p–ISSN: 2723 - 6609 e-ISSN: 2745-5254

Vol. 5, No. 10, October 2024 http://jist.publikasiindonesia.id/

Indonesian Journal of Social Technology, Vol. 5, No. 10, October 2024 3915

Legal Obligations of Mining Companies in the

Implementation of CSR Based on Laws and Regulations

KMS Herman

1*

, Badrunsyah

2

ABSTRACT

Keywords: legal

obligations, mining

companies, corporate

social responsibility.

oil and gas, metals, rocks, clay, sand, salt, minerals, chemicals, fertilizers, as well as

gypsum, asphalt, and limestone. This activity is an effort to explore and produce raw

materials that can be processed into added value for the company, attracting investment

from investors to obtain maximum profits. (Rutin et al., 2019). The mining sector is

important in Indonesia because of its contribution as the main source of state income,

which attracts investors' interest in investing. (Midesia, 2020). Indonesia's Gross

Domestic Product (GDP) has now reached IDR 19,700 trillion, with most of it coming

result in ecosystem damage, such as deforestation, destruction of wildlife habitat, and

land and water degradation. In addition, the social impacts of mining activities include

conflicts with local communities regarding land rights, increased uncontrolled migration,

and public health problems due to air and water pollution. Therefore, mining companies

need to implement socially and environmentally responsible practices or Corporate Social

Responsibility to reduce these negative impacts.

responsibility for social and environmental impacts arising from their business

operations, such as pollution, waste, and product safety issues. (Sekarwigati & Effendi,

2019). The Indonesian government has regulated the implementation of social

and environmental responsibility (CSR) in Indonesia is governed by several laws, namely

Law Number 40 of 2007 concerning Limited Liability Companies, Law Number 25 of

2007 concerning Capital Investment, and Law Number 19 of 2003 concerning State-

Owned Enterprises (BUMN). These regulations reveal inconsistencies in CSR

governance, leading to subsequent refinements in regulatory frameworks. Private

companies and BUMNs are mandated to adhere to CSR practices outlined in these laws,

despite the absence of explicit sanctions in the Capital Investment Law and State-Owned

Enterprises Law.

behind making CSR a legal obligation includes Indonesia's sovereignty to regulate

in the relationship between companies, government, and local communities. This research

aims to analyze the legal obligations of mining companies in implementing CSR based

on statutory regulations.

This study employs qualitative research methods using a normative and empirical

legal study approach. Qualitative research is utilized to investigate natural object

conditions, with the researcher acting as the primary instrument. Unlike quantitative

collection technique employed is a literature review, aimed at gaining a comprehensive

understanding of previously studied issues, related theories, existing findings, and recent

developments within the chosen field of study. Data were sourced from Google Scholar,

covering publications from 2014 to 2024. The case study focuses on PT Bengalon

Limestone in Selangkau Village, Kaliorang District, East Kutai Regency, East

Kalimantan Province (Limestone Mining). Collected data are analyzed through three

stages: data reduction, data presentation, and conclusion.

resources in the form of limestone, which is utilized by PT Bengalon Limestone to

conduct exploration. The abundance of natural resources can encourage the opening of

opportunities for companies to conduct exploration and mining, supporting further

economic development.

so it is no surprise that mining is one of the human activities with significant

environmental and social impacts. Mining activities are varied and can leave different

ecological footprints. These activities have caused environmental damage that is still

visible today. (Carvalho, 2017). During exploration, mining companies often damage the

surrounding natural environment. The worsening environmental crisis has increased

feels that the company does not pay attention to social and environmental aspects and

does not make a positive contribution, even causing negative impacts, this can cause

resistance or social turmoil. The company's commitment to contribute to the nation's

development by paying attention to financial, social, and environmental aspects is

referred to as corporate social responsibility (CSR) (Martin et al., 2017).

regarding economic and human values. Then, it emphasizes that to a certain extent,

corporate social responsibility (CSR) can contribute to the economic benefits of the

reduced. This confirms that companies, especially mining companies such as PT

Bengalon Limestone, must implement social responsibility and maintain social power in

the eyes of society.

is defined as the commitment of companies or the business world to contribute to

sustainable economic development by paying attention to corporate social responsibility.

CSR emphasizes the importance of balance between attention to economic, social, and

environmental aspects. Meanwhile, according to Jhonatan Sofian in (Martin et al., 2017),

CSR is a concept that requires companies to fulfill and pay attention to the interests of

stakeholders in their operations for profit. Stakeholders include employees, customers,

mining companies to implement CSR is regulated in several laws and regulations. For

example, the following laws and regulations:

1. Law Number 40 of 2007 concerning Limited Liability Companies (PT Law).

obliged to carry out social and environmental responsibilities. If not carried out, the

company will be subject to sanctions by the provisions of laws and regulations.

2. Law Number 25 Year 2007 on Capital Investment (PM Law).

environmental responsibility. Social and environmental responsibility must be

implemented by applicable legal norms and the values and culture of the local

infrastructure, improving the quality of education and public health, developing small and

medium enterprises, and preserving the environment.

