FAQ & Reports
Olam Palm is committed to developing RSPO certified palm plantations and processing plants that will coexist with diverse, carbon and species-rich forests, healthy ecosystems, and thriving communities. We work closely with communities as well as local and international partners in this endeavour.
In the spirit of constructive engagement, we have detailed here our responses to the most common questions we receive, particularly with regard to our sites in Gabon – Mouila and Awala. Also listed are a number of relevant Summary Reports. Olam’s Social & Environmental Impact Assessments and High Conservation Assessments are available on request and we welcome your questions and insights.
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Olam’s palm business will focus primarily on Africa in terms of plantation development, refining and end markets. Olam Palm is already a leader in sustainable palm oil development in the region through our plantations in Gabon, started in 2011. We source palm oil and products from our own plantations as well as Asia to sell into markets in sub-Saharan Africa and European markets. Olam Palm plans to selectively participate in refining in markets offering attractive margin and growth opportunities. We will also consider plantation development opportunities in Asia, which will be on a smaller scale compared to our operations in Gabon.
Olam is committed to growing responsibly therefore we are working towards adherence to the Roundtable on Sustainable Palm Oil (RSPO) Principles and Criteria to achieve certification for our plantations. We completed the New Planting Procedure (NPP) for all four plantation areas in Gabon prior to commencing land preparation (the first company in Africa to do so). Compliance with the RSPO P&C is the baseline for our developments – Awala was certified in August 2016 and Mouila plantations are on track for certification in 2017-18. We will continue to work with stakeholders to further develop Olam’s Palm Oil Policy. You can learn more about the RSPO at www.rspo.org and view the Principles and Criteria as well as New Planting Procedures.
Olam has partnered with the Republic of Gabon in a 60:40 Joint Venture to develop 100,000 hectares of palm plantations over two phases selected as suitable for planting from a total leasehold land bank of 300,000 hectares. During the first phase, Olam Palm Gabon plans to develop 50,000 hectares of industrial palm plantations. Upon successful completion of the first phase, up to 30,000 hectares of oil palm will be developed under smallholders to enable communities to fully benefit economically from oil palm development
The development is expected occur over several years until 2019, and any land allocations that are not found to be suitable for RSPO-certified palm will be returned to the Government. Areas allotted to date for potential oil palm plantation development are shown below (areas in hectares):
|Location||Total Area||HCV and Buffer zones||Area for plantation||Completion date|
|Mouila 1*||35,354||18,324||16,000||End 2015|
|Mouila Lot 2*||31,969||17,920||11,573||2017|
|Mouila Lot 3*||24,066||6,680||17,000||2017|
* Final planted areas may vary slightly from this figure, based on operational surveys and cultural “chance finds”, other infrastructures such as roads, mill are not included in this table.
**31,890 hectares not included in this table were returned to the Republic of Gabon having been ruled completely unsuitable for certified palm.
The smallholder cooperative developments are also being developed as a JV with the Republic of Gabon (51:49 RoG/Olam respectively) under the Sotrader company and expects to complete its New Plantings Procedure for 58,000 ha of savannah plantings in October 2016, of which 52% (30,000 ha) will be planted, the remainder being set aside for village use areas, river buffer zones, wildlife corridors and High Conservation Value areas.
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We are committed to obtaining RSPO certification for our plantations and therefore carry out robust due diligence prior to development. Of land originally allocated in 2010, two concessions totalling 31,890 hectares were ruled entirely unsuitable for certified palm based on results of our agronomic, social and environmental due diligence (not included in the above table), and returned without reserve to the Republic of Gabon. Furthermore, across our three plantations in the regions of Kango (Awala plantation) and Mouila (Lots 1, 2 and 3), as a result of our HCV assessments, Olam identified 50,000 hectares suitable for development and more than 55,000 hectares which will be conserved. Olam is working with the Government to help inform its National Land Use Plan in order to avoid agronomically unsuitable, HCV or high carbon stock lands, since these should be reserved for other uses such as conservation, traditional activities or forestry.
