1. The Ministry of Environment, Indonesia
Public Disclosure System as an effective tool for pollution control The Implementation of PROPER in Indonesia
Hermien Roosita
The Ministry of Environment, Indonesia
Paris, 2-3 December 2004

2. Environmental Management in Indonesia
Shifting from end-of-pipe to clean production
No regulation
No environmental institution
Lack of government & corporation interest
End of pipe management
Environmental regulation
Government intervention
Clean production
Public Disclosure System
Economic instruments
Integrated environment management
Ecological efficiency
Partnership between government & corporation
1982
1995
PRESENT 1 2 3 4
FUTURE

3. Environmental Compliance Implementation
Monitoring tools for Industrial Pollution Control : PROKASIH, Blue Sky Program, Hazardous Waste Management Program
Litigation
7 steps for dispute resolution :
Surveillance for information and data collection
Investigation for evidences
Legal brief
Trial
Appeal to high court
Appeal to supreme court

4. Current Situation: Good Environmental Law But Weak Implementation
Weak monitoring system :
Human resources capacity
Financial supports
Lack of coordination between agencies.
Lack of knowledge on environmental issue by stakeholders.

5. Alternative solutions for industrial pollution control
NGO and community have function as a “watch-dog” to control industrial activities.
ISO
A voluntary scheme for company’s environmental management system.
A commitment to improve environmental performance of companies.
ISO does not reflect a real companies’ environmental performance
Public Disclosure system (PROPER)
An instrument to improve industries’ environmental performance through information dissemination to public.

6. Distribution of Industries
Paper
Textile
Rayon
Mining
Automotive
Cement
Petrol Chemical
MSG
Consumer goods
Fertilizer
Pharmacy
Electronic
Chemical Industry
Food & Drink
Electro Plating
Sugar
Leather Tanneries
Lubricating Oil
Basic Chemical
Iron & Steel Smelting Industry
Petroleum Refined
Recycling
Cigarettes
Pulp & Paper
Crumb Rubber
Crude Palm Oil
Coal Mining
Sugar
Tapioca
Petroleum Refined
Cement
Fertilizer
Crumb Rubber
Coal Mining
Petroleum Refined
Plywood
Adhesive
Gold Mining
Ferro Nickel
Copper
Cement
Gold Mining
Ferro Nickel
Copper

7. ?
What is PROPER
PROPER (Program for Pollution Control, Evaluation and Rating) is an alternative instrument to control pollution based on sustainable development principle through environmental compliance and performance of companies’ improvement in environmental management through the introducing disincentive and incentive reputation by disclosing environmental performance of industries to public and stakeholders.

8. PROPER RATING SYSTEM 2002 GOLD GREEN BLUE RED BLACK
Pollution level 5% of the legal standards and near zero emissions level
PROPER rating system consists of five colors designed to represent the entire spectrum of environmental performance.
Ratings are based on performance in all aspects of environmental management within and outside a company
Unlike PROPER 1995, PROPER 2003 methodology includes water, air and hazardous waste and other factors.
GOLD
Better than legal standards by 50%, uses clean technology, waste minimization, pollution prevention, and resource conservation
GREEN
BLUE
Efforts meet minimum legal standards
RED
Efforts don’t meet standards
No pollution control effort,
Serious environmental damages
BLACK

9. National Environmental Act Mandates Information Dissemination to the Public
Environmental Management Compliance Monitoring
Companies’ obligation for information dissemination
Community Right for participation in environmental management
Right on environmental information
KEY WORDS
ActNo. 23/1997 Article 22 (1)
Act No. 23/1997 Article 5 (2)
Act No. 23/1997 Article 5 (3)
Act No. 23/1997 Article 7 (1)
Act No. 23/1997 Article 6 (1)

10. PROPER’s Core Strategy-Strengthen Environmental Politics
How to create public demand for cleaner environment? Empower external stakeholders
Public Disclosure
NGOs
Communities
Media
Business
Local Govt.
Empower NGOs with superior information
Legitimize public perception about env. issues
Promote social responsibility & educational journalism
Establish credibility and strategic alliance
Recognize and reward high performance local agencies

11. Rating Methodology : RATING ISSUES
Environmental ratings are based on performance in seven areas:
Compliance with water pollution regulations
Compliance with air pollution regulations
Compliance with hazardous waste management regulations
Compliance with AMDAL (EIA requirements)
Quality of environmental management system
Resource management and use
Community development and relationship

12. PROPER’S 4 PRINCIPLES FAIRNESS ACCOUNTABLE PUBLIC PARTICIPATION
TRANSPARENCY

13. Qualitative Information
Rating Analysis
Qualitative Information
Quantitative Analysis
Visual Analysis

14. New Implementation Approach: Strong Local Participation
Involvement of Provincial and District/City level
Regular Monitoring
Sampling
Evaluation
Database system

15. PROPER Supports Strategic Policy Analysis
Sector Benchmarking
Province Level Benchmarking
Analysis of Key Performance Weaknesses
Set National Targets

16. COMMUNICATION STRATEGY
Disclosure of companies’ rating :
Press Conference
Information of the PROPER :
Booklet
Leaflet
Socialization to local governments and industries

17. PROPER 60 51 50 40 33 30 32
NUMBER OF INDUSTRIES 30 25 23 20 20 14 8 8 8 10 3
2002
2003
2004
Black
Red
Blue
Green
Gold

18. Administration cost of programsNo
Litigation *)
PROPER **)
Description
US$
Description
US$ 1 2 3 4 5 6 7
Surveillance
Investigation
Legal brief
Trial
Appeal to high court
Appeal to supreme court
4,000
8,000
2,800
11,000
Inspection and laboratories analysis
Coordination meeting
Dewan PROPER
Peer Review
Press briefing
38,000
5,600
1,100
5,500
TOTAL
31,400/ case
61,400 / 43 industries
= US$ 2,362/industry
*) Cost needed for litigation for an environmental pollution case
**) Cost needed for PROPER to evaluate 43 manufacture industries

19. ADMINISTRATION COST
Budget of US$ 31,400 must be provided in order to resolve an environmental case, not to mention the long period of time to go through.
Cost needed by PROPER to increase the environmental performance of one industry is approximately US$ 2,362 (60% of 43 manufacture industries has improved its performance).

20. Compliance cost
Pollution control equipment investment from a pulp and paper industry
Wastewater
US$ 5.0 million
Air emission
(Continuous Emission Monitoring)
US$ 0.6 million
Solid waste
(landfill and remediation)
US$ 5.6 million
TOTAL
US$ 11.2 million

21. Limitation
PROPER is only effective for large scale companies because they are concern with the image to market.
PROPER cannot apply to all scale of industries.

22. SUMMARY
Based on administration cost approach, PROPER is a more effective program to be carried out compared to litigation.
PROPER is especially effective for large scale industries.
PROPER is a complementary instrument in controlling pollution to other environmental law enforcement programs.
Indonesia still needs strong environmental agencies.