At Musim Mas, we know our responsibility and actively seize opportunities to shape a sustainable future. Our commitment to reaching net zero emissions by 2050 under the SBTi framework contributes to the global movement for ambitious corporate decarbonization. We understand that achieving net zero is a complex challenge, but we are moving forward with innovative strategies, collaborative efforts, and unwavering resolve.
Proactive strategies are essential to ensure our market competitiveness and business resilience in the face of climate-related risks. Our inaugural climate risk scenario analysis, conducted in 2024 and aligned with the Task Force on Climate-related Financial Disclosures (TCFD), has allowed us to identify the impacts of medium- and long-term climate-related risks and opportunities for our business. By aligning with the TCFD and ISSB (International Sustainability Standards Board) in the future, we can effectively communicate these impacts to our stakeholders, outline the actions we will take to mitigate the worst effects of climate change and seize opportunities for the transition to a low-carbon economy.
Our net zero commitment is by no means our first effort to combat climate change. As early as 2010, we began to install methane capture facilities in our mills to reduce emissions from palm oil mill effluent. In 2017, we committed to reducing our upstream emissions by 55% against the 2006 baseline by 2025. Since then, we have publicly disclosed our upstream emissions and the Group’s scopes 1 and 2 emissions through our annual Sustainability Report and the Carbon Disclosure Project (CDP). We achieved the 55% reduction target reported in our Sustainability Report 2023, a testament to our commitment and capability. Moving forward, we will transition into emission reduction targets for the Group following the Science-Based Targets Initiative (SBTi) framework.
In 2022, we mapped and reinforced the entire Group’s carbon footprint (Scope 1, 2, and 3) following the global standard of the GHG Protocol. This comprehensive analysis covers emissions from upstream, midstream, downstream, and supporting facilities. Strengthening our internal calculations is crucial as we set Group-level baselines, identify key GHG (Greenhouse Gas) hotspots, and develop reduction targets aligned with the SBTi. Our unwavering alignment with these global standards and initiatives ensures that our efforts are impactful and in line with the best practices in the industry, instilling confidence in our stakeholders.
At the 27th Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCCC) in 2022, Musim Mas and 13 other agricultural commodity companies set out to develop a shared roadmap for reducing emissions from land-use change: the Agriculture Sector Roadmap to 1.5°C. The Tropical Forest Alliance (TFA) facilitated the roadmap development, hosted by the World Economic Forum (WEF) and supported by the World Business Council for Sustainable Development (WBSCD). It represents a sector-wide plan for addressing forest loss in supply chains and accelerating collaboration with others to achieve that goal. It commits the companies to implement time-bound plans and report publicly on their progress towards the targets annually.
In January 2024, SBTi endorsed our commitment to net zero emissions. This alignment with scientific principles is a testament to our commitment to the Best Practices for climate action and reporting. In October 2024, SBTi officially approved the Group’s greenhouse gas for near- and long-term emissions reduction targets under the SBTi Corporate Net-Zero Standard and the SBTi Forest, Land, and Agriculture Guidance (FLAG).
Musim Mas’s validated net zero targets mark a significant step for showing climate leadership in the palm oil industry, concretizing the Group’s commitment to sustainability and responsible practices. This effort is crucial to our broader goal of supporting global climate action in line with the 1.5⁰C pathway and positively impacting the communities and ecosystems linked to our operations and consumers in international markets that utilize products containing our raw materials.
Scope 1 and 2 Emissions
Scope 1 emissions encompass direct emissions from sources within a company’s control. In the palm oil industry, these can arise from various sources, such as plantation soil management, combustion of biomass for generating steam and electricity in processing facilities, fuel combustion for vehicles and equipment across plantations, mills, and refineries, land-use change from the company’s palm oil operations, and transportation of harvested palm fruits or refined products from lorries or ships owned by the company.
