Traceability

Traceability

Traceability is an essential element of our business and is instrumental in fulfilling our commitment to responsible sourcing.

In FGV we are committed to ensure that our products are not linked to any risk of exploitation of workers and human rights, deforestation, planting on peat and open burning, which is in line with FGV’s Group Sustainability Policy (GSP).

We consider mills traceable (TTM) when details such as their name, name of parent Company, Address /GPS coordinate and volume supplied is known. Our definition for TTP varies by supplier’s category.

An estate is considered TTP when their name, parent company name, address/GPS coordinate, volume supplied and size of plantation is known while a smallholder plot is accepted as TTP if the name of the smallholder, the volume and the farm location at village or sub-district level can be identified. As for traders, we entrust them to keep the details as above for their suppliers and only request the summary on the number and quantity by their supplier group for evidence of TTP.

Given to the complexity of our supply chain that involves multiple levels, we are working closely with our suppliers, business partners and independent agencies to achieve full TTP by 2021. Although the restricted movement due to Covid-19 pandemic has limited physical engagement with our suppliers, our target for full TTP remains unchanged.

1.  Traceability in Oil Palm
In order to ensure our palm products are sourced from responsible suppliers, we started to trace our raw materials in 2017. From 2017 till now we have maintained full traceability (100%) to the mills (TTM) that we buy palm products from. Since then we are actively tracing the origin of our fresh fruit bunches (FFB) and by the end of 2020 we have achieved 82% TTP. This includes all sources of FFB in our supply chain (FGV and third party mills) and we are committed to achieve 100% TTP by 2021. Most of our FFB supplies (around 50%) comes from smallholders having land about 10 acres (4 ha) per house hold, while our own estates contribute about 25% of FFB, the remaining are from FFB dealer networks. Considering the significant contribution from the smallholders, we are committed to assist them on technical grounds to further improve their productivity. Our TTP data for full year 2020 was externally verified by Malaysian Institute of Supply Chain Innovation (MISI).

2. Traceability in Rubber
FGV sources cup lump as the raw materials for its milling process from FGV’s Group estates, FGV associate (FELDA), private/external organizations and traders. The four rubber processing mill in Malaysia produce Standard Malaysian Rubber (SMR) for end users in local and international markets.

Considering rubber may have some similar sustainability concerns as oil palm, FGV continued to expand traceability in rubber sector in early 2020. As of December 2020, we are 82% traceable to plantation/collection centre. We expect to achieve 100% TTP traceability for our local supplies and plan to expand this traceability initiative to our overseas suppliers in 2021.

Palm Oil Traceability Dashboard (January 2020 – December 2020)

Upstream

Traceable to mill
Traceable to plantation

Crude Palm Oil

Palm Kernel Oil

Upstream

Crude Palm Oil

Palm Oil Mill

81%

Palm Kernel Oil

Palm Oil Mill

81%

Downstream

Crude Palm Oil

FGVR & DOP

81%

100%

Traceability In The Operational Units

Refineries – CPO (4 plants)

  Traceability to Mill Traceability to Plantation
Percentage of Internal CPO
Kuantan Oil Products 100% 73% 99.6%
Sahabat Oil Products 100% 97% 100%
Tawau Oil Products 100% 95% 100%
Delima Oil Products 100% 81% 100%

 

FGVBSB

70%

100%

Traceability In The Operational Units

Biodiesel (FGVBSB – 1 plant)

  Traceability to Mill Traceability to Plantation Percentage of Internal CPO
FGV Biotech 100% 70% 100%

Total Downstream

80%

100%

Palm Kernel Oil

FGVR

79%

100%

Traceability In The Operational Units

Refinery – PKO (FGVR – 1 plant)

  Traceability to Mill Traceability to Plantation Percentage of Internal CPO
Kuantan Oil Products 100% 79% 95.2%

 

FKP

79%

100%

Traceability In The Operational Units

Kernel Crushing Plant (FKP – 4 plants)

  Traceability to Mill Traceability to Plantation Percentage of Internal PK
Semambu 100% 72% 90%
Pasir Gudang 100% 82% 98.6%
Pandamaran 100% 81% 100%
Sahabat 100% 97% 100%

 

Total Downstream

79%

100%

FGVR : FGV Refineries Sdn Bhd FGVBSB : FGV Biotechnologies Sdn Bhd DOP : Delima Oil Products Sdn Bhd
FKP : FGV Kernel Products Sdn Bhd FGVPM : FGV Plantations (Malaysia) Sdn Bhd  

Rubber Traceability Dashboard (January 2020 - December 2020)

Traceability-of-Product (TOP)

While we are able to trace all our FFB and PK up to supplying mills, tracing FFB to the plantations of origin has been challenging for external crops. To facilitate better traceability of our products, we are working with our business partners to develop a model to identify sustainability risks associated with specific geographical areas.

In promoting greater traceability, we have developed a computerised traceability system called Traceability of Product (FGV-ToP), which is part of an overall Sustainable Palm Oil Management System (SPOMS) that also includes Audit Integrated System (FGV-AIMS).

Strategic Partnership with MIMOS and MISI

In ensuring suppliers’ compliance to our standards, FGV is working with the Malaysia Institute for Supply Chain Innovation (MISI) and Malaysia’s National Applied Research and Development Centre (MIMOS) to work on the validation of traceability data information, verification of external suppliers’ compliance to our Group Sustainability Policy, and development of FGV’s suppliers’ sustainability status through Preferred Network Programme (PNP).

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    FGV Holdings Berhad

    Group Governance & Risk Management Division
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    Level 13 West, Wisma FGV, Jalan Raja Laut, 50350 Kuala Lumpur
    Tel: 1800-88-8717
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