Anderson Tanoto is a scion of the RGE group, which includes one of the world’s largest paper and pulp producers. He talks about how he fights critics of its sustainability record.
During the long months of Covid-19 last year, Anderson Tanoto would go for walks with his parents at Gardens by the Bay. There, they stumbled on the Dale Chihuly: Glass In Bloom exhibition, and were enthralled by the glass sculptures of the American artist.
“The exhibition was beautiful and added some colour, some joy into what was a very challenging time for Singapore and the whole world,” Mr Tanoto recalls.
When the Tanotos learnt that the exhibition was temporary and that the artworks would be shipped back, they felt something had to be done.
“I said, ‘okay, let’s do our part. Maybe we can donate one piece that can stay as a permanent installation in Singapore.'”
The Tanoto Foundation decided to buy one of the sculptures and gift it to the Gardens. The cost: $1.2 million, along with $100,000 for its maintenance.
Ethereal White Persians, which features 97 glass pieces, now sits at the top level of the Cloud Forest.
The garden setting of the gift is perhaps fitting, given that the family runs the RGE (Royal Golden Eagle) conglomerate, which owns vast tracts of forests.
Mr Tanoto is a managing director at RGE, which was started by his father, Mr Sukanto Tanoto. The older Mr Tanoto, 72, is chairman of RGE and was listed by Forbes as Indonesia’s 21st richest man last year.
RGE, which is headquartered in Singapore, deals in fibre, palm oil and gas. It has assets of US$25 billion (S$34 billion) and a workforce of 60,000 in Singapore, Indonesia, China, Brazil and Canada. Among many other things, it produces Paper One copier paper, viscose fibre used in textile, and palm oil.
Mr Tanoto, the youngest of four children, has chosen to have lunch at the Si Chuan Dou Hua Restaurant on the 60th floor of UOB Plaza.
It is a favourite haunt of the Tanotos as their office is on the 50th floor. In fact, when we are filming the video later, laughter from the room next to ours means we have to pause the recording at several points. Turns out his father is having lunch with bankers there.
At just 33, Mr Tanoto exudes a confidence beyond his years. The Indonesian is sharply dressed, personable and articulate.
He knows the menu well and I leave him to order. “Good comfort food,” he says of the dishes.
He wears the family wealth lightly. The gift to Gardens by the Bay is something I raise, not him. I had visited the Gardens some weeks earlier and, because I was scheduled to interview him, had noticed the family’s name on a plaque next to the sculpture.
I wonder if he and his parents – he lives with them in Stevens Road – had also bought a Chihuly sculpture for their own home.
“No, no, we didn’t,” he laughs. “Chihuly pieces just look much better in commercial spaces with the lights and the scale.”
The sculpture was the foundation’s first donation of an art piece. Last year, it committed about US$25 million in Indonesia, China and Singapore, to areas like education, medical research, environment and leadership.
In Singapore this year, its donations include $2.6 million to fight diabetes and $2 million to the Rare Disease Fund. The foundation has committed about US$100 million to various causes since 2015.
Moving to Singapore
The foundation is another face of a group that has received its share of brickbats, not least from conservationists.
RGE’s fortunes are built largely on turning trees into pulp and paper products, and palm oil into anything from cooking oil to shampoo.
Combined, RGE’s companies have more than 1 million ha of forests in Indonesia and Brazil. That’s the size of about 14 Singapores.
One of its companies, Asia Pacific Resources International Limited (April), is one of the world’s largest producers of pulp and paper with 480,000ha of forests. April separately conserves, restores and protects more than 360,000ha of forests.
Another company, Asian Agri, has 30 oil palm plantations totalling 100,000ha.
Over the years, RGE has had to face accusations running the gamut of deforestation, pollution and land disputes.
Mr Tanoto – fresh-faced, earnest, enlightened and Wharton-trained – is RGE’s answer to these naysayers.
He has focused on sustainability, conservation and business transformation since he joined the group in 2013 at the age of 24.
But, first, his back story.
He was born in Indonesia and was known as Edison as a baby before this was changed to Anderson. “My mother said Thomas Edison, the inventor, had a very tough life,” he laughs. “I don’t know. I was very young then.”
He moved to Singapore when he was nine and was enrolled in Anglo-Chinese Primary School, then later at ACS (Independent). His brother and sisters were already studying in Singapore, at ACS and Raffles Girls’ School.
The move to Singapore was driven by how his parents wanted the children to have strong Chinese values, he says.
Mr Tanoto’s paternal grandfather immigrated to Indonesia from Putian city in Fujian province. His maternal grandfather came from Chaozhou.
His father had also wanted to base his company in Singapore. “Singapore is still one of the best places to put your global headquarters,” says Mr Tanoto. “We’re one of the examples.”
His father’s success story is fascinating.
Born in Medan in 1949, Mr Sukanto Tanoto stopped school at 17 and joined his father who was running a small company supplying spare parts to oil and gas companies.
He built up the business and moved to building gas pipelines for multinationals. In 1973, he set up a plywood company later renamed Royal Golden Eagle Group. The businesses flourished and he expanded successfully into palm oil. More plantations followed as he moved to producing paper pulp.
“It’s incredible what he had been able to achieve in that one generation, so it’s a lot to live up to,” Mr Tanoto says of his father.
Fitting into a Singapore school wasn’t difficult, he recalls. He played a lot of sports – badminton then rugby, where he was vice-captain of the school team.
Sports taught him how to lead in a high-pressure environment.
“People who are communicating, leading, at the beginning of the game when everyone is fresh, that’s easy,” he expounds. “But who’s the one actually pulling the team together at the 75th minute of the 80-minute game when you’re just absolutely physically and mentally exhausted? That’s when the true leader shines.”
