Palm Oil Giant Kuala Lumpur Kepong Berhad (KLK) Plagued By Ongoing Conflict and Exploitation, New Progress Report Finds

A new report released today by Rainforest Action Network (RAN) exposes several cases of ongoing Conflict Palm Oil production in Malaysian palm oil giant Kuala Lumpur Kepong Berhad (KLK) global operations. The RAN report--titled Conflict Palm Oil in Practice, Exposing KLK's Role in Rainforest Destruction, Land Grabbing, and Child Labor: 2015 Status Report and Customer Briefing--cites evidence of ongoing conflict with communities in Liberia, threatened social conflict and deforestation in Papua New Guinea, and unresolved labor and deforestation risks in its Indonesian and global operations. The report highlights KLK customers and financiers--Cargill, Unilever, Procter & Gamble, Wilmar, California Oils, Neste, BASF, Fuji Oils, HSBC, OCBC, CIMB Bank, and Maybank--and outlines the requirements that they must set for KLK to resolve these Conflict Palm Oil cases.

"Enough is enough. The Jogbahn Clan of Grand Bassa County, Liberia, has been protesting KLK and its majority owned Equatorial Palm Oil's presence on their customary lands since 2013," said Silas Kpanan'Ayoung Siakor, campaigner for the Sustainable Development Institute/Friends of the Earth Liberia. "It is past time that KLK and EPO's buyers and financiers get serious about their commitments to sourcing and financing responsible palm oil and require that KLK and EPO formally recognize and excise the communities' land claims without delay."

Many of KLK's customers and financiers--including Unilever, Procter & Gamble, Cargill, Wilmar, and HSBC--have their own responsible palm oil policies mandating that the companies they provide financing to and from which they buy palm oil do not contribute to deforestation, expansion on carbon-rich peatlands, or the violation of human and workers' rights. Published a year and a half after RAN first exposed KLK's Conflict Palm Oil practices in its initial report on the company, and a year after KLK's release of its own Sustainability Policy, this latest report sets a six month timeline for KLK to resolve these cases to the satisfaction of affected communities and stakeholders, and if the company does not, the report calls on KLK's customers and financiers to cut all ties with KLK.

"Due to the complicity of its customers and financiers, KLK is getting away with violating communities' right to Free, Prior Informed Consent, provoking social conflict, using forced labor and child labor, and making a weak no deforestation commitment," said Robin Averbeck, senior campaigner for Rainforest Action Network. "While paper commitments to responsible palm oil sourcing and financing are growing exponentially, real supply chain actions to force reforms and cut bad actors remain few and far between. Words without action are no longer acceptable."

By area, KLK is the world's fifth-largest palm oil plantation company with a land bank of nearly 250,000 hectares in Indonesia and Malaysia. In December 2012, as part of its global expansion ambitions, KLK acquired a majority interest in a Papua New Guinean company claiming user rights over 40,000 hectares of land in the Collingwood Bay region--home to nine Indigenous tribes who have a long history of publicly opposing logging and palm oil operations on their lands. In what has become a high profile international case, the communities fought KLK's planned expansion through the National Court of Papua New, through a formal RSPO complaint and through contacting KLK's financiers and customers, and in May 2014, KLK lost two of three leases of its three leases through the court case.

"The people of Collingwood Bay have spoken clearly through the voices of our chiefs that we are against large scale palm oil development on our lands and we are against KLK," said Lester Seri, a landowner in Collingwood Bay Papua New Guinea, another community fighting expansion by KLK. "A year and a half ago, the National Court of PNG revoked two of KLK's three land permits in Collingwood Bay, but the company has refused to surrender its third lease and move its machinery out of the area. KLK's presence is stirring social conflict and any palm oil development in Collingwood Bay would result in the logging of primary rainforests. We call on KLK's customers and financiers to demand that KLK leave Collingwood Bay immediately and not return."