Pesticides are used in a way that do not endanger health or the environment.

SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 40of 124

4.6 Pesticides are used in a way that do not endanger health or the environment.

4.6.1 Justification of all pesticides used shall be demonstrated. The use of

selective products that are specific to the target pest, weed or disease and which have minimal effect on non-target species shall be used where available. Major The Company already has a list of pesticides used based on the identification of each pests and plant diseases. The Company has a list of chemicals used by the WHO classification, i.e: 1. Herbicide  Metaprima 20 WDG Methyl metsulfuron, classificationU  Starlon 665 EC Triklopir, classificationII  Prima up 480 AS Isopropilamina gliphosat, classification III 2. Insecticide  Acephate Asefat, classification II The Company had a census for each Division and coordinated by the foreman in each division. The Company had census workers that have been appointed as EWS team. The Company already conducted training of IPM Control on May 21, 2016. Conclusion: conform

4.6.2 Records of pesticides use including active ingredients used and their LD50,

area treated, amount of active ingredients applied per ha and number of applications shall be provided. Major The Company has a list of chemicals used by the WHO classification, i.e: a. Herbicide  Metaprima 20 WDG Methyl metsulfuron, classificationU  Starlon 665 EC Triklopir, classificationII  Prima up 480 AS Isopropilamina gliphosat, classification III b. Insecticide  Acephate Asefat, classification II The Company has a record of chemicals using, for example in 2016, the company has applied Prima Up isopropyl glyphosate of 3,496.17 L for 4,352.09 Ha planted, Metaprima Methyl metsulfuron of 236 kg. Conclusion: conform SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 41of 124

4.6.3 Any use of pesticides shall be minimised as part of a plan, and in accordance

with Integrated Pest Management IPM plans. There shall be no prophylactic use of pesticides, except in specific situations identified in national Best Practice guidelines. Major The Company has Guideline Technical Agronomy in which there are SOP Pest and Plant Disease Control such as pest control of Worm Eater Leaf UPDKS 041 PT VI 2014, pest control rats 042 PT XII 2014 and pest control beetle horn 045 PT VI 2014. The Company also has early warning system EWS through regular pests monitoring every month such as fire caterpillar, bags caterpillar and ganoderma. Conclusion: conform 4.6.4 Pesticides that are categorised as World Health Organisation Class 1A or 1B, or that are listed by the Stockholm or Rotterdam Conventions, and paraquat, are not used, except in specific situations identified in national Best Practice guidelines. The use of such pesticides shall be minimised and eliminated as part of a plan, and shall only be used in exceptional circumstances. Minor The Company already has document for monitoring toxicity of pesticide on Pesticide Monitoring Units that monitored in January 2016. The Company has conducted spraying training for staff, foremen and employees working as a sprayer. Company has a policy to discontinue the using paraquat which is recorded in an MI Internal Memo No. 001TAPMIN-EST-HOII2013 concerning Paraquat Herbicide Booking Termination dated 22 February 2013. Company has stopped using Paraquat since March 2013. Conclusion: conform 4.6.5 Pesticides shall only be handled, used or applied by persons who have completed the necessary training and shall always be applied in accordance with the product label. Appropriate safety and application equipment shall be provided and used. All precautions attached to the products shall be properly observed, applied, and understood by workers see Criterion 4.7. Major Pesticide Handling was included in SOP K3L TAPSOP120-SHE0001 Section Handling Agronomy Environment. Pesticides are always applied in accordance with the product label. There are MSDS for pesticides used readily available for easy reference. The company has monitored PPE spray and recorded in the spray monitoring book in each Afdeling. Based on employee’s data, there were 51 people worked with pesticides. The company has had technical guidelines spraying jobs such as technical guidelines spray circle. At site visit to afdeling C block C17, spraying workers have used full PPE during work time. The workers use PPE glassess, aprons, glooves, boots and masks. The workers have received training handling and application of pesticides. If the PPE is damagedbroken while working, then the worker must report to the foreman for replacement PPE immediately. SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 42of 124 Conclusion: Conform 4.6.6 Storage of all pesticides shall be according to recognised best practices. All pesticide containers shall be properly disposed off and not used for other purposes see Criterion 5.3. Major Pesticide Handling was included in SOP K3L TAPSOP120-SHE0001 Section Handling Agronomy Environment. Based on observations in the central warehouse, herbicide container waste was stored in a warehouse of hazardous waste. Storage of hazardous and hazardous waste are arranged in TAP SOP 120-SHE 0001 CHAPTER VI.3 Conclusion: conform 4.6.7 Application of pesticides shall be by proven methods that minimise risk and impacts. Minor The company has had technical guidelines spraying jobs such as technical guidelines spray circle, path and TPH; spot spraying. Implementation pesticides application is described in SOP K3L TAPSOP120-SHE0001 regarding the handling of agrochemicals. The Company has conducted socialization to the sprayer. The socialization was conducted in Cambodgien A on February, 16th 2016. During a visit to the field, spraying workers already apply pesticides according to applicable SOP. Conclusion: conform 4.6.8 Pesticides shall be applied aerially only where there is documented justification. Communities shall be informed of impending aerial pesticide applications with all relevant information within reasonable time prior to application. Major There are no pesticide applied aerially. Conclusion: NA 4.6.9 Maintenance of employee and associated smallholder knowledge and skills on pesticide handling shall be demonstrated, including provision of appropriate information materials see Criterion 4.8. Minor The company has had a training program on site mill and estate. The training is reported monthly. The training that have been implemented include training for officers spraying, fertilizing, safety for transportation, socialization of use PPE, fire extinguisher Training for farmers has been carried out between the months of October to December 2016 include harvesting, fertilizing, maintenance, weed control, OHS and HCV conservation. One of the internal trainings in December 2016 was the SHE and P2K3 Training. The company conducted report flowchart crash training in October 2016. Conclusion: conform SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 43of 124

