2. Summary of the Findings by Criteria

SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 23 of 82

C. 2. Summary of the Findings by Criteria

1 COMMITMENT TO TRANSPARENCY

1.1 Palm oil growers and millers provide adequate information to other

stakeholders on environmental, social and legal issues relevant to RSPO Criteria, in appropriate languages forms to allow for effective participation in decision making. Company has established SOP of Response to Request and Information SOPSPOSMARTLH-01. List of information is in place that is accessible to relevant stakeholders, which is different between mill, main estate and plasma estate. Estate Manager is responsible for providing stakeholders with relevant information particularly information relating to social aspect. In the Mesuji Plasma Estate, the person in charge of social aspect was appointed by the management through the letter of appointment no 016RC-LAMPUNG012012 that the MSJA Manager is responsible for social aspects and communication with stakeholders. All communication is recorded in the communication book for all stakeholders internal and external. The majority of requests found in the list of stakeholder request are clean water supply request from the Community of Brabasan Village. Sampling is conducted on the Letter of request from Brabasan Village Manpower and Transmigration Service asking for labor and grass cutting equipment assistance, dated 12 Feb 2013 under the name of Drs. Rozali. Company has responded by providing assistance on 23 Feb 2013 evidenced by the minutes of hand-over of 1 unit of grass cutting equipment along with the operator. All forms of request for information are filed in a folder and indexed according to the date of incoming letter. For GALA Plasma Estate, personnel responsible for communication with stakeholders are the GALA Manager who is established with management decision letter no. 12SK-RC- LampungIV2013. Any requests for information are recorded in log book. Recorded information requests comprise routine reports to government agencies in need. Communication and Consultation are recorded in a separate log book. In general, most request letter is asking for assistance of road repairs and surfacing from surrounding communities. Sampling was conducted on the letter of request from the Paduan Rajawali Village Chief dated 8 November 2012 containing a request for heavy equipment assistance. Company had followed it up on 26 November 2012 by conducting road repairs using Grader in Paduan Rajawali Village, Meraksa Aji District -Tulang Bawang and evidence of completion had been documented in the form of Minutes. The records of information requests and responses are kept with retention time of 10 years. Compliance status: Full Compliance 1.2 Management documents are publicly available except where this is prevented by commercial confidentiality or where disclosure of information would result in negative environmental or social outcomes Confidential documents are documents outside the list of information to Stakeholder, such as commercial data and data causing negative impacts that are accessible only upon management’s approval, e.g. conflict data. In general, data may be accessed asked by relevant stakeholders as long as relevant. In addition there are data that can be given only to relevant agencies, for example production data is given to the Regency and Provincial Plantation Service. SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 24 of 82 Compliance status: Full Compliance 2 COMPLIANCE WITH APPLICABLE LAWS AND REGULATIONS 2.1 There is compliance with all applicable local, national and ratified international laws and regulations. Company has made periodic evaluation of all regulations which is regulated through SOPSPOSMARTLH03 Legal and Other Requirements rev 01, which is evaluated per semester. Central office’s Sustainability division performs evaluation and the results are communicated to the units estates and mills, which in turn will select those regulations relevant to them. Sampling of Mesuji Estate, personnel responsible for ensuring compliance with regulations related to ‘sustainable palm oil’ is under the responsibility of Sustainable Palm Oil Officer stipulated in decision letter no. 03EM-MSJAVI2013. Company sorts regulation list according to the aspect s: environmental aspect, estate aspect, permit aspect, employment and occupational safety and health OSH aspect. Evidence of evaluation of the most recent regulations such as PP no 272012 relating to environmental permit has conformed. Other sampling of evidence of compliance with regulations has conformed such as company has conducted reporting routinely to relevant agencies, for example routine report to Jamsostek worker’s social security. Company previously has operating permit of one 1 mill for the capacity of 30 tonhour. At the time of preliminary audit, a nonconformity was found in which the company had two 2 Milswith a capacity of 60 tonhour each, totalled 120 tonhour. At the time of certification audit, the company had been following it up by processing the IUP for Mills of 120 ton FFBhour capacity. The company already has a letter from the Board of Investment and Regional Integrated Permit Service with No. 800200BID.VII.062013 dated 1 July 2013 for the management of mills with a capacity of 120 ton FFBhour. Compliance status : Full Compliance 2.2 The right to use the land can be demonstrated, and is not legitimately contested by local communities with demonstrable rights Company already has a letter from Forestry Department, Regional Office of Lampung Province no. 1052Kanwil-6TGH 13490 dated 16 July 1990 stating that the area managed by PT Sumber Indah Perkasa, which is located to the East and bordering with permanent production forest of Sungai Buaya Reg.45,is not overlapping with the forest area. Company has a Decree of Governor No. C202DAHK 1989 on Land Site permit and land use totaling 9,000 Haunder the name of PT Sumber Indah Permai. After that, there are site permit changes no. C309BPHHK1990 to become 9,522.11 Ha. Company previous name is PT Sumber Indah Permai and then changes name to become PT Sumber Indah Perkasa. Change in the company name has been notarized by a Notary Deed dated 20 September 1990 Benny Kristianto and associate and secured in the Decree of the Minister of Justice no. C2-5826 HT.01.01.Th90.HK1990. Company already has a certificate of HGU from BPN with no. 1HGUBPN93 totaling 9,522.11 Ha dated 30 January 1993. Company already has a certificate of HGU that consists of : HGU issued by the Regency of North Lampung with no. 08.04.15.01.2.00014 dated 21 July 1993 SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 25 of 82 totaling 5,058.82 Ha for the location of SBYE and SBYM. All HGUs will expire in 2027. Company already has IMB no. 6422456506001995 totaling 5,995.4 M 2 for PKS SBYM. Compliance status: Full Compliance 2.3 Use of land for oil palm does not diminish the legal rights, or customary rights, of other users, without their free, prior and informed consent. Company is a takeover from earlier company in 1990. Company states that during the period from 1990 until the time of the audit there was no purchasing of land. There is SOP of Land Conflict Settlement SOPSPOSMRTLH-04. So far the company and KUD inform that there was no dispute during the period from 2010 to the present time in the area around company site. It is said in the SOP to prioritize deliberation over legal action. At the time of audit the Location Map of PT. Sumber Indah Perkasa No. Reg: 948214PMNPVI12 with the scale of 1 : 250,000 were showed. The map should have a sufficient scale of minimum 1 : 100,000 in accordance with Decree of the Ministry of Forestry No. 48menhut-II2004. Compliance status : Observation no. 5 3 COMMITMENT TO LONG-TERM ECONOMIC AND FINANCIAL VIABILITY 3.1 There is an implemented management plan that aims to achieve long-term economic and financial viability PT SIP long term replanting program up to 2020 has been established. The replanting plan will commence in 2017 up to 2020 covering 5 estates with a total area of 23,443.87 Ha. For plantations under the SBYE Estate, including MSJA and GALA, replanting area is determined as follows : - 2017 planting year TT 1991 is 513.14 ha ; - 2018 TT.1992 is 2,720 ha ; and - 2019 TT.1993 is 1,118 ha ; Company has financial statement that has been audited by the public accountant office of Tanubrata Sutanto Fahmi Rekan, in 2011. Tax report data for 2012 was not available yet but there is a statement letter dated 16 April 2013 issued by the public accountant office that it is under audit completion process. Compliance status : Full Compliance 4 USE OF APPROPRIATE BEST PRACTICES BY GROWERS AND MILLERS 4.1 Operating procedures are appropriately documented and consistently implemented and monitored - SOP and WI related to new planting, issued 172010. - SOP on New Land Opening SOPSMARTMCARIVTA-PLB, rev.0, issued 192012. Point 2.2.6 Preparation regulates on: terracing and horseshoe shaping tapak kuda. SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 26 of 82 - There is IK SMARTRMCARTA-PPA01 on Drainage - Records of nursery maintenance are not available since there is no longer nursery activity. - SOPSMARTMCARVTA-TNM, 192012. SOP on Planting - There is IKSMARTMCARVTA-TNM01- Lining Flat to Wavy Area and also guidance table from Plant Density in Flat Area. - In SOP and orWIthe plant density is set at 136ha. In general, the company already has SOP on Land Preparation Technical Guidelines Palm Oil that constitutes a collection of SOP and WI related associated with new planting. issued 172010. SOP on New Land Opening SOPSMARTMCARIVTA-PLB, rev.0, issued 192012.Point 2.2.6 Preparation regulates on: terracing and horseshoe shaping tapak kuda. Also, there is IK SMARTRMCARTA-PPA01 on Drainage system. There are SOP on Nursery Bed SOPSMARTMCARIIITA-BBT, rev.00,192012 and IKSMARTMCARIIITA-BBT06, Seedling Acceptance and Planting. But both do not regulate the use of certified seedlings yet at the time of audit stage I. Nevertheless, at the audit stage II the company had issued a Memorandum from VPA PSM2 D. Sivasanker No. 001MEMO-VPA PSM 2072013 dated 1 July 2013 on the use of certified seedlings as evidence of commitment to the established SOP and WI conform. There is Form of Oil Palm Seedling Selection FORMIIITA-BBT06-Seedling Acceptance and Planting 01 Selection. IKSMARTMCARIIITA-BBT08-PN Selection, starting from selection at 2 months old and at transplanting, counting abnormal seedlings criteria exists, and documentingrecordingreporting all reject seedlings. Figure 1. Types of Reject Seedlings. Recorded in the form of Pre Nursery Oil Palm Seedling Selection Sheet FORMIIITA-BBT08-Seleksi PN01, rev.00, rejection is classified into: RL, C, TS, CM, TS, etc. There is no data on planting plan and realization since there is no longer planting activity in all estate areas of Sungai Buaya Estate SBYE, KKPA Mesuji MSJA Estate, KKPA Gedung Aji Lama GALA Estate. At the time of audit stage I there was no SOP on planting on a peat land. However, at the time of audit stage II verification was made on Work Instruction IKSMARTMCARIIITABDT06- IK on Planting on a Peat Land Rev.00 dated 26 March 2012 for the above three 3 estate areas. Compliance status : Full Compliance 4.2 Practices maintain soil fertility at, or where possible improve soil fertility to, a level that ensures optimal and sustained yield Sop on Maintaining Unproductive Plants SOPSMARTMCARXTA-PTB Work Instruction on Plant Census IKSMARTMCARXTA-PTB01-Plant Census Work Instruction on Insertion IKSMARTMCARXTA-PTB02-Insertion Work Instruction on Measuring Plant Growth IKSMARTMCARXTA-PTB03-Measuring Plant Growth Work Instruction on Constructing And Installing Harvest Ladders IKSMARTMCARXITA-PMP04-Constructing And Installing Harvest Ladders Work Instruction on Maintaining Weeded Circle, Harvest Path, Control IKSMARTXIITA-PTM01-Maintaining weeded circle, harvest path, control path and collection path SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 27 of 82 Path and Collection Path Sop on Harvest Preparation SOPSMARTMCARIXTA-PMP Work Instruction on Developing Pollinating Weevil IKSAMRTMCARXITA-PMP01 - Developing Pollinating Weevil Work Instruction on Castration IKSAMRTMCARXITA-PMP02- Castration Work Instruction on Sanitation IKSAMRTMCARXITA-PMP03-Sanitation Work Instruction on Constructing And Installing Harvest Ladders IKSAMRTMCARXITA-PMP04-Constructing And Installing Harvest Ladders Work Instruction on Maintaining Weeded Circle, Harvest Path, Control Path and Collection Path IKSMARTMCARXIITA-PTP01-Maintaining weeded circle, harvest path, control path and collection path Sop On Maintaining Productive Plants SOPSMARTMCARXIITA-PTM Work Instruction on Tree Census IKSMARTMCARXTA-PTB01-Tree Census Work Instruction on Maintaining Weeded Circle, Harvest Path, Control Path and Collection Path IKSMARTMCARXIITA-PTP01- Maintaining Weeded Circle, Harvest Path, Control Path and Collection Path Sop on Maintaining Space Between Palm Rows SOPSMARTMCARVIIITA-PGM Sop on Weeding SOPSMARTMCARVIIITA-PGM Sop on Maintaining Roads, Drains and Bridges SOP on New Land Opening SOPSMARTMCARIVTA-PLB Sop on Pest and Disease Control SOPSMARTMCARVIITA-HPT Work Instruction on Pruning and Stacking of Fronds IKSMARTMCARXIITA-PTM02-Pruning and Stacking of Fronds Sop on Fertilizing SOPSMARTMCARIXTA-PPK Sop on Harvesting SOPSMARTMCARXIIITA-PNN Attachment to Work Instruction on Ripe Fruit Criteria in