We refer to the online report published by www.foresthints.news on 1 February 2019 containing satellite imagery as evidence of land clearing activities by PT SAE, a subsidiary of Saraswanti Group. We were made aware of this report at 16.00h (Kuala Lumpur time). In light of the evidence and the alleged activities which are in contravention to our own supply chain and sustainability commitments, at 18.00h on the same day (Kuala Lumpur time) the management of Sime Darby Plantation (SDP) has decided to suspend with immediate effect any future dealing with PT SAE mill and the Saraswanti Group.

SDP would like to clarify that Saraswanti Group entered our supply chain since July 2018 via a few spot purchases of Crude Palm Oil (in total of 2500 mt) and palm kernel (in total 1,350 mt). We do not have a standing purchase contract with the company.

We will initiate further investigation into the matter and engage with the supplier to determine what, if any, restitution can be done to reverse their actions. We will also explore their willingness to join other responsible growers and commit to protecting orangutans by adopting and implementing a No-Deforestation policy through the recognized High Carbon Stock Approach, as well as to stop all development on peat.

We would like to thank Forest Hints for alerting us on the situation through the publication of their online report. We welcome such vigilance by other concerned stakeholders to highlight similar issues. This approach assists us in our fight to abolishing deforestation, protecting orangutans and preventing further emissions from peat development.

SDP will continue to review our own internal processes to further strengthen our due diligence and prevent sourcing of unsustainable palm oil within our supply chain. We will continue to uphold our NDPE commitments as reflected in our Responsible Agriculture Charter.

Foresthints published a report dated 4th February 2019 (‘Palm Oil Supplier Continues to Disrespect Government Sanction’), which links the Pundi Lahan Khatulistiwa Group to Sime Darby Plantation (SDP).

We wish to clarify that this is inaccurate, and that the Pundi Lahan Khatulistiwa Group does not supply to SDP. For further details, please refer to our list of supplying mills as published on our website: https://www.sdguthrie.com/sustainability/open-palm-traceability....

SDP welcomes the efforts by Foresthints in helping to illuminate unacceptable practices within supply chains. We would also like to better understand how this inaccurate link has been made and would welcome any input from Foresthints on this.

On 12 February 2019, Sime Darby Plantation (SDP) was made aware of an online report entitled ‘Who is Still Tied to Indofood?’ by Rainforest Action Network (RAN) at 11.15pm(Kuala Lumpur time). The report tells the decision by the Company to withdraw its membership from the Roundtable on Sustainable Palm Oil (RSPO), and named SDP as one of its trading partners.

In light of this report and upon our further confirmation, the management of SDP has decided to suspend with immediate effect any future dealing with Indofood until further notice. We will initiate further investigation into the matter and engage the Company to determine what, if any, restitution can be done to reverse their actions. We will also explore their willingness to join other responsible growers and commit to protecting human rights by adopting a No-Exploitation policy.

SDP would like to clarify that we do not have a long term contract with Indofood. Following RSPO’s complaint in October 2016, we worked with a long term trading partner to exclude the Company from our supply chain in South Africa and succeeded in the second half of 2017. However, in 2018, the Company re-entered our European supply chain via two spot purchases of crude palm kernel oil. Combined, these two spot purchases made up only 1.5% of the total volume of raw materials processed for that refinery. Despite the small volumes involved, this highlights the complexity of addressing unsustainable palm oil supplies via intermittent spot trades, as well as, the shortcomings in our system to effectively manage this.

We would like to thank RAN for alerting us on this situation through the publication of their online report. We welcome such vigilance by other concerned stakeholders to highlight similar issues. This approach assists us in abolishing workers exploitation within our palm oil value chain.

SDP will continue to review our own internal processes to further strengthen our due diligence and prevent sourcing of unsustainable palm oil within our supply chain. We will continue to uphold our NDPE commitments as reflected in our Responsible Agriculture Charter.

