Responsible Plantation Management While not directly owning forest or concessions, <strong>APP</strong> works closely with its pulpwood suppliers <strong>and</strong> independent professional assurers to maintain internationally recognized st<strong>and</strong>ards for forest stewardship. Suppliers Forest Management Research & Development Governance & Compliance (Chain of Custody) 92 <strong>APP</strong> 08/09 <strong>Sustainability</strong> <strong>Report</strong> <strong>APP</strong> 08/09 <strong>Sustainability</strong> <strong>Report</strong> 93
Responsible Plantation Management Responsible Plantation Management Responsible plantation management is more than good tree farming: it is the combination of continuous advancements in silvicultural research <strong>and</strong> development, careful rooting <strong>and</strong> nursery plant growth, pest <strong>and</strong> disease control, optimum field planting, planning <strong>and</strong> rotation management, maintenance of soil fertility, water management, low impact harvesting, fire prevention <strong>and</strong> compliance with Indonesian forestry regulations. Legally Sourced <strong>Pulp</strong>wood <strong>APP</strong> does not manage any forest l<strong>and</strong>, or hold any forest concession leases. However, we do work very closely with our exclusive pulpwood suppliers – co-ordinated <strong>and</strong> managed under the umbrella of Sinarmas Forestry (SMF) – to ensure that all timber raw material is legally sourced <strong>and</strong> fully traceable. We dem<strong>and</strong> that it be grown, felled <strong>and</strong> delivered in full accordance with Ministry of Forestry regulations, <strong>and</strong> with internationally recognised forest stewardship guidelines. These things are very important to reassure our pulp <strong>and</strong> paper customers. Hence, our policies <strong>and</strong> practices on pulpwood procurement are subject to systematic, independent, internationally recognised third-party audits. Contrary to common perception, only a small percentage of Indonesia’s designated production forest area is allocated to the pulp <strong>and</strong> paper sector of the economy. Indonesia’s total l<strong>and</strong> surface area is some 191 million hectares 3 , with 110 million hectares designated as permanent forest l<strong>and</strong>, an area roughly the size of Spain. In the National Spatial Plan, some 51 million hectares of this permanent forest area (about the size of Sweden) is set aside for conservation, with the balance potentially available for production forestry. National policies are specifically designed to use production forests to help alleviate poverty <strong>and</strong> drive sustainable economic development to benefit of the nation’s more than 230 million residents. Of Indonesia’s 191 million-hectare l<strong>and</strong>mass, just over 1.7 percent is allocated for pulpwood plantation development, to support the nation’s pulp <strong>and</strong> paper sector. Our Partner: Sinarmas Forestry Sinarmas Forestry (SMF) co-ordinates the supply of pulpwood to our Indah Kiat – Perawang <strong>and</strong> Lontar Papyrus integrated pulp <strong>and</strong> paper mills in Sumatra. It does this by managing the activities of four major forestry operating companies <strong>and</strong> 32 partner plantation forest licence holders. The four major companies are: Arara Abadi <strong>and</strong> Satria Perkasa Agung in Riau, Sumatra; Wirakarya Sakti in Jambi, Sumatra, <strong>and</strong> Finnantara Intiga in West Kalimantan. The operating companies undertake the ground preparation, planting, nurturing, felling <strong>and</strong> delivery to mill of selected fastgrowing timber species on l<strong>and</strong> specifically designated for plantation forestry by the government of Indonesia, which also leases the l<strong>and</strong>. As of December <strong>2009</strong> <strong>APP</strong>’s pulpwood suppliers operating under the SMF umbrella – held valid licenses to develop about 2.5 million hectares of forest concessions in Indonesia. Around 40 percent of these leased areas is set aside, principally for conservation purposes but also for the development of community timber-farming opportunities <strong>and</strong> related infrastructure projects. Responsible Plantation Management: Compliance Indonesian forestry regulations require that all prospective plantation concession areas be subject to several independent ecological, environmental <strong>and</strong> social assessments prior to the authorisation of any plantation development in order to identify <strong>and</strong> protect high conservation value areas that exist within the concession boundaries. The assessments include the statutory AMDAL (Environmental Impact Analysis), a Macro-Micro Delineation assessment <strong>and</strong> a Long-Term Forest Management Plan with third-party identification of areas to be protected within the licensed pulpwood plantation. The AMDAL <strong>and</strong> the Macro- Micro delineation process – <strong>and</strong> its findings – must be endorsed by appropriate local authorities <strong>and</strong> the Ministry of Forestry before plantation development begins. Once areas to be protected are identified, <strong>APP</strong> <strong>and</strong> SMF consult with government agencies, non-governmental organizations (NGOs) <strong>and</strong> other interested parties to draft advance plans for the rehabilitation <strong>and</strong> protection of any designated high conservation value areas. As