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Validation Page (ISBN)

Building Today for Tomorrow

Advisor:Elim Sritaba

Authors:Juniati GunawanHandoko

Editor:Putri Hardianti, Librian Angraeni, Luluk Andriyani, Oktavia Ratnasari

Layout & Design:Kevin Andrean, Ricky Andrianus

Original EditionCopyright@2017: Asia Pulp & PaperEmail: [email protected]: www.asiapulppaper.com

Publisher : PT Mitra Wacana MediaEmail : [email protected] : http//www.mitrawacanamedia.com

CONTENT

Asia Pulp & Paper:Building Today For Tomorrow02

06

08

20

34

Tjiwi Kimia:Clean Water For Life

Indah Kiat Serang:Education For Future Generation

Indah Kiat Perawang:Empowerment of Siak Riverside Community

Statement

Rombong Biru EmpowermentIncreasing Farmers’ Harvest HIV/AIDS Prevention and HandlingStudying at Learning CentrePaving Block Installation for SchoolsClean Water Facility Construction

091113141718

2224252627293032

353638404244454647

Making School FurnitureBuilding School TogetherNational Movement of Foster Parents (GNOTA) Scholarships Creating Art WorksDeveloping PosyanduIncreasing Access to Clean Water Improving IrrigationMangrove Planting

Abdul Wahid Learning CentreAbdul Wahid Micro Finance Institution Skill Training at Craft CentreIntegrated Farming DevelopmentStrapping Band Craft ArtisansHealth Services on Floating ClinicTourist Village DevelopmentStudent of Higher Education Development Building Access to Clean Water

ASIA PULP AND PAPERCorporate Social Responsibility

4

ASIA PULP & PAPER:BUILDING TODAY FOR TOMORROW

Asia Pulp & Paper Group (APP) is one of the world’s largest pulp and paper producer groups. Starting with Tjiwi Kimia, which has produced caustic soda in 1972, APP now produces a wide range of paper products with a capacity of over 19 million tonnes per year, and sells its products in more than 120 countries on six continents. Currently, APP has 11 factories across regions in Indonesia.

In line with its sustainability roadmap launched in 2012, APP continues to implement its commitments to improving environmental performance, conserving biodiversity, and protecting human rights. This commitment carries us through 2020, at which point the entire APP business chain will have certification for Sustainable Forest Management (SFM) in line with global best practices.

Since 2015, APP has made substantial progress towards its Vision 2020, in building a sustainable roadmap and implementing forest conservation policies. There have been key achievements in three areas, i.e. the introduction of the integrated forest and farming system programme, advancement in best practices of peatland management program, and implementation of the integrated sustainable forest management plans. In addition to environmental achievements, APP has also continued to carry out social activities to improve the community’s welfare, especially those living in the vicinity of the mills’ area.

To achieve sustainable positive benefits, APP carries out community empowerment activities that refer to the achievement of Development Goals (SDGs). The achievements of SDGs are inter-connected with the sustainability context of APP. SDGs are a world development framework containing 17 goals with 169 measurable achievements and deadlines established by the United Nations.

APP Mills in Indonesia

Pindo Deli Perawang

Pindo Deli Karawang

Tjiwi Kimia

UnivenusPerawang

OKI Mill

Indah Kiat Perawang

Indah Kiat Tangerang

Headquarter Jakarta

Indah Kiat Serang

Lontar Papyrus

Eka Mas Fortuna

APP MILLS


5


6

Increased access to and quality of education

Improved access and quality of clean water, and sanitation

Infrastructure development

APP’s steps in realizing community welfare that are in line with the SDGs include:

Economic empowerment and poverty alleviation

Health promotion

Environmental preservation

These activities are conducted by all of APP’s mills through community empowerment programs as part of corporate social and environmental responsibility activities. Empowerment activities are jointly conducted with communities, partners and local governments as a form of stakeholder active engagement.

At Pindo Deli Mill, Karawang, for example, farmers’ development activities have helped the local community to earn extra income. Farmers utilise the 25 hectare-land owned by Pindo Deli to grow various types of crops such as eggplant, cauliflower, chili, bitter melon, cucumber and long beans. The land was originally used to grow rice. However, farmers consider cultivating non-rice food crops is more profitable although there should be regular gardening than planting rice.

Meanwhile, the activities at Lontar Papyrus Mill, Jambi, saw problems related to water conditions in the neighboring villages. Because of this, Lontar Papyrus Mill implemented a clean water program for the communities around the mill, in the form of a water pipeline and drinking water refill program. This is also in line with APP Sinar Mas’s commitment after joining UN CEO Water Mandate since 2011, to continue to provide clean water facilities for the community.

At Ekamas Fortuna Mill, Malang, the company built Ekamas Learning Centre to support the education of children around the mill. The available facilities include a reading centre, computer centre, play centre, and hall. This learning centre is frequented by about 25 visitors every day.

Y


7

Community empowerment programmes to improve welfare are also conducted at Indah Kiat Mill, Tangerang. At the mill’s locality, APP provides assistance in catfish farming. There are two groups receiving the assistance, the Karang Taruna youth group of Pakualam Village and Business Group of Pakulonan Sub-district. This assistance is conducted in collaboration with South Tangerang Fisheries Agency.

Meanwhile, OKI mill is also involved in development, especially in the education in Ogan Komering Ilir (OKI) Regency. Education is one of the prioritized development sectors in OKI Regency development in South Sumatera Province. This program is named “1 Village 1 PAUD Program,” with the objective of increasing the quality of children’s education. To further support education, OKI mill helps to build the PAUD buildings and facilities. The OKI mill has committed to help build 60 PAUD buildings in villages around the OKI regency.

In general, APP community empowerment activities are intended for residents located in areas close to the mill. These communities are important because their existence becomes an integral part of the existence of each APP Mill. The strategies in reducing negative impacts and maximizing the positive impact of the mill’s existence are immediately felt by the local communities. This is in line with Kytle, Beth and Ruggie (2005) which states that community empowerment is essentially conducted to reduce social risks.

Community empowerment activities undertaken by APP include social aspects, such as education; economic aspects that focus on welfare improvement; and environmental aspects through natural conservation. These three aspects are an integral part that support sustainable community empowerment (Roseland, 2000). Furthermore, APP attempts to create sustainability values that are in line with the achievement of a ‘holistic’ sustainable business model. The link between creating sustainability value for the company and the community will be the foundation for creating harmonious relations between APP and all stakeholders.

This community empowerment book is prepared by presenting the performance of Indah Kiat Perawang and Serang mills, as well as Tjiwi Kimia mill in East Java. These mills have been conducting many activities in community empowerment and have brought positive impacts to local communities. The performance of these three mills is expected to be a reference for community empowerment activities in other mills or companies. The activities from other mills will be periodically presented as part of the evaluation and delivery of information to all APP’s stakeholders.


8

In 2012 APP launched Sustainability Roadmap-Vision 2020, consisting of a commitment to continuously improve our performance in 11 areas of sustainability impact in all business lines to contribute to reducing the impact of climate change.

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9

Asia Pulp & Paper Group (APP) has become one of the largest groups in the paper industry in both Indonesia and the world. Our role as a key player in the industry encourages us to continue our work for stakeholders, especially for communities surrounding APP mills across Indonesia.

As part of our commitment to running a sustainable and responsible corporate operation, in 2012 APP launched Sustainability Roadmap-Vision 2020, consisting of a commitment to continuously improve our performance in 11 areas of sustainability impact in all business lines to contribute to reducing the impact of climate change. The areas include: responsible supply of raw materials, conservation of forest and biodiversity, reduction of energy and water consumption, reduction of emissions and waste, improving employee welfare, empowering local communities, and respecting human rights and the rights of indigenous peoples in particular.

We also carry out Our Vision 2020 series through community development (comdev) activities. Along with the implementation of Sustainable Development Objectives (SDGs), empowerment activities aim to improve the quality of life and the creation of community independence. The empowerment activities are implemented by engaging all stakeholders, especially the communities around us. We believe this engagement will create sustainability.

Through this book, we would like to deliver information on community empowerment activities carried out in three APP mills, namely Tjiwi Kimia in Mojokerto, East Java; Indah Kiat Serang in Serang Regency, Banten; and Indah Kiat Perawang in Siak Regency, Riau. The delivery of this information is a means of sharing updates with stakeholders, as well as evaluation of our performance.

Empowerment activities aim to improve the welfare and quality of life of the community around the mills. These activities are adjusted to the needs of the community and identify local potentials so that the results can have positive impacts on improving the quality of life, education, access to clean water and sanitation, and environmental preservation.

We would to thank all the stakeholders who have supported us. Let us continue to work closer together by building today for tomorrow.

