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To safeguard the environment, we consider the impact our operations have by managing our energy use, water consumption, waste production as well as implementing good agricultural practices.


To be recognised as a leader in sustainable palm oil production, the Group strives to safeguard our overall environmental performance throughout our supply chain. We prioritise continuous improvement, investing efforts in sustainable development and innovative technology that are geared towards protecting and conserving the environment through sound energy, water and waste management. Our SQD also focuses their resources to introduce initiatives and targets that are aimed to reduce our carbon footprint in an attempt to mitigate climate change.


PROTECTING OUR PLANET 

The relationship between the business world and the planet that sustains it has undergone profound changes. Pollution, climate change and natural have come to a point where the human race has to step up to the plate and take concerted actions to save our planet.




CONSERVING BIODIVERSITY

Kulim is well aware of the essential role it plays in protecting biodiversity and maintaining natural habitats. Our plantations in Johor border the Endau-Rompin National Park and the Labis Forest Reserve. The last survey to assess the state of the flora and fauna bordering our estates was conducted in 2008. According to the International Union for Conservation of Nature (“IUCN”), the biodiversity of wildlife on its Red List of Threatened Species has become even more precarious. Hence, Kulim has stepped up its efforts by working closely with Government and Non-Governmental Organisations (“NGOs”) to strengthen its internal monitoring and control mechanisms to mitigate incidents of poaching.


HIGH CONVERSATION VALUE (“HCV”)

Tools The RSPO is committed to deploying HCV tools within the context of sustainably managed landscape through the RSPO Principles and Criteria. There are various HCV definitions, including endemic, rare, threatened or endangered species. Kulim’s man made reservoir has become a haven for a variety of wildlife, including two (2) species of migratory birds recorded by the Wildlife Conservation Society that come under the HCV category. 


SAVING OUR NATURAL HERITAGE

Kulim is committed to protect the national biodiversity and endangered species. From time-to-time, incidences of human elephant conflict have been reported at the Sungai Tawing, Siang,Sindora and Tunjuk Laut Estate. In 2018, 48 incidences of elephant encroachment were reported. A more serious growing problem is that of elephants encroaching into residential areas, as a result of increasing activities at the surrounding estates.


In this regard, we continue to collaborate with the Wildlife Conservation Society to consider a permanent solution to the encroachment problem. The Group is determined to put a stop to animal poaching and we are also striving for biodiversity conservation. To this end our Kulim Wildlife Defenders (“KWD”) have joined forces with the Johor National Parks Corporation,Wildlife Department, Forestry Department and the Police Force under the Johor Wildlife Conservation Project to save our natural heritage. A total of ten (10) programmes were conducted in 2018 at different locations in Johor, as follows:

 

 

No Month Location
1. January Hutan Simpan Daerah Kota Tinggi
2. March Hutan Simpan Labis, Segamat
3. May Hutan Simpan Daerah Kluang
4. June Hutan Simpan Labis, Segamat
5. July Hutan Simpan Labis, Segamat
6. August Hutan Simpan Labis, Segamat
7. September Hutan Simpan Daerah Kota Tinggi
8. October Hutan Simpan Daerah Kota Tinggi
9. November Hutan Simpan Daerah Kluang
10. December Hutan Simpan Daerah Kluang

RAJA ZARITH SOFIAH WILDLIFE DEFENDERSCHALLENGE 2018

Raja Zarith Sofiah Wildlife Defenders Challenge (“RZSWDC”) programme is a competition programme aimed at being an initiative, which will have a prolonged impact on wildlife conservation and environmental preservation, especially in Johor. 

The idea of DYMM Tuanku Permaisuri Johor, Raja Zarith Sofiah, this biennial programme, began in 2013, with the theme “Wildlife Conservation, followed by 2016 with the theme “Human and Mangrove Toward Life of Symbiosis” and the theme for 2018 is “Johor Mighty Rivers”. 

JCorp as well as strategic partners of Kulim and Johor Land Berhad, in collaboration with government agencies such as Department of Educational, Department of Irrigation and Drainage, Department of Environment, Department of Wildlife and National Parks, Forestry Department, and Non-Government agencies such as the Malaysian Nature Society Johor Parks (Perbadanan Taman Negara Johor), and Indah Water Konsortium (“IWK”). The closing ceremony of RZSWDC 2018 was held at Thistle Hotel, Johor Bahru on 18 November 2018. 

In the effort of creating awareness to the public on the importance of protecting the wildlife, Kulim Wildlife Defenders (“KWD”) has participated in several events among others are in conjunction with the World Wildlife Day 2018, organised by Department of Wildlife and National Park at Dataran Tangkak, Johor, KWD on 01 April 2018.

Kulim had on 1 April 2018 participated and was the main sponsor of Pertandingan Kreatif Tabika Perpaduan Daerah Kluang 2018 with the theme “Saving Wildlife”. Total of 6,000 Tabika students from Kluang district, was participated in 3 contests such as colouring, collage and animal replicas, organised by KWD.


