Recently reported by Chain Reaction Research and written by Albert ten Kate (Aidenvironment), Gabriel Thoumi, CFA, FRM (Climate Advisers) and Eric Wakker (Aidenvironment), as of Q4 2015, the Oetomo family owned 28 percent of PT Dharma Satya Nusantara Tbk (DSNG), and Theodore Permadi Rachmat and family owned 25 percent. Two other families and other investors held the remaining 47 percent. DSNG generates 70 percent of its revenue through oil palm segment and 30 percent from its wood products segment.
As of 30 September 2016, DSNG had a planted area of 90,000 hectares (including plasma), of which 65,000 ha contained mature oil palm trees. The company’s planted area is located in Kalimantan. The mature areas are mostly located in East Kutai district, East Kalimantan.
Sustainability Policy and Recent Practices
- 2015 oil palm revenue: IDR 3,100 billion
- 2015 CPO-production: 407,000 tons
- Sustainability policy and recent practices: moderate risk
- 2016 No Deforestation, No Peat, No Exploitation (NDPE) CPO buyers: Golden Agri-Resources, Wilmar
- 2016 NDPE buyers percent revenue: 70%
- Since 2015, strengthened sustainability policy, slowed down operations in contested areas
DSNG lacks a specific NDPE policy. However, on its website it states its intention to avoid development in peatlands and areas with high carbon reserves, to preserve areas that have High Conservation Value (HCV), and to implement Free, Prior and Informed Consent in its land development process. In Q4 2015 it started publishing carbon assesments for some of its undeveloped plantations. The company has no official policy for complying with the United Nations Guiding Principles on Business and Human Rights or the ILO core conventions.
DSNG is a member of the RSPO. The company has never submitted any New Planting proposals to the RSPO, even though it has cleared and planted oil palm in new concessions. Three of its six mills have been RSPO certified. It aims to achieve 100 percent RSPO certification in 2018.
In 2013, 2014 and 2015, DSNG expanded its planted area by 9,000 ha annually. In 2016 no expansion occurred. As shown in Figure 1 below, since 2013 the company has developed oil palm concessions in a forested area in West Kalimantan that is orangutan habitat. In this time, DSNG cleared 1,500 ha of High Carbon Stock (HCS) forests.
|Figure 1: Concession boundaries of DSNG’s plantation companies PT Kencana Alam Permai and PT Prima Sawit Andalan (Sintang district, West Kalimantan). Since June 2015, some small patches (maximum 30 ha) of HCS forests have been cleared (marked in red). Presently, remaining HCS forests inside the concessions comprise 3,700 ha.|