- A report commissioned by Indonesian palm oil giant Astra Agro Lestari into alleged violations allegedly by its subsidiaries on the island of Sulawesi failed to investigate key issues such as community rights, NGOs say.
- The investigation was triggered by multiple media and NGO reports on the long-running conflict between three AAL subsidiaries and local communities in Central Sulawesi province who allege the companies grabbed their land.
- The investigation failed to verify whether AAL’s subsidiaries had obtained the free, prior and informed consent (FPIC) of local and Indigenous communities before operating in the area, according to Walhi and Friends of the Earth US.
- Instead, the verification focused on proving whether the communities in the area had legal permits to their land that overlaps with AAL’s concessions, resulting in biased and inaccurate findings, the NGOs say.
JAKARTA — Environmental activists have slammed one of Indonesia’s biggest palm oil producers for a report that they say glosses over its alleged violations and ignores concerns raised by local communities.
One of the chief accusations against PT Astra Agro Lestari (AAL) is that three of its subsidiaries have illegally claimed or occupied more than 6,700 hectares (16,700 acres) of land in Central Sulawesi and West Sulawesi provinces without obtaining the free, prior and informed consent (FPIC) of local communities. An eight-month investigation commissioned by AAL and carried out by independent consultancy Eco Nusantara was expected to address this matter, but the ensuing report has instead fallen far short, according to critics.
“AAL’s new verification report conspicuously does not mention FPIC even once,” said Jeff Conant, senior international forests program manager at Friends of the Earth US. “Yet, FPIC is the critical factor for distinguishing between legitimate land acquisition and land grabbing.”
Instead, the investigation focused on proving whether the communities in the area had legal permits over their land that overlaps with AAL’s concessions. This produced biased and inaccurate findings, said Uli Arta Siagian, forest and plantation campaign manager at Walhi, Indonesia’s biggest environmental NGO.
“The investigation demanded communities show documentation for their land claims, while not requiring the same level of proof from AAL,” she said. “This completely ignores the power asymmetries between rural communities and powerful companies, as well as ignores the complicated reality of land rights recognition in Indonesia.”
Local and Indigenous communities have persisted throughout the Indonesian archipelago since long before the country gained independence in 1945. Yet many continue to have their land rights denied by the government in favor of large plantation and mining companies.
As recently as 2012, the government didn’t even acknowledge the existence of Indigenous peoples, claiming that none lived in Indonesia.
Eco Nusantara chief executive Zulfahmi said his consultancy chose not to look into the issue of FPIC because it didn’t exist as a concept when two of AAL’s three subsidiaries in question started operating in the area in 1994. It wasn’t until the 2000s that FPIC started being adopted by the plantation industry in general, he added.
He said that despite this, Eco Nusantara strove to be fair in conducting the investigation as it verified all permits obtained by the three AAL subsidiaries, he said.
Eco Nusantara was able to verify that one of the subsidiaries didn’t have a right-to-cultivate permit, or HGU, the last in a series of licenses that oil palm companies must obtain before being allowed to start planting. This shows that Eco Nusantara wasn’t only scrutinizing the communities in the investigation, Zulfahmi said.
“We dig into all parties in the report, and there’s no push from the company for us to cover up [any information],” he said.
Long-running conflict
The investigation was triggered by multiple media and NGO reports on the long-running conflict between the local communities and AAL subsidiaries PT Mamuang, PT Agro Nusa Abadi and PT Lestari Tani Teladan.
In a 2020 report by Walhi and Friends of the Earth US, the environmental NGOs alleged that the subsidiaries were engaged in land grabbing, environmental degradation, and the criminal persecution of environmental and human rights defenders. The report also said the companies had disposed of waste improperly and exacerbated flooding by clearing watershed areas.
The Central Sulawesi chapter of Walhi recorded up to 10 people as facing criminal charges brought by the companies, mostly for allegedly stealing oil palm fruit, occupying land without a permit, and making threats against company staff.
The Eco Nusantara investigation referred to the 2022 report, saying that the issues raised by the NGOs, particularly land grabbing and criminalization of farmers, were of greatest concern. However, the investigation and resulting 2023 verification report failed to fully analyze these issues.
In particular, the report didn’t verify whether AAL’s subsidiaries had obtained the FPIC of local and Indigenous communities before operating in the area.
Gaurav Madan, a senior forest and land rights campaigner at FOE US, said the focus of the investigation was decided entirely by AAL, without input from civil society and affected communities. This failure to consult the affected communities in developing the terms of reference for the investigation thus led to the burden of proof being put on the communities, according to Walhi and FOE.
It required communities to prove all their claims with legal evidence, regardless of their customary claims and rights to the land, which in Indonesia is a complex issue.
The terms of reference for the investigation also suggested the communities were previously landless and now wanted land owned by the AAL subsidiaries, further cementing the notion that the company has the right to the land, the NGOs said. Walhi and FOE called on AAL and Eco Nusantara to shift the focus of the investigation onto the company’s land acquisition process, permit history and business operations.
But AAL and Eco Nusantara ignored these suggestions, Walhi and FOE said.
As a result, both NGOs have rejected the findings of the investigation and called on buyers and consumer goods companies that purchase palm oil from AAL and are committed to respecting the FPIC process to suspend all sourcing from the company.
“Paper policies are only as good as their implementation,” Conant said.
Since the publication of the 2022 NGO report, 10 consumer goods companies have suspended sourcing from AAL to some extent, with U.S. food giant Kellogg being the latest to do so. The cereal maker joins the likes of Hershey’s, PepsiCo, and Oreo maker Mondelēz in distancing itself from AAL.
As for AAL, the company should return land that it has taken without consent, provide compensation to farmers for loss of land and livelihoods, conduct environmental restoration for damaged and degraded rivers, clear the names of environmental human rights defenders who have been criminalized, and issue a public apology for harm done, Walhi and FOE said.
They said it shouldn’t be hard for AAL to return the land as the total area being requested by communities amounts to less than 0.1% of the company’s entire land bank.
“How long must communities wait to have justice delivered? How many investigations must they suffer before they receive their land back? How many reports need to be published for companies to act?” Madan said. “It’s time AAL’s buyers use their platforms and leverage to push the company to remedy the harm it’s done.”
Company’s response
AAL’s chief executive, Santosa, said the company is now focusing on implementing the recommendations from the verification report.
“We invite and encourage parties who are interested or concerned about solving problems or want to assist the community to be part of this process,” he said. “To continue to provide stakeholders with updates on our ongoing activities, we intend to continue to publish updates regarding this process periodically.”
Zulfahmi said Eco Nusantara and AAL remain open to any NGOs and communities who want to submit evidence or suggestions.
“We believe that what is more important in the future is that the parties need to move forward together to resolve the problems on the ground,” he said. “We also accept that no report will satisfy everyone, but again, we are confident that AAL remains open to looking at any further clear information and evidence that any stakeholder has and commit to doing our utmost to resolve any arising issues.”
Banner image: Palm oil concession of plantation company PT Mamuang, a member of the Astra Agro Lestari group, which is embroiled in land conflict with local communities in Central Sulawesi, Indonesia. Image by Agus Mawan/Mongabay Indonesia.
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