STATEMENT

Elim Sritaba

Jakarta, October 2017

Director of Sustainability and Stakeholder Engagement


10

TJIWI KIMIA: CLEAN WATER FOR LIFE

PT Pabrik Kertas Tjiwi Kimia Tbk (Tjiwi Kimia) is the largest paper mill in East Java located on Surabaya - Mojokerto highway, Kramat Temenggung village, Tarik District, Sidoarjo Regency.

A total of four neighboring villages are directly affected by Tjiwi Kimia’s activities; Kramat Temenggung, Mliriprowo, Sebani, and Kedung Bocok villages. The majority of villagers work at Tjiwi Kimia that indicate that they rely their economy on the industrial sector. In addition, many of them also work as farmers as shown by the large numbers of the land are rice fields. Geographical conditions that have a tropical climate and wetlands that are higher than the rivers/streams often cause the farmers to fail to reach maximum results of crops due to difficulties in obtaining water. Therefore, one of Tjiwi Kimia’s programs to support the community’s farming program is by making wells for irrigation.

Since its establishment, Tjiwi Kimia has evolved into one of the world’s largest paper manufacturing and paper derivative products. This achievement strengthens Tjiwi Kimia’s commitment to continuously improve harmonious relations with all stakeholders.

Through the end of 2016, several main community empowerment programs have given positive impacts on the community’s welfare. These activities also created a harmonious relationship between the company and local communities, and supported the achievement of sustainable development goals, among others:

Health Sector: anti-drug and HIV/AIDS campaign, family planning campaign, regular blood donation, and social service of cataract and cleft lip surgery.

Education Sector: scholarships at the Academy of Pulp and Paper Technology (ATPK) in Bandung, the establishment of learning centres and support for school quality improvement.

Water Supply and Sanitation: water supply for the community

Economic Sector: farmer assistance, empowerment of rombong biru in the environment of Tjiwi Kimia

Community Empowerment


11

Rombong Biru program was first implemented in 2004 involving 25 food hawkers who were residents of the mills’ surrounding areas. This program was created because of the unorganized hawkers selling inside the mill.

This disorder created problems, including: • The presence of hawkers in the mill’s area is highly

dangerous for their safety, some of them even sneaked illegally into the mill’s site riding a truck and container.

• The presence of hawkers triggered various social and environmental problems, such as waste, and unhealthy competition among the hawkers.

Various efforts had been made to curb the hawkers, but were unsuccessful. The hawkers needed a source of income to meet their daily needs, and the employees also needed the hawkers for their food options.

ROMBONG BIRU EMPOWERMENT

Aware of this opportunity to share a sustainable value between the company and the surrounding community, Tjiwi Kimia set up a program called the Rombong Biru (Blue Hawker Cart) Program. It was named after the blue hawker carts used by the hawkers.

Through this program, the hawkers were trained in food hygiene and health, as well as culinary knowledge. They were also provided with blue uniforms, a special identity card, and blue hawker carts to sell their fare.

Facilitated by Tjiwi Kimia, the hawkers were divided by zones so they no longer need to race to get a spot. After zoning was established, the hawkers who now in appeared all blue were allowed to sell in the mill’s area during lunch break.

Y


12

The average income of the rombong biru vendors reached Rp2,500,000 monthly, or exceeded the minimum wage of East Java province in 2004 of Rp310,000. From the sales, one of the vendors named Sumaji, a resident of Pajar Selatan Village, Tarik District, who became the head of the Rombong Biru hawker association, managed to own a food stall. Another hawker, Parmi who is the only woman, even managed to go on hajj pilgrimage in 2015 from her sales income.

In addition to benefits received by the hawkers, Tjiwi Kimia’s employees also feel safer in buying food because it is more hygienic and healthy. The organized sales hours have made it easier for employees to buy food without disturbing working hours. The interaction between hawkers and employees is established, creating a synergy of sustainability value and strengthening good relations between the company and the local community.

Comparison of Benefits as Rombong Biru Vendors

Profile of Rombong Biru Hawkers Based on Origin, Gender and Age in 2015

Condition

Origin

Before Becoming Rombong Biru

Gender Age Group

< 40 41 - 50 > 51 TotalMale Female Total

After Becoming Rombong Biru

Way of selling

Appearance

Place to put merchandise

Location trading

Ways to cook and process food

Turnover

Tarik, Sidoarjo

Bendo, Sidoarjo

Jetis, Mojokerto

Bangsal, Mojokerto

Mojoanyar, Mojokerto

Had no access to the mill during breaks

According to each of their taste and needs

Baskets according to their respective need

Chaotic, which often caused conflict with other hawkers

Lack of attention to hygiene and health

40 packs

11

1

3

1

1

1

0

0

0

0

2

0

0

0

0

6

0

1

1

0

4

1

2

0

1

12

1

3

1

1

12

1

3

1

1

Given access to the mill during breaks

Blue uniform with a special identification

Rombong (hawker cart) with similar design in blue color and more hygienic

Zoning, with each hawker occupies a specific location within the mill area

More controlled hygiene and health

60 packs


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INCREASING FARMERS’ HARVEST

Sidoarjo, especially in Tarik area, is known as the fertile area. Situated on the banks of Brantas River, making Tarik as the rice production center of East Java Province and therefore, farming is the mainstay of livelihood for its residents.

However, not all paddy fields in Sidoarjo can be irrigated from the existing rivers. This condition has been faced by farmers in Bogem Pinggir Hamlet, Bogem Village, Balung Benda District, which is located 6 km away from Tjiwi Kimia Mill. Difficulty of water in Bogem Pinggir Hamlet occurred because of its location is higher than Kalimas River and Mangetan Kanal River.

Recognizing the need and potential of farmers to increase crop yields, Tjiwi Kimia cooperated with farmers’ groups and local government, building water wells to produce water for irrigating paddy fields. The farmers’ welfare is of concern to Tjiwi Kimia because their existence as rice producers is part of the strategy of maintaining national food security. Moreover, the Food Security Agency affirms its vision to improve the quality of local resources to achieve food sovereignty and independence.

Therefore, in 2012, Tjiwi Kimia made water wells on three spots at the outskirt of the hamlet. In addition, it also provided assistance of three medium-sized pumps. Water from the wells is lifted by the pumps and distributed to the farmers’ paddy fields, one of them is Loh Jinawi farmers’ group which has the most members of 30 farmers. The total area of irrigated paddy fields reached 45 hectares.

To ensure the farming sustainability, the participatory elements of each activity are continuously improved. Each farmers’ group has a responsibility to properly maintain and use the pumps. They also save funds through a Rp15,000 annual contribution to cover pump operating costs. Given this responsibility, the use of pumps can be optimized and every farmer has the sense of belonging. A communal sense of gotong-royong can also be cultivated, which ultimately will result in maximum benefit and sustainable program.

Water Needs for Farmers

Before water wells and water pumps were provided, with only one rice harvest, an average of five tons of dried grain per hectare, the gross income was Rp19 - 20 million. When calculated on average per month, then for every growing season, a farmer earned only about Rp1,600,000. This output was insufficient for the living cost of Rp3,040,000 per month, according to minimum wage set by the local government in 2016.

Now, since the water wells and water pumps were provided, farmers in Bogem Pinggir hamlet can harvest rice twice a year which increases their income to about Rp2,300,000. The better income has made some farmers able to buy and have their own water pumps. They attempted to reproduce aretsian wells so there is no need to take turns to irrigate the paddy fields.

Now Rice is Harvested Twice

Comparison of Benefits of Water well and Water Pump Assistance

DescriptionBefore After

Receiving Assistance From Tjiwi Kimia

Water sources

Growing seasonwithin a year:

Cropping pattern

Rice production at every harvest

Income of farmers(tillers)

Pumpownership

Rainwater

Rice - Rice Crops

4-5 tonsper hectare

On average of Rp1.5 million - Rp2 million per month, for one rice planting period in 4 months

No one has a pump yet Some have their own pumps

On average of Rp2 million - Rp2.5 million per month, for two periods of rice planting in 8 months

5-6 tonsper hectare

Rice - Rice Crops - Rice

Rainwater and water wells

Rice RiceRice Crops Rice Crops

Y


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HIV/AIDS PREVENTION AND HANDLING

The enactment of Manpower and Transmigration Ministerial Decree No.68/MEN/IV/2004 on the HIV/AIDS Prevention and Handling in the Workplace, is the reason for the involvement of PT Pabrik Kertas Tjiwi Kimia Tbk in handlingling HIV/AIDS. From the dissemination material provided by East Java’s Manpower and Transmigration Agency to all trade unions of companies in East Java, Tjiwi Kimia publishes articles on the company’s internal bulletin. The articles received the attention of Yayasan Mulia Abadi or YMA, a non-governmental organization concerned with dissemination of HIV/AIDS prevention.

This was the beginning of the collaboration between Tjiwi Kimia and YMA in providing dissemination of HIV/AIDS handling in the workplace. This dissemination is very important considering until the end of 2015, East Java statistically ranked the 2nd highest number of HIV/AIDS cases and was continuing to rise. The issue cannot be overlooked, and Tjiwi Kimia strongly supported government programmes to save the new generation as the future of the nation.