Mill LAMPXIIITA-PNN01- Ripe Fruit Criteria in MILL Work Instruction on Harvest IKSMARTMCARXIIITA-PNN01-Harvest Sop on Loading and Transporting FFB SOPSMARTMCARXIVTA-PPT Work Instruction on Loading FFB SOPSMARTMCARXIVTA-PPT01-Loading FFB Work Instruction on Transporting FFB SOPSMARTMCARXIVTA-PPT02- Transporting FFB Work Instruction on Installing Nets and Seals SOPSMARTMCARXIVTA-PPT03-Installing nets and seals There is no TBM maintenance because the youngest is the planting year 2000 - TM maintenance includes: 1 Tree census, 2 Maintenance of weeded circle, harvest path, control path, and collection path 3 Maintenance of space between palm rows 4 Weeding 5 Road and bridge maintenance 6 Pest and Disease Control SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 28 of 82 7 Pruning and Stacking of Fronds Maintenance activities are recorded in: - Foreman Activity Log BKM – daily - Work Outcome Log BHK – wholesale. - For main estate, the content of BKM and BHK is inputted into Check roll program SAP, while for Plasma, the BKM is summarized in the Report of Plant Maintenance. Compliance status: Full Compliance 4.3 Practices minimize and control erosion and degradation of soils Company has protected river border area by clearing free from oil palms with clearance space of 50 meter from river edge, and the river banks are planted with bamboo and fertifer grass to prevent erosion. The document is SOP of PT. SIP-GALASOP34 Revision 00 dated 1 March 2012. The details of rivers location and condition are described in Criteria 5.2 HCV. Compliance status: Full Compliance 4.4 Practices maintain the quality and availability of surface and groundwater. Revised ANDAL Document of AMDAL of Oil Palm Plantation and Oil Palm Processing into CPO, sources of water from Sungai Buaya and Sungai Merah. There are 3 drilled wells. The depth of drilled wells are 10-15 meter Company already has SIPA permit from the Government of Mesuji Regency, the Mining and Energy Department, No : 54006SPKTS-SIPAIII.14MSJIV2013, ± 100 m depth drilled well permit, covering Mesuji Estate and Sungai Buaya Estate, 7 April 2013 Water needs for Mill 1 ton TBS are 1.5 m 3 of water, for domestic needs are 100 m 3 day, so with mill with a capacity of 60 ton TBS per hour, the total use of river water is 2,800 m 3 day. The efficiency of water use for processing in the SBYM in 2013 from January to April is 0.712 m 3 per ton TBS. The efficiency of water use for processing in the SBYM in 2012 from January to December is 0.905 m 3 ton TBS, where the target of 1.5 m 3 per ton TBS has been achieved. Areas at Buaya River and Tapa River have been planted with bamboo to prevent erosion. The results of surface water measurement can be found in RKL and RPL that cover Sungai Buaya, Sungai Merah mill, and 4 resident wells. Organization has measured the quality of clean water in the resident wells with 4 resident well sampling points. The results of clean water quality measurement of resident well number 3 is below the BML = 50 for coliform biological factor, for pH the resident well number 1 and 4 are below the BML = 6.5 - 9 Company has measured the SBYM liquid waste, with results is appropriate with the requirements of KepMenLH No. 29 of 2003. Routine measurement is conducted every 6 months according to the activity in the RKL and RPL that conduct measurement and reporting every 6 months to BLH of Mesuji Regency, BLH of Lampung Province, and KLH Jakarta SBYM, and to BLH of Tulang Bawang Regency, BLH of Lampung Province, and KLH Jakarta. Organization conducted environmental measurement during the period of Semester I of 2013 that covers surface water and groundwater. For the SBYM area it covers Tapa River. The regulatory references are the Regulation of the Governor of South Sumatera No. 162005 SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 29 of 82 Attachment I. The measurement results do not exceed the Environmental Quality Standard requirements yet. The results will be reported to the government in accordance with RKL and RPL requirements. On 1 May 2013, the organization conducted the measurement of Tulang Bawang river upstream and Tulang Bawang river downstream in Gedung Aji Lama KKPA, executed by SMART Research. The results of river water analysis, SMARTRI-Form-PSM-27-01, revision: 00. Measurement results are in accordance with BML. On 20 May 2013 the organization conducted measurement of surface water quality in the area of MSJA and GABA, by Environmental Laboratory, Environmental Body, the Government of South Sumatera Province. This body also has obtained KAN accreditation as an environmental testing laboratory. The measuring standards are the Governor Regulation No. 162005. Compliance status: Full Compliance 4.5 Pests, diseases, weeds and invasive introduced species are effectively managed using appropriate Integrated The company has the SOP on Plant Disease and Pest Control SOPSMARTMCARVIITA- HPT, 192012 The data found for IPM program at SBYE, KKPA Mesuji and KKPA GALA: 1 rat census 2012-2013, carried out quarterly, 2 UPDKS Oil Palm Leaf Eating Caterpillar, monthly since 2009-2013. 3 Maintenance of Bio controls Plants APH, 2009 – 2013, monthly, covering: Turnera subulata, Antigonon sp. and Nephrolephis biesserata. 4 Census officer, there are 3 personnel for each division SBYE – there is caterpillar census implementation. The officer has been trained and supporting data such as photographs, attendee list, trainer from Regional Research Unit, Integrated Pest Control Training Module. 5 Sprayers, for SBYE there are 2 groups 24 personnel. For GABA there are 1 group 10 personnel. There is evidence of Training Attendee List of Restricted Pesticide Use, 18102011 for SBYE and GABA. There are 64 attendees. 6 Training for Sprayer SOP and WI, evidence such as attendee List of on 27 42013. There is SOP on Plant Disease and Pest Control SOPSMARTMCARVIITA-HPT, 192012. Compliance status: Full Compliance 4.6 Agrochemicals are used in a way that does not endanger health or the environment. There is no prophylactic use of pesticides, except in specific situations identified in national Best Practice guidelines. Where agrochemicals are used that are categorized as World Health Organization Type 1A or 1B, or are listed by the Stockholm or Rotterdam Conventions, growers are actively seeking to identify alternatives, and this is documented Handling of Pesticide Waste The registered company collected used pesticide packaging of jerry cans and plastic bottles SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 30 of 82 made of Polymex material. Non polymex material is collected in a special warehouse after being handled in accordance with WIon Washing and Cleaning of Pesticide Packaging’s and Fertilizer Bags, SIP-SBYEIK19, No. Revision: 00 approval dates 1 March 2012.Companyhas provided facilities for mixing pesticide, washing used pesticide packaging’s, washing used Fertilizer Bags, washing pesticide apron, and bathroom for sprayer personnel. SBYE, MSJA KKPA GALA KKPA At the time of audit stage I there was still waste water from sprayer bathing activities flowing into public sewer at SBYE. The organization has repaired it and directed the effluent from sprayer bathing activities into a septic tank. Pesticide hazard warning signs have been displayed in washing facilities in all areas. Used pesticide packaging’s already washed are stored in a special warehouse which also contains used paint and thinner cans and picked up by Hazardous and Toxic waste collector service company PT Primandu Jaya. The company has obtained Hazardous and Toxic waste collector and transporter permit from the Ministry of Transportation, Directorate General of Land Transportation for transporting Hazardous Materials, No. AJ.30950019DJPD201236005114. Pesticide waste handling is already regulated in pesticide work instruction, WIon Washing and Cleaning of Used Pesticide Packaging’s and Fertilizer Bags, SIP-SBYEIK19, No Revision: 00 with approval date of 1 March 2012. However, it is written in the WI that the collection place is in TPS Hazardous and Toxic, whereas in implementation not in TPS Hazardous and Toxic but in a warehouse in which there are also used paint and thinner cans. Company needs to provide hazardous waste warning signs in the warehouse. In the bathing room for sprayers after completing their tasks in MSJA, the water flows to a septic tank. In GALA, waste water from sprayer bathing room is flowing to a septic tank. Company already has a list of agricultural and forestry pesticide recommended by Pesticide Commission of the Republic of Indonesia both synthetic and natural for weeds and caterpillars such as, among others, synthetic herbicide Rolixon, Gromoxone, Roll up and natural insecticide Cordiceps for ulat api pest control. However, company should reduce the use of herbicide of paraquat active substance restricted pesticide, and use herbicides for weeds that are powerful but safe for operators in the long run observation. Compliance status: Observation no. 2 4.7 An occupational health and safety plan is documented, effectively communicated and implemented Company has established and implements occupational safety and health management system to fulfill the obligation as per government regulation. Evidence of implementation found as follows : - Has established Occupational Safety, Health and Hygiene Policy of PT. SIP – Lampung Region, dated 292011. The policy was signed by the officials of RC, PC, and PUKSPSI. The policy goal is continually seeking to reduce hazards leading to work accidents that result in injuries, work related diseases, goods damage, fire and explosion as well as production process disruption and environmental pollution. Socialization of OSH Policy is carried out in class, through training, meetings, morning calls, morning circles, as well as displayed in the SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 31 of 82 workplace. - Company has had and established OSHAS documentation that includes OSHAS Manual, SOPProcedures, Work instructions and forms that has been implemented per 1 July 2010. Currently, most of documentation has undergone revision once. The company has the Organizational structure and personnel in charge of OSH aspects, i.e. OSH Officer. In order to comply with government regulatory, the Company has established P2K3 team in each Unit, consists of General OSH Expert AK3U who serves as the Team secretary and team leader which are the Unit’s Manager. All P2K3 Teams have obtained approval from local manpower agency. The approval data are as follows: SBYM : P2K3 Team was established with SK No. 5608III.04MSJP2K3III2013 dated 22102010 by Mesuji Manpower and Transmigration Service. The Secretary is Hermawan Berliana with appointment letter No. SKP.1554DJPPKAK3-UVII2010, dated 2672010. SBYE : Division II, Blok 14 - 15 P2K3 Team is valid for 2013-2015 period, with approval of SK No. 56046HIPKII.TBP2K3IV2013 dated 1542013, from Social, Manpower and Transmigration Service of Tulang Bawang Regency. The Secretary is Piki Ardiansyah, as AK3U, with appointment letter No. KEP.4120MDJPPKI213 dates. 712013. PPE has been equipped by the company such as: boat, helmet, glass for all harvesters. GALA KKPA : P2K3 Team has obtained approval from Social, Manpower and Transmigration Service of Tulang Bawang Regency with No. Kep:56036HIPKII.TBP2K3IV2013 with Secretary Ifriansyah as General OSHExpert. MSJA KKPA : P2K3 Team has obtained approval from Social, Manpower and Transmigration Service of Tulang Bawang Regency with No. Kep:56045III.04MSJP2K362013 dated 10 June 2013 with Secretary Hendri Kustiwan. Appointment Letter No. Kep: 2266MDJPPKX2011 dated 6 October 2011. P2K3 Team has been conducting routine monthly meetings, on a regular basis. Minutes of meeting are already listing the topics, description of meetingdiscussion results, due date of settlement follow up start, finish, and PIC. The completion status of each case complete with completion date, and if not yet completed then sit will be brought to the next meeting. All work units under PT. Sumber Indah Perkasa has included its employees in the Social Security Program Jamsostek, starting from daily wage workers BHL, PKWT, and SKU. The program varies in package according to the employee status. Those with BHL status will be included after 3 consecutive months because their status rises to Daily-SKU SKU-H. Employees with SKU-H and PKWT status are only included for ½ packages, i.e. only JKK and JKM, where as employees with Monthly-SKU SKU-B and SKU status up to staff get full SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 32 of 82 package programs, namely: JKK, JKM, JHT, and JPK. List of Jamsostek membership is stored and recorded on manpower data base, and already has KPJ Number. But PKWT in particular, does not have KPJ number. The Jamsostek Insurance is not willing to give KPJ Number for reasons of non-permanent status. The company has conducted worker health examination of BHL, PKWT, and SKU. Evidence of examination can be shown as follows: 1 There is a recapitulation of staff and employee health examination results in 2013: a. SMRM, examination date: in stages from the 2 nd to 5 th month of 2013, for 168 workers SKU+PKWT. b. SBYM, examination date: in stages from 2 nd to 4 th month of 2013, for 88 workers. Those not yet examined are planned to be examined in July, 2013. c. SMRE, examination date: in stages from 2 nd to 4 th month of 2013. And d SMRE, examination date: in stages from 2 nd to 4 th month of 2013. Company