Eleven social and environmental civil society groups and networks sent a joint letter to Asia Pulp & Paper (APP) on 24 April 2013, explaining the substantial social and conservation issues APP has failed to address adequately in its Forest Conservation Policy and associated documents. On 5 February 2013, the Sinar Mas Group’s Asia Pulp & Paper (APP) published a new “Forest Conservation Policy” (FCP). Since then, SMG/APP organized several “focus group discussion” meetings with various Indonesian NGOs to socialize their policy and the “Standard Operational Procedures (SOP)” or Protocols it developed to implement it. Summarizing their responses to these meetings, the NGOs stated “considering how important and fundamental these issues are, we would like to ask APP to pay serious attention to these notes prior to enacting those protocols”.

TheAsiaPulp&PapercompanyoftheSinarMasGroup(SMG/APP)portraitsitselfasa saviour of the critically endangered Sumatran tiger. Investigations by the NGO coalition Eyes on the Forest (EoF) show that the forest clearing operations of APP and its suppliers appear to be one of the major threats to the survival of the tiger in Riau, Sumatra.

APP continues repeating the same false statements together with some new twists, all trying to hide the ultimate foundation of the Sinar Mas Group/APP’s operations: the continuing destruction of natural tropical forest and drainage of peat soils. APP’s PR effort today is bigger and with more aggressive use of the media than ever before. APP has recruited a wide variety of publicists, individuals and supposedly independent NGOs to flack its allegedly green practices, including, Cohn & Wolfe, Environmental Resource Management, Alan Oxley and his World Growth and ITS Global, Mazars, Carbon Conservation, Patrick Moore and his Greenspirit Strategies, Bastoni and his Sumatran Tiger Conservation Foundation (YPHS). It runs its commercials globally on CNN, Sky TV and other international broadcasting channels.

In this report, Eyes on the Forest investigates APP’s PR claims. Has there been any improvement of SMG/APP’s practices on the ground? Has there been a reduction of the company’s impact on the world’s most diverse natural tropical forests, wildlife, and the world’s climate?

The answer is a straightforward: No. SMG/APP continues draining deep peat soils and clearing natural forests and its negative impact is increasing with the scale of its operations.

PT Bina Duta Laksana (PT BDL) is an industrial logging and pulp wood plantation company that supplies tropical timber and plantation fiber to Asia Pulp and Paper (APP), Indonesia’s largest pulp and paper company that has recently moved its headquarters to China. With PT BDL, APP is now grabbing land, decimating the farms, wetlands and forest lands once considered useless or unprofitable for the logging sector. The new frontiers and increased impacts of industrial pulp wood plantations are taking a serious toll on Riau’s forests, leaving only 37 percent of the forest that existed in Riau in 1985.

Sinar Mas hired a group of auditors to evaluate the evidence, published by Greenpeace International, of its oil palm division’s role in the clearance of carbon-rich peatlands and critical wildlife habitat in Indonesia. Sinar Mas claimed that the audit showed it ‘operates responsibly and within the laws’ and that Greenpeace claims were ‘exaggerated or wrong’, a move which backfired when the auditors themselves criticised the company for misrepresenting its findings.

However, rather than address the impact of its current operations on the climate, Sinar Mas has since hired the Australia-based consultancy ITS Global (International Trade Strategies Global) to ‘assess the validity and accuracy of the claims’ made by Greenpeace ‘based on the evidence cited in the report’. ITS Global is headed by Alan Oxley – a well-known industry apologist.
ITS Global appears to have been paid by Sinar Mas to cast doubt on the reliability of Greenpeace evidence – without any attempt to ground-truth the validity of the findings or to provide credible evidence to back up its claims. The validity of the data used by Greenpeace is demonstrated below.

Photographic evidence, aerial monitoring and field analysis details how the Sinar Mas group continues to clear rainforest containing priceless biodiversity – such as orangutan habitat - and carbon-rich peatlands, despite public promises it has made to clean up its act.

Sinar Mas group is notorious for its destruction of millions of acres of Indonesian rainforest, peatland and wildlife habitat. Two divisions within the group lead the destruction: pulp and palm oil. Recently, the group has diversified into coal.

40 European NGOs sent a letter to paper companies demanding to stop any eventual purchase of paper from the Indonesian-Chinese paper giant Asia Pulp and Paper (APP). APP and its fibre suppliers are estimated to be the single largest source of rainforest destruction in Sumatra and are pushing three highly endangered species - the Sumatran tiger, elephant and orang-utan - closer to extinction.

Doing business with APP at this time supports the further expansion of its operations into Indonesia’s last tropical forests and peatlands. The company is, in our view, the least responsible pulp and paper producer globally. Since it began operations in the 1980s, APP is estimated to have pulped more than 1 million hectares of natural forests in Sumatra. The company now has forestry operations in Kalimantan to fill wood supply gaps and is trying to enter Papua, Indonesia’s last forest frontier.

An Eyes on the Forest (EoF) investigation conducted in November - December 2009 confirmed that two Industrial Timber Plantation companies associated with Asia Pulp & Paper (APP) of Sinar Mas Group (SMG), namely PT Bina Duta Laksana (PT BDL) and PT Mutiara Sabuk Khatulistiwa (PT MSK), continue to clear natural forest and dig drainage canals through the deep peat inside Kerumutan forest block under legally questionable circumstances. The forest clearance and peat draining by the two companies started in 2005.