Thus, since 2005, YMA has invited trade unions to work together in building a pilot project for HIV/AIDS prevention in the workplace at Tjiwi Kimia. Post-training, dissemination of HIV/AIDS handling has been increasingly massive.

HIV/AIDS handling remains a concern to Tjiwi Kimia, in line with the enactment of East Java Provincial Government Regulation No. 5 of 2004 and East Java Governor’s Decree No.54 of 2004 on HIV/AIDS Prevention and Handling in the Workplace. Another consideration is the location of Tjiwi Kimia and employees’ residences in the areas of Mojokerto, Sidoarjo and Surabaya are demographically in the red area with high prevalence of HIV/AIDS.

Prevention and handling of HIV/AIDS in the workplace are also conducted along with the determination to realize the employee welfare as stated in the Sustainability Roadmap Vision 2020. Hopefully, if the awareness to maintain health through HIV/AIDS handling is successful, then not only employees, but the company’s partners will be healthier. Health is crucial for improvement of performance and productivity, and a healthy working environment is also a goal of sustainable development.

High Prevalence Area

The commitment to eradicate HIV/AIDS at Tjiwi Kimia Mill is implemented through:1. Issuance of a Management Decree on HIV/AIDS in the

Workplace Policy. 2. Include a clause on HIV/AIDS in Collective Labor

Agreement (CLA).3. Management involvement in campaigns on HIV/AIDS.4. Establishment of Indonesia Business Coalition on AIDS

(IBCA) within Sinar Mas Group affiliated with Asia Pacific Coalition on AIDS (APCA).

5. Formation of Tjiwi Kimia Care on HIV/AIDS & Drugs Task Force.

In 2006, Tjiwi Kimia has adopted all HIV/AIDS handling in the workplace programs and until the end of 2016, some of the achievements of the HIV/AIDS program dissemination, included: 1. Dissemination on HIV/AIDS risk for Tjiwi Kimia

employees has covered 80% of total employees, which is about 10,000 employees.

2. Campaign and sharing of HIV/AIDS programs for all sister companies of APP Group and other companies in Sidoarjo Regency.

3. Participation in various exhibitions, printing and distribution of more than 150,000 pieces of brochures, leaflets and stickers on the dangers of HIV/AIDS for companies and the general public.

Due to the performances above, Tjiwi Kimia Earning various awards, including Best Program for Contagious Disease & HIV AIDS prevention and handling for Private Companies Sector from the Office of Special Envoy of the President of the Republic of Indonesia and the HIV/AIDS & OHSMS in the workplace Award from Minister of Manpower and Transmigration in 2014.


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Dissemination of HIV/AIDS

Control to Schools

Recognizing the importance of raising awareness of HIV/AIDS early on, Tjiwi Kimia has also established HIV/AIDS prevention and handling dissemination units in high schools by working together with Regional Health Agency, Regional Education Agency and Regional AIDS Eradication Commission (KPAD). This has remained a challenge because of several obstacles, including:1. Lack of knowledge of students, teenagers and youth

about the importance of maintaining the health of reproductive organ.

2. Limited number of educators who have HIV/AIDS knowledge.

3. Lack of awareness of HIV/AIDS issues and support from parents. Some of them still consider it is a taboo to talk about HIVAIDS.

4. Rampant drug circulation and abuse.

Various strategic steps have also been taken made by Tjiwi Kimia to optimize HIV/AIDS prevention in schools, including:1. Provide training and guidance for the group as a peer

educator in schools, so they can become a motor for their fellow students.

2. Provide support in the form of campaign materials such as posters, leaflets and brochures for the dissemination of HIV/AIDS prevention and handling for schools.

One of the schools that has been able to raise awareness to participate in HIV/AIDS prevention and handling in Mojokerto City is SMK PGRI Sooko vocational school, since 2007. This program continues with the establishment of Centre for Information and Counseling of Adolescent Reproductive Health (PIK-KRR). With this awareness, SMK PGRI Sooko won the PIK-KRR competition in East Java Province in 2012 and the national PIK-KRR champion in 2014. Hopefully, PIK-R SMK PGRI Sooko can be a national model and an example for many schools in East Java and other regions in Indonesia.

STUDYING AT LEARNING CENTRE

Education has been a major focus for Tjiwi Kimia, especially education for children at an early age. Education awareness is also a manifestation of the company’s support to the achievement of the National Medium Term Development Plan (RPJMN) 2015-2019 and the Government’s work plan, through the Ministry of Education and Culture. Education has also become one of the sectors in the partnership program activities launched by the Ministry of State-Owned Enterprises (SOEs).

The importance of education is the foundation for community development, one of which can be achieved by raising the reading interest. However, the lack of facilities for learning and reading became an obstacle for residents in Mojokerto area. Therefore, in 2008, Tjiwi Kimia built the first Learning Centre (Rumah Pintar) in Banjar Agung Village, Puri District, Mojokerto City. The move was supported by the local government, which by 2016 has seen the development of three learning centres.

The learning centres have various interesting activities for children to visit and learn. Complete reference books are available in reading centres, a variety of educational games at the computer centre, the availability of movies at the audio-visual centre, as well as various play facilities at the play and craft centres. Learning English, Mandarin, music and drawing are also available at the Learning Centre. All facilities are accessible to children and adults, free of charge.

Learning Centre Location and Members

2008

2012

2015Banjar Agung Village, Puri District, Mojokerto CityTotal Members : 165

Suwaluh Village, Balang Bendo District, Mojokerto CityTotal Members : 201

Tarik Village, Tarik District, Sidoarjo RegencyTotal Members : 101

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Most visitors of the learning centres are residents around the location, approximately 50-100 people daily. In general, visitors to the learning centres are children and teenagers, with the age range 4 to 17 years old. Other visitors are adults who generally are housewives who want to read or learn about handicrafts.

In addition to individuals, the learning centres are frequented by students of schools around the location of the centres. Starting from playgroup and early childhood education (PAUD), kindergarten, elementary school (SD) and Islamic elementary school (Madrasah Ibtidaiyah/MI), up to junior high school and senior high school.

Learning Centre Visitors

Average Number of Visits per Day

55

60

30

30

25

15

Learning Centre I Banjar Agung Village, Puri District, Mojokerto City

Learning Centre II Tarik Village, Tarik District, Sidoarjo Regency

Learning Centre III, Learning Centre Kolonel Sampoerna, Padi Village, Gondang District, Mojokerto

Children and teenagers

Housewives

Average Number of Visitors per Day (Monday – Friday)

Learning Centre’s benefits for children:a. Experience the optimal learning environment, which

can enhance psychophysical development, and improve the socialization of children.

b. Receive beneficial free training/courses.c. Utilize existing facilities to develop creativity and positive

behavior.

Learning Centre’s benefits for adults: a. Learn to make handicraft at the craft centre, which can

be sold and earn extra income for the family.b. Broaden the horizon and knowledge through the provision

of a special space for reading newspapers, magazines and other reading materials.

c. Access to computer learning that can be done in the morning while waiting for the children to come home from school and come to the learning centre.


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The benefit of laying the paving blocks is the schoolyard no longer inundated. Since the installation of paving blocks children can do their activities and play outside the classroom more comfortably and safely. In addition, it also improves the health of those in the school because they can regularly do morning exercises in the schoolyard comfortably without thinking of flooded yard. Previously, every time it rained, it was certain that the school yard was flooded so that teachers and students could not do their activities outside the classroom.

In addition, the inundated yard can be dangerous as it may cause them to fall. If these conditions continue, it is possible that health aspects will be affected and social interaction between students and teachers will also be disturbed because they could not do exercises together, or other activities outside the classroom.

Until the end of 2016, the number of paving block beneficiaries:

PAVING BLOCK INSTALLATION FOR SCHOOLS

Learning Centre of Tarik Village

One of the learning centresbuilt by Tjiwi Kimia, in collaboration with Solidaritas Istri Kabinet Indonesia Bersatu (Solidarity of Spouses of United Indonesia Cabinet or SIKIB) is located in Tarik Village and was inaugurated in early November 2012. It occupies a permanent building owned by Tjiwi Kimia Employee Cooperative.

At Tarik Village Learning Centre, the handicraft training for mothers has helped increase their income. The handicrafts such as bags and key chains are sold by consigning them to stores/outlets, or through online media. The sales can provide an extra income up to Rp1 million each month, equivalent to almost 37% of Mojokerto minimum wage set by the Government.

Learning Centre is expected to be a form of community empowerment that can improve, not only education for children only, but help mothers to use their free time to earn an extra income. One of the activities included learning English that is regularly held twice a week. It is expected to broaden the horizon of local children in facing the global world.

