IOI Group
Encyclopedia
IOI Corporation Berhad commonly referred to as IOI, was incorporated on 31 October 1969 as Industrial Oxygen Incorporated Sdn Bhd. IOI is one of Malaysia's biggest conglomerates that started off from industrial gas manufacturing. It ventured into property development in 1982, followed by oil palm plantations in 1985. As at June 2009, IOI Group employs more than 30,000 personnel of more than 23 different nationalities in 15 countries.
IOI is listed on on the main board of the KLSE
(now known as Bursa Malaysia). Subsidiaries IOI Properties Berhad and IOI Oleochemical Industries Berhad (Industrial Products) were separately de-listed from the exchange and duly privatized under IOI Corporation Berhad in April 2009 and March 2006, respectively.
IOI also owns 2 resort hotel
s namely Marriott Putrajaya Hotel and Palm Garden Hotel in Putrajaya
. In 2005, IOI Properties was ranked second in The Edge's Malaysia Top 10 Property Developers Award.
The group is currently headed by Tan Sri Lee Shin Cheng, the executive chairman. Lee has two sons and four daughters, all were trained as lawyers. Lee and his family's control of IOI Corporation is held via Progressive Holdings Sdn Bhd. Although all of Lee's children work for the company, sons Dato’ Lee Yeow Chor and Lee Yeow Seng are given more prominence as seen in their representation in IOI Corporation Berhad board of directors.
Plantation is IOI's biggest income generator. As at June 2009, about 65 per cent of the conglomerate profits comes from its oil palm plantations. The group operates 152,000 hectares of oil palm plantations in Malaysia and 83,000 hectares in Indonesian. It has 12 palm oil mills with total milling capacity of 4.1 million tonnes per year at its 80 estates throughout Malaysia.
With oil yield of some 6 tonnes per hectare per year at its matured estates, IOI is the most efficient plantation company in the world. Malaysia's oil palm average yield for the last 20 years is stagnant at 4 tonnes per hectare per year.
IOI's property businesses can be categorized into real estate development and property investment holding branching out to leisure and hospitality. The property segment contributes around 18 per cent of the group’s earnings.
IOI is the largest vegetable oil based oleochemical manufacturer in Asia - held under wholly owned entities IOI Oleochemical Industries Bhd and Pan Century Oleochemical Sdn Bhd with a combined capacity in excess of 750,000 tonnes per annum.
These plants produce fatty acids & esters, glycerine, soap noodles, fatty alcohols, and metallic strearates - that have various industrial applications in the production of food, pharmaceutical, cosmetics, personal care, home care, industrial detergent/ surfactants and lubricant products. Products derived from oleochemicals are more readily biodegradable and hence do not pose a threat to the environment. This is because oleochemicals are derived from renewable resources, as compared to petrochemicals which are obtained from exchaustible or non-renewable petroleum.
IOI's specialty fats businesses are operated under Loders Croklaan, with manufacturing facilities in the Netherlands, North America, and in Malaysia (with combined production capacity of more than a million tonnes per year). Loders Croklaan's customer base include global food giants like Unilever, Nestle, Cadbury and Kraft. IOI's sales offices are spread out in 8 countries serving customers in 65 countries.
Specialty fats provide special function and/or unique solution in food applications and branches out to nutrition / health supplement applications. These fats are use in pastries, confectionery, snack foods and ready-to-eat meals.
(RSPO) and has played an active role in shaping the scheme. The company has several of its estates in Malaysia certified as complying with the RSPO standard. According to the Friends of the Earth
in March 2010 IOI Corporation failed to live up to its green claims of policy. For example:
IOI is listed on on the main board of the KLSE
Kuala Lumpur Stock Exchange
The Kuala Lumpur Stock Exchange dates back to 1930 when the Singapore Stockbrokers' Association was set up as a formal organisation dealing in securities in Malaya...
(now known as Bursa Malaysia). Subsidiaries IOI Properties Berhad and IOI Oleochemical Industries Berhad (Industrial Products) were separately de-listed from the exchange and duly privatized under IOI Corporation Berhad in April 2009 and March 2006, respectively.
IOI also owns 2 resort hotel
Hotel
A hotel is an establishment that provides paid lodging on a short-term basis. The provision of basic accommodation, in times past, consisting only of a room with a bed, a cupboard, a small table and a washstand has largely been replaced by rooms with modern facilities, including en-suite bathrooms...
s namely Marriott Putrajaya Hotel and Palm Garden Hotel in Putrajaya
Putrajaya
Putrajaya is a planned city, located 25km south of Kuala Lumpur, that serves as the federal administrative centre of Malaysia. The seat of government was shifted in 1999 from Kuala Lumpur to Putrajaya, due to the overcrowding and congestion in the Kuala Lumpur areas...
