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Ada Pertanyaan? Hubungi Kami Marcell Sihombing, Kartini L. Makmur
Mining fields. Photo by: ADY
The renewal of Freeport’s current mining license (kontrak karya) remains a controversial issue, and debate relating to any possible extension is raging once again within the corridors of power and has become a topic of media speculation. The primary focus of the current debate is familiar though, namely that any decision should prioritize the welfare of Indonesian citizens above all else.
It is well-known that the presence of mining companies in many countries around the world brings disadvantages to their populations, as opposed to new prosperity. In this context, the question popularly coined by Roderick G. Eggert, namely, “Is mining a curse?” is often wheeled out whenever matters such as this are discussed.
Dody Prayogo, a professor of sociology at the University of Indonesia, believes that three major issues are of major importance to mining companies and the communities which surround them. Firstly, there is the matter of social justice and the rights of local communities. Next comes the issue of social equity, as it relates to access to sources of welfare. Finally there’s the question of guaranteeing social sustainability, as the presence of mining activities in any community often changes and damages the surrounding environment.
Mr. Prayogo explained to Hukum Online that the issue of social justice is usually reflected in claims made by local communities, who feel that their rights are being violated. Prayogo further elaborated that such rights violations commonly relate to issues of land rights, and often manifest themselves in the indigenous farmers who end up losing their way of life and means of making a living.
“Local communities may try to re-establish their indigenous identities in an attempt to rectify any injustices that they are suffering. However, this approach can often end in conflict,” explained Mr. Prayogo in the Jakarta satellite city of Depok on 3 October 2015.
Mr. Prayogo also stated his belief that the issues of social equity that may arise were not primarily due to presence of mining companies impoverishing local communities. Instead, he thinks that the main reasons for any underlying tensions are emerging economic and social inequalities within a given community, a situation new to many populations.
Mining presents new economic opportunities, according to Mr. Prayogo, however, these opportunities are inaccessible to large sections of a given community. As a result, income disparities emerge between employees and non-employees, farmers and company owners, and indigenous populations and employees who originally come from other areas of the country.
According to Mr. Prayogo, mining companies need to engage in affirmative action so that their presence within a given community gains social legitimacy. Companies will not operate optimally whenever sharp disparities arise between company employees and the surrounding communities. Affirmative action, Mr. Prayogo believes, can be undertaken under the umbrella of a corporate social responsibility (CSR) program.
“Therefore, for mining companies, a CSR program should not merely express an underlying philanthropic impulse, but should be seen more as an obligation. Mining companies require social legitimacy, specifically the acceptance and support of the surrounding communities, while said communities also deserve their fair share of any wealth that is produced,” emphasized Mr. Prayogo.
Offering further insight, Mr. Prayogo revealed that, for mining companies, CSR was a way of ensuring that the so-called “corporate social share” was distributed among local communities. However, Prayogo also stated that providing such a share in the form of a philanthropic donation – still seen as socially acceptable – was far from ideal as regards efforts to improve social equity.
Far more praiseworthy, Mr. Prayogo believes, are the companies who engage in so-called “profit sharing,” namely sharing a portion of their profits among local communities. Many national and multinational companies establish foundations in order to perform this type of CSR, and manage to successfully build up a positive image in doing so.
“However, mining companies really need an even higher level of CSR, which should ideally become an integrated part of production costs. The costs involved in the creation of social equity must be fully integrated into the system of production, as local and indigenous communities themselves can be considered an essential part of industrial production,” asserted Mr. Prayogo.
In the context of the above statement, Mr. Prayogo emphasized that the concept of CSR, as engaged in by mining companies, should encompass an even more comprehensive meaning. His belief is that CSR efforts must integrate the exploitation of natural resources by mining industries with the existence and interests of local communities. Under these conditions, Mr. Prayogo believes that the term “Socially Responsible Corporation” (SRC) can come to replace CSR as the dominant paradigm, and offers a better model for a prosperous and harmonious future.
“Regardless of any final results, the implementation of SRC programs will mean that mining companies are showing their ethical commitment to achieving social equity. It means that they have attempted to minimize the disparities that emerge between their mining efforts as global corporations and the local societies and communities who mainly consist of the indigenous inhabitants of rural areas,” concluded Mr. Prayogo.