He went on to Wharton School at the University of Pennsylvania and did finance and management.
He spent two short but valuable years at Bain consultancy where he learnt two things. One was to be data-driven, and the other was to crystallise his message.
“If you don’t crystallise it to a few key actionable points, companies or people get confused, right?”
He has taken this to heart and seems to like breaking things down.
When I remark on the size and complexity of RGE’s businesses, he assures me: “It is not complicated.”
The company has three pillars: “Anything to do with eucalyptus and acacia trees is called fibre business; anything to do with palm and agriculture is called our agri and palm business; and then clean energy and gas.”
There is clarity and focus, he says. “That’s why we can be successful. If we’re not focused, if we’re not clear, it’s very difficult, right?”
While he would have benefited from a few more years at Bain, he wanted to work with his father.
“Time is something that you cannot turn back,” he muses. “I really wanted to be there when he was very active still. Those are very precious years that you cannot replay.”
He joined RGE at a time when climate change, environmental issues and corporate sustainability were gaining urgency.
RGE was “admittedly under pressure from the external environment”, he puts it delicately.
“We had to make very strong sustainability commitments to show our seriousness.”
In 2013, RGE launched the Riau Ecosystem Restoration (RER) programme. This commits to restore and conserve 150,000ha of fragile peat swamp forests in Sumatra that is home to threatened flora and fauna.
In 2015, the group set out a sustainability framework. Among other things, it committed to eliminate deforestation from its supply chains and support forest management best practices in countries where it sources timber.
He is proud of what the company has achieved. “Now, people are just getting on to sustainability and we already have good, concrete programmes and data,” he says.
Fighting naysayers
One of the biggest challenges the company faces is perception.
“The fact that we’re an Asian company with Indonesian origins, by de facto, you’re already negative five, in the perception of sustainability,” he says.
His mission is to continue to champion the region and keep pushing the boundaries of sustainability – “to show the world that Asian companies like us, a privately owned family organisation, can still take a lot of policies on sustainability that are as good, if not better, than the MNCs”.
Being a Tanoto – and his youth – have helped him lead the group’s sustainability efforts.
He has direct access to the leadership, and being “young enough” and “gullible enough” has allowed him to spend time on the ground to understand the issues.
I wonder if his father needed convincing about sustainability.
He answers this by relating how his father has always said that “it’s not the strongest who survives, it’s not the smartest, or the fastest runner that survives”.
Rather, “it is the one that adapts to the changing environment”.
And the environment has changed. In the 1960s and 1970s, sustainability was not on his father’s mind, he says. In the 1980s and 1990s, awareness was still very low. But from the latter half of the 2000s, there was a realisation that certain things had to be done differently.
The clearest motivator has been the environment itself, and the need to save it.
“And so we adopt and we adapt,” he says.
His two sisters are also managing directors in RGE’s executive management board chaired by their father.
Imelda, 40, sits on the investment advisory committee which oversees the family office, and Belinda, 36, oversees RGE’s operations in China.
There are non-family members on the board, including the vice-chairman, president and directors.
Older brother, Andre, 41, is not in the business. “He likes being a bit more entrepreneurial, a bit more independent.” But Andre, like the other siblings, is in the family foundation which their father and mother, Tinah Bingei Tanoto, 69, set up.
Do the siblings get along, I ask. “Yeah, of course,” he says. “We get along very well… Even when we have something called family meetings and talk about topics that are agenda-ed in.”
He gives me a peek into the world of super-rich family businesses where such meetings are a way of “formalising the informal”.
“In any family, sometimes a lot of the issues come up because of misunderstanding, right? And misunderstanding typically comes from assumptions. All these assumptions can be clarified if you create opportunities and avenues to discuss them in a more formal manner.”
The meetings take place twice a year, at a hotel or overseas, and outside advisers are brought in to drive the process.
What sort of issues are discussed, exactly, I ask.
“Prenuptials,” he gives an example. “These are very sensitive topics, right? I always say it’s better to discuss objectively than subjectively.
“When it’s really happening and you discuss it, wah, it’s difficult, right, because it’s talking about an individual. But if you discuss prior to it happening, then it becomes, ‘oh, we’re discussing because there are considerations.'”
What we ate
Si Chuan Dou Hua Restaurant
UOB Plaza, 80 Raffles Place #60-01
1 minced meat dumpling in sour and spicy stock (4 pieces): $6
1 steamed minced meat dumpling with chives (4 pieces): $6
2 double-boiled chicken soup with fish maw, sea whelk and morel mushrooms: $36
1 deep-fried prawns in wasabi: $28
1 homemade bean curd with spinach and dried scallops: $24
2 Sichuan dan dan noodles: $16
1 stir-fried sliced beef with sliced garlic: $28
2 homemade fine bean curd with wolfberries: $8
1 tea: $6
Total (with GST and tax): $191.85
Are you RGE’s designated successor?
“I don’t look at it that way. This business is bigger than one individual, especially in the second generation,” he replies.
The family had decided the company would have very strong executives so it can compete globally and scale up, he explains.
“In the end, you have to have strong people – executives, management. So it’s not about a family member being involved.”
As we wrap up lunch, I ask Mr Tanoto, who is single, if he ever feels the burden of carrying the family name.
“It’s a responsibility that you step up to,” he reflects. “When the days are good, you feel motivated. When times are tough, it becomes a burden.
“But I’m always very thankful that I’m given an opportunity and a platform at 33 to make a difference… to influence decisions and outcomes that are scalable and impactful at a global level.”
Correction note: An earlier version of the story said the Tanoto Foundation has committed about US$25 million to various causes since 2015. A spokesman has clarified that the amount should be about US$100 million.
Source : The Straits Times