4.6.10 Proper disposal of waste material, according to procedures that are fully

understood by workers and managers shall be demonstrated see Criterion 5.3. Minor The company has set SOP regarding proper disposal of waste material in the Manual of Environment and OHS No. TAPSOP220-SHE0001 Chapter VI Hazardous Waste Management. There are training provided to workers and managers on proper waste disposal. The company has cooperated with PT Primanru Jaya as carrier and collector hazardous waste based on contract No. 142 MOU-KIS II 2016. The company utilize waste water for land application. There was report of waste water utilization during 2016 and had been reported to the relevant agencies on January 11, 2017. Conclusion: conform 4.6.11 Specific annual medical surveillance for pesticide operators, and documented action to treat related health conditions, shall be demonstrated. Major Based on the workers database on March 2017, there were 51 people worked with pesticides. Pesticide operators get specific medical examination regularly twice a year. Specific medical examination cholinesterase 2016 has been carried out on April 27 th until May 03, 2016 and October 28 rd until November 09, 2016. Report of medical examination PT BBB from February 2016 to January 2017 has been reported to The Labor Service on March 4, 2017. In 2017 the company has arranged schedule for this medical examination on April and October 2017. Implementation of medical examination be conducted by third party that is Laboratory Prodia from Jambi. During audit surveillance II on 13-17 March 2017, team auditor visited afdeling H block G5-G5A, Afdeling D block D12, and Afdeling C block C7. Based on report of medical examination February 2016 until January 2017 and interview with workers in the field, not all of pesticide operators have been tested for cholinesterase twice as required by regulation of Permenaker 31986 as in the name of Mrs Nely in afdeling B, and Mr Rasik in afdeling G. This raised as Major Nonconformity No.6. The company clarified that this incident was due to the assistant and the foreman employing non-spray workers on behalf of Nely Afdeling B to do the spray work so that the employee had not received a cholinesterase examination. In addition, the Employee on behalf of Rasik is an employee appointed as a spray team one month after the implementation period of medical examination. Conclusion: Major NCR No.6 4.6.12 No work with pesticides shall be undertaken by pregnant or breast-feeding women. Major SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 44of 124 The company has a policy to not employ pregnant and lactatingbreast-feeding women for spraying activity, as stated in IK-12 B-OIL 2014 point 4. There are list of female workers handling pesticides. It is advised that company to be more persistent in conducting pregnancy test to all female workers who work with chemicals. The company has a system to identify pregnant and breast feeding women with test pack pregnant every month. Sample for monitoring in February 2017, pregnant test was conducted in 21-28 Februari 2017. There are evidence showing that pregnant and breast-feeding women are not allowed to handle pesticide for example on behalf of Mrs Suseni. Conclusion: Conform 4.7 An occupational health and safety plan is documented, effectively communicated and implemented