. In 2005, IOI Properties was ranked second in The Edge's Malaysia Top 10 Property Developers Award.
The group is currently headed by Tan Sri Lee Shin Cheng, the executive chairman. Lee has two sons and four daughters, all were trained as lawyers. Lee and his family's control of IOI Corporation is held via Progressive Holdings Sdn Bhd. Although all of Lee's children work for the company, sons Dato’ Lee Yeow Chor and Lee Yeow Seng are given more prominence as seen in their representation in IOI Corporation Berhad board of directors.
Core Business Activities
- Plantation
Plantation is IOI's biggest income generator. As at June 2009, about 65 per cent of the conglomerate profits comes from its oil palm plantations. The group operates 152,000 hectares of oil palm plantations in Malaysia and 83,000 hectares in Indonesian. It has 12 palm oil mills with total milling capacity of 4.1 million tonnes per year at its 80 estates throughout Malaysia.
With oil yield of some 6 tonnes per hectare per year at its matured estates, IOI is the most efficient plantation company in the world. Malaysia's oil palm average yield for the last 20 years is stagnant at 4 tonnes per hectare per year.
- Property
IOI's property businesses can be categorized into real estate development and property investment holding branching out to leisure and hospitality. The property segment contributes around 18 per cent of the group’s earnings.
- Manufacturing of oleochemicals and specialty fats
IOI is the largest vegetable oil based oleochemical manufacturer in Asia - held under wholly owned entities IOI Oleochemical Industries Bhd and Pan Century Oleochemical Sdn Bhd with a combined capacity in excess of 750,000 tonnes per annum.
These plants produce fatty acids & esters, glycerine, soap noodles, fatty alcohols, and metallic strearates - that have various industrial applications in the production of food, pharmaceutical, cosmetics, personal care, home care, industrial detergent/ surfactants and lubricant products. Products derived from oleochemicals are more readily biodegradable and hence do not pose a threat to the environment. This is because oleochemicals are derived from renewable resources, as compared to petrochemicals which are obtained from exchaustible or non-renewable petroleum.
IOI's specialty fats businesses are operated under Loders Croklaan, with manufacturing facilities in the Netherlands, North America, and in Malaysia (with combined production capacity of more than a million tonnes per year). Loders Croklaan's customer base include global food giants like Unilever, Nestle, Cadbury and Kraft. IOI's sales offices are spread out in 8 countries serving customers in 65 countries.
Specialty fats provide special function and/or unique solution in food applications and branches out to nutrition / health supplement applications. These fats are use in pastries, confectionery, snack foods and ready-to-eat meals.
Critics
IOI is a co-founder of the Roundtable on Sustainable Palm OilRoundtable on Sustainable Palm Oil
In response to the urgent and pressing global call for sustainably produced palm oil, the Roundtable on Sustainable Palm Oil was formed in 2004 with the objective of promoting the growth and use of sustainable oil palm products through credible global standards and engagement of stakeholders.The...
(RSPO) and has played an active role in shaping the scheme. The company has several of its estates in Malaysia certified as complying with the RSPO standard. According to the Friends of the Earth
Friends of the Earth
Friends of the Earth International is an international network of environmental organizations in 76 countries.FOEI is assisted by a small secretariat which provides support for the network and its agreed major campaigns...
in March 2010 IOI Corporation failed to live up to its green claims of policy. For example:
- PlantationPlantationA plantation is a long artificially established forest, farm or estate, where crops are grown for sale, often in distant markets rather than for local on-site consumption...
development took place in forestlands without approval of the Ministry of Forestry in conflict with the IndonesianIndonesiaIndonesia , officially the Republic of Indonesia , is a country in Southeast Asia and Oceania. Indonesia is an archipelago comprising approximately 13,000 islands. It has 33 provinces with over 238 million people, and is the world's fourth most populous country. Indonesia is a republic, with an...
legislation - Plantation development took place without approved Environmental Impact AssessmentEnvironmental impact assessmentAn environmental impact assessment is an assessment of the possible positive or negative impact that a proposed project may have on the environment, together consisting of the natural, social and economic aspects....
s - Fraudulent statements were made
- Encroachment has taken place in forests and peat lands
- There is significant increase in fire hot spots
- Corporate claim not to use peat land but to circumvent the issue it does not consider coastal or shallow peat as peatland.
- Corporate claim not to use ’burning policy'. According to the Fire Information for Management System (FIRMS) there were a significant increase in the number of hot spots after land clearing activity start in 2009.
- IOI’s current land development activities may trigger significant land conflicts.