Summoned to meeting with Singapore leaders, top honchos of 10 firms pledge to cooperate with haze probes
In a rare meeting attended by Deputy Prime Minister Gan Kim Yong, Senior Minister K Shanmugam and Minister for Sustainability and the Environment Grace Fu, Singapore outlined proposed legislative amendments that will make it an offence for companies to refuse independent assessments or fail to cooperate fully with investigators.
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SINGAPORE: Senior executives from 10 companies potentially linked to haze-causing fires pledged on Wednesday (Oct 28) to cooperate fully with Singapore’s investigations, after a rare meeting with three ministers.
Deputy Prime Minister Gan Kim Yong, Senior Minister K Shanmugam and Minister for Sustainability and the Environment Grace Fu met the companies' leaders to set out the government's expectations and plans to strengthen laws to hold those responsible for haze pollution accountable.
The ministers were accompanied by Senior Counsel Davinder Singh and senior officials from the Attorney-General’s Chambers, National Environment Agency (NEA) and Ministry of Law.
The companies at the meeting, which lasted less than half an hour, were Bumitama Agri, First Resources, Golden Agri-Resources, Indofood Agri Resources, Kencana Agri, TSH Resources, Wilmar International and Sinar Mas Group.
The government intends to introduce amendments to the Transboundary Haze Pollution Act at the next parliamentary sitting to give the assessment process legal force, making it an offence for companies to refuse to appoint assessors or fail to cooperate fully with their investigations.
“I will be making amendments to the Transboundary Haze Pollution Act at the next parliament sitting to give this framework the force of law. Companies that do not comply will be committing an offence. We will exercise our powers to protect the health of Singaporeans,” Ms Fu told reporters after the meeting at The Treasury.
Mr Shanmugam, who is coordinating minister for national security and home affairs minister, welcomed the companies’ stated willingness to cooperate. He said they would be expected to undergo independent assessments of their operations, corporate relationships and supply chains to establish whether they had contributed to the fires.
The government will pursue all available legal and regulatory avenues to establish responsibility for the fires, which had caused haze pollution in Singapore, warned Mr Shanmugam, who also chairs the Homefront Crisis Ministerial Committee.
"Haze is caused by fires," he told representatives at the meeting. "Fires are caused by irresponsible business practices. It is not a natural phenomenon."
Companies and representatives at the meeting
1) Bumitama Agri: CEO and executive chairman Lim Gunawan Hariyanto
2) First Resources: CEO and executive director Ciliandra Fangiono
3) Golden Agri Resources: Chairman and CEO Franky Oesman Widjaja, who also represented Asia Pulp & Paper (APP) Company and Asia Pulp & Paper Company (China)
4) Indofood Agri Resources: CEO and executive director Mark Julian Wakeford
5) Kencana Agri: CEO and executive director Albert Maknawi
6) TSH Resources: Chairman Kelvin Tan Aik Pen
7) Wilmar International: Chairman and CEO Kuok Khoon Hong
8) Sinar Mas Group: Senior adviser Bernard Tan
“NOT TO FIND SCAPEGOATS”
Mr Shanmugam told the representatives that “the intention of this exercise is not to find scapegoats, nor is it to fix blame for public or political reasons”.
He said a corporate presence and stake in Singapore means having a responsibility to ensure that their operations and supply chains do not contribute to the haze.
"Where there are concerns about a company’s involvement, whether directly or through its corporate relationships or supply chains, we will examine the facts carefully," he said.
"We cannot allow corporate structures or third-party arrangements to stand in our way of establishing the facts."
Companies not involved in the fires, with clean supply chains, would find the assessment helps to establish that and address the government’s concerns, he said.
"If there have been lapses, these will have to be dealt with," he said, adding that the government "will take into account the level of cooperation you have given".
The government will announce appointments to a specialist panel of assessors soon, Mr Shanmugam said.
"One of your identified companies will have to engage a team comprising an investigations firm and a law firm to advise the investigations firm. These will be from the panel, as directed by NEA," he told the representatives.
