Investor Relations

Balancing Conservation And Oil Palm Development – ANJ’s Sustainable Approach

16 Mar 2015


ANJ recognizes the merits of arguments on whether more land should be developed for oil palm cultivation in countries such as Indonesia.

Proponents of development say oil palm has the highest yield/ha of any crop plant and it is therefore well suited to help satisfy the food and energy requirements of a developing nation.  To this end, the Government of Indonesia has allocated more than 9 million hectares of land for conversion to oil palm cultivation by 2030, together with land use plans that provide a template for sustainable development [1].  Land use plans for West Papua, for example, cover 10 million hectares, of which up to 24% could be developed for agricultural purposes with the balance set aside for sustainable forestry (34%) and permanent conservation forests (40%) [2].

Stakeholders with alternative land use proposals argue that further cultivation of palm oil will inevitably involve deforestation and should therefore be resisted. They recognize that even within areas set aside for cultivation, there may be forest areas whose destruction would materially harm biodiversity. To address this situation, the term “intact forests” was coined.   This is defined as an “unbroken expanse of natural ecosystems within the zone of current forest extent, showing no signs of significant human activity and large enough that all native biodiversity, including viable populations of wide-ranging species, could be maintained [3].”

This definition, however, gives rise to several possible interpretations, including that by proponents who have relied on satellite imagery to declare that expanses of vegetation with no apparent cleared areas are “intact forests”.

Reliance on such satellite imagery has also been responsible for a misinterpretation of ANJ’s activities in West Papua as it does not take into account the steps ANJ has taken to strike a sustainable balance between development and conservation.

Within ANJ’s allocated land concessions of 54,321 ha in West Papua, the company commissioned certified consultants to conduct high conservation value (HCV) and social impact assessments (SIA) in accordance with RSPO procedures. The assessments indicated that development was feasible, and accordingly land clearance commenced in February 2014.

On 21st July 2014, Greenomics Indonesia, an environmental policy group, issued a report entitled “Busy Years Ahead until 2017” in which it stated that ANJ was clearing areas of intact forest in West Papua.  Greenomics stated that such clearance  would be in conflict with the policies of Musim Mas (effective from 2017) and Wilmar for no development of high carbon stock forest and high conservation value forests(effective 2013); both major buyers of crude palm oil from ANJ.

As ANJ takes such allegations seriously, we conducted a review of the process and permits obtained by ANJ leading up to the commencement of land clearance. The review confirmed that all the requisite assessments were valid and had been carried out correctly, with the exception that ANJ had at the time, not fully completed adherence to the RSPO’s New Planting Procedures (NPP) framework before commencing with land clearing at its West Papua subsidiaries PMP and PPM.  Accordingly, ANJ imposed a voluntary moratorium on all development at both locations until complete NPP requirements were met.

Among the NPP requirements was that a 30-day public consultation period be given, and relevant HCV, SIA and EIA reports be posted on the RSPO website [4]. No stakeholder comments or concerns were raised during this period. Following confirmation from RSPO that it was in compliance with the NPP, ANJ resumed development at its sites.

Following on from this, ANJ has commissioned a second round of HCV and SIA assessments conducted by a different, but also RSPO accredited, assessor. These reports will be used in the preparation of a comprehensive development plan for the ANJ concessions to help ensure that those areas of forest deemed critical for regional biodiversity will as far as possible be conserved.

These measures aim to go above and beyond the requirements of the RSPO standard and underline ANJ’s belief that agribusiness, done properly, can address the purpose of sustainability,  and strike a balance between the need for development at both national and local levels and the conservation of biological diversity,  and sustaining  environmental goods and services.

This is an approach that is also evident at ANJ’s other estates. For example, at the Siais plantation in Sumatra, a 1,500 ha forest area within the estate – more than 15% of the concession, has been voluntarily conserved and actively protected.   This contrasts with the surrounding areas including those within a national park, which had received no management protection, being severely depleted. Meanwhile, at ANJ’s Kalimantan estate, 600 ha has been set aside to establish an orangutan conservation area and the company is also working with the government to protect an additional 2,900 ha adjacent to the property in order to establish a second orangutan conservation area.

Not all will agree with our approach to economic development and conservation as the most practical course for a sustainable future, but we believe responsible agribusinesses and environmental stakeholders both seek to strike a balance between development and conservation. ANJ welcomes constructive feedback and input on its activities in the interests of all stakeholders. If you have any opinions on this issue please write to us by using the space available below.

[1] Greenomics Indonesia,
[2] Government of Indonesia, Table of extent of Primary Forest in Papua Barat and Planned Land Use
[3] Intact Forest Landscapes,
[4]      jaya-agri-pt-permata-putera-mandiri


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