By Muhamad Al Azhari on 10:29 am Jul 25, 2013Category Business, Corporate News
Tags: Indonesia pulp and paper industry, Royal Golden Eagle RGE
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Royal Golden Eagle’s Next Generation Seeks New Leaf
Anderson Tanoto, 24, is tipped as the favored successor to lead the family business Royal Golden Eagle. (GA Photo/Suhadi)
Kerinci, Riau. A leading figure among the next generation of leaders at family-run conglomerate Royal Golden Eagle hopes to take a different approach to his forebears on the environmental concerns that have long dogged the company.
Pledging the company’s long-term commitment to Indonesia, Anderson Tanoto, 24, says it wants to reset its relationship with green activists who have criticized the practices of its pulp and paper business.
“It is the aspiration of the second generation that we be more interactive with the environment to navigate a changing world,” Anderson told reporters, including the Jakarta Globe, invited to a company gathering in Kerinci.
Anderson is an assistant manager at Asia Pacific Resources International Limited (April), a management company based in Singapore that controls the conglomerate’s pulp and paper businesses.
He is the youngest son of Sukanto Tanoto, the 63-year-old current company leader who is ranked number 10 on this year’s Globe Asia rich list with a net worth of $2.1 billion.
Analysts say Anderson is the favored successor to lead the family business, which stretches from pulp and paper to energy to agriculture.
The pulp and paper operation is regularly attacked by environmental activists for contributing to deforestation in Indonesia. Greenpeace has described April as the “largest driver of deforestation in the sector.”
In response, Anderson said: “It is not that we don’t want to interact with them , but it must be on the same playing field.”
Anderson said the group prefers to avoid pointing fingers at campaigners.
“We want it [the relationship] to be constructive,” he said. “If you are curious about how we run our business, just ask people around. In fact we have set a specific $17 million budget for Kampar restoration.”
In Kampar, Riau, a company affiliated with April has pledged to spend up to $17 million over 10 years to restore a peat forest. The program is aimed at protecting rare animal species, including Sumatran tigers, and also one of the world’s largest natural carbon-absorbing areas.
The program will cover 20,265 hectares of Kampar’s 700,000 hectares of peat swamp forests and mangroves. Its budget represents just over 0.1 percent of Royal Golden Eagle’s total assets.
Greenpeace has recently voiced concerns about the condition of the area being protected. It claims that Kampar had been environmentally damaged by illegal loggers, who contributed to forest burning, hurting the stability of the peat swamp hydrology.
“Five years ago, we stood silent on such accusations. … [Now] we want to promote transparency,” Anderson said.
Diverse empire
The Tanoto family’s RGE has more than $15 billion in total assets and directly employs around 50,000 people worldwide, according to a company document.
“We have been here for 20 years. … We will continue investing in Indonesia. We will not only invest in the economy directly, but also invest in people,” Anderson said.
“There is a huge prospect in Indonesia. This country has a population of around 240 million. … Not only from the population side, in its demography, we have a big proportion of young-aged population.”
Sukanto’s first plantation development begin in Kerinci in 1993 through Riau Andalan Pulp and Paper. Its first commercial pulp production began in 1995 and commercial paper production started in 1998.
Sukanto’s pulp and paper business has grown significantly since then. Under April, Sukanto built his pulp and paper business into one of the largest pulp mills in the world. April controls RAPP, Riau Andalan Kertas (a paper maker) and Riau Power (a power producer) to support an integrated pulp and paper business.
On its 1,750-hectare manufacturing complex, April produces 2.8 million tons of pulp and 820,000 tons of paper per year. Its PaperOne office paper product is sold in more than 75 countries.
In agriculture, Sukanto owns Asian Agri Group, comprising palm oil producers that have been operating in Indonesia since 1979. The group now manages 28 oil palm plantations and 19 palm oil mills.
It controls a total plantation area of 160,000 hectares, of which 60,000 hectares is developed with smallholders under Plasma Schemes.
Tax sagaAsian Agri has been embroiled in a years-long tax saga. The Supreme Court on Dec. 18 last year ordered it to pay Rp 2.52 trillion ($261 million) in back taxes and fines for tax embezzlement.
The verdict came after a review in a criminal case of tax evasion involving Suwir Laut, Asian Agri’s former tax manager. Suwir was found guilty of misstating the annual tax notice of Asian Agri’s 14 subsidiaries from 2002 to 2005. He was sentenced to two years in prison with a three-year probation period. The investigation began in 2007.
Asian Agri plans to defy the court ruling. It claims it has already paid some of the amount due, and other taxes are still in dispute with the tax office, rendering the latest court order non-executable. It also intends to request a judicial review on the case, saying the judges and overlooked some evidence and the ruling contained contradictions.
“There are many judicial processes that are not balanced here,” Anderson said.
