Indonesia’s cocoa industry plays a crucial role in both local economies and global markets. However, declining productivity, aging trees, and the growing impacts of climate change continue to challenge its long-term sustainability. To address these issues, Sugata (PT Kudeungoe Sugata), a purpose-driven cocoa enterprise focused on sustainable livelihoods and environmental restoration, is leading efforts to advance regenerative cocoa production with support from KOLTIVA and global partners, including Unilever, the UK Foreign, Commonwealth & Development Office (FCDO), and EY through the TRANSFORM Bestari Challenge. The initiative aims to accelerate innovation for smallholder farmers by integrating digital traceability, climate-smart agriculture training, and inclusive financing models. By combining Sugata’s community-based approach with KOLTIVA’s proven technology ecosystem—including KoltiTrace for farm-to-bar traceability and KoltiSkills for training delivery—the collaboration seeks to build a resilient cocoa value chain that drives income diversification and supports forest conservation. Founded in 2018, Sugata has established itself as one of Indonesia’s first bean-to-bar enterprises sourcing directly from smallholders. Its mission to regenerate degraded lands and restore livelihoods positions the company as a frontrunner in sustainable cocoa innovation. Located in the eastern flank of Aceh’s 2.6 million-hectare Leuser Ecosystem, one of the world’s last intact tropical rainforests and home to Sumatran tigers, elephants, rhinos, and orangutans, the province’s cocoa belt supports local communities. With over 101,000 hectares of cocoa and an annual output of 41,000 tons, Aceh ranks as Indonesia’s fourth-largest cocoa producer. The region’s forests, rivers, lakes, and peatlands provide ecosystem services—including clean water for four million people—valued at over US$600 million annually. Yet, aging trees, pests, erratic weather, and deforestation threaten both livelihoods and ecosystems, with 20% of lowland forests lost over the past five years. Global policy drivers such as the EU Deforestation Regulation (EUDR), the UN Sustainable Development Goals (SDGs), and corporate zero-deforestation pledges are steering cocoa toward a new era. Regenerative cocoa, cultivated under biodiverse canopies and managed through agroforestry, nutrient recycling, and digital traceability, is not only a conservation strategy but also a pathway to long-term profitability and regulatory compliance. In 2024, the TRANSFORM Bestari Challenge, co-led by Unilever, FCDO, and EY, invited Indonesian enterprises to pilot solutions advancing the SDGs, offering grants of up to £300,000. The accelerator combines funding with tailored business support to address complex development challenges. In October 2024, Sugata was named one of three winners, securing funding to pilot regenerative cocoa in Southeast Aceh. This 18-month project brings together Sugata, KOLTIVA, Unilever, FCDO, and EY to make regenerative cocoa measurable, scalable, and commercially viable. Sugata engaged KOLTIVA as its implementation partner to deliver digital traceability, farm-level training, and real-time data-driven decision-making. The initiative includes five integrated workstreams: Gender Action Learning System (GALS), Demo Plot Management, Regenerative Agriculture and Agroforestry, Cocoa Waste Management, and GHG Monitoring. These efforts embed sustainability into every pod, plot, and producer decision, demonstrating that regenerative cocoa production can balance productivity, profitability, and environmental stewardship. Joe Keen Poon, Executive Chairman of KOLTIVA, said:“What we’re building with Sugata, Unilever, and FCDO in Aceh is more than a project—it’s a blueprint for responsible cocoa. Smallholders deserve not just compliance requirements, but technology, training, and fair opportunities to thrive in global markets. By integrating real-time farm data, gender-inclusive decision-making, and carbon tracking, we are proving that regeneration and profitability can go hand in hand.” Since late 2024, Sugata and KOLTIVA have co-developed training curricula, secured demonstration sites, and trained master trainers for field implementation. Within the first year, more than 500 cocoa producers across 21 villages have received training through KoltiSkills. Ten regenerative demo plots with live emissions tracking have been established, five biochar units convert cocoa waste into compost, 173 plots have been surveyed for GHG baselines, and over 100 households have adopted gender-inclusive decision-making models through GALS. Jessica Pauline, Country Lead for Finance & Business Development at Unilever Indonesia, said:“Sugata demonstrates strong commitment to positive social and environmental change. Impact enterprises like Sugata are essential to solving global sustainability challenges. Beyond funding, TRANSFORM leverages cross-sector collaboration to help enterprises scale their impact.” Despite challenges such as erratic weather and varying digital literacy, the initiative is already showing how technology, data, and inclusive participation can reshape cocoa farming—delivering measurable environmental benefits, diversified incomes, and greater resilience for smallholder communities.