has issued a Policy for medical examination, on Lampung Region Worker Health Examination, approved by the Regional Controller and Production Controller, dated 162011, containing prior-employment, periodic, and specific examination. During preliminary audit, the examination of cholinesterase aspect has not been conducted for workers who work closely with Hazardous and Toxic, such as: sprayers, Hazardous and Toxic waste officers, chemical warehouse and laboratory officers. Application for this examination has just submitted. Also for personnel working in the noisy area, the audiometry measurement has not been conducted. At the time of the audit stage 2, company has been conducting cholinesterase and audiometry examination for these personnel. Spirometry examination should also be programmed for sprayers, Hazardous and Toxic waste, chemical warehouse and laboratory personnel. The company also provides health care service by establishing a Clinic located in the SBYE Central Office. The clinic had received permit from the Department of Health of Tulang Bawang with Private Health Care Service License No. 455503014SIT-BPDK-TBIII2004, dated 1932004 and valid until 0142007. License reapplication is currently under process in connection with the regency expansion so that the status of the clinic becomes under the Mesuji Regency. The clinic is led by a company doctor and a paramedic, both are medical certified. Employees have medication in the clinic free of charge, for both PKWT and BHL status. The service also covers the employee’s family. There is a Procedure for Hazard Identification, Risk Assessment and Risk Control HIRARC No. SOP17SMARTLH-02, Rev. 01. Company has conducted ISBPPR that covers the whole Estate and Mill. The IBPPR results are recorded in Risk Analysis Form FP 1117-SOP-02 and Risk Analysis Follow up Form FP 1117-SOP-02. The reference for preparation is the ASNZ method. Preparation of ISBPPR for Estates covers from maintenance fertilizer, spraying, space between palm rows, OPT, roads, harvesting, emplacement maintenance, warehouse, workshop all machinery, clinic, central office, washing place for keep and Fertilizer Bags shower sprayers. As for Mills, it has covered the entire process from transport, security, weighbridge, TBS grading, loading ramp, transfer carriage, sterilizer, tippler, thresher, press, clarifier, boilers, kernel, engineering, effluent, workshop, warehouse, Hazardous and Toxic warehouse, diesel fuel tank, lab, office, CPO dispatch, machine unit installation, fire engines, and vehicle traffic. ISBPPR is reviewed annually to see the effectiveness of earlier risk control application. If deemed necessary, the additional control will be added until low L risk level is achieved. This activity is carried out together between the operating officials and the P2K3 Secretary and Chairman. In each Unit company has conducted a number of training related to safety and health OSH SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 33 of 82 aspects, some of which can be reported as follows: SBYE, MSJA and GALA Units: - First aid Training, 2152013, by dr. Wiyangga, from the clinic. 6 participants 4 foreman and 2 assistant clerks, materials include simulations on how to deal with accidents. - Socialization of ISCC, ISPO, RSPO, OSH, P3K, APD, MSDS, on29052013. There were 13 participants. The presenter was OSH officer. - Socialization of procedure for handling natural disaster and fire KTD, on 16032013. Participants were 7 security personnel. - First aid Training, combined participants of Regional level, totaling 75 participants, on 10102011. - General OSH Expert for P2K3 secretary. - Restricted pesticide use training, on 1810.2011, participants from SMRE with a total of 67 participants, on 19102011. There was “Restricted Pesticide User Certification” from the Department of Agriculture, Food Crops and Horticulture of Lampung Province. - Special skill training, including: welder and heavy equipment operator license. SBYM Unit : - First aid Training, 2152013, 11 participants 4 foremen, 1 security personnel, book keeper, 2 analysts, nurses, P2K3 secretary, cashier. - Socialization of MSDS on 1452013 at SBYM to48 workers by OSH officer. - Special skill training, including: welder and heavy equipment operator license. Company has developed and established SOP related to fire prevention and mitigation, i.e.: - SOP on Emergency Handling SOPSMK3SMARTLH-09, applicable in Estates and Mills. - Technical guidelines for dealing with emergency situation in the form of Emergency Response Mechanism Diagram contained in form of FP 02SMK3-SOP-10, according to conditions, i.e. : 1 Fire 2 Hazardous and Toxic Spill Handling 3 Earthquake 4 Chemical Poisoning through Ingestion. These SOPs have been effective since 1 July 2010.Socialization has been carried out to all workers by means of displaying at strategic locations, such as: Estate office, division office, Mill office, workshop, and parking area in the form of banners or billboards. Company has established Emergency Response Team by appointing its personnel. The capacity to prevent and mitigate fire is sought to by providing the following training : - SBYM Unit, some of the Dry Powder Squad members have attended training in the use of portable extinguishers Light Fire Extinguisher, dated 20112010, but, only 2 out of the 7 squad members, i.e. Sudarso and Sugiarto. - GALA Unit, Light Fire Extinguisher training has been conducted as seen in the List of Attendees of Light Fire Extinguisher Training, dated 762013. But, out of the Light Fire Extinguisher Team members, there is one not yet attending the training i.e. Sulisiyanto. - SBYE Unit, some of the Light Fire Extinguisher Team members have attended Light Fire Extinguisher training on 29052013 and 20112011 in Division 1 office. But out of that number of Light Fire Extinguisher Team the TTDERP Structure has not received training. - MSJA Unit, Light Fire Extinguisher training has been delivered on 20 June 2013, which is attended by all Light Fire Extinguisher Team members. SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 34 of 82 Company has provided fire controlmitigation facilities and infrastructures as follows: - SBYM Unit In the Checklist of KTD Equipment dated 3 June 2013, it is recorded : 1. 35 Light Fire Extinguishers in 35 locations; 2. 4 units of pillar hydrant and 4 boxes of corresponding equipment hoses and nozzles at 4 strategic locations at St. Sterilizer, St. Boiler, St. Kernel, and St. Clarification; 3. Sandbag along with spades at 4 locations; and 4 Eye washers and showers in 5 locations lab, CaCO3 warehouse, LB-3, oil warehouse and WTP. Company also has developed Evacuation Map and Map of Fire Sensitive Area provided with location points of Light Fire Extinguisher, hydrant, eye washershower, direction arrow of evacuation route, and 2 assembly points. It is suggested the company completed the information on important telephone numbers to be contacted in the case of emergency. - SBYE, MSJA and GALA Units In the Summary Report of Light Fire Extinguisher checking dated 28 May 2013, it was found : 1. 41 Light Fire Extinguishers distributed in 41 locations in the entire estate area covering central office, fertilizer warehouse, diesel fuel warehouse, oil, spare part, LB3, division office, mess, staff housing. 2. 1 unit of water tanks, 1 portable water pump provided with hoses and nozzlesguns. Company has conducted routine inspection of Light Fire Extinguisher and hydrant and recorded the results using PMKS Patiware Light Fire Extinguisher and Hydrant Monitoring form, which that is carried out monthly. There is evidence of implementation for December 2012 and January 2013. This activity is carried out by workshop foreman, verified by assistance workshop and acknowledged by Mill Manager. In dealing with emergency situation, company has established Emergency Response and Preparedness ERP as follows: - Emergency Response and Preparedness Organizational Structure has been established for each Unit, covering SBYM, SBYE, Mesuji and GALA. The KTD structure was developed by P2K3Secretary and approved by P2K3 Chairman Unit Manager. The structure is composed of Team Leader, Deputy Team Leader, General Assistant, Executive Chairman, Secretary, Fire Extinguishing Team Dry Powder, Hydrant, Sand, Wet burlap, Hook, Evacuation Team, Security Team, Connecting team, Eliminating Team, and Health Team. For SBYM mill area, company should have fire mitigation officers in accordance with the provisions of the Decree of the Minister of Manpower No. 186MEN1999. Based on Annex 1 and 3, a processing plant Mill is classified as vegetable oil mill with Moderate Fire Potential III. A factory with a total workforce of over 100 people should have fire mitigation officers: 1 for class A, 1 for class B, 5 for class C, and 12 for class D. At the time of the audit stage 2, the Company had carried out Fire Simulation Training, dated 05072013 from the Department of Social, Manpower and Transmigration, Tulang Bawang, to 20 people. However, this is only a fulfillment for class D. Company is strongly encouraged to comply with these provisions and required to program it in subsequent years. Company has conducted various efforts related to fire prevention and mitigation, and kept the recorded report properly. Activities carried out in various unit areas Estates and Mills are as follows: SBYM Unit: - Fire simulation was conducted on 562013. - Routine inspection of emergency response equipment such as: Light Fire Extinguisher, SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 35 of 82 hydrant, and sand burlap from every two week to once a month. This activity is conducted by TTD members, or SPO Officer, or P2K3 secretary. SBYE, MSJA and GALA Units: - Wildfire simulation was conducted on 2432012 and in mid July 2013, regional level participant unit, 68 participants. There is scenario, evaluation, photos, and attendee list. - In GALA, simulation was conducted for potential earthquake and fire emergency situation, dated 2562013, in the location of Central Housing, complete with scenario and evaluation but simulation for chemical spill mitigation is not yet conducted. - Patrol activity is conducted by Security Team to monitor HCV and wildfire, recorded in the Patrol Book per 2 weeks. - Creating fire breaks in the area bordering the community plantations and or being fire potentials, in each division – Unit. - Develop Division’s Fire Vulnerable Area Map. - Provide list of phone number both internal and external including for local police, local military, hospital, fire brigade. - Routine inspection of emergency response equipment, such as: Light Fire Extinguisher, hydrant, and sand bag from 2 weekly to monthly. This activity is conducted by ERP members, or SPO Officer, or P2K3 Secretary. - Report fire prevention to the Department of Social, Manpower and Transmigration every 3 months, Company has provided equipment related to OSH aspect, including PPEfor the workers. Below are some data that can be reported through sampling: - SMRM Unit, there is certificate of acceptance for: 1 leather gloves 2 safety shoes-workshop for 25 people, on 922013, 3. Helmet on 1512013, 5 people, 4 Boots on 42013, for 4 people, - SMRE and GABA Units, there is a list of name of PPE recipient in Div.4, certificate of acceptance dated 2452013, of AP Boots 7 people, sprayers: rubber gloves, AP boots, mask 12 people, harvesters: AP boots, helmet, safety glasses, sickle covers 27 people. Company has an effort to fulfill with P3K provisions. Work sites have been provided with first aid kits, though some of them are not complete in accordance with the regulatory requirements. In the field, every foreman such as harvest and sprayer foreman carry small first aid kits containing the required medicine. All foremen have received first aid training from company doctor. Also, in each Unit both Estate and Mill, a number of first aid officers have been appointed based on the Letter of Decision on Appointment of First Aid Officer signed by P2K3 Chairman or Unit Manager. Company has established SOP on Handling of Work Accident SOPSMK3SMARTLH-10, 172010, starting from handling accident in a worksite, handling of mass accident, reporting, investigation and recovery. There are evidence of implementation of reporting and investigation for accident occurred, among others: 1. Work Accident Report 124 hours FP 01SMK3-SOP-10. For example, for SBYE, accident date is 29052013, Paryanto NIK 09018, reported on 3052013. 2. Accident Investigation Report from the Assistant FP 02SMK3-SOP-10. Other records related to accident recording are: 1 Recapitulation of Accident Report Every Month FP 03SMK3-SOP-10, and 4. Recapitulation of SR and FR Counting FP 04SMK3- SOP-10. SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 36 of 82 On Saturday 11 May 2013, an accident occurred to a plane of Fletcher type conducting air manuring on oil palms. According to the explanation of Mr. Humala Sinaga Lampung Regional Controller, the results of investigation of accident of plane coming from Air Manuring Division could not be obtained because of PT. Sumber Indah Perkasa SIP is just as a lessee who provides fertilizer and aircraft runway. Investigation is immediately undertaken by the National Commission for Transportation Safety KNKT on Sunday 12 May 2013 or a day after the incident with a note that parties who want the result of the investigation are asked to contact KNKTdirectly. Compliance status: Observation no. 3, 4, 8

