Malaysian palm oil producer FGV Holdings Berhad vowed Thursday to “clear its name” after the US banned imports of its palm oil over allegations of forced labour and other abuses.
The US Customs and Border Protection”s Office of Trade issued the ban order against FGV on Wednesday, saying it found indicators of forced labor, including concerns about children, along with other abuses such as physical and sexual violence.
The action, announced a week after The Associated Press exposed major labour abuses in Malaysia”s palm oil industry, was triggered by a petition filed last year by nonprofit organizations.
FGV said all the issues raised “have been the subject of public discourse since 2015 and FGV has taken several steps to correct the situation”.
“FGV is disappointed that such decision has been made when FGV has been taking concrete steps over the past several years in demonstrating its commitment to respect human rights and to uphold labor standards,” it said in a statement.
Malaysia is the world”s second largest producer of palm oil. Together with Indonesia, the two countries dominate the global market, producing 85 percent of the $65 billion supply.
Palm oil and its derivatives from FGV, and closely connected Malaysian-owned Felda, make their way into the supply chains of major multinationals.
They include Nestle, L”Oreal, and Unilever, according to the companies” most recently published supplier and palm oil mill lists. Several huge Western banks and financial institutions not only pour money directly or indirectly into the palm oil industry, but also hold shares in FGV.
AP reporters interviewed more than 130 former and current workers from eight countries at two dozen palm oil companies — including Felda, which owns about a third of the shares in FGV.