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Introduction to SMETA: The World’s Leading Audit SMETA (Sedex Members Ethical Trade Audit) is recognised globally as the most widely used ethical audit. It plays a crucial role in helping businesses evaluate and enhance their labour, health and safety, environmental, and ethical standards within their operations and supply chain. By providing a structured and comprehensive assessment, SMETA allows companies to protect workers, improve working conditions, and comply with legislation. What is SMETA? SMETA is an ethical audit methodology that businesses employ to gain a deeper understanding of their social and environmental performance. It covers key areas such as labour standards, health and safety, environmental management, and business ethics. Conducted by accredited Sedex Affiliate Audit Companies (AACs), the audit results in a Corrective Action Plan that guides businesses or their suppliers in addressing areas needing improvement. The SMETA Audit Process Application : The process begins by submitting a SMETA audit application to an AAC. Only accredited companies are authorised to conduct these audits and upload the results to the Sedex platform. Preparation : Prior to the audit, businesses should complete a Sedex Self-Assessment Questionnaire (SAQ). This tool is essential for identifying potential risks and understanding current compliance status, helping companies prepare effectively for the audit. Onsite Audit : The onsite audit involves several steps including management and worker interviews, document reviews, and site tours. It is essential that businesses maintain normal operations during the audit and designate a liaison to assist the auditor. Reporting : Following the audit, the auditor uploads the report to the Sedex platform, where authorised customers can access it. This report includes a summary of findings and any non-compliance issues identified during the audit. Continuous Improvement : SMETA emphasises continuous improvement rather than simply passing or failing. The audit helps businesses identify areas for ongoing enhancement in their operations and management systems. Benefits of SMETA for Your Business SMETA audits provide numerous benefits that can significantly impact your business: Increased Visibility : By understanding the social and environmental performance of your business and suppliers, you can make informed decisions and demonstrate your commitment to responsible practices. Risk Management : SMETA allows businesses to assess and monitor high-risk suppliers, ensuring continuous performance improvements over time. Efficient Auditing : The data collected through SMETA can be shared with multiple buyers, reducing the need for repeated audits and streamlining the process. Improved Supplier Performance : The Corrective Action Plan provided by SMETA guides suppliers in addressing and resolving issues identified during the audit, leading to better overall performance. Legislative Compliance : SMETA audits facilitate compliance with both existing and emerging legislation, helping businesses avoid legal risks and penalties. Conclusion Incorporating SMETA into your business operations not only protects workers and improves conditions but also enhances your company’s reputation and compliance with international standards. By focusing on continuous improvement, SMETA ensures that businesses remain competitive and sustainable in an ever-changing global market.

South Korea Waste Recycles South Korea has achieved an extraordinary milestone in waste management, particularly in the recycling of food waste. The country successfully recycles 98% of its food waste, setting an example for the world in sustainable waste management. This article explores the strategies and technologies that have enabled South Korea to reach this impressive figure and the challenges that still remain. The Evolution of Food Waste Management in South Korea Over the past 20 years, South Korea has undergone a dramatic transformation in how it manages food waste. Once a nation that discarded nearly all of its food waste, South Korea now recycles almost all of it. This remarkable shift is the result of stringent policies and the adoption of cutting-edge technologies designed to handle food waste efficiently. Key Policies Driving Success The South Korean government has implemented several key policies that have played a crucial role in achieving this high recycling rate. These include: Ban on Landfilling Food Waste:  The country has banned the disposal of food waste in landfills, a practice that was once commonplace. Mandatory Waste Sorting:  Citizens are required to separate their food waste from other types of waste, ensuring that it can be recycled effectively. Pay-As-You-Throw System:  A cost-based disposal system has been introduced, where residents pay based on the amount of food waste they produce. These policies were initially met with resistance, as citizens had to pay fines and fees for their food waste. However, over time, recycling has become a routine part of life for South Korea's 50 million people. Advanced Recycling Facilities South Korea's success in food waste management is also due to its extensive network of recycling facilities. The country has around 300 facilities that process food waste into various useful products, such as compost, animal feed, and biogas. One notable facility is the Daejeon Bioenergy Center , which converts food waste into bioenergy. This center handles half of the daily food waste generated in the city of Daejeon, demonstrating the effectiveness of bioenergy production from waste. The Role of Technology Technology plays a significant role in South Korea's waste management system. In Seoul, for example, many high-rise buildings are equipped with electronic waste bins that weigh the food waste and charge residents monthly based on the amount they dispose of. Some residents even compost their waste at home using compost bags that cost as little as 10 cents. Challenges and Lessons Learned Despite its success, South Korea continues to face challenges in food waste management. One of the ongoing challenges is reducing the overall amount of food waste generated and ensuring that waste is properly sorted. Non-compostable items mistakenly mixed with food waste can cause mechanical problems at recycling facilities. Moreover, while biogas production from food waste has been effective in South Korea, this model may not be easily replicable in other climates or economic environments. Conclusion South Korea's comprehensive approach to food waste management, which combines waste reduction with effective recycling systems, has positioned the country as a global leader in this field. By enforcing strict policies, investing in advanced technologies, and educating its citizens, South Korea has proven that significant progress in waste management is possible. However, the journey continues as the country works to overcome ongoing challenges and further improve its food waste management system.

