Results of the Company's Management Activities in the Last 5 Years.

Chapter 4.

RESEARCH RESULTS AND DISCUSSION

4.1. Results of the Company's QLR activities in the last 5 years.

4.1.1. Forest management and management organization:

Land management: The company has used the allocated land for the right purpose, not arbitrarily changing the purpose of use. Implementing the form of contracting and joint venture, forest planting association to share products at the end of the cycle. Ensuring the correct forestry technical process. Planting all the allocated land area, the planted forests grow and develop quite well without any bad forests;

The company has converted the forestry farm to operate under the model of a forestry company in line with international economic integration. The company's organizational structure is streamlined. Each manager is assigned clear tasks, and the quality of work is highly effective. Forests and forest land are well managed, 100% of the company's planted forest area is contracted to workers. Forests are replanted immediately after exploitation, leaving no vacant land.

4.1.2. Applied techniques and technologies.

The company has planted intensive forests, applied the process of planting and exploiting NLG forests issued in Decision No. 1517/QD-HDQT dated November 6, 2002 of Vietnam Paper Corporation. The company has introduced new high-yield tree varieties into the forest, such as Acacia mangium BV10; BV16; BV32; Eucalyptus Europhila; the forest growth rate is good.

Forest exploitation applies minimal impact exploitation technology: felling with chainsaws, manual transportation to minimize negative impacts on the environment.

4.1.3. Use of land, infrastructure, capital.

The company uses land effectively, replanting forests as soon as they are exploited. The company has 4 production teams, basically built for long-term and stable production. The annual investment capital for forest planting is preferential loans from the Vietnam Development Bank, meeting 70%, the rest is supplemented by the company itself and mobilized from staff and workers.

4.1.4. Mining and transportation equipment:

TABLE 03: STATISTICS OF MINING AND TRANSPORTATION EQUIPMENT

No.

Device Name	Quantity (pieces)	Value (million VND)	Owner
Device Name	Quantity (pieces)	Value (million VND)	Company %	Rent %
1	Mining equipment:
-	Chainsaw	04 pieces	48		48
2	Transport equipment:
-	HYUNDAI Car (11 tons)	04 cars	1,200		1,200
-	IFA Car (5 tons)	04 cars	800		800

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4.1.5. Production and business results:

TABLE 04: 5-YEAR PRODUCTION AND BUSINESS RESULTS (2010-2014)

Category

Unit of measure	Year 2010	2011	2012	2013	2014	Total	Average success rate /year
1. Afforestation	ha	120.2	151	180	137.1	218.4	900.1	180.2
2. Exploitation
- Output	m3	10,388	6,832	5,816	12,347	7,485	42,868	8,573.6
- Mining area	ha	218.9	145.6	91.2	199	129.5	784.2	156.8
- Forest productivity	m3 / ha	47.5	46.9	63.7	62.0	57.8	277.9	55.6
3. Revenue	tr.đ	6,752	4,474	4,996	14,474	7.102	37,798	7,599.6
4. Interest	tr.đ	9.0	16.33	48.49	188,416	119.6	381,836	76,367
5. Submit budget	tr.đ	2.0	2.0	2.0	2.0	2.0	10.0	2.0
6. Pay social insurance	tr.đ	391	366.1	322.73	442.8	443.4	1,966	393.2
7. Average salary/person/month	tr.đ	2.2	4.6	5.2	4.5	4.5	21.0	4.2

Production forest plantation for 5 years: 900.1 ha, average 180.2 ha/year. Of which: Planted on Company land: 900.1 ha, accounting for 100%; Exploitation output 8,573.6 m 3 /year, average yield 55.6 m 3 /ha.

The production and business situation of the unit is stable and developing. The company has fulfilled all its obligations to the state, ensuring policies for employees such as salary, bonus, social insurance, health insurance, labor protection... The rights and interests of employees are guaranteed.

4.1.6 . Environmental impact:

4.1.6.1. Positive aspects

On May 6, 2011, Song Thao Forestry Company was granted a sustainable forest certificate. Since the Company entered the FSC sustainable forest certification group, the Company has planted forests, increasing forest cover from 63% in 2010 to 89.8% in 2014.