ENHANCING BIODIVERSITY AREAS

As at 31 December 2018, Kulim has set aside 18.45 hectares of land for buffer zones, while another 51.65 hectares of jungle patches within our estates will be preserved as full-fledged HCV forests. Six (6) years ago, Kulim launched the National Corridor Initiative linking natural habitats that have been separated by human-modified landscapes. These corridors are critical for the maintenance of ecological processes, among the most important being, it facilitates the free movement of animals and the continuation of viable populations. To create these natural corridors, we have organised an annual tree planting event, Infaq 1 Warisan, which brings together employees as well as members of the public to play their part in enhancing the biodiversity in our estates. 

MITIGATING IMPACTS

Kulim acknowledges the fact that the establishment of monoculture oil palm plantations has a number of environmental impacts. Among the most serious are the large-scale conversion of forests to plantation, loss of critical habitat for endangered species, soil, air and water pollution, as well as possible social impact on the livelihood of local communities are affected. The Group has therefore initiated several measures to mitigate the negative impacts of its operations:

1. All our estates are required to provide regular updates on the species found in and around the estates and track incidents of wildlife encroachment, particularly elephants. 2. Buffer zones have been established at major water bodies in or around the estates and adjacent to forest reserves. Regular Rapid Biodiversity Monitoring is conducted in identified hotspot areas within the vicinity of our operating units. Any encroachment by intruders into these conservation areas or hotspots is closely monitored
3.To minimise soil erosion, our roads have been realigned and silt traps have been constructed at appropriate locations. We have also planted soft grasses, mucuna and natural cover crops for young palms. In areas where erosion is severe, we have encouraged the planting of vertivar and Guatemala grass to minimise soil erosion. 4. Hunting, fishing and taking of fauna within our estates and adjacent protected areas are strictly prohibited.

The Group’s Environmental and Biodiversity Unit serves as a point of reference for all matters concerning environmental issues, notably in the areas of biodiversity protection and pollution control. The unit collates and analyses environmental and wildlife data, publishing its findings and outcomes in environment and biodiversity bulletins. 


BEYOND OUR ESTATE BOUNDARIES

Our work in biodiversity conservation sometimes extends beyond the boundaries of the Group’s estates. Incidents of human-wildlife  encounters happen occasionally, as when elephants encroached into Siang Estate, Enggang Estate, Sungai Tawing Estate, Tereh Utara Estate, Bukit Payung Estate, Pasir Logok Estate, Tunjuk Laut Estate and Selai Estate. The incursion into the eight (8) estates incurred damage estimated approximately of RM1,989,690. We work closely with the Wildlife Conservation Society (“WCS”) and the Johor Department of Wildlife to mitigate the possibilities of human-wildlife conflicts. In our efforts to find a solution to the problem, we also participated in dialogues and meetings with the State Government and out growers.

Water Conservation In Kulim’s updated materiality matrix, water usage by the Group’s estates and mills and the risk of chemical contamination were among the primary concerns raised by our stakeholders.


In 2018, the Group’s water consumption decreased slightly to 1.10 m3 per tonne FFB from 1.17 m3 per tonne FFB recorded the previous year.The drop was due to the recycling of steriliser condensates for use in mill operations. Water is mainly used to maintain our nurseries or for domestic consumption. To ensure that the processed water that is supplied to our workers is safe for consumption, water quality is closely monitored to ensure it meets the parameters set by the National Water Services Commission (“SPAN”).


ERODED SOIL PARTICLES

Soil erosion can be a major contaminant of our waterways and as a standard operating practice, fast-growing leguminous cover crops are planted in erosion-prone areas. Extensive use of chemical fertilisers will also pollute rivers and underground water sources.To reduce pollution from heavy metals and wherever feasible, the Group has combined inorganic with organic fertilizers derived from Empty Fruit Bunches (“EFB”), a waste product from the milling process.

The utilisation of effluents for land application has raised concern over the Biological Oxygen Demand (“BOD”) levels. BOD is the amount of dissolved oxygen needed by aerobic biological organisms in the oxidation of organic matter. The average BOD from our mill effluents has decreased by 8% compared to 2017. This is due to the completion of biogas plant at Sindora Mill and polishing plant in 2018, and all palm oil mills have been carried out desludging activity as required by DOE in Jadual Pematuhan. 

The Group has a growing Agrofood business and as at 31 December 2018, we had a total cattle population of 6,479 heads. We are closely monitoring the problems associated with cattle rearing,which include soil compaction, over-grazing and soil erosion. Going forward, the challenge is to ensure that our business targets are inline with Good Agricultural Practices.


REDUCING CHEMICAL USAGE

Waterways are also contaminated by the use of chemicals such as pesticides and herbicides. Kulim has long endeavored to find an alternative to pesticides and in 2008, we introduced cattle rearing as a natural weeding program to reduce the use of chemicals. In lieu of pesticides, we have also adopted Integrated Pest Management (“IPM”) techniques to control pests, diseases, weeds and invasive species introduced to the environment. IPM techniques include the use of barn owls, which are part of our efforts to control the rodent population.