4.8 All staff, workers, smallholders and contractors are appropriately trained.

Company has established annual training programs. Training activities are based on SOP on HR Development Training SOPSPOSMARTLH-10, 172010, rev.01, covering: preparation, implementation, and evaluation. There is Training Need Analysis set by Regional Training Center Coordinator RTCC and the results are in the form of Training Need Identification Matrix FLEstateTRAD10, prepared by SPO Officer, and approved by Estate Manager. The Matrixes developed by SBYM, GALA, and MSJA units. Annual training program is prepared and established by respective Unit. For 2013, it is: - SBYM and SBYE: P2K3 Training Program of PT Sumber Indah Perkasain 2013, prepared and established by P2K3 Secretary, and P2K3 Chairman. Also, there is P2K3 Training Program for Sustainability areas covering: OSH, Environment, social, HCV, greenhouse gas emission, sexual harassment, and PHT. - GALA and MSJA: Training Program 2013, signed by person in charge of SPO Unit and approved by Unit Head as per 05012013. Training materials include: P3K, proper, socializationtraining of ISCC, ISPO-RSPO, PHT, harvesting, HCV, Kompes, procedures WI, PPE, Hazardous and Toxic waste control, GHG mitigation, GHG emission calculation, prevention of sexual harassment, socialization of communication and consultation, socialization of SOP on contractor control, socialization of jamsostek to contractors. All records showing evidence of training implementation, such as: attendee list and photographs, and certificate are kept by KTU, while training records for sustainability are also kept by SPO Officer. Each Unit records training realization. For example, in GALA as well as MSJA Units. It is recorded in Training Recapitulation form that includes information: name of training, instructor, participant, implementation time, and training location. Company is deal with trained contractor personnel. As mentioned in the above training program, each contractor of SBYM Mill, SBYE Estate, as well as GALA and MSJA Unit has been provided with related to RSPO, which includes : - Socialization on appeal to include their workers in jamsostek, to care with environmental sustainability, protect biodiversity, implement OSH in the form of PPE use, encouragement to comply with OSH regulations, and being in harmony with the community. - Socialization on wage system and worker’s age that must not be 18 years old and minimum wage regulations. - Socialization on PPE: PPE mandatory, PPE benefit, encouragement to always follow OSH regulations—especially drivers and loading personnel. - For TBS transport contractors, evidence of being trained is demonstrated by driving license possession. SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 37 of 82 - Some contractors for road maintenance and housing have been selected in a strict manner through pre-bidding process from the aspect of willingness to comply with OSH aspect, employment aspect, as well as technical aspect according to type of work to be done. In GALA, two SPKs are found not expresivvely specifying the provisions of PPE mandatory use. They are SPK no. 027GALAJKTO042013-Box Culvert and SPK no. KUD-KSGALASPKL- LJanuary-12-010-FFB Transportation and Loading. Compliance status: Observation no. 9 5 ENVIRONMENTAL RESPONSIBILITY AND CONSERVATION OF NATURAL RESOURCES AND BIODIVERSITY

5.1 Aspects of estate and mill management, including replanting, that have

environmental impacts are identified, and plans to mitigate the negative impacts and promote the positive ones are made, implemented and monitored, to demonstrate Company conducted impact analysis in the Revised ANDAL document of AMDAL of Oil Palm Plantation and Oil Palm Processing into of CPO PT Sumber Indah Perkasa with an land area of 9,254 Ha and MILL with the capacity of 60 ton FFBHour No. Document is 16KOMDAL11.04IV2008 dated 14 April 2008. In ANDAL document the scope of environmental impact analysis is oil palm plantation activity and processing into crude palm oil CPO. The scope of environmental impact analysis is Sungai Buaya Estate, Sungai Merah Mill and Estate, Geng Aji Baru Plasma, Gedung Aji Lama Plasma, Mesuji Estate, Sungai Buaya Mill, and Sungai Merah Mill. In ANDAL document, the environmental impact analysis is still scoping company current activity and condition. Environmental impact management is contained in RKL and monitoring plan is contained in RPL. The RKL and RPL is implemented every 6 months and report every 6 months to BLH of Mesuji Regency SBYE, GABA, MSJE, SBYM, Tulang Bawang Regency SMRM, SMRE, GALA, GABA ANDAL Document also covers land biodiversity in the form of flora and fauna biological aspect, social cultural aspect to the population of villages around unit and division. Compliance status: Full Compliance 5.2 The status of rare, threatened or endangered species and high conservation value habitats, if any, that exist in the estate or that could be affected by estate or mill management, shall be identified and their conservation taken into account in management plans and operations Company has had SOP on Identification and Management of HCV No.: SOPNPSMARTIVLH 001 No. Revision 01 effective date 1 July 2010. Company has had the revised ANDAL document of AMDAL of Oil Palm Plantation and Oil Palm Processing into CPO of PT Sumber Indah Perkasa with a total area of 9,254 Ha and Mill with a capacity of 60 ton FFBhour that scopes environmental conditions related to flora and fauna. Information in ANDAL document prior to planting, the flora identified is commercial crops such as meranti wood and there is no identification of fauna prior to planting. In ANDAL document there is flora and fauna identification after the land becomes oil palm plantation and oil palm mill, for flora it is palms and bushes, for fauna it is buaya, ular sendok, tikus, landak, babi hutan, macan SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 38 of 82 akar, etc. The land’s baseline condition is a secondary forest. There is no information in ANDAL document about flora and fauna condition when it was still a secondary forest. Company has performed identification of areas with high conservation value along with a team that has obtained approval from RSPO Board and the report of identification of high conservation value area has been peer reviewed by Resin Sözer, an independent body approved to do peer review of high conservation value HCV area. Company has the Final Report of Identification and Analysis of the Existence of High Conservation Value Area HCV of each unit. At the stage I and stage II, the Final Report of Identification and Analysis of the Existence of High Conservation Value Area HCV of Sungai Buaya Estate, KKPA Gedung Aji Lama GALA Estate and KKPA Mesuji MSJA Estate is shown. In Sungai Buaya Estate it covers the border area of Sungai Buaya, the border area of Sungai Tapak, Lake Dasiem, reptile fauna, mammals, Aves, and so on. Protection of river border is to clear it from oil palms with a clearance space of 50 meter from the river edge, and the river banks are planted with bamboo and vertiver grass to prevent erosion. For fauna protection, company places communication boards of hunting prohibition in several areas where fauna occurrence is identified though through footprints macan akar and babi hutan. HCV identification was conducted in the oil palm plantation area of SBYE unit 4°5’ - 4°17’ S and 105°26’ - 105°39’ E.The working area of PT. Sumber Indah Perkasa is 5,058.82 Ha with planting years of 1991, 1992,1993 and 2000. GALA Unit has the area of 5,005.25 Ha with planting years of 1995, 1996, 1997 and 1998. MSJA Unit has the area of 5,209.63 Ha with planting years of 1995, 1996, 1997 and 1999. Data of flora and fauna prior to planting are contained in Initial Environmental Examination of PIL Document of Oil Palm Plantation Project of PT. Sumber Indah Perkasa, Mesuji District and Menggala District, North Lampung Regency which is prepared by PT. Mulia Consultants. Data of flora diversity consists of: Cover Crops Base Vegetation, among others: - Alang – alang Imperata cylindrical - Rumput Bendera Eleucine indica - Putri Malu Mimosa invisia - Pakis Alsophila sp - Rumput Merdeka Paspalum sp Trees, among others: • Pala Hutan Myristica sp • Beringin Hutan Ficus benyamina • Karet Hevea brasiensis • Bambu Bambusa sp • Pule Gudrania sp Aquatic Flora around the project location of PT. Sumber Indah Perkasa, among others: • Ganggang Hijau Chlorophyta • Enceng Gondok Eichornia grassipes • Palam Corypha sp • Teratai Putih Nelumbium sp • Pakis Air Ceratopteris sp • Lumut Bryophyta Data of terrestrial fauna diversity in the project location of PT. Sumber Indah Perkasa prior to planting includes: Aves SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 39 of 82 • Manyar Ploceus manyar • Tekukur Streptopelia sp • Jalak Strurnus contra • Emprit Lanchura sp • Cucak Rowo Pycmonotus sp • Elang Bustantur sp Mammals • Gajah Elephan sp • Kijang Cervis timorensis • Babi Sus vitatus • Beruang Urus sp Reptilia • Ular Piton Phyton sp • Kadal Mobvia multifaciata • Ular Sawah Phyton molurus Insect • Kupu-kupu Papilio sp • Capung Gomphus sp • Kumbang Aryetes sp In the Gedung Aji Lama GALA KKPA there is HCV 6, i.e. old cemetery such as Bangunrejo old cemetery, Rejomulyo public cemetery, and also HCV 1.2 of protected animal species. In the Mesuji MSJA KKPA there is HCV 6, i.e. old cemetery such as old cemetery Block B11, and also HCV 1.1, 1.3, 4.1 of Lake Dasiem, but there are still oil palm stands less than the clearance space of 50 meter from river banks, because the KKPA Mesuji MSJA Estate is the community plasma but Agrochemical use is restricted to 50 meter from the lake Dasiem shoreline. The following is details of Identification and Analysis of the Existence of High Conservation Value Area HCV of Sungai Buaya Estate, Gedung Aji Lama KKPA and Mesuji KKPA: HCV Type Field Identification Result DivisionBlock Location of Findings Area Ha Sungai Buaya Estate 1.1 ; 4.1 There is area of river border or riparian ecosystem of Sungai Buaya and Sungai Tapak which functions to support local protected areas, water sources and flood control. Sungai Tapak river border 47.30 1.2 There are protected animal species: 1. Elang Hitam Ictinaetus malayensis 2. Cangak Abu Ardea sumatrana 3. Cangak Merah Ardea purpurea 4. Suku Alcedinidae Raja Udang Biru, Cekakak Belukar, Cekakak Sungai and Pekakak Emas Sungai Buaya river border and inside the plantation - Mesuji KKPA 1.1 ; 1.3 ; 4.1 There is area of river border or riparian ecosystem of Sungai Buaya and Sungai Tapak which functions to support local protected areas. Lake Dasiem 5.42 1.2 Endangeredprotected species in the list of Government Regulation No. 71999 Protected and Mesuji MSJA KKPAEstate and - SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 40 of 82 IUCN LC ver 3 2010, include : 1. Raja Udang Biru Alcedo coerulescens 2. Cekakak Belukar Halycon smyrnensis 3. Blekok Sawah Ardeola speciosa 4. Kuntul Kerbau Bubulcus ibis 5. Raja Udang Alcedo meninting 6. Cangak Laut Ardea purpurea 7. Cangak Merah Ardea sumatrana 8. Elang Tikus Elanus caeruleus 9. Cekakak Sungai Todirhamphus chloris 10. Macan Akar Felis bengalensis surrounding areas 6 There is old cemetery Old Cemetery Blok B-11 - Gedung Aji Lama KKPA 1.2 Endangeredprotected species in the list of Government Regulation No. 71999 Protected and IUCN LC ver 3 2010, include: 1. Raja Udang Biru Alcedo coerulescens 2. Cekakak Belukar Halycon smyrnensis 3. Blekok Sawah Ardeola speciosa 4. Kuntul Kerbau Bubulcus ibis 5. Raja Udang Alcedo meninting 6. Cangak Laut Ardea purpurea 7. Cangak Merah Ardea sumatrana 8. Elang Tikus Elanus caeruleus 9. Pekakak Emas Pelargopsis capensis 10.Cekakak Sungai Todirhamphus chloris 11.Macan Akar Felis bengalensis 12.Tupai Tanah Lariscus insignis 13.Buaya Muara Crocodylus porosus 14.Biawak Varanus sp Gedung Aji Lama GALA KKPA Estate and surrounding areas - 6 There are cemeteries: 1. Bangunrejo Old Cemetery 2. Rejomulyo Public Cemetery 3. Karyamakmur Public Cemetery 4. Pasar Batang Public Cemetery 5. Bangunrejo Public Cemetery 6. Panca Tunggal Jaya Public Cemetery 7. Infant Cemetery GALA unit area: - Block A-19 - BlockB-26 - BlockC-41 - BlockC-06 - BlockD-12 - BlockA-29 - BlockA-59 - HCV monitoring is conducted every 2 weeks. Document used is Patrol Log Book which is summarized into HCV Monitoring Form No. Document FSMARTLH00309 every 6 months. In addition, there are documents: • Erosion Control Crop Planting Report • HCV Area Patrol Report • Boundary Peg Maintenance Report • Water Level Report • Socialization Invitation • HCV Socialization Report SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 41 of 82 HCV Monitoring Form has specified recommendations for improvement as well as recommendations based on routine monitoring carried out every 2 weeks, but Person in Charge PIC and a due date for the completion of recommendation should be determined to see the progress of follow up to HCV monitoring results. Compliance status: Observation no. 6 7 5.3 Waste is reduced, recycled, re-used and disposed of in an environmentally and socially responsible manner Company performs impact analysis in the revised ANDAL document of AMDAL of Oil Palm Plantation and Oil Palm Processing into CPO of PT Sumber Indah Perkasa with a total area of 9,254 Ha and 2 Mills with a capacity of 60 ton FFBHour. SOP of Waste Management, SOPSPOSMARTLH-09, revision: 00 approval date: 1 July 2010, covering mill waste: solid, liquid, gas including LB3. Plantation : ex pesticide packaging’s, land application, ex agrochemicals such as fertilizer bags Current practice of waste flow rate measurement is only on waste that flows out directly from the mill to Land Application recorded using flow meter every 7o’clock in the morning and at the time when pumping is finished. Company has Extension Decree of Permit to Utilize Oil Palm Industrial Effluent on Soil with the Decree of the Regent of Mesuji No.: B161I.02HKMSJ2011, dated 29 July 2011 with validity period of 3 years. Effluent managed in the waste water treatment installation is directed to the land for land application Company performs ambient air and emission quality measurements mobile and non-mobile sources. None of the measurement results exceeds the BML. Company reports the measurement results every 6 months to BLH of Mesuji Regency SBYM, BLH of Lampung Province, and Jakarta KLH, with evidence of their receipt. Liquid and Hazardous and Toxic Substance waste results are reported every 3 months. In SBYM the Company has 4 effluent ponds. SBYM internal daily measurement covers the parameters of pH, Alkalinity, and VFA. Compliance status: Full Compliance 5.4 Efficiency of energy use and use of renewable energy is maximized Company has performed identification of GHG emission sources of estate and mill activities. Company has calculated GHG emission of the SBYM, which includes calculation of respective GHG of estates supplying the fruit. Diesel fuel efficiency at SBYM in 2010 was 27.46, 2011 was 44.32, and 2012 was 33.94, so that on average the efficiency was 35.92. Diesel fuel use in 2010 was 1.88 literton CPO, in 2011 was 1.51 literton CPO, in 2012 was 1.12 literton CPO. SBYM use of palm shell and fiber as fuel substitutes in 2012 was 10,916,000 kg and 37,891,121 kg, respectively, with the total energy used ton CPO of 1,288,881 KKAL. GALA used diesel fuels in 2010 = 0.00068 LtrTon FFBwith a total of 113,292,860 Ton FFB and 76,982 Liter of Diesel fuels. 2011 = 0.00073 LtrTon FFB with a total of 134,171,830 Ton FFB and 97,589 Liter of Diesel fuels. SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 42 of 82 2012 = 0.00074 LtrTon FFB with a total of 135,833,910 Ton FFB and 99,839 Liter Solar. 2013 until June = 0.00114 LtrTon FFB with a total of 35,473,620 Ton FFB and 40,272 Liter of Diesel Fuels Company has SOP on Calculation of Green House Gas Emission at SBYM of PT-SBYMSOP02 The use of empty fruit bunches at SMRE in January – April 2013 was 21,763 ton with total application land area of 382.89 hectares. Target area to be applied with empty bunches for 2 years is 668 hectares. In 2012 it is 63,634 ton of empty bunches 1,155.74 hectares of land, with target of 672 hectares and 49,915 ton of empty bunches. Company has SOP on GHG Emission Mitigation of PT SIP – SBYMSOP22 No. Revision: 00, date approved: 02 January 2013, and performs calculations of GHG emission reduction from diesel fuel efficiency, shell efficiency in the processmill where in 2012 the total GHG reduction from processing was 186.73 kg CO2ton CPO. Compared with 2011 there is a rise due to the effect of low crop and huge crop during harvest. There is no peat land at SBYE Estate, so that peat land management is not required. The Estate GHG calculation is as follows: SBYE = 74.75 kgCO2eqTon FFB; MSJA = 95.19 KgCO2eqTon FFB; GALA = 81.77KgCO2eqTon FFB. SOP of GHG emission mitigation for PT SIP – SBYESOP35 SBYE, PT SIP – MSJASOP35 MSJA, and PT SIP – GALASOP35. Compliance status: Full Compliance 5.5 Use of fire for waste disposal and for preparing land for replanting is avoided except in specific situations, as identified in the ASEAN guidelines or other regional best practice. Company does not burn wastes and there are no replanting activities. Company already bans the use of fire for replanting. Also, Company has instructed its workers and encouraged local people not to burn domestic garbage. Compliance status: Full Compliance 5.6 Plans to reduce pollution and emissions, including greenhouse gases, are developed, implemented, and monitored. Management through RKL and RPL implementation. Organization has RKL and RPL covering environmental impacts on river and drilled well water quality, ambient air, noise, air quality. RKL and RPL are reported to the BLH of Tulang Bawang and Mesuji Regency every 6 months starting from 2012, and there are receipts of RKP and RPL document submission. SOP of Waste Management, SOPSPOSMARTLH-09, revision: 00 date approved: 1 July 2010, covering mill wastes: solid, liquid, gas. SOPWI is not yet available to handle stationary sources nuisance, such as noise that exceeds the BML At the stage 1 the results of measurement of vibration, odor, and noise did not come out due to the environmental testing laboratory’s equipment problems. Organization has followed up by SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 43 of 82 performing measurement on 20 May 2013 by the Government of South Sumatera Province, Environmental Body, UPTB Environmental Laboratory, covering odor at effluent ponds, noise at the gensets and boilers, also emission at the gensets and boilers. The measurement results are not departing from the requirements of the Regulation of the Minister of Environment No. 212008 for Genset emission and No. 072007 for Boiler emission. Organization controls vibration, odor, and noise nuisance through job work instruction for nuisance in the Mill, such as noise disturbance, the work instruction of the genset job has incorporated controls using silencer in the genset room and use of ear protection devices ear plug and ear muff. Relating to environment outside the perimeter of mill and in employeepopulation residential area there is description on control in the RKL and RPL Report every six months, such as control using trees to repress odor, noise, and dust. The result of 20 May 2013 measurement does not depart from the BML requirements 50 dBA at residential area, 70 dBA at mill surrounding environment. Organization needs to establish SOPwork instruction to deal with stationary sources impacting beyond the mill the location of stationary source disturbance is in the Mills. In the Estates, only GALA has gensets as stationary source nuisance which is potentially not yet meeting the BML requirements of the applicable regulations. Compliance status: Full Compliance 6 RESPONSIBLE CONSIDERATION OF EMPLOYEES AND OF INDIVIDUALS AND COMMUNITIES AFFECTED BY GROWERS AND MILLS

