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Who is Inovasi Johan to Meddle with SFI

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In the midst of the controversy surrounding Sabah Forest Industries (SFI) Sdn Bhd’s Sale & Purchase Agreement and the ensuing court battle, a new name has emerged – INOVASI JOHAN SDN BHD.

Who is Inovasi Johan? A check with the archives showed that Sabah Forest Industries Sdn Bhd (SFI) and Inovasi Johan Sdn Bhd (Inovasi Johan) shared the same office and mill address in Sipitang Kompleks S.F.I, No.10, Jalan Jeti, WDT No.31, 89859 Sipitang, Sabah, Malaysia.

Further checks showed that the mill contractor license to operate SFI’s Integrated Timber Complex (ITC) has been leased to Inovasi Johan to produce sawn timber, veneer and plywood for local and export sales since January 2018. Finished goods are mainly exported to Taiwan.

It is unclear at this point on the type of products actually produced at the ITC but it is obvious that Inovasi Johan is central to the business activities at SFI, which is now under receivership by Grant Thornton Consulting (GTC).  

The involvement Inovasi Johan in the affairs of the SFI may have an impact and jeopardise the on-going court proceedings because the company does not have the locus standi to operate in SFI without appropriate concessions from the court. This warrants an investigation by the authorities.

There is an obvious lack of transparency in the manner in which GTC conducts its business at SFI. This is poor governance but more than that it is surprising to note that on 1st September both SFI and Inovasi Johan were issued an Audit Statement to confirm that the companies have demonstrated compliance to the Sabah Legality Standard for Chain of Custody, despite certain unfulfilled terms of the assessment. For example, certain certification to enable operations have not been approved for Inovasi Johan.

The audit affirmation and issuance of mill license requires further investigation to ensure compliance to the laws and regulations of the land. This can get sinister especially when it involves timber concessions, logging and milling activities.

It is important for the authorities to monitor such situations closely. Where required, investigations must be launched. The recent visit by the MACC Chief, Lateefa Koya, to Sabah speaks volumes of the need for clean and transparent business dealings in Sabah. Perhaps, SFI would be a good place to start?    

Alternatively, the Conservator of Forest, Sabah Forestry Department, who purportedly approved the Sabah Timber Legality Assurance System (Sabah TLAS) Sabah TLAS Audit Report Principles 5 & 6 Document should investigate the matter to ensure compliance to corporate governance and transparency practices.

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