The case for CSR/ Sustainability Reporting Done Responsibly


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Case study: How Apical promotes ethical business behaviour

Apical Group is one the largest exporters of palm oil in Indonesia, managing the downstream business of palm oil production including sourcing, refining, processing, manufacturing, trading, and the distribution of palm oil and its products for the domestic and international markets. Apical is firmly committed to conducting all its business activities with integrity  Tweet This!, and in accordance with strict legal and ethical standards.

This case study is based on the 2019 Sustainability Report by Apical published on the Global Reporting Initiative Sustainability Disclosure Database that can be found at this link. Through all case studies we aim to demonstrate what CSR/ ESG/ sustainability reporting done responsibly means. Essentially, it means: a) identifying a company’s most important impacts on the environment, economy and society, and b) measuring, managing and changing.

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Carrying out its business activities ethically and according to the highest governance standards is a key priority for Apical. In order to promote ethical business behaviour Apical took action to:

  • implement a Code of Conduct
  • apply a robust grievance handling process

What are the material issues the company has identified?

In its 2019 Sustainability Report Apical identified a range of material issues, such as product quality and safety, employee wages and benefits, emissions reduction, community livelihood & empowerment, climate action. Among these, promoting ethical business behaviour stands out as a key material issue for Apical.

Stakeholder engagement in accordance with the GRI Standards             

The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:

“The reporting organization shall identify its stakeholders, and explain how it has responded to their reasonable expectations and interests.”

Stakeholders must be consulted in the process of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.

Key stakeholder groups Apical engages with:

To identify and prioritise material topics Apical engaged with its stakeholders through the following channels:

Stakeholder Group                Method of engagement
Customers &

Consumers

·       One-on-one communication (periodic)

·       Conference calls (regularly)

·       Sustainability Report (annually)

·       Presentations and meetings (ad-hoc)

·       Apical Website (ad-hoc)

·       Apical Sustainability Dashboard (ad-hoc)

·       Survey (periodically)

·       Materiality assessment (every 2-3 years)

·       Consumer Focus Group Discussions

Banks & financial

institutions

·       E-mail updates (regularly)

·       One-on-one meetings (periodic)

·       Sustainability Report (annually)

·       Apical Website (ad-hoc)

·       Apical Sustainability Dashboard (ad-hoc)

·       Survey (periodically)

·       Materiality assessment (every 2-3 years)

·       Site visits (ad-hoc)

Industry groups, trade associations and certification bodies ·       One-on-one Meetings (regularly)

·       Multi-stakeholder forums (regularly)

·       Sustainability Report (annually)

·       Apical Website (ad-hoc)

·       Apical Sustainability Dashboard (ongoing)

·       Survey (periodically)

·       Materiality assessment (every 2-3 years)

·       Multi-stakeholder forums and events (regularly)

Employees ·       Annual appraisals and PRP

·       Townhall meetings (annually)

·       Major festivals celebrations (annually)

·       HR training programmes (ongoing)

·       Apical Website (ad hoc)

·       Apical Sustainability Dashboard (ongoing)

·       Materiality assessment (every 2-3 years)

Local community

 

·       Dialogue with community groups and representatives facilitated by Apical’s dedicated SSL team (regularly)

·       Outreach programmes to improve livelihood (annually)

·       Apical’s grievance mechanism to understand and address community concerns including FPIC and environmental conservation (ongoing)

·       Complaint handling, grievance procedures and conflict resolution engagement (ad hoc)

·       Surveys (periodically)

Governments and regulatory bodies ·       One-on-one meetings (ad hoc)

·       Multi-stakeholder forums and events (regularly)

·       Consultations (regularly)

·       Apical Website (ad hoc)

·       Apical Sustainability Dashboard (ongoing)

·       Materiality assessment (every 2 years)

·       Field visits (regularly)

·       Survey (periodically)

Suppliers including smallholders ·       Anchor Programmes

·       One-on-one communication (ongoing)

·       Apical Website (ad-hoc)

·       Sustainability Report (annually)

·       Apical Sustainability Dashboard (ongoing)

·       Materiality assessment (every 2-3 years)

·       Survey (periodically)

What actions were taken by Apical to promote ethical business behaviour?