Introduction: A Strategic Partnership for a Greener Future Indonesia and Japan have partnered significantly to advance renewable energy initiatives to achieve Net Zero Emission (NZE) targets. This collaboration is formalized through a Memorandum of Understanding (MoU) between Indonesia's Ministry of Energy and Mineral Resources (ESDM) and Japan's New Energy and Industrial Technology Development Organization (NEDO), an entity under the Ministry of Economy, Trade, and Industry (METI) of Japan. The AZEC Ministerial Meeting: A Platform for Global Decarbonization The MoU was signed during the 2nd Asia Zero Emission Community (AZEC) Ministerial Meeting, which was held in Jakarta on August 21, 2024. This meeting brought together ministers from AZEC member countries, including Indonesia, Thailand, Malaysia, Singapore, Vietnam, the Philippines, Cambodia, Laos, Brunei, and Australia. The event is a key moment in Asia's journey towards a zero-emission future, with Indonesia and Japan playing pivotal roles. Focus Areas of the Indonesia-Japan Energy Partnership Under the MoU, Indonesia and Japan are committed to promoting decarbonization in the energy sector by leveraging available energy resources, adopting clean energy technologies, and enhancing energy efficiency. Key areas of focus include: Renewable Energy Development : Both countries will develop renewable energy sources such as solar, hydro, wind, and bioenergy (biomass, biomethane, and biofuels). Hydrogen Production and Supply Chain : The partnership will focus on producing hydrogen and establishing its supply chain. Energy Conservation Technologies : Indonesia and Japan will work together to optimize energy conservation technologies, including hybrid solar-diesel power plants, heat pumps, and cogeneration waste heat to power (WHP) systems. Electrification in Industry : The collaboration extends to electrification technologies in the industrial sector, smart grid technology development, and demand-side management. Energy Services Company (ESCO) Model : This partnership also includes the development of the ESCO model, which enhances the value of coal for industrial use and manages waste in critical mineral processing. NEDO's Role and Impact in Indonesia NEDO, a technological innovation accelerator, focuses on addressing global energy and environmental challenges. One of its notable projects in Indonesia is the development of the first hydrogen production unit from the Lahendong Binary Geothermal Power Plant, which has a capacity of 500 kilowatts (kW). NEDO also supports the Energy Management System (EMS) demonstration project in Nunukan, Pulau Sebatik, which integrates solar, biomass, gas, and diesel power plants. AZEC Ministerial Meeting Outcomes and Future Initiatives The 2nd AZEC Ministerial Meeting resulted in significant outcomes, including the AZEC Ministerial Joint Statement, the publication of 70 MoUs for new AZEC projects (with 30 led by Indonesia), and the launch of the Asian Zero Emission Center. These initiatives will drive substantial investment and collaboration in regional decarbonization efforts. Conclusion: Paving the Way for a Sustainable Future The partnership between Indonesia and Japan is a testament to their shared vision of addressing climate change through clean technology and energy efficiency. The initiatives launched during the AZEC Ministerial Meeting mark a significant step forward in achieving net zero emissions and fostering sustainable economic growth in Asia.

The forestry industry plays a crucial role in maintaining ecosystem balance and the sustainability of natural resources. As global challenges such as climate change, deforestation, and land degradation become increasingly essential, forestry certification standards are becoming increasingly essential. One internationally recognized standard is the Indonesian Forestry Certification Cooperation (IFCC). What is IFCC? IFCC is a sustainable forestry certification scheme focused on responsible forest management in Indonesia. Established with the aim of supporting sustainable forest management practices in line with conservation, social, and economic principles, IFCC is pivotal in promoting responsible forestry in the country. IFCC collaborates with the Programme for the Endorsement of Forest Certification (PEFC) , an international organization that endorses forestry certification schemes worldwide. Through this partnership, wood products certified by IFCC are globally recognized, adding value to the forestry industry players in Indonesia. Benefits of IFCC Certification Global Market Access:  IFCC certification opens up opportunities for Indonesian forestry companies to penetrate international markets that increasingly demand certified products. Consumer Confidence:  This certification enhances consumer confidence in wood products, assuring them that these products come from sustainably managed sources. Regulatory Compliance:  IFCC helps companies meet legal and regulatory requirements related to forest management in Indonesia and export markets. Environmental Sustainability:  The IFCC standard ensures that forest management practices do not sustain natural resources and affect biodiversity and wildlife habitats. Positive Social Impact:  By adhering to the IFCC standard, companies contribute to local community empowerment and respect the rights of workers and indigenous communities. IFCC Compliance with Indonesian Forestry Laws and Regulations As a sustainable forestry certification scheme, IFCC is designed to comply with various regulations and laws in Indonesia, including those related to forest management, environmental protection, and forestry. Some of the relevant regulations followed by the IFCC standard include: Law No. 41 of 1999 on Forestry IFCC ensures that certified forest management adheres to the principles set out in Law No. 41/1999, which includes provisions on sustainable forest management, natural resource conservation, and community empowerment around forests. Government Regulation No. 6 of 2007 on Forest Planning and Forest Management Plan Preparation The IFCC standard complies with Government Regulation No. 6/2007, which governs forest planning and the preparation of forest management plans, including long-term and short-term plans that forest utilization permit holders must develop. Minister of Environment and Forestry Regulation No. P.32/MENLHK/SETJEN/SET.1/3/2016 on Forest Areas with