Human rights abuses are rife in Indonesia’s booming palm oil industry, found an in-depth investigation by Bloomberg Businessweek.
The report focused on abuses on plantation estates controlled by Kuala Lumpur Kepong (KLK), the world’s fifth-largest palm oil producer. Bloomberg Businessweek found evidence of fraud, human trafficking, violence against workers, and apparent slavery on plantations owned by KLK in Indonesian Borneo. The report said the abuses may have been carried out by companies contracted by KLK, rather than the Malaysia-based palm oil giant itself.
In an interview with Bloomberg Businessweek, KLK CEO Tan Sri Dato’ Seri Lee Oi Hian said “it is not our policy to condone abuse of workers, ‘slavery’ practices, or exploitation of workers.”
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[Lee] stresses that the company requires contractors to adhere to “rules and regulations of the country” including minimum wage standards, but that KLK management “does not regulate the workers. Some of these workers, of course, are employed by the contractors. But subsequent to the complaints raised by the NGOs … our management is very well aware that they have to check on the contractors.” He claims that “we are moving more and more to direct hire practices.”
Bloomberg Businessweek noted that KLK supplies palm oil to a number of U.S. companies, including Archer Daniels Midland (ADM), BASF (BASFY), California Oils, Procter & Gamble (PG), and Unilever, and 61 million pounds to Cargill.
“Cargill has sold palm oil and its derivatives to Nestlé (NSRGY), General Mills (GIS), Kraft Foods (KRFT), and Kellogg (K),” the report stated. Several of the companies have palm oil sourcing policies in place that should exclude such product.
Rainforest clearing for palm oil production in Malaysian Borneo.
The full report is available at Indonesia’s Palm Oil Industry Rife With Human-Rights Abuses.
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