"Agri-food giant Japfa’s new sustainability-linked loan overlooks deforestation risk: NGOs", 17 June 2025

Despite longstanding scrutiny over its lack of transparency in addressing deforestation risks across its supply chains, agri-food giant Japfa’s latest sustainability-linked loan (SLL) omitted targets on forest-risk commodities and human rights, environmental groups say.

Instead, Japfa’s US$150 million loan, coordinated by Singapore lender DBS and Dutch bank Rabobank, is focused on reducing freshwater and coal use, as well as improving access to nutrition through a corporate social responsibility programme – which were deemed “key material topics” in its press release…

In response … on why transitioning away from coal – which only made up 1 per cent of Japfa’s energy consumption in 2024 – was one of the selected KPIs for its SLL, a spokesperson said that the KPI will “[help] accelerate the transition, encouraging the group to achieve its [zero coal] target ahead of the 2040 timeline.”

The Japfa spokesperson clarified that the “cleaner energy” it will be transitioning to includes agricultural biomass, such as palm kernel shells, and on-site solar installations, adding that it aims to cut overall fossil fuel use through “efficiency upgrades and improved energy management”.

Japfa, which is one of the largest poultry producers in Indonesia and the rest of Asia, has set a target to half its Scope 1 emissions – those under its direct control – from poultry production and coal by 2040, with the goal to reach net zero emissions by 2050.

The agri-food firm has, however, yet to set targets for its Scope 1 and 2 emissions, which refer to its indirect emissions from electricity usage and value chain emissions, respectively. Based on its latest sustainability report, Scope 3 accounts for the bulk of Japfa’s greenhouse gas emissions, where it put out over 6 million tonnes of carbon dioxide equivalent into the atmosphere in 2024.

When asked whether it has plans to set targets for its Scope 3 emissions, Japfa’s spokesperson told … that they are “largely out of [its] direct control.”

“That said, we are engaging with key suppliers through surveys, ongoing dialogue and alignment with our Supplier Code of Conduct. We continue to assess other relevant areas as part of our evolving environmental, social and governance roadmap,” the spokesperson stated.

In a press release announcing the loan, Adrian Chai, group head of global industries for institutional banking at DBS, said that the SLL leverages the bank’s “deep industry expertise and sustainability advisory capabilities” to help Japfa “further its sustainability agenda.”

Rabobank’s general manager for Southeast Asia Gregory Vandeler said that it is proud to co-facilitate the loan for one of its longstanding clients. “Japfa’s commitment to food security and sustainability across the agri-food value chain aligns with our mission of growing a better world together,” he stated…