Asian Agri Refuses to Source Illegal Palm Oil

As a successful entrepreneur owning large corporations, it is important to receive certifications from trustworthy third parties to ensure your credibility in quality and practices. It may not be an easy or fast process but it is a required step to ensure your accountability to the stakeholders. Asian Agri, one of the natural resources production companies under the direction of the RGE Group and its founder, Indonesian businessman Sukanto Tanoto, operates with a production capacity of 1 million tons of palm oil annually. Asian Agri, which is among the world’s largest manufacturers in its market sector, has committed its efforts to sourcing only legally obtained palm oil product. The company has recently placed an emphasis on requiring legal certification regarding the provenance of all freshly harvest fruit product from each third-party supplier and wholly independent farmer with whom it conducts transactions.

As part of its partnership with the local communities with whom it does business, Asian Agri has provided close to 29,000 smallholder families who farm its lands on Sumatra with a wide range of social and economic benefits. Of the company’s 160,000 hectares of total land area, some 60,000 are developed in cooperation with smallholding families who participate in its Plasma/KKPA programs. Mr. Tanoto remains highly engaged with the day-to-day operations of his companies and has charged each of them with maintaining a high level of transparency and responsiveness to their smallholders and to the public.

Legally harvested palm oil

Asian Agri has stepped up its focus on environmental good stewardship through increased attention to the problem of illegal palm oil entering the market. Through stringent attention to documenting that the produce it acquires is completely legal, the company hopes to build increased sustainability into the supply chain. Asian Agri also advocates for the closure of illegal palm oil plantations and for added efforts to protect forest land in the regions where it operates.

Illegal palm oil production and sales in Indonesia have created an economic system that will not be easy to eradicate. Several non-governmental organizations have expressed concern about the fact that some illegal palm oil continues to seep into the products of a number of high-profile manufacturers. Yet Asian Agri and several of its fellow palm oil producers plan to dedicate continued efforts to prevent deforestation, illicit land use, and environmental degradation.

 

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