McDermott International, Inc. Batam, Indonesia … International, Inc. – Batam, Indonesia IPLOCA Corporate Social Responsibility 1 Introduction As a leading company in the Batam

McDermott International, Inc. – Batam, Indonesia IPLOCA Corporate Social Responsibility

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Introduction

As a leading company in the Batam region, established over 39 years ago, McDermott International has

a commitment in addressing social issues such as poverty, exclusion, education, protecting the

environment and to provide sustainable benefits to the communities in which the company operates.

Through its CSR program initiated in November 2008, McDermott’s Batam Fabrication Yard plays part in

its responsibility to the community and environment and have executed projects fully funded by the

company. Prior to its formal CSR, McDermott supported various programs for the betterment of the

local community.

The responsibility to the community and environment is not only done through the CSR program but

also through the Batam International Charity (BIC), a registered charity managed by a committee of

employees and senior management of McDermott. BIC provides assistance in the areas greatest needs

in the local community of Batam. Basic necessities item including but not limited to school support,

orphanage buildings for the many impoverished orphan children, medical support to the poor and

support in disaster relief are all part of BIC’s mission statement. BIC projects are funded through an

annual golf tournament event organized by McDermott staff. Through the generous donations via

corporate and individuals sponsorship, BIC celebrated its “10 Years of Giving” in 2011 and since its

inception has raised approximately USD $2 million. The success of the charity is recognized locally and

has encouraged others to take an active interest in social work to support those in need in the region.

For more information on BIC, please visit our website at http://bataminternationalcharity.org/

CSR Projects

1. EDUCATION

1.1 SCHOLARSHIP

Since 2001, McDermott has been providing scholarships to students from various

universities in Indonesia with professional placement upon graduation. On the island of

Java, McDermott has provided scholarships to three universities and since December 2010,

a total of 71 recipients have benefitted from the scholarship program with many of them

occupying key positions within our company.

One example is Asep Nurul Haq. Asep is now an Asst. Division Engineer

and is currently on temporary assignment in our Singapore Engineering

office.

In 2008, McDermott continued the scholarship program on the island of

Sumatra to five universities with a total of 20 recipients by the end of

December 2010.

The scholarship covers the schools’ tuition fees, living allowance along with Java and

Sumatra thesis and attachment universities programs.

http://bataminternationalcharity.org/


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1.2 APPRENTICESHIP PROGRAM

McDermott accommodates students from both universities and high schools for

apprenticeship. This is to enable students to increase and develop their knowledge by

providing on the job training, related classroom instruction, as well as incentives to attract

them to improve their job skills. The length of apprenticeship program varies from one to

four months dependent on curriculum requirements. The majority of apprentices train in

electricity, engineering, plumbing, pipefitting, mechanics, information technology,

accounting and administration. Below is a table explanation of the McDermott

apprenticeship program through March 2011.

Level 2006 2007 2008 2009 2010 2011

High School 70 102 88 80 46 38

College / Universities 61 79 63 55 19 4

Total 131 181 151 135 65 42

1.3 EXCURSION PROGRAM

The company accommodates excursion programs for students and teachers from all

universities in Indonesia in order to give them access to on the job work experiences.

Picture Above: ITB Students on Excursion Program

Picture Above: Indonesian Universities Lecturers on Excursion Program


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1.4. PARTNERSHIP PROGRAM WITH LOCAL TECHNICAL HIGH SCHOOL

In 2009, McDermott began supporting the Government Technical High School – SMKN 1

Batam to establish a Welding Industrial Class by developing curriculum, learning modules

and subject matter experts to teach. The first group of 22 students is scheduled to complete

by June 2011 with the second group of 24 students scheduled to start the next class by July

2011.

Picture Above: SMKN 1 briefing

1.5 SUPPORT FOR INTERNATIONAL SCHOOL

McDermott has continuously supported one of the local international schools in Batam,

Global Indo Asia School, by providing IT equipment for the early childhood in addition to the

higher grades. The effort is done to help the local community offset tuition costs and allow

students to access state of the art computer laboratories for studies.


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Picture Above: Early Childhood Centre with new PC

Picture Above: Higher Grade Computer Lab

1.6 WOMEN WELDER PROGRAM

McDermott is the first private enterprise in Batam that has trained women welders and

offered them employment once they complete training and are qualified. It is the

company’s desire that this initiative set the benchmark for all major industries in Batam to

allow opportunities for women to enter and contribute in a predominantly male workforce.


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1.7 SKILL TRAINING PROGRAM FOR PEOPLE WITH SPECIAL NEED

Another skill training program provided for the local community of Batam is to the people

with special needs to help assist them by improving their ability to survive on their own. To

date, two different training programs have been developed, welding for home industry and

culinary training.

1.8 SKILLS TRAINING FOR STREET TEENAGERS

Batam has a high number of teenagers that live on the streets. These teens beg and sing to

earn a meager living. McDermott developed a basic mechanic training course for 16 of

these teenagers. To enhance their reading skills, McDermott also provided used books

collected from its employees.


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2. ENVIRONMENT

The company’s commitment to a green environment is not only carried out within the business

but also outside in the community.

2.1 PLANTING MANGROVE TREES

Since 2009, eight hectares of destroyed sea terrain area has been reconstructed by planting

approximately 13,600 mangroves seedlings in two areas, Blonkeng Island and Patam Lestari.

This process helps the community protect the shorelines from erosion.

