It was 20 years ago, during the Asian Financial Crisis that was one of the biggest tests of Sukanto’s entrepreneurial journey. He recalled having to divest a 50-50 venture with a European partner in China.
As a result, Sukanto brought in almost $1 billion back to Indonesia and felt it was the right strategic decision for “short term pain, long term gain.”
Anderson remembered that it was not an easy decision for his father and that’s a lesson the family still holds closely.
“To me that takes … vision and also it takes guts … he always tell me one thing that you can have the best machines in the world but if it’s not complete, it’s equivalent to scrap,” Anderson said. “So we have to complete the project so he took that gamble. And sold one of our assets in China just to reinvest in Indonesia and it has paid off because this is where we are right now.”
Currently, three out of the four Tanoto kids work for RGE, but Tanoto policy meant they had to gain experience outside before joining the family business. Anderson worked as a consultant at Bain & Company, while Belinda spent a year as an analyst at Morgan Stanley.
“I learned a lot about how to manage a relationship with the Chinese stakeholders which I eventually used and applied when I was a salesperson for the family business based out of Shandong in China,” Belinda said.
Sharing the same last name as the founder however, does not equate to a leadership role; each of RGE’s business units is run by a professional CEO. In addition, when it comes to succession planning, the topic is one that the children remember discussing since they were teenagers.
Anderson and Belinda both reiterated the Tanotos’ view that keeping it in the family isn’t as important as finding the right people.
“Succession planning is a business succession planning for us… it’s not about having a family member running the company, (it) is who’s the best person to be able to run the company … we don’t differentiate professional managers or a family member that’s working in a company … it’s capability based rather than in title based,” Anderson said.
Catch the second season of Lasting Legacy, Thursdays in June, on CNBC Asia at 17:30 SIN/HK and on CNBC EMEA at 23:30 CET.
Correction: This article has been updated to reflect the correct spelling of Kerinci and the number of Tanoto kids who work for RGE. Multiple quotes have also been clarified.