Chip Off the Old Block: Anderson Tanoto Carrries on with the Good Work

Sukanto Tanoto is one of Asia’s most successful entrepreneurs, a reminder of what can happen with the right combination of graft, will, and ambition. The billionaire founder of APRIL, Sateri, and Pacific Oil and Gas currently helms RGE as chairman; RGE manages the various business groups mentioned amongst others. With a business worth 18 billion in assets and a workforce of 18,000 employees, Sukanto Tanoto has undoubtedly been a bona fide success.

Sukanto Tanoto’s success becomes all the more impressive once one considers the principled ways through which he has conducted his businesses. The veteran businessman strongly believes that businesses can profit by putting the community first, and the 5Cs principle that he espouses is testament to this belief. This principle, which emphasises the importance of doing good for the Community, Country, Climate, Customer, and Company, has unsurprisingly become a compass by which all his businesses find their direction. With 50 years of value creation and experience under his belt, Sukanto Tanoto’s legacy is rock solid, and looks set to continue through his son, Anderson Tanoto.

The rising star, the successor, the son

Chip Off the Old Block: Anderson Tanoto Carrries on with the Good Work

The youngest son of Sukanto Tanoto is a rising star in the business. The 28 year-old graduate of the famed Wharton School of the University of Pennsylvania is currently a Director at RGE, as well as a board of trustees member at Tanoto Foundation, the philanthropic arm started by Sukanto Tanoto and his wife, Tinah Bingei Tanoto.

Doing the right thing, the right way

While he may share the family name, Anderson Tanoto certainly took no shortcuts in his rapid rise to the top. Determined to learn the ropes right from the bottom, Anderson first gained experience as a consultant at Bain & Company, where he worked for two years; thereafter he made the switch to RGE as an assistant manager. It was a mark of his early maturity and vision, that he refused to be pushed straight into an upper management position, Anderson credits his success  to his understanding of the company at every level.

Today, Anderson Tanoto is masterful and self-assured, deservedly so; he is well respected for the many changes that have made RGE more transparent, efficient, and community-centric as the company moves into the digital age, which brings along its own set of opportunities and challenges. As Sukanto Tanoto celebrates 50 years of business, he is surely at ease, as Anderson waits in the wings to lead RGE through the next 50.

Three RGE Group Companies Honored with CSR Awards

At the end of November 2014, the Indonesian government’s Coordinating Ministry for Human Development and Culture and its Corporate Forum for Community Development presented the year’s Indonesia CSR Awards in a ceremony in Jakarta. Among the companies honored, out of a field of close to 40, were the RGE Group companies Riau Andalan Pulp & Paper, Asian Agri, and Toba Pulp Lestari. Founded by current CEO Sukanto Tanoto, a self-made entrepreneur, philanthropist, and one of Indonesia’s richest individuals, the $15 billion RGE family maintains a global corporate presence in pulp and paper milling, energy production and delivery, forestry operations, and palm oil production.

CSR Award
CSR Award

The CSR Awards each year provide the chance for Indonesia’s public sector to recognize successful community-building efforts by the private sector. In addition, the awards serve as a source of inspiration and examples of how effective corporate social responsibility programs operate.

In awarding a gold medal to Asian Agri for its Economic Empowerment program, the judges of the CSR Awards recognized the company’s partnership program between its PT Inti Indosawit Subur palm oil operation and the Amanah group of independent growers located in Ukui in Riau Province. The awards committee focused on the success of the partnership in implementing stated goals, and on the positive economic impact it had produced for members of local communities. Asian Agri’s officer in charge of corporate social responsibility, Benjamin R. Hutagalung, delivered a pre-awards ceremony presentation that offered details on the program.

Riau Andalan Pulp & Paper (RAPP), a division of the RGE company Asia Pacific Resources International Limited (APRIL), earned a silver medal for its work supporting a local loan and savings program in Teluk Binjai, Riau. Meanwhile, Toba Pulp Lestari’s two silver medals recognized its construction of a center to further early childhood education in Kabupaten Toba Samosir in North Sumatra, and its support for an evergreen nursery within the Taman Eden 100 conservation area.

