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Kulim has long taken measures to mitigate our impact to the environment by responsibly 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 prioritize 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, global heating and deforestation have reached a tipping point. Therefore, it is up to the human race to step up to the plate and take concerted actions to save our planet.

CONSERVING BIODIVERSITY

Kulim’s 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 number wildlife on its Red List of Threatened Species has risen. Hence, Kulim has stepped up its conservation efforts by working closely with Government and Non-Governmental Organizations (“NGOs”) to strengthen its internal monitoring and control mechanisms to mitigate incidents of poaching.

HIGH CONSERVATION VALUE (“HCV”) TOOLS

The RSPO is committed to deploying HCV tools in order to maintain sustainably managed landscapes through the RSPO Principles and Criteria. There are various HCV
definitions, including endemic, rare, threatened or endangered species. Kulim has built a reservoir which has become a haven for a variety of wildlife, including two (2) species of migratory birds that fall under the HCV category.

SAVING OUR NATURAL HERITAGE

Kulim champions efforts to protect Malaysia’s rich biodiversity as well as its endangered species. In 2019, 61 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.

Acting in the interest of everyone involved, we continue to collaborate with the Wildlife Conservation Society to reach a permanent solution to the encroachment problem. 

The Group places a great deal of importance on conservation and is determined to put a stop to animal poaching. To this end, our 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 eight (8) programmes were conducted in 2019 at different locations in Johor, as follows:

 

 

In an effort to create public awareness of the importance of protecting the nation’s wildlife, KWD has also participated in several other events, including Program Kesedaran Pemuliharaan Hidupan Liar dan Alam Sekitar, organised by Wildlife Conservation Society (“WCS”) at SK Kg Peta on 16 July 2019 and at SK Kg Kudong on 23 July 2019. In addition, KWD participated in Program Penghijauan Kawasan Tersorot, organised by Suruhanjaya Pencegahan Rasuah Malaysia and WCS Malaysia at Pantai Gunung Arung, Mersing, on 8 September 2019.

KWD Awareness programmes for students were also organised. Among others, the Summer Camp KMB 2019 at Savanna Hill Resort for students who were preparing for their UPSR, PT3 and SPM examinations. 

ENHANCING BIODIVERSITY AREAS

As of 31 December 2019, Kulim has set aside 59.08 hectares of land for buffer zones, while another 305.74 hectares of jungle patches within our estates will be preserved as full-fledged HCV forests. 

In addition, seven (7) years ago, Kulim launched the National Corridor Initiative linking natural habitats that have been separated by humanmodified landscapes.

These corridors are critical for the maintenance of ecological processes. Among their many benefits, the corridors facilitate the free movement of animals and the ontinuation of viable populations.

To create these natural corridors, we 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

Inevitably, the establishment of monoculture oil palm plantations leaves a deep footprint on the environment. Among the most serious repercussions are, loss of large areas of indigenous forests when they are converted into plantations loss of critical habitat for endangered species, soil, air and water pollution and threats to the safety, culture and livelihood of local communities. 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 environmental matters, especially when it comes 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. In 2019, elephants encroached into Selai Estate, Mutiara Estate, Sungai Tawing Estate, Tunjuk Laut Estate, Bukit Payung Estate, Enggang Estate, Siang Estate, REM Estate, Pasak Estate, Pasir Panjang Estate and Bukit Kelompok Estate. The incursion into the 11 estates incurred damage estimated at approximately RM1,469,562.01. To protect the interests of both people and wildlife, we work closely with the WCS and the Johor Department of Wildlife. In our efforts to find a solution to the problem, we also participated in dialogues and meetings with the State Government and outgrowers.

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 2019, the Group’s water consumption decreased slightly to 1.07 m3 per tonne FFB from 1.10 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 1.5% compared to 2018. This is due to the completion of biogas plant at Sindora POM and polishing plant in 2019, 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 2019, we had a total cattle population of 6,024 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 in line 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.

BIOGAS PLANT

The Group is establishing biogas facilities using methane capture technologies to convert Palm Oil Mill Effluents (“POME”) to electricity. Four (4) plants have already been commissioned at Sedenak POM, Sindora POM, Pasir Panjang POM and the latest Palong Cocoa POM. Kulim has set a target to reduce the Group’s overall carbon footprint to 50%(1) by 2025. The installation of biogas plants at the remaining Tereh POM are expected to be completed by June 2020 in order to meet the requirements of the DOE. This puts us well on track to achieve our target of having fully operational biogas capture facilities at 100% of Kulim mills by 2025.

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. Public  eporting of GHG emissions is mandatory through annual audit summary reports published on RSPO’s website.

Kulim is committed in our continuous effort to implement new and strategic initiatives while achieving sustainable The formula behind the PalmGHG Calculator has been updated several times since the launch of Version 1 in 2012. Version 2.1.1 (“V2”) was released 

in 2014 with significant changes to the categorisation of previous land uses and default values. A further update to Version 3 in 2016 brought additional changes in default values. The latest iteration of the tool, PalmGHG Version 4 was released in December 2018 with a 12-month transition period. 

In November 2019, Kulim produced its fourth biennial Carbon Footprint report for the year 2018 using PalmGHG V3. This has enabled us to make reliable data comparisons on our emissions performance from 2015 to 2018. Earlier methodological changes (particularly between VI and V3) means that data from our 2012-2014 reporting period are not comparable. Our net emissions have decreased by an average of 1.85% annually over the past four years – from just over 421,000 MT CO2e in 2015, to 390,000 MT CO2e in 2018. 

Our carbon footprint per tonne of product also trended down over the same period, from 1.13 MT CO2e in 2015, to 1.01 MT CO2e in 2018. This represents a 20% reduction from our 2012 base year figure of 1.26 MT CO2e per MT CPO/PK.

PALM KERNEL SHELLS

Another waste product of our milling operations is Palm Kernel Shells (“PKS”), of which 90,912 tonnes of were produced in 2019. The total of 73,250 tonnes or 80.57% was used internally for power generation, while 17,662 tonnes were sold for external use as a replacement for fossil fuels. 

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.