Risk Assessment of Our Mills
To ensure the implementation of NDPE by each supplier, a Monitoring, Reporting, and Verification (MRV) process is conducted. This is the final step that determines whether the supplier meets NDPE requirements. MRV is conducted by the Supplier Audit Team, selecting a sample of farmers proportional to the number of farmers per supplier. Sampling is conducted in accordance with the ISO 19011 Management System Audit sampling standard.
The NDPE implementation process for suppliers begins with the completion of a registration form and the signing of a statement of agreement to the Code of Ethics and NDPE policies by both the supplier and the supplying farmers. This is the initial step to ensure that all parties involved in the supply chain are clearly identified. Suppliers who have completed this stage are categorized as “Registered.”
REGISTERED status refers to the status of external suppliers registered in the DSNG supplier database system, as regulated in the Third Party Supplier Registration SOP Number SOP-AGR-093-R00. These registered suppliers already have identified priority data for FFB supply traceability, including farmer name, planting year, coordinates, total area, planted area, plantation status, and land legality type. Therefore, suppliers with this status are eligible to supply FFB to DSNG mills during the registration phase for a specified period. After this period, the supplier is required to commit to DSNG’s NDPE Policy by signing a Supplier Code of Conduct Declaration. If the supplier is unwilling to commit, DSNG will remove the supplier from its supplier list.
Furthermore, through the supplier engagement program, farmer data collection begins, followed by NDPE outreach at field schools to build farmer capacity, assistance in obtaining the Standardized Data Enforcement (STDB), and an NDPE compliance gap assessment to identify necessary improvements to achieve NDPE compliance at the supplier. Suppliers who have completed the process, undergone assessment by the Sustainability Operations team, and been audited but have not yet achieved a score of 75% are categorized as “Controlled.”
CONTROLLED status is only awarded to external suppliers who have met two requirements:
- Completed the DSNG supplier registration process and committed to implementing the DSNG NDPE Policy by signing the Supplier Code of Conduct Declaration.
- Has entered the Compliance Roadmap program as stipulated in the Third Party Compliance Roadmap SOP Number SOP-AGR-094-R00.
To ensure NDPE compliance, a Monitoring, Review, and Verification (MRV) Program Reporting process is conducted. MRV is conducted for each supplier, with a proportional sample of supplier farmers verifying the results. Suppliers who have completed MRV and achieved a score of ≥ 75% according to the assessment criteria are categorized as “Compliant.”
COMPLIED status refers to external suppliers registered in the DSNG supplier database system and have met the compliance requirements based on the MRV Criteria and Indicators (C&I). Suppliers with compliant status are permitted to supply FFB to DSNG mills for an indefinite period or based on the duration of the partnership between the supplier and DSNG. Compliance audits will be conducted at least once a year on suppliers with compliant status to monitor their compliance. However, if there are indications of violations of the MRV C&I as stipulated in the Third-Party Supplier Compliance MRV SOP Number SOP-AGR-095-R00, compliance audits may be conducted at any time.
In the 2025 report, NDPE socialization had reached 50% of IPC, 50% of Self-Help Cooperative farmers, and 25% of Agent farmers. The implementation of NDPE Measurement, Reporting, and Verification (MRV) in 2025 covered 20 suppliers, consisting of 1 IPC supplier, 11 Self-Help Cooperative suppliers, and 8 Agent suppliers. With the additional implementation of MRV, all external suppliers of DSNG, including IPC, Self-Help Cooperatives, and Agents, have undergone the MRV process. Going forward, NDPE MRV will be carried out periodically every two years for each supplier. In addition, the Company will provide assistance to suppliers who have not yet met the NDPE category.
The MRV Audit is part of the supplier’s commitment to implementing the NDPE policy. Through MRV, the Company verifies legality and compliance, including ensuring that plantations are not located within forest areas or peatlands, and have identified coordinates and clear plantation boundaries. From an environmental and operational perspective, MRV ensures land clearing without burning, the use of appropriate seeds, and the responsible management of fertilizers and pesticides in accordance with Good Agricultural Practices (GAP). MRV also evaluates the implementation of Occupational Safety and Health (OHS), complaint handling mechanisms, the effectiveness of empowerment programs, and the dissemination of NDPE and GAP to suppliers. This process also strengthens the traceability system down to the plantation level.
The Third-Party Supplier Compliance Roadmap Program is a long-term program (with specified deadlines) implemented by DSNG to assist suppliers in preparing all requirements under the NDPE Policy. The series of activities in this Compliance Roadmap program consists of self-assessment, compliance testing, implementation of corrective actions, and verification of the results of corrective actions. The results of monitoring and compliance testing are evaluated. If the result states that the supplier is unable to complete the specified actions within the completion deadline, then DSNG will impose a suspension on the supplier so that they are not allowed to supply FFB until the specified actions can be completed.
Further, to reduce our risks, we continue our efforts to secure the full sustainable certification of all our mills and estates. Please see here for the status of our certification efforts.