4. Government Regulation No. 47/2012 on Social and Environmental Responsibility of

Limited Liability Companies (PP 47/2012).

responsibility. The Explanation of Article 2 states that every company, as a form of

5. Government Regulation Number 23 of 2010 concerning the Implementation of

Mineral and Coal Mining Business Activities (PP 23/2010), as last amended by PP

8/2018.

develop a community development and empowerment program around WIUP (Mining

Business License Area) and WIUPK (Special Mining Business License Area). This

program must be consulted with the central government, provincial government,

regency/city government, and local communities. Then, the community can propose a

community development and empowerment program to the local regent/mayor to be

forwarded to the IUP or IUPK holder. Furthermore, CSR must be prioritized for

has complied with various laws and government regulations governing corporate social

and environmental obligations. In addition, the company also helps to create harmonious

relationships with the community and the surrounding environment and contributes to

sustainable development.

obligation to implement CSR with several concrete steps. First, the company must

implement a Community Development and Empowerment Program. Development refers

to efforts to improve the knowledge and skills of the community so that socio-economic

conditions improve. The expected outcome of this program is the realization of

independence in the lives of the empowered community. This means that the communities

Decree No. 1824 of 2018. This Decree requires companies holding mining IUPs to carry

out community development and empowerment (CPD) which includes eight main

programs. These programs include:

1. Education, including providing scholarships, education, basic skills and expertise

training, educator assistance, educational facilities and/or infrastructure assistance, as

well as training and community independence.

fisheries, and entrepreneurship, and prioritizing the use of labor from communities

around the mine according to their competencies.

4. Economic independence, through increasing the capacity and access of local

communities in small and medium enterprises, developing small and medium

enterprises of communities around the mine, and providing opportunities for

communities around the mine to participate in the development of small and medium

enterprises according to their profession.

5. Social and cultural, such as assistance in the construction of worship facilities and/or

infrastructure and relationships in the religious field, natural disaster assistance, and

participation in the preservation of local culture and local wisdom.

in the area is still inadequate. Infrastructure itself is a physical system required to fulfill

basic human needs in a social and economic context. Road infrastructure development is

very important because good roads are needed to facilitate mobility from one place to

another for the benefit of the surrounding community. The existence of well-lit roads and

easy-to-reach access will make it easier for people to carry out various activities,

especially in terms of economic exchange from one place to another. (Ompusunggu,

2018).

infrastructure which includes improving the quality of education and public health. The

company is also required to develop small and medium enterprises and preserve the

CSR activities carried out to fulfill various community needs holistically and sustainably.

carried out by applicable legal provisions, as well as considering the values and culture

of the local community. The implementation of CSR must also be based on the principles

of accountability and transparency so that all activities and programs can be accounted

for and carried out with openness. Finally, social and environmental responsibility must

PT Law and PP 47/2012, companies that do not carry out their social and environmental

responsibilities may be subject to sanctions by the provisions of the relevant laws and

regulations. As PT Bengalon Limestone is engaged in the mining sector, the regulation in

question is PP 23/2010 and its amendments. For mining companies that do not carry out

their social and environmental responsibility obligations, the administrative sanctions that

can be imposed include:

1. Written warning

2. Temporary suspension of IUP Production Operation or IUPK Production Operation of

mineral or coal

3. Revocation of IUP or IUPK

result in significant benefits for both the local community and the company itself. One of

the main benefits of CSR is improving community welfare (Deigh et al., 2016). With

efforts such as education, health, and support for small businesses, the company can

improve the quality of human resources in the village. This means that the company is

helping to improve the community's access to quality education, and adequate health

services, as well as opportunities to develop their businesses.

resources in the village, PT Bengalon Limestone will also help preserve the existing

environment and natural resources. (Nassani et al., 2022). This effort is important to

ensure that mining activities are not only economically impactful but also

strong impetus for PT Bengalon Limestone to implement CSR as part of its legal

obligations. It also reflects the company's commitment to not only seek economic profit

but also make a sustainable positive contribution to the surrounding community and

environment.

Limestone is required to build and maintain public facilities and infrastructure which

includes improving the quality of infrastructure, education, and public health. Corporate

social and environmental responsibility must be carried out by applicable legal

provisions, including Law Number 40 of 2007 concerning Limited Liability Companies

(UU PT), Law Number 25 of 2007 concerning Capital Investment (UU PM), Law

Number 4 of 2009 concerning Mineral and Coal Mining (UU Minerba), Government

Regulation Number 47 of 2012 concerning Social and Environmental Responsibility of

Limited Liability Companies (PP 47/2012), and Government Regulation Number 23 of

2010 concerning Implementation of Mineral and Coal Mining Business Activities ( PP

23/2010), as last amended by PP 8/2018.

Ompusunggu, V. M. (2018). Dampak Pembangunan Infrastruktur Jalan Terhadap