Picture Above: Destructed sea terrain at Blonkeng Island

Picture Above: Re-planted sea terrain at Patam Lestari


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2.2 COMPOSTING PROGRAM

Since November 2008, McDermott has provided a composting plant facility for a

neighboring community at Tanjung Sengkuang, Batu Ampar, Batam and Kampung Melayu

Batu Besar, Batam. With this program, the community has managed to process their

garbage to become compost and organic fertilizer which reduces the volume of garbage that

is thrown to the final dumping area. At the same time, this program helps in developing an

environmental and financial stewardship among the community members as the fertilizer is

recycling waste and has an economic value.

McDermott is proud that this program had been recognized by others companies in Indonesia and has become a success example of the CSR program. One company, PT. Astra Otoparts Tbk, visited the composting site to see firsthand and benchmark the program on 6th April 2011. A total of 23 branch managers of the joint venture company reviewed the small facility and witnessed how the machine works.


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2.3 GARBAGE FACILITY & ROAD BEAUTIFICATION

In the local village of Batu Merah, McDermott provided a motor cart for transporting and built a proper waste bin to sort waste for recycling. Prior conditions were unhealthy and difficult to manage.


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In conjunction with a government program to beautify Batam, McDermott chose an area of

roadway along Kerapu Road and Batu Ampar to clean and plant small trees and greenery. In

addition, McDermott sponsors a quarterly roadside cleaning program which began in the

summer of 2010. Employees and clients work together to clean the roadside of rubbish to

promote our clean program with the motto “Batam Clean, It’s What We Have”!

Before After

Photos of Batam Clean Up Day Program

3. OTHERS CSR PROGRAM

3.1 KIDS HELMET PROGRAM

With the intention of protecting employees’ children from potential injury and raising

general road safety awareness, the management of three McDermott facility projects

(Chevron Platong Gas II, Woodside North Rankin B and Esso Kipper Tuna Turrum) funded

standard (SNI) children’s’ size motorcycle helmets for all local employees. The symbolic

handover was held on 30 November 2010 and attended by representatives of each project

and McDermott management in Batam. The helmets were distributed in November 2010.


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3.2 SAFETY AWARD LUCKY DRAW

To increase awareness and promote our facility free from hand injury, employees, Martua

Ganda Simanjuntak and Faber Hutapea were chosen during the safety award lucky draw.

Both employees were awarded a 32 inch LCD TV.


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Batam International Charity Fund Raising Events at a Glance

The Batam International Charity (BIC) is totally funded by money raised through an annual event

organized by McDermott staff. The event, previously known as the Batam Charity Bash, includes an

evening cocktail party, a golf tournament and an awards’ dinner. Funds are raised via corporate and

individuals sponsorship. The event celebrated its 10 Years of Giving in March 2011.


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Batam International Charity Projects

1. SCHOOL SUPPORT

BIC started the charity program in 2002. As of June 2010 (school fees paid in the month of June

every year), there have been 3,065 children supported through the school fee and uniform

program.

Year of Donation No of School No of Children

2002 8 268

2003 4 331

2004 5 204

2005 17 508

2006 8 359

2007 5 201

2008 10 397

2009 13 313

2010 47 484

Total 117 3065

2. ORPHANAGE SUPPORT

2.1 FOOD SUPPORT

BIC provides a bi-monthly food support program for the orphans and the destitute.


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2.2 ORPHANAGE EQUIPMENT SUPPORT

In addition to food support, orphanages whose facilities’ equipment and supplies are no

longer suitable, BIC has provided new replacements.

Before After

2.3 ORPHANAGE CARING PROGRAM

BIC schedules a bi-monthly caring program for the children of the orphanages to allow them

a fun and enjoyable day with food and games.


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3. GENERAL SUPPORT

3.1 HOUSEKEEPING PROGRAM

The quarterly housekeeping program provides a team of volunteers that work with an

orphanage for a day of cleaning. The program teaches the orphans how to live take care of

their dormitories and to live within a healthy and clean environment.


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3.2 SUPPORT FOR DESTITUTE

Newborn & Pregnancy Program

Elderly Program

3.3 USED COMPUTER DONATION


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4. BUILDING SUPPORT

Since its beginning in 2002, BIC has constructed 49 orphanages and schools in Batam. The

construction projects vary between the roof repairs, ceiling and toilet renovation, kitchen

renovation, fencing and handrails installation, new water storage tanks and new build

orphanages.

RESTU ILAHI ORPHANAGE – WATER STORAGE TANK

Before After

BETHESDA ORPHANAGE - FENCING

Before After


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ANNUR ORPHANAGE – WATER STORAGE TANKS

Before After

RIZKY KHOIRUNNISA ORPHANAGE – STAIR HANDRAILS

Before After

ALBARKAH ORPHANAGE – NEW CONSTRUCTION SPONSORED BY EXXON MOBIL

Before After


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RIYADHUS SALIHIN ORPHANAGE – NEW CONSTRUCTION BY BIC

Before After

5. MEDICAL SUPPORT

Various degrees of support have been given in surgeries of hydrocephalus, colostomy and

herniated children.


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6. HINTERLAND SUPPORT

BIC supports are also given to provide toilet construction and school support for SDN 003 and

basic necessities support for the island communities.

-END-

Documents

McDermott International, Inc. Batam, Indonesia … International, Inc. – Batam, Indonesia IPLOCA Corporate Social Responsibility 1 Introduction As a leading company in the Batam