DIRTY BANKERS

PLANTATIONS
As of December 2015, Bumitama controlled a total of 23
plantation companies 76 and 12 crude palm oil (CPO) mills. 77 At the
same time, it owned and/or controlled a landbank of 207,000ha
in Central Kalimantan, West Kalimantan and Riau, 78 of which
164,177ha were planted (including 44,498ha of plasma scheme
plantation). 79 At this point, the company reported that ‘only
49.5% of our planted area has reached peak production age’. 80
PAST CONCERNS AND COMPLAINTS
Greenpeace investigations in 2012 and 2013 documented
destructive or illegal activity in Bumitama concessions in
Kalimantan, including extensive deforestation, peatland
conversion in new concession areas supposedly covered by
the Indonesian Government’s moratorium and destruction of
HCV forest including orangutan habitat. 81 This had a lasting
impact on the landscapes in which Bumitama operates. In
2015, a Greenpeace investigation highlighted how severe fires
had broken out in Bumitama’s PT Andalan Sukses Makmur
(PT ASMR) concession following the sustained conversion of
peatland and forest areas, including HCV forest and orangutan
habitat. 82 The concession is immediately adjacent to – and
at one point in its permit history partially overlapped areas
of – Tanjung Puting National Park, which has been designated
a Ramsar site. 83 HSBC policy prohibits ‘knowingly provid[ing]
financial services directly supporting projects which threaten
the special characteristics of … Ramsar Wetlands’. 84
Complaints were made to the RSPO in 2013 over
destruction of HCV forest threatening orangutan populations
in three of Bumitama’s concessions, 85 and the RSPO
suggested that such infractions by the group ‘may not be adhoc
but systemic in nature’. 86
At the time, Bumitama showed little effort to rectify the
problems. Early in 2013, the company claimed to have stopped
all development in one concession – PT Ladang Sawit Mas (PT
LSM) – having been alerted to the presence of orangutans,
although their presence had already been noted in a 2009
environmental impact assessment (AMDAL). However, despite
this undertaking being reinforced by a request from the RSPO
to suspend operations following complaint proceedings being
initiated, Greenpeace analysis of satellite images revealed that
some 1,150ha of forest were cleared between December 2012
and October 2013, 160ha of this after July 2013. This included
significant areas of peatland forest.
Until November 2013, only one of Bumitama’s two main
palm oil subsidiaries (BGA) was a member of the RSPO; the
other (BSL) was not. Bumitama transferred RSPO membership
to the parent group following pressure from NGOs and the
RSPO itself, 87 after previously trying to deflect an RSPO
complaint against a BSL concession (PT ASMR) on the grounds
that BSL was not an RSPO member. 88
HSBC contributed to a US$70m loan to Bumitama in
August 2013. At this date, the group had three outstanding
RSPO complaints against it (see ‘RSPO complaints relating
to Bumitama’), one relating to legality and two relating to
destruction of HCV forest, any one of which would put
Bumitama in clear breach of HSBC’s 2008 ‘Forest land and
forest products sector policy’. 89 What due diligence did HSBC
carry out before making this loan?
RSPO COMPLAINTS
RELATING TO BUMITAMA
1 July 2012 (PT Hati Prima Agro) – complaint by Sawit
Watch – license validity, illegal operations – complaint closed
21 April 2015. 90
10 March 2013 (PT Nabatindo Karya Utama)
– complaint by Centre for Orangutan Protection – clearance
of HCV forest including orangutan habitat – complaint closed
17 September 2015. 91
7 April 2013 (PT Ladang Sawit Mas) – complaint by
Friends of Borneo and International Animal Rescue – clearance
of HCV forest and endangering lives of orangutans – complaint
closed for monitoring 13 August 2014, final closure 2
September 2015. 92
18 September 2013 (PT Andalan Sukses Makmur) –
complaint by Friends of Borneo, Friends of the National Parks
Foundation, Indonesia, Siesfund, Australia – clearance of HCV
forest and illegal planting – complaint closed 14 August 2015. 93
13 November 2015 (Bumitama Gunajaya Abadi) – complaint
by Sawit Watch – illegal operations, failure to pay compensation –
complaint closed for monitoring 13 June 2016. 94
ENVIRONMENTAL POSITION
In 2015, Bumitama introduced a ‘No Deforestation, No Peat
and No Exploitation’ policy 95 and three earlier RSPO complaints
against the company (see ‘RSPO complaints relating to
Bumitama’) were closed.
CERTIFICATION AND TRANSPARENCY
Bumitama has stated that it plans to have its remaining
concessions RSPO-certified by 2020. 96 This fails to meet
HSBC’s policy deadline of full certification by 2018. 97 Bumitama
submitted 2015 Annual Communications of Progress to the
RSPO, but it has not disclosed maps of its concessions, stating
‘unclear legal standing on eMap. Risk of violating local regulations
in sharing maps (refer to letter from DG Plantations, Indonesia
Ministry of Agriculture on 13 Feb 2015).’ 98
MARKET LINKS
According to company data, Apical, 99 Cargill, 100 Golden Agri-
Resources (GAR), 101 IOI, 102 Musim Mas 103 and Wilmar 104 are
customers of Bumitama.
GAR, Wilmar and – via these traders – IOI are known to be
supplied by PT LSM and (GAR and IOI) PT KBAS. 105
AAK refused to confirm or deny any trade relations with
Bumitama. 106 Astra Agro Lestari failed to confirm or deny any
trade relations with Bumitama.
16 DIRTY BANKERS