Kuala Lumpur, 28 February 2019 – For the six-month financial period ended 31 December 2018 (FP 2018), Sime Darby Plantation (SD Plantation) Group registered a PBT of RM457 million, on the back of weak average crude palm oil (CPO) and palm kernel (PK) prices realised mitigated by continued earnings improvement from its Downstream operations. PBT declined by 76 percent compared to the corresponding period of the previous year, wholly attributable to the sharp decline in the average CPO and PK realised prices. The average CPO price realised declined by 26 percent year-on-year (YoY) from RM2,672 per MT to RM1,974 per MT whilst the average PK price realised was lower by 38 percent YoY from RM2,374 per MT to RM1,479 per MT. The adverse price impact was partially mitigated by a 2 percent YoY rise in fresh fruit bunch (FFB) production, improved oil extraction rate (OER) from 20.96 percent to 21.17 percent as well as lower costs.

The Group reported a net profit for the FP 2018 of RM244 million, comprising a recurring net profit of RM230 million and a non-recurring net profit of RM14 million. In comparison with the net profit for the corresponding period in the previous year of RM1,448 million, the decline was largely due to the non-recurring net profit of RM749 million recorded in the previous year related to the gain on sale of land to a related company and a one-off writeback of donation to Yayasan Sime Darby.

For the quarter ended 31 December 2018, the Group’s PBT and net profit declined to RM245 million and RM129 million respectively, whilst the Group’s PBIT fell to RM300 million as compared to RM673 million recorded in the corresponding quarter of the previous year. The 55 percent YoY decline in PBIT was attributable to lower profits from the Upstream segment arising from lower average CPO and PK prices realised, which declined by 30 percent YoY and 49 percent YoY respectively. This was compensated by an increase in FFB production and OER, as well as an improvement in earnings by the Downstream operations in the quarter under review.

“This financial period continued to present a challenging environment for the Group’s operations. Despite an overall increase in our FFB production and OER, the palm oil industry continued to weather prevailing low CPO and PK prices, arising from the pressures on the United States-China trade war, as well as the relentless negative sentiment on palm oil from Europe,” said Tan Sri Dato’ Seri Mohd Bakke Salleh, SD Plantation’s Executive Deputy Chairman and Managing Director.

“On a brighter note, the industry is off to a reasonable start in 2019 with inventories declining on the back of the seasonal low production cycle and the reduction of India’s import duties on palm oil, resulting in CPO prices rebounding. This augurs well for SD Plantation’s performance moving forward, as the Group continues to drive operational efficiency through productivity enhancements and cost rationalisation. SD Plantation’s diversified Upstream operations across different territories will also continue to complement each other in driving our overall FFB productivity and OER performance, as can be seen during this quarter ended 31 December 2018,” added Mohd Bakke.

“SD Plantation is also encouraged by the performance of our Downstream operations and we are fortunate that our international reach has allowed the business to fare well in this current environment. We are optimistic that new developments to our Downstream business, which will be announced very soon, will take it to even greater heights,” he added.

In view of the various recognitions awarded to the Company recently in the sphere of sustainability, Mohd Bakke reaffirmed that SD Plantation’s sustainability agenda will always remain at the forefront of the company’s operations. The Company recently won five awards at the inaugural Sustainable Business Awards Malaysia 2018. This achievement, according to Mohd Bakke, is a testament to the Group’s commitment in pursuing the Sustainable Development Goals.

“As declared in our Responsible Agriculture Charter (RAC), SD Plantation will continue to uphold our No Deforestation, No Peat, No Exploitation (NDPE) commitments. We will continuously review our internal processes and strengthen our due diligence to ensure that we only source from suppliers which adhere to our Responsible Sourcing Guidelines (RSG),” he added.

Three Months Ended 31 December 2018 versus Three Months Ended 31 December 2017 (YoY Comparison)

Upstream Operations

In the quarter ended 31 December 2018, Upstream operations reported a recurring PBIT of RM185 million in comparison with RM577 million reported in the corresponding quarter last year. The weaker performance was largely due to lower average CPO and PK prices realised. Average CPO price realised declined by 30 percent from RM2,654 per MT to RM1,870 per MT, whereas average PK price realised declined by 49 percent from RM2,624 per MT to RM1,338 per MT in the quarter under review. However, the Group’s FFB production increased by 2 percent in the current quarter from 2.76 million MT to 2.81 million MT. Furthermore, OER also improved YoY from 21.00 percent to 21.28 percent.