Aksantara Team Builds Indonesia’s Best Aerial Robot of 2014

Students from Indonesia’s Bandung Institute of Technology recently won the Indonesia Aerial Robotics Contest (IARC) of 2014. Every year, the country’s Ministry of National Education and Culture sponsors the contest, which is the oldest collegiate aerial robot design competition in the world. The Aksantara team received first prize in the fixed wing category, as well as the best design award and the best presentation award for a university. Among the team’s supporters was the Tanoto Foundation, the nonprofit organization created by Indonesia’s Sukanto Tanoto, a self-made entrepreneur who concentrates on funding educational initiatives and other programs that can help lift underserved communities out of poverty. The Tanoto Foundation currently partners with more than two dozen Indonesian universities to award scholarships and to sustain other educational enhancement programs.

Led by aeronautics and astronautics student Rivaldy Varianto, the Aksantara group initially consisted of a small team of like-minded students that later expanded to welcome others studying in different areas of the institute. The team members built on what they had learned during the previous year’s competition to come back stronger in 2014. Speaking for the team, Varianto described the students’ hopes that their work can assist Indonesia in building its research and development capacity. Ultimately, they would like to see their country take a leading role in supplying global markets with advanced aerial robotic technologies.

Team Aksantara from ITB and their winning creation
Team Aksantara from ITB and their winning creation

Aerial technology, such as that produced through the IARC, can play a vital role in a nation’s disaster response and natural resource management capabilities by monitoring hazards such as forest fires. Sukanto Tanoto’s $15 billion RGE Group of corporations includes Asia Pacific Resources International Limited (APRIL), a wood pulp producer that aims to pioneer new, more effective methods for fire tracking throughout its agricultural concessions.

Through competitions such as the IARC, Indonesian higher education students can begin to assume their places as technologically sophisticated innovators in an increasingly competitive world.

 

Asian Agri Raises Sustainability Profile

In November 2014, Indonesian palm oil production company Asian Agri announced its certification at the ISCC PLUS level for the crude palm oil produced at all its mills. The event distinguishes Asian Agri as the largest producer of crude palm oil operating in Indonesia under such certification. The company had previously obtained ISCC certification for its palm kernel processing operations. The independent testing and verification organization SGS Germany provided the certification.

The ISCC (International Sustainability & Carbon Certification) program grants verification of a company’s compliance with relevant environmental best practices regarding sustainability and greenhouse gas emissions. In 2011, the ISCC system achieved recognition from the European Commission as one of the first certification programs to comply with the European Union’s Renewable Energy Directive of 2009.

The ISCC’s global system can be applied to multiple types of biomass products, and it provides a single framework that simplifies international commerce for a variety of businesses. Furthermore, the ISCC program looks at supply chains in their entirety, examining the process at every point from farm or field to end-user. This makes traceability up and down a supply chain far easier. To date, the ISCC has issued close to 5,000 certificates to forward-looking companies such as Asian Agri.

Through the ISCC PLUS certificate, Asian Agri demonstrates its ongoing commitment to economic, environmental, and social sustainability. The new certification will allow Asian Agri to increase its presence within the global marketplace, and to serve as an example for other palm oil production companies in maintaining environmentally sound operations. For this reason, Asian Agri also stands poised to assume a leading role in advertising the Indonesian palm oil industry as a significant player in the global sustainable economy.

Asian Agri, which works with some 29,000 smallholders families, is one component of the $15 billion RGE Group of corporations under the direction of founder and CEO Sukanto Tanoto of Indonesia. With operations established in 1979, Asian Agri now oversees 160,000 hectares of production land.

Palm Oil Fresh Fruit Bunch
Palm Oil Fresh Fruit Bunch

Niluh Djelantik Designer Part of Tanoto Entrepreneurship Series

 In late 2014, the Tanoto Entrepreneurship Series once again hosted businesspeople who have distinguished themselves by their success in Indonesia. A project funded by the nonprofit Tanoto Foundation in partnership with the economics faculty at Universitas Indonesia, the lecture series has previously drawn luminary speakers such as Indonesia’s recently elected president, Joko Widodo. As part of the Tanoto Foundation’s goals of supporting individual entrepreneurial development and public education programs, the series strives to offer students practical knowledge based on the experiences of well-known businesspeople.