Olam Palm has invested substantial time and resources completing a high level of agronomic, environmental and social due diligence prior to commencing plantation development as per the requirements of RSPO’s New Plantings Procedures and Gabon’s national regulations. Our partners, the Republic of Gabon, are also committed to a strongly held belief in conservation embodied by one of the three pillars of the country’s strategy known as ‘Green Gabon’, and have committed at the highest level to producing a Land Use Plan that avoids primary forests, High Carbon Stock forests, HCV ecosystems (Gabon declaration to the UNFCCC, 2015). Therefore, criteria such as identifying high conservation value areas and developing a management plan to ensure the implementation and consistent monitoring of social and environmental commitments are a mandatory part of the process.
For our plantations we carry out LIDAR surveys, Environmental & Social Impact Assessments (ESIA), High Conservation Value Assessments (HCV), and obtain the Free, Prior and Informed Consent (FPIC) of communities. (You can read more about FPIC here). Our assessments are subject to a rigorous public consultation process at the local and national level and subject to external audit prior to validation.
Since 2015 we have committed to ensuring HCV assessments are conducted according the HCV Resource Network’s quality control processes (HCV Assessor Licencing Scheme) and peer reviewed: we are the first company globally to comply with these stringent requirements for our Mouila Lot 3 plantation.
Through this process, any areas identified as HCV or ecologically sensitive in the concessions are excluded from development and conserved at our own cost.
Likewise, if communities wish to maintain customary use of land, these areas are demarcated and maintained for community use. Any development on lands belonging to local communities are subject to a written Social Contract signed off by the community, local government and Olam, specifying the nature of the compensations Olam provides in return for the use of the land. This rigorous process gives us a high level of confidence that our plantations will develop as part of a living landscape, co-existing with healthy ecosystems and thriving communities.
In Gabon we only operate in savannah, scrub, woody pioneer vegetation or logged-over forest areas where carbon stocks are significantly lower than mature forest, and only where a third party assessment (based on a combination of stakeholder consultation, LIDAR mapping, biodiversity surveys and forest inventories) with full public and expert consultation, has not revealed the presence of High Conservation Values, and where development will not have significant negative impacts on conservation in a broader landscape.
We recognise the importance of secondary forest for biodiversity and social uses, and most of our HCV areas are, in fact, also logged forests. For instance, our concession near Kango is covered by secondary forest that has gone through 7 to 10 rotations of logging, and is therefore termed as degraded. Meanwhile, our sites in Mouila are covered by a forest-savannah mosaic where previous repeated logging, combined with hunting pressure, have greatly diminished the quality of habitats.
Areas of forests that are more mature, which have a refuge function for key species, or which are important for community activities are identified through High Conservation Value assessments and set aside from development.
Furthermore, Olam Palm is not planting in any wetland areas, and has taken necessary steps to protect water bodies in and adjacent to the plantation, where they exist.
A robust High Conservation Value assessment is completed to facilitate the identification and delimitation of areas that are important for maintaining fauna and flora. Our vision is for plantations to coexist with natural ecosystems in carefully planned and managed landscapes. We don’t operate in primary forests, instead targeting savannah areas, scrub, highly degraded or secondary forests. Even so, we have worked with experts to identify and set aside around 50% of our land leases in High Conservation Value areas and river buffer zones. Through the proper implementation of management plans, we ensure that the impact on sensitive areas by development of plantable areas is reduced if not eliminated.
Considering all our palm plantations together, our current assessment is that the Olam Palm Project will be at least climate neutral, if not significantly net Carbon positive over the first 25 to 30 years of the project, allowing for the net carbon fixation from our extensive plantations in low carbon, fire prone savannahs and from the maturation of previously logged HCV areas which we are actively managing and protecting.
Our Palm Policy commits us to avoiding developments in lands which would result in major emissions of Greenhouse Gases (GHG), i.e. primary forest, High Carbon Stock Forest (HCS), High Conservation Value (HCV) areas and peatlands. Olam Palm incorporates the estimation of GHG emissions from plantation development in our Environmental Impact Assessment. It is an evolving process and one that we are working with local stakeholders on as well as the RSPO through trialling the PalmGHG Calculator and sharing carbon stock calculation methodologies. Likewise, the country has committed to developing a climate action plan (Gabon INDC to the UNFCCC) which includes protection of HCS and HCV forests in its a land-use plan for the allocation of land to agriculture, mines, infrastructure and conservation, integrating sustainable growth in its development strategy.
