PROPER AS TOOL TO IMPLEMENT GREEN INDUSTRY

Sigit Reliantoro

Buyer Forum – International Labour OrganizationJakarta, June 10th 2014

Introduction

PROPER is environmental program to promote and enforce environmental regulation, compliance with pollution control

standards and encourage pollution reduction

1995-2005

The program’s objective are promote and enforce compliance,

encourage pollution reduction, introduce the concept of green

economy, and promote an environmental management system and conduct the business ethically

through the implementation of community development

2005-…..

There has been a changing understanding of the nature of environmental challenges. The problems of large-scale discharge of harmful pollutants have either been controlled or the regulatory regimes for tackling these have been firmly developed

Focus has shifted to wider issues of continual improvement, resource use, energy efficiency, product quality, etc. (Farmer, 2007).

1995 201419 years

A color-coded rating scheme was developed under PROPER to grade companies performance against the regulatory standards. The color coding system is based on five colors—gold, green, blue, red, and black.

GOLD is awarded to company that demonstrate environmental excellency consistenly in production and services, conducting business ethically and responsible to community;

GREEN is awarded to company that implement environment management procedures go beyond the expected compliance through implementation of Environmental Management System, pollution prevention, 4R (Reduce, Reuse, Recycle and Recovery) principles, and contribute to community development;

BLUE is awarded to company that display compliance to environmental regulations;

RED is awarde to company that display some sort of pollution control effort but do not comply with the regulatory standards in absolute terms

BLACK is awarded to company that does not make any attempt to control Pollution .

PROPER MECHANISM

BEYOND COMPLIANCE AREA

COMPLIANCE TO REGULATIONS

BASIC PRINCIPAL OF PROPER CRITERIA

BLUE

RED

BLACK

SEA POLLUTION CONTROL REGULATIONHAZARDOUS WASTE REGULATION

AIR POLLUTION REGULATIONWATER POLLUTION REGULATION

EIA REGULATIONNO EFFORT

INCOMPLIANCE

COMPLY

GOLD

GREEN

SUB

SCORE

SCORE

Passing Grade

Passing Grade

Best Practices ; Best Available Technology;Best Corporate Social Responsibility

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ENVIRONMENTAL EXCELENCES

Compliance Criteria• Compliance criteria are integration of regulation regarding:

– environmental permits and environmental impact assessment – water pollution control, – Air pollution, – Hazardous waste management– Land Degradation Criteria for mining industry

• To date more than 46 regulations have been integrated into the assessment criteria.

PROPER PROGRESS

In 2012-2013 1812 industries were involved in PROPERIt is targeted 2000 industries will be monitored by PROPER in 2014

PROPER participating companies mostly come from the Palm Oil Industry, Hotel, food and beverage, oil distribution, Exploration and Production of Oil and Gas, Hospital, textiles, coal mines, the sugar industry and so on

Palm Oil 16%

Hotel6%

Food & Beverages6%

Hospital6%

Oil & Gas Distribution

5%

Oil & Gas Exploration & Production

5%

Rubbert4%

Tekstil3%

Coal Mining3%

Gula3%

Energi PLTD3%

Industri Kimia2%

Otomotif2%

Minyak Goreng2%

Tambang Mineral2%

Komponen Oto-motif

2%

Pengolahan Ikan2%

Pelapisan Logam1%

Kertas1%Energi PLTU

1%

Kawasan Industri1%

Elektronik1%

Farmasi1%

Tapioka1%

Pengolahan Logam1%

Tepung1%

Petrokimia1%

Kayu Lapis1%

Semen1%

Susu1%

Pakan Ternak1%

Energi PLTP1%

Keramik1%

Cat1%

Energi PLTGU1%

FACTS PROPER PUSH THE LEVEL COMPANY'S REGULATORY COMPLIANCE ENVIRONMENT

50%

38%

12%

RATINGS UP

RATINGS REMAIN

RATINGS DOWN

25%

64%

11%

PERIOD 2009 - 2010

BLACK RED BLUE GREEN GOLD

2008 -

2009

BLACK 24 16 12

RED - 5 23 16

RED 1 33 42

BLUE- 2 48 166 5 2

BLUE 9 143 18 1

GREEN 2 6 30 5

GOLD 1 0

PERIOD 2010 - 2011

BLACK RED BLUE GREEN GOLD

2009 -

2010

BLACK 3 10 10

RED 11 56 81 3

BLUE 1 49 319 55

GREEN 1 1 9 39 4

GOLD 1 1

RATINGS UP

RATINGS UP

RATINGS UP

Based on the evaluation of 634 companies that follow the PROPER for 2 years in the period 2008-2010 up to 2009-2011• 50% improved performance

