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nglo-Dutch company Unilever has suspended all future purchases of palm oil from Indonesia's PT SMART, a subsidiary of the Sinar Mas Group, citing the supplier's failure to meet the "highest possible" sustainability standards.

The company said in a statement issued Friday that the suspension would remain in place until SMART could provide verifiable proof that none of its plantations contributed to the destruction of high conservation value forests or expanded into peatlands.

Unilever said that over the past 18 months, it had been scrutinizing the activities of its suppliers to verify their compliance with standards set by the Roundtable on Sustainable Palm Oil (RSPO).

The RSPO, which also includes Sinar Mas, is a self-regulating body aimed at preventing illegal forest clearance. Environmental groups have criticized it as toothless and an obstacle to independent scrutiny.

The Times reported Friday that Unilever decided to suspend the annual contract worth *20 million (US$32.5 million) after it obtained photographic evidence of Sinar Mas clearing protected rainforests, including reserves for Indonesia's endangered orangutan population.

"We have received very serious allegations against Sinar Mas and we had no choice but to suspend future purchases from them," Unilever's vice-president for communications, Gavin Neath, told The Times.

The environmental NGO Greenpeace published this week a report detailing serious allegations against Sinar Mas' environmental practices.

Following up on the report, Unilever decided to take immediate action.

Marc Engle, Unilever's chief procurement officer, said the Greenpeace claims could not be ignored.

"Unilever is committed to sustainable sourcing. Therefore we have notified PT SMART that we have no choice but to suspend our future purchasing of palm oil," he said.

"If PT SMART is able to come forward with concrete proof that it is not involved in unacceptable environmental practices, then we would certainly reconsider our position."

Sinar Mas managing director Gandhi Sulistyanto condemned Greenpeace for its actions, detikfinance.com reported, saying the group was being steered by other stakeholders with vested interests in undermining the company.

A spokesperson for the company said a press release would be issued Saturday to counter Unilever's claims.

The growth of Indonesia's palm oil industry is blamed for turning the country into the world's third-largest emitter of CO2 after China and the United States.

Indonesia also has the fastest rate of deforestation, losing an area the size of Wales every year.

Deforestation contributes between 15 and 20 percent of global greenhouse gas emissions. The issue is also one of the key issues being debated at the Copenhagen climate change summit.