Niluh Putu Ary Pertami, the designer and creative director behind the luxury footwear brand Niluh Djelantik, joined Garuda Food CEO Sudhamek AWS to take turns at the podium. Niluh, whose brand is now available in fashionable European retail outlets, gained her love for style early in life. During her youth on the island of Bali, her family was not wealthy, and her mother routinely bought Niluh’s school uniforms and shoes several sizes too big, in order to economize the cost over several years’ growth. However, her mother also encouraged her ambitions, and sent Niluh to study business in Indonesia’s capital city of Jakarta. There, the young entrepreneur learned organizational and professional skills through both study and practical, on-the-job training.

Niluh Djelantik Shoes
Niluh Djelantik Shoes

Her lecture to the Tanoto group of student entrepreneurs focused on her experience as the head of a brand that it took her a decade to launch from one small local manufacturing shop onto the international stage. She believes in seizing opportunities as they arise and dedicating constant attention to improvement and innovation.

Sukanto Tanoto’s RGE Group of corporations, through its founder’s vision and dedication, has earned a significant share of the world’s business in energy development, palm oil and wood pulp production, and other manufacturing industries. Mr. Tanoto’s personal and professional focus on constant analysis, development, and innovation echoes the themes in Niluh’s address to the students. Through the Tanoto Entrepreneurship Series, he hopes to continue to assist emerging young business leaders with their efforts to drive economic and social growth in Indonesia.

Tanoto Entrepreneurship Series Features Sudhamek AWS

The Tanoto Entrepreneurship Series, funded by the Tanoto Foundation in collaboration with the economics faculty of Universitas Indonesia, aims to be a strong weapon in the fight against poverty in the Southeast Asian nation by providing education and support for student entrepreneurs. This lecture series engages distinguished entrepreneurs as guest speakers to address the practical needs of today’s students and emerging business professionals. Through the generosity of Indonesian-born entrepreneur Sukanto Tanoto, the series has hosted guests that include current Indonesian president Joko Widodo.

The most recent lecture series, held in Jakarta in October 2014, featured presentations from two well-regarded names in Southeast Asian business: Sudhamek AWS, the chief executive officer of Garuda Food, and Niluh Putu Ary Pertami, creative director of the Indonesian shoe brand Niluh Djelantik. The two successful businesspeople shared their secrets and their insights with the Tanoto Entrepreneurship Series’ graduate program students and recipients of Tanoto Foundation educational scholarships.

Sudhamek AWS offered information based on his experiences heading one of the region’s best-known food brands. Given the fact that Indonesia’s infrastructure still needs to make substantial progress before it can facilitate consistent delivery of goods and services, he has faced major obstacles in implementing his corporate strategy. Nevertheless, he believes that dedication to hard work and constant learning are necessary keys to success. Sudhamek praised the Tanoto Entrepreneurship Series as a means for business leaders to share their own early struggles in a way that will make the road easier for those who follow.

Sukanto Tanoto himself serves as an illustration of Sudhamek’s ideas. As a self-made entrepreneur who has pursued a lifelong course of formal and self-directed education, Mr. Tanoto places great value on learning. Through the Tanoto Foundation and its Entrepreneurship Series, he hopes to share the insights he and other leaders have gained, in order to support the efforts of everyone who has the potential to assist the economic growth of Indonesia.

 

Sudhamek AWS (2nd from L) with Imelda Tanoto at Tanoto Entrepreneurship Series 2014
Sudhamek AWS with Imelda Tanoto at Tanoto Entrepreneurship Series 2014

Tanoto Entrepreneurship Series Supports Students’ Business Endeavors

Sukanto Tanoto is proud of his history as a self-made entrepreneur. The Indonesian-born son of Chinese immigrant parents, he grew up in modest circumstances helping out in his father’s business. While still a young man, Sukanto Tanoto built on his father’s small company, learned everything he could about business practices and methods, and made shrewd strategic moves that earned him success. Now, Mr. Tanoto is among Indonesia’s richest individuals. He heads the RGE Group of companies, which he has grown over the years to a total worth of approximately $15 billion. By utilizing his philosophy of diversification and practicing wise stewardship of corporate and environmental resources, Mr. Tanoto has managed to weather multiple international business storms.