(improved ratings)• 38% fixed• 12% experienced a decrease

in performance (rank down)

For the period 2009-2010 up to 2010-2011, from 654 companies:• 25% experienced

improvement• 64% fixed• 11% decrease environmental

management performance

Law Enforcement for Black Rating

79 BLACK RATING

INDUSTRIES IN 2011-

2012

71 INDUSTRIES WERE IMPOSED GOVERMENT

ORDER SANCTIONS

4 INDUSTRIES WERE RECOMENDED FOR CRIMINAL LAW ENFORCEMENT

1 INDUSTRIES WAS RECOMENDED FOR LIABILITY ENFORCEMENT

3 INDUSTRIES WERE CLOSED DOWN

ENVIRONMENTALLAW

ENFORCEMENT MECHANISM

PROSECUTION & COURT SYSTEM

PROPER MECHANISM

Beyond Compliance Criteria9 area of beyond compliance assessment :1. Summary of Environmental Performance Report (Sustainability

Reporting)2. Implementation of Environmental Management Systems 3. Energy efficiency 4. Emission Reduction and Alternative Energy Utilization5. Water Conservation and Pollution Load Reduction 6. 3 R Hazardous Waste7. 3 R Solid Waste 8. Biodiversity Protection 9. Implementation of Community Development (Community Development)

Beyond Compliance Criteria Approach

• The Green & Gold criteria provide platform for industries to develop environmental excellencies base on their own specification.

• It borrow ideas of Timothy John "Tim" Berners-Lee in develop The Hypertext Transfer Protocol (HTTP).

• The platform base on PDCA principles (Plan – Do – Check – Adjust).

• Foundation Is Environmental Compliance

Inovation

Additionality

Benchmarking

RESULT

Plan – Do – Check – Action

ENVIRONMENTAL REGULATION COMPLIANCE

SYSTEM

EVIRONMENTAL EXCELENCE

OUTPUT

BEYOND COMPLIANCE PERFORMANCE

0

50

100

Migas EP Tambang Pupuk, Semen, Energi PLTU, Pulp Paper, Petro Kimia, Refinery

Energi Kertas, farmasi, kimia, tekstil, sepatu, kaca, otomotif Migas Distribusi

Kawasan Industri Pelapisan Logam Sawit

Consumer good & makanan Gula & Karet

OVERVIEW PROPER

PROPER ACHIEVEMENTSSector Unit Produced

ManagedUntreatedTemporary

Storage Third PartyIncinerated / Bioremiation 3 R internally

Oil Gas, energy, Mining Ton 87,333,422.820 73,831,764.170 13,501,658.650

Manufakturing Ton 3,017,281.341 14,214.325 58,946.591 4,492.675 2,032,762.434 906,865.316Industrial Estated

Ton 4,008,245.690 34.304 3,870,602.450 126,732.049 10,587.500 289.387

Agro industry Ton 86,670.751 26,933.203 29,889.336 0.627 37.526 29,810.059

Total Ton 94,445,620.602 73,872,946.002

3,959,438.377 131,225.351 2,043,387.460 14,438,623.412

Total Ton 94,445,620.602 80,006,997.191 14,438,623.412

PROPER managed to push the management of hazardous waste properly. In 2011 as 94,445,620.602 ton hazardous waste successfully managed. • 80,006,997.191 tons (84.71%) were managed in accordance with the

regulations (including temporary storage of hazardous waste and toxic materials, delivery to a 3rd party who has a permit, processing and 3 R internally)

• 2.56% are utilized internally (3 R ) by the company or equal to 2,043,387.460 tons

Community Development

1,857 Trillion of funds channeled through the Community Development program from 311 companies awarded Green and Gold rating .

It is also consider internal corporate social responsibility in Community Development Criteria

0

500

1000

1500

2000

2010 2011 2013

731 928

1.857

Jum

lah

Angg

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CSR

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PRO

PER

(Mily

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Tahun

1. The existence of trade unions2. Has a collective labor agreement3. Has a dispute resolution system

governance4. Evidence - Note labor disputes at

least 2 last years5. Showed a decrease in labor

disputes at least 2 last years

PROPER WBSITEhttp://proper.menlh.go.id/portal/

Since March 25th 2012 – It has been accessed by 180.021 visitors

The visitors from 249 cities and 44 countries.

Thank You