Chain Reaction Research has produced a sustainability risk analysis report for Sime Darby's Liberian operations and has made the following observations and recommendations: 

Sime Darby’s Liberian operations are at crossroads: The company needs to develop a new strategy for the coming years, reflecting both market and environmental and social risk trends. In light of these trends, three expansion scenarios exist: 

• In Scenario A, Sime Darby could be in non-compliance with its Free, Prior and Informed Consent (FPIC) commitments. In this scenario, it would aggressively develop its concession area in accordance with the investment plans that formed the basis of the 2009 concession agreement. Risks however include forceful removal of a large number of communities.
• Scenario B assumes Sime Darby respects the 2km buffer zones, obtains FPIC from the required 55 communities. This may lead to a three-year project delay beyond the baseline scenario. This scenario will require direct negotiations, financial compensation, and reparations to local communities, increasing the project cost. As a result, production costs might rise from the current 83 percent of revenue to 87 percent of revenue.
• In Scenario C, Sime Darby abandons the idea of expansion of its own plantations, and relies on an outgrower model for development of its concession. This requires a paradigm shift away from its initial business model to a participatory approach that balances all interests. It would be the scenario with the lowest chance for local conflicts to develop, less strenuous and time-consuming FPIC processes, and is most in line with the emerging agendas for economic development and environmental conservation.

The report and media items related to this story are below: