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SUSTAINABILITY

www.asiapulppaper.com

ROADMAP VISION 2020


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June 2013

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June 2013

Foreword from Aida Greenbury,


Managing Director of Sustainability and Stakeholder Engagement, APP
We launched our Sustainability Roadmap Vision 2020 in June 2012, setting our
company on an ambitious path to embed sustainability at the heart of everything we do.
In February 2013, we announced a new Forest Conservation Policy (FCP), which included
a commitment to an immediate cessation of all natural forest clearance throughout our
entire supply chain.
This third report brings you up to date with the latest developments, including
an absolute deadline of 31 August 2013 for all natural forest wood felled prior to
1 February 2013 to have reached APPs pulp mills. After this date, no natural forest
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concessions in Indonesia.
We are still in the early stages of delivering the FCP and our systems are not yet perfect.
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let me be clear - our commitment to stop natural forest clearance was absolute. There
are no planned exceptions. If an oversight is made during the implementation of FCP, we
will address and use it to strengthen and improve our systems.
We have been engaging and consulting with stakeholders in Indonesia and beyond,
responding to and investigating grievances, and continuing the hard work on the ground
with The Forest Trust (TFT).
This update is published simultaneously with the re-launch of our website,
www.asiapulppaper.com, which contains details of our Sustainability Roadmap and
Forest Conservation Policy. APP is also unveiling a pilot online progress monitoring
system, developed with TFT. This prototype version will be the subject of extensive
consultation in the coming months, to ensure it meets the information and transparency
requirements of our many stakeholders.
As ever, your comments are welcome, and you can send these to
sustainability@app.co.id

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Natural forest wood


acceptance deadline
The Forest Conservation Policy and associated moratorium on natural
forest clearance that was implemented on February 1st 2013 generated a
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respondents highlighted that there is a need to establish an absolute
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February 1st into APP mills.

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August 31st 2013 established as deadline


to stop receiving any natural forest wood cut
prior to implementation of the Forest Conservation Policy.

In response to this feedback, APP has set an absolute deadline of August


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log yards.
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all APP land concessions in Indonesia. The assessments are set to be
completed early next year, and are being undertaken by TFT and
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concessions contain natural forest, all of which will be protected.
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DVSDUWRIWKH,QGHSHQGHQW2EVHUYHU ,2 SURJUDPPH

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Progress of Forest Conservation


Policy Commitment

The FCP has four components:


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+&9 DQG+LJK&DUERQ6WRFN +&6 IRUHVWV
2. Best practice peatland management
3. Social and community engagement
4. Ensuring compliance from third party suppliers

APP and its suppliers will only develop areas that are not forested,
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[1.1. No Deforestation policy ]
With the launch of APPs No Deforestation policy, APP suppliers implemented
a moratorium on natural forest clearance effective February 1st 2013.
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XQGHUWDNHQ$OOQDWXUDOIRUHVWVLGHQWLHGE\WKHVHDVVHVPHQWVZLOOEHSURWHFWHG
The moratorium remains in place.
A grievance protocol has been implemented to open communication with
stakeholders regarding FCP and to ensure problems can be dealt with effectively.
The procedure has been successfully deployed on six occasions raised by
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investigated and resolved, one requires a longer-term investigation, and we are
currently examining a sixth.
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Fibre Procurement & Processing Policy and the Forest Conservation Policy using
a score card system. Action has been taken in one case, where a tier two supplier
was delisted for operating in breach of APPs Forest Conservation Policy
commitments.
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&RQVXOWDQWVWRXQGHUWDNHWKH+&9DVVHVVPHQWV
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27 concessions, due for completion in Q2 2014.
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This data was fully processed in March - April 2013, and the team is conducting
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+&6DVVHVVPHQWVIRUWKHUVWFRQFHVVLRQVZLOOEHFRPSOHWHGE\4
The remaining 20 will be completed in early 2014.
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the end of the Q1 2014.

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Figure 1.

Figure 3.

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Figure 2.
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June 2013

[ 1.3 Transparency ]
The new Forest Conservation Policy has been shared with local stakeholder
groups in Indonesia through a series of Focus Group Discussions (FGDs)
in February and March 2013.
The aim of the FGDs and sharing sessions was to explain the content of the
new FCP, to seek feedback on the draft FCP implementation protocols and to
invite the active participation of Indonesian civil society in the implementation
and monitoring process.
The inputs received from those discussions have been used to enhance APPs
FCP implementation protocols.

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Figure 4.
Focus Group Discussions Chronology

Case study on issues submitted through grievance:

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in February and March 2013. They were attended by over 50 participants
from civil society and the academic community.

Report on potential breach of moratorium by


two APP suppliers in West Kalimantan.

APP has also unveiled a pilot online monitoring dashboard, which gives access
to up-to-date technical information relating to the implementation of the FCP.
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to review current progress on the ground and to see moratorium boundary
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APP will be consulting with its stakeholders on the format and content of the
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As a result of learnings from grievances received, APP has introduced a risk
assessment project team responsible for identifying, reporting and addressing
any potential future issues in the FCP implementation process. The team will
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LVVXHVZKLFKIDOOZLWKLQRXULQXHQFHZLOOEHDGGUHVVHGSURSHUO\IROORZLQJHOG
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Issue:
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were actively clearing forest in breach of the FCP moratorium.
Action:
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to check the situation on the ground.
Findings:
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not by APP or either of its two suppliers. Rather, companies with concessions
overlapping the APP suppliers concessions were carrying out the forest clearance.
Improvement actions:
APP has raised this issue with the respective companies and with the local and national
government.
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FRQFHVVLRQKROGHUVDQGWKHORFDODXWKRULWLHV7KLVZLOODOORZDIROORZXSYHULFDWLRQ
process. In addition, TFT and APP are currently mapping all possible license or other
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government authorities.

Report on potential breach of moratorium by


APP supplier in Riau.
Issue:
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undertaken by an APP supplier in Riau, PT RIA, after February 1st, in breach of the
moratorium.
Action:
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DORFDO1*2WRFKHFNWKHVLWXDWLRQRQWKHJURXQG$QDHULDOVXUYHLOODQFHH[SHGLWLRQ
took place on May 29.
Findings:
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in 2011, been allocated for community livelihoods an obligation of concession owners.
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,QGHSHQGHQW2EVHUYHUSURJUDPPHDHULDOVXUYHLOODQFHLQPLG$SULO
Improvement actions:
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as the investigation is completed. APP has introduced a risk assesment project team
responsible for identifying, reporting and addressing any potential future issues
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RI$33V)*'V:HZLOOHQVXUHWKDWDQ\VXFKLVVXHVZKLFKIDOOZLWKLQRXULQXHQFHZLOO
EHDGGUHVVHGDSSURSULDWHO\IROORZLQJHOGYHULFDWLRQDQGVWDNHKROGHUFRQVXOWDWLRQ

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[ 1.4. Natural Forest Wood Monitoring ]


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accepting natural forest wood felled prior to February 1st. In response, APP has
now issued an absolute cut-off date of 31st August 2013 for accepting natural
forest wood.
To ensure compliance, APP and TFT have developed an inventory monitoring
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system enables the movement of natural forest wood cut prior to February 1st
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APP has inventoried and mapped the location of all stocks of natural forest logs
within its supply chain cut before the moratorium.
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,QGDK.LDW3HUDZDQJ ,.3 PLOOLQ5LDX$33VRWKHUSXOSPLOOWKH/RQWDU3DS\UXV
mill, is no longer accepting natural forest wood.
As of May 19th 2013, approximately 27% of this stock had arrived at APPs
IKP mill in Riau.

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Figure 5.

Natural Forest Wood Monitoring

June 2013

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[ 1.5. Third-Party Monitoring ]


To support supplier adherence and third party observer monitoring, APP and
TFT have developed a draft detailed set of protocols:
- Moratorium on Natural Forest Clearance
- Monitoring Implementation of FCP
- Grievance Protocol
- New Area Development
The protocols are designed to be living documents, and are open to constant
improvement through discussion with all stakeholders. Input on these protocols
has been sought from regional, national and international civil society groups
through the FCP sharing sessions, Focus Group Discussions and direct discussions.
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)&3LPSOHPHQWDWLRQPRQLWRULQJSURJUDP,2VFRPSULVHGRIORFDO1*2V
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the last Focus Group Discussion held in Jakarta on March 27th.
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entering the mill.
APP has established a team to ensure the grievance protocol is properly
implemented. The protocol has proved effective and it has handled
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Riau, and Kalimantan.

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2.

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APP will support the Government of Indonesias low emission


development goal and its target to reduce greenhouse gas emissions.
This will be achieved by ensuring that forested peatland is protected
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EHVWSUDFWLFHPDQDJHPHQWWRUHGXFHDQGDYRLG*+*HPLVVLRQVZLWKLQ
the peatland landscape.

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and a Peat Management Plan. Together these Plans will form part of APPs
Sustainable Forest Management Plan (SFMP). The Peat Management Plan
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landscape.
APP will establish its own peat management team, to include external experts
in peat soil science and hydrology.
No further canal or other infrastructure activities will take place within
undeveloped suppliers concessions on non-forested peatland until
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3.

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APP will actively seek and incorporate input and feedback from
a wide range of stakeholders and civil society on a number of
social policies and procedures.

[3.1. Policies and procedures ]


APP has developed a number of procedures and protocols to handle social
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lessons are learnt from on-the-ground implementation.They include:
- 5HVSRQVLEOH&RQLFW5HVROXWLRQ3URFHGXUH
- &ROODERUDWLYH&RQLFW0DQDJHPHQW$SSURDFK
- Free Prior and Informed Consent (FPIC)
- Implementation procedure
- APP Grievance Protocol
APP and TFT have sought detailed feedback and input on these social
procedures through the Focus Group Discussions detailed earlier in this report.
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resolution processes and Free, Prior and Informed Consent (FPIC)
implementation.
[3.2. Training ]
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completed in the regions of South Sumatra, Jambi, Riau, West Kalimantan and
East Kalimantan
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teams at APP headquarters.

[3.3 Implementation ]
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WHDPVKDYHXQGHUWDNHQFRQLFWPDSSLQJLQ-DPEL5LDXDQG:HVWDQG(DVW
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mapping and will use it as a test case for making adjustments to the training.
 The FPIC Implementation procedure is currently being tested through pilot
projects in Jambi, Riau and South Sumatra provinces. Further FPIC pilot projects
are being considered for other regions.
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Jambi, Riau and South Sumatra using the new social protocols and procedures.
APP and TFT will continue to seek active engagement from all stakeholders in
the resolution process and each case will be used as a learning and capacity
building opportunity.

4.

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to ensure that this sourcing supports responsible forest management.

In March 2013 APP informed its global suppliers that they must comply with
the FCP.
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LQWKHSURFHVVRILGHQWLI\LQJSURJUDPVDQGYLVLWVFKHGXOHVWRHQVXUHWKDWDOOEUH
supplied supports responsible forest management.

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APP continues to make progress rolling out the new Forest


Conservation Policy in China. An internal Action Plan to guide
that rollout has been developed by TFT based on scoping
visits to APP China Forestry (ACF) operations. ACF is currently
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WRUHSRUWDJDLQVWWKHWDUJHWVLQWKHQDOLVHGSODQ
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scorecard performance system developed by TFT. The scorecard performance
system allows APP to measure the performance of suppliers against
international chain of custody best-practices and it is currently in use
throughout APPs Indonesian supply chain.
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UHJDUGLQJSODQWDWLRQGHYHORSPHQWLQ+DLQDQ$VDUHVXOWD+DLQDQ3ODQWDWLRQ
Restoration proposal has been drafted and is now being reviewed by relevant
stakeholders.
TFT is currently preparing the general policy structure for APP China Forestry.
This will allow for the integration of the new Forest Conservation Policy, the
Responsible Fibre Procurement and Processing Policy (RFPPP) and all other
policies related to the environmental, social and economic aspects of sustainable development.
A full gap assessment report of APP China Forestry pulp and paper mills has
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WKHGHYHORSPHQWRIWKH&KLQD$FWLRQ3ODQFXUUHQWO\EHLQJUHYLHZHGDQGQDOL]HG
by APP China Forestry.

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Appendix A
Forest Conservation Policy

June 2013

21

APPs Forest Conservation Policy applies to:


1. APP and all its suppliers in Indonesia.
2. $Q\,QGRQHVLDQEUHXWLOLVHGE\$33VPLOOVHOVHZKHUHLQFOXGLQJ&KLQD
3. All future expansion.

