“Minimum requirements for supply chain re-entry after suspension due to NDP non-compliance”

Preface: This document offers guidance on how to re-integrate palm oil suppliers into global supply chains after
suspension specifically due to deforestation and/or peatland development violations. It has been developed by a
working group of NGOs and companies committed to NDPE implementation in palm oil supply chains, with
participation from Aidenvironment, Earthworm, CORE, Mighty Earth, Musim Mas, Sime Darby, and Wilmar. The
document has also been reviewed by other companies and NGOs through limited consultation to date, to incorporate
emerging best practice thinking.

The scope of this document is focused specifically on deforestation and/or peatland development violations. For
exploitation issues including land disputes, social conflicts and labor rights violations, relevant thresholds for
suspension and minimum requirements for re-entry to a trader’s supply chain, developed in consultation with civil
society organizations, should apply.

These requirements should be aligned with any forthcoming guidance related to suspended group-level suppliers that
may emerge from other multi-stakeholder initiatives such as the HCSA and the RSPO.

We invite you to offer feedback to ensure this document reflects best practice guidance for suspended supplier re-
engagement - please do so by COB May 28, 2019 only through the online link below, so we capture all feedback
in an organized fashion. The Working Group will meet again after that date to discuss feedback and revision of
the guidance, and will reply to all respondents with a summary response addressing the feedback provided.

Survey: Feedback on Re-entry Criteria

Draft version: May 8, 2019

“Minimum requirements for supply chain re-entry after suspension due to NDP non-compliance”

SCOPE:

Where a company/group-level supplier has been suspended for an NDP (no deforestation and/or no peatland
development) violation, it must demonstrate that it meets the following minimum requirements at a group-level
before being considered eligible for re-entry to a trader’s supply chain.

The decision pertaining to the re-entry of suppliers based on these requirements is made at the discretion of, and
independently by, a respective trader. Decisions about re-entry may also take into account other non-NDP factors and
considerations in addition to the minimum requirements outlined below. Non-NDP factors could include amongst
others, exploitation-related violations or grievances, commercial considerations, supply chain factors, etc.

For exploitation-related violations including land disputes, social conflicts and labor or human rights violations,
thresholds for re-entry to a trader’s supply chain should be developed, in consultation with relevant stakeholders.

Should similar group-level requirements related to NDPE violations emerge from the HCSA and/or RSPO multi-
stakeholder processes, the following requirements should be aligned with those benchmarks.

Minimum requirements for a suspended group-level supplier to meet before being considered eligible for re-entry
to a trader’s supply chain, following an NDP violation:

1. Implement an immediate group-wide moratorium on land clearing and peatland development including an
immediate management directive that operationalizes the group-wide moratorium through a Stop Work
Order effective immediately;

2. Acknowledge the total area of non-compliant development (areas developed post-31 December 2015
without HCV, HCSA or social impact / FPIC assessments, or areas developed in contravention of HCV/ HCS
assessment recommendations) within the group’s entire concessions and publicly commit to resolving the
non-compliant development through a credible and comprehensive Recovery Plan;

3. Immediately halt all planting activities on non-compliant development areas (pending the development of a
Recovery Plan);

4. If additional land development is planned, commit to conduct HCV and HCS assessments, following the
integrated HCV-HCSA Assessment Manual and approved by the HCVRN Quality Review Panel;

5. Publish a group-wide NDPE (‘no deforestation, no peat, no exploitation’) policy or re-affirm commitment to
existing group policy or sign a group-wide agreement to comply with the trader’s existing NDPE policy;

6. Commit to develop and socialize new Standard Operating Procedures (SOPs) in line with the NDPE
requirements within six months;

7. Provide maps (in appropriate format) of the group’s entire concessions, including planted and any unplanted
areas (such as boundaries of confirmed HCV and HCS conservation set asides), either to a public monitoring
platform or to the relevant supplier monitoring program for the purpose of assessing the scale of non-
compliant development and ongoing monitoring by traders and third-parties;

8. Agree to independent remote sensing monitoring and facilitate possible field visits of relevant sites for
deforestation and peat development breaches;

Draft version: May 8, 2019

“Minimum requirements for supply chain re-entry after suspension due to NDP non-compliance”

9. All peatland canals developed after [cut-off date]1 shall be permanently blocked by building compacted peat
dams (following best practice guidance on building such dams and an FPIC process); and

10. Publish reports at least every six months in the first year, then annually, demonstrating compliance against
the above requirements.