The Community Development sector is another priority in the implementation of corporate social responsibility by Tjiwi Kimia. Programs and activities that have been implemented and are now brought benefits, included the paving block installation at some schools. In line with the spirit of solid waste recovery through the application of 3R principles at Tjiwi Kimia, namely fly ash and bottom ash, the installation of paving block has benefited both the company and the schools.

Tjiwi Kimia recycles fly ash and bottom ash into raw material for paving blocks. The schools feel the need for paving blocks because their schoolgrounds are often inundated when it rains. This model of symbiotic relation demonstrates that such activities are more than just an assistance, but there is synergy as one of the basic concepts of corporate citizenship (Tracey, Phillips, Haugh, 2005).

One of the schools that received paving block installation in 2013 was SD Negeri Sebani II No.500 elementary school in Sebani Village, Tarik District, Sidoarjo Regency, East Java. The school has a total of 183 students.

882people

1,261people

Sidoarjo Regency

MojokertoRegency


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DEVELOPMENT OF CLEAN WATER FACILITIES

The problem of water supply is not only a regional issue, but has become a global concern. According to ‘The World Economic Forum’ as presented in the 2015 Global Risk Report, the water crisis is a risk faced by the rest of the world because it has the most material impact. Therefore, corporate support in the CEO Water Mandate initiated by United Nation has become very significant.

Tjiwi Kimia responded to the issue of clean water crisis by taking into account the conditions surrounding the mill. With Brantas River and many other rivers stream across the mill’s area, the results of social impact studies showed that Sidoarjo Regency has many wells that could not provide clean water. As many as 500 families living around Tjiwi Kimia Mill were recorded to have difficulty in accessing drinking water. This situation was the reason why Tjiwi Kimia established a clean water program that can help improve community health.

The difficulty in accessing clean water was faced by, among others, the residents of Pajaran Selatan Village, Tarik District, which is adjacent to Tjiwi Kimia. Although unfit for consumption, they still used the well water by precipitating it first to reduce the sour taste and then continue to drink it. There were also residents who chose to buy drinking water refills at the price between Rp3,000 - Rp4,000 for every gallon even if they had to walk far from home.

By building participatory communications, Tjiwi Kimia and the residents were looking for the best solution to overcome clean water problems. In 2015, Tjiwi Kimia built clean water pipe system connected with water treatment plant (WTP). The pipelines are used to distribute clean water to the residents’ homes.

Tjiwi Kimia built the main pipeline facility in the area of production facilities. The residents then installed a connection pipe to their respective homes. The clean water is used by residents, whether to drink, cook or bathe and wash.

The clean water is distributed 24 hours per day. Not only in Pajaran Selatan Village, but also to other villages around Tjiwi Kimia mill area, such as Kramat Temenggung Village located 1-2 km away from the mill.

Clean Water For Pajaran Selatan Village

Number of Beneficiaries of Clean Water Supply

LocationNumber of

Families People

Pajaran Selatan Village

Kramat Temenggung Village

120

146

480

729


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The same issue was faced by residents of Kedung Bocok village, Tarik District, which is 2 km away from the mill. As most of natural conditions in some parts of Sidoarjo, water from their wells can not be used for cooking or drinking.

Tjiwi Kimia was aware of this situation and then held a dialogue with local residents. The agreed solution was to drill a water well and build a tower with a storage tank.

Tjiwi Kimia followed up the plan of water well drilling by sending a team to visit Kedung Bocok Village. The visit was to determine the location of the drilling spot and built the water tower. One of the wells was built in Kedung Bocok Lor Hamlet. The well is located next to the village mosque, with a depth of 40 meters well.

From the storage tank beside the mosque, clean water is then distributed to the residents’ homes. Installation of clean water pipes for distribution to each house was built independently by the residents. A total of 40 families received the clean water supply.

For pump operation, the residents pay monthly dues between Rp10,000 and Rp20,000, according to their respective capabilities. The cost is lower than monthly fees of water supply from Water Utility Company (PAM) in the area. The money collected from dues is used to pay the electricity consumption bill, as well as repair expenses should there be damage to the pump or storage tank. Thus, the community’s active participation is manifested with a sense of responsibility in maintaining the pumps that they share.

Aside from Kedung Bocok Lor Hamlet, Tjiwi Kimia also built water wells in 10 locations, equipped with water towers and storage tank. To ensure the sustainability impact of this program, Tjiwi Kimia has handed over the operation and maintenance of the wells to the residents.

Water well in Kedung Bocok Village


22


23

PT Indah Kiat Pulp & Paper Tbk first established a mill in Perawang, Riau, in 1982, followed by another mill in Serang, Banten, in 1991. Currently the Serang mill is one of the largest paper packaging manufacturers in Indonesia. PT Indah Kiat Pulp & Paper Tbk, Serang (Indah Kiat Serang) uses paper and cardboard waste, raw material for production through recycling process.

Every year, Indah Kiat Serang processes more than one million tons of recycled paper as raw material. For the effort in management of waste material, Indah Kiat Serang became the first company in Asia to be awarded by Bureau of International Recycling (BIR) in 2010.

There are 12 villages adjacent to Indah Kiat Serang mill site. The majority of villagers work as farmers. Some are still living in poor condition so that many children under five are potentially malnourished. In addition, water sources used by communities are unfit for consumption. Based on these conditions, Indah Kiat Serang made an initiative to provide support to the local integrated health service post (Posyandu), as well as implemented a clean water program for the community.

INDAH KIAT SERANG:EDUCATION FORFUTURE GENERATION


24

Y

Y

MAKING SCHOOL FURNITURE

The education sector is a key focus for PT Indah Kiat Pulp & Paper. It is no exception for Indah Kiat Serang which utilizes wooden containers as raw material for school furniture, according to the 3Rs principle.

SD Negeri VI Kragilan elementary school, located near Indah Kiat Serang Mill, was one of the schools that received furniture assistance from Indah Kiat Serang. The condition of the furniture in this school did not support the comfortable and safe teaching and learning activities for teachers and students. The school, which is located in Kampung Cisereh hamlet, Kragilan Village, Kragilan District, has previously received assistance for school ceiling repair in 2014.

The used wooden packaging is recycled for school furniture. This wood waste originated from container wooden pallets, which are packaging of factory equipment that are no longer used for company operations. The idea of recycling this wooden packaging came up from a participatory discussion between Indah Kiat Serang and stakeholders of education in Serang Regency, such as the Education Agency, the Regional Technical Implementation Unit (UPTD) for Education and Schools.

Based on prior communication, one of the obstacles to improve the quality of education in Serang Regency was the lack of school furniture. This condition was addressed by Indah Kiat Serang by providing assistance in school furniture. The furniture making program has become a strategic community empowerment activity for Indah Kiat Serang because of the benefit that created added value. Not only for the company, but also for the beneficiary stakeholders, in this case are the people who made the furniture and the students of the school that received the furniture for learning facilities.

Wood from used containers is a solid waste for Indah Kiat Serang. Therefore, Indah Kiat Serang created the initiative to recycle the waste into furniture. Solid waste management is one of the the company’s business sustainability model targets. With this recycling, then along with the growth of the company’s operations, the volume of recycled container wooden waste will also increase. Thus, furniture making also increases and there will be wider use of furniture for schools.

Recycling Used Wooden Pallet

from Container

Indah Kiat Serang believes that to run a sustainable operation, the company must have a positive impact on the environment and the surrounding community. Therefore, Indah Kiat Serang is committed to improving the welfare of the communities around the mill through various activities, including:

Education Sector

Making school furniture, GNOTA scholarship, Academy of Pulp & Paper Engineering (ATPK) scholarship, Sinar Dunia’s book distribution and school renovation.

Health Sector

Kesling (mobile health service), counseling of posyandu for toddlers and breastfeeding mothers, 6R/6S hygiene competition for public elementary schools and village administration offices of Kragilan District.

Environmental Sector

Planting mangroves on the north coast of Serang, clean water supply, drilling water wells.

Community Economic Empowerment

Making handicrafts by Mitra Kreasi Handicraft and youth of Kragilan District, farmer assistance.


25

The school furniture was produced in the workshop located within the mill area. The work was done by a number of carpenters from local community.

The involvement of carpenters from local community was part of the community empowerment policy. These carpenters were mostly residents who have not gotten a job and received training in carpentry and facilitation as partners. By possessing the carpentry skills, the carpenters can earn income from Rp1.5 million up to Rp3 million per month, depending on the type of work handled. The income is within the range of minimum wage of Serang City 2016, which was at Rp3,010,500.

Implemented Since 2012

Comparison of Recycling Wood from Containers for School Furniture

School Furniture Program Implementation

Local Furniture Indah Kiat Furniture

RECYCLING WOOD FROM CONTAINER

QUALITY

PRICE

The direct sales value of used wooden pallets from container without recycling into furniture

Low quality wood, short life span.

