Pasal accused labor m/s 32 fgvsr ,m/s 17,23,82 fgv air

https://www.theedgemarkets.com/article/fgv-disappointed-over-cbp-decision-says-has-
been-taking-steps-2015-address-issues
https://chainreactionresearch.com/the-chain-petition-to-bar-u-s-imports-of-fgvs-palm-oil-
highlights-possible-new-business-risk-for-industry/
https://chainreactionresearch.com/the-chain-fgv-banned-from-selling-products-to-the-
united-states-due-to-ongoing-labor-issues-increasing-reputation-risk/

Solution
https://www.globalbusinessandhumanrights.com/2016/02/16/u-s-congress-finally-
eliminates-the-consumptive-demand-exception/

Desac, R. (2015). FELDA Ventures Holdings Berhad (FGV) Involvement in Cross Border Palm
Oil Plantation Ventures : Challenges and Prospects asu urn ^ ’, Nuarrual Hilal Md ~ a h l a n
Md. 2015(August), 25–26.
Problem:

The FGV Holding Berhad is a well-known company that produce palm oil, rubber plantation
related products, oleochemicals and sugar products. Hence, FGV company might face
several problems during on their business. According to Chain Reaction Research (2020),
United States has banned the FGV from selling their products because of the issues related
to ongoing labor and can increase the reputation risk. According to petition made by Unites
States government, the workers in FGV company are in very bad and poor conditions which
lack of medical and food supply, working in unsafe environment and extreme isolation. In
the other hand, the evidence also found from the investigation made by U.S Customs Border
Protection (CBP) that the FGV company also involved in child labor, physical violence,
abusive working conditions, withholding of identity document and wages. (Chain Reaction
Research, 2019). These kind of problem may critically affect the FGV and produce new risk
in their business because U.S was cutting off their Malaysia’s sixth largest importer of its
palm oil because in America, palm oil plays major part in their economy. Tragically palm oil
produced by FGV using forced labor enters the supply chains of major U.S companies and is
found in their end products.

Furthermore, palm oil plantations and its processing have become a strategic industry for
Southeast Asian countries such as Malaysia and Indonesia. As a result, large-scale land
acquisitions in foreign or neighboring countries in the form of cross-border palm oil
plantation ventures have become necessary. Hence, cross-border palm oil plantation
ventures are undertaken solely for commercial purposes in order to meet global demand for
palm oil. Malaysian Multinational Enterprises (MNEs) involved in cross-border palm oil
plantation ventures and they have to face several of problems. (Desac, 2015). One of the
Malaysian Multinational Enterprises that involve in cross border oil palm plantation is FGV
Holding Berhad. In terms of the opportunities created by large-scale land acquisition, there
is a disparity in bargaining power in cross border palm oil plantation. These can cause
urgent development in rural areas and large scale land acquisitions can be viewed as an
opportunity for increased in agricultural investment due to the urgent need for greater
development in rural areas and the fiscal inability of developing-country governments to
provide the necessary infusion of capital. According to Desac (2015) stated that for some
land agreements in rural areas may cause bad relationship between the local communities
and investors when negotiating with the people that supported by local elites. Thus, those
inequality power in bargaining the land acquisition become at risk. These can cause
resettlement and loss trust by the local communities toward the FGV.

Solution:

The solution for the forced labor by the FGV might be they need to be more careful on
taking foreign labor or local labor. Hence, in order strengthen their Group Sustainability
Policy (GSP), they have to adopt the Guidelines and Procedures for the Responsible
Recruitment of Foreign Workers which they can provide clear goal for their responsibility
and ethical recruitment of the foreign workers. Although, several things they should cover
several of recruitment stages or process from pre-employment, employment, and post-
employment processes. Besides, FGV also need to involve their self in Labor Supply Chain
Mapping project in which conducted by International Organization for Migration (IOM) and
Earthworm Foundation which focusing on reviewing the migrant worker recruitment
process, upgrading internal processes and procedures in order to meet international
standards. Furthermore, FGV need to conduct some long-term programme for all the
workers to remove the gaps of FGV in their labor practices. This programme include the
procedures for recruitment, placement, onboarding, along with working and living
conditions and fair wages. Thus, FGV should allocated hundreds of millions of ringgit to
construct new houses and rebuild existing ones in accordance with national standards to
ensure that its workers live in comfortable accommodation.
Next, the solution for the disparity in bargaining power in cross border palm oil plantation
that involve in large-scale land acquisition. This can be solve by doing the properly and
fairly discussion or negotiation between the local communities and the investors which is the
one of stakeholders of the company. Because foreign investment can provide critical
resources for agriculture such as the development of needed infrastructure and the
enhancement of local livelihoods. (Desac, 2015). Thus, the stakeholders are divided into a
lot of groups including the investors, government, employees or workers, non-governmental
organisations (NGOs), supplier, FELDA settlers and regulatory bodies. All of these
stakeholders which involved in cross border palm oil plantation must have a regular meeting
with each other in order to help the local communities to get their rights about the land
because each of the stakeholders have their own duties in the company.