Sinar Mas Group

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Sinar Mas Group
Type Private
Founder(s) Eka Tjipta Widjaja and Singgih Wahab Kwik (Kowik)
Headquarters Indonesia
Owner(s) Eka Tjipta Widjaja
Website www.sinarmas.com/en/

Sinar Mas Group is one of the largest conglomerates in Indonesia. It was formed in 1962. It has many subsidiaries including Asia Pulp & Paper and palm oil producer PT SMART.

Sinar Mas Group was founded by a Chinese Indonesian tycoon, Eka Tjipta Widjaja with the help of Singgih Wahab Kwik (Kowik) or Christophorus Kowik Singhap (Former head of commissary and deputy). Its main businesses are: Pulp and Paper, Agribusiness, Property and Financial Services. Eka Tjipta Widjaja came to Indonesia at the age of 9 years with his parents during a difficult situation in their country of origin—China. It had set up a subsidiary in India in the 1990s, but sold it to Ballarpur Industries Limited in 2001.

Sinarmas businesses operate in different sectors such as Pulp and Paper, Real Estate, Financial Services, Agribusiness, Telecommunications and Mining. The businesses are listed in the Indonesian and Singapore stock exchanges.

Recently the company, which according to Greenpeace[1] is responsible for clearing rainforests and destroying peatlands, has created Eka Tjipta Foundation, a philanthropic foundation that focuses on Education, Poverty and Renewable Energy.

Jaya Suprana from the Indonesian Museum of Records (MURI) presented a certificate to the Eka Tjipta Foundation, a non-profit organization under one of the country’s largest conglomerates, Sinar Mas Group, for granting “the largest number of scholarships for undergraduate students during certain period".[2]

Criticism and controversies[edit]

Environmental concerns[edit]

A palm-oil producing subsidiary of Sinarmas Group Smart Tbk has been accused by Greenpeace of causing deforestation of Indonesian rainforests.[3] To investigate this accusation, Smart Tbk has appointed Control Union Certification and BSI Group,[4] assisted by two researchers from the Bogor Agricultural Institute.[5] Greenpeace states that they have never accused them of destroying primary rainforest - i.e. forest areas which show no signs of ever being disturbed by humans (August 2010).[citation needed]

Haze in Singapore and Malaysia[edit]

Main article: Southeast Asian haze

According to Indonesian government officials, Sinar Mas is one of the eight companies responsible for sending hazardous level of smog to Singapore and Malaysia. [6]

Unilever[edit]

In December 2009, Unilever suspended purchases of palm oil from PT Smart, a Sinar Mas subsidiary, citing concerns that PT Smart had not provided sufficient evidence that they are not involved in unacceptable environmental practices.[7] However, Unilever plan to resume Palm Oil purchases if independent auditors, formed by Sinar Mas and Unilever, disprove allegations of forest destruction.[8]

Nestle[edit]

In March 2010, Nestle faced a public reputation crisis over its procurement of palm oil from Sinar Mas whose plantations are reported to be the cause of widespread rainforest and orangutan habitat destruction.[9] To avert the public reputation disaster, Nestle quickly moved to stop its palm oil procurement from Sinar Mas. After Sinar Mas appointed independent auditors to investigate the issue, Nestle joined the committee and may resume palm oil procurement from Sinar Mas if they are cleared of the allegations.[10] In August 2010 the Nestle chairman Peter Brabeck-Letmathe stated that the focus on his company is misguided. "You know very well that it's not Nestle's 350,000 tons of palm oil that brought about deforestation in Indonesia," he said, "but a political decision to use food as a source for biofuels." The United Kingdom and Germany alone have consumed 500,000 tons of palm oil for biofuels between them, he said.