He concentrates on giving back to the struggling students of today through the Tanoto Entrepreneurship Series, held in collaboration with the Magister Management Program within the economics faculty at Universitas Indonesia – Tanoto Entrepreneurship Series 2014. The series brings successful entrepreneurs to present public lectures to a wide audience of students and would-be businesspeople. Through these talks, aspiring young entrepreneurs can begin to understand the entrepreneurial mindset, gain practical advice on starting and running their own businesses, and forge connections with notable leaders in a variety of fields. Among the past lecturers in the series is Indonesia’s newly elected president, Joko Widodo.

Imelda Tanoto at Tanoto Entrepreneurship Series 2014
Imelda Tanoto at Tanoto Entrepreneurship Series 2014

Currently, the percentage of Indonesia’s population working as entrepreneurs is about 2 percent. Studies point to the fact that, if a nation is to boost its economic growth, that is the bare minimum level of entrepreneurial experience necessary. Sukanto Tanoto believes that starting out young enables an entrepreneur to approach problems and challenges with a fresh outlook, large reserves of energy, and the free time necessary to create truly innovative solutions. By beginning his own entrepreneurial life so young, he believes that he was able to develop positive habits, such as resilience and determination, that fueled his later success.

In order to further the goals of individual students, as well to assist his entire country in alleviating the problem of poverty, Mr. Tanoto is pleased to offer the lecture series and associated educational funding and scholarships.

To watch more about the Tanoto Entrepreneurship Series, please click here.

APRIL Pioneers Holistic Strategies for Fire Control

Asia Pacific Resources International Limited (APRIL), one of the many companies operating under the Royal Golden Eagle (RGE) corporate group headed by Sukanto Tanoto, has embraced a zero-burn policy on its wood pulp-producing plantation lands in Indonesia since its inception in the mid-1990s. Following Mr. Tanoto’s direction, all of RGE Group’s natural resources manufacturing companies strive to implement best practices in conservation and land use. In APRIL’s case, this has involved extensive cooperation on fire management with government agencies, local communities, and non-governmental organizations focused on environmental issues. In addition, APRIL has implemented wide-ranging policies and procedures that have proven their usefulness in reducing and eliminating fires throughout its home base in Riau Province on the island of Sumatra.

Taking a 360-degree view of the situation, APRIL has instituted high-level fire-detection systems, community education and awareness programs, and an innovative incentive pilot project designed to reward villages successful in preventing and containing fires. In addition, through the blog APRIL Dialog, the company works to demonstrate transparency in addressing issues of concern to local populations living near its lands and to the larger environmental community.

Unchecked fires on plantation lands have presented serious health, safety, and environmental hazards for decades in Indonesia. In addition, when the haze from those fires spreads across borders into Singapore and Malaysia, it presents a situation that the United Nations has elevated to the level of a world crisis. APRIL has made significant strides in addressing the problem through an investment of $6 million to provide an aggressive response to fires on lands bordering its own, realizing that containing the spread of fire is the responsibility of all stakeholders.

In addition, in November 2014, APRIL once again took a leading role by participating as both a sponsor and an exhibitor at Singapore’s first public exhibit to focus on the problem of haze. The exhibit was named “Haze: Know it. Stop it.” and sought to educate citizens about the causes that contribute to pollutant haze in the country.

APRIL at Singapore Haze Exhibition

 

Law Professor Strives to Understand Singapore’s Haze Problem

Simon Tay is a professor of international law at the National University of Singapore, the founder of the Singapore Institute of International Affairs (SIIA), and a former three-term Nominated Member of the Singapore Parliament. In addition, he serves as a powerful voice on topics affecting the quality of life for all Singapore’s people. In November 2014, Tay authored a piece for The Straits Times, one of Singapore’s leading newspapers, on his “personal journey” through the environmental issues surrounding the haze problem plaguing his country and the greater region.

In the article, Tay discussed the complex nature of the problem. Recurrent clouds of smoky haze originating largely from forest fires in Indonesia have crossed the Strait of Malacca for decades, blanketing Singapore and Malaysia. The elderly and young children are particularly vulnerable to the respiratory conditions and other health problems associated with this type of pollution.