Special Purposes Management IFCC supports the management of forest areas with special purposes, such as conservation, education, and research, in accordance with this regulation. Minister of Environment and Forestry Regulation No. P.77/MENLHK/SETJEN/KUM.1/11/2019 on Timber Legality Verification System (SVLK) Guidelines The IFCC standard is compatible with the Timber Legality Verification System (SVLK), one of the recognized timber legality systems in Indonesia, as part of its regulatory compliance. Government Regulation No. 27 of 2012 on Environmental Permits The IFCC standard requires certificate holders to comply with environmental permit requirements, including those stipulated in Government Regulation No. 27/2012, ensuring that all forest management activities do not harm the environment and meet the requirements set out in the Environmental Impact Analysis (AMDAL). By adhering to these regulations, the IFCC standard helps ensure that certified forest management aligns with international standards and fully complies with applicable regulations and laws in Indonesia. As a sustainability consultant, Peterson Indonesia can assist companies in understanding and meeting these requirements to ensure a smooth and compliant certification process. The IFCC Certification Process The IFCC certification process involves several stages, from preparation to post-certification monitoring. Here are the key steps in the certification process: Initial Preparation:  Companies must conduct an internal audit to ensure readiness to meet IFCC standards. Application Submission:  Companies can submit a certification application to an IFCC-recognized certification body once ready. Field Audit:  The certification body will conduct a field audit to assess the compliance of forest management practices with IFCC standards. Certificate Issuance:  If all requirements are met, the certification body will issue an IFCC certificate valid for five years, with annual audits to ensure ongoing compliance. Monitoring and Supervision:  During the certification period, companies must continuously monitor forest management practices and be prepared for re-audits as scheduled. Peterson Indonesia’s Role in IFCC Certification As a sustainability consultant, Peterson Indonesia has the experience and expertise to assist forestry companies in the IFCC certification process. Our consultancy services include: Initial Evaluation and Preparation:  Assisting companies in conducting internal audits and identifying areas for improvement to meet IFCC standards. Training and Capacity Building:  Providing training to company staff to understand and apply IFCC principles in daily operations. Certification Process Support:  Guiding companies through the certification process, from application submission to field audits. Ongoing Monitoring and Continuous Improvement:  Helping companies maintain compliance with IFCC standards through regular monitoring and recommendations for improvement. Conclusion IFCC certification is vital for forestry companies looking to ensure responsible and sustainable forest management practices. With support from Peterson Indonesia, companies can navigate the certification process more smoothly and effectively, ensuring they meet legal and market requirements and contribute positively to the environment and society.

Understanding NDPE NDPE stands for No Deforestation, No Peat, No Exploitation . This policy represents a commitment to ensuring that industry practices, particularly in the palm oil sector, are conducted in an environmentally and socially responsible manner. Objectives of NDPE The NDPE policy aims to protect the environment and the communities involved in the palm oil supply chain. Its primary objectives include: Avoiding deforestation and peatland degradation. Respecting human rights, especially the rights of indigenous peoples and workers. Enhancing sustainable environmental management practices. Targeted Stakeholders NDPE applies to all companies involved in the global palm oil supply chain, including: Plantation companies. Trading companies. Consumer goods companies. Financial institutions. How to Implement NDPE Here are the steps for implementing NDPE according to the main points of the policy: No Deforestation Landscape Approach:  Identify and conserve High Conservation Value (HCV) and High Carbon Stock (HCS) areas in development and surrounding landscapes. Sustainable Management:  Manage and monitor HCV and HCS areas sustainably. FPIC (Free, Prior, and Informed Consent):  Respect land rights of local communities through informed, non-coerced consent. Greenhouse Gas Emission Management:  Assess and reduce operations' greenhouse gas (GHG) emiss ions. No Burning:  Avoid using fire for land clearing or replanting. No Peat Peatland Protection:  Protect and manage existing peatlands responsibly. Water Management:  Ensure proper water management to prevent peatland degradation. Fire Prevention:  Prevent fires through effective monitoring and community cooperation. Peat Restoration:  Restore peatlands when necessary. No New Development:  No new development on peatlands. No Exploitation Respect for Communities:  Respect the rights of indigenous peoples, local communities, and smallholders. Support for Smallholders:  Provide adequate support to smallholders to ensure their well-being. Gender Equality:  Apply gender-sensitive approaches in all actions. Worker Rights:  Ensure fair wages, safe working conditions, and freedom of association. Expected Impacts Effective implementation of NDPE is expected to: Reduce global deforestation and protect biodiversity. Preserve peatlands as important carbon sinks. Improve the well-being of local communities and workers in the palm oil sector. Promote more sustainable and responsible industry practices. By committing to NDPE implementation, your company can be crucial in fostering a more sustainable and ethical palm oil supply chain. Understanding and applying the principles of NDPE supports global efforts to protect the environment and contributes to the social and economic well-being of the communities involved in the industry. As a leading sustainability consultant, we are ready to assist you at every step of your journey towards more responsible and sustainable business practices. Contact us to learn more about how we can support your NDPE implementation and ensure the success of your sustainability initiatives.