EU Ecolabel is awarded to two brands of photocopy paper, produced by the Indonesian company Pindo Deli, that do not deserve it. Further- more, while documenting this case it became clear that there is insufficient information publicly available to allow consumers to check on which basis the EU Ecolabel has been awarded to companies. PT WKS’s operation in Jambi province in Sumatra have serious impacts on forests, indigenous peoples and local communities. Research by Indonesian NGOs indicates that PT WKS’s operations in the Bukit Tigapuluh forest ecosystem may not even be legal.

35 Indonesian NGOs sent a letter to companies to ask them to reduce your company’s consumption and environmental footprint by establishing social and environmental safeguards on procurement and by helping to bring about crucial changes to the Indonesian pulp and paper industry’s practices as well as supporting related government policy reforms. The Indonesian NGOs request that investors adopt similar safeguards in relation to investments in Indonesia’s pulp and paper sector.

Indonesian NGOs take public stance on paper giant’s misleading marketing push and call for severing ties with company

Long a controversial company, APP has recently stepped up its public relations efforts with a series of infomercials touting its environmental and social accomplishments and misleading certification claims. These moves may be an effort to pave the way for the company’s anticipated issuing of bonds and a possible initial public offering (IPO) of its Chinese division, and comes at the same time as new investments in direct sales capacity in Europe and North American paper markets.

Indonesia has one of the world’s largest areas of remaining forest but also one of the world’s highest deforestation rates. Reported exports from its lucrative timber sector were worth $US6.6 billion in 2007, second only to Brazil and worth some $2 billion more than all African and Central American nations combined. But in recent years almost half of all Indonesian timber has been logged illegally at a staggering cost to the Indonesian economy and public welfare.

In this report Human Rights Watch details these costs and their human rights impacts. Using industry-standard methodology, we estimate that the Indonesian government lost an average of nearly $2 billion annually between 2003 and 2006 due to illegal logging, corruption, and mismanagement. The total includes: forest taxes and royalties never collected on illegally harvested timber; shortfalls due to massive unacknowledged subsidies to the forestry industry (including basing taxes on artificially low market price and exchange rates); and losses from tax evasion by exporters practicing a scam known as “transfer pricing.”

The recent certification of an Asia Pulp & Paper (APP)/Sinar Mas pulp plantation by the Indonesian Ecolabelling Institute (LEI) suggests that the LEI standards need to be strengthened, as APP products are not sustainable, a group of non- governmental organizations in Indonesia warned global paper buyers today.

The NGOs call on LEI to follow FSC to make a similar policy and review its relationship with APP/SMG and their associated companies.

The environmental organizations in Sumatra call APP/SMG to solve its real issue: large-scale destruction of natural forest, emissions from natural forest and peat destruction and social problems.

Many luxury brands and fashion leaders in the U.S. and Europe are unknowingly contributing to this tragic pattern of destruction. Research shows that almost 100 fashion and luxury products companies buy their custom packaging products from Pak 2000, an affiliate of Sinar Mas Group’s Asia Pulp & Paper (APP). The Sinar Mas group is perhaps Indonesia’s biggest forest destroyer, with APP alone responsible for clearing more natural forest in Sumatra than any other company. Aggressive logging practices and continued conversion of standing forests to plantations is devastating local communities and threatening elephant, tiger, and orangutan populations.

This report discusses the social, economic and environmental impacts of APP’s operations. Chapter one gives an overview of Indonesia’s forestry industry development paradigm, which led to the industrial tree plantation policy (or Hutan Tanaman Industri [HTI]) to satisfy the pulp and paper industry’s demand for raw materials. Chapter two gives an overview of APP and its operations in Sumatra. Chapter three discusses the environmental impacts of APP’s operations in the provinces of Riau and Jambi in Sumatra. Chapter four describes the social and economic impacts of APP’s operations, as well as the impacts on local communities. Chapter five discusses the rights of workers employed by APP. The report ends with a summary of the impacts caused by APP’s operations.

This report discusses the social, economic and environmental impacts of APP’s operations. Chapter one gives an overview of Indonesia’s forestry industry development paradigm, which led to the industrial tree plantation policy (or Hutan Tanaman Industri [HTI]) to satisfy the pulp and paper industry’s demand for raw materials. Chapter two gives an overview of APP and its operations in Sumatra. Chapter three discusses the environmental impacts of APP’s operations in the provinces of Riau and Jambi in Sumatra. Chapter four describes the social and economic impacts of APP’s operations, as well as the impacts on local communities. Chapter five discusses the rights of workers employed by APP. The report ends with a summary of the impacts caused by APP’s operations.

The forest destruction, social conflict and financial crisis of Asia Pacific Resources International Holdings Ltd (APRIL), and the role of financial institutions and paper merchants.

This report reveals the damaging environmental and social impacts of Asia Pacific Resources International Holding Ltd, otherwise known as APRIL, one of the biggest pulp and paper companies in the world. It also examines the influential role played by financial institutions and paper merchants in fuelling this damage. It provides recommendations for urgent action to be taken by all these groups in order to help bring an end to the destruction of Indonesia’s forests, one of the most precious and threatened natural habitats on Earth.

The following reports have been produced by this project. The first of these represents a synthesis of the major findings from the nine case studies, accompanied by a historical analysis of forest administration and forestry sector development in Indonesia, and a discussion of the origins and legal-regulatory basis of the nation’s ongoing decentralisation process. Each of the nine case studies is published as a separate report (with the exception of the study districts in Riau, which have been combined) in order to make the information contained therein more readily accessible to decision-makers involved in the decentralisation process.

Asia Pulp & Paper (APP) is one of the biggest pulp and paper companies in the world and is responsible for destroying a large area of Indonesia’s rainforest. This briefing examines the destructive practices of APP and the Indonesian pulp and paper industry. It also reveals how international financial institutions are responsible for funding the activities of APP.