However, until now there has been no international consensus on the definition of HCS forests. There are several key HCS initiatives in development, which we expect will mature during the course of 2015. Firstly, it is necessary for Gabon to set out how it will deliver on its UNFCCC commitment to conserve HCS forests. Secondly, two major international multi-stakeholder groups comprising NGOs and businesses are collating the evidence necessary to define HCS for palm plantations:
- The HCS Approach Steering Group has published an “HCS Toolkit” (April 2015) which goes a long way to defining ‘viable forest areas’ and is “designed for use in fragmented forest landscapes and mosaics”. Such a landscape is not typical of Gabon. We believe that HCS, HCV and FPIC are interlinked and complementary concepts and that a context-suitable HCS process is needed for much more highly forested nations such as Gabon.
- The international High Carbon Stock Study Group published a consultation draft of its Science Study in June 2015 to work with us and with the Government of Gabon to guide an HCS+ process suitable for forest-rich nations. We aim to share our findings more widely and work towards a convergence of views on HCS. The High Carbon Stock Study Group has appointed two independent chairs, Jonathan Porritt, a senior international environmentalist, and John Raison, formerly the chief ecosystem scientist of the Australian federal government agency for scientific research, CSIRO. The work intends to clearly “define what constitutes HCS and establish HCS thresholds that take into account not only environmental concerns but also socio-economic and political factors in developing and emerging economies.” The HCS Study is looking specifically at carbon stores above and below ground.
‘Zero deforestation’ commitments, whether stand-alone policies or pledges made through the Consumer Goods Forum (CGF), Tropical Forest Alliance (TFA) and the New York Declaration on Forests, are surprisingly complex to implement. Highly forested nations feel that they should not be held to the same standard as those which have already deforested a large proportion of their lands, and there is heated debate about forest definition and thresholds, ‘zero-gross’ versus ‘zero-net’ deforestation, and carbon offsetting.
Olam’s plantations are in Gabon, a country which has about 88% forest cover. However, to reduce its reliance on food imports (currently about 60%) and to diversify its income away from fossil fuel exports, the Government has embarked on a major agricultural plan where there was previously very little activity – mainly subsistence. Hence the joint ventures with Olam for palm and rubber.
While grassland, savannah and scrub are the preferred landscape for our plantation development, it has been supplemented with some areas of low-density logged-over forest. These areas are where carbon stocks are significantly lower than mature forest, and only where a third party assessment with full public and expert consultation has not revealed the presence of High Conservation Values.
The debates continue over definitions of ‘zero-deforestation’ and we are in the lead working groups on the subject. In the meantime, we focus on our Commitment to forest conservation which is practical and transparent; based on our experience of responsible plantation development in Gabon, and governed by our Sustainable Palm Policy (2015) and our Plantations, Concessions and Farms (PCF) Code, this commitment aims to:
- protect High Conservation Value (HCV) and primary forests, in order to conserve biodiversity and ecosystem services
- protect High Carbon Stock (HCS) forests and manage greenhouse gas emissions, in order to limit climate impacts from land use change, and
- respect the rights of local communities through Free, Prior and Informed Consent (FPIC).
Olam Palm Gabon has set a benchmark of quality for HCV assessments in Africa since 2011, selecting sites with the least possible impact, and protecting the most valuable forests in the landscape.
We are the only company to date (2016) to publish a fully independent High Carbon Stock analysis of our plantation footprint, which showed a net positive impact on the climate. We have delivered on social contracts with all the villages in the vicinity of our plantations. We have improved the underlying science through multiple research projects, and supported the Gabon government in its efforts to establish a sustainable National Land Use Plan. Whilst the policy debate rages on, our hope that our record speaks for itself.