Collection of packaging, plastic bags, and waste: At the forest planting site, nursery, exploitation shed, households of staff, the Company office, and team units have been collected and transferred to Vietnam Paper Corporation for treatment according to regulations.

Soil erosion monitoring: The company regularly monitors, inspects and supervises, and organizes good protection to prevent people and livestock from encroaching. The Technical Planning Department monitors, supervises, collects data and reports monitoring results annually.

Stream corridor protection: The Company has coordinated with local authorities of communes in the area; Ha Hoa District Forest Protection Department, Cam Khe District Forest Protection Department to regularly patrol and manage forest protection, protect stream corridors, creeks and canals; and forest areas that are vulnerable to encroachment.

The company mainly plants Acacia mangium, a legume with nodules in its roots that naturally fix nitrogen, which helps improve the soil and increase humus in the soil by creating a layer of litter from Acacia leaves; contributing to increasing forest cover in the district, regulating water resources, preventing erosion, limiting floods, and absorbing carbon. Forests retain water, increasing the amount of groundwater in the soil. Contributing significantly to climate regulation, changing the temperature regime, wind speed, protecting crops, and making

clean air; improve environment, humidity of microclimate. Forests increase biodiversity, are the shelter and habitat of many species of animals and plants.

4.1.6.2. Limitations:

Use of pesticides: Song Thao Forestry Company uses NPK chemical fertilizers for tree care and some chemicals to prevent pests and diseases in the nursery. However, due to the short nursery period (from 4 to 5 months), it has little impact on the environment.

Environmental impact due to vegetation treatment and clear-cutting : Before planting forests, the Company must conduct comprehensive vegetation treatment by burning or clearing in strips; after clear-cutting, there is a period when the ground is not covered, but this is the period of late winter, early spring, when there is little or no heavy rain, so there is no soil erosion.

The accuracy between the map and the actual area of the streamside corridor protection area in Team 1 is still inaccurate. The streamside corridor protection area in Ao Gioi area has many trees ,

The trees after exploitation are still in the buffer zone.

4.1.7. Social impact:

4.1.7.1. Positive aspects:

Every year, Song Thao Forestry Company plants about 130.0 hectares of forest with a total of 29,500 workers planting, caring and protecting the forest each year; Exploitation stage is about 8,500m3 with 25,500 workers; Closed canopy forest protection is about 650 hectares with a number of workers: 4,750 workers. Combining all 3 stages of planting, exploiting and protecting the forest, every year the company has created more jobs for 180 local workers with 59,750 working days and an amount of 5,377 million VND; annual social fund contribution is from: 35-40 million VND. The streamside corridor is well managed and protected, the stream bed is clean and hygienic to ensure normal flow.

Every year, the Company also leaves thousands of steres of firewood and branches as fuel to serve the fuel needs of the people in the surrounding area, reducing the impact on the forest. In sowing and planting forests each year, the Company proactively sows and plants from 400-

500,000 good quality seedlings, not only for the Company's forestation but also for local households.

Contribute to supporting local socio-economic development: Every year, the Company supports the maintenance costs of residential roads, public works, and other socio-cultural activities with about 15-20 million VND.

The relationship between the Company and local people is always closely connected. Through cooperation with households to plant forests, take care of forests, receive contracts to manage and protect forests throughout the cycle, the forest exploitation stage with the Company has brought annual income to the people in the area from 2.0 billion VND to 2.5 billion VND. People's lives have improved, the level of education has gradually increased; no social evils or negativity have occurred...

4.1.7.2. Limitations:

The management capacity of team leaders is still limited, their pedagogical level makes them confused and lacks confidence in presenting reports, and their document storage is unscientific.

The phenomenon of land encroachment disputes left by history still occurs. But it has been promptly resolved by the local government and the Ha Hoa district forest rangers.

