Sustainability

Our traceability

As a part of our public commitment to increase transparency in our supply chain, since 2017 Lipsa publicly discloses the traceability details of our palm oil and derivatives supply chain.

In H1 2022 we reached 100% traceability to the mill and 56 % traceability to the plantation.

Find below our H1 2022 full mill list.

Lipidos Mill Database_H1 2022

Supply chain schema

Grievances

LIPSA is committed to respond and take action against any violation of its NDPE Policy detected in its supply chain. Our grievance procedure and decision trees allow us, jointly with the collaboration of our suppliers, to correct any bad practices detected.

Public grievance list

LIPSA investigates all grievances received jointly with the commitment of its direct suppliers and its sustainability partner, the Earthworm Foundation. Below are the grievances we are involved in:

Latest update: 16/11/2022

Grupo Hame

Data received: 19/06/2018
Summary of Grievance: Human Rights violations. Corruption Environment pollution (river contamination).
Grievance source: Various NGO's
Status: Monitoring
Progress Updates and Resolution: We are currently monitoring REPSA jointly with the help of Earthoworm Foundation. We conducted a field visit in November 2018 and implemented montly check-in calls with REPSA to monitor their progress. REPSA demonstrated their commitment and have several work streams in place to address all the environmental, governance and social issues. REPSA are periodically publishing the Progress Report about labour, human rights, environment and transparency. We reduced the frequency of our monitoring to punctual check-in.

Genting Plantation

Data received: 26/08/2019
Summary of Grievance: Orangutans killed in its plantations, recent 2019 deforestation in Genting concessions and labour issues.
Grievance source: Various NGO's: Migthly Earth Reports, Greenpeace
Status: Suspended
Progress Updates and Resolution: Lipsa has decided to suspent Genting plantations of our purchase list as there is not alignment with our principles and NDPE Policy. We are enging and monitoring our direct supplier who is currently engaging Genting Plantations.

Samling / Gleanealy

Data received: 26/08/2019
Summary of Grievance: Samling and their palm oil company Glenealy have been campaigned against by NGOs for years for widespread NDPE violations in multiple countries, including Malaysia, Indonesia, Myanmar and PNG, Liberia, and Cambodia.
Grievance source: Various NGO's: Migthly Earth Reports, Greenpeace
Status: Suspended
Progress Updates and Resolution: After engaging with our direct supplier and revised the case Lipsa has decided to suspend Samling/Gleanealy plantations of our purchase list as there is not alignment with our principles and NDPE Policy.

Industrias Chiquibul

Data received: 29/09/2022
Summary of Grievance: Violations to labour rights and an ecocide related to the pollution of a local river.
Grievance source: CONDEG (National Council of Displaced Guatemalans)
Status: Monitoring
Progress Updates and Resolution: There have been several complaints done by CONDEG to the Guatemalan government: These complaints were mainly related to labour practices of Chiquibul constituted indicators of human trafficking and forced labour and other severe forms of labour exploitation: demanding excessive work goals, excessive use of contractors to avoid giving workers the full protection of permanent contracts, no payment of minimum wage, abusive hiring practices, child labour, right to defend human rights, etc. One complaint about ecocide in July 2019. The pollution of the stream that connects with the San Román River, which feeds into the Salinas River and to remediate the communities affected. Lipsa is indirectly connected with Industrias Chiquibul. We have engaged our direct supplier with this case. Industrias Chiquibul, in their public response to this engagement, states that they are in compliance with laws and regulations established in Guatemalan law. They also stated that the last complaint in relation to the exploitation of indigenous women are dismissed by the labor ministry as it seems the case lacks supporting evidence. Chiquibul also reiterates they will continue complying with current labor regulations and furthermore they have been recently certified by ISCC EU on March 2022. Lipsa still has open the case and will engage directly with Industrias Chiquibul and our tier one supplier to investigate the status of the complaints shared by CONDEG and be able to have all the information needed to make decisions.

