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Wilmar International Ltd. continues to cooperate with third-party suppliers that do not comply with its no deforestation policy

According to a new report by the Indonesian NGO Greenomics, Wilmar International Ltd., a major Asian agribusiness, does not extend its highly acclaimed no deforestation policy to its third-party suppliers.1 The policy, launched in December 2013, involves commitments of ‘no deforestation, no peat, no exploitation’2 and claims to ban the development and burning of high carbon-stock (HCS) forests, high conservation-value areas and peatland while at the same time introducing best-management practices on existing plantations and respecting land-tenure rights with specific regard to indigenous people.3 The policy claims ‘These commitments will apply to all subsidiaries, refineries, mills that Wilmar owns, manages or invests in, regardless of stake and all third-party suppliers we purchase from or with whom we have a trading relationship’.4

These commitments are laudable, but to create impact must be enforced.  Evidence shows that third-party suppliers providing Wilmar with palm oil products continue to clear sensitive forest areas for palm oil plantations in Indonesia. Greenomics specifically refers to three third-party suppliers that do not adhere to Wilmar’s sustainability commitment, namely PT Citra Sawit Cemerlang (CSC) and PT Permata Sawit Mandiri (PSM) as suppliers of Malaysia’s Genting Plantations and PT Langgam Inti Hibrindo (LIH) as subsidiary of Provident Agro.1 CSC and PSM operate in the province of West Kalimantan on the Indonesian part of Borneo and hold concessions over forest area relinquishments affecting HCS forest and valuable orangutan habitat. LIH on the other hand has been associated with the clearing of forested deep peatlands on the Indonesian island of Sumatra.1 Yet, Wilmar has not defined whether these areas will fall under their new sustainability policy. Despite the importance of maintaining peatlands in order to reduce emissions from its clearance, LIH has continued its operations after the announcement of Wilmar’s no deforestation policy.

In response to the Greenomics report Wilmar has announced that it will investigate the matter, however the company has made clear that no “knee-jerk reactions” will be taken.5  Acknowledging that the implementation of the new policy down the supply chain is a gradual and challenging process, Wilmar clarifies that the policy will only apply to new areas developed after the announcement of the policy.6 In the light of the extensive positive PR for Wilmar subsequent to the announcement of the policy, Greenomics calls for a binding time commitment of Wilmar to implement the no deforestation policy and extend it to its suppliers’ operations to stop the blanket clearing of designated HCS forests, orangutan habitat and peatland.3 For more information on Wilmar International Ltd., please refer to the Facing Finance report Dirty Profits I.

  1. accessed 06.10.2014 [] [] []
  2. Wilmar no Deforestation – no peat – no exploitation: []
  3. accessed 06.10.2014 [] []
  4. Wilmar no Deforestation – no peat – no exploitation: []
  5. accessed 06.10.2014 []
  6. accessed 06.10.2014 []