Civil society calls on BRI, BNI, ICBC and other financiers to cut ties with APP after recurrent community rights violations

On the morning of 4 March 2020, a drone sprayed poison on the rubber trees, food crops, and palm trees of the Lubuk Mandarsah community (Jambi, Indonesia). This poisoning was done in the middle of the COVID-19 crisis, in an area of disputed land, by PT Wirakarya Sakti (WKS), an Asia Pulp and Paper (APP) controlled plantation company, which is in turn the pulp and paper subsidiary of Sinar Mas.

It is not the first violation perpetrated by WKS. In 2015, a farmer union leader, Indra Pelani, who was active in protection community land, was brutally killed by WKS security.

In response to the latest violation, 90 national and international NGOs have published an open letter, calling on financiers and buyers to suspend business with APP and affiliated companies, until it is proven and verified that they have made meaningful changes across their business operations.

The top 5 lenders and underwriters of Sinar Mas’ pulp and paper operations in Southeast Asia, between 2015 and 2019 (August), are the Indonesian based BRI and BNI and the Chinese ICBC, CCB and Hauxi Securities.

BRI, BNI and ICBC all scored zero points in the 2018 assessment of their policies, on Social criteria.

The top 5 investors in Sinar Mas’ pulp and paper division, in 2019, are DFA, Vanguard, BlackRock, GPIF and Deutsche Bank.

Seven years after APP signed a commitment to respect local community rights including Free Prior and Informed Consent principles and to resolve social conflicts, the company is far from being on track to resolve its legacy conflicts and continues to create new violations.

APPs’ financiers on the other hand are also notorious laggards in the implementation of ESG policies and due diligence procedures making them complicit in the violations committed by their clients.

The signatories of the letter call on banks, investors and brands to refrain from conducting business with APP and its affiliated subsidiaries until it is proven and verified that the pulp and paper supplier has made radical changes across their business.