As evidence for challenging the court ruling, he said the prosecuting attorney had used evidence from Vincentius Amin Sutanto, a man sentenced to 11 years in prison for attempting to embezzle $3.1 million from Asian Agri.
Vincentius is now out on parole as a reward for providing evidence in the tax fraud case. “Evidence must come from a reliable source,” Anderson said of the basis for a sound conviction.
RGE also has operations in China, through Asia Symbol, a pulp producer, and owns Pacific Oil & Gas, an independent energy resources development. In Brazil, RGE owns Sateri, one of the world’s largest specialty cellulose producers.
Monday, 17 March 2014
Tuesday, 4 March 2014
Anderson Tanoto Observe Riau Ecosystem Restoration Program In Kampar Peninsula
Ecosystem restoration is an effort to restore elements of biological (flora and fauna) and non-biological elements (land and water) in an area with native species, in order to reach equilibrium and its ecosystem.
Anderson Tanoto, as the next generation Sukanto Tanoto, works as a Management Committee who participated RER to go to the field to observe directly the state of Riau Ecosystem Restoration (RER) in Kampar Peninsula.
In this event, Anderson Tanoto also accompanied by Tony Whitten, a member of the Advisory Board of the RER which is also the Asia-Pacific Regional Director of Fauna & Flora International and Special Staff of the Minister of Forestry, I Made Subadia Gelgel .
RER is a long-term ecosystem restoration program initiated by APRIL (Asia Pacific Resources International Limited) together with several partners who have committed to joint efforts to protect and restore tropical forests in the Kampar peat. RER partners in the program include APRIL international conservation organization FFI (Fauna & Flora International) which has a rescue program fauna and flora species and its habitat while improving the welfare of local communities in 40 countries, and “Bidara” an organization engaged in social activities and community empowerment .
Chairman of the Management Committee of the RER, Tanoto Anderson, who is also chairman APRIL explain that Meeting of the Advisory Board and Management Committee RER agreed work program that will guide the activities of the RER over the next few years. The work program is divided into four components, namely: ( 1 ) Restoring ecosystems and ensure sustainable management of ecosystem restoration concessions; ( 2 ) Protecting endangered species and ecosystems of peat; ( 3 ) Prevent the occurrence of greenhouse gas emissions, and ( 4 ) Ensure contribution towards improving the welfare of local people, especially those whose lives depend on the resources in and around the concession RER."
The meeting also agreed on the adoption of the standard CCB (Climate, Community and Biodiversity) as a reference for the RER Management Committee to carry out ecosystem restoration program .
"CCB will complement the RER commitment to implement ecosystem restoration program based on the regulations set by the Indonesian government," he added.
"That's all it is not easy, but with the support of partners who have a strong commitment, adequate resources, high competence and extensive experience, together we will make the best effort to ensure that the program could RER managed to protect and restore forests Kampar peat for sustainability,"said Anderson Tanoto optimistic.
Interview with Sukanto Tanoto: An Indonesian Businessman
Publication: Fortune China 《财富》
Author: Wang Yiding (王亦丁)
Date: January 2008
An Indonesian businessman has been blazing a trail between China and Southeast Asia. He is none other than Indonesia’s richest Chinese businessman Mr Sukanto Tanoto. His RGM International has been busy reinforcing relations with China. From time to time, his four children accompany him on his trips to China, but this does not mean that he is planning his succession. “I have always believed in those of my employees who worked their ways up instead of those who rely on me or their connections with me,” he said.
A self-made businessman, Mr Tanoto has inculcated an even more useful business philosophy: Be a good shareholder. Though three of his four children graduated from the Wharton School of Business, none of them has entered the family business. However, he requires that his children master three skills: Hire good talent; understand financial reports; understand the law and basic principles of business operations. When one of his sons was very young, he arranged for him to do an internship at a remote village, where there wasn’t even any Internet.
A tall man often seen in suits with a pen in the jacket pocket, Mr Tanoto can be seen as a second John D Rockefeller. In 2006, his family fortune neared US$2.8billion, and he was placed first by Forbes on its list of Indonesia’s 40 Richest. The 58-year-old Mr Tanoto’s fortune did not come from buyovers or shares from listed companies. Instead it came from his pulp & paper, palm oil and energy businesses, which continued to remain stable and grow after the collapse of the Indonesian economy and the Asian financial crisis.