The price of a set of furniture from other seller

The sales value of used wooden pallets from container after being

recycled into a set of furniture

Better wood quality, long life span.

The cost of a set of furniture production that is recycled from used

wooden pallets from container

Rp50,000

Rp500,000

Rp300,000

Rp300,000

60

240

300

360380

600

720760

480

120

Number of Furniture(Set): 1,340

2012

800

700

600

500

400

300

200

100

0

20142013 2015 2016

Number of Beneficiaries : 2,680


26

Indah Kiat Serang will continue the strategic school furniture making program with the following considerations:1. Many schools in Serang Regency still need furniture.2. Indah Kiat Serang has wooden pallets from containers

that are no longer used, but still in a good condition. Thus, making school furniture becomes one of the best management and processing solutions of wood waste as a solid waste.

3. Furniture Making program is a strategic and sustainable form of empowerment because of the involvement of local communities.

In the future, Indah Kiat Serang is looking into the possibilities to develop recycling of wood from containers into educational toys and developing handicrafts. The development of recycling of wood from containers is expected to be a form of community empowerment that can create measurable added value.

Strategic Sustainable Program

Collective Renovation of SDN 6 Kragilan

BUILDING SCHOOLS TOGETHER

Indah Kiat Serang has continued to build communication with stakeholders in the education sector in Serang Regency, Banten. In the dialogue, one of the obstacles to improve the quality of education was the condition of school buildings that was inadequate for teaching and learning activities.

One of the schools prioritized to receive assistance from Indah Kiat Serang is SDN Kragilan 6 elementary school, located in Cisereh Hamlet, Kragilan Village, Kragilan District and is in the company’s ring 1 area. The condition of this school required immediate renovation due to a leaking and brittle roof, because it could endanger the community in addition to disrupting learning activities. The repair was carried out in April 2015. The project included the renovation of class partition walls, installation of roof cassette and class ceilings.

The school building renovation was carried out collectively, with schools and local community’s intensive involvement. The contributions provided by the school and community were in the form of money, manpower and School Operational Assistance (BOS) funds.

In addition to SDN Kragilan 6, over security reasons, school building renovation was also provided to SDN Jeruk Tipis 3 and SDN Jeruk Tipis 1 elementary schools, also located around Indah Kiat Serang Mill. With the assistance of school building renovation, Indah Kiat Serang hopes to make long-term contributions to efforts of education improvement in Serang Regency.

Beneficiaries of School Renovation Program

SchoolNumber of Beneficiaries

Student Teacher & Staff

SDN Kragilan 6

SDN Jeruk Tipis 1

SDN Jeruk Tipis 3

166

211

254

11

10

12

Realizing this, Indah Kiat Serang held discussions with a number of parties, including Education Agency, Regional Technical Implementation Unit (UPTD) of Education, village adminstration and local communities as well as other stakeholders. Through these participatory discussions, it was identified the need for private sector roles to support the improvement of school infrastructure in the region. Therefore, based on the results of this discussion, Indah Kiat Serang repaired the school buildings around the mill site. Improvement of school buildings is one form of corporate support to the Government program that promotes the strengthening of actors in education and culture sector.


27

NATIONAL MOVEMENT OF FOSTER PARENTS (GNOTA) SCHOLARSHIPS

As one of the key stakeholders, Indah Kiat Serang also strives to raise the employees’ awareness of the surrounding environment. One of the efforts undertaken is through the GNOTA Peduli Scholarship Program, which aims to provide a platform for employees to contribute to the sustainability of education for underprivileged students. This program has started since 1997 and continues until now.

GNOTA Peduli Scholarship Program is provided in seven districts in the vicinity of Indah Kiat Serang, namely Kragilan, Carenang, Tanara, Tirtayasa, Pontang, Lebak Wangi, Binuang and Pamarayan districts. Since the start of the GNOTA program, over 30,000 students have been recorded to receive scholarships for elementary education or equivalent, junior high school or equivalent and senior high school or equivalent.

Employee Participation

The employee engagement in the GNOTA Peduli Scholarship Program is introduced through dissemination during the General Training Orientation (TUO) for new employees, as well as incorporated during other training activities throughout the year. The dissemination is delivered by the Public Affairs/Public Relations team. Each employee can determine the number of students that will be assisted. The scholarship is provided for children from lower income families through schools, government programs and corporate events. By the end of 2015, there were approximately 600 employees participating in the programme.

Total Recipients of GNOTA Scholarships

Total Scholarship Recipients (students)



2015

/201

6

ACADEMIC YEAR

2014

/201

520

13/2

014

Total Donors (people)



Total Funds (Rp)

Total Funds (Rp)

Total Funds (Rp)

2,163

1,576

1,752

778

525

580

229,548,000

168,678,000

186,246,000


28

Y

From Photo Frame to Becak Miniature

CREATING ART WORKS

The waste paper from used packaging is recycled by Indah Kiat Serang in cooperation with partners, one of which is with Mitra Kreasi Handicraft. Mitra Kreasi Handicraft is a business group with 20 members that was established in 2009. This business group recycles waste from paper production of Indah Kiat Serang, an industrial unit of APP, to produce various handicrafts and shopping bags.

The handicraft training is held at a house in Kampung Pabuaran Indah Hamlet, Kragilan Village, Kragilan District, which is used as a workshop. The training is delivered directly by the management of Mitra Kreasi Handicraft, by teaching the youths to make various handicrafts from waste packaging paper, supplied by Indah Kiat Serang.

Solid waste management is one of the targets in our sustainable business activities. Waste is managed through the concept of 3Rs (reduce, reuse, recycle), reduction of waste and the creation of economic value from waste utilization. The waste management by Indah Kiat Serang is implemented by recycling material waste into raw material of art production from used cardboard bxes and waste paper.

Currently, there have been 21 varieties of handicrafts made from packaging paper that is no longer used, from picture frame, tissue box, bottle water, to miniatures of pinisi ships, becak (rickshaw), and tower of the old Banten Mosque. The handicrafts are sold to public or purchased by Indah Kiat Serang for souvenirs. This synergy between producers and buyers has created an integrated chain of production and marketing processes, which can ensure the sustainability of the handicraft business.

During the past ten years, the handicrafts made by Mitra Kreasi Handicraft started to gain appreciation from the public. In 2014, this appreciation was given by the Indonesia Green Awards for category of handicraft using waste paper as material. In addition, this business group has also penetrated the international market by exporting 250 pencil cases to Japan.

Mitra Kreasi Handicraft products also began to be known by the public. There has been demand from several companies and agencies for these handicrafts. However, not all demands could be met due to limited human resources. It was a challenge for Mitra Kreasi Handicraft to attract the surrounding communities, especially those who needed work, to be willing to improve their skills in order to increase their income. Therefore, capacity building activities are needed, including provision of training on this handicraft making skills.


29

POSYANDUDEVELOPMENT

The existence of Posyandu (Integrated Health Service Post) is important to improve the community’s health. Posyandu needs to be continuously empowered for a healthy generation. This is in line with the Ministry of Health’s call for Posyandu as a form of Community Based Health Initiative (UKBM) managed from, by, for, and with the community. Posyandu is also used as a form of community empowerment in providing easy access to basic health services for mothers, children and toddlers.

Management of Posyandu for toddlers and mothers is the focus of community development implementation by Indah Kiat Serang in health sector. This is based on the mothers’ lack of awareness in Serang Regency to come to Posyandu and the high number of malnourished patients in Banten province, which reached 50,092 people. This figure is the third highest after East Nusa Tenggara (NTT) and East Java. It is a worrying situation that needs serious handling.

The lack of the mothers’ awareness to come to posyandu is a challenge for posyandu cadres. Through the cadres’ collective efforts, posyandu activities in Kendayakan Village, which is close to Indah Kiat Serang Mill, has now been much better. This is indicated by the increasing average number of visits of mothers and toddlers about 50%.

Until mid 2016 there were eight posyandu and two weighing posts in Kendayakan Village. The health of mothers and toddlers also on average increased after regular health checks.

Mothers’ Awareness

Number of Visits of Toddlers and Mothers to Posyandu of Kendayakan Village and three villages in Kragilan District Supported by Indah Kiat Serang

Kendayakan Village, Kragilan District

Undar-Andir Village, Kragilan District

Dukuh Village, Kragilan District

TOTAL 71 643

Jeruk Tipis Village, Kragilan District

17 Expectant Mothers




172 Toddlers

217 Toddlers

102 Toddlers

152 Toddlers


30

Since 2011, Posyandu development activities have targeted five districts in Serang, namely Pontang, Tirtayasa, Tanara, Carenang, and Kragilan. The activities were carried out by Posyandu cadres by visiting each home of families with toddlers that did not come to regular activities of Posyandu. The aim was to ensure proper monitoring

Indah Kiat Serang is committed to continue its support for Posyandu activities. This support is realized by aligning the activities of posyandu development with the Government’s mobile health service program, so that people will receive medical explanation directly from physicians.