In its 2019 Sustainability Report Apical reports that it took the following actions for promoting ethical business behaviour:

  • Implementing a Code of Conduct
  • All members of Apical’s BoD and employees must adhere to the RGE Global Code of Conduct (RGE Code), which is disseminated as part of Apical’s new hire orientation process. The RGE Code guides Apical’s daily business conduct by providing a framework for how Apical should behave in line with its values to achieve sustainable business practices and maintain a strong reputation. Everyone at Apical has a responsibility to report illegal, irregular, dangerous or unethical activities which contravene the RGE Code and related key documents, without the risk of reprisal. As a first point of contact, employees can get in touch with their reporting manager or Human Resources representative. For more severe cases of misconduct, employees may contact the Internal Audit Confidential Hotline. In 2019, there were no cases of breach of the RGE Code, including corruption. There were also no significant fines and non-monetary sanctions for non-compliance with laws and regulations in the environmental, social and economic area. Additionally, Apical complies with the various tax systems that the Group operates in (Indonesia, Singapore, Malaysia, Spain, China etc). Apical carries out monthly tax reviews to make sure all key tax positions such as transfer pricing, cross border transactions, tax compliance and tax planning decisions are taken. Key decisions for tax matters are undertaken collectively between the Group and the corporate office tax team, to ensure checks and balances.
  • Applying a robust grievance handling process
  • To make sure that the standards set out in its policies are being adhered to, Apical has set up a robust grievance handling process for all stakeholders to raise concerns related to Apical’s business or suppliers. All grievances raised are dealt with in a transparent and accountable manner. The grievance process is managed and implemented by Apical’s Grievance Steering Committee (GSC), Grievance Secretariat, Stakeholder Engagement Team and Verification Team. The Apical Grievance Procedure covers all activities related to the management of stakeholders’ concerns. Apical’s grievance process includes a whistleblowing channel and a Grievance Alert System that delivers prompt notifications on matters raised against Apical or its In 2019, there were 22 grievances raised against Apical’s suppliers, which were related to the clearing of forest and peatland areas. Apart from grievances tracked at group-level, each refinery also has their own grievance management process.

Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?

The GRI Standards addressed in this case are:

1) Disclosure 205-3 Confirmed incidents of corruption and actions taken

2) Disclosure 419-1 Non-compliance with laws and regulations in the social and economic area

 

Disclosure 205-3 Confirmed incidents of corruption and actions taken corresponds to:

  • Targets: 16.5

Disclosure 419-1 Non-compliance with laws and regulations in the social and economic area corresponds to:

 

80% of the world’s 250 largest companies report in accordance with the GRI Standards

SustainCase was primarily created to demonstrate, through case studies, the importance of dealing with a company’s most important impacts in a structured way, with use of the GRI Standards. To show how today’s best-run companies are achieving economic, social and environmental success – and how you can too.

Research by well-recognised institutions is clearly proving that responsible companies can look to the future with optimism.



FBRH GRI Standards Certified, IEMA & CIM recognised Sustainability Course | Venue: London LSE

By registering for the next 2-day FBRH GRI Standards Certified, IEMA & CIM recognised course you will be taking the first step in gaining the many benefits of sustainability reporting.

Most importantly, you will gain the knowledge to use the GRI Standards, project manage your own first-class sustainability report and:

  • Identify your most important impacts on the Environment, Economy and Society
  • Begin taking solid, focused, all-round sustainability action ASAP

 

References:

1) This case study is based on published information by Apical, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original, please revert to the original on the Global Reporting Initiative’s Sustainability Disclosure Database at the link:

http://database.globalreporting.org/

2) https://www.globalreporting.org/standards/gri-standards-download-center/

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