In China, under the umbrella of RGM International, Asia Pacific Resources International Holdings Limited (APRIL) has invested in China. Its core project is APRIL SSYMB located in Rizhao, Shandong, which is currently undergoing its Phase 2 expansion with an investment of up to US$1.4billion. Mr Tanoto hopes that this will be the world’s most environmental-friendly pulp & paper line. One may not be able to connect him with being an “initiator of sustainable development”, but he is far from making empty promises. He has collaborated with the government and non-governmental organizations (NGOs) to introduce the “High Conservation Value Forests (HCVF) concept”, allocating at least 20% of his concessions for conservation of Indonesia’s natural forests, enforcing an anti-illegal logging policy and harvesting only acacia trees planted on 330,000 ha of concession land, which matures at seven years. In China, Mr Tanoto has made donations towards the building of 23 primary schools and 19 other projects in the Qiaoxin Project. “When your operations reach a certain scale, you have to give back to the community in order to continue to grow,” Mr Tanoto said. Before Mr Tanoto was born, his father migrated from his hometown in Putian, Fujian to Medan in Indonesia. He is the eldest in the family, with eight younger brothers and sisters. When Mr Tanoto was 17 years old, his father passed away, leaving him to take on the responsibility of taking care of the family. Hence he became a spare parts supplier. He has laid down many principles in RGM International with annual updates to the employees. Some of the principles are: A company that looks like it is making profits on paper may close down, but a company that has cash flowing in every day will not; avoid drastic changes in times of crisis. A good example: His business groups’ property ratio of debt to net worth is far lower than that of the industry average, and as a test for his managers, he insists on using cashflow as a barometer when preparing financial reports. Every month, he would inspect the cash profits of each of his business groups.
Mr Tanoto’s innate talent for numbers and his ability to size up situations correctly has enabled him to make quick decisions and accumulate his fortune. He started out supplying spare parts to oil and gas companies before undertaking contracts for building of gas pipelines. During the global oil crisis in 1972, he made his first million. However, he realized that no matter how hard one tries, a business that relies on a single industry can be defeated by changing circumstances. Diversification is needed in order to spread out the risks. Thereafter, he invested in the plywood business and from a supplier, grew to become a producer, after which he invested his profits in the palm oil business. Five to six years after that, the worth of his combined assets was US$1billion. During the 1997 Asian financial crisis, Mr Tanoto became the most successful businessman in Indonesia. In the process, he has been educating his team through his investment policies, “During times of crisis, prioritize and solve problems accordingly, and help everyone build confidence.” During that period of time, his pulp & paper mills in Riau province were in the midst of expansion and he had just obtained a loan of US$1billion from three banks. When the financial crisis hit, however, the funds were frozen. Although Mr Tanoto was largely in the export business at that time, with profits and debts measured in US dollars, the mills still ran into risk of closure. Eventually, he decided to divest of his shares in some overseas holdings and transfer the funds back into Indonesia, and restructured the expansion into four phases. The mills commenced production two-and-a-half years later, one-and-a-half years later than originally planned.
However, Mr Tanoto has known failure too. In his beginnings as a plywood producer, the mill he invested in almost ran out of funds, as money for management and buying raw materials had not been factored in. He said, “Run a mill as how you would run a business”. When he switched from being a supplier to a producer, he had a big learning curve. Six months after the mill opened, it was unable to meet the expected production capacity of 8,000 panels a day. Later on, he hired a Taiwanese management team. With the same employees and same machinery, the mill was producing up to 12,000 panels a day in six months. He was only 24 years old then. From this incident, he realized the importance of good management and good talent. “Examples of failures are the most memorable, and you also learn the most from them,” he said.
Till today, Mr Tanoto always carries notepaper around in his suit pocket, so that he can note down figures and other information. He reaches office at 9am most mornings, leaves at 10pm, and works six days a week. He taught himself English and even has even taken time out in the last few years to attend business courses. As the founder of RGM International, before making any major investment decisions, he still listens to opinions from various sources, making his people list the reasons for investing or not investing. He said, “As both shareholder and chairman, it is even more important to listen to others’ opinions.”
Monday, 3 March 2014
Sukanto Tanoto awarded Overseas Chinese outstanding contributor
- People.com.cn, August 2009
陈江和获得“华商卓越贡献奖” 近日，“亚太华商领袖论坛暨亚太最具责任感华商领袖颁奖盛典”在广州举行，新加坡金鹰国际集团主席陈江和先生以其在慈善公益领域的突出贡献,被授予“2009亚太最具社会责任感华商领袖卓越贡献大奖”。
陈江和先生是著名的华人实业家，祖籍福建莆田，他积极参与各项公益事业。截至目前，在中国教育、扶贫、减灾等领域的各项捐资累计超过两亿元人民币。
新加坡金鹰国际集团是一家以资源为基础的多元化跨国工业集团，总资产达100亿美元，员工5万多人。自上世纪90年代初，该集团成功地把东南亚的资源优势和中国广阔的市场相结合，在中国江苏、山东、福建、江西、广东等地投资实业，业务涉及林浆纸一体化、棕榈油加工、特种纤维素与纤维素纤维生产以及液化天然气接收站及电厂。
Sukanto Tanoto Was Awarded “Overseas Chinese Outstanding Contributor” “The Asia-Pacific Chinese Entrepreneurial Leaders (Guangzhou) Forum I.e. the Awarding Ceremony of Asia-Pacific Chinese Entrepreneurial Leaders with the Strongest Social Responsibility” was held in Guangzhou. Mr. Sukanto Tanoto, Chairman of RGM International was honored “Asia-Pacific Chinese Entrepreneurial Leaders with the Strongest Social Responsibility – Outstanding Contributor” for his great contribution to philanthropy and commonweal field.
