Apical’s Commitment to Forests Apical Group Ltd., one of Indonesia’s chief processors and exporters of palm oil, is part of the RGE Group established by entrepreneur Sukanto Tanoto. Under Mr. Tanoto’s leadership, Apical has worked to show the industry that ensuring the greater social good also benefits bottom-line profits. Every entrepreneur should also be aware of the interconnectedness between social good and bottom-line profits. In today’s context, doing well in the business is not enough – every company should strive towards both doing well and doing good.
In September 2014, Apical announced its support for the provisions of the New York Declaration on Forests, a document signed during the United Nations Climate Summit held that month. Among other means of engagement, the summit offered an opportunity for the international private sector to discuss and promote business-based strategies for combating climate change. The New York Declaration includes a goal of cutting deforestation in half by the year 2020 and completely eradicating it by 2030.
The measure drew expressions of agreement from a broad spectrum of business and government leaders, as well as from indigenous communities, who are affected the most by the problem. Some experts noted that the document attempts to encourage businesses to build environmental sustainability into their existing value chains, and to realize that doing so can increase profits as well. Some corporations, such as Sukanto Tanoto’s Apical, have already demonstrated their understanding of these principles. Mr. Tanoto’s three-fold philosophy of doing good for the company, communities, and the planet is the guiding principle of Apical and the other natural resources manufacturing firms within RGE Group.
Apical maintains a membership in the Roundtable on Sustainable Palm Oil, and it is a founding member of the Business Council for Sustainable Development Singapore. The company’s history reflects its long-term focus on contributing to the social infrastructure of the communities in which it does business, and to pioneering solutions for food security and forest conservation. In addition, the company has pledged to monitor sustainability practices along its entire production and distribution chain.
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.
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.