Blogs: Supply Chain

Sustainability within our supply chain is a shared commitment – our suppliers help us achieve our sustainability goals, and we help them drive sustainability into their processes and practices. We are aiming to raise the floor across the palm oil industry by sharing experience, knowledge and expertise through training and technical assistance to ensure our people have the right skills and motivation to deliver our plans.

GAR recently organised a workshop in Medan for more than 150 senior representatives from 80 companies. Companies such as Bumitama, Pasifik Agro, Asian Agri and PTPN discussed key learnings and opportunities for collaboration with GAR as they continuously improve sustainability practices in line with GAR’s Environmental and Social Policy (GSEP) when they supply Crude Palm Oil (CPO) and Palm Kernels (PK) to GAR’s processing facilities in Indonesia.

The programme was officiated by Bayu Krisnamurthi, President Director of Indonesia Estate-Crop Fund for Palm Oil (BPDP) and Agus Purnomo, GAR’s Managing Director for Sustainability and Strategic Stakeholder Engagement. Speakers in the workshop included Irwan Gunawan, Deputy Director Market Transformation of WWF Indonesia, Mansuetus Darto of Indonesia’s Palm Oil Smallholders Union, Adrian Suharto of Neste Oil and Nofri Iswandi of The Forest Trust.

Bayu Krisnamurthi, President Director of Indonesia Estate-Crop Fund for Palm Oil (BPDP) receiving a token of appreciation from Agus Purnomo, GAR’s Managing Director for Sustainability and Strategic Stakeholder Engagement

Supplier engagement and capacity building forms an integral part of the GSEP roadmap which is collectively shared by the company’s employees and supply partners. It is a journey that requires continuous improvements in social, environmental, industrial relations, trading and supply chain practices.

GAR developed and introduced a new tool to the workshop participants, called GAR Supplier Self-Assessment that helps the company’s supply partners to make a fair assessment of their own improvement areas. This tool will assist GAR in identifying areas where the company’s suppliers need support.

At the end of the workshop, participants are expected to understand GSEP implementation, how to use the self-assessment tool by themselves and other support programmes available from GAR.

In February, GAR announced it had completed mapping its supply chain to the mill, and now knows the location and other relevant details of all the 489 mills which supply Crude Palm Oil (CPO) and Palm Kernels (PK) to its processing facilities in eight different locations in Indonesia. As Daniel Prakasa, Head of Downstream Sustainability Implementation, points out, this is just the start of a process of continuous engagement with our suppliers as we work together to create a more sustainable industry.

Medan was chosen as the first location to organise the 2016 workshop series for suppliers for GAR’s Belawan refinery and some companies supplying CPO and PK to GAR’s Lubuk Gaung refinery and Dumai bulking unit. A similar workshop will be organised later this year for suppliers of GAR’s Tarahan and Dumai/Lubuk Gaung refineries in Jakarta and Pekanbaru respectively.

GAR is the world’s second largest palm oil plantation company, with more than 480,000 hectares of plantation managed directly or through its plasma smallholders. It is also a significant buyer of CPO and PK for processing. In 2015 GAR procured over seven million tonnes of CPO and PK from independent and GAR-owned mills. GAR strengthened its sustainability commitment last year, launching the GAR Social and Environmental Policy to build on five years of experience of driving sustainable change on the ground.

GAR will continue to publish supply chain and sustainability data on the GAR Sustainability Dashboard as part of its wider commitment to responsible and open reporting. GAR is now working on the next phase of supply chain mapping to the individual plantations and will announce a time-bound plan by the end of this quarter.