FGV Holding Berhard

Data received: 01/10/2020
Summary of Grievance: Human rights violations and violations of principles and fair labour practices.
Grievance source: Mighty Earth, International Labor Rights Forum (ILRF), US border and customs and RSPO
Status: Monitoring
Progress Updates and Resolution: Since October 2020 we are monitoring Felda through our first-tier supplier engagement.
On August 2015, RSPO has sanctioned FGV over forced labor, worker trafficking, and 25 breaches of the RSPO's sustainability certification criteria on FGV plantations.
On August 2019 RSPO lifted the suspension.
On 13th January 2020 RSPO published a letter suspending FGV's P&C Certificate for Kilang Sawit Serting and all certification processes at each uncertified management unit within FGV.
On 15th January 2020, FGV issued a statement to clarify their position. On 24 January 2020, FGV issued a second statement. Several progress reports related to RSPO Complaint cases have been published by FGV: on 10 April 2020, 7 July 2020 and 29 July 2020.
On 30 September 2020, the United States Customs and Border Protection (CBP) issued a Withhold Release Order (WRO) of palm oil and palm oil products made by FGV at all U.S ports of entry. On 1 October 2020 FGV has issued a statement in response that clarifies that the issues raised by the CBP have been the subject of public discourse since 2015 and that the company has taken several steps to correct the situation.
In addition, Fair Labor Association (FLA) issued a progress report on FGV and RSPO published a statement on this issue too.
In November 2020, FGV adopted its revised Group Sustainability Policy (GSP) in which provisions on labour were strengthened based on the FLA Workplace Code of Conduct.
In February and March 2021, the FLA conducted a second validation exercise to assess FGV’s progress in implementing its action plan.
FGV has stablished a Committee on Gender Equality and Women empowerment in February 2021. These initiatives are part of FGV’s efforts to improve its labour practices and address concerns raised by the US CBP in relation to the 11 International Labor Organisations (ILO) indicators of forced labour.
On 22 March 2022 RSPO closed the complaint and proceed to Post Complaint Monitoring. FGV continued to carry out corrective actions on the ground and continued to provide periodic update to the Complaints Panel via the Risk Unit of the RSPO Secretariat. The complaints Panel also takes note of the audit report that was produced by the Certification Body following a series of verification audits carried out against FGV in 2021. FGV had discussions with their US-based legal counsel and has appointed ELEVATE as the independent auditing firm to conduct an assessment of FGV's operations against the 11 ILO Indicators of forced labour, which is expected to begin in November 2021.
We will continue monitoring the progress of FGV through our tier-one supplier engagement.

Sime Darby Plantation Berhad

Data received: 04/01/2021
Summary of Grievance: Alleged human rights and labour abuses: Forced Labour and Child Labour.
Grievance source: Liberty Shared, US border and customs
Status: Monitoring
Progress Updates and Resolution: On 20th April 2020, Liberty Shared (LS) issued a petition to United States Customs and Border Protection (US CBP) to exclude product from Sime Darby Plantation (SDP). The petition concern allegations of forced labour and child labour by SDP owned and affiliated companies.
On 30 December 2020, the United States Customs and Border Protection (CBP) issued a Withhold Release Order (WRO) that all U.S. ports of entry will detain palm oil and products containing palm oil produced by SDP and its subsidiaries, joint ventures, and affiliated entities in Malaysia.
SDP issued a statement in response to the WRO on 31 December 2020, which reiterated SDP’s commitment to combatting forced labour. The statements also indicated that CBP has not provided sufficient information to allow SDP to meaningfully address the allegations that triggered the issuance of the WRO, and they are looking forward to receiving pertinent information and working with CBP in order to quickly resolve the matter. SDP reiterates its commitment to uphold labour practices and human rights and to implement appropriate corrective actions to eradicate human rights infringements. These efforts include the appointment of PricewatershouseCoopers Consulting Associates on 19 October 2020 to establish effective platforms and channels of communication to address any concerns or issues surrounding their operations in Malaysia.
On 28 January 2022 US CBP issued a statement on their finding, determining that certain palm oil and derivate products were made wholly or in part with palm oil produced by SDP, its subsidiary and joint ventures with the use of convict, forced or indentured labour.
On the same day SDP issued a response, highlighting that since the initial WRO on 16th December 2020 SDP have fully cooperated with the USCBP, and continue to try and resolve these issues even through progress has been slowed due to Covid-19 restrictions across Malaysia.
On 28 January 2022 RSPO also release an statement explaining that following the WRO RSPO Secretariat commenced an independent verification process to identify whether the allegations and/or any non-conformities had occurred on any of SDPs certified units. Due to the numerous Malaysian government-mandated Movement Control Orders (MCOs) caused by the pandemic throughout much of 2021, the RSPO Secretariat and independent assessors have been unable to conduct an on-ground verification to date, and therefore, the inquiry is still ongoing.
Lipsa will follow up closely the case jointly with our tier one supplier and will come with a decision once the RSPO investigation will be close.