Introduction The Programme for the Endorsement of Forest Certification (PEFC) is a global leader in promoting sustainable forest management through independent third-party certification. As a non-profit, non-governmental organization, PEFC works tirelessly to protect forests worldwide, ensuring that they are managed in a way that preserves their biodiversity, productivity, and ecological functions. What is PEFC? The PEFC is a global alliance of national forest certification systems dedicated to endorsing sustainable forest management practices. Founded in 1999 by small- and family forest owners in Europe, PEFC has grown to become the largest forest certification system in the world. Headquartered in Geneva, Switzerland, PEFC comprises more than 80 members, including national certification systems, NGOs, labour unions, and trade associations. Why Forest Certification Matters Forests are crucial in maintaining the global environment, providing livelihoods, and supporting economies. Sustainable forest management is essential to preserving these resources for future generations. PEFC’s certification processes ensure that forest products reaching the market are sourced from responsibly managed forests, thus enabling consumers and companies to make sustainable choices. PEFC's Global and Local Approach PEFC operates globally and through localized initiatives, working closely with numerous national organisations to adapt its standards to specific regional contexts. These national organisations include the Malaysian Timber Certification Council (MTCC) in Malaysia, the Indonesian Forestry Certification Cooperation (IFCC) in Indonesia, the Instituto Pró Manejo Florestal in Brazil, etc. By collaborating with these organisations, PEFC ensures its certification system is globally recognised and locally relevant, promoting sustainable forest management practices that respect local traditions, laws, and ecological conditions. The Importance of Sustainable Forest Management Sustainable forest management involves the stewardship of forests in a way that maintains their biodiversity, productivity, and ability to regenerate. It also ensures that forests continue to fulfil their ecological, economic, and social functions without damaging other ecosystems. PEFC certification provides a mechanism for forest owners to demonstrate their commitment to sustainable practices. Certification Process PEFC’s certification process includes two main components: Sustainable forest management certification and chain of custody certification. The former ensures that forests are managed according to strict environmental, social, and economic criteria, while the latter tracks forest-based products from their source to the final product. This rigorous process guarantees that only sustainably sourced products carry the PEFC label. Endorsement and Mutual Recognition PEFC’s endorsement process ensures national certification systems meet international standards. This process involves a thorough assessment by a third-party assessor, ensuring that the national systems comply with PEFC’s stringent requirements. Once endorsed, products certified under these national systems are recognized as PEFC-certified worldwide. Group Certification for Small Forest Owners Recognizing the challenges small- and family forest owners face in obtaining certification, PEFC developed the group certification approach. This allows small forest owners to pool their resources and work together to achieve certification, making it affordable and accessible. Today, around one million small forest owners have achieved PEFC certification through this approach. Certification for Supply Chain Companies PEFC chain of custody certification offers companies a way to demonstrate their commitment to sustainable sourcing. This certification is available to companies involved in the manufacturing, processing, trading, or selling forest-based products. It provides numerous benefits, including access to new markets and compliance with international legislation. Conclusion PEFC’s commitment to sustainable forest management has made it a global leader in forest certification. Through its tailored approach, PEFC ensures that forests are managed in a way that is environmentally sound, socially just, and economically viable. By choosing PEFC-certified products, consumers and businesses can support the responsible management of the world’s forests, ensuring their preservation for future generations.

Supply Chain & National Capacity Summit 2024 The Supply Chain & National Capacity Summit Jakarta 2024 successfully brought together nearly 10,000 upstream oil and gas stakeholders over three days. This significant event served as a platform for discussions, panels, and Focus Group Discussions (FGDs) on strategic issues related to the national upstream oil and gas supply chain. Key Highlights of the Summit Over the course of three days, the Summit attracted 9,694 participants, including representatives from 28 Cooperation Contract Contractors (KKKS) and 39 partners. The event was ideal for industry stakeholders to engage in meaningful discussions on the industry's future. Industry Collaboration and Vendor Engagement The Summit also featured 27 exhibition booths from various industry partners, showcasing innovations and fostering vendor engagement. Booths dedicated to National Capacity, the Centralized Integrated Vendor Database (CIVD), Contractor Health Safety & Environment Management System (CHSEMS), and Customs provided opportunities for vendors to gain insights and actively participate in the upstream oil and gas procurement process. Memorandums of Understanding to Strengthen Collaboration A key outcome of the Summit was signing several Memorandums of Understanding (MoUs). These agreements aim to strengthen collaboration within the industry and prepare the upstream oil and gas sector for future challenges. Addressing Challenges in the Upstream Oil and Gas Industry The industry faces increasingly complex challenges, particularly with the upcoming National Strategic Projects (PSN) set to commence production between 2027 and 2030. Strengthening an efficient and integrated supply chain ensures these projects remain on schedule. VVIP Attendance and Emphasis on National Synergy The presence of VVIPs, such as the Coordinating Minister for Maritime Affairs and Investment, Luhut Binsar Pandjaitan, and the Minister of Energy and Mineral Resources, Arifin Tasrif, underscored the importance of national synergy in developing the supply chain and enhancing national capacity. Minister Luhut commended SKK Migas for its progress in digitalizing the upstream oil and gas supply chain management. Leadership Talks and COO Forum: Insights from Industry Leaders One of the most anticipated sessions at the Summit was the Leadership Talks and COO Forum. Industry leaders shared their perspectives on overcoming future challenges in the upstream oil and gas sector, offering valuable insights and solutions. Closing Ceremony and Awards: Recognizing Excellence On the final day, SKK Migas awarded KKKS and individuals who made significant contributions to the advancement of the upstream oil and gas industry. Rudi Satwiko, deputy of Business Support at SKK Migas, expressed his gratitude to all participants and emphasized the importance of the Summit in improving supply chain management (SCM) practices, enhancing efficiency, and adding value to the industry.