6.1 Aspects of estate and mill management that have social impacts are identified

in a participatory way, and plans to mitigate the negative impacts and promote the positive ones are made, implemented and monitored, to demonstrate continuous improvement Company has conducted Social Impact Assessment internally in 2012. Based on the results of SIA it is identified that there are 14 villages around PT SIP affected by the social impact of estate and mill operations. SIA report says that the area of main estate is 9102.2 Ha and plasma estate is less than 15,000 Ha with total KUD member of 17,254 KK Company has had the list of stakeholders of all units. Based on the results of SIA and input from the units, company has established a strategic plan for CSR Program of 2014-2018: period 5 years. The program has included the short-term and long-term plans covering the aspects of education, health, infrastructure, sport, religion, arts, culture and micro business. The existing program does not include specific efforts made by company to preserve the native culture of indigenous people living around the company environment. Based on the SIA report, Company has conducted road improvement activities in 2009-2011 for 21 villages around the company site. Educational assistance is given to areas in the location of main estate and plasma estates. Religious assistance given in 2010 period already represents Islam and Christian religions and in 2013 it is for Hindu in the form of pura Talang Batu Village construction. Based on the SIA report there is negative perception because of jealousy felt by villages from not receiving social assistance Batu Ampar Village and Tri Rejomulyo Village. Company responded by launching Cheap Oil Market Operation in 2012 in Batu Ampar Village and SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 44 of 82 educational assistance in the form of building materials for the development of local primary school in SDN 01 Tri Rejomulya in 2013. Compliance status: Full Compliance 6.2 There are open and transparent methods for communication and consultation between growers andor mills, local communities and other affected or interested parties Company has had SOP on Responding to Request and Information SOPSPOSMARTLH-01. List of information is already available to be accessed by relevant stakeholders. Request for information outside the list will require the consideration and approval from the Top management. List of stakeholders of each unit is already available consisting of customarycommunity leaders, Muspida and village chief, company trade union, Contractors and suppliers. Any incoming requests for information is recorded in KTU and passed to relevant Manager. All requests for information are recorded in information book. Each unit maintains information request and response book. Routine requests are recorded in a routine information granting book and non-routine information requests are recorded in a separate book. In addition, Sinar Mas Group has SOP on Communication and Consultation SMARTXIVMCAR003 where any information requests will be responded the longest in 5 weeks 1 month. Sampling an information request dated 19 May 2012 related to complaints on the issues of road and village head incentive. The letter in question as well as the response to the complaining party Bp Ikhwanudin from Sumber Jaya Village has been maintained. Compliance status: Full Compliance 6.3 There is a mutually agreed and documented system for dealing with complaints and grievances, which is implemented and accepted by all parties Company has SOP on Complaint and grievances SOPNPSMARTXIIMCAR001. Any complaint will be recorded in the log book of complaint and grievances. The source of complaints may be internally, externally and female workers. Sampling was conducted on employee’s complaint on 10 December 2012 concerning poor quality of rice. Company passed the complaint to KUD as the supplier of the rice. The response from KUD dated 20 December 2012 states that they will supply better quality rice. The officer informed that the employee has received better rice so that the complaint is closed. Compliance status: Full Compliance 6.4 Any negotiations concerning compensation for loss of legal or customary rights are dealt with through a documented system that enables indigenous peoples, local communities and other stake holders to express their views through their own representative institutions There is SOP on Land Conflict Settlement SOPSPOSMRTLH-04. So far the company and KUD give information that there is no dispute in the period from 2010 until now in the company’s surrounding areas. The SOP says to give first priority to deliberation for consensus over legal action. Sampling conducted on the Mesuji stakeholders Religious Leaders and District Chief ensure that no conflict exists in the area of Sungai Buaya Mill. Compliance status: Full Compliance SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 45 of 82