Mr. Sukanto Tanoto is the famous overseas entrepreneur originated from PuTian, Fujian province. He has been actively involved, and up to now he has donated more than RMB 200 million in China in education, poverty alleviation and disaster relief field.
RGM International is a global resources-based group with total asset value of over USD 10 billion and over 50,000 people. RGM International started to invest in China at the beginning of 1990s by successfully integrated south East-Asia resource with Chinese wide market, RGM International invested in JiangSu, ShanDong, FuJian, JiangXi and GuangDong province. The businesses encompass four key operational areas: integrated pulp and paper, palm oil industry, specialty cellulose and cellulosic fibre, and LNG receiving terminal and power plant.
A Philanthropist
Publication: Indo Post
Date: 5 October 2007
VIEWING THE SYMPATHETIC CARE OF RIAUPULP AND SUKANTO TANOTO FAMILY FOR 2,800 ORPHANS
The Amount of Aid is Increasing Each Year
There were 2,800 poor orphans, elderly, and children of orphanages spread across 11 regencies and towns within Riau Province that had accepted the Ramadan packages from the family of Sukanto Tanoto and the management of PT Riau Andalan Pulp and Paper (Riaupulp), in Pangkalan Kerinci, Riau, on Wednesday 3rd October 2007.
The transfer of this Ramadan packages aid has become an annual program of the Sukanto Tanoto family since 2003. The Ramadan packages consist of tinned biscuits, sugar, milk powder, prayer rugs and towels. The amount of the Ramadan packages given by the Sukanto Tanoto family has been increasing every year.
“The aid is a form of our concern to the society at large. There were 1,000 packages in 2003, 1,000 packages in 2004, 1,300 packages in 2005, 1,400 packages in 2006, and this year, 2007, the number increased to 2,800 packages,” said Andre Tanoto, representing his father, Sukanto Tanoto.
Besides the aid to alleviate the burden of the poor when celebrating Idul Fitri 1428 Hijriah from 1 to 10 October 2007, Riau would also be holding a Ramadan Bazaar in 13 villages in six regencies and towns in Riau. 5,200 packages will be distributed. “In holding these bazaars, we include university student organizations from six regencies,” explained Rudi Fajar.
The aid transfer and bazaars were some of Riaupulp’s manifestation in conducting a balanced business by combining 3 Ps (People, Planet, and Profit). It means paying attention to the aspects of social, environmental, and the firm’s economics. “We are conducting a fully responsible business. We must keep everything in balance, contribute to the progress of humanity, and also participate in assuring the continuing future for everyone,” added Rudi.
This is in accordance with the vision of APRIL Group’s founder, Sukanto Tanoto, who emphasized the importance of companies operating their business with in an environmental and socially responsible way. APRIL, which is the holding company of Riaupulp, has also been a signatory of the UN Global Compact since April 2006.
As informed, in September 2007, in recognition of its contributions towards poverty elimination in Riau, Riaupulp was gifted the Excellence Award by CSR Asia in the category of poverty elimination. “This Asia-level award is the evidence of Riaupulp’s commitment to progress and develop together with the society,” said Troy Pantouw, public relations manager of Riaupulp.
In its attempts to eliminate the poverty in Riau, Riaupulp has been developing the integrated farming program. At the moment, there are 4,098 trained farmers that are distributed in five regencies in Riau. Riaupulp has also successfully invited banking parties to flow 1.1 billion rupiah for Riaupulp’s training peers.
Prior, in 2005, Riaupulp was Runner-Up in the Asian Corporate Social Responsibility (CSR) Award in the Environmental Excellence category. Besides that, in 2007, Riaupulp was awarded the Social Empowerment Award by the Coordinating Minister For Public Welfare, and in 2006 it was given an award in CSR by the Social Department for Social Investment and the Coordinating Minister For Public Welfare. In 2005, Riaupulp was awarded with the first grade of CSR Indonesia Award in the social category.
Who is Sukanto Tanoto?
Sukanto Tanoto
Founder and Chairman
RGE
Today, RGE is a global group with assets exceeding US$$12 billion, a workforce of 50,000 people and manufacturing operations in China , Indonesia and Brazil
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