Healthy Generation Awareness

Data of Posyandu and Weighing Posts

32 Posts20 Posts

32 Posts20 Posts

32 Posts20 Posts

34 Posts22 Posts

34 Posts22 Posts

Kragilan | 8 Villages

Tirtayasa | 8 Villages

Tanara | 8 Villages

Carenang | 6 Villages

Pontang | 6 Villages

POSYANDU WEIGHINGPOSTS

Indah Kiat Serang’s participation in providing assistance to posyandu activities is a realization of commitment to the Sustainable Development Goals (SDGs). The activities were carried out in collaboration with all stakeholders, including puskesmas (community health centre), PKK (Family Empowerment for Welfare), posyandu cadres, and village administration. Indah Kiat Serang also provides Health Card for Toddler to ensure monitoring of children’s development from time to time.

Indah Kiat Serang’s commitment to support Posyandu activities around the area of mill’s operation, received appreciation from the Serang Regency Government. In April 2016, the Regent of Serang visited the Posyandu and conducted various Posyandu activities together with posyandu cadres and Indah Kiat Serang team.

Appreciation from

Serang Regency Government


31

INCREASING ACCESS TO CLEAN WATER

In 1995, the Government built a rainwater storage tank in Kampung Kejawi. However, the rainwater storage tank only worked for a few months because it was damaged and could no longer be used.

Residents can actually get clean water by making their own wells. However the cost to drill wells is too high for them who are mostly tillers or laborers. Therefore, the residents could not meet their need for clean water.

Clean water is one of the assistance programs of Indah Kiat Serang, which is developed based on the community’s needs and in line with the company’s commitment to carry out the main activities in maintaining and taking advantage of the sustainability of the water cycle. This water supply assistance is provided in cooperation with the local water utility company by building water wells.

The assistance of communal water well construction was given in 2012, and it is still in use until now. Aside from water well, water tower was also built along with a storage tank. The well is located next to the village mosque, and the water is flowed through six faucets, which are also used for ablution.

The communal water well is managed and maintained by the residents as a form of active participation. There are a total of 15 families that use the clean water and each of them pays monthly dues of Rp10,000. The money is used for maintenance and repair if there is damage, as well as for payment of electricity bill because the well is still connected with electricity from the village mosque.

Water is an important element in our daily life. The difficulties in accessing clean water in Serang Regency, especially in the surrounding area of Indah Kiat Serang make the water supply program one of the significant corporate social responsibility programs.

Kampung Kajawi Hamlet, Walikukun Village in Carenang District, Serang Regency is one of the villages that received clean water supply through communal water wells. Located 3 km away from the Indah Kiat Serang Mill, Kampung Kajawi Hamlet is identified as one of the areas that has minimal clean water access level. Not only bathing and washing, clean water from the river has to be used also for cooking and as drinking water, although it was unfit for consumption.

Clean Water Supply

In addition to Kampung Kejawi Hamlet, there were several other places that received assistance to build communal water well, either directly conducted by Indah Kiat Serang, or through collaboration with NGO Habitat for Humanity Indonesia and Asia Pulp & Paper (APP) - the parent company of PT Indah Kiat Pulp & Paper Tbk. One of these wells is located at SMK Sultan Agung Tirtayasa in Sampar Wadi Village, Tirtayasa District. Built in 2014, the communal water well is now used by 300 students and teachers, and 30 families in Sampar Wadi Village.

The locations of water well drilling, which is in collaboration with NGO Habitat for Humanity Indonesia, among others are in Kampung Sukamulya and Kampung Sukawangi hamlets, Ragas Masigit Village, Carenang District. The drilling of the wells was also followed by the construction of public toilet facilities.

Construction of Water Wells in Other Areas

Number of Locations of Water Well Assistance

19 Locations

4,750 Families

7,600 People

20 Locations

5,000 Families

8,000 People

16 Locations

4,000 Families

6,400 People

11 Locations

2,750 Families

4,400 People

10 Locations

2,500 Families

4,000 People

2012

2014

2016

2013

2015

YEAR OF ACTIVITY

NUMBER OF LOCATIONS

FAMILIES

PEOPLE

76

19,000

30,400


32

23% 10% 10% 9%

8%

7%

7%

6%

4%

4

% 4%

4%1

%0.4%

Y

In the next few years, the need for clean water will remain the main problem of most residents in Serang Regency. It was indicated in the results of the Social Impact Study 2016 conducted by Indah Kiat Serang and the Sharia Economic Group of State Islamic Institute (IAIN) Sultan Maulana Hasanuddin, Banten.

Clean water supply is provided by Indah Kiat Serang and Habitat for Humanity Indonesia along with by efforts to raise awareness of clean and healthy lifestyle (PHBS). This awareness is important as the basis for behavior change to ensure optimal but efficient use of clean water. The awareness that clean water is a natural resource that needs to be preserved becomes a key topic in every training program. In the future, Indah Kiat Serang will continue to implement the environmental preservation commitment as support to the achievement of SDGs, namely the provision of clean water and environmental sanitation.

Becoming Priority in the Future

Results of Social Impact Study - 2016

REQUIRED PROGRAMS

Clean Water

Health

Daily Necessities

Waste Handling

Latrine

Education

Donation

Jobs

Landfill

Road Repair

Business Capital Loan

Religious Affairs

Skills Training

No Answer

Total

NUMBER OF RESPONDENTS (PEOPLE)

140

60

60

51

46

44

40

33

25

25

24

8

1

25

600

IRRIGATION IMPROVEMENT

Water remains a problem for most farmers on the banks of Ciujung River, which is the ring 1 area of Indah Kiat Serang. Lack of water supply, especially during dry season hinders the farmers from getting maximum yield. This condition affects their income and welfare.

For water needed to irrigate the paddy fields, Indah Kiat Serang installed water pumps. Water pumps with substantial capacity will help increase the quantity and quality of the harvest, which will increase the income. Thus, the welfare of farmers increases and the poverty rate can be reduced. In the long term, if the empowerment activities of these farmers are done massively, then the target of poverty reduction established by the Government at 6-8% is expected to be achieved.

In early 2010, Indah Kiat Serang provided 36 pumps to various farmer groups in Serang Regency in four districts.

1%

0.4%


33

*Note: All pumps operating properly

YEAR

Number of Pumps: 6Number of Farmer Groups: 6

Number of Pumps: 6

Number of Farmer Groups: 6

Number of Pumps: 7


Number of Pumps: 4


Number ofPumps: 7Number of Farmer Groups: 7



AVERAGE HARVEST OUTPUT :

IRRIGATION TIME :

OPERATIONAL COST :

AVERAGE HARVEST OUTPUT :

IRRIGATION TIME :

OPERATIONAL COST :

From Small Pump

Becoming Large Pump

Installation of Water Pumps for Farmer Groups in Serang Regency

Members of Suka Damai Farmer Group, who mostly live in Kampung Kubang Bali Hamlet, Kubang Puji Village, Pontang District, used the pump with small capacity before receiving assistance of water pump with large capacity.

For the members of the farmer group, large water pump has helped increase the group’s treasury. After harvesting, Suka Damai Farmer Group can save the average of Rp5 million in cash, from the previous Rp3 million. It is important to have treasury in cash because it can be used to meet other operational needs.

5–6 tonnes of grain/ha

1 week/20ha

Rp980,000/20ha

6-8 tonnes of grain/ha

3 days/20ha

Rp392,000/20ha

Small capacity pump

2010

2011

2013

2015

2012

2014

2016

Large capacity pumps


34

MANGROVE PLANTING

The community empowerment program of Indah Kiat Serang in the other environmental sector is mangrove planting along the coast of Kampung Lontar Hamlet, Lontar Village, Tirtayasa District, Serang Regency. The hamlet is located 28 km away from Indah Kiat Serang Mill and a coastal area that requires conservation to prevent more severe abrasion damage.

Mangrove planting is carried out as a commitment of Indah Kiat Serang to biodiversity conservation and preservation. This initiative is one of the targets and elements of sustainable business model that is part of the Sustainability Roadmap - Vision 2020.

Aside from abrasion, massive sand quarrying has made the beach no longer enjoyable to visit. Many ponds created from sand quarrying are abandoned. In addition, there are also some abandoned shacks because they are not properly maintained and eventually damaged. Mangrove forest destruction and threat of abrasion also occur in some northern coastal areas of Serang Regency.

The mangrove reforestation program began in 2010 in the coastal area. Initially, the initiative of mangrove reforestation had failed due to lack of maintenance and unsuitable seedlings that were planted.