LKPP Corporation Sdn. Bhd.

Data received: 19/04/2021
Summary of Grievance: Reports of deforestation
Grievance source: Mighty Earth. Palm Oil Report: 30
Status: Monitoring
Progress Updates and Resolution: LKPP was reported in Mighty Earth Rapid Response report for 22ha deforestation at Ladang Cherating (Pahang) in the period of Mar-19 to Oct-20 and 101ha deforestation at Sg. Charu (Pahang) in the period of Feb-19 to May-20.
Our trading partner has engaged this supplier. PKPP has agreed to put a stop to all land clearing activity at Ladang Cherating concession (https://ndpe.pkpp.gov.my/bulletin.html). A ‘suspension of work order’ on all future planning involving the new development of palm oil plantations has also been issued to the group.
The PKPP management has set aside two land banks located at Lipis, Pahang (426 ha) and Pekan, Pahang (130 ha) for its recovery plan.
In Jan 2021, PKPP launched a sustainability dashboard that summarized its sustainabilty commitment and progress on public platform. The PKPP NDPE policy is publicly available at https://ndpe.pkpp.gov.my/.
We will continue monitoring progress closely with our supplier.

SARAWAK OIL PALMS BERHAD

Data received: 19/04/2021
Summary of Grievance: Reports of deforestation
Grievance source: Mighty Earth. Palm Oil Report: 17,18,20
Status: Monitoring
Progress Updates and Resolution: According to our trading partner, SOPB launched their NDPE policy in Feb 2019, and suspended all development of forest since 1 July 2018, unless HCV-HCS undertaken. SOPB has its own board of directors and claims to operate independently of Shin Yang.
- Mighty Earth Rapid Response report #18 shows 127 ha clearance between June 11, 2019 and August 5, 2019 in the Shin Yang OP Planting area (LPF/0018) concession. According to our trading partner, the alleged clearance had taken place at License for Planted Forest (LPF) area which was outside their oil palm plantation area.
- Mighty Earth Rapid Response report #17 shows 548 ha clearance between February 27, 2019 and May 27, 2019 in the Dataran Linau Sdn Bhd concession. According to our trading partner, the alleged clearance has happened outside Sarawak oil's concession.
- Mighty Earth Rapid Response report #20 shows 4 ha clearance April 22, 2019 and September 23, 2019 in the Dataran Seping Sdn Bhd concession. According to our trading partner, reported company had confirmed that the alleged clearance had taken place inside its concession area. However, based on ground verification, the clearance reported was found to be due to encroachment by some local communities for the purpose of paddy planting. As the clearance activity is considered as encroachment, the reported company had met the local communities on 10/11/2019 to highlight the issue in order to prevent future encroachment inside its concession area.
We will continue monitoring progress closely with our supplier.

GRUPO OCHO SUR

Data received: 18/10/2022
Summary of Grievance: Violation of social and human rights and deforestation cases.
Grievance source: Business and Human Rights resource center
Status: Monitoring
Progress Updates and Resolution: Several accusations of land tenure violations and community conflicts. Accusations of deforestation and operations without environmental permits in place affecting natural forests and ecosystems in Nueva Requena. Lipsa is indirectly connected with Grupo Ocho Sur through our direct supplier LDC. We have engaged with LDC. Our direct supplier has responded to this allegation. You could see their public response to it: Louis Dreyfus' response on alleged supply chain links to harmful palm oil - Business & Human Rights Resource Centre (business-humanrights.org). Lipsa have received from LDC a detailed answer of their engagement with Ocho Sur that includes a field visit to the operations and stakeholders review. Lipsa still have the case open as we need further clarifications on specific issues. We are still under engagement with our direct supplier to be able to have all the information needed to make decisions.