(sp)
Marcell Sihombing, Kartini L. Makmur
Mining fields. Photo by: ADY
The renewal of Freeport’s current mining license (kontrak karya) remains a controversial issue, and debate relating to any possible extension is raging once again within the corridors of power and has become a topic of media speculation. The primary focus of the current debate is familiar though, namely that any decision should prioritize the welfare of Indonesian citizens above all else.
It is well-known that the presence of mining companies in many countries around the world brings disadvantages to their populations, as opposed to new prosperity. In this context, the question popularly coined by Roderick G. Eggert, namely, “Is mining a curse?” is often wheeled out whenever matters such as this are discussed.
Dody Prayogo, a professor of sociology at the University of Indonesia, believes that three major issues are of major importance to mining companies and the communities which surround them. Firstly, there is the matter of social justice and the rights of local communities. Next comes the issue of social equity, as it relates to access to sources of welfare. Finally there’s the question of guaranteeing social sustainability, as the presence of mining activities in any community often changes and damages the surrounding environment.
Mr. Prayogo explained to Hukum Online that the issue of social justice is usually reflected in claims made by local communities, who feel that their rights are being violated. Prayogo further elaborated that such rights violations commonly relate to issues of land rights, and often manifest themselves in the indigenous farmers who end up losing their way of life and means of making a living.
“Local communities may try to re-establish their indigenous identities in an attempt to rectify any injustices that they are suffering. However, this approach can often end in conflict,” explained Mr. Prayogo in the Jakarta satellite city of Depok on 3 October 2015.
Mr. Prayogo also stated his belief that the issues of social equity that may arise were not primarily due to presence of mining companies impoverishing local communities. Instead, he thinks that the main reasons for any underlying tensions are emerging economic and social inequalities within a given community, a situation new to many populations.
Mining presents new economic opportunities, according to Mr. Prayogo, however, these opportunities are inaccessible to large sections of a given community. As a result, income disparities emerge between employees and non-employees, farmers and company owners, and indigenous populations and employees who originally come from other areas of the country.
According to Mr. Prayogo, mining companies need to engage in affirmative action so that their presence within a given community gains social legitimacy. Companies will not operate optimally whenever sharp disparities arise between company employees and the surrounding communities. Affirmative action, Mr. Prayogo believes, can be undertaken under the umbrella of a corporate social responsibility (CSR) program.
“Therefore, for mining companies, a CSR program should not merely express an underlying philanthropic impulse, but should be seen more as an obligation. Mining companies require social legitimacy, specifically the acceptance and support of the surrounding communities, while said communities also deserve their fair share of any wealth that is produced,” emphasized Mr. Prayogo.
Offering further insight, Mr. Prayogo revealed that, for mining companies, CSR was a way of ensuring that the so-called “corporate social share” was distributed among local communities. However, Prayogo also stated that providing such a share in the form of a philanthropic donation – still seen as socially acceptable – was far from ideal as regards efforts to improve social equity.
Far more praiseworthy, Mr. Prayogo believes, are the companies who engage in so-called “profit sharing,” namely sharing a portion of their profits among local communities. Many national and multinational companies establish foundations in order to perform this type of CSR, and manage to successfully build up a positive image in doing so.
“However, mining companies really need an even higher level of CSR, which should ideally become an integrated part of production costs. The costs involved in the creation of social equity must be fully integrated into the system of production, as local and indigenous communities themselves can be considered an essential part of industrial production,” asserted Mr. Prayogo.
In the context of the above statement, Mr. Prayogo emphasized that the concept of CSR, as engaged in by mining companies, should encompass an even more comprehensive meaning. His belief is that CSR efforts must integrate the exploitation of natural resources by mining industries with the existence and interests of local communities. Under these conditions, Mr. Prayogo believes that the term “Socially Responsible Corporation” (SRC) can come to replace CSR as the dominant paradigm, and offers a better model for a prosperous and harmonious future.
“Regardless of any final results, the implementation of SRC programs will mean that mining companies are showing their ethical commitment to achieving social equity. It means that they have attempted to minimize the disparities that emerge between their mining efforts as global corporations and the local societies and communities who mainly consist of the indigenous inhabitants of rural areas,” concluded Mr. Prayogo.
(sp)