Coastal Ecosystem Conservation

Locations and Number of Mangrove Trees Planted

Year Planting Locations Number of Mangrove Trees (Trees) Area of Land (Hectares)

2010

2012

2014

2016

Tirtayasa District - Lontar Beach, Lontar Village

Pontang District - Domas Village, Kali Nyapah Block

Tirtayasa District – Lontar, Fish Auction Block

Pontang District, Pancer Block

Tanara District – Pedaleman Village, Kali Pecuk

Tirtayasa District – Berambang Hamlet, Lontar Village

10,000

30,000

50,000

10,000

1

3

1.5

2

1.5

1

To overcome this failure, Indah Kiat Serang worked together with NGO “Association of Brambang Youth and Community” Serang. The collaboration included provision of local mangrove seedlings and post-planting maintenance until the mangrove trees were fully grown.

From 2010 until now, mangrove planting has been conducted in four coastal areas of Serang. Every year, the number of mangrove trees being planted continues to increase. Until the end of 2016, a total of 100,000 mangrove trees of various types have been planted. The coverage of coastal areas that have been planted with mangrove trees reached 10 ten hectares.


35

On the coast of Kampung Lontar Hamlet, the age of mangrove trees has now reached five years. Gradually, the coastal ecosystems also began to recover with the presence of marine biota that previously was not found.

Areas planted with mangrove trees have also relatively been in better condition. The mangroves have managed to reduce the impact of waves crashing into the land, thus reducing the risk of abrasion and the emergence of biodiversity.

Indah Kiat Serang has now begun to plan other programs as the continuation of mangrove planting. The mangrove trees on the coast of Kampung Lontar Hamlet are expected to give positive impact of multiplier effect, such as utilizing the mangrove fruit and developing the mangrove forest area as a tourist area.

Indah Kiat Serang also plans to expand the area for mangrove planting, although it has to face some obstacles, such as status of land tenure as the location of mangrove planting, lack of local mangrove seedlings availability that are suitable for Serang coastal conditions and Serang coastal community’s lack of awareness of the mangrove forest importance.

Program Development

To overcome this obstacle, Indah Kiat Serang’s strategy is to increase partnership with competent parties, local government, community leaders and credible non-government organizations. The participation of relevant stakeholders is also the key to success in implementing environmental conservation initiatives.

In addition to area expansion, Indah Kiat Serang also plans to develop the mangrove area into a tourist area by contributing to economic empowering coastal communities. This will be carried out with the consideration of mangrove trees have grown good and is big so it has the potential to be developed into a tourist area. Related to economic development, there are already potential local communities in the economic field such as fishermen and mothers craftsmen for seaweed processing in the region.


36

INDAH KIAT PERAWANG:EMPOWERMENT OF SIAK RIVERSIDE COMMUNITY

One of PT Indah Kiat Pulp & Paper Tbk’s mills is located in Tualang Perawang or more often called Perawang, which is within Tualang District, Siak Regency. Perawang was selected to be the location of Indah Kiat’s second mill, due to its strategic location close to Industrial Forest Plantation (HTI), thus ensuring continuity of raw material supply. In addition, Siak River can be developed as a port for transporting raw materials and products of PT Indah Kiat Pulp & Paper Tbk, Perawang (Indah Kiat Perawang).

Tualang District is a lowland area with very wide hills. The majority of land in Tualang District is for oil palm and rubber plantations. In addition, there are also several food and vegetable commodities developed in Tualang District,

among others, corn, mung beans, cassava, long beans, chili, eggplant, cucumber, spinach and kale. Local community health tended to be low due to unhealthy and poor environmental conditions such as lack of drainage system, garbage and water that was not fit to use. Based on these conditions, Indah Kiat Perawang undertook the initiative to provide clean water for sanitation and floating clinic for health facilities. In addition, soft loan cooperative was established as a form of community development and empowerment.


37

Along with global dynamics, the management of Indah Kiat Perawang is also aimed at achieving sustainable development goals for the communities surrounding the company, as one of the key stakeholders. Communities as beneficiaries of empowerment programs are expected to be independent and together with the company, are able to create a harmonious environment.

Community empowerment programs undertaken by Indah Kiat Perawang include:

Education Program: Activities which are conducted include the implementation of student ability tests (try-out), scholarships for university students, university entrance guidance, education infrastructure assistance, field work practice (internship).

Community Health Program: The activities undertaken are focused on the importance of health and regular medical treatment for Siak Riverside community, the provision of clean water for the community, and training of posyandu cadres.

Farming and Husbandry Program: The activities undertaken are improving the capacity of farmers by training, providing soft loan assistance, facilitation and improving networking with the agricultural agency, providing revolving cows to the target communities

Economic Empowerment Program for Micro Small Medium Enterprises: Activities include Siak weaving training, strapping rope utilization by Tunas Harapan Artisan Group, Disbursement of revolving capital loans through LKM Rumah Pintar Abdul Wahid learning centre, welding technical training and workshop business as well as cake-making training for housewives.

Y

Improving the Community’s Welfare

ABDUL WAHIDLEARNING CENTRE

Abdul Wahid Learning Centre was founded by Indah Kiat Perawang with Solidarity of Wives of United Indonesia Cabinet (SIKIB). Its location is in the middle of residential area in Perawang Village, Tualang District. The learning centre was named as a homage for Abdul Wahid, a figure in the time of Sri Inderapura Sultanate of Siak and the declarator of Riau Province formation.

Abdul Wahid Learning Centre has six centres. One of them is Craft Centre (Sentra Kriya), which organises several training for the community to build capacity and form the spirit of business.

The Craft Centre is supported by Micro Finance Institution (LKM), which provides revolving capital loans. The training participants get the opportunity to establish or expand their businesses with the loans. The growing community business activities will boost the creation of jobs.

Village Infrastructure Development Program : The activities undertaken are to help supply electricity to the community and the development of village infrastructure.


38

Y

ABDUL WAHID MICROFINANCE INSTITUTION

The need for MFI establishment was indentified by the results of social mapping conducted by Indah Kiat Perawang in 2016. MFI is expected to be an alternative source of business capital financing for local communities. The MFI is necessary because the communities have limited information and access to business capital loans from banks.

Together with the establishment of Abdul Wahid Learning Centre by Indah Kiat Perawang together with the Solidarity of Wives of United Indonesia Cabinet (SIKIB) in 2011, the MFI was established as one of the centres at the Learning Centre. A year later, the MFI began to provide business capital loans.

Target beneficiaries of business capital loans are small businesses in Tualang District and other districts in Siak Regency. The prospective beneficiaries first participate in farming and entrepreneurship training organized by CSR team of Indah Kiat Perawang. They prepare a proposal or business plan as a condition of applying for business capital loan. Each prospective beneficiary who passes the verification is required to make a brief presentation as well as question and answer session in front of CSR team of Indah Kiat Perawang.

The results of the presentation and Q&A session will be used as consideration to decide whether they are eligible for revolving business capital loan and business facilitation from Indah Kiat Perawang. Business facilitation and evaluation to the recipients of revolving business capital assistance are carried out based on schedule until the granted business capital loan is repaid.

The provision of revolving business capital is validated by a letter of agreement between the company and the beneficiaries. It aims to strengthen the beneficiaries’ commitment to properly utilize and manage the revolving business capital assistance for their business development. The letter of agreement is also acknowledged by the local governments, either district head, District Extension Centre (BPK) or village chief.

Since its establishment, MFI has been improving the process of selection, distribution and management of loans. By the end of 2015, a total of Rp396 million in funds has been

disbursed by MFI as business capital loans for 70 farmers. The majority of beneficiaries are engaged in agriculture by planting various kinds of fruits and non-rice crops.

Of the disbursed loans, the repayment rate varies from 35% to 86%. The low repayment rate was due to various reasons, such as the difficulty of marketing and the climate impacts that affected the business. Therefore, it required guarantee from customers in the form of goods or securities to maximize loan repayment.

To support the community receiving the capital assistance can continue to run their business, Indah Kiat Perawang provided facilitation and attempted to open marketing access in cooperation with other parties, such as cooperatives. Periodically, CSR team of Indah Kiat Perawang also visited the businesses to discuss and identify problems and find solutions that can be mutually done.

MicroFinance Institution (MFI)

One of the targets of business capital loans is vegetable and fruit farmers in Tualang District, including farmers grouped in Women Farmer Group (Kelompok Wanita Tani or KWT). The agriculture sector is a priority because of the following considerations:• There are still many unutilized and potential productive

land for growing vegetables and fruit trees.• The market potential is open, considering that the

population of Siak Regency is mostly concentrated in Tualang District. In addition, the supply of vegetables is still very limited.

• Vegetable planting intervals are short and can be harvested within 14 - 60 days. The selected fruit trees are those that can be harvested throughout the year regardless of season, such as guava, papaya and starfruit.

However, the development of the agricultural sector in Tualang District also faced challenges, such as:1. The type of soil in Siak Regency is clay and peatland, which

require special treatment to be able to grow vegetables and fruits.

2. Continuous facilitation is required for the smallholders, especially in terms of techniques in cultivation, care and post-harvest handling.