part of the AMDAL process, forest communities living on or near the identified conservation areas are extensively consulted. <strong>APP</strong> <strong>and</strong> SMF communicate their operational plans with the communities <strong>and</strong> help identify ways in which these communities can participate in, <strong>and</strong> benefit from, the prospective plantation development. An open <strong>and</strong> early dialogue can help to promote harmony between the parties, <strong>and</strong> identify the community’s most urgent needs, such as access to clean water, school <strong>and</strong> health facilities, vocational training, or basic infrastructure. Graphic 17 - Multiple stages within the pulpwood plantation approvals <strong>and</strong> development process Feasibility Study Independent Micro Delineation Environmental Impact Analysis SMF Critical Forest Assestment Application for <strong>Pulp</strong>wood Plantation Permission for Timber Application for L<strong>and</strong> Conversion The processes involved in developing pulpwood plantations are detailed <strong>and</strong> lengthy, <strong>and</strong> specifically look at the conservation value of the proposed l<strong>and</strong>, biodiversity levels, eco-systems, cultural <strong>and</strong> social balance <strong>and</strong> the government’s National Spatial Plan. All SMF plantations supplying <strong>APP</strong> mills successfully underwent the required AMDAL <strong>and</strong> other assessments <strong>and</strong> meet prevailing local l<strong>and</strong> use regulations. Responsible Plantation Management: Certification <strong>APP</strong> invests heavily in third-party verification of our pulpwood supply to place beyond doubt our commitment to legal raw materials sourcing <strong>and</strong> sustainable plantation management. This independent assurance plays a vital role in the monitoring <strong>and</strong> certification of our operations, <strong>and</strong> ensures that illegally felled wood does not enter our mills. M<strong>and</strong>atory Certifications Sustainable Production Forest Management (PHPL) The Ministry of Forestry’s PHPL certification scheme assesses forest operations against national best practices. By the end of <strong>2009</strong>, some 1.37 million hectares (54 percent) of the pulpwood plantations managed by SMF had been certified by the Indonesian Independent Verification Institute (LPI). SMF aims to achieve full m<strong>and</strong>atory Sustainable Forestry Management certification by 2015. Timber Legality Verification Systems (SVLK) In <strong>2009</strong>, the Ministry of Forestry released new regulations 4 on the st<strong>and</strong>ards <strong>and</strong> guidelines for assessing <strong>and</strong> evaluating the implementation of Sustainable Production Forest Management (PHPL) <strong>and</strong> Timber Legality Verification Systems (SVLK). In <strong>2009</strong>, Lontar Papyrus <strong>and</strong> Wirakarya Sakti helped the government measure the field compatibility of its new regulations by volunteering to undergo independent evaluation by SGS Indonesia, under the observation of the Indonesian Ministry of Forestry, European Commissions’ Forest Law Enforcement Governance <strong>and</strong> Trade (FLEGT) 5 Action Plan, <strong>and</strong> the Multi-Stakeholder Forestry Programme organization (MFP) 6 . Submission <strong>and</strong> Approval for Operating Plan Independent Macro Delineation Begin Operations The SGS Indonesia evaluation found that <strong>APP</strong> was able to implement the new regulation on SVLK, though some further development was required regarding wood identification <strong>and</strong> traceability links within the chain-ofcustody systems. Full compliance with SVLK must be evaluated by an independent assessor <strong>and</strong> verification body <strong>and</strong> accredited by the National Accreditation Committee. Voluntary Certifications The Indonesian Ecolabelling Institute (LEI) The LEI-PHTL st<strong>and</strong>ard is a voluntary plantation forest certification scheme. By the end of December <strong>2009</strong>, around 11 percent of the pulpwood plantations that supply <strong>APP</strong> were certified under LEI’s Sustainable Forest Management (SFM) st<strong>and</strong>ard. This was scheduled to increase to some 25 percent in 2010, with the aim that the balance of the pulpwood plantations supplying <strong>APP</strong>’s mills will attain certification by 2020. In <strong>2008</strong> <strong>and</strong> <strong>2009</strong>, pulpwood supplier Wirakarya Sakti achieved LEI SFM certification for 293,800 hectares of plantation forest from the TUV Rheinl<strong>and</strong> Indonesia, an independent certification body. This represents the largest LEIcertified plantation in Indonesia. 3 Figure sourced from Eksekutif Data Strategis Kehutanan 2007, Departmen Kehutanan, Direktorat Jenderal Bina Produksi Kehutanan (BPK) <strong>2008</strong>; Statistik Kehutanan Indonesia 2006, 2007, Departemen Kehutanan; Keputusan Menteri Kehutanan tentang Penunjukkan Kawasan Hutan dan Perairan; Tata Guna Hutan Kesepakatan 1984. 4 P.38/Menhut-II/<strong>2009</strong> <strong>and</strong> P.6/VI-Set/<strong>2009</strong>. 5 Forest Law, Enforcement, Governance, <strong>and</strong> Trade 6 www.mfp.or.id 94 <strong>APP</strong> 08/09 <strong>Sustainability</strong> <strong>Report</strong> <strong>APP</strong> 08/09 <strong>Sustainability</strong> <strong>Report</strong> 95
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