For the quarter under review, Upstream Malaysia registered a recurring PBIT of RM176 million, representing a decrease of 57 percent YoY from RM414 million in the corresponding quarter last year. The weaker performance was largely due to the lower average CPO and PK prices realised. Average CPO price realised for the quarter under review declined by 28 percent YoY from RM2,706 per MT to RM1,939 per MT, whereas average PK price realised declined by 47 percent YoY from RM2,694 per MT to RM1,434 per MT. FFB production in Malaysia stood at 1.51 million MT this quarter versus 1.69 million MT in the corresponding quarter of the previous year. This represents an 11 percent YoY decline, which was attributable to the bumper harvest experienced in the same quarter last year. Nevertheless, OER increased YoY from 20.21 percent to 20.68 percent as a result of crop quality improvements with better agriculture management.

Recurring PBIT of Upstream Indonesia decreased by 97 percent from RM144 million to RM5 million this quarter, primarily due to the significantly lower average CPO and PK prices realised, which declined by 34 percent YoY from RM2,533 per MT to RM1,663 per MT and 51 percent YoY from RM2,344 per MT to RM1,140 per MT, respectively. The prices were driven to below global market prices due to the bumper crop and high inventory levels in Indonesia. OER for the three-month period ended 31 December 2018 stood at 21.24 percent as compared to 21.87 percent in the same quarter last year. The YoY decline was due to crop quality being affected by heavy rainfall in certain areas in the Kalimantan region. However, this was partially mitigated by the higher FFB production, which increased by 12 percent from 0.71 million MT in the same quarter last year to 0.79 million MT this quarter, driven by our continuous operational improvements such as fertiliser application, water management and other agricultural management practices.

Upstream Papua New Guinea (PNG) and Solomon Islands (SI) reported a lower recurring PBIT of RM27 million in the quarter under review against RM39 million in the previous year corresponding quarter. The decline in profit was attributable to the weaker average CPO price realised which had declined by 21 percent YoY from RM2,713 per MT to RM2,155 per MT this quarter. Nevertheless, its earnings were supported by higher FFB production which improved by 41 percent from 0.34 million MT to 0.48 million MT as it recovers from a low harvest in the corresponding quarter last year. OER also improved from 22.71 percent to 22.95 percent this quarter, resulting from our continuous crop quality improvement initiatives.

Upstream Liberia registered a higher loss before interest and tax of RM23 million this quarter versus a loss of RM20 million in the same quarter last year as a result of lower average CPO and PK prices realised, which was partially mitigated by an increase in FFB production by 73 percent YoY from 0.02 million MT to 0.03 Million MT.

Downstream Operations

For the quarter under review, Downstream operations reported a recurring profit of RM98 million as compared to RM64 million in the previous year corresponding quarter, representing an increase of 53 percent YoY. Both bulk and differentiated products businesses, particularly for the operations in Asia Pacific, have registered better performance mainly due to higher sales volume and better margins. This compensated the lower profit contribution from the differentiated products businesses in Europe, Middle East and Africa, which were impacted by lower demand.

Other Operations

Other operations registered a recurring PBIT of RM3 million in the current quarter compared to RM32 million in the previous year corresponding quarter. The decline in profits was largely due to the recognition of a one-off dividend income of RM39 million from an investment in the same quarter of the previous year.

Dividend

A final single tier dividend of 1.7 sen per share in respect of the financial period ended 31 December 2018 has been approved by the Board and will be paid on 21 May 2019.

Sime Darby Plantation Berhad (SDP) would like to confirm that an announcement on the intention of PT Inti Nusa Sejahtera (PT INS) to acquire 100% interest in PT Mitra Austral Sejahtera (PT MAS) was published in a local Indonesian media publication on 26 February 2019. This announcement was made in compliance with the provisions of prevailing Company Law in Indonesia.