ESPR dan Digital Product Passport The European Union (EU) is leading the way toward sustainability with the Ecodesign for Sustainable Products Regulation (ESPR) and the introduction of the Digital Product Passport (DPP). These two initiatives are closely interconnected. The ESPR serves as the foundation for sustainable product design, while the DPP provides the necessary transparency to enforce these standards across the global supply chain. Understanding the ESPR: A Blueprint for Sustainable Products The ESPR, effective from 18 July 2024, replaces the previous Ecodesign Directive (2009/125/EC). This regulation is a key component of the EU’s Circular Economy Action Plan, aiming to decouple economic growth from resource use and reduce environmental impact throughout the product lifecycle. The ESPR sets stringent ecodesign requirements for various products, emphasising durability, repairability, energy efficiency, and recyclability. By enforcing these standards, the ESPR ensures that products in the EU market are more environmentally friendly and cost-effective in the long run. One of the ESPR's most innovative aspects is its approach to combating waste, particularly the destruction of unsold products. By mandating transparency in companies' disposal practices, the ESPR encourages businesses to adopt more sustainable practices, such as recycling and repurposing unsold goods. Digital Product Passport: The Product’s ID Card in the Digital Age A key feature of the ESPR is the introduction of the Digital Product Passport (DPP), which serves as a digital identity for products. This passport will contain detailed information about the product's materials, origins, environmental impact, and lifecycle. The DPP, accessible electronically, allows consumers, regulators, and businesses to make informed decisions about the sustainability of products. The DPP system enhances product circularity by providing clear and accessible information on repair, recycling, and disposal options. This transparency supports the EU’s sustainability goals and empowers consumers to make environmentally friendly choices. For businesses, the DPP represents an opportunity to differentiate themselves in a market increasingly driven by sustainability. The Synergy Between ESPR and DPP ESPR and DPP are not only complementary; they are interdependent. The success of the ESPR's ambitious goals heavily relies on the transparency provided by the DPP. Without accurate and accessible product information, it would be challenging to enforce the ESPR's ecodesign standards. For example, a product designed to meet the ESPR's durability standards may be accompanied by a DPP detailing its expected lifespan, materials used, and repair or recycling instructions. This information helps ensure that the product meets the required sustainability criteria and allows consumers to verify these claims. Moreover, the DPP system supports the EU's broader circular economy goals by enabling better resource management. By tracking the product lifecycle, the DPP can help identify opportunities for recycling and repurposing materials, reducing waste, and lowering products' overall environmental impact. Implementation Timeline for ESPR and DPP 18 July 2024 : ESPR comes into effect, marking the transition from the Ecodesign Directive to a more comprehensive framework. Third Quarter of 2024 : The European Commission establishes the Ecodesign Forum to facilitate consultations with various stakeholders. Second Quarter of 2025 : The first ESPR work plan is published, including a list of products and measures to be assessed based on energy and material efficiency priorities. What Can Businesses Do? Conduct a Life Cycle Assessment (LCA) : Assess the environmental impact of products throughout their lifecycle to comply with ESPR requirements. Design for Sustainability : Ensure products are designed to be easily repairable, recyclable, and have a longer lifespan. Integrate the Digital Product Passport (DPP) : Prepare products with a Digital Product Passport to meet future mandatory ESPR requirements. Be Proactive in Compliance : Start compliance measures early to gain a competitive edge in a sustainability-focused market. Challenges and Opportunities Ahead While the ESPR and DPP initiatives are highly innovative, they also present challenges. Implementing the DPP across various products requires significant coordination and standardisation. Companies will need to adapt their processes to provide the necessary data for the DPP, and there may be initial costs associated with this transition. However, the long-term benefits far outweigh these challenges. By embracing the ESPR and DPP, businesses can position themselves as leaders in sustainability, potentially accessing new markets and consumer segments that prioritise environmental responsibility. Additionally, the EU’s commitment to supporting international partners in adopting these standards ensures that the benefits of the ESPR and DPP will extend beyond Europe, promoting global sustainability. Conclusion: A Sustainable Future with ESPR and DPP The ESPR and Digital Product Passport represent significant strides in the EU’s efforts to create a more sustainable and circular economy. By setting stringent ecodesign standards and providing the necessary transparency to enforce them, these initiatives protect the environment and drive innovation and competitiveness in the global market. As businesses and consumers adapt to these new regulations, the ESPR and DPP will pave the way for a future where sustainable products become the norm, not the exception.

