Palm Oil Giant Indofood Subsidiary Loses Sustainability Certification Over Labor Abuses

February 7, 2019 / Suspension of RSPO Membership Looms / San Francisco, CA

Today the world’s largest palm oil certification scheme, the Roundtable on Sustainable Palm Oil (RSPO), ordered the suspension of the “sustainability” certificates of Indonesian palm oil giant Indofood’s subsidiary, London Sumatra (Lonsum). 

Palm treesPalm trees forest getting cut down for palm oil

This is the latest episode in an ongoing saga with the company after over twenty violations of the RSPO’s standard and 10 violations of Indonesian labor law were found in a RSPO investigation. Investigating Indofood’s palm oil plantations all sparking by a complaint against the company, brought by Rainforest Action Network (RAN), International Labor Rights Forum (ILRF) and Indonesian labor rights organization OPPUK. That was back in October 2016.

Suspending Lonsum’s RSPO certificates comes after Indofood announced its plans to withdraw from the certification scheme. They announced that over two weeks ago. So they did that and not comply.  Yes comply with a RSPO decision that the company needed to give an action plan. An action plan addressing the labor abuses on its plantations. The RSPO further warned that it will end the RSPO membership. That’s of Lonsum’s parent company, Salim Ivomas, if no action taking occurs within the time frame given. Indofood is one of the largest palm oil companies in Indonesia. As well as will be the largest to lose its RSPO membership if sanctioned.

Palm trees rainforestPalm trees must be saved

Also many palm oil buyers claim to have cut ties with Indofood. That was before this sanction.  Some including companies are Nestle, Musim Mas, Cargill, Fuji Oil, Hershey’s, Kellogg’s, General Mills, Unilever, and Mars. However, many companies still do business with Indofood. As well as stay connected to its labor abuses, including joint venture partners PepsiCo, Wilmar and Yum! Brands, as well as investors and lenders to Indofood, like BlackRock, Rabobank and Japanese banks SMBC Group, Mizuho Financial Group and Mitsubishi UFJ Financial Group (MUFG).

In conclusion, RAN, ILRF and OPPUK continue to call on Indofood to discuss the ongoing labor violations. As well as adopt a comprehensive ‘No Deforestation, No Peatland, and No Exploitation’ policy. Finally one policy that applies to Indofood, the entire Salim Group and all third-party suppliers.

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