent, traceable, and responsible supply chain by adopting no deforestation, no peatland planting and no exploitation of local communities and workers in palm oil plantation. 

 

Agritrade’s commitment is further explained in the following core items; 

1.     Compliance 

2.     Environmental Responsibility 

3.     Social Responsibility 

4.     Engagement and Inclusivity 

5.     Transparent and Traceable Supply Chain 

 

 

1. Compliance  

1.1 Legal Compliance:

 

Agritrade abides by all national laws and existing industry best practices in its operations and sourcing of palm oil. We expect our third-party suppliers to adhere to national legislation including compliance with national certification requirement, if any.  

 

                             

1.2 RSPO:  

 

Agritrade has been an RSPO member since 2016 and is enthusiastic about engaging and maintaining a dialogue with its business associates, clients, and wider stakeholders to achieve the mutual goal of responsible and sustainable palm oil procurement.  

 

We are committed to engaging our suppliers to implement RSPO best practices and standards within their operations.  We will work to strengthen the RSPO standard and its enforcement. 

 

2. Environmental Responsibility  

 

2.1 No Deforestation:

 

Agritrade will not knowingly source palm oil from plantations established on areas of significant environmental or cultural importance as of 1 April 2021. These include High Conservation Value (HCV) areas and High Carbon Stock (HCS) forests as assessed under accepted methodologies. 

 

2.2 No Peat: 

 

Agritrade will not accept any new development on peatland regardless of depth. On existing peat plantations, best management practices for peat plantations must be implemented, preferably in accordance with the RSPO BMP Manual on Peat. 

 

2.3 No Exploitation: 

 

We expect our suppliers to follow the United Nations Global Compact Principles on Business and Human Rights section of which Agritrade is a proud member. 

 

2.4 Zero Burning: 

 

Agritrade will not accept the use of fire / burning in oil palm production. 

  

3. Social Responsibility                                                                                                  

3.1 Human Rights: 

 

Agritrade is committed to respect and protect human rights. The rights of all workers regardless of their gender, ethnicity, nationality, and religion are all of equal importance and the elimination of discrimination in employment, promotion of equal rights will strictly not be tolerated. 

 

3.2 Indigenous and Local Communities:

 

Agritrade recognises and respects the rights of indigenous and local communities to give or withhold their Free, Prior and Informed Consent (FPIC) to operations on lands to which they hold legal, communal, or customary rights. In line with this, we will not knowingly source from areas developed after 1 April 2021 that have not undergone a FPIC process with indigenous and local communities. 

 

3.3 Fair Labour:

 

Agritrade is against the use of child labour, forced or bonded labour in its operations and its third-party suppliers. Agritrade believes that workers should have access to a grievance mechanism, be paid at least the legal minimum wages, have access to passports, identification cards, personal documents and belongings, be provided with fair contracts, access to freedom of association, and decent work and living conditions. 

 

3.4 Health and Safety:

 

Agritrade shows zero tolerance to harassment in workplace; and asks its suppliers and business partners to ensure a safe and secure working environment for their workers. 

4. Engagement and Inclusivity

 

4.1 Supplier Engagement:

 

Agritrade will engage with the key suppliers to fulfil the commitments and policies. This will include verification and monitoring of grievances, policy compliance, and supplier progress towards meeting our responsible sourcing policy. 

 

4.2 Client Engagement:

 

Agritrade is committed to share the sustainability mechanisms for improvement with our clients.  

 

4.3 Smallholders:

 

Agritrade is committed to supporting the inclusion of smallholders in the supply base. In line with this, Agritrade will support actions and programmes among associates to increase capacity for smallholders. In addition, for non-complaint smallholders, Agritrade will quit buying from them; yet will still ask them to fulfil the requirements and encourage them to abide by the globally recognised requirements.

 

5.Transparent and Traceable Supply Chain 

 

5.1 Traceability:

 

Agritrade is committed to a transparent and traceable supply chain. 

 

Agritrade will work with its suppliers to achieve full traceability to mill by 2022. 

Agritrade will engage with suppliers to disclose data on traceability to plantation.

 

6. Grievances:

 

Agritrade highlights the importance of a transparent grievance mechanism to report incompliances and a process to resolve complaints within the supply base. We will work with relevant parties to resolve complaints and conflicts through an open, transparent and consultative process in a timely manner. The grievance mechanism will be detailed in Grievance Procedure.

 

7.Continuous Improvement: 

 

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

Agritrade commits to publish annual progress reports towards achieving the commitments. 

 

We will continue to improve the policies and engage in a constant review and improvement process. As new requirements are implemented, Agritrade will adjust and improve our policies in ways that are consistent with our overall sustainability commitments of protecting forests, peat lands, indigenous and local communities, and human rights.