4.7.1 A health and safety policy shall be in place. A health and safety plan covering

all activities shall be documented and implemented, and its effectiveness monitored. Major The Company has established integrated policy with Environment, Safety and Occupational Health corporately and signed by the Director of PT. Brahma Binabakti, on February 5 th , 2013. It was written in an appropriate language. Workers aware of and understand the policy. The LK3 policy already contained a commitment to improve environmental performance and K3, communicate policies and procedures to all employees and stakeholders, obey laws, identify and assess, and control all the risks and perform continuous improvement to prevent workplace accidents and occupational diseases. The company had target and safety plan in 2017. Strategic objective about safe and healthy working environment SHE index 80 Green. Conclusion: conform 4.7.2 All operations where health and safety is an issue shall be risk assessed, and procedures and actions shall be documented and implemented to address the identified issues. All precautions attached to products shall be properly observed and applied to the workers. Major The Company has established procedures to conduct assessment of operational risks that could threaten the safety and health, i.e. SOP of Identification and Evaluation of Environmental Aspects and OHS under Section III.1 TAP SOP 120-SHE 0001. List of OHS and environmental impact identification was established set in 2014. It was a list of environmental and OHS impact assessment from all of OHS activity. Risk assessment have been conducted for all operations where health and safety is in issue such as mill process, warehouse, workshop and clinic. The Company already made procedures SOPs and work instructions WI related to jobs were at risk to safety and health. Some of them are: potential physical and health hazards and the environment arising from the use of chemicals in the workplace. SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 45of 124 The Company has made safety procedures and precautions, i.e. SOP of chemical hazard communication. The company has monitored and measured work environment in accordance with Permenaker no. 13 in 2011, covering a threshold value factor of physics, chemistry, and biology in each work area. An assesment of work environmentwas conducted on Oct, 7 2017 including noise, vibration, lighting, ISBB Indeks Suhu Bola Basah, and dust. The company has conducted special medical examination including spirometry, audiometry, and cholinesterase. Spirometry examination was conducted on April 27, 2016 to 24 workers from various work units. The results of spirometry examination declared that there are 9 people workers get light restriction and another workers was normal. Audiometric examination was conducted on April 27, 2016 against a genset operator. The resut of examination are normal. While cholinesterase examination was conducted twice a year ie on 3 May and 27 April 2017 for the first semester, October 28 and November 9, 2016 for the second semester. The company has equipment requiring licenses for operrator such as Boilers, Skidsteer loaders, Wheel Loaders, Static cranes, and hoisting cranes. Currently, the company already has 5 licensed operators Conclusion : Conform 4.7.3 All workers involved in the operation shall be adequately trained in safe working practices see Criterion 4.8. Adequate and appropriate protective equipment shall be available to all workers at the place of work to cover all potentially hazardous operations, such as pesticide application, machine operations, and land preparation, harvesting and, if it is used, burning. Major The company has set a competency matrix for every function. Identification of training has referred to the competency gaps and proposals of each section. Procedure of employee training has included the evaluation of the effectiveness of training. The Company has established a training program related to the environment, safety and health, and RSPO in 2016. The company has been providing personal protective equipment for their employees. Regarding PPE, It is found non-conformity that no specification according to the standard of each PPE applied to each type of work. Based on sampling, it is founds apron in warehouse afdeling H that made very thin and can not be sure workers are protected from contamination of pesticide material. This is raised as Major nonconformity. The Company clarifies that this nonconformity is due to different PPE specifications at PT BBB. The Company did not yet made work instructions related to the standardization of Personal Protective Equipment at PT BBB in every process. As for the findings of PPE apron because there is no standardization of Personal Protective Equipment as a reference in the purchase of apron. Conclusion: Major NCR No.3 SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 46of 124

