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Malaysia‘s responses to Allegations of Forced Labour in Palm Oil Ban

Malaysia‘s responses to Allegations of Forced Labour in Palm Oil Ban
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By Charles F Moreira, Editor

Following up on our article US Palm Oil Ban: Why Are MAFI and MITI Silent? of 15 June 2021, we could not find media statements on the Ministry of Plantation Industries and Commodities’ website about the U.S. Customs and Border Protection’s (CBP) Withhold Release Order on 30 December 2020 to detain at U.S. ports, palm oil and products containing palm oil produced by Sime Darby Plantation Berhad (SDP) and its subsidiaries, joint ventures, and affiliated entities in Malaysia.

However, The EDGE Markets the following day cited Datuk Dr Mohd Khairuddin Aman Razali, Minister of Plantation Industries and Commodities as saying that his ministry does not agree with the way the US government imposed the detention order on palm oil produced by SDP over allegations of forced labour.

The minister acknowledged that the CBP has the right to issue a WRO against SDP’s at all US ports of entry but his ministry does not agree with the way the CBP went about it as SDP was not given was not given a chance to defend itself against the claims made, and that his Ministry is confident that SDP will reject the allegations of violations made against the company by the CBP.

Further down the article, the Minister said, “The ministry acknowledges that there has been an issue of forced labour and child labour in the national oil palm plantation sector. However, these are isolated cases based on a study done in 2018.”

“We rely on independent auditors to detect violations of this nature and to date, no non-conformances have been identified on any certified Sime Darby Plantation plantations. We have launched an immediate investigation into these new violations cited by the CBP and we would appreciate any specifics that they or their investigators can share beyond the generic information in the media”, he added.

SDP responds. In a press release on 31 December 2020, SDP wrote:-

“Sime Darby Plantation Berhad (SDP) refers to the Withhold Release Order issued by the U.S. Customs and Border Protection (CBP) on 30 December 2020.”

“We are currently reviewing the CBP’s news release in order to better understand the potential impact, if any, of the Withhold Release Order.

“The CBP’s news release does not provide sufficient information to allow SDP to meaningfully address the allegations that triggered the issuance of the Withhold Release Order. Nevertheless, we look forward to receiving pertinent information and working with CBP in order to address their concerns and quickly resolve this matter.

“SDP will also continue to engage with Liberty Shared (LS) and other organisations to obtain information regarding the initial complaint that would enable us to take any appropriate corrective actions as required.

“SDP is committed to combating forced labour and has implemented robust policies to protect worker’s rights. These efforts include the appointment of PricewaterhouseCoopers Consulting Associates on 19 October 2020 to assist us in our continuous improvement commitment. Our engagements with multiple stakeholders have commenced ever since SDP became aware of the petition submitted by LS to the CBP back in July 2020, and have continued regularly with SDP updating stakeholders on all measures taken internally to address any gaps and potential areas of concern as identified by our own internal audit processes”, the company added.

In an earlier press release on 3 December 2020, SDP responded to an Associated Press (AP) article dated 18 November 2020 and SDP’s response the following day:-

“Sime Darby Plantation Berhad (SDP) refers to the news article in the Associated Press published on 18 November 2020 relating to our operations, and our response dated 19 November 2020.”

“As an organisation that upholds and observes the highest ethical standards, particularly in relation to the welfare of our employees, we were deeply concerned by the allegations made. SDP implemented its first Gender Policy in 2012 and has, over time, enhanced our practices, ensuring that every estate has an active Gender Committee and grievance channels in place, which all our female workforce is familiar with. Awareness programmes on the rights of women, especially to a safe workplace, are conducted regularly, well documented and executed with the assistance of external experts and civil society organisations.

“The following links provide the information on SDP’s related initiatives in this area:

“Sustainability Report”

“Reducing Inequalities”

“Women and Children’s Rights Take Centre Stage”

“Due to the specific nature of the information in the article, we were able to immediately identify the particular case and revisit it, even though the complainant had withdrawn her complaint in April 2019, two months after it was first brought to light. At the time, the complainant had insisted that she was in no way coerced or intimidated into withdrawing her complaint, and that she was acting voluntarily, while being given our assurance that we would protect her and safeguard her rights. As the complainant was steadfast about withdrawing the complaint, the Company had accordingly closed the matter as there were no other witnesses to the alleged act. We had also then informed the independent non- governmental organisation (NGO) assisting the complainant of her decision. The NGO in question acknowledged the decision to close the case.

“In revisiting the matter, the complainant informed our Gender Committee representative that she had no intention of reopening the case and also denied that the offensive statements had been made to her in the first place. Another female colleague identified as the actual target of the alleged statement, has denied that she had heard the statement, if it had been made at all. Thus, without any evidence, witnesses or even a victim, we have no basis to pursue further investigations and have accordingly closed the case again.

“Both individuals continue to work in our estates as employees, under the protection of the systems that we have in place. We have taken this opportunity to reinforce the many safeguards, processes and procedures that are in place for our female workforce, and to educate all employees of the appropriate conduct expected of them at all times.”, SDP added.

In response to AP’s article on 18 November 2020, SDP responded the following day reiterating its zero tolerance for any forms of sexual or human rights violations, exploitation or any other criminal offences in our operations and supply chains.

“We are committed to strictly abide by our robust governance framework as well as our comprehensive list of policies, guidelines, control measures and procedures, all of which have been put in place to protect the fundamental rights of workers, regardless of gender or ethnicities. The full list is publicly available on our website: www.simedarbyplantation.com

“SDP views with serious concerns the allegation in the AP article that relates to our operations. If true, the allegation describes behaviour that is in contravention of national laws, as well as our own policies, procedures and guidelines. SDP has commenced further internal investigations over the allegation and will take all necessary actions, if there is any evidence of unlawful or unethical behaviour, or any breaches of our own policies and guidelines.

“Furthermore, we will continue to secure the safety and well-being of the more vulnerable members of our workforce. In the past we have addressed such complaints and allegations as and when they have arisen, with respect and sensitivity, according to the best international standards. We have also ensured that the Gender Committees, which are established in all our estates, are empowered and engaged with our female workforce and that they are enabled to work closely with independent third parties such as non-governmental organisations.” SDP added.

Meanwhile in a press release on 18 January 2021, the Ministry of Plantation Industries and Commodities with the cooperation of the Attorney General’s Chambers and the Ministry of International Trade and Industries on 15 January 2021, had initiated a legal action against the European Union (EU) and its member states France and Lithuania following their anti-palm oil campaign. Malaysia has filed a request for consultations under the World Trade Organisation’s (WTO) Dispute Settlement Mechanism (DSM).

And, on 26 May 2021, the Ministry expressed its support for the Council of Palm Oil Producing Countries’ (CPOPC’s) objection against Belgium’s banning of the use of palm oil as a biofuel.

In a press release on 27 May 2021, the CPOPC wrote:-

“The Council of Palm Oil Producing Countries (CPOPC) expressed its disappointment over the notification of the Kingdom of Belgium to the European Commission which proposed a ban on palm oil as a renewable source of biofuel in the near future.”

“The CPOPC, which comprises of Indonesia and Malaysia, and soon of the countries of Colombia, Ghana, Honduras and Papua New Guinea, reminded Belgium of the key economic and social development role that the palm oil plays in the development of these countries and in meeting the UN SDGs,” the CPOPC wrote.

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