Scope 2 emissions are indirect emissions resulting from purchased energy, such as the generation of purchased electricity, heat, or steam consumed by a company. In our operations, scope 2 emissions arise from using grid electricity and steam for processing facilities or other operations in the palm oil industry.
The emissions from direct sources controlled by Musim Mas (Scope 1) and indirect emissions from purchased electricity and steam used to operate our facilities (Scope 2) contributed to approximately 9% of the Group’s baseline year emissions.
Scope 3 Emissions
Most GHG emissions in many sectors fall under Scope 3, which are indirect emissions from a company’s value chain stemming from upstream and downstream activities (e.g., emissions from suppliers, contractors, and their goods and services). These are beyond a company’s operational control. While these are sources where we would have lesser influence in emission management, we recognize that accounting for GHG emissions across our supply chain is a crucial step.
We model and account for our Scope 3 emissions against the GHG Protocol guidelines. Following our baseline emissions, most Group emissions come from Scope 3, contributing to more than 90% of the total emissions. These arise primarily from raw materials obtained from third-party suppliers for palm oil products, which we process and refine to produce intermediate and final products.
GHG Emission Intensity
In addition to employing the GHG Protocol at our global operations, we calculate emissions intensity across our Roundtable on Sustainable Palm Oil (RSPO)-certified upstream operations using the RSPO PalmGHG v4 calculator. The calculation covers all 15 RSPO-certified integrated mills.
The emissions arise from land-use change combining land conversion and peat oxidation. Installing methane capture facilities at our palm oil mills reduces our GHG emissions by hundreds of thousands of tons of carbon dioxide equivalent (tCO2e) annually. Combining other emission sources and offset with sequestration (from palm trees and conservation areas) as well as from the sale of electricity generated from our methane capture facilities and palm kernel shells (PKS), our net emission intensity was about 2.66 MT CO2e/MT CPO in 2022.
Life Cycle Assessment (LCA)
In addition to accounting for our Group emissions, we also account for our product’s carbon footprint, assessing the global warming potential following a product’s life cycle. Frequently, our products form ingredients for our customers’ product manufacturing, making our emissions part of their Scope 3 emissions. Consequently, customer requests for a Product Carbon Footprint (PCF) have been growing as part of global collective decarbonization efforts.
In 2019, Musim Mas initiated a Life Cycle Assessment (LCA) for our upstream products. In 2023, we completed LCA for selected downstream products, with the scope from cradle to gate following the ISO 14040 and ISO 14044 frameworks. The LCA covers potential environmental impacts such as global warming potential (equivalent to PCF), eutrophication, acidification, and water consumption. The LCA study is a rigorous exercise relating to the scope and product life cycle processes; hence, Musim Mas will continue to improve our LCA models, conforming to the highest standards.
Group-level emission reduction roadmap
Using 2021 as the Group’s baseline year, Musim Mas has committed to these near- and long-term targets:
| Category | Near-Term 2030 Targets | Net Zero 2050 Targets |
| Energy and Industry | Reduce absolute scope 1, 2, and 3 GHG emissions by 42% by 20301 | Reduce absolute scope 1, 2, and 3 GHG emissions by 90% by 20501 |
| FLAG | Reduce absolute scope 1 and 3 FLAG GHG emissions by 30.3% by 20302 | Reduce absolute scope 1 and 3 FLAG GHG emissions by 72% by 20502 |
Note:
1The target boundary includes land-related emissions and removals from bioenergy feedstocks
2 The target includes FLAG emissions and removals.
Our GHG emission intensity for our plantations and mills has declined rapidly over the years due to the various best management practices Musim Mas has undertaken since 2006. Such practices include no new planting on peat since 1 January 2008, installing methane capture facilities, optimizing chemicals use through Integrated Pest Management (IPM), and practicing precision agriculture.
Although a significant proportion of the potential reduction has already been realized, we will continue to lower our GHG emission intensity by improving our water management in peat areas, rehabilitating peat conservation areas, and increasing our FFB yield and oil extraction rate.