The law firms will advise the investigations firms, not the companies, because investigators often need legal support for their reports, he said. The companies will bear the cost of the panel teams.
Assessors must be given full access to information, documents, premises and people, along with the companies’ operations, corporate relationships and supply chains, he said.
"The assessors may need to engage third parties or other experts to assist with the assessment. Some examples include remote sensing and geospatial analysts to analyse satellite hotspot data," he added.
The assessors will submit their findings to the NEA, which will take the report into account when deciding further steps, he said.
FACT-FINDING MISSION
Speaking to reporters after the meeting, Mr Shanmugam was asked by CNA whether such an approach might drive some companies out of the country. He said the government seeks to “do what is right for Singaporeans”.
“The companies have been told that if there is no wrongdoing, there will be no issues,” he said.
“We are now on a fact-finding mission, and if companies have been involved in wrongdoing and as a result of the investigation, they wish to leave Singapore, then I think doing right by Singaporeans means accepting that consequence.
“I'm sure Singaporeans will agree to that, rather than us letting the companies go on doing it.”
The authorities still do not know the full extent of the companies’ involvement, he noted.
“I don't want to give the impression that these companies are guilty, nor do I want to give the impression that these are the only companies that are doing this,” said Mr Shanmugam.
Singapore has also issued notices to various other companies without a presence here, he added.
Mr Shanmugam said he was “very direct” with the companies during the meeting about what is expected of them, and emphasised that “the intention of this exercise is not to find scapegoats”.
“I told them we expect full cooperation from the companies, and in the meeting the companies said they will cooperate fully,” he said.
Also addressing reporters, Ms Fu said the government had made clear to the companies its position and expectations, stressing that Singaporeans should not have to bear the consequences of irresponsible business practices.
"The government takes this seriously, and we are determined to act," Ms Fu said. "Even as the haze condition improves, we will not relent."
SGX PROBES, MAS CAUTIONS
Also on Wednesday, Singapore Exchange Regulation (SGX RegCo) said it issued additional queries to seven Singapore-listed companies with agricultural operations and plantations in Indonesia.
The seven companies are Golden Agri Resources, Bumitama Agri, First Resources, Wilmar International, Kencana Agri, Indofood Agri and TSH Resources.
The companies were requested to disclose policies and measures put in place to monitor, prevent and respond to the fires in Indonesia, and the basis on which they assess the adequacy and effectiveness of their measures.
SGX RegCo also asked the companies to disclose their links with the 10 Indonesian companies that were issued preventive measure notices under the Transboundary Haze Pollution Act (THPA). The boards of each company were also asked to provide assessments of and basis for whether the fires and haze have a material impact on their company.
The seven companies were also notified to disclose any queries or investigations by authorities or agencies in Singapore, Indonesia or elsewhere, said SGX RegCo.
These queries come after the companies previously responded to a first round of questions, and are intended to ensure all stakeholders can better assess the basis for the disclosures made so far as well as the extent of the impact that the companies face.
Also on Wednesday, the Monetary Authority of Singapore (MAS) said Singapore banks have been reminded of their responsibility to identify, assess, manage and monitor material environmental risks arising from their activities and exposures.
This includes risks associated with pollution and deforestation, said MAS, adding that banks should take into consideration relevant information released by the NEA under the THPA.
"Where customers may be linked to activities contributing to haze, banks should engage them and obtain sufficient information to understand their role and involvement, including whether adequate measures are in place to prevent, detect and stop fires," said MAS.
Mr Shanmugam previously said banks have lent money to companies with agricultural operations and that banks have to consider risks arising from the environment and legal issues.
MAS said that it cautioned banks to take appropriate measures to mitigate any identified heightened environmental risks, including imposing conditions, reviewing financing terms, limiting further exposures or reassessing the customer relationship.
Clear breaches of environmental laws would warrant stronger measures such as limiting exposures or exiting the relationship, the regulator said, adding that it supports the local banks' clear stance against burning practices.
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