The decision to sell-off the stake in PT MAS has been made by our Board of Directors after careful deliberation of all pertinent matters and in the best interest of SDP shareholders. It is driven mainly by the poor financial performance of the asset. Since it was established within SDP in 1996, PT MAS has accumulated losses totalling over RM300 million (Rp 1,070,000,000,000) as at December 2018. Our Board has concluded that this poor financial performance is no longer tenable. This decision also aligns with the Group’s current strategy of reviewing our investment in non-performing assets.

SDP has been making diligent efforts and investments, not just in developing our operations but also in contributing to the socio-economic development of PT MAS's surrounding communities. Over the years, the company faced many challenges, but at the same time, significant progress were also made in resolving disputes with the local communities. However, it is now important for all stakeholders to concede that the main aim of the communities with regards to their rights can only be obtained with the involvement and agreement of the authorities. SDP can only help to facilitate but we are not able to go beyond what has been provided by the terms and conditions of our Right to Cultivate License (HGU) which had been granted by the government.

In view of this, we believe the new owner of PT MAS, which is a locally-owned Indonesian company, will be able to continue assist the communities to further their interest. The sale which includes a list of condition precedent (CP) will pave the way towards a future that will be more beneficial for the local economy and surrounding local communities and as such, we truly hope this transaction, once completed, would augur well for the mutual interest of all PT MAS’s stakeholders.

The full announcement on the details of this transaction will be made by SDP upon its completion, in compliance with Bursa Malaysia requirements.

Kuala Lumpur, 31 May 2019 – For the first quarter of its financial year ending 31 December 2019 (Q1 FY2019), Sime Darby Plantation (SD Plantation) Group recorded a profit before tax (PBT) of RM125 million, 64 percent lower compared to the corresponding quarter of the previous year (Quarter ended 31 March 2018). The lower PBT was attributable to the sharp decline in the average crude palm oil (CPO) and palm kernel (PK) realised prices year-on-year (YoY) and higher finance costs, partially mitigated by higher fresh fruit bunch (FFB) production and improved oil extraction rate (OER), as well as continued earnings improvement from Sime Darby Oils, the rebranded Downstream segment of the Group. The average CPO price realised declined by 18 percent YoY from RM2,452 per MT to RM2,012 per MT whilst the average PK price realised was lower by 43 percent YoY from RM2,094 per MT to RM1,204 per MT. The Group also benefited from an 8 percent YoY rise in FFB production and a higher OER from 21.03 percent to 21.41 percent, but these improvements were not sufficient to compensate for the adverse price impact.

For the quarter under review, the Group registered a net profit of RM74 million compared to RM249 million in the corresponding quarter of the previous year. The decline was due to the reduction in PBT as indicated above and a one-off net gain of RM26 million registered in the corresponding quarter of the previous year.

“The challenging business environment for the palm oil industry with prevailing low CPO and PK prices, as well as a volatile external environment influenced by the US-China trade war has continued to impact the industry’s performance.

We remain encouraged by higher FFB production and OER recorded from our Upstream segment as well as continuing profitability of Sime Darby Oils during the quarter under review. We believe the decision to rebrand our Downstream business would augur well with our strategy for a more balanced profit contribution from our Upstream and Downstream segments, moving forward,” said Tan Sri Dato’ Seri Mohd Bakke Salleh, SD Plantation’s Executive Deputy Chairman and Managing Director.

External factors including the negative perception on the palm oil industry due to deforestation have inevitably played a role in the decline of global CPO prices. As the leading producer of sustainable palm oil, SD Plantation shares the concern that the rapid rate of deforestation has become an urgent challenge that calls for a meaningful response from various stakeholders. To address this issue and ensure the industry’s long-term prospects, SD Plantation introduced a pioneering initiative called ‘Crosscheck’ on 23 May 2019.

“We believe that traceability is the next frontier in halting deforestation and ‘Crosscheck’’ is a major step forward for the Company towards a deforestation-free supply chain. This open access online tool enables traceability across our supply chain down to the mill level, making it possible for everyone to identify where problems may exist, so that action can be taken,” said Mohd Bakke.