6.5 Pay and conditions for employees and for employees of contractors always

meet at least legal or industry minimum standards and are sufficient to provide decent living wages Company maintains SKU Detailed Payroll sample, May 2013, for SKU-H, SKU-B, as well as PKWT, while for BHL and BHB such list is contained in BHL Detailed Payroll sample, May 2013. For BHL the salary is paid twice per month, from 26 th to 10 th day of subsequent month, and from 11 th to 25 th of ongoing month, so the payroll is made twice. Company has company rules in the form: 1. Collective Labor Agreement between PT. SIP of Tulang Bawang Regency, Lampung: BH.NO: 182PT.SIP1989 and PUK.SPPP-SPSI Trade Union of Tulang Bawang, with Registration No.: 063KPTSPCSPPP.SPSITBXII2005, for period of 2011-2013, and 2. Company Regulations of PT. SMART Tbk, version 2013-2014. For 2013 payment system, company refers to the Decree of the Governor of Lampung No G30III.05HK2013 concerning Stipulation on Tulang Bawang Regency Minimum Wage UMK in 2013 of Rp. 1,155,000.-, effective as per 01012013. This provision has been socialized based on SK No. 036CEO 2HR PSM 2012013 concerning the Wage of Daily Labor BHL PT. SIP-Lampung. In consideration of the above Governor Decree then decide to adjust the wage of daily workers BHL to become Rp. 46,200day. This decision comes into force from 01012013. At MSJA Unit, although located in the region of Mesuji Regency, the wage stipulation refers to the same Governor Regulation to follow the Tulang Bawang UMK, i.e. Rp. 1,155,000.-. This is because in the Mesuji Regency as expansion regency there is no APINDO so as not to stipulate by itself. Company stipulates the same as that of SIP prevailing in Tulang Bawang Regency. With respect to the UMK regency minimum wage provisions the workers in the field have know it precisely. This is known from the interviews with a number of BHB workers taken by sampling of harvesting personnel. They inform that daily wages are Rp. 46.200,- working fulltime for 25 working days per month they will receive basic wages of Rp. 1.155.000,-,. On the wage payment receipt of June 2013, under the name of NIK: 09004Suryaningsih SKU-H status from MSJA Unit it is written Rp. 1.172.500,- and on the payment receipt of NIK : 13007 Toni Yanto a worker of GALA Unit SKU-H status the wages are written Rp. 1.155.000,-. The UMK provisions are imposed to the workers with BHL and PKWT status, and the first year SKU-H. Company maintains company rules in the form of: 1. Collective Labor Agreement PKB between PT. SIP of Tulang Bawang Regency, Lampung: BH.No: 182PT.SIP1989 and PUK.SPPP-SPSI Trade Union of Tulang Bawang with Registration No.: 063KPTSPCSPPP.SPSITBXII2005, for 2011-2013 period, and 2. Company Regulation of PT. SMART Tbk, version 2013-2014. Company provides facilities and infrastructures to support and ensuring decent life. The following is the List of Existing Welfare Facilities in PT. Sumber Indah Perkasa, SBYE Estate, GALA KKPA and MSJA KKPA per June 2013. No. Type of Structures Unit Location Total SBYE GALA MSJA 1. Staff Housing Unit 31 12 11 54 SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 46 of 82 2. Employee Housing Unit 437 14 20 471 3. Mosque Unit 4 1 1 6 4. Church Unit - - - - 5. Kindergarten Unit 1 - - 1 6. Primary School Unit 1 - - 1 7. Smart House Unit 1 - - 1 8. Clinic Unit 1 - 1 2 9. Employee Rest House Unit 2 - - 2 10. Day Care Unit 4 - - 4 11. Cooperative Unit 2 - - 2 12. Soccer Field Unit 3 - - 3 13. Badminton Court Unit 4 2 1 7 14. Volley Court Unit 4 - 1 5 15. Tennis Court Unit 1 - - 1 16. School Children Transport Unit 1 1 - 2 The provisions on the rights to have housing facilities are regulated in PKB. It is also regulated in a circular issued by each Unit Manager. For example, Circulars concerning SKU Workers’ Rights, issued by the Unit Manager of GALA No. Reff: 001MSJA01201. It is stated that when an employee is promoted to be SKU employee either Daily SKU SKU-H or Monthly SKU SKU- B he will be given his rights. Points 4, 7, and 8 say that they will have a housing facility without furniture, but with free water and lighting. For staff employee, housing facility will be furnished with furniture as stipulated in Remuneration – Housing Facility document no.doc: NOM F- 01702-00 approved by MD Strategic officials, valid from 01052006. This provision applies to employee of category HG, F, DE, to CB. Company has entered into a contract with contractor that requires the contractors to comply with applicable regulations on employment. Evidence can be seen in the contract or SPK Working Order : 1. SPK No. KUD-KSGALASPKL-LJanuary-12-010-FFB Transportation Loading between Gala Manager vs Nurohim contractor, as follows : - Article 5 on Terms and Specification of Work, paragraph 4 the requirements to be furnished with Vehicle Holder Book, Vehicle Registration Card, Inspection Certificate, and First Aid Kit. - Article 4, the requirements to include in worker’s insurance and pay the premium by the 2 nd party. - Article 5 paragraph 20, stressed that the contractor shall comply with the Department of Manpower and Transmigration’s laws and regulations. - Article 7, concerning Work Accident, where the second party Nurohim shall pay the wage of workers according to the UMK and include his workers in jamsostek program. 2. SPK No. 027GALAJKTO042013 – Box Culvert dated 22042013, between Director The Biao Leng, and Pedy Harianto and Arifin PT. Citra Kurnia Waway, contractor, i.e.: - Article 8 concerning liabilities in the case of Work Accident, the second party contractor shall pay the worker compensation. - Article 4 concerning the mandatory Jamsostek registration SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 47 of 82 However, both SPKs do not expressly specify about work accident prevention, i.e. the use of PPE. This is established as observation. Compliance status: Full Compliance 6.6 The employer respects the right of all personnel to form and join trade unions of their choice and to bargain collectively. Where the right to freedom of association and collective bargaining are restricted under law, the employer facilitates parallel means of independent and free association and bargaining for all such personnel Company already has a Trade Union. The policy concerning permission to establish a trade union is contained in the Circular Letter from the CEO-2 concerning Trade Union Freedom, No. 094CEO2SE122010, dated 14122010, that the freedom of association in a trade union is the worker or employee’s fundamental rights as regulated in Act No. 212000 on Trade Union or Labor Union. The existing trade unions are only one and covering all Units both Estates and Mills. The union has been registered as in the Decree of Branch Board of Agricultural and Plantation Trade Union Federation of SPSI of Tulang Bawang Regency No. 026KptsPCSP.PP-SPSITBVI2007, dated 5062007 concerning Endorsement of Work Unit Leaderships of SP.PP SPSI PT. SIP for 2007-2012 service period and has a Collective Labor Agreement PKB book with a registration number according to the Decree of the Head of Department of Manpower of Lampung Province No. KEP.188.44811III.0503I2011. The applicable PKB is that of 2011-2013 periods. The Trade Union Leadership terms are now extended in accordance with SK No. 100KptsPCSP.PP-SPSITBVI2012 concerning Stipulation on Work Unit Executive Board of SP.PP-SPSI PT SIP, dated 11062012, in the third dictum: “to give a full mandate to PLT PUK SPSI PT SIP to organize the work unit meeting Musnikin November 2013. The second dictum: to endorse executive boards of PUKSPSI PT SIP there are 6 workers being endorsed. Currently the total number of PT SIP Trade Union members, data of May 2013, is 1,102 people. This membership is automatic in nature, when one becomes a worker of minimum SKU-H status. Currently, the member card as proof of membership is not produced yet. The names of members are registered in the List of Trade Union Member of respective work unit. Bipartite Cooperation Body LKS has also been established in each Unit and is already approved by local Department of Manpower. For example, the LKS of PT. SIP MSJA, 2013- 2015 Period, No.: KEP 56024III.04MSJLKS-BPV2013 dated 8052013 by Head of Department of Manpower and Transmigration of Mesuji Regency. The membership is composed of 11 company representatives to 10 worker representatives. Company provides facilities to smooth Trade Union activities, in the form: - A room for Trade Union office - Desks, chairs, stationery, - File cabinet - A meeting table and chairs - Water dispenser - Uniforms clothing for the trade union board members totaling 16 pieces. - A freedom to use office administration facility. SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 48 of 82 - Fostering the treasury by KTU relating to bookkeeping Records of meeting both internal and external, as sample some can be reported as follows: - Minutes of SPSI meeting with the Management of PT SIP Lampung dated 31012013, with subject “Discussion on workers’ aspiration and request”, attended by 17 workers at TT by PUK SPSI-Sopuan, EM Gala, and HRD Jakarta. - Letter of Acknowledgement of PT. SIP Gala LKS Bipartite meeting, dated 23022103, to discuss the payment of back pays based on Lampung Governor Decree. - Letter of Acknowledgement of PT. SIP MSJA LKS Bipartite meeting, dated 1342013, to discuss the payment of back pay of harvesting personnel that should refer to Circular Letter of Dept. Agro. No. PSM IISE187III2013, effective date 1012013. - Minutes of PT SIP Gala Bipartite meeting, dated 1542013, discussion on harvesting personnel wages 2013 and fines of production foreman. Compliance status: Full Compliance 6.7 Children are not employed or exploited. Work by children is acceptable on family farms, under adult supervision, and when not interfering with education programs. Children are not exposed to hazardous working conditions Company is very stringent in selecting the candidate employee in order to prevent under age workers, the minimum should be 18 years old. This provision is regulated in: - PKB article 7 concerning new employee recruitment, paragraph 4, at the minimum 18 years old. - Government Regulation Chapter II Work Relations, Article 5, paragraph 2 that candidate worker should be the minimum 18 years old. - Circular Letter from HR Director to all Unit Head, No. 002SE-HRDV0309, date 3132009 with subject: Minimum Age Limitation, swehubu. Act No. 13, article 68, concerning child employment prohibition, so the minimum age of employee recruitment is 18 years old. The evidence of implementation of this policy can be seen in the following data: - In the Summary Data of GALA SKU Employee, the youngest work entry age is 18.31 years old, under the name of Burhan Hidayat, born 421993, entry into work on 2072011, - In the Summary Data of MSJA SKU Employee, the youngest work entry age is 20 years old, under the name of Eli Nurwanto, born 26031986, entry into work on 01102006. Compliance status: Full Compliance 6.8 Any form of discrimination based on race, caste, national origin, religion, disability, gender, sexual orientation, union membership, political affiliation, or age, is prohibited Company gives equal opportunities to everyone to work in Company. The documents: 1. HR Policy No. A-001-00, effective 192005, issued by Managing Director Strategic, point 2, states that in principles Organization employs competent individuals in accordance with position requirements without discrimination by ethnic, race, and religion”. 2. Employment Recruitment Policy: Provision on Recruitment and Selection Outside Jakarta no. SDM A-006-00, dated 192005, regulates that recruitment of manpower does not define particular ethnic, sex, as well as religion as requirements. It is also mention minimum age of 18 years old.” As evidence, worker composition in each Unit can be seen in the data as per May 2013, from data sampling as follows: SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 49 of 82 Data of GALA Estate BHL: - Sex: Male 364, Female 2. - Religion: Islam 365, Christian 1 - Ethnic: Javanese 360, Ogan 1, Lampung 4, and Sundanese 1. Data of MSJA Estate SKU: - Sex: Male 51, Female 2 - Religion: Islam 50, Christian 2, and Hindu 1. - Ethnic: Javanese 49, Palembang 2, Bali 1, and Sundanese 1. As evidence, worker composition in each Unit can be seen in the data as per May 2013, from data sampling as follows: - Data of BHL, GABA Estate - Sex: Male 269, Female 114. - Religion: Islam 378, Hindu 4, Christian 1 - Ethnic: Javanese 375, Palembang 1, Balinese 4, and Sundanese 1. - Data of BHB, GABA Estate: - Sex: Male 16, Female 276 - Religion: Islam 291, and Hindu 1 17. Ethnic: Javanese 286, Palembang 2, Lampung 1, Balinese 1, and Sundanese 2. The plantation and mill is located in the transmigration area where the majority of transmigrant is Javanese and Moslem. Job vacation format also does not mention sex, ethnic, or religion for job in general—that can be worked on by men or women. For example, in GALA Unit, Job Vacation for Office Administration Agronomical Clerk, dated 2682012, the listed requirements: malefemale, and over 18 years old. Compliance status: Full Compliance 6.9 A policy to prevent sexual harassment and other forms of violence against women and to protect the reproductive rights is developed and applied Company has established a policy related to prevention of sexual harassment in a circular letter Socialization on Harassment Sexual Issues, No. 003CEO2-SE012011, dated 10012011. There should be socialization to all employees concerning prevention and handling of sexual harassment issues, so as to increase legal awareness and respect norms and ethics in the plantation work units of Sinar Mas II. Samples of evidence of the implementation of prevention of sexual harassment activities of socialization in GALA and MSJA Units are as follows: - GALA Unit, there is the Letter of Acknowledgement of Socialization on Sexual Harassment carried out on 15062013, to 25 K3T representatives, and on 1372013, to 29 staff’s wife’s and male workers. - MSJA Unit, there is the Letter of Acknowledgement of Socialization on How to Deal With SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 50 of 82 Sexual Harassment held on 14032013, there are 13 participants for the staff’s wife’s and male workers. Nevertheless, in GALA Unit, this socialization has been made only to 23 representative of K3T personnel and 29 staff’s wives and male workers. There is no evidence that it is made to 366 PKWT workers and 486 BHL personnel. In MSJA Unit, there is no evidence that socialization has been made to BHLBHB workers, only to 13 staff’s wives and male workers. This is established as minor nonconformity. Company policy on protection of reproductive rights and documented has been included in: - Government Regulation chapter IV, article 23 concerning Annual Leave, Article24 Long Rest Period, Article 25 Maternity or Miscarriage. - Memorandum No. 001MemoVPA PSM2042011 dated 842011, concerning prohibition of pregnant and breast feeding workers to work as sprayers. - Circular Letter No. 095CEO2-SE122010, dated 14122010, concerning Menstrual Period Permit Granting, where working is not permitted in the first and second day. Record evidence of the policy implementation of reproductive rights protection is: - Sick Leave Certificate under the name of Wiji Astuti, 31 years old, GALA Unit, No. 0012PKM-GRSEXSKSVI2013, H2 pregnant leave and there is filled in Employee Leave Application Form from 472013 to 1102013 90 days, signed by Manager. Company has had a policy relating to employee grievances, i.e.: 1. PKB Article 26 Grievance Settlement, and 2. SOP on Grievance and Dissatisfaction Handling No. SOPNPSMARTXIIMCAR001, issued date 172010. Records of worker complaints and grievance are kept and followed up. Each Unit maintains a log book to record worker’s grievance. For example, in GALA as well as MSJA Unit there is a Grievance Log Book that specifies information : Date, Place, Name, Contact details, Issue s, Registration, Response Date, Action, Current status, PIC, and Target Finish. If a worker wants to convey his grievance, he should write a letter, may or may not be official, addressed to the management. Furthermore, the management will read, record, and follow up. From sampling of some of recorded grievances, the management has sought to follow up. Grievance status will be written “Close” when finished. Compliance status: Minor no. 1 Non-conformity 6.10 Growers and mills deal fairly and transparently with smallholders and other local businesses. For Mesuji, there has been a letter of FFB price stipulation from local Plantation Department of Lampung Province on 7 May 2013 stating that on average the FFB price is Rp. 1,136.27Kg and the price company sets to the KUD Krida Sejahtera is Rp. 1,243.00 based on the planting year 10 year and higher. For July, Lampung Province sets Rp. 1,320.61kg as the price for the crops of 10-20 years old. There is SOP for FFB Grading Guidelines and FFB Grading WI No PT SIP-SBYMIK04-1. It contains sorting criteria and penalty provisions for FFB out-of-specification. Company has established the grading system and penalty provisions and has conformed to the provisions stipulated by the Government. Based on the grading system, unripe and less ripe fruits and over ripe fruits will be subject to penalty 50, empty fruit bunches 100. The grading outcome and the percent of fruit subjected to penalty are sent to the KUD in the form of hardcopy and softcopy so that the KUD’s data is updated daily. SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 51 of 82 Sampling of sorting outcome per January 2013 results in 9,446,020 Kg FFB and 13,202 kg penalty from over ripe fruits 50 penalty and empty fruit bunches 100 penalty. The grading determination has conformed to the provisions of the regulation of the Minister of Agriculture No. 395KptsOT.140112005 The setting up of FFB purchasing price follows the prevailing provisions, and the summary of FFB price stipulation from authorized agency is available. Payment has been settled in a timely manner both to cooperatives and contractors. Company should ensure the cooperative’s efforts to communicate pricing methods and price cutting related to costs imposed to plasma members for maintenance and transportation. This is to ensure that all parties understand the contract agreement they entered into, and that the contracts are fair, legal and transparent. Compliance status: Observation no. 11