Requirement Verification of Detail

# specific
requirements
1 Presence (public Checklist:
or copy of  Documented commitment in letter, statement, or policy form,
internal that is signed by the appropriate authority in the company
communications)  Documented evidence in the form of SOP, internal circular, or
similar, that confirms the moratorium commitment is
operational including implementation date, i.e. incorporated
as part of the company’s operations
 Evidence of internal distribution list of the above documented
evidence

2 Presence (filed Checklist:

publicly on  Letter or statement acknowledging total areas that would be
traders’/ buyers’ subject to a Recovery Plan, signed by the appropriate
grievance log authority within that company
corresponding to
grievance)
3 Presence (copy Checklist:
of internal  Documented evidence in the form of internal circular, or
communications) similar, that confirms a moratorium on planting activities on
non-compliant development areas

4 Presence Checklist:
(HCV/HCS  Evidence that an appropriately qualified HCV-HCSA team of
assessments filed assessors has been hired by the company
through HCVRN  Provision of timeline of the assessment process and expected
Quality Review completion date of report, and expected submission date to
Panel) (where the HCVRN Quality Review Panel

1
The Working Group was unable to come to consensus on this point and invites feedback specific to this element and date
during the consultation. Mighty Earth advocates (based on discussions with Al Hooijer/Deltares and Greenpeace) that all
non-compliant canal development built after December 31, 2015 should be permanently blocked before a group is able to
re-enter the supply chain. Other Working Group members advocated that all canals built after January 1, 2019 should be
blocked before a group is able to re-enter the supply chain while canals built after December 31, 2015 but before January 1,
2019 should be subject to Recovery Plan guidance, which as proposed requires a commitment to canal blockage pending
FPIC process completion, but would not need to be completed in advance of the group being considered for re-entry to the
supply chain. Other stakeholders have suggested utilizing a landscape-approach linked to government peat conservation
plans rather than canal blocking linked to specific dates.

Draft version: May 8, 2019

“Minimum requirements for supply chain re-entry after suspension due to NDP non-compliance”

necessary for
future Checklist for follow up once suspension is lifted:
development)  Approved HCV-HCSA report is provided along with updated
HCV-HCSA compliant land use plan of any new development
 Progressive updates (at key milestones, or time-bound) of the
land use development is provided to trader to enable
monitoring that the new development is in line with the HCV-
HCSA compliant land use plan.
5 Presence (public Checklist:
or copy of signed  Documented policy at group level, or at all largest
agreement, or denominator entities in the group (e.g. country level, separate
trader publishes unit level, etc.)
on traders’ site o OR
confirmation of  Statement or letter committing to a specific traders’ NDPE
signed policy, that is signed by appropriate authority in that company
agreement) that specifies applicability at group level. This statement or
letter can be combined with the statement or letter on
moratorium commitment if applicable.
6 Presence (public Checklist:
or copy of  Availability of internal operational documents, such as work
internal instructions or SOPs, etc. that are relevant to: “New
documentation) Development” (including selection of sites), “Maintaining
existing peat areas” (including recognized better practice on
peat management such as RSPO), “FPIC 8and community
rights” and “Workers’ rights and conditions” (consistent with
recognized better practice such as the RSPO), etc.

Note: Given this requirement goes beyond the requirement of just

the deforestation or peat development component, and
recognizing that the “E” part of the commitment often requires
more time to develop appropriate SOPs– it may be that this
criterion would be better suited as a time-bound milestone after
re-entry.
7 Option 1: Map Checklist:
published on  Evidence that maps in shapefile format have been published
company’s on the company’s website
website OR
(preferred)  Maps in shapefiles provided to the trader in question
Option 2: Maps OR
made available  Agreement in writing from the appropriate authority in the
for monitoring to supplier company that group-wide maps will be shared on a
third party named public platform or other traders’ monitoring program
commissioned by AND
the company  Confirmation received from public platform or other traders’
(second best) monitoring program, that the group wide maps have been
Option 3: Maps shared
sent to third
party platform
(GFW, RSPO)

Draft version: May 8, 2019

“Minimum requirements for supply chain re-entry after suspension due to NDP non-compliance”

8 Independent Checklist:
verification:  Evidence that a contract has been entered into with a third-
remote sensing party organization to provide monitoring (costs may be borne
monitoring by trader, by supplier, or both)
 Provision of timeline and details for the third-party monitoring
work
9 For canals - Checklist:
Independent Immediate blocking of new peatland canals in cases of the
verification: following:
remote sensing  Canal was opened post [date]
monitoring
10 Presence of Criteria:
reports (public,  Report on progress is published at least once every 6 months
or copy of report in first year; after first year report published at least once
provided to every 12 months
customers)

Draft version: May 8, 2019