Grievance mechanism: a platform to engage various stakeholderRANesia
A Singaporean palm oil company that has suppliers network in Indonesia, Wilmar International Limited (Wilmar), tries to ensure respect of human rights in its business practice through grievance mechanism. Worker, community, non governmental organization, government, and other stakeholder can use the grievance mechanism when alleged human rights or environmental violations occur in Wilmar’s business operations.
Wilmar has committed to implement No Deforestation, No Peat, and No Exploitation Policy Commitment (NDPE) policy since 2013. Implementing the NDPE policy to more than 1000 suppliers, 238.600 hectares of plantations and 46 Wilmar’s factories need a comprehensive approach.
“We realized that we cannot monitor thousands of our suppliers. Therefore, we created an active platform where grievances can be communicated.” – Siew Wai, Siew Wai Manager of Grievance Procedure at Wilmar
“When we develop our grievance mechanism, we realized that we cannot monitor thousands of our suppliers. Therefore, we created an active platform where grievances can be communicated to Wilmar.” explained Siew Wai, Manager of Wilmar Grievance Procedure.
Wilmar gives responsibility to Grievance Committee, Verification Team, Operational Manager, Procurement Department, and Sustainability Department to follow up grievances and integrate grievances to Wilmar business operations.
“By appointing grievance mechanism team, flow of responsibility to follow-up on grievances become clearer than before.” – Amalia, Indonesian Country Representative of CNV International
“By appointing grievance mechanism team, flow of responsibility to follow up on grievances become clearer than before.” said Amalia, Country Representative of CNV Internationaal in Indonesia.
As the first palm oil company with grievance mechanism, Wilmar had consulted with various NGOs and the Roundtable of Sustainable Palm Oil (RSPO) in designing the mechanism. The grievance mechanism was also adjusted to the accountability standards and transparency of the UN Guiding Principles on Human Rights.
“Wilmar also worked with the Aid Environment and Rainforest Action Network to introduce the grievance mechanism through workshops with 300 local NGOs,” said Siew Wai, Wilmar’s Manager of Wilmar Grievance Procdure.
The development of grievances to Wilmar can be accessed by the public through the website  and annual report. Public can see the development of grievances and Wilmar’s responses through e-mail communication, field verification and resolution activities.
Grievance mechanism complements suppliers’ compliance program
“Although we have tried to assist Wilmar’s suppliers to comply to human rights standard through Aggregator Refinery Transformation (ART) program, campaign from NGO still keeps coming.” said Anselma Faustina, Project Manager of the Earthworm Foundation, a not for profit organisation that consult Wilmar in implementing NDPE policy.
From 51 grievances, business relations with 16 suppliers have been terminated.
“For deforestation cases, we will stop purchasing directly because evidence from satellite is hard to be done and tractors are under full responsibility of companies to be stopped.” said Siew Wai from Wilmar.
However, not all of grievances ended with termination of business relations. Grievance can also be resolved through a prolong suppliers’ assistance program.
“For grievances on alleged social violations, we focus on developing corrective action plan.” explained Siew Wai. “Because exploitation cases involve community on the field. If business relations are terminated abruptly, conflict on the ground can escalate quickly.” she added.
Several stakeholders can sit together in resolving human rights grievances, as seen on the cases below.
“Because exploitation case involves community on the ground. If business relations are terminated abruptly, conflict can escalate on the ground.”
– Siew Wai, Manager of Wilmar Grievance Procedure
Case of labour rights grievance in Riau
On June 12, 2017, the CNV Interational and the Center for Research on Multinational Corporations reported alleged violations of labour rights by PT MSS. Alleged violations include illegal casual daily worker, excessive working hours, salaries below minimum standard, use of child labor, and limited freedom of association.
Wilmar followed up on complaints by providing reports on the results of internal verification on the field . Then the Confederation of Indonesian Prosperous Trade Unions (KSBSI-Hukatan), CNV International, Ministry of Manpower in Bengkalis Regeancy, and MSS company continued to do consultations and trainings on industrial relations.
Now the company is in the process of Collective Bargaining Agreement with workers’ organizations.
Grievance case on labour rights in North Sumatra
In August 2016, Amnesty International report ound allegations of labor rights violations at PT DLI and PT Milano which are Wilmar’s subsidiaries in North Sumatra. Representatives of Wilmar met with Amnesty International in December 2017 to discuss action plans. Wilmar then conducted external assessments with BSR, Roundtable on Sustainable Palm Oil (RSPO), and International Sustainability & Carbon Certification (ISCC) regarding alleged forced labor, lack of Occupational Safety and Hygiene (OSH), and illegal recruitment of casual daily workers.
According to One Year Progress published in 2017, percentage of casual daily workers at PT DLI and PT Milano have decreased 42%.
Source: One Year Progress Wilmar
Wilmar also engaged labor unions to improve labor conditions at PT DLI and PT Milano.
Meeting with Verité team in Indonesia.
“The Collective Labor Agreement between Serbundo and the management of the company has been built for the past 2 years,” said Nurhaimah from Serbundo. “Now we are also working with the management to provide protection for women workers in the future,” Nurhaimah added.
“Supplier companies then speak at supplier forums to share their experiences,” said Siew Wai from Wilmar. “This is a good example. Sometimes not all suppliers feel comfortable talking in front of the suppliers community due to fear of raising the standard too high, ” Siew Wai added.
Initial achievement of a long journey ahead
In the beginning of 2019, dialogue with various stakeholders was held to add some new features to the complaints mechanism.
“NGOs will continue to raise high standards. Wilmar will always be the focus because we are the largest palm oil trader in the world.” – Siew Wai Manager of Grievance Procedure at Wilmar.
“One of the feedbacks from the NGO community is how to provide a grievance mechanism for workers whistleblowers, not just reports from institutions and organizations. The whistleblower can keep his or her identity confidential for safety reasons. ” said Siew Wai, “We will also begin to answer reports of complaints from the media,” she added.
According to Amalia from CNV International, trade unions need to get training to make good complaints.
“CNV International provides training to workers so that all grievances are accompanied by data, if necessary research. Also, it must be clear what standards are being used, the Indonesian Law or RSPO criteria.” explained Amalia from CNV International.
According to Siew Wai, the capacity of the Wilmar team to handle complaints must also continuously be developed. “With increasing transparency, of course feedback and criticism will keep coming. NGOs will continue to raise the standards. Wilmar will always be the focus because we are the largest palm oil trader in the world, “said Siew Wai from Wilmar.
“We will continue to set the best standards for the palm oil industry so that others can follow.” ensured Siew Wai.
“We will continue to set the best standards for the palm oil industry so that others can follow.” ensured Siew Wai. – Siew Wai Manager of Grievance Procedure at Wilmar.
About Wilmar International Limited
Wilmar International is a public agribusiness company in Singapore. Wilmar’s business activities include oil palm plantations, refining, trading and distribution of palm oil. Wilmar is recognized as the world’s largest trader in palm oil industry, controlling around 45% of global trade.
- Amalia Falah Alam – Country Representative of CNV International
- Janhavi Naidu dan Anselma Faustina – The Earthworm Foundation
- Nurhaimah – Serbundo
- Siew Wai Loo – Grievance Mechanism Manager of Wilmar International Limited
Note: This story captures experiences and opinions from various perspectives on a particular situation, and is designed to share lessons learned on some of the issues involved. It is not intended to be a comprehensive case study nor does it claim to give a definitive account of a specific case or perspectives on that case.