4.2. The Company's management errors in 2014 and how to overcome them

4.2.1 The Company's 2013 QLR performance indicators were evaluated in 2014

Troubleshooting Request: 01/13

Standards and requirements: Rainforest Alliance Interim Standards for Assessing Forest Management in Vietnam (Version: 01/06/2010) Indicator 4.1.2
Error description and equals		The contract will be awarded through a transparent process.
Related evidence:		transparently based on clear criteria, and justify the
		The final choice is documented.
Big	Small: x
		Song Thao Forestry Company uses legal labor.
		seasonal and seasonal for planting, pruning and operation
		exploitation. However, there is no labor contract here.
		specifically provided for seasonal workers.
		This is not in compliance with national labor laws and policies.
		Company's own job listing.

Remedial action required:

The Company shall take corrective action to demonstrate compliance with the relevant requirements above.

Note : Effective corrective actions are directed at addressing the specific problems described in the evidence above, as well as addressing the root causes to eliminate and prevent recurrence of noncompliance.

Time to fix:	Before next annual monitoring (2014)
Evidence providing organization	Contract of a team leader, chainsaw worker (full-time contract) and a miner (seasonal contract).
	During the previous assessment period, the Company considered
	and execute contracts for all employees.
	including full-time and seasonal workers.
	For full-time employment contracts with contracts
Findings on Evidence Evaluation	For permanent labor, the contract is a "permanent contract". For seasonal labor, the contract is a "seasonal contract". This time, sample a mining team leader (contract)
	long term), a chainsaw worker (full time contract)
	time) and a miner (seasonal contract)
	to evaluate and find compliance with local laws
	This NCR error is closed.
Error status	Close

Troubleshooting Request: 02/13

Standards and requirements: Provisional standards of

Rainforest Alliance for assessing forest management in Vietnam Version 01/06/2010) Indicator 4.2.3

Error description and related evidence:

The company will identify places where accidents often occur to take appropriate preventive measures and train workers.

Big

Small: x	practices on the maintenance and operation of hazardous materials and equipment According to the company's employment contract and training policy, miners will be trained in occupational health and safety, personal protective equipment, working methods, etc. However, based on sample testing of a male miner at mining site No. 5, Lot No. D1, there was no evidence of see the training that has been provided.
Remedial action required: The Company shall take corrective action to demonstrate compliance with the relevant requirements above. Note : Effective corrective actions address the specific occurrences described in the evidence above, as well as addressing the root causes to eliminate and prevent recurrence of noncompliance.
Time to fix:		Before next annual monitoring (2014)
		- Safety control procedures for all planting activities
		forests and harvesting processes including activities in
		Sloping land area - Company's safe working regulations
		No. 15b QD-KHKT dated January 10, 2011;
		- Annual safety training records for leaders and supervisors
Providing organization		and miners on January 8, 2014;
proof		- Document of plan for distribution of labor protection equipment
		PPE Circular No. 65/KH-LD dated February 22, 2014;
		- Minutes of distribution of PPE labor protection equipment
		February 22, 2014;
		- Annual health check-up records for 44 employees and
		workers 18/11/2013.

The company has reviewed and established safety control regulations.
	safety for all forest planting activities and exploitation processes
	Waterfalls include activities on steep areas.
	large and provide appropriate training to employees involved
	mandarin.
	Review of safe working regulations No. 15b/QD-KHKT
	October 1, 2011 found that aviation safety training courses
	year is conducted for all leaders, supervisors
	and mining workers. Safety training is provided.
	implemented on January 8, 2014 for 44 employees and workers
Detected during evaluation	action of 04 teams.
proof	Technical specifications of labor protection equipment and
	The distribution plan is decided each year. Text
	of the plan for distributing labor protection equipment No.
	65/KH-LD dated February 22, 2014 at the Company was inspected.
	with clothes, helmets, hats, shoes, gloves and
	Masks have been distributed. Equipment distribution minutes
	labor protection equipment on February 22, 2014 is available. The company has
	Conducted annual health check-ups for 44 employees
	and workers on November 18, 2013.
	This CTT error is closed.
Error status	Close

Troubleshooting Request: 03/13

Standards and requirements: Rainforest Alliance Interim Standards for Assessing Forest Management in Vietnam (Version 01/06/2010) Indicator 5.5.2
Error description and related evidence:	The Company shall protect riparian areas along water sources, streams, lakes, streams and lakes/ponds, in accordance with the requirements of the regulations.

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