FGV Annual Report 2020

87 Who We Are How We Operate How We Are Governed Additional Information Sustainability Matters Statement & Discussion By Our Leaders Operational Excellence Improvement of production yield and enhancement of operational leveraging on innovation, research & development as well as the sustainable environmental and climate conscious policies and practices. • High percentage of old palm trees (age profile). • Low mill throughput. • Pandemic and restrictive orders/ policies by the Government. • Production not meeting Test After Completion. • Increased risk in CPO trading activities. • Increase the usage of PalmPro for tall palm area. • Daily monitoring on yield achievement among the internal stakeholders. • Strengthen implementation of Good Agriculture Practice during replanting activities. • Improve maintenance standard in mills and adopting new technology to solve bottleneck in processing line. • Setting up of COVID-19 Management Task Force. • Continuous assessment of Group’s financial position and resources. • Active engagements with business partners, regulators and any other relevant third parties. • Addition/replacement of current equipment for capacity/reliability improvements. • Installation of low steam turbine exhaust pressure and transformer output pressure. Sustainability Certifications Compliance with the RSPO Principles and Criteria for purposes of certification and alignment of practices with the most widely accepted sustainability standards for the palm oil industry. • Compliance with sustainability (ISCC, MSPO, COSS) certifications. • Delay on the regularisation of workers. • Negative perception on lack of actions taken by FGV in addressing sustainability. • Suspension of FGV’s RSPO Certification. • New agreements for all external FFB suppliers, which include requirements to comply with FGV’s policies and procedures. • Strengthen traceability information. • Adopt responsible recruitment policy and process to ensure all parties involved in the process, in particular the recruitment agencies, are in compliance with the policy/ process. • Engage with Sustainability team to understand all commitments made by the company, grey areas and KPIs. • Continuous engagements with NGOs, media, and relevant stakeholders to clarify raised issues. • Develop and monitor RSPO action plan to be in line with standard requirements. • Collaborate with Suhakam to conduct assessment of living and working conditions at FGV’s plantations and mills. • Managing and enforcing contractors/vendors to comply with national laws and regulations, company policies and SOPs. Business Development & Product Quality Venture into new markets/new businesses and efforts to develop products that meet customers’/ consumers’ needs. • Impact of Approval Permits and Market Liberalisation. • Lower returns on new investment/project. • Production not meeting Test After Completion. • Rapid speed of disruption with innovations from competitors. • Trade barriers in destination markets. • Engage with relevant government agencies/ministries. • Conduct proper feasibility study/market analysis on proposed investments. • Improve equipment reliability through modifications or replacements. • Develop new healthy variant/value added product segments for sugar business. • Maximise opportunities in existing high demand markets. • Ensure there are no washout contracts for delivery. assessing SUSTAINABILITY MATTERS Sustainability Matters What it Means to FGV Link to Our Key Risks Mitigation Actions