Engagement with Meridian Palm Oil Mill and Tier-2 Suppliers on NDPE Commitments
08/06/2023, Responsible Sourcing

IOI Corporation Berhad (IOI) has recently completed an engagement visit to Meridian Palm Oil Mill (Meridian Mill). It was a two-pronged engagement approach, aimed at enhancing existing collaboration with an IOI Tier-1 supplier and building engagement with an IOI Tier-2 supplier.

As a follow-up visit under the Supply Chain Mapping and Monitoring (SCMM) programme with Meridian Mill, Earthworm Foundation (EF) presented the progress made by Meridian Mill to enhance its supplier due diligence process and ensure the Fresh Fruit Bunches (FFBs) received are not linked to any new land clearing. Actions taken include mapping of FFB sources, monitoring supply base and raising dealers’ and smallholders’ awareness on our No Deforestation, No New Planting on Peat and No Social Exploitation (NDPE) policy. A significant increase in Meridian Mill’s traceability scoring is one of the positive outcomes achieved from this exercise.

IOI is pleased to note that Meridian Mill has taken another leading example to improve its supply chain traceability by reaching out not only to dealers and smallholders, but also to surrounding communities of Kampung Golong, Kampung Pinangkau and Kampung Tangkarason of Paitan, Sabah. Efforts taken by Meridian Mill signify the extension of their sustainability commitments, which are aligned with IOI’s Responsible Sourcing Guidelines.

During the engagement visit, three focus group discussions were conducted to engage community leaders and smallholders on topics such as current socio-economic status, existing land use and future development plans, relationship with neighbouring stakeholders and cases of potential wildlife conflict. Challenges faced by communities include difficulties on land matters, access to agriculture services (seedlings, fertiliser, etc.) and the need for potential supplementary livelihoods for smallholders. Throughout the visit, we engaged with close to 90 smallholders. The EF team made a presentation, deliberating on potential support they could offer in terms of coaching and technical advice. IOI will continue our discussion with Meridian Mill to monitor progress on collecting missing location co-ordinate points and smallholder empowerment programmes. 

Discussion with Meridian Mill progressed beyond our No Deforestation commitment, and IOI took the opportunity to deliberate on the Standard Operating Procedures (SOPs) for Tier-2 Supplier Compliance to IOI Sustainability policies where collaboration with Tier-1 supplier is key to ensuring success. Subsequently, IOI delivered a sharing session on Managing Labour Rights Risks and discussion based on the results of the 2022 Tools for Transformation (T4T) self-assessment. We shared suggestions on how to further enhance good labour practices particularly on monitoring of working hours, socialisation of payslip information and SOPs on passport safekeeping. We are pleased to note that Meridian Mill has invested in passport safekeeping facilities as one of its transformative steps towards meeting their No Exploitation (social) commitment. 

Discussion with Meridian Mill (File pic by IOI Corporation).
Engagement with smallholders (File pic by IOI Corporation).
Engagement with community leaders (File pic by IOI Corporation).

Engagement with smallholders and other stakeholders (File pic by IOI Corporation).