Maintaining water quality is a key priority. Olam identifies and excludes riparian zones and steep areas from development to maintain the quality of water bodies that are in and adjacent to our sites. We protect all rivers, streams and lakes with broad, vegetated buffer zones to prevent sediments, fertilisers and other agrochemicals from reaching surface waters. We also carefully control the timing and quantity of fertilisers and other inputs to minimise leaching to the water table, and our mills will be built to maximise water efficiency and treat waste water to safe levels. Treated Palm Oil mill effluents will be used to fertilise palm estates, reducing chemical fertiliser inputs. As a part of our Environmental Management Plan, we monitor water quality by carrying out sampling in addition to maintaining forested riparian areas and planting cover crops to prevent erosion.
We have also responded to villagers’ need for a reliable water supply, and drilled or rehabilitated wells and pumps in villages around our plantations.
It is not only Olam’s strategy to grow responsibly, but it is also integral to Gabon’s goal to develop their agricultural sector to broad base its economy, while conserving natural resources at the same time. The country is currently reviewing their land use policy to ensure the sustainability of agricultural development. Olam is supporting the Government in this endeavour with other local stakeholders by making recommendations for the land classification process and we plan to share data from our Landscape Assessment once completed. We are also contributing LIDAR mapping which is supporting Government’s effort to map carbon stocks of forests.
The identification and setting aside of HCV areas is undertaken with the help of recognised experts, approved by the HCV Resource Network Assessor Licensing Scheme. Almost all of this HCV area is logged forest with a mix of secondary and old-growth species. These forests are relatively biodiverse, represent the best natural areas within our concession and provide connectivity to the adjacent landscape. They are home to the wild species found in Gabon, elephant, chimpanzee, gorilla and forest buffalo, as well as a host of lesser known protected, rare or endemic species.
We have therefore conducted extensive biodiversity surveys during our Environmental and Social Impact Assessments (ESIAs) and supplementary surveys during the start-up phase of operations to guide land use plans, zoning and management. Once developments are complete, these impacts will be continuously monitored, tracked, and resurveyed every 3 to 5 years for better management of conservation objectives.
In 2015, Olam Palm Gabon added approximately 7,000 ha to conservation areas and we implemented a partnership with WWF and the Government of Gabon to prevent illegal hunting and enforce wildlife laws in our Mouila plantations. We aim to implement similar agreements elsewhere.
In addition for 2015, Dr Christopher Stewart, Head of Environment and Sustainability for Olam Gabon contributed a case study to a book by the Arcus Foundation: State of the Apes – Industrial Agriculture and Ape Conservation (see Chapter five).
The numbers of great apes (most notably Western Lowland gorillas and chimpanzees) near our concession areas are relatively sparse and include some family groups and individual apes. In State of the Apes Dr Stewart outlines the 6 pillars of our ape management plan:
(1) Allocate areas for intact habitat (HCV areas) for preservation
(2) Ensure robust baseline and ongoing monitoring protocols
(3) Require scheduling of land preparation to enable wildlife to move to HCV areas
(4) Implement protocols that mitigate potential for disease transmission between apes and humans
(5) Impose hunting controls and raise awareness among local communities
(6) Support the development of subsistence programmes to promote alternatives to hunting.
Apart from setting aside and managing the conservation spaces related to our plantations, the key success determinant is the education and creating awareness amongst the local communities of the importance and process of maintaining the sanctity of these sites.. An environment manager and an HCV team at each site is dedicated to managing buffer zones and set-aside areas, working with the national authorities to enforce anti-poaching regulations and to increase awareness of the hunting laws and the status of protected species.
First and foremost, earning the social license to operate is integral to the successful long term development and management of plantations. Olam identifies the impacts on affected communities and completes social participatory mapping to determine areas used for subsistence agriculture, collection of non-timber forest products (NTFP) and sites of cultural significance. The results of these studies along with the Environmental Impact Assessment are shared with communities so that they can make informed decisions about their future. If a proposed development is initially accepted, community representatives and Olam adopt procedures for consultation and identifying individuals or groups entitled to compensation, and eventually both parties agree to terms and conditions of development, which are signed and witnessed by all parties in our Social Contracts.
Olam’s FPIC and longer term community engagement processes were developed by a social expert with decades of experience working with communities in the Congo Basin in our timber concessions. We have also hired and trained male and female social communicators from communities where we operate. This team understands the traditional social structures in villages adjacent to the plantation and the best means of communicating with different stakeholder groups within them to ensure they understand the implications of the proposed development. Furthermore, Olam recognises that it takes time for communities to consult among themselves and therefore plans investments accordingly.
One of the main areas is in helping communities to become farmers producing a range of quality foods that they can sell and help to reduce Gabon’s reliance on food imports. We initially established a support programme for food production around our plantation sites. We started with the village at Nsilé as it has its own irrigation system. It was then extended to 7 villages around the Awala plantation. If the model proves successful, we will replicate it by forming cooperatives. Today, 250 volunteers are divided into 31 farming groups, each responsible for a plantation, ranging from bananas, cassava, mangos, avocados or atangas. Olam’s technical experts help them to prepare the land and train them on the best farming practices such the safe and appropriate use of pesticides.
In addition, we started a programme in partnership with IGAD (Institut gabonais d’aide au développement) which aims to contribute significantly in improving food security around Mouila, by providing a reliable, sustained income to villagers who are unable to work in Olam’s plantations. Processing equipment and machines for cassava are donated to small-scale farmers and training is provided on how to use them profitably.
Finally, Olam maintains a buffer zone of several km between villages and plantation boundaries of our developments, providing communities with space to continue collection, cultivation and hunting activities, and allows access through the concessions to villagers with prior traditional rights, so that they can continue with fishing and legal hunting activities.
In Gabon, the current unemployment rate is 21%, and 32.7% of the population is at or below the poverty line (World Bank), therefore the Government of Gabon is working on a strategy to develop agriculture to create rural employment and reduce the urbanisation rate.
As a result, Olam Palm has committed, in agreements with local communities, to hiring locally. As of October 2016 we have created more than 6,000 jobs for unskilled or semi-skilled Gabonese workers in rural areas. We also provide regular training for staff to progress in skills and responsibility. All our staff are paid at least the legal minimum wage, and have opportunities to earn more through overtime and high productivity. We don’t allow any form of child labour on our plantations, and we are developing a world-class Health and Safety management system to protect workers starting out in an unfamiliar industry. Once fully planted, our plantations may employ more than 8,000 people and catalyse the creation of a significant number of indirect jobs in outgrower groups, service sectors and associated developments.
Olam’s Palm business pays at least minimum wage of CFA150,000 to workers. We are not only focused on creating jobs, but also developing the skills of our workforce. We believe the development of skills through the agricultural sector will eventually lead to expansion in the value added sector, providing greater opportunities for young entrepreneurs.
Olam Palm provides workers with health check-ups when they commence work to ensure they are fit to work. Where we work HIV/AIDS is prevalent, and we do not discriminate against individuals who are HIV positive. Olam Palm is fostering an environment of acceptance through an HIV/AIDS Peer Education Programme through which we endeavour to train 1 in 25 workers. Our QEHS team also holds training programmes to workers and staff on other issues such as sexual harassment, Personal Protection Equipment use, and safe application of phytosanitary inputs. Our preliminary estimate of the cost of direct and indirect contributions to healthcare through our plantation development will be about US$0.5 million per annum.
Olam aims to minimise emissions through ensuring 100% utilisation of palm by-products by the mill boiler and establishing methane capture from palm oil mill effluent. The methane captured will be converted into biogas, which will generate energy for mill activities and domestic needs. The Awala mill, with an integrated kernel crushing plant, is in operation. The Awala Biogas Plant will be installed shortly after in 2017, whilst the Mouila Lot 1 mill is targeted to be commissioned by 2017.
Olam is developing a better understanding of other palm standards and their application in the African context, however we believe that RSPO remains the strongest multi stakeholder standard at this point in time. Through our involvement in coffee and cocoa, we have developed considerable knowledge and experience with Rainforest Alliance, much of which we can transfer to our palm operations. The Olam Corporate Responsibility and Sustainability team plays a critical role in advising sustainability functions across product teams, based on this knowledge.
Olam Palm proactively participates in international RSPO working groups among other initiatives to share our experience working under other certification schemes but also developing palm in Africa, where some RSPO members have planned plantation developments. Our commitment to transparency has led us into productive and mutually beneficial discussions with NGO stakeholders, contributing to improvements in our own practices as well as a better understanding for local experts and NGOs of the palm oil sector. Lastly, we played a significant part in promoting the National Interpretation of RSPO in Gabon, which should be finalised later in 2015.
