speaker

Sustainability

Resource Efficiency and Climate Change

We recognize climate change is a significant risk that requires adaptation, mitigation, initiatives and recognize the transition risks associated with it.

Climate change is causing higher temperatures and more extreme weather events, such as greater frequency and intensity of rainfall and droughts, which are affecting our agribusiness operations. These constitute a significant physical risk to our business, potentially lowering our crop yields, making our agricultural management more complicated and costly, and causing disruptions to the global supply of agribusiness commodities.

Corporations are increasingly expected by governments, investors, and customers to adhere to carbon regulations, provide disclosure on climate-related issues, and offer low carbon products. We recognize that these pressures create transitional risks and opportunities related to the shifting of our strategies, policies, business model, or investments to reduce our carbon footprint and impact on the climate.

Annually, we assess each risk and opportunity, integrating these insights into our business strategy to meet our ESG goals. The Board of Directors, led by our Chief Operating Officer, oversees the mitigation of transitional risks, acknowledging the financial stakes climate change poses. 

Our strategic endeavors in agribusiness innovation and research are pivotal in addressing climate change impacts and enhancing operational efficiency. Here is a detailed look at these initiatives:

Composting

Leveraging microbes to transform empty fruit bunches into organic fertilizers, our composting initiative necessitates an investment of USD 3.5 million for each operational site. This significant investment pays dividends by reducing the reliance on chemical fertilizers, enhancing soil moisture, and revitalizing soil structure. Notably, in regions like Belitung, this initiative has led to a notable increase in yield for young mature palms and a reduction in chemical fertilizer usage by over 50%, effectively lowering greenhouse gas (GHG) emissions from fertilizer application.

Drip Fertigation

Implementing a small-scale pipeline network allows precise distribution of water and fertilizers directly to each palm tree. With an investment of USD 1,850 per hectare, this method substantially diminishes operational expenses by over 55% and ensures sustained crop growth, proving especially beneficial during extended drought periods.

Assisted Pollination

By bolstering the population of pollinators and providing mechanical assistance in pollination processes, especially in areas with diminished natural pollinator populations, we have successfully increased the weight of fruit bunches and enhanced fruit set development. This initiative underscores our commitment to maintaining ecosystem balance and improving production efficiency.

Wildfire Prevention

To safeguard our concessions from external wildfires, we have implemented fire prevention measures, including the construction of closed canal systems and water reservoirs that act as protective barriers. Additionally, enhancing our rapid response capabilities ensures we are well-prepared to address potential wildfires swiftly, minimizing their impact on our operations and the surrounding environment.