We highly appreciate your organization’s commitment to human rights and interest in our company’s business activities.

Before addressing your specific inquiries, we would like to introduce our company as a socially responsible global entity that is strongly committed to complying with sovereign and local laws and regulations, respecting the cultural values of local communities, and fulfilling our corporate social responsibilities.

PT Inecda, a Samsung C&T’s subsidiary in Indonesia, operates in strict compliance with the Roundtable on Sustainable Palm Oil (RSPO) standards and respects the traditions and culture of the Talang Parit Indigenous Community.

PT Inecda obtained its RSPO certification in 2019 for sustainable palm oil production. Since then, the company has undergone annual on-site audits conducted by the RSPO. In May 2024, PT Inecda successfully renewed its certification, meeting the higher standards set forth in the latest criteria.

With this context in mind, we provide the following responses to your inquiries.

1) Regarding Indigenous Rights Violations

With respect to the land use rights raised in the article, PT Inecda holds legal rights to the land, which were obtained through due legal process in accordance with Indonesian laws and regulations. As a private entity, PT Inecda does not interpret or assess the law independently, but strictly follows the legal framework established by national and local authorities.

The legal status of the indigenous community referenced in the article is a matter governed by the written laws of Indonesia.

However, Samsung C&T acknowledges and respects the community as a customary law community as recognized under the Indonesian Constitution and we remain committed to fostering a mutually beneficial relationship with the local community through our corporate social responsibility (CSR) initiatives, such as improving village infrastructure, promoting local residents’ self-sufficiency, etc.

2) Regarding RSPO Complaint Panel’s Conclusion

① P&C 4.2: There is a mutually agreed and documented system for dealing with complaints and grievances, which is implemented and accepted by all affected parties.

PT Inecda has established a grievance mechanism accessible by all affected stakeholders. The company is committed to strengthening its process for obtaining consent from stakeholders.

② P&C 4.4: Use of the land for oil palm does not diminish the legal, customary or user rights of other users without their free, prior and informed consent.

The RSPO Complaint Panel concluded that PT Inecda should have conducted participatory mapping with the involvement of indigenous community citing that PT Inecda operated its plantation without obtaining Free, Prior, and Informed Consent (FPIC) from the Talang Parit community that holds customary land rights, when extending its land use rights in 2020. In response to this ruling, PT Inecda will submit its land survey plan to the RSPO by June 9th, and will proceed with participatory mapping in coordination with a qualified facilitator.

Following the completion of the survey, PT Inecda will engage in consultations with the Talang Parit community and ensure full compliance with RSPO guidelines throughout the process.

3) Regarding Child Labor

Samsung C&T’s subsidiaries in Indonesia strictly prohibit the use of child labor on their palm plantations. This prohibition is explicitly outlined in collective labor agreements, and internal guidelines are in place to ensure compliance throughout the recruitment and employment process.

We conduct thorough identity verification in collaboration with external institutions such as banks and insurance providers. All new hires are supported in opening bank accounts and enrolling in the national social security system. In addition, we conduct regular on-site inspections and utilize biometric fingerprint scanning systems to manage attendance and prevent proxy sign-ins. Also, our subsidiaries support child welfare by operating an on-site school, providing school bus services for students, and maintaining a child-care center to assist employees with young children.

4) Regarding Responsibility for Plantation Fires

In September 2019, a fire occurred within the concession area of PT Gandaerah Hendana. However, the incident took place in an area inhabited by local residents, where PT Gandaerah is not authorized to cultivate.

In August 2021, the Indonesian court issued a final ruling, stating that PT Gandaerah is not liable for the fire incident.

Despite the fire originating outside the company’s operational control, PT Gandaerah took immediate action to help suppress it. The company maintains firefighting equipment on its plantations and mobilized all available resources to assist in extinguishing the fire.

We hope the above responses sufficiently address your concerns. Samsung C&T remains committed to respecting local communities and will continue to make unwavering efforts to ensure sustainable palm oil production.

Thank you.