Firms linked to haze pledge cooperation in meeting with Shanmugam; government to table changes to haze law

[SINGAPORE] Singaporean companies allegedly linked to haze-related activities have agreed to cooperate fully with the government, Senior Minister K Shanmugam told reporters after a meeting with the firms’ senior leadership on Wednesday (Oct 28).

During the meeting, Shanmugam, who is also coordinating minister for national security, urged the companies to voluntarily undergo assessments of their operations and supply chains.

The government will publicly name the CEOs and companies that voluntarily agree to these assessments, he told executives at the meeting.

Also present were Deputy Prime Minister Gan Kim Yong and Minister for Sustainability and the Environment Grace Fu and senior counsel Davinder Singh.

The government also intends to table amendments to the Transboundary Haze Pollution Act (THPA) at the next Parliamentary sitting on Nov 3.

These amendments, which will be tabled by Fu, will give legal force to the government’s investigative framework, including empowering the National Environment Agency (NEA) to compel companies to appoint assessors, with non-compliance constituting an offence.

During the meeting, Shanmugam told the company leaders that the intention was “not to find scapegoats” nor to “fix blame for public or political reasons”.

“From our perspective, we need to deal with issues that affect Singapore. And we need to be sure that companies which are here conduct their operations in a manner that doesn’t affect Singapore or the region,” he said.

His remarks were in a transcript released to the media by the Ministry of Home Affairs (MHA).

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The closed-door meeting took place just under a week after the government said on Friday that it had issued notices to 10 Singapore-registered companies, seeking information on their operations and potential links to the haze affecting Singapore.

Shanmugam told reporters that all the companies were represented. In attendance were:

• Bumitama Agri: Lim Gunawan Hariyanto, CEO and executive chairman;
• First Resources: Ciliandra Fangiono, CEO and executive director;
• Golden Agri Resources: Franky Oesman Widjaja, chairman and CEO;
• Indofood Agri Resources: Mark Julian Wakeford, CEO and executive director;
• Kencana Agri: Albert Maknawi, CEO and executive director;
• TSH Resources: Kelvin Tan Aik Pen, chairman;
• Wilmar International: Kuok Khoon Hong, chairman and CEO; and
• Sinar Mas: Bernard Tan, senior adviser.

Sinar Mas, an Indonesian conglomerate, owns Asia Pulp & Paper Company and Asia Pulp & Paper Company (China). TSH Resources owns TSH Global Plantation and TSH Overseas. 

According to the transcript, Shanmugam said that haze is caused by fires, and that such fires are “caused by irresponsible business practices” and that they are “not a natural phenomenon”.

He added that the government “takes this seriously” and will give its full attention to the issue.

“We will pursue all available legal and regulatory avenues. We will use all the powers we have to establish responsibility, where there is responsibility. And we will hold those responsible to account,” said the minister.

“And if the facts show that there is no wrongdoing – we will proceed on that basis as well.”

On Oct 23, the government announced that it had appointed Davinder Singh Chambers (DSC) as its adviser to coordinate cross-border inquiries and investigations into companies potentially linked to the haze affecting Singapore. 

It also announced then that it will set up a specialist panel comprising law firms, audit firms and investigative firms to examine the operations, corporate relationships and supply chains of companies identified by the authorities. 

Shanmugam said the appointments to this panel will be announced in the next two days.   

He said that companies that have been identified as having caused or contributed to the haze will have to engage a team comprising an investigations firm and a law firm, to advise the investigations firm. Both entities must be from the panel, he added. 

Shanmugam said that investigation firms will often need legal support from lawyers on their reports, and that the report itself will be coordinated by DSC.

“To be clear, the law firms will advise the investigations firm, and not the companies,” he said, adding that the companies can get their own legal advice.

He noted that many of the companies have expressed commitment to cooperate fully with the government, which is welcomed.

“If your company is not involved in any way in the fires, and your supply chains are clean, the assessment should help to establish that fact and address our concerns,” he added.

“If there have been lapses, these will have to be dealt with. We will take into account the level of cooperation you have given.”

Transboundary Haze Pollution Act amendments

Outlining the proposed amendments to the THPA, Shanmugam said it seeks to empower NEA to issue a formal direction to any entity suspected of contributing or being connected to the fires.

This will then enable the agency to direct that the entities appoint assessors, said Shanmugam, adding that a failure by an entity to comply with the direction would be an offence.

The proposed legislation will also give assessors full access to documents and information, and access to sites and facilities “they decide to be necessary”.

“The assessors will be empowered to look into the entity’s operations, corporate relationships and supply chains,” said the minister. “They will seek to establish whether the entity is in any way involved in causing or contributing to fires that have led to haze pollution in Singapore.”

Following this, the assessors will then issue a report to NEA.

Shanmugam warned that, if the amendments are passed, “failure to provide full cooperation will be an offence”.

“I hope that NEA need not reach the stage of having to make a direction to you,” he told the company leaders.

He also stressed that it would be “in all of our interests” if they can agree to submit to the process today, and proceed with the engagement of the assessors soon without having to wait to have a formal notice issued under law. 

He added that the government will update Singaporeans of the status of the exercise, and that this will not be a one-off process as there is intent for regular evaluations and certifications by the assessors.

Shanmugam told the company leaders that because they have a corporate presence and stake in Singapore, they have a responsibility to ensure that their operations and supply chains do not contribute to the haze.

“The haze has caused real harm to Singapore and Singaporeans. We cannot treat this as an unavoidable fact of life or business,” he said. “The health and well-being of Singaporeans must come first.”