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A worker harvests palm fruits from trees in central Kalimantan in Indonesia
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A palm oil king is cleaning up the industry that made him a billionaire
JASON HOUSTON
“We were made to look like the biggest villain” The sprawling palm oil industry has long been a destroyer of rain forests and tormentor of endangered species across Southeast Asia, to hear environmental groups tell it. And if one executive embodied this $50 billion business, it was Kuok Khoon Hong, a 65-year-old Singaporean commodities magnate. Known as the palm oil king, Kuok is a member of one of Asia’s most powerful business clans and co-founder and chairman of Wilmar International. These days he is no longer portrayed as a villain by activists and nongovernmental organizations. He’s become central to their campaign to prod the palm oil industry to adopt eco-friendly business practices that may start to slow the environmental damage in the region. “I would consider myself an environmentalist today,” he says. “I changed a few years ago when I saw the damage climate change had on the environment in some countries.”
Extracted from the orange pulp of a palm fruit, palm oil is the most used edible oil in the world. You use it every time you brush your teeth, wash your hair, eat ice cream, or put on lipstick. As commodities go, it’s cheap, versatile, and plentiful—palm fruit yields more oil than any other agricultural commodity. Cultivation of palm oil ties up more than 42 million acres worldwide, an area four times the size of Switzerland. The business has made Kuok a billionaire and lifted many communities in Southeast Asia and Africa out of poverty. It’s also led to mass deforestation and a big air pollution problem. Some palm growers still take a slashand-burn approach to clearing forests, although the practice is banned in Indonesia and Malaysia. That sends massive amounts of carbon dioxide into the air. In parts of Southeast Asia, only 5 percent of primary, or virgin, forest
cover remains, according to Global Witness, an environmental group. Kuok’s change in thinking has been gradual and owes much to pressure from shareholders and environmental activists. About two years ago, Norway’s Government Pension Fund Global, the world’s biggest sovereign wealth fund, dumped shares in Wilmar and 22 palm companies, citing environmentally harmful industry practices. Greenpeace videos alleging that palm oil buyers including Unilever and Procter & Gamble contribute to deforestation scored millions of YouTube hits. On an investor call, environmentalists heckled the chief executive officer of Kellogg about buying palm oil from Wilmar. In 2013, Singapore, where Wilmar is based and Kuok lives, was covered in ash from plantation fires tied to the industry. A Chinese immigrant family in British-controlled Malaya, the Kuoks