4.7.4 The responsible personpersons shall be identified. There shall be records of

regular meetings between the responsible persons and workers. Concerns of all parties about health, safety and welfare shall be discussed at these meetings, and any issues raised shall be recorded. Major The company already set up a committee which will be responsible for Occupational Health and Safety K3 problems. In March 2017, the company undertook renewal P2K3 team headed by Mr. Parlinggoman and Secretary Ms. Irena Astra. Secretary General AK3 had got training and had received a letter of appointment from the Ministry of Labor per July 25, 2016. The P2K3 is submitted for approval by the Jambi provincial labor offices. Company apply for approval on March 02, 2017. Application is accepted by Manpower Agency Jambi province on March 3, 2017. P2K3 committee conduct meetings every month. Samples taken by auditor are meeting in January 2017. All progress in January 2017 has been implemented by Company. P2K3 conduct report activities for 3 months. Reporting samples taken are third and fourth quarter 2016. Evidence of Reporting such as acceptance of the report with signature and staple of Jambi Provincy Conclusion: conform 4.7.5 Accident and emergency procedures shall exist and instructions shall be clearly understood by all workers. Accident procedures shall be available in the appropriate language of the workforce. Assigned operatives trained in First Aid should be present in both field and other operations, and first aid equipment shall be available at worksites. Records of all accidents shall be kept and periodically reviewed. Minor The Company has established some procedures and work instructions related work accidents and emergencies. Procedures and work instructions applies to all units under PT. BBB. Here are some procedures SOPs and work instructions IK that has been made: Incident Investigation SOP, SOP First Aid, Emergency Response Plan SOP, SOP Medical Services, and Medical Flow chart. The Procedure available in the appropriate language of the workforce. The Company has P3K officers about 9 people. P3K officer has got training 5 - 7 September 2016 and got the license from the Ministry of Labor. P3K training for supervisors was implemented on July 26, 2016. The training was attended by the entire harvesting foreman, but there is no documented evidence of training followed by a whole foreman, for example foreman of afdeling H. This has been issued as observation no.4. Emergency Plan All units already has first aider who have been trained on September 05-06 2017, which was attended by 9 people and conducted by the Manpower agency.. SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 47of 124 First aid P3K box is already provided in each division or unit such as class A box that is in accordance with the Permenaker no. 15 in 2008. As for field foreman, they have provided a bag of P3K class A. In addition there are other facilities to support the emergency response preparedness such as 1 ambulance and the facilities and there is a paramedic who accompanied the patient. The Company already has a health clinic, where there are license of DHO Muaro with no. 44109 SIKP DHO 2016. Company’s doctor have designation as Hyperkes doctors from the Ministry of Labor Permenaker no. 01 of 1976. Doctors have training hyperkers 17 to 21 October 2016. The doctor has got the designation of manpower agency kep.34 BINWASK3-PNK3 KK II 2017 per February 27, 2017. The Company is already calculating the frequency rate FR and the severity rate SR from the scene of the accident were carried out during 2016. The calculation refers to the provision in Ministerial Regulation No. 03 MEN 1998, and already counting lost working days Lost Time Accident. Calculation results are recorded in Form SR FR Monthly. The guides and Procedure of filling FR Format – SR was also availabe. Emergency response equipments in estate were sufficient in locations such as a water tank. The location during visited to see implementation of the second surveillance audit on 13 to 17 March 2017 was section H block G5-G5A, Afdeling D block D12, and Afdeling C block C7. Conclusion: Observation No.4 4.7.6 All workers shall be provided with medical care, and covered by accident insurance. Minor The Company has not paid the premiums of health insurance BPJS kesehatan, retirement insurance and pensions for daily casual worker as seen in their paycheck month of December 2105 and January 2016 Conclusion: Conform 4.7.7 Occupational injuries shall be recorded using Lost Time Accident LTA metrics. Minor During the year 2016 up to now there was no occupational accident in factories as well as in the estate. It is advised to provide the sheet for routine checks on the ambulance readines. The company has been cooperating with the nearest referral hospital Hospital Ahmad Rifin Muaro Jambi. The Company has calculated the frequency rate FR and the severity rate SR from the accident during 2016. The calculation refers to the provision in Ministerial Regulation No. 03 MEN 1998, and already counting Lost Time Accident. Calculation results are recorded in the sheet of SR FR Monthly. There was guides Procedure Charging FR Format – SR. The company has calculated occupational injuries using Lost Time Accident LTA Metrics based on SK Dirjen Pembinaan Hub. Industri Pengawasan Ketenagakerjaan NoKep 84BW1998. Total SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 48of 124 of workingtime on January 2017 for all workers are 116,294. Conclusion: Conform 4.8 All staff, workers, smallholders and contractors are appropriately trained. 4.8.1 A formal training programme shall be in place that covers all aspects of the RSPO Principles and Criteria, and that includes regular assessments of training needs and documentation of the programme. Major The company has a training program on site. The training is reported monthly. The training that have been implemented include training for officers spraying, fertilizing, safety for transportation, socialization of use PPE, fire extinguisher. Training for farmers has been carried out between the months of October to December 2015 include harvesting, fertilizing, maintenance, weed control, OHS and HCV conservation. The Company has set a standard job descriptions and competency on the functions and positions respectively. Standards of competency have been defined in a matrix of competencies in order to get a gap for every function. Identification of training besides referring to the competence gap, the company also received a proposal from each division for the required training. Then the company created a training program. Internal training is set an Internal memo No. MI HC II 2016007. In the procedure of the provisions on employee training has accommodated assessment of effective training results by the direct supervisor for 6 months the form is available. To accommodate the training needs for the employees, the company already established training programs related to the environment, K3, ISPO and RSPO in 2016. One internal training in 2016 is SHE training and P2K3, and the flowchart accident report conducted in October 2016. One example of the external training in 2016 is P3K training which was held on 5 to 7 September 2016 from the Ministry of Labor. Related training in estate, it was training about pesticides and P3K on July 6, 2016 carried by the company doctor. Conclusion: conform 4.8.2 Records of training for each employee shall be maintained. Minor One of internal training in 2016 are SHE training and P2K3, Flowchart accident reports conducted in October 2016. One example of the external training in 2016 is P3K training which was held on 5 to 7 September 2016 from the Ministry of Labor. Related training in estate, one of them related to pesticides and P3K on July 6, 2016 by the company ’s doctor. Company keep documentation of training and the evaluation. Conclusion: conform SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 14.05 Issue 00 Rev. 1 49of 124 5 ENVIRONMENTAL RESPONSIBILITY AND CONSERVATION OF NATURAL RESOURCES AND BIODIVERSITY

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