ADM Capital looks to A&O Shearman to advise on landmark sustainable investment initiative

ACLF has provided financing to PT Bening Big Tree Farms (BTFI), a manufacturer of coconut neera-based consumer packaged goods, such as sweeteners, sauces and marinades in Indonesia and a subsidiary of Big Tree Farms, Inc., a U.S. company headquartered in Vermont which started organic farming operations in Indonesia in 2000 and has advanced sustainable agriculture practices and reasonable land use.

The transaction is designed to achieve several key impact objectives that align with ADM Capital’s Indonesian Impact strategies to foster sustainable development and climate resilience in Asia. These objectives include:

• Sustainable land-use management: increasing the amount of land farmed using regenerative and organic methods by integrating soil and water conservation and organic nutrient management into additional smallholder coconut farms. This initiative also aims to implement 100% traceability for all coconuts, including those from the external supply chain.
• Livelihood enhancement: ensuring that 100% of the companies’ farmers are certified with Fairtrade Fair for Life by the end of the loan period, with a target of certifying 25,636 farmers by FY2028. These farmers will be paid premium prices, significantly improving their economic stability.
• Carbon sequestration and emission reduction: reducing carbon emissions through improved soil conservation and transitioning away from traditional cooking methods to more fuel-efficient stoves. This objective also includes commitments to no deforestation from farmers.
• Gender empowerment: strengthening the role of women in the coconut supply chain and reducing health risks associated with home-based coconut sugar cooking. Notably, more than 80% of micro-collectors from the companies’ internal supply chain are women.

Felipe Duque, A&O Shearman partner, commented: “This fund represents a significant step forward in sustainable investment, combining financial expertise with a deep commitment to environmental and social impact. This trend is reflective of the growing momentum behind impact investing that we’re seeing in the ASEAN region. We are proud to use our legal expertise to facilitate this partnership, which not only supports the growth of PT Bening Big Tree Farms but also sets a precedent for future impact investments.”

The cross-border A&O Shearman team was led by Felipe Duque with support from Julie Song and Jeff Quin. The team also comprised members from Ginting & Reksodiputro, in association with A&O Shearman, including Tarsis Halintar and Elsa Sari.