6.11 Growers and millers contribute to local sustainable development wherever

appropriate Company has in place a policy in the form of company memorandum to perform CSR program throughout the company group in order to comply with Act of RI No. 402007. CSR plan in 2013 covers the aspects of education scholarships, health hospital rehabilitation, posyandu activities, fogging, mass medication, economic empowerment FFB transportation by local contractors, purchasing local materials, infrastructure road improvement, surfacing and social assistance for religious purpose and celebration of day of an important event. Company has a program of prioritizing local contractors to have jobs. Jobs given include printing materials for administration purposes and rice procurement by KUD, FFB transportation, harvesting ladder construction. Samples taken are SPK 001-GABASPK-LI2013- FFB Transport. The SPK has a validity period and terms of payment which is twice a month under the name of Bp. Suradi, May 2013 period. Compliance status: Full Compliance 7 RESPONSIBLE DEVELOPMENT OF NEW PLANTINGS 7.1 A comprehensive and participatory independent social and environmental impact assessment is undertaken prior to establing new plantings or operations, or expanding existing ones, and the results incorporated into planning, management, and operations Not Applicable 8 COMMITMENT TO CONTINUOUS IMPROVEMENT IN KEY AREAS OF ACTIVITY 8.1 Growers and millers regularly monitor and review their activities and develop and implement action plans that allow demonstrable continuous improvement in key operations Company has conducted evaluation regularly to ensure ‘continuous improvement’ through the mechanism of regular management meeting and internal audit activities. SOP no. SOPSPOSMARTLH-16 lists audit internal which is conducted at least once a year. In addition, the management conducts routine meetings both regionally and corporately. Company has conducted internal audit with different objects, such as called Mill Audit Advisory which is performed twice a year. For ISPORSPO, Internal Audit is scheduled at least once a SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 52 of 82 year. ISPORSPO internal audit was carried out by personnel who have had Internal Auditor training, i.e. Maman Surahman, Baby F Nurainy and Hendra Setiawan on 19-26 March 2013. There were 13 findings and all have been closed. Company has developed CSR program for respective units and for the communities in the neighborhood of plasma and main estates. Some of the short-term programs have been implemented for the period of 2013. Company should develop a specific method to evaluate the effectiveness of CSR programs done as input to future program improvement. Compliance status: Observation No. 10 SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 53 of 82 D.Certified Organization’s Acknowledgement of Internal Responsibility D.1. Formal Sign-Off of the Assessment Findings I the undersigned, being the legal representative of the inspected company, agree with the contents of this report and accept the liability in execution of the instructions given in the report. Name Ismu Zulfikar Position Head of Environment and CSR Coordination Signature Date SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 54 of 82 D.2. Statement by the Certifier Body on Behalf of PT. Sucofindo SBU-SICS We, the undersigned declare that the information and conclusions included in this report have been prepared in accordance with rule and standard of RSPO, PC, and that the certification decision has been based upon this information. Verified and Reviewed by: Name Nuzwardy Sjahwil Position SLA LA Auditor Signature Date December, 16 th 2013 Approval: Name Triyan Aidilfitri Position HSE Audit and Certification Department Head Signature Date December, 16 th 2013 SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 55 of 82 List of Abbreviation AMDAL Analisa Mengenai Dampak Lingkungan Environment Impact Study Report ANDAL Analisa Dampak Lingkungan Environment Impact Analysis Report BOD Biological Oxygen Demand BPN Badan Pertanahan Nasional National Land Agency COD Chemical Oxygen Demand CPO Crude Palm Oil CSR Corporate Social Responsibility DOE Department of Environment EFB Empty Fruit Bunch EIA Environment Impact Assessment FFA Free Fatty Acids FFB Fresh Fruit Bunch FSMS Food Safety Management System GMP Good Manufacturing Practice GABA Gedung Aji Baru Estate GALA Gedung Aji Lama Estate GPS Global Positioning System Ha Hectares HACCP Hazard Analysis and Critical Control Point HCV High Conservation Value HCVF High Conservation Value Forest HGU Hak Guna Usaha Land Use Title HSE Health Safety Environment IEMA Institute of Environmental Management and Assessment IPB Institut Pertanian Bogor IRCA International Register of Certified Auditor JAMSOSTEK Jaminan Sosial Tenaga Kerja Labor Social Insurance K3 Keselamatan dan Kesehatan Kerja Occupational Safety and Health KAN Komite Akreditasi Nasional The Indonesian Accreditation Committee KKPA Kredit Kepada Koperasi Primer KLH Kementerian Lingkungan Hidup Ministry of Environment KTU Kepala Tata Usaha Administration Head LCC Legume Cover Crop LSM Lembaga Swadaya Masyarakat NGOs MOU Memorandum of Understanding MSDS Material Safety Data Sheet MSJA Mesuji Estate NA Not Applicable NC Non Conformity NCR Non Conformity Register OER Oil Extraction Rate OSH Occupational Safety and Health SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 56 of 82 OSHAS Occupational Safety and Health Assessment Scheme PC Principle and Criteria PHT Pengendalian Hama Terpadu Integrated Pest ManagementIPM PK Palm Kernel PKO Palm Kernel Oil POM Palm Oil Mill POME Palm Oil Mill Effluent PPE Personal Protective Equipment RSPO Roundtable on Sustainable Palm Oil RSPO NI Roundtable on Sustainable Palm Oil National Interpretation RKL-RPL Rencana Kelola Lingkungan dan Rencana Pemantauan Lingkungan Environment Management Plan – Environment Monitoring Plan SA8000 Social Accountability 8000 SIA Social Impact Assessment SIO Surat Izin Operator SOP Standard Operating Procedure SIP Sumber Indah Perkasa SBYM Sungai Buaya Mill SBYE Sungai Buaya Estate SMK3 Sistem Manajemen – Keselamatan dan Kesehatan Kerja Management System of Occupational Safety and Health SMRM Sungai Merah Mill SMRE Sungai Merah Estate TTD Tim Tanggap Darurat Emergency Response and Preparedness UKL Upaya Pengelolaan Lingkungan Environmental Management Efforts UPL Upaya Pemantauan Lingkungan Environmental Monitoring Efforts WWTP Waste Water Treatment Plant WHO World Health Organization SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 57 of 82 ATTACHMENT-1 MAP SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 58 of 82

1.1. Overlay Map of Sungai Buaya Estate, Gedung Aji Lama Estate and Mesuji Estate

SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 59 of 82

1.2. Map of Rivers

SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 60 of 82

1.3. Map of HCV Sungai Buaya Estate

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1.4. Map of HCV Gedung Aji Lama Estate

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1.5. Map of HCV Mesuji Estate

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1.6. Map of Topography

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1.7. Map of Planting Year Sungai Buaya Estate

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1.8. Map of Planting Year Gedung Aji Lama Estate

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1.9. Map of Planting Year Gedung Aji Lama Estate

SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 67 of 82 ATTACGMENT - 2 NCR SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 68 of 82 Non Conformity Observation Report Organization No. Audit No. Standard. Audit Date : 14-06-2013 TSS, RQ, WS, AMR, RSPO 00003 1 1 RSPO Preliminary ATL Auditor : Organization Rep. : No . Category Clause Std Auditor Description Root Cause Investigation Corrective Action Evidence Audit Team Review 1 2 3 4 5 6 7 8 9 1 Major 2.1 1 TSS The company has a letter of permit of the release of forested areas and or a letter of designation with the APL status for the plantation area of PT Sumber Indah Perkasa. The company does not have permitsIUP for Mill with a capacity of 120 tons of TBShour. So far the company only has a letter of recommendation from the Provincial Service for the management of mills with a capacity of 120 tons TBShour. 1. Letter of the Regional Forestry Office of Lampung Province No. 1052KANWIL- 6TGH-13490 is undocumented in the estate office so that at the time of pre audit it could not be shown to the auditor 2. The IUP does not specify a mill with a capacity of 120 tonshour, but with respect to production capacity, there has been an approval from the State Minister of Corrective Action 1: Document the letter of the Regional Forestry Office of Lampung Province No. 1052KANWIL-6TGH- 13490 at the estate office.Evidence 1:Letter of the Regional Forestry Office of Lampung Province No. 1052KANWIL-6TGH- 13490 has been available.Corrective Action 2:Confirmation to the relevant agencies relating to IUP.Evidence 2:The company has had SPUP that is valid as IUP, while for production capacity there has been an approval from the Closed SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 69 of 82 Investment Head of BKPM. State Minister of Investment Head of BKPM No 46IIPMDN1998 dated 01 July 1998 concerning Letter of approval for expanding domestic capital investment stating that the production capacity becomes 120 Tons of FFB per hour. This was confirmed by the letter of the Head of Capital Investment Coordinating Board and Integrated Permit Service of Lampung Province No 800200BID. VII.062013 dated 01 July 2013 that the Business Permit of PT SIP issued by BKPM Agency for capital investment is equal to the estate business license IUP issued by sectoral technical agency due to the authority granted by the Minister of Agriculture. 2 Major 4.6 ; 5.3 1 RQ At GABA, waste water comes from bathing activity of sprayer personnel flows into the septic tanks, but at Waste water come from bathing activity of sprayer personnel at the SBYE does not enter into the septic Corrective Action : To repair the bathroom’s sewer so that used water from the sprayer bathing activities will not Closed SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 70 of 82 SBYE it flows to public ditches. This is potentially to contaminate water that will poison flora, fauna, and human. tanks or a catchment and still flows into public ditches. go to public ditches. Evidence: Used water from the sprayer personnel bathing activities has been directed to the septic tanks Photo documentation is available. 3 Major 5.6 1 RQ The measurement results for vibration, odor, and noise are not obtained because there is a problem with the environmental testing laboratory’s equipment. Vibration and odor tests have been carried out but the results are not obtained yet. Corrective Action:Perform vibration and odor tests in collaboration with an accredited laboratory.Evidence:The results of vibration and odor tests have been available. Closed 4 Major 5.4 1 RQ The company does not have a record of land use trajectory from secondary forest into palm land. The company does not have a record of land use a minimum 2 years before the land is cleared for plantation business. The company does not have a record of land use trajectory from secondary forest into Document of land use trajectory cannot be shown because the prior status of land is APL Corrective Action: Document of land use plan prior to the plantation opening will be searched for. Evidence: The document is available in the form of land satellite image 1988 – 1989. Closed SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 71 of 82 palm land. The company does not have a record of land use a minimum 2 years before the land is cleared for plantation business. 5 Major 4.1 1 WS The SOP on Seed Nursery SOPSMARTMCARII ITA-BBT, rev.00, 192012 and IKSMARTMCARIIIT A-BBT06 on Seedling Acceptance and Planting does not yet explicitly regulate the obligation to use a certified seed. SOP does not include sentences requiring the use of certified seeds. Corrective Action: Develop a mechanism that requires the use of certified seeds. Evidence: The mechanism to use certified seeds has been available in the form of SE from VPA PSM2. Closed 6 Major 4.1 1 WS There is no SOPWork Instruction that explicitly and in details regulates planting on peat land SOP of planting on peat land is unable to be shown because the company has committed not to make a new planting in peat land area. Corrective Action: Develop a SOP that regulates planting in peat land replanting area. Evidence: There has been a SOP regulating on planting in peat land replanting area. Closed 7 Major 4.7 1 WS The company, for SBYM and SMRM Mills, currently does not have fire mitigation officers as regulated in Fire warden training is not already conducted at SBYM and SMRM units. Corrective Action : Deliver fire mitigation training to fire warden in collaboration with relevant Closed SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 72 of 82 Kepmenaker No. 186MEN1999. agencies.Evidence :Fire warden training has been conducted by Local Manpower and Transmigration Service Disaster Mitigation Body of Tulang Bawang Regency on 5 July 2013 8 Major 4.7 1 WS There are some officers of fire fighter squad in the Emergency Response Team Structure without evidenced of fire mitigation training. They are: SBYE, 1 people, SMRM 5 out of 7 people, and SMRE 5 out of 8 people. At the implementation of fire mitigation training, some of the emergency response team’s members were not present so that not all the people have fire mitigation training. Corrective Action: Conduct training in using Apar for fire fighter squad that has registered in the structure of emergency response team. Evidence: Officers of fire fighter squad registered in the emergency response team have received fire mitigation training. Closed 9 Major 4.7 1 WS Simulation on dealing with fire emergency situation has not been carried out in SBYE and GABA units. Fire simulation has not conducted in each work unit of estate and mill, because to date fire simulation is carried out jointly Estate and Mill at SBYE. Corrective Action: Conduct fire emergency response simulation. Evidence: Documentation of the simulation implementation has been available. Closed 10 Major 4.7 1 WS Data of worker health showed that there is no examination of cholinesterase aspect Periodic health examination has been conducted routinely, but the examination of Corrective Action: Conduct Cholinesterase examination for chemical warehouse Closed SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 73 of 82 on workers touching B3, such as: sprayers and chemical warehouse officers. Cholinesterase has not been conducted yet on the sprayer personnel and chemical warehouse officers. officers and sprayer personnel. Evidence: Chemical warehouse officers and sprayer personnel have their cholinesterase examined The test results from Prodia Laboratory have been available. 11 Major 4.7 1 WS During a visit to Mill area, some workers were found not using PPE, sampling: 1 at SMRM, in the area of St. Sterilizer, and Nut- Kernel, not using earplugmuff. 2. No apron was available for workers in boiler area. Noise test value at St. Sterilizer and Nut Kernel is 84 - 85 dBA. . Corrective Action: Risk analysis has been reviewed based on suggestion from the Auditor by providing ear plugmuff in ST Sterilizer and Nut Kernel.Evidence :Minutes of ear plug ear muff supply acceptance have been available. Closed 12 Minor 6.9.1 1 WS There is no evidence that sexual harassment socialization has been conducted in MSJA unit. In addition from the evidence of socialization records available is still extremely small in number. Sexual harassment socialization in MSJA has been conducted to the staff’s wives and some female workers but the documentation is kept in the MSJA SPO secretariat so that it was unable to be shown during document checking by Corrective Action: Document the evidence of sexual harassment socialization. Evidence: Evidence of sexual harassment socialization is available and documented. Not Closed This NCR will be seen in certifica tion audit SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 74 of 82 auditor in the Lampung Regional office. 13 Observati on 6.1 1 TSS It would be better that CSR plans developed are capable of ensuring welfareskill improvement. The method of need identification is employed as a basis to determine priorities of the CSR program in villages outside the company area. It is suggested the company establishes a short- and long-term plan and a method of evaluation to ensure that the CSR program is effective and successful as an indicator of improvement. The short-term CSR plan has been available in the form of Annual CSR Program. The Five Year CSR Strategic Plan of 2014 – 2018 periods along with the performance indicator for evaluating CSR activities are under preparation process. Corrective Action: Finalize 5 year CSR strategic plans. Evidence: The draft CSR strategic plan of 2014 – 2018 period along with performance indicator for evaluating CSR activities has been available. Closed SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 75 of 82 Non Conformity Observation Report Organization No. Audit Standard. Audit Date : 19-07-2013 TSS, RQ, GGU, YSF, WS, RSPO 00003 No. 02 1 RSPO Certification ATL Auditor : RSPO 0004 Organization Rep. : No. Category Clause Std Auditor Description Root Cause Investigation Corrective Action Evidence Audit Team Review 1 2 3 4 5 6 7 8 9 1 Minor 6.9 1 WS The implementation of sexual harassment socialization to employees is limited compared to the number of workers. Data showed : -In GALA Unit, the number of workers has been socialized to 23 safety team and 29 staff’s wives and male workers. For BHL and PKWT personnel are63 out of 872 workers only 7.2 . -In MSJA Unit, no evidence is found that the socialization has been made to BHLBHB workers; it is only to 13 staff’s wives and female workers. Sexual harassment socialization has been conducted to the workers, but the documentation was cannot be showed at the time of audit. To completed the documentation of sexual harassment socialization. Evidence : Documentation of sexual harassment socialization is available at SPO secretariat. Closed SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 76 of 82 2 Obs 4.6 1 YSF Company has used herbicide registered in Pesticide Commission of the Republic of Indonesia but the use of restricted pesticide should be reduced gradually and substituted by a more environmentally friendly herbicide and safer to field operators. The company still apply restricted pesticide i.e. paraquat. The management has issued memo to reduce the paraquat No. 002MEMO-VPA PSM2042011. The restricted pesticide will be monitored yearly to see the trend of paraquat reduced. Evidence : Graphic of restricted pesticide use year 2011- 2013 showed the reduce of paraquat used. Closed 3 Obs 4.7 1 YSF Two units of Light Fire Extinguisher in diesel fuel warehouse and KKPA GALA warehouse should be inspected more carefully to ensure the content and pressure of the extinguisher so that they can be used during the emergency. The personnel checked the fire extinguisher inaccurately. The Head of P2K3 retraining the personal who responsible to check the fire extinguisher. To ensure the monitore result of fire extinguisher meet with the actual condition. Evidence : Letter of reminder from Head of P2K3 to secretary with the subject of the fire extinguisher monitoring system. Closed 4 Obs 4.7 1 YSF Company has undertaken workers health examination covering cholinesterase and audiometry but for those working with risks of chemical exposure should be added with spirometry examination to ensure their lung health. The workers with exposure to chemical material hazard were not checked for spirometry. To conduct identification the workers with risks of chemical exposure and gradually will conduct spirometry checking. Evidence : 1. List of worker who needs to be checked for spirometry. 2. Medical check program for spirometry. Closed SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 77 of 82 5 Obs 2.3 1 TSSGG U Organization has made a map but the map should have a sufficient scale, at least 1 : 100.000 in accordance with Decree of the Ministry of Forestry No. 48menhut-II2004. The company has the different scale for all maps. Map will be adjusted to be scale 1 : 100.000 Evidence : Map with the scale 1:100.000 Closed 6 Obs 5.2 1 TSSGG U Organization had SOP on HCV Management, it specifies that monitoring or patrol is carried out every two weeks but in GALA the last monitoring is on 24 June 2013. KKPA GALA Estate has no data for monitoring HCV for July 2013. HCV monitoring and patrol will be conducted every 2 weeks. Evidence : HCV Monitoring and patrol is available. Closed 7 Obs 5.2 1 TSSGG U Organization has performed monitoring and contained in HCV Monitoring Report, but it should establish Person in Charge PIC and due date of the recommendation specified in the HCV monitoring report to see the follow up and progress of such recommendation. There is no column for PIC and Action Plan at Form HCV Monitoring. Completed the form with edit PIC and Action Plan. Column. Evidence : Revision of Form HCV Monitoring. Closed 8 Obs 4.7 1 WS Company already complete with the provisions of Decree of the Ministry of Manpower No. 1861999 related to the number of fire mitigation personnel in mill area. But it only trained 20 personnel for both mills it should be 12 personnel for each mill. It should ensure to gradually conduct training to cover the remainder in class D, C, B and A. The simulation of fire fighting has conducted but the number of the fire fighter was not meet with the government regulation Kepmenaker No. 186 Tahun 1999. To fulfill the number of fire fighter to meet with the Kepmenaker No. 186 Tahun 1999. Evidence : Documentation of fire fighter training. Closed SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 78 of 82 9 Obs 4.8 1 WS In GALA, two SPKs are found not expresivvely specifying the provisions of PPE mandatory use. They are SPK No. 027GALAJKTO042013 – Box Culvert, and SPK No. KUD-KSGALASPKL- LJanuary-12-010-FFB Transportation Loading. During tender process, the requirement of safety aspect has been informed to the contractor, but when the MoU issued there is no safety requirement stated. In every MoU, the safety standard should be stated mandatory. Evidence : The revision of MoU. Closed 10 Obs 8.1 1 TSS Companyshould develop a specific method to evaluate the effectiveness of CSR program done as input to future program improvement. Yearly CSR Program has been setup for each unit, but not yet covered the culture program. For the strategic planning year 2014-2018 has addressed the vision and mission to develop and maintain the culture of local people. The company will re- identification the existing indigenous people. If there is then the company will setup the CSR to develop and maintain the culture of indigenous people. Evidence : Revise CSR Program. Closed 11 Obs 6.10 1 TSS Company should ensure cooperative’s efforts to socialize aspects that become a factor in price cutting related to costs imposed to plasma members for maintenance and transportation costs. Proof that all parties understand the contract agreement they entered to, and that the contracts are fair, legal and transparent. The company has conducted the socialization to the cooperation staff and coordinator staff, regarding the factor in price cutting related to costs imposed to plasma members for maintenance and transportation costs. But the socialization was not sufficient some of the members were found well not understand for the subject. The company will conduct monthly meeting and to socialized the factor in price cutting related to costs imposed to plasma members for maintenance and transportation costs. Evidence : The documentation of meeting schedule between company and cooperation is available. Closed SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 79 of 82 APPENDIX PT. SUMBER INDAH PERKASA – SUNGAI BUAYA MILL RSPO SUPPLY CHAIN CHECKLIST – MASS BALANCE MODUL PT. Sumber Indah Perkasa – Sungai Buaya Mill SBYM is implemented the supply chain system procedures as required in RSPO certification. The company has set the supply chain system categorized as Mass Balance scheme.

A. Documented Procedures