Abengoa[edit]

In May 2010, Abengoa Bioenergy asked its raw material suppliers to boycott palm oil from any company in the Indonesian group of Sinar Mas, until it can demonstrate that it fully complies with Abengoa’s environmental and social sustainability policy. [11]

HSBC[edit]

In May 2010, focus of the Greenpeace campaign moved to HSBC,[12] calling for them to sell their stocks in Sinar Mas. By July 2010, HSBC had written to Greenpeace to inform them that the shares had been sold.[13]

Carrefour[edit]

July 7: Carrefour has dropped Sinar Mas as its supplier.[14] “Carrefour is committed to sustainable development and has decided to cease sourcing of APP supplies for private label products from mid-year this year until further notice.” Carrefour Indonesia external communication manager Hendri Satrio told The Jakarta Post in a letter.[15]

Burger King[edit]

In September 2010, Burger King announced that they would no longer source Palm Oil from Sinar Mas. They published a statement announcing: "After completing a thorough review of the independent verification report conducted by Control Union Certification (CUC) and BSI Group, we believe the report has raised valid concerns about some of the sustainability practices of Sinar Mas' palm oil production and its impact on the rainforest. These practices are inconsistent with our corporate responsibility commitments"[16]

Mattel[edit]

In 7 June 2011, Greenpeace launched "Barbie, It's Over", a global campaign to bring awareness and encourage Mattel to switch pulp and paper producers.[17][18] Mattel uses paper sourced from Asia Pulp & Paper, one of the subsidiaries of Sinar Mas Group in its product packaging, particularly in packaging in the Barbie line of toys.[19]

Convention Center[edit]

Together with Kompas Gramedia Group, Sinar Mas Land will build 150,000 square meter convention center on 25 hectares of land in Bumi Serpong Damai. The Indonesia Expo convention center is expected to start in 2012 and should be completed by the end of 2013. The convention center will be equipped with 3 hotels, 10 halls, a 10,000 people concert hall, a theater and a museum. The center will be able to accommodate at least 200,000 visitors a day.[20]

References[edit]

  1. ^ "Lessons from the palm oil showdown | Guardian Sustainable Business". London: theguardian.com. 2010-10-27. Retrieved 2014-02-26. 
  2. ^ "Eka Tjipta Foundation receives MURI Award". The Jakarta Post. 7/30/2010 3:44 PM. 
  3. ^ "Caught Red-Handed: How Nestlé's Use of Palm Oil is Having a Devastating Impact on Rainforest, The Climate and Orang-utans | Greenpeace International". Greenpeace.org. 2010-03-17. Retrieved 2014-02-26. 
  4. ^ "SMART Appoints Control Union Certification and BSI Group to Verify Greenpeace Reports". Smart-tbk.com. 1 April 2010. Retrieved 2014-02-26. 
  5. ^ "SMART Refutes Allegations Made on Greenpeace Website". Smart-tbk.com. 5 July 2010. Retrieved 2014-02-26. 
  6. ^ "Indonesia blames eight firms for fires affecting region". Straits Times. 21 June 2013. 
  7. ^ "Unilever takes stance against deforestation | Media centre | Unilever Global". Unilever.com. Retrieved 2014-02-26. 
  8. ^ "Unilever to resume buying CPO if Sinar Mas cleared". Reuters. 7 April 2010. 
  9. ^ Tabacek, Kai (18 March 2010). "MIC: Guardian Sustainable Business,Palm oil (environment)". The Guardian (London). 
  10. ^ "Nestlé committed to traceable sustainable palm oil to ensure no-deforestation | Nestlé Global". Nestle.com. 2010-04-13. Retrieved 2014-02-26. 
  11. ^ "Abengoa :: Press Room :: News :: News Archive :: 2010 :: May". Abengoa.es. 2010-05-10. Retrieved 2014-02-26. 
  12. ^ "HSBC forest policy has loopholes you could drive a bulldozer through | Greenpeace UK". Greenpeace.org.uk. 2013-12-28. Retrieved 2014-02-26. 
  13. ^ Maung, Zara (8 July 2010). "MIC: Guardian Sustainable Business,Palm oil (environment)". The Guardian (London). 
  14. ^ "Carrefour drops products from Indonesia's APP". Reuters. 7 July 2010. 
  15. ^ "Sinar Mas reels from PR woes as Carrefour ends deals". The Jakarta Post. 2010-07-07. Retrieved 2014-02-26. 
  16. ^ "Burger King drops palm oil supplier linked to Borneo rainforest destruction". News.mongabay.com. Retrieved 2014-02-26. 
  17. ^ [1][dead link]
  18. ^ Sarah Anne Hughes (12:11 PM ET, 06/08/2011). "Greenpeace protests Barbie at Mattel headquarters". The Washington Post. 
  19. ^ "How Sinar Mas is Pulping the Planet". Greenpeace.org. Retrieved 2014-02-26. 
  20. ^ [2][dead link]

External links[edit]