11 March 2021

The Securities Commission of Malaysia has begun investigating palm giant Sime Darby Plantations, the company said on Thursday, following a complaint by a non-government body in the wake of a U.S. ban on imports over accusations of forced labour.

Anti-trafficking group Liberty Shared accused the world’s largest producer of sustainably-made palm oil of “wrongful disclosures” in its 2019 sustainability report, the firm said in a statement.

“As a responsible corporate citizen listed on the Malaysian bourse, Sime Darby Plantations will cooperate fully with the Securities Commission,” it added.

In December, U.S. customs placed a ‘withhold release order’ (WRO) on the company, after Hong Kong-based Liberty Shared petitioned it last year to ban Sime Darby products, citing evidence of labour abuse.

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“The conclusions reached by U.S. Customs and Border Protection and the issuance of the WRO...raise serious questions as to the scope and the accuracy of the disclosures and descriptions...in Sime Darby’s Sustainability Report 2019,” Liberty Shared wrote in the complaint reviewed by Reuters.

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Sime Darby said it had begun legal action this week in the United States against Duncan Jepson, managing director of Liberty Shared, to obtain key information on its complaint.

“This is the first time in SDP’s 200-year history that we have resorted to taking legal action against an NGO,” the company said.

In a text message, Jepson told Reuters, “I haven’t yet read the proceedings for discovery, but will do so and respond accordingly.”

Rights activist Andy Hall, recently appointed to Sime Darby’s human rights assessment panel, said he expected swift resolution of the litigation in a way that benefits the firm’s migrant workers.

They “remain at high risk of forced labour”, he told Reuters. (Reporting by Mei Mei Chu; Editing by Clarence Fernandez)