CBAM: European Union Carbon Border Adjustment Mechanism Climate change is an urgent global issue that requires coordinated international efforts. The European Union (EU) has taken significant strides in addressing this challenge by introducing the Carbon Border Adjustment Mechanism (CBAM). This mechanism aims to ensure that the carbon emissions embedded in goods imported into the EU are accounted for, aligning the carbon price of imports with domestic production. What is the Carbon Border Adjustment Mechanism (CBAM)? The Carbon Border Adjustment Mechanism (CBAM) is a tool developed by the European Union to put a fair price on the carbon emissions generated during the production of carbon-intensive goods entering the EU. CBAM is designed to prevent carbon leakage, a phenomenon where companies relocate their carbon-intensive production to countries with less stringent climate policies, thereby undermining the EU's climate objectives. By ensuring that the carbon price of imports is equivalent to that of domestic products, CBAM encourages cleaner industrial production worldwide. Phased Implementation of CBAM: CBAM will be implemented in two key phases: Transitional Phase (2023 - 2025): On October 1, 2023, CBAM entered its transitional phase, which will last until the end of 2025. During this period, importers of goods covered by CBAM will be required to report greenhouse gas (GHG) emissions embedded in their imports. However, they will not be required to purchase or surrender CBAM certificates. The goods initially covered by CBAM include cement, iron and steel, aluminum, fertilizers, electricity, and hydrogen. These sectors are at the highest risk of carbon leakage due to their carbon-intensive production processes. The transitional phase serves as a pilot period, allowing stakeholders to collect valuable data on embedded emissions, refine the CBAM methodology, and prepare for the definitive regime. Definitive Regime (from 2026): Starting in 2026, the definitive regime of CBAM will be fully implemented. Importers will be required to purchase CBAM certificates corresponding to the emissions embedded in their imports. The price of these certificates will be based on the weekly average auction price of EU Emissions Trading System (ETS) allowances. Importers who can demonstrate that a carbon price has already been paid during the production of the imported goods will be allowed to deduct the corresponding amount from their CBAM certificate obligations. The European Commission will continuously review the CBAM's functioning and assess the feasibility of including additional goods and sectors under its scope by 2030. Checklist for EU Importers To help importers navigate the complexities of CBAM, the European Commission has provided a checklist outlining the essential steps for compliance: Check Goods : Verify if the goods you import are listed in Annex I to the CBAM Regulation and contact the National CBAM Competent Authority (NCA) in your country. Register : Register through your NCA for access to the CBAM Transitional Registry, where you will upload quarterly reports on emissions embedded in imported goods. Ensure Awareness : Make sure your trading partners outside the EU are aware of the detailed guidance provided by the European Commission on the goods in scope and how to calculate embedded emissions. Follow Training : Engage with the general and sector-specific training materials provided by the European Commission to prepare for the new reporting rules and tools. Submit Reports : Submit your first quarterly CBAM report by January 31, 2024, covering your imports in the fourth quarter of 2023, and stay informed about the latest developments as we approach the definitive phase in 2026. Impact on Global Trade:   The introduction of CBAM is expected to have a significant impact on global trade, particularly for countries that export carbon-intensive goods to the EU. Non-EU countries with less stringent climate policies may face increased costs for exporting to the EU, incentivizing them to adopt greener production methods. This global movement towards reducing carbon emissions will likely reshape international trade dynamics, with sustainability becoming a key factor in trade agreements and policies. The Impact of Climate Change Issues on Trade for Indonesia: Indonesia, as one of the world's largest emerging economies, may face minimal direct impact from CBAM in the short term. However, global policies like CBAM will likely spur international efforts to leverage non-tariff measures based on climate change, potentially influencing Indonesia's trade landscape in the long run. As global markets increasingly prioritize sustainability, Indonesia's exports to the EU could be affected by the need to align with stringent environmental standards. Indonesia's Commitment to Reducing GHG Emissions: Indonesia has demonstrated a strong commitment to addressing climate change and reducing greenhouse gas (GHG) emissions. Implementing the Paris Agreement is in line with the mandate of the 1945 Constitution, particularly Article 28H number 1, which emphasizes the right to a good and healthy environment. In 2021, Indonesia ratified Presidential Regulation Number 98 concerning the Implementation of Carbon Economic Value (Nilai Ekonomi Karbon/NEK). This regulation aims to achieve the nationally determined contribution (NDC) targets and control GHG emissions in national development. At the 2021 UN Climate Change Conference in Glasgow, Indonesia's President underscored the country's rapid contribution to global Net-Zero Emissions and the importance of a transparent, inclusive, and fair carbon economy. Regulatory Framework for NEK Implementation in Indonesia:   The implementation of the NEK under Presidential Regulation No. 98/2021 involves various ministries, institutions, regional governments, business actors, and communities. The regulation outlines the procedures for carbon trading, emission offsets, carbon levies, performance-based payments, and other mechanisms based on the development of science, technology, and sectoral capacity. Key Tools for Climate Change Policy Control in Indonesia: NDC Strategies and Roadmaps:  Indonesia has developed strategies and roadmaps for both climate change mitigation and adaptation, aiming to achieve its NDC targets by 2030. SIGN-SMART:  The Greenhouse Gas Inventory System that tracks GHG emissions. SRN (Sistem Registri Nasional):  The National Registry System that records climate change mitigation actions, adaptation actions, and the implementation of NEK. ProKlim:  The Climate Village Program that promotes community-based climate action. SISREDD+:  The Safeguard Information System for REDD+ (Reducing Emissions from Deforestation and Forest Degradation). Target NDC Indonesia untuk Tahun 2030 Indonesia's NDC Target for 2030: Indonesia has set a target to reduce GHG emissions by 29% - 41% by 2030 through collective mitigation efforts at national and subnational levels. Key sectors involved in this effort include: Forestry Sector:  Managed by the Ministry of Environment and Forestry (KLHK) in collaboration with provincial and private sectors. Energy Sector:  Managed by the Ministry of Energy and Mineral Resources, Transportation, and Industry, with involvement from provincial and private sectors. Waste Sector:  Managed by KLHK, the Ministry of Public Works and Public Housing (PUPR), and the Ministry of Industry, with participation from regional governments and the private sector. Agricultural Sector:  Managed by the Ministry of Agriculture, with support from regional governments and the private sector. Industrial Processes and Product Use (IPPU) Sector:  Managed by the Ministry of Industry in collaboration with the private sector. SPE-GRK (Greenhouse Gas Emission Reduction System): To support the European Green Deal, Indonesia has developed the Greenhouse Gas Emission Reduction System (SPE-GRK). This system provides proof of emission reductions by businesses and activities, validated through a Monitoring, Reporting, and Verification (MRV) process, and recorded in the SRN. The SPE can serve as the basis for carbon labels, sustainability reports, and access to environmentally friendly financing. SRN (Sistem Registri Nasional) and ONE DATA: The SRN is mandated by Presidential Regulation No. 98/2021 to ensure the accurate recording of climate change mitigation and adaptation actions, NEK implementation, and climate change resources. The SRN also helps avoid double counting of mitigation actions and provides data for further policy considerations. The ONE DATA initiative ensures the availability of national, sectoral, and sub-sectoral data on GHG emissions and climate resilience. Conclusion:   The EU's Carbon Border Adjustment Mechanism (CBAM) represents a significant step towards global climate action by ensuring that the carbon emissions embedded in imported goods are fairly priced. While the impact on Indonesia may be minimal initially, the global shift towards sustainability will likely influence Indonesia's trade dynamics and encourage stronger climate commitments. Indonesia's proactive approach to reducing GHG emissions, as demonstrated by its regulatory framework and international commitments, positions the country as a key player in the global effort to combat climate change.