Currently Olam Palm Gabon has no FFB suppliers from independent or schemed smallholders. The first smallholders’ initiative was launched by Republic of Gabon in December 2014 (SOTRADER), and nurseries have been set up to supply future smallholder growers. It will be several years before the first growers can start harvesting and supplying Olam.
Olam is committed to ensure all suppliers, including schemed and independent smallholders, for our mill will be complying with the Olam Sustainable Palm Oil Policy. SOTRADER joined RSPO in July 2015, and all development shall comply to the RSPO Standard.
Olam has ceased usage of Paraquat since 2012. Olam has also committed to use WHO 1A & 1B class pesticides only in exceptional circumstances where no alternatives are available.
Since we first started developing plantation in 2011/2012 Olam has committed to no use of fire during new plantings and replanting.
As stipulated in the Sustainable Palm Oil Policy, this applies to our third party suppliers.
Since 2014 we have conducted supply chain mapping of our Palm Oil suppliers, which includes tracing back supplies to the mills, to gain full awareness of their supply base. Olam will take the steps below to ensure that we meet our 2020 sustainability targets. Please click here for our interim Progress Report [add link]
- All Palm Oil suppliers to Olam will have signed the Olam Supplier Code by the end of 2015
- Palm Oil supplies will be traced back to the sourcing mill of production through information verified from our suppliers
- We will complete the work we started in 2014 on full traceability of our sources of Crude Palm Oil and Palm Kernel Oil (CPO and PKO) by the end of 2018. This will be based on verified targets for the following years: 2016 – 30%; 2017 – 50% and 2018 – 100%
- Traceability of Palm Oil derivative products will be completed by the end of 2020. This will be based on the following verified targets: 2017 – 30%; 2018 – 50% and 2020 – 100%
- We will progressively work with our suppliers to eliminate uncontrolled and unsustainable sources by the end of 2020, including sources that do not conform to our Commitment on Forest Conservation as stated in our Palm Policy.
For our processing facilities in UK, Mozambique and trading business, Olam is sourcing directly from 14 major suppliers. Our own mill and refineries in Gabon is sourced from our own plantations and fully traceable back to origin.
Since we embark in our supply chain mapping, we understand complexity of tracing back supplies to the mills and their supply base, specifically for palm derivatives, one direct supplier could connect to hundreds of third party suppliers.
Since we made our end-to-end sustainable supply chain commitment and traceability road map in June 2015, we have made progress in different areas. See our First Progress Report on Sustainable Supply Chain and Traceability.
All suppliers of palm oil and derivatives to Olam have already signed the Olam Supplier Code and/or have established a sustainable palm oil policy that includes commitment on supply chain traceability. This means that all of the palm oil we trade and use comes from suppliers who are committed to ensuring that their suppliers conform to the Code which covers environmental and labour issues.
The process of complete certification of the supply chain is a path dependent process, it needs to know exactly where and how the fresh fruit bunches (FFB) are grown. We are working with our suppliers to trace back the oil to the mill as a first step and have taken the logical timeline for this activity to be duly completed.
Today, 40% of global palm oil produced by smallholder farmers. The sustainable chain of custody for derivatives requires engagement with multiple partners. The debate about environmental footprint certification also overlaps the livelihood of smallholders in remote locations and this exercise of tracing the supplies back to sustainable sources needs to also take into account the human impact of the decision.
As a way forward, our company has partnered with the World Resources Institute (WRI), conduct a risk assessment of the supply base around a 50 km radius of all the mills in our palm oil Supply Chain. This will assist our team to prioritise field inspections to verify compliance and design engagement actions with our progressive suppliers.
The following documents are available on the website.
• New plantings document
• Summary of HCV and ESIA
• Summary of HCV and ESIA management plan
• Public summary report for certification assessment (www.rspo.org) •
Summary of IPM plan, continual improvement plan, occupational health and safety plans, pollution prevention and reduction plans, land titles/user rights, outcome of negotiated agreements and compensation claims and details of complaints and grievances will be made available to stakeholders upon request. Please email email@example.com for more info.