KUALA LUMPUR (Aug 5): After a four-month suspension that began on April 1, the Roundtable on Sustainable Palm Oil (RSPO) has decided to lift the suspension of RSPO certification for the entire IOI Corp Bhd.
The lifting of the suspension of the RSPO certificates will be effective from Aug 8, said the RSPO Secretariat in a statement today.
"We wish to inform that the RSPO board of governors has endorsed the recommendation made by the complaints panel to lift the suspension of RSPO certification for the entire IOI Group," said the RSPO Secretariat.
The complaints panel, said the secretariat, is satisfied that IOI Group has met the conditions set out by the RSPO in its letter to IOI Group dated March 14, based on the actions that the group has taken and implemented since then.
It said the initial suspension of IOI Group's RSPO certificates came into force on April 1, following a decision taken by the complaints panel on March 14, and endorsed by the RSPO Board of Governors on March 25, in relation to the complaint against four subsidiaries of the IOI Group, i.e. PT Sukses Karya Sawit, PT Berkat Nabati Sawit, PT Bumi Sawit Sejahtera.
"The RSPO welcomes the good progress achieved so far towards the resolution of this case, as confirmed by both parties involved in a recent joint statement.
"However, the board of governors wish to make it clear that the implementation of the action plan by IOI Group shall be subject to an independent ground verification by a team of experts. These experts will be appointed by the RSPO Secretariat within 30 days from the date of this letter," said the secretariat.
The findings of the independent ground verification team shall be scrutinised by the RSPO complaint panel, it said.
If the verification team finds significant failures in the implementation of IOI Group's commitments to the RSPO — in correcting deficiencies that led to IOI Group's certifications being suspended in the first place — the complaint panel will advise the board of governors to re-impose the suspension with immediate effect.
"IOI Group shall continue to submit its quarterly progress report as mandated by the complaint panel, in its letter of May 5, 2016. At the end of a 12-month period, the complaint panel shall again commission an independent ground verification by a team of experts, following which a review of the complaint will be undertaken by the panel," it said.
The panel shall then determine whether the implementation of the action plan is satisfactory, and set any other conditions for the continued progress of the resolution of the complaint, it added.
IOI Corp, one of the founding members of the RSPO, had announced in late March that its RSPO certification for its entire oil palm production would be suspended from April, following complaints of violation of RSPO criteria by non-governmental organisations against the plantation estates of IOI Corp's Indonesian subsidiaries.
The announcement came after sustainability consultants Aidenvironment submitted a formal complaint to RSPO in that same month, alleging deforestation in IOI concessions in Ketapang, among others.
Prior to the update today from the RSPO Secretariat, IOI Group and Aidenvironment had, in a joint statement dated July 28, said there had been significant progress made in resolving the Ketapang complaint case.
They also agreed on several main actions, including the immediate removal of all 'overplanted' oil palms by IOI Group, and that the company will have in place legally required fire prevention and mitigation measures and commence the implementation of an integrated peat.
IOI Corp's share price, which has been sliding since end-March to touch as low as RM4.12 -- as notable customers like Nestle, Unilever and Kellog cut ties with the group -- has shown signs of recovery since the start of June.
It gained 22 sen or 5.2% to close at RM4.45 today, after 16.84 million shares were traded, for a market capitalisation of RM27.98 billion.
The counter was the fifth top gainer of the day on the local bourse.