In a remarkable milestone for renewable energy, wind and solar power have overtaken fossil fuels in electricity generation across the European Union for the first half of 2024. This shift marks a significant step in the EU's transition towards a more sustainable and clean energy future. Key Highlights 30% : Wind and solar share of EU electricity generation in H1-2024 27% : Fossil fuels share of EU electricity generation in H1-2024 -17% : Decline in fossil fuel generation in H1-2024 The Rise of Renewable Energy The EU’s electricity system is undergoing a rapid transformation, with wind and solar power leading the charge. As of the first half of 2024, wind and solar accounted for 30% of the EU’s electricity generation, surpassing the 27% generated by fossil fuels. This marks a pivotal moment in the EU’s clean energy transition, underscoring the growing importance of renewable energy sources. Decline in Fossil Fuel Generation Fossil fuel generation in the EU fell by 17% (-71 TWh) in the first half of 2024 compared to the same period in 2023. This decline is attributed to a significant reduction in coal and gas usage, which fell by 24% (-39 TWh) and 14% (-29 TWh), respectively. The drop in fossil fuel generation occurred even as electricity demand rebounded by 0.7% after two years of decline. Wind and Solar Power Surge in EU Wind and solar power were the primary drivers behind the reduction in fossil fuel generation. These renewable sources more than compensated for the increase in electricity demand, showcasing their growing capacity and efficiency. Wind and solar power collectively generated 386 TWh in the first half of 2024, outpacing the 343 TWh generated by fossil fuels. Country-Specific Achievements Several EU Member States achieved significant milestones in renewable energy generation. Germany, Belgium, Hungary, and the Netherlands, for the first time, generated more electricity from wind and solar than from fossil fuels during the January-June period of 2024. Overall, thirteen Member States surpassed this milestone, reflecting the widespread adoption and integration of renewable energy across the region. Structural Changes in EU’s Energy Mix The first half of 2024 highlighted a structural shift in the EU’s energy mix. Renewables, including wind, solar, and hydro, generated 50% of the EU’s electricity, a significant increase from previous years. This growth was supported by favorable weather conditions and substantial capacity additions in wind and solar installations. Renewable Energy Growth Wind Power : Increased by 9.5% (+21 TWh) compared to H1-2023. Solar Power : Grew by 20% (+23 TWh) over the same period. Hydro Power : Rebounded by 21% (+33 TWh) after two years of drought-affected low output. Emissions Reduction The decline in fossil fuel generation led to a significant reduction in emissions. Power sector emissions dropped by 17% in the first half of 2024 compared to the same period in 2023, continuing a trend from previous years. Emissions in the first half of 2024 were nearly a third (-31%) lower than in the first half of 2022, marking an unprecedented decline over such a short period. The Road Ahead While the progress in renewable energy adoption is commendable, sustaining this momentum will require continued policy support and infrastructure development. Easing barriers to wind and solar integration, such as improving grid connections, will be crucial to maintaining the pace of the clean energy transition. Policy and Market Dynamics The EU’s policies have played a significant role in accelerating the energy transition. Recent measures aimed at reducing dependency on fossil fuels and enhancing renewable energy capacity have yielded positive results. However, further acceleration is needed to meet the EU’s ambitious climate and energy targets. Future Projections Wind Capacity : Expected to increase by 15.8 GW in 2024. Solar Capacity : Forecasted to grow by 62 GW over the same period. Conclusion The first half of 2024 marks a new era in the EU’s energy landscape, with wind and solar power overtaking fossil fuels for the first time. This achievement underscores the EU’s commitment to a sustainable and clean energy future. Continued efforts to support renewable energy integration and infrastructure development will be essential to sustaining this positive trend and achieving long-term climate goals.