Paraquat has been banned or its use disallowed in 32 countries, mainly for health reasons. The herbicide is acutely toxic and corrosive.Apart from causing health problems, paraquat is not readily biodegradable and has the potential to contaminate groundwater. The RSPO has commissioned a study on Integrated weed Management and Alternatives to Paraquat and we are closely following the developments on this matter.

MINIMISING SOLID WASTE

Standard operating procedures are in place for the disposal of solid waste. EFB is used as biocompost, while more than half of the palm fibers and shell produced by our estates are used as biomass in milling operations. The remaining palm fibers are used as biocompost while the shells are sold. A small amount of boiler ash is produced when palm fibers and shell are burned and this is recycled into the soil to reduce acidity levels. An authorised agent has been appointed to transport the small amounts of hazardous scheduled waste for safe disposal at designated facilities.

ADDRESSING CLIMATE CHANGE

At the Paris Summit in December 2015, 196 countries met to sign a new climate change agreement. Despite the United States’ rejection of the Paris climate accord, world leaders again gathered in Paris in December 2017 to give new momentum in the fight against global warming.

A strong climate agreement is needed to protect the planet’s ecosystems and biodiversity. According to the Intergovernmental Panel on Climate Change, key GHGs in the atmosphere have reached unprecedented levels; heat waves will occur more frequently and for extended periods; the oceans will continue to warm and acidify, while sea levels are predicted to continue to rise due to increased melting of land based ice such as glaciers and ice sheets. Climate change will amplify existing risks and create new ones for natural and human systems.

A report by the National Oceanic and Atmospheric Administration (“NOAA”) showed that the global surface temperature in 2016 was the highest ever since record-keeping began in 1880, raising new concerns about the accelerating pace of climate change. The temperature changes are largely driven by increased carbon dioxide level and other human-made emissions into the atmosphere. In December 2015,Malaysia submitted its action plan to the UN Framework Convention on Climate Change (“UNFCC”), pledging to reduce its GHG emissions by 45% by the year 2030. On our part, the RSPO Principles and Criteria requires oil palm growers to monitor, manage and educe GHG emissions across their entire operations.

BIOGAS PLANT

The Group is establishing biogas facilities using methane capture technologies to convert Palm Oil Mill Effluents (“POME”) to electricity. Three (3) plants have already been commissioned at Sedenak, Sindora and the Pasir Panjang POM.

Kulim has set a target to reduce the Group’s overall carbon footprint to 58% by 2020 and to establish biogas plants at all of its five (5)mills by 2025. The installation of biogas plants at the remaining two (2) POMs are expected to be completed by 2019 to meet the requirements of the DOE. 

CARBON EMISSION BASELINE 

In 2013, Kulim had the distinction of being the first Malaysian plantation company to publish a Carbon Footprint Report using the GHG Beta Version 1a Guidelines. These guidelines were developed with funding from RSPO, to enable palm oil producers to estimate the net GHG emissions produced during palm oil production. 

In November 2016, Palm GHG Version 3.0.1, which is a new and improved version of the guidelines, was released. The new version only needs one (1) year’s data compared to Palm GHG Version 2.1.1 which required an average of 3-year data. Starting from 1 January 2017, the RSPO Palm GHG will be used to calculate GHG emissions from operations, including land use change GHG emissions after November 2005. Public reporting of GHG emissions is mandatory through annual audit summary reports published on RSPO’s website.

In November 2017, Kulim produced its third biennial Carbon Footprint Report for the year 2016 using Palm GHG Version 3.0.1. During the process of producing the report, we have amended our calculation and included the Pasir Panjang POM in the calculation.Our net GHG emissions for 2016 amounted to 422,000 mt CO2e or carbon dioxide equivalent. This is equivalent to 1.23 mt CO2e per mt CPO and PK. For 2017, our GHG emission reduce 15% which is 1.08 mt CO2e per mt CPO and PK. For 2018, we are currently in progress for collecting data to produce the fourth Carbon Report, which is expected to be published in July 2019.

PALM KERNEL SHELLS

Another waste product of our milling operations is Palm Kernel Shells (“PKS”), of which 91,760 tonnes of were produced in 2018. About 79,864 tonnes or 87.04% was used internally for power generation,while 13,516 tonnes were sold for external use as a replacement for fossil fuels. We were able to incorporate a carbon credit of 31,246 tonnes CO2e due to the ongoing tracking and monitoring of PKS that were sold. 

FERTILIZERS REDUCTION

GHG emissions from the production, transportation and use of chemical fertilizers are among the concerns being addressed by Kulim in its efforts to reduce the impact of its operations on the environment. In order to mitigate the excessive use of fertilizers without affecting FFB yields, Kulim has initiated a long-term organic fertilizer program. Collection of field data is underway to optimize the combined use of chemical and organic fertilizers. In addition, all our mills have established composting projects to recycle the nutrients from EFB and POME back to the fields.