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+LJK&DUERQ6WRFN +&6 )RUHVWV
Policy commitment 1:
APP and its suppliers will only develop areas that are not forested,
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From 1st February 2013 all natural forest clearance has been suspended
ZKLOVW+&9DQG+&6DVVHVVPHQWVDUHFRPSOHWHG1RIXUWKHUFOHDUDQFH
RIDUHDVLGHQWLHGDVIRUHVWZLOOWDNHSODFH
APP has conducted an initial assessment of all of its supply chain.
,WKDVSULRULWLVHG+&9DQG+&6DVVHVVPHQWVLQWKRVHFRQFHVVLRQVWKDW
XSWRQRZKDYHEHHQVXSSO\LQJWKHFRPSDQ\ZLWKQDWXUDOIRUHVWEUH
+&9DQG+&6DUHDVZLOOEHSURWHFWHG
2Q+&6ZRUNKDVVWDUWHGWRLGHQWLI\WKHDUHDDQGTXDOLW\RIIRUHVWFRYHU
6DWHOOLWHDQDO\VLVEDFNHGXSE\HOGZRUNZLOOLGHQWLI\DUHDVWKDWZLOOEH
protected as well as low carbon areas that can be developed as plantations.
7KH+&6DSSURDFKGLVWLQJXLVKHVQDWXUDOIRUHVWIURPGHJUDGHGODQGVZLWKRQO\
small trees, scrub, or grass remaining. It separates vegetation into 6 different
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DQGHOGSORWV7KHVHWKUHVKROGVDUHNQRZQLQ,QGRQHVLDDV+LJK'HQVLW\)RUHVW
+. 0HGLXP'HQVLW\)RUHVW +. /RZ'HQVLW\ROGHUUHJHQHUDWLQJ)RUHVW
+. 2OG6FUXEUHJHQHUDWLQJIRUHVW %7 <RXQJ6FUXE %0 DQG&OHDUHG2SHQ
/DQG /7 $33VWKUHVKROGIRU+&6ZLOOEHGHQHGIROORZLQJHOGDQDO\VLVZLWKLQ
the category referred to as old scrub (BT).

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Any existing natural forest logs within APPs supply chain cut before 1st February
VXFKDVVWRFNVLQORJ\DUGVZLOOEHXWLOLVHGE\LWVPLOOV$Q\EUHFOHDUHGIURP
land which is not forest, such as scrub land, will also be utilised by its pulp mills.
APP will withdraw from all purchase and other agreements with any
supplier who is found not to be in compliance with these commitments.
These commitments are being monitored by The Forest Trust. APP will
welcome independent 3rd party observers to verify the implementation.
Peatland management
Policy commitment 2:
APP will support the Government of Indonesias low emission development goal
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Ensuring that forested peatland is protected as part of its commitment
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%HVWSUDFWLFHPDQDJHPHQWWRUHGXFHDQGDYRLG*+*HPLVVLRQVZLWKLQ
the peatland landscape. As part of achieving this, no further canal
or other infrastructure activities will take place within undeveloped
suppliers concessions on non-forested peatland until independent
+&9DVVHVVPHQWVLQFOXGLQJLQSXWIURPSHDWH[SHUWVKDVEHHQFRPSOHWHG
Social and community engagement
Policy commitment 3:
,QRUGHUWRDYRLGDQGUHVROYHVRFLDOFRQLFWVDFURVVLWVVXSSO\FKDLQ$33ZLOODFWLYHO\
seek and incorporate input and feedback from a wide range of stakeholders,
including civil society, as it implements the following set of principles:

Free, Prior and Informed Consent of indigenous people and local communities
Responsible handling of complaints
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2SHQDQGFRQVWUXFWLYHGLDORJXHZLWKORFDOQDWLRQDODQGLQWHUQDWLRQDOVWDNHKROGHUV
Empowering community development programs
Respecting human rights
Recognising and respecting the rights of its workers
&RPSOLDQFHWRDOOUHOHYDQWODZVDQGLQWHUQDWLRQDOO\DFFHSWHGFHUWLFDWLRQ
principles and criteria

Where new plantations are proposed, APP will respect the rights of indigenous
peoples and local communities, including recognition of customary land rights.
$33KDVFRPPLWWHGWRLQGHSHQGHQW+&9DVVHVVPHQWVDVSDUWRIWKLVFRPPLWPHQWDQG
will, in consultation with stakeholders, develop further measures to implement FPIC.
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international best practice.
Third party suppliers
Policy commitment 4:
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that this sourcing supports responsible forest management.

SRV2020

Appendix B
Protocols and Procedures

June 2013

23

APP, with the support of TFT, has developed the following protocols and procedures.
These protocols are available on the APP website:

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3URWRFROIRU1HZ$UHD'HYHORSPHQW
&RGHRI&RQGXFWIRU0RQLWRULQJWKH,PSOHPHQWDWLRQRIWKH)&3
*ULHYDQFH3URFHGXUHVIRU)&3,PSOHPHQWDWLRQ
&RQLFW5HVROXWLRQ$SSURDFKHVDQG0HWKRGV

For more information on these protocols, please contact APP on


sustainability@app.co.id or visit APPs website www.asiapulppaper.com.

Appendix C
Grievance and monitoring information

APP encourages independent observers and stakeholders to participate in the APP


Grievance and Monitoring via the contact information below:
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Fax: +6221-316 2617
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Email: sustainability@app.co.id

24

SRV2020

June 2013