The Global Organic Textile Standard (GOTS) is the world's leading textile processing standard for organic fibres. It ensures environmental and social responsibility throughout the textile supply chain, from post-harvest handling to garment making. Here’s an in-depth look at the GOTS certification process, its benefits, and how Peterson Indonesia can help you achieve it. What is GOTS Certification? The GOTS quality assurance system is based on on-site inspection and certification of the entire textile supply chain, performed by independent, approved third-party Certification Bodies. This is a requirement of an ISO 14024 Type 1 environmental labelling program, ensuring that all certified products meet rigorous environmental and social criteria. Certification Process On-Site Annual Inspection: Operators, from post-harvest handling to garment-making and wholesalers, undergo an annual on-site inspection to maintain their certification. Independent Verification: Claims of GOTS compliance are verified through inspections and formal certification documents issued by independent Certification Bodies. Types of Certification Documents: Scope Certificates (SCs):  Prove a supplier meets all GOTS criteria. Transaction Certificates (TCs):  Confirm that specific goods meet GOTS product criteria. Benefits of GOTS Certification Credible Assurance:  Products labelled with GOTS logos are assured of having an organic origin and are processed in an environmentally and socially responsible manner. Comprehensive Coverage:  The entire organic supply chain, from harvesting to trading, is covered, providing credible assurance to end consumers. Independent Verification:  Certification is performed by third-party bodies, ensuring impartiality. Risk Management:  Acts as a risk management tool for buyers, protecting the health, safety, and rights of employees. Sustainability:  Certified entities can access the GOTS Monitor for water and energy consumption data. Only low-impact, GOTS-approved chemical inputs are allowed. Quality Assurance:  GOTS goods meet technical quality parameters like colourfastness and shrinkage. Product Variety:  Various products can be GOTS certified, including garments, home textiles, mattresses, and personal hygiene products. Elements of Inspection Bookkeeping Review:  Verifies the flow of GOTS goods through input/output reconciliation and mass balance calculations. Processing and Storage Assessment:  Inspections of facilities to ensure compliance. Chemical and Accessory Inspection:  Ensures only GOTS-approved inputs are used. Wastewater Treatment Inspection:  Assesses the performance of wastewater treatment systems. Social Criteria Check:  This includes interviews with management and workers to ensure ethical practices are followed. Approved Certification Bodies GOTS certification is conducted by approved bodies that perform on-site inspections. These bodies guide you through the necessary procedures and provide cost estimations based on your location, size, and operations. Each certification body may operate through local offices or head offices and is accredited to offer certification services for various scopes: Mechanical Textile Processing (Scope 1) Wet Processing and Finishing (Scope 2) Trading Operations (Scope 3) Approval of Textile Auxiliary Agents (Scope 4) Changing Certification Bodies Certified entities may need to change their certification body due to business reasons, closure of operations, or loss of accreditation. GOTS has a defined policy for such changes, ensuring a smooth transition. Certificates Scope Certificates:  Confirm compliance with GOTS criteria and are listed in the GOTS Certified Suppliers Database. Transaction Certificates:  Verify that specific shipments are GOTS certified, providing proof for buyers and facilitating further processing or trading. Consulting GOTS with Peterson Indonesia Achieving GOTS certification can be complex, but Peterson Indonesia is here to assist you. We have successfully guided numerous clients through the certification process. Our sustainability efforts and compliance expertise can help your business achieve GOTS certification seamlessly. Contact us today to start your journey toward a more sustainable future!

Youth Climate Conference 2024 On Saturday, July 27, 2024, the Forum Youth Climate Conference (YCC) gathered passionate young individuals at the National Research and Innovation Agency (BRIN) Auditorium in Jakarta. This pivotal event marked the launch of the "Declaration of Youth for Climate and Energy Transition," emphasizing the urgency of clean energy transition to achieve a Golden Indonesia by 2045. Organized by the Institute for Essential Services Reform (IESR) and supported by the Clean, Affordable and Secure Energy (CASE) for Southeast Asia Project, the YCC brought together over 200 participants, aiming to voice serious climate action to the government and industries. Key Recommendations for a Clean Energy Transition The Youth Climate Conference resulted in five significant recommendations for the government and industries to propel the clean energy transition: Reduce Dependency on Fossil Fuels:  To mitigate the climate crisis and ensure clean air free from coal combustion pollution. Utilize Renewable Energy:  Enhance access to energy in remote areas through renewable sources. Implement a Just Energy Transition:  To reduce greenhouse gas emissions, strengthen national energy resilience, and create new job opportunities. Protect and Restore Ecosystems:  Through policies that support adaptation to climate change. Involve Youth in Policy Making:  Ensure youth participation in formulating fair climate crisis and energy transition policies, providing learning opportunities for youth as change agents to achieve net zero emissions by 2060 or sooner. Youth Voices and Government Support Iklima Green, a representative and student from SMAN 4 Sukabumi, stressed the need for the Indonesian government to maximize the use of renewable energy, especially in the electricity sector. She highlighted the importance of ensuring that vulnerable groups, including people with disabilities and indigenous communities, benefit from renewable energy use. "As future leaders, we need the support and opportunities from stakeholders to be involved in policy-making," Iklima said, underscoring the importance of youth involvement to ensure sustainability, justice, and long-term commitment. Government Initiatives for a Golden Indonesia 2045 Ervan Maksum, Deputy for Infrastructure at the Ministry of National Development Planning (Bappenas), highlighted the ongoing development of the National Medium-Term Development Plan (RPJMN) 2025-2029 to realize the vision of Golden Indonesia 2045. The RPJMN includes five essential development frameworks: Enhancing Quality and Competitive Human Resources:  Through health and education. Building a Sustainable Environment:  Increasing resilience to disasters and climate change. Strengthening Infrastructure:  To support economic development and basic services. Improving Energy Efficiency:  Developing long-term energy scenarios supported by studies and public discussions. Creating and Expanding Jobs:  Especially in the green sector. Ervan emphasized the need for excellent human resources and innovation to achieve these goals, encouraging leadership development among youth to support the demographic bonus for Indonesia's future. Conclusion Fabby Tumiwa, Executive Director of IESR, emphasized the collective effort needed to ensure Indonesia's climate actions align with the Paris Agreement goals. He encouraged individual actions like using public transportation and renewable energy to make a significant difference. The Youth Climate Conference, supported by various civil society organizations, highlighted the crucial role of youth in climate action and the transition to clean energy. The Declaration of Youth for Climate and Energy Transition is a concrete commitment to drive the clean energy transition towards a sustainable and prosperous future for Indonesia.