SD Plantation has also been ranked first among 250 listed companies across South East Asia in the recent ‘Human Rights Disclosure in ASEAN’ study conducted by ASEAN CSR Network, the Institute of Human Rights and Peace Studies, Mahidol University and Article 30.

“The honour came as a testament to the great strides we have made to act beyond compliance with our human rights commitments, due diligence efforts, risk management and overall corrective actions. I am truly proud of our people who embody the culture of good governance and transparency, and hope to see further development in this area in the future,” added Mohd Bakke Salleh.

First Quarter Ended 31 March 2019 versus Quarter Ended 31 March 2018 (YoY Comparison)

Sime Darby Plantation changed its financial year end from 30 June to 31 December with effect from 1 July 2018. Due to the change in the financial year, the performance of the current quarter ended 31 March 2019 (Q1 FY2019) is not comparable with the first quarter of the previous financial year ended 30 June 2018, instead the performance is comparable against the quarter ended 31 March 2018 i.e. the corresponding quarter of the previous year.

Upstream Operations

In Q1 FY2019, Upstream operations posted a recurring profit before interest and tax (PBIT) of RM83 million versus RM283 million in the corresponding quarter of the previous year due to the 18 percent and 43 percent YoY decline in average CPO and PK prices realised, respectively. Nonetheless, the Group’s FFB production improved by 8 percent in the current quarter from 2.34 million MT to 2.52 million MT, while OER also increased YoY from 21.03 percent to 21.41 percent.

Upstream Malaysia registered a recurring PBIT of RM113 million in comparison with RM253 million in the corresponding quarter of the previous year. The weaker performance was mainly due to the lower average CPO and PK prices realised, which was partially compensated by the higher FFB production and OER. Average CPO price realised in Q1 FY2019 declined by 19 percent YoY from RM2,480 per MT to RM1,998 per MT, whereas average PK price realised declined by 38 percent YoY from RM2,145 per MT to RM1,322 per MT. FFB production in Malaysia stood at 1.40 million MT this quarter versus 1.37 million MT in the corresponding quarter of the previous year. The 2 percent YoY increase was attributable to a higher percentage of trees moving into prime maturity, resulting in an increase in productivity. OER was also higher YoY from 20.48 percent to 21.09 percent due to more efficient crop evacuation on the back of favourable weather conditions.

Upstream Indonesia reported a lower recurring PBIT of RM9 million as compared to RM11 million in the corresponding quarter of the previous year primarily due to the significantly lower average CPO and PK prices realised, which declined by 12 percent YoY from RM2,270 per MT to RM2,002 per MT, and 47 percent YoY from RM1,861 per MT to RM994 per MT, respectively. Nevertheless, its earnings were supported by the 14 percent YoY higher FFB production of 0.60 million MT this quarter versus 0.52 million MT in the same quarter last year, driven by more area coming into maturity as a result of the accelerated replanting activities carried out in the preceding years. OER for the quarter stood 1 percent higher YoY at 21.98 percent compared to 21.79 percent in the corresponding quarter as a result of crop quality improvements with better agriculture management.

Upstream Papua New Guinea (PNG) and Solomon Islands (SI) registered a loss before interest and tax of RM19 million in the quarter under review against a PBIT of RM38 million in the corresponding quarter of the previous year. The decline in profit was attributable to the weaker average CPO price realised which had declined by 22 percent YoY from RM2,644 per MT to RM2,063 per MT this quarter. OER for the quarter was also lower at 21.52 percent from 22.00 percent in the corresponding quarter as a result of the rainy season experienced in West New Britain. Nevertheless, FFB production improved by 17 percent YoY from 0.44 million MT to 0.51 million MT.

Upstream Liberia reported a loss before interest and tax of RM20 million this quarter versus a loss of RM19 million in the same quarter last year as a result of YoY decline in the average CPO and PK prices realised at 5 percent and 71 percent, respectively. However, FFB production was 33 percent higher YoY at 0.02 million MT from 0.01 million MT in the corresponding quarter of the previous year. OER was also higher at 21.63 percent versus 18.12 percent in the same quarter last year.

