On February 5, 2013, after decades of environmental and social conflicts in Indonesia, Asia Pulp & Paper (APP) announced a new Forest Conservation Policy (FCP) including a commitment to zero deforestation. Over the past many years, APP has been criticized for its practices which led to the clearing of millions of hectares of rainforest, the destruction of tiger habitat, displacement and human rights violations of indigenous and rural communities, as well as the release of huge amounts of greenhouse gases into the atmosphere due in large part to the conversion of peatlands into industrial pulp plantations. In April 2014, APP expanded its commitment to include the protection or restoration of a million hectares of Indonesian rainforest. Then in February 2015 APP announced a new implementation plan to address issues raised by an independent evaluation. Actions were announced in August 2015 by APP on the development of peatland management standards, high-tech LIDAR mapping of peatland , and removal and restoration projects on 7,000 hectares of plantations.
APP’s commitments represent a great opportunity to address its legacy of environmental and social impacts and to change its future practices away from deforestation. However, implementation on the ground is slow and in some cases barely non-existent. An independent evaluation by the Rainforest Alliance, as well as recent reports by other NGOs, have shown gaps and serious challenges that will require more time to be addressed.
These reports revealed that, while APP suppliers’ own deforestation and new peatland development has stopped, deforestation by third parties continues in many of their concessions. Additionally, numerous social conflicts remain unresolved and improved peatland management and landscape restoration plans have yet to be developed. These independent reports on APP’s performance during the last two years, and future monitoring by NGOs, should provide good direction for continued learning and improvement by APP.
The following unresolved issues have arisen within recent months:
- The magnitude of unresolved social conflict emerged tragically with the murder of the farmer union activist Indra Pelani in February 2015 by security guards contracted by APP. In June, Indonesia’s National Human Rights Commission found gross human rights violations transpired with this case, indicating that significant risk of additional legal violations remains.
- The Rainforest Alliance evaluation found that the company is failing to stop third party deforestation, which is still widespread in set-aside forest, inside APP and supplier concessions.
- About half of APP’s plantations are located on peat soil that, once drained, is highly inflammable. The unaddressed heritage of decades of bad peatland practices, combined with third party deforestation and with a long dry season, has made APP plantations one of the sources of the fires that have been ravaging Sumatra and Borneo. The fires have created a smoke and haze crisis that is affecting the entire South East Asian region. It has impacted the health of millions of people in Indonesia and neighboring countries and has led to several deaths. The crisis has also caused schools to close around the region, shut down air transport, and released each day more greenhouse gasses than the average daily emissions from all of the USA. Investigations in Indonesia have reportedly led to the arrest of an APP affiliated concession manager (Bumi Mekar Hijau) while authorities in Indonesian and Singapore (under the Transboundary Haze Pollution Act) have opened legal investigations into APP.
NGO stakeholders have been discouraged by the pace of progress on key issues and by recent changes in stakeholder engagement formats. The ongoing fires, the unresolved social conflicts highlighted by Mr. Pelani’s murder, the ongoing deforestation by third parties, the gaps reported by the Rainforest Alliance evaluation and the company’s expansion plans are worrying developments that risk jeopardising the credibility of APP’s forest policy.
On 6 October 2015, Environmental Paper Network co-ordinated NGOs came together to send an open letter to APP expressing their concerns and proposing a broader set of recommendations.
APP’s answer to this letter is unsatisfactory, essentially reiterating the many steps that have been announced in the past months, without giving any new response to NGO concerns and recommendations. APP’s willingness to act on these recommendations and demonstrate change on the ground must be the measure that paper customers and investors adopt in their scrutiny of APP’s performance. Until such changes are independently verified, APP poses too many social, environmental and governance risks to do business with.