KUALA LUMPUR: FGV Holdings Bhd has expressed disappointment with the United States’ move to ban imports of palm oil from the company following an investigation into allegations it uses forced labour.
FGV today stressed that all issues raised had been the subject of public discourse since 2015 and that it had taken several steps to correct the situation.
“FGV’s efforts are well documented and available in the public domain. FGV is disappointed that such decision has been made when FGV has been taking concrete steps over the past several years in demonstrating its commitment to respect human rights and to uphold labour standards,” it said in a statement.
“As mentioned in our statement dated 26 September 2020, various efforts have been carried out by FGV in honouring such commitment,” it added.
The US Customs and Border Protection (CBP) agency reportedly had said on Wednesday the ban was the result of a year-long investigation that revealed signs of forced labour.
This included abuse of the vulnerable, deception, physical and sexual violence, intimidation and threats, and retention of identity documents.
The investigation also raised concerns that forced child labour was potentially being used in FGV’s production processes, CBP said in a statement, adding that the ban would come into effect immediately.
FGV, however, stressed that it had continued to strengthen its procedures and processes in the recruitment of migrant workers.
The company said it had since August last year, been communicating with CBP through its legal counsel and had submitted evidence of compliance of labour standards.
FGV noted that it had established four one-stop centres in Malaysia and in source countries namely in India and Indonesia, as part of its efforts to strengthen the pre-departure and post-arrival orientation programmes for its migrant workers.
“Through these orientation sessions, our migrant workers are briefed on various matters including the terms of their employment, job scope and nature of work, rights and responsibilities, as well as benefits and entitlements.”
FGV has also adopted its Guidelines and Procedures for the Responsible Recruitment of Migrant Workers in 2019 in accordance with international standards and will continue to strengthen the document.
Under the guidelines, FGV is committed to paying official costs associated with the recruitment of migrant workers, which include airfare and costs for work permit, visa, medical check-up and insurance.
FGV has also revised its contract with recruitment agencies to require them to ensure that no fees are charged on the workers.
FGV, the world’s largest crude palm oil producer, denied involvement in any recruitment or employment of refugees.
Effective this year, FGV has recruited its migrant workers mainly from India and Indonesia through legal channels and processes recognised and approved by the authorities of Malaysia and the source countries.
“As of August 2020, FGV has 11,286 Indonesian workers and 4,683 Indian workers, who together, form the majority of FGV’s plantation workforce. Furthermore, FGV does not hire contract workers and all workers are employed directly by FGV.”
FGV said it was pioneering the implementation of the electronic wallet (e-wallet) cashless payroll system for its plantation workers.
The e-wallet system, which gives empowerment to the workers, acts as a more convenient and efficient way for workers to manage their finances, was successfully rolled out since February this year in Gua Musang, Kelantan, involving 1,500 registered users in 11 of its estates.
By the first quarter of 2021, FGV aims to implement this system for its entire plantation sector including estates in Sabah and Sarawak.
The company also said it did not practice the retention of its workers’ passports.
It has installed a total of 32,250 safety boxes throughout all its 68 complexes, as an option for migrant workers to keep their passports safely.
“In fulfilling the rights of workers to adequate housing, FGV has over the past three years, invested about RM350 million to upgrade housing facilities for its workers by constructing new residences in our plantations all over the country.”
It added that it had respected workers’ right to healthcare through the benefits provided, which cover annual expenses for outpatient care and an unlimited allocation for inpatient treatment.
“Mindful that human rights and sustainability standards must be fulfilled throughout our supply chain, FGV has adopted a Supplier Code of Conduct (SCOC), outlining the principles and standards relating to sustainability, business ethics and integrity, safety, health and environment, and labour, with which our suppliers and vendors are required to comply.
“Any supplier or vendor that do not comply with the SCOC will be subjected to FGV’s Supplier Delinquency Guidelines, with the possibility of being suspended or terminated and blacklisted should they fail to demonstrate willingness to rectify gaps in their practices.”
FGV reiterated that it did not tolerate any form of human rights infringements or criminal offense in its operations.
“FGV pays serious attention to any allegation of physical or sexual violence as well as intimidation or threats, and as a responsible company any case of such nature will be acted upon by FGV including by reporting them to the relevant authorities.
“Recognising that respecting human rights is a continuous endeavour, FGV became a participating company of the Fair Labour Association (FLA).”
It is currently implementing a long-term and comprehensive action plan under its affiliation to the FLA that comprises a number of initiatives to further strengthen various aspects of its labour practices.
This includes its recruitment process, human rights training programmes, working and living conditions, as well as grievance mechanisms.
FGV’s action plan for 2020 was adopted on March 31 this year in consultation with the FLA and with various other stakeholders including civil society organisations (CSOs).
“The action plan was adopted at a time when the COVID-19 situation was rapidly worsening globally, including in Malaysia.
“Despite the unprecedented challenges posed by the Covid-19 pandemic, which forced FGV to realign its priorities to ensure that necessary measures are taken to curb and combat the spread of Covid-19, FGV remained committed to implementing the action plan.”
FGV believes that concrete progress has been made in the six months of implementation beginning April.
“FGV is confident that it is on the right track to be able to accomplish the action items due to be completed by the end of 2020. FGV’s affiliation to the FLA is subject to a rigorous validation exercise and public reporting. FLA’s report on FGV’s progress on the implementation of the action plan is published on FLA’s website,” it said.