Sime Darby Oils

For the quarter under review, Sime Darby Oils posted a recurring PBIT of RM85 million as compared to RM65 million in the corresponding quarter of the previous year, representing an increase of 31 percent YoY, attributable to better earnings from bulk products, differentiated products and trading operations. The improved performance from the bulk business was due to higher sales volume and better margins driven by favourable import duties in India as well as zero export levies in Indonesia since December 2018. Differentiated products in Asia Pacific registered higher margins this quarter, compensating for the weaker contribution from the differentiated segment in Europe, Middle East and Africa.

Other Operations

Other operations registered a recurring PBIT of RM12 million in the current quarter compared to RM14 million in the corresponding quarter of the previous year. Despite better results reported by associates and joint ventures in the current quarter, PBIT was still higher in the corresponding quarter of the previous year due to the one-off dividend income from an investment.

The European Palm Oil Alliance (EPOA), together with other industry associations, stakeholder companies, and civil society bodies, today issued a joint call to action for all European stakeholders to actively support the Sustainable Palm Oil Choice initiative. The appeal was made at the Sustainable Palm Oil Dialogue event in Utrecht, the Netherlands. Current participants include Agropalma; Cargill; Sime Darby Plantation; Fedepalma; FONAP (Forum Nachhaltiges Palmöl); the Italian Union for Sustainable Palm Oil; Lipidos SA; Nutella; Olenex; Orangutan Land Trust (OLT); Palma Organica; Solidaridad; Robeco and the Spanish Foundation for sustainable Palm oil.

The Sustainable Palm Oil Choice initiative’s objective is to drive the uptake of Certified Sustainable Palm Oil (CSPO) by all stakeholders in Europe’s food manufacturing value chain. The goal is for all manufacturers and retailers to choose and use only CSPO in their production and to achieve the target of 100% CSPO in European food manufacturing by 2020.

Acceptance and adoption of sustainable palm oil faces challenges at both ends of the manufacturing sector. Because of palm oil’s negative market image with consumers, it can prove difficult to engage smaller companies to embrace CSPO. At the same time some of the bigger companies that are already fully certified are starting to move away from palm oil altogether. Michelle Desilets, Executive Director of the Orangutan Land Trust explained why this is such a problem.

“Our supporters have been confused by messages in the public domain, such as from some UK retailers, that a blanket boycott of palm oil is desirable – a position we categorically do not share. Palm oil doesn’t have to result in deforestation or biodiversity loss, and by demanding responsible palm oil, we can help ensure that it doesn’t. As someone who has been working as conservationist for over 25 years with a specific focus on protecting orangutans where they are found, I am personally committed to supporting and promoting 100% sustainable palm oil in Europe.”

The Sustainable Palm Oil Choice initiative seeks to reverse this and increase market acceptance for CSPO by engaging stakeholders who are already committed to it to speak up for CSPO and inspire others not only to choose and use it, but also to advocate for it. Manufacturers, NGOs and producers are being particularly targeted, as they have a key role to play as catalysts helping to drive change within their respective spheres.

Commenting on the call to action, Frans Claassen, EPOA’s Chair, said:

“We have to empower companies, retailers and consumers to choose sustainable palm oil. I believe we will achieve this by telling honest stories about the impact of sustainable production on the ground. What is your story? As a part of this initiative EPOA has launched a campaign platform that will showcase explanatory videos, participants’ testimonials, examples and best practices. These stories explain why people believe in CSPO and allows companies and NGOs to speak up. The platform will also include a progress reporting tool in the shape of an interactive map of Europe with the latest monitoring data for individual countries as well as showing progress in palm-oil producing countries.”

Making the choice for sustainable palm oil across Europe helps safeguard rainforests and their biodiversity across the world. Choosing palm oil that is produced sustainably also protects smallholders, uplifts their earning potential, and helps create fair and socioeconomic conditions for growers and workers active across the global palm oil supply chain. Companies and organisations wishing to join the Sustainable Palm Oil Choice initiative can do so at sustainablepalmoilchoice.eu. View video about the certified sustainable palm oil choice here. View video about EPOA here.