The rapid boom in natural resources-based manufacturing taking place within Indonesia’s developing economy is the ultimate cause of the haze, which sometimes comes from fires that ignite on plantation lands owned by large corporations. In other instances, small farmers, without a direct affiliation with a corporate partner, may set fires on their own or company-owned lands through lack of education about the environmental impact, or deliberately as the cheapest means of clearing lands for cultivation.

Attributing the fires to specific sources has proven difficult, even for experts, because of unclear demarcation of land boundaries on current maps, as well as the limited technological means for verifying details about the causes of the fires.

Tay has long maintained a deep concern about the transnational haze problem. When it came most prominently to his attention, in the late 1990s, the Indonesian government was in a deep political and economic crisis, with little ability to fight the raging fires that the United Nations had declared a global disaster situation. In the years since then, new national and international laws have attempted to bring order to the problem, with varying degrees of success.

SIIA/NUS guests in Kerinci with Anderson Tanoto and APRIL’s fire management team
SIIA/NUS guests in Kerinci with Anderson Tanoto and APRIL’s fire management team

On a recent trip to the Indonesian island of Sumatra, Tay spent time with Anderson Tanoto, who represented the RGE Group of manufacturing companies founded by his father, Sukanto Tanoto. Tay wrote of his tour of lands under cultivation by APRIL (Asia Pacific Resources International Limited), the RGE company dedicated to producing wood pulp products, and by Asian Agri, another RGE firm devoted to palm oil production for a global market. Tay was impressed with APRIL’s and Asian Agri’s focus on containing and fighting fires in a systematic manner, and with the companies’ commitment to sustainable practices. As Anderson Tanoto pointed out, it makes good business sense for a natural resources-based company to keep environmental stewardship foremost in its planning. Without careful oversight of wildfires and other hazardous conditions, APRIL and companies like it would lose the very raw materials they depend on for their livelihoods.

 

Jusuf Kalla’s Statements during Tanoto Entrepreneurship Series 2013 Part 3

On the final post for Jusuf Kalla’s statements made during the Tanoto Entrepreneurship Series on 30 April 2013, he touched on the importance of having the right attitude during the start up and growth stage of a venture. In fact, attitude is one of the most important determining factors to the success of a business.

In any start up, the process has to be gradual and step by step; and hardships will definitely pay a visit during this process. RGE, owned by Sukanto Tanoto, and all the companies under the group, faced many difficulties and hardships throughout the growth stage of the venture. These difficulties vary from internal to external situations and come in different sizes. Nevertheless, having a high resilience enabled the company to always bounce back stronger after every crisis it faced.

Jusuf Kalla at Tanoto Entrepreneurship Series
Jusuf Kalla at Tanoto Entrepreneurship Series

Jusuf Kalla also mentioned the importance of innovation. Taking a glance at the businesses present in the market, many of them started because people were not comfortable in a certain situation, thus, were forced to think out of the box to innovate and improve. For example, the number of retail stores such as Seven Eleven, Alfamart or Indomart in Indonesia has grown significantly because people do not enjoy going to wet market anymore. They would rather go to stores that are clean and comfortable.

He also pointed out that given the better access to information and the availability of technology at your fingertips nowadays, it is relatively easier for young people nowadays to innovate. The point is to have courage to be an innovator and not a follower. Most of the innovations seem impossible at the beginning however, many of them were proven to be possible.

It is however, not wise to rely on intuition when making a decision. Even though it is true that a good intuition comes with a great deal of experience, Jusuf Kalla advised that we still need to carry out our actions based on calculated risks. This is because as an entrepreneur, absorbing the risks comes as a package together with the results we reap. In order to do an accurate calculation of risk, we need information as the basis. RGE has also invested heavily on Research and Development to continuously improve on their processes and products. Besides this, there is also a bottom-up continuous improvement activities that enable employees to spearhead innovations and process improvements.

Jusuf Kalla’s statements suggest that he will ensure the availability of necessary technology and internet access in the nation in order to support and provide the massive amount of information required in a growing economy.