Indonesia's billionaire family is accused of controlling a group of “shadow companies” linked to major deforestation

Former employees of a series of secret companies accused of clear-cutting swathes of Borneo's rainforest claim the group is controlled by Royal Golden Eagle, one of the world's largest pulp and paper producers. a new investigation unveiled by ICIJ partner The Gecko Project and Bloomberg.

RGE, which sells a range of products to international brands, is owned by the Tanotos, a super-rich Indonesian business family. According to nine former employees of Borneo Hijau Lestari, the alleged “shadow business group,” Anderson Tanoto, the son of the RGE founder, ran the company himself, The Gecko Project reported.

Tanoto has been outspoken about sustainability and conservation at top conferences, touching on topics such as biodiversity and renewable energy at Davos, Cop26 and the G20 Economic Summit, The Gecko Project noted. BHL’s subsidiaries are now reportedly among Indonesia’s largest “deforestationers” of pulp and paper.

According to The Gecko Project, BHL's owners use offshore secrecy areas such as Samoa to hide their identities. But seven of the nine insiders – who worked at BHL and its subsidiaries between 2015 and 2024 and ranged from junior staff to managers – told reporters that the true owners of BHL were the Tanoto family, citing management overlaps and internal documents RGE management pointed out Anderson's visits. Two others told the Gecko Project that they were asked by managers to prepare for multiple visits from Tanoto, who arrived by helicopter between 2018 and 2023.

“This is really strong evidence that RGE and BHL are connected,” Syahrul Fitra, a senior forest activist at Greenpeace who reviewed the findings, told The Gecko Project. “Why else would an RGE boss, a high-ranking person, come to such a concession?”

The new study adds a March report by Greenpeace and other environmental groups who alleged that RGE concealed its ties to an Indonesian pulp company, PT Mayawana Persada, which was accused of widespread destruction of forests and orangutan habitat.

A BHL subsidiary, Industrial Forest Plantation, is considered one of Indonesia's top deforestation offenders, having destroyed an area of ​​forest equivalent to about a third the size of New York City since 2019, according to deforestation monitoring consultancy TheTreeMap.

In a statement to The Gecko Project and Bloomberg, RGE denied the alleged relationship with BHL.

“RGE does not operate what you have described as a shadow supply chain and remains steadfast in its adherence to the sustainability commitments of all RGE Group companies, particularly the no-deforestation pledge,” RGE said in a statement.

The Gecko Project's new reporting follows a series of investigations by ICIJ and its partners that have uncovered how companies often obscure links to deforestation and environmental crimes. ICIJs Deforestation Inc. The investigation, conducted in collaboration with 43 media partners worldwide, uncovered deficiencies in the environmental audit industry and certification programs designed to promote responsible forestry and other social goals.

In November 2023, the Gecko Project found that in the last decade Major producers of palm oil and pulp and paper products have publicly announced sustainability goals At the same time, they set up so-called “shadow companies” that enable them to continue destroying rainforests.

As part of cross-border investigations The Gecko Project also revealed previously unknown connections between palm oil giant First Resourcesthe billionaire family that owns it and a trio of companies that have reportedly cut down more forest for palm oil than any other company in Southeast Asia. Eight international brands told the Gecko Project that they would stop supplying palm oil from the Singapore company following the revelation.

Canadian, French and Indonesian reporters working for Deforestation Inc. also documented hidden connections between Paper Excellence, one of North America's largest pulp and paper companies, and Asia Pulp and Papera Chinese-Indonesian forestry company accused of environmental destruction and human rights violations.

Both Paper Excellence, recently renamed Domtar, and First Resources have denied to ICIJ's media partners that they are associated with suppliers accused of environmental damage.

The Gecko Project's reporting on RGE's alleged connection to First Resources sparked an investigation by the Roundtable on Sustainable Palm Oil, an industry group, that is ongoing. Meanwhile, environmental groups including Greenpeace have rejected RGE's efforts to re-align with the Forest Stewardship Council, the world's leading sustainability council, and called on the Indonesian government to disclose all of RGE's ties.

“The government needs to take serious action,” Fitra told The Gecko Project. “This is something they can do now. RGE is trying to cheat the system.”