Issued by Group Communications, Sime Darby Plantation Berhad

Cargill, Golden-Agri-Reources, Musim Mas, Sime Darby Plantation and Wilmar announce two new pilots as part of the ‘Decent Rural Living Initiative’ convened by Forum for the Future

Five industry leaders have today announced two new collaborative pilot projects set to tackle labour rights challenges in Indonesia’s palm oil sector, by developing much-needed improvements in working conditions.

Cargill, Golden-Agri-Resources, Musim Mas, Sime Darby Plantation and Wilmar have united as part of the Decent Rural Living Initiative (DRLI), convened by international sustainability non-profit, Forum for the Future. Formed in early 2018, DRLI is a unique pre-competitive collaboration which aims, long-term, to help ensure the sustainability of the palm oil sector.

As a key ingredient in both food and non-food products, palm oil is well-recognised as the world’s most widely used vegetable oil with the industry employing over 5.7 million people in Indonesia alone. Combined with Malaysia, the two countries supply 85%* of palm oil used globally, yet significant and pressing challenges throughout the sector – from excessive pesticide use, to rights infringements - continue to threaten and undermine its sustainability.

“Following a stakeholder consultation process with Indonesian civil society, industry bodies and inter-governmental organisations, DRLI partners identified two strategic areas for pre- competitive collaboration’, said Ariel Muller, Managing Director, APAC at Forum for the Future. ‘With a commitment to addressing root causes, harnessing rural workers’ potential as agents of change and sharing lessons learned across the value chain, these companies have the potential to catalyse systemic change.”

Dr Simon Lord, Chief Sustainability Officer, Sime Darby Plantation, added: “We often say that we cannot do it alone. With increasing scrutiny on the complex human rights challenges faced within our industry, a multi-stakeholder approach such as the Decent Rural Living Initiative is the way forward to create a meaningful and permanent systemic change. Now that we are starting to put collective action in place, it is important for other players in the supply chain to also come on board, providing insights as well as support to strengthen this initiative and bring positive impact to the sector. Together, we will achieve more than just the sum of our individual actions.”

The first of the two pilots will launch in West Kalimantan. It will focus on developing contracts that minimise the precariousness of casual and flexible work - thereby improving conditions and allowing greater choices for casual workers. This is particularly significant for women, who disproportionately count among this segment of the industry’s workforce.

Ms Perpetua George, Wilmar's General Manager for Group Sustainability, said: “The pilot entails extensive engagement efforts with workers, workers’ unions and the private sector in what would be a constructive and beneficial Public Private Partnership. We hope this effort will be a model for others to adopt. We also welcome more participation and collaboration from like-minded palm oil industry players to help improve and strengthen the working conditions and rights of workers in the industry.”

The second pilot area aims to create a more gender-balanced palm oil industry by strengthening the role of gender committees on estates.

Commenting on the pilot, Ms Anita Neville, Senior Vice President of Golden Agri Resources’ Group Corporate Communications, said: “Golden Agri Resources recognises the importance of the role of women in rural agriculture - especially as agents to help address the challenges agriculture faces. To help them realise their change agent potential we need to create safer, more inclusive workplaces, and believe enhancing the role and function of gender committees across our business and the wider industry is an essential first step.”

Today’s announcement follows a consultation process throughout 2018 to identify specific areas where industry-level collaboration could focus to create lasting, impactful change. Key findings and practices developed through the pilots will be scaled up and shared with the wider industry later this year.

Dr Gan Lian Tiong, Director, Musim Mas, said: “We believe that, to achieve the vision of realising a credible palm oil supply chain, we have to ensure that our solutions also cater for, and encompass smallholders’ needs. We are hopeful that the Decent Rural Living Initiative’s pre-competitive approach and pilots would eventually be scaled up to include smallholders, and go towards supporting them in adopting sustainable agricultural practices in the long run."

“From safety to healthcare to education, Cargill’s palm oil plantations work to enrich the communities we operate in,” added Richard Low, CEO of Cargill Tropical Palm Holdings. “We are excited about the Decent Rural Living Initiative because of its potential to make meaningful improvements to the lives of those who work across the agriculture sector, regardless of their gender.”

*European Palm Oil Alliance https://www.palmoilandfood.eu/en/what-is-palm-oil

For more information, interviews or comments, please email:

Karen Sim,
k.sim@forumforthefuture.org

Amy Langridge,
A.Langridge@forumforthefuture.org

About Forum for the Future
Forum for the Future is a leading international sustainability non-profit with offices in London, New York, Singapore and Mumbai. We specialize in addressing critical global challenges by catalysing change in key systems.

For over 20 years, we’ve been working in partnership with business, governments and civil society to accelerate the shift toward a sustainable future. Together we are reinventing the way the world works.

Find out more at www.forumforthefuture.org or by following @Forum4theFuture on Twitter

Singapore, 03 July 2019 - Moody's Investors Service has affirmed the Baa1 issuer rating of Sime Darby Plantation Berhad (SDP).

At the same time, Moody's has affirmed the (P)Baa1 rating on the $1.5 billion senior unsecured medium-term note programme of its wholly owned subsidiary, Sime Darby Global Berhad and the Baa1 senior unsecured debt rating on the sukuk issued by Sime Darby Global Berhad.

The outlook is maintained at stable.

RATINGS RATIONALE

"While weak palm oil prices have reduced SDP's earnings, we expect the company will maintain its credit profile through substantial debt reduction using the proceeds from its planned MYR1.0 billion asset sales this year," says Maisam Hasnain, a Moody's Analyst.

Click here to read the full release.

From Left: Mr. Asanee Mallamphut, Head Asia Pacific- Customised, Sime Darby Oils, Mr. Mohd Haris Mohd Arshad, Managing Director, Sime Darby Oils, Dr. B.R. Shetty, Chairman, ADVOC, Mr. Binay Shetty, Vice-Chairman & CEO BRS Ventures, Mr. Nirman Shetty, Director ADVOC.

Abu Dhabi & Kuala Lumpur, 19 August 2019 – Sime Darby Oils (SDO) and Dr. B.R.Shetty owned Abu Dhabi Vegetable Oil Company (ADVOC), are pleased to announce they have entered into a strategic partnership to market oils and fats products in the Middle East and North Africa (MENA) region.

Via the partnership, SDO and ADVOC will operate in the region as a single sales and marketing team, focusing on basic and specialty fats (including bakery fats, shortening, industrial margarines, spread fats, dairy replacers, confectionary fats and cocoa butter substitutes and replacers). This will benefit regional customers by providing them access to the companies’ combined sales expertise, production capabilities and extensive product range.

With evolving customer needs playing an increasingly critical role in businesses, companies recognise they need to accelerate the development of innovative solutions to ensure they remain competitive. In view of this, Sime Darby Oils-ADVOC partnership aspires to help support customers in the MENA region through bespoke solutions using the combined skills and understanding in the oils and fats category, product ideation, development and deployment.

“The Sime Darby Oils-ADVOC partnership is a powerful combination. Sime Darby Oils’ understanding of specialty fats, its deep R&D expertise, and agile, collaborative approach is uniquely complimentary to that of ADVOC’s. Over the last two decades, ADVOC has earned the reputation of being a customer driven and reliable supplier of a wide variety of oils and fats in the MENA region” said Dr. B.R.Shetty, Chairman, ADVOC.

“The MENA region is a key growth market for Sime Darby Oils. Partnering with ADVOC enables us to establish an on-the-ground presence through enhanced local market knowledge and capabilities, and open up opportunities for sustainable products and supply chain. Through this partnership we can leverage our respective assets to offer compelling customer propositions,” said Mohd Haris Mohd Arshad, SDO's Managing Director.

“The teams are working closely to set up the operations, structure, portfolio, marketing and route-to-consumer strategies, licensing and other operational matters. Together, working as one team, we will unlock the full potential of global expertise and local requirements, and place our clients on the best path for success” said Nirman Shetty, Director ADVOC.

By connecting ADVOC’s local market understanding with SDO’s extensive oils and fats know-how and expertise, the collaboration represents a step-change in the way both entities address the needs of the market.