To overcome these obstacles, Indah Kiat Perawang cooperates and coordinates with agriculture extension field workers (PPL) to provide training and facilitation.

Farmer Empowerment


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There are several vegetable and fruit farmers who have received revolving business capital loans from the MFI and have been able to expand their business. One of the fruit farmers who received revolving loans was husband and wife Gantang Perangin-angin and Riahmuli Boru Sitepu who manage guava garden on the side of Perawang - Minas KM 17 road. They manage the guava garden and have already received two loan assistance from the MFI. The first loan received in 2012 amounted to Rp6 million and the second loan in 2014 was Rp8 million. The loans were used to purchase gardening equipment, fertilizer and guava seeds.

By managing the guava garden, the farmers can get an average monthly income of Rp5 million to Rp6 million. The income was 3 times higher than the minimum wage established by Perawang Local Government in 2015.

Periodically, fruit farmers also employ the local community to help care for guava trees. There are two workers who always help and in a month they work for a week. The success of fruit farmers who received assistance from MFI has been able to create jobs for the local residents. In the long run, the positive impact of the guava farmers’ success is expected to help improve the community’s welfare, including increasing the commodity competitiveness of garden produces in Perawang region.

In addition to the fruit farmers who receive revolving loans from MFI Abdul Wahid Learning Centre, there is also assistance for vegetable farmers. Sri Hartuti is one of the vegetable farmers who get loans. Sri has already received two loans. She received the first in 2013 amounted to Rp 5 million with repayment by installment for two years. In 2015, Sri applied for another loan of Rp7 million with

the same tenure as before. The loan was used to develop 1.5 hectares of vegetable garden of spinach, mustard and cabbage. In a month, vegetable farmers can earn an additional income of about Rp3 million to Rp4 million, or equivalent to the minimum wage of Perawang region in 2015.


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Fish Nursery

Another sector which is also facilitated by MFI Abdul Wahid Learning Centre is fishery business development. One of successful beneficiaries of revolving business capital loan is Lasiman, owner of fish nursery business in Tualang Village, Tualang District.

Starting the fish nursery business about three years ago, now Lasiman has become the main supplier of fish seeds in Perawang. Seeds of fish are shipped from Java Island. Fish seeds are not directly sold, but first rearing them in the prepared pond. The rearing aims to adapt to the climate and water conditions in Perawang. This is what made Lasiman’s business different from other similar businesses in Perawang.

Lasiman received Rp6 million of business capital assistance in 2014. He used the loan to buy fish eggs and seeds from Java Island, build a pond, and buy feed. The income from selling fish seeds awas used by Lasiman to buy three goats and bred them. Now, the number has grown to 12 adult goats and three kids. In the future, Lasiman wishes to expand the fish nursery business, goat breeding and also start cattle breeding business.

SKILL TRAINING OF CRAFT CENTRE

In addition to the MFI, Indah Kiat Perawang through Abdul Wahid Learning Centre, organises a number of training programs, that are expected to provide the surrounding communities with some skills to get or create jobs. The training is needed because of increasing competition in job search, so that it skills are required for Perawang residents to be able to create their own jobs. Job creation will produce entrepreneurs who will be able to create new jobs. New job creation will reduce dependence on the company and support the government reduce unemployment and poverty.

The training programs held at Abdul Wahid Learning include is Siak woven fabric, which is a heritage of Sri Inderapura Sultanate of Siak. The siak weaving training is an effort to preserve cultural heritage and maintain tradition.

Siak weaving training began in 2011. By the end of 2016, there were three training batches with a total of 15 participants. After undergoing training, they get an apprenticeship opportunity and refine their skills by working on orders of siak woven fabrics at Abdul Wahid Learning Centre.

Siak Weaving Training


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SKILL TRAINING OF CRAFT CENTRE

Iron Welding Training

Indah Kiat Perawang, through Abdul Wahid Learning Centre also holds welding training for school drop-outs in Perawang. The first training was attended by 14 drop-outs from seven villages. Training starts from iron cutting, shaping motif and welding into fence, trellis, doors or other pieces.

The target of the training is to build the capacity of the drop out youths and equip them with welding skills. It is expected to grow the business spirit and eventually they are able to open their own business. To support this, Indah Kiat Perawang provides the revolving business capital assistance for welding equipment supply.

After the first batch training, there were trainees who opened door-to-door welding business and some others chose to work in the welding workshop. One of the welding trainees who opened the welding business was Defri. The young man who only graduated from junior high school, started his door-to-door welding business with the business capital assistance of Rp10 million from Indah Kiat Perawang. The assistance was provided in the form of a welding equipment.

Now Defri goes door-to-door offering his welding services. Slowly but surely he began to receive orders for making trellis for windows from the residents. Every month, there are orders to make 7 to 20 units of the window trellis, with costs reaching Rp250,000 per unit of window trellis. In addition, Defri also received welding requests for boats mooring along Siak River. By managing his own welding business, Defri earns an average net income of Rp1,500,000 per month.

While working on orders, they receive income ranging from Rp150,000 to Rp200,000 per piece of fabric. Every month they are able to finish 3 to 4 pieces of fabric. After going through the apprenticeship process, it is expected that they will be able to finish 8 to 10 pieces of fabric every month. Thus, the income they earned is in accordance with the minimum wage of Perawang area established by the Government.

With such market opportunities, weaving business is actually promising and able to empower women in Perawang. Therefore, Indah Kiat Perawang establish cooperation to introduce Siak woven fabric and provide weaving class, such as through school. It is very important for the young generation to learn about Siak woven fabric so that they can preserve the cultural heritage. Moreover, the demand of Siak woven cloth has been increasing every day.


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Y

INTEGRATED FARMING DEVELOPMENT

Since 2012, Indah Kiat Perawang has carried out revolving cow breeding programmes to empower the community by preparing them to become superior cow breeders.

Parent cow assistance was provided to be raised and bred until they have calves. These calves became were given to the community of beneficiaries, who then raised them. The parent cows were returned to Indah Kiat Perawang to be reproduced.

The cows are kept in self-built pens. The funds to build the pens were from loans provided by the Village Economic Body (BED). The loans were repaid by each members’ contributions of Rp50,000 monthly. The loan has now been fully repaid.

One of the beneficiaries of revolving cow breeding program was a group of residents in Kampung Pinang, Sebatang Timur, led by Sudarmo. They received 13 cows in December 2014, and two of them had calves. Sudarmo and his group’s success received appreciation from local government. They received 25 cows as the prize and funding assistance to build a permanent cow shed. Five members of the group were also sent to Palembang, South Sumatra to receive training on cow breeding.

Now, most of the group’s members are already independent. There were already group members who sold their cows for the first time after breeding them for 7 to 8 months. The cow was sold at Rp9 million. The amount of income has increased the group members income by an average of Rp1,000,000 per month.

Cow Breeding Revolving Program

Synergy with Local Government

and Community

Towards Integrated Farming

The success of the breeder group led by Sudarmo in cooperation with the Regional Executive Board (BED) has been inspiring. It proved that empowerment programs can be synergized with the community’s potential and support local government programs. The collaboration between company, community and local government was in line with the partnership principle in corporate social responsibility.

In the long-term plan prepared by Indah Kiat Perawang, the provision of revolving cow breeding assistance becomes part of the integrated farming development realization. It is possible because there is regional potentials that have not been maximized. In the future, when the cow farm grows, then farmers in Perawang can get a supply of natural fertiliser which is important for the implementation of sustainable agriculture.

Sustainable agriculture has a broad positive impact. Conway & Barbier (1990) revealed that the sustainable agriculture concept is beneficial for maintaining food security, preserving the environment, and maintaining soil fertility. These benefits are also able to improve cost efficiency in managing sustainable agriculture.

So far, several clusters of cow breeding managed by the community from revolving cow breeding assistance have begun to show encouraging results, including the cow breeding run by Nazaruddin in Kampung Maredan, Tualang District.

Nazaruddin is the recipient revolving cow breeding assistance from Indah Kiat Perawang in 2012. In the beginning, there was only one calf received from the assistance of Indah Kiat Perawang, but now has grown into six cows.

Nazaruddin has also utilized the cow manure and urine for his oil palm plantation. The results from natural fertiliser use has been much better than using other fertilisers. Aside from his own use, the cow manure and urine can also be sold. One sack of 20 kilogram cow manure was valued at Rp15,000, and one jerry can of 20 liters of cow urine was sold at the price of Rp5,000. Every week, there were always cow manure and cow urine got sold.


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10

9

20

9

10

4

0

10

9

40

9

10

4

0

0

0

0

0

0

1

1

0

0

0

0

0

17

13

Number of Groups and Individuals of Cow Breeding Assistance Beneficiaries

YearIndividual GroupNumber of Cows Number of Cows

2008

2009

2010

2012

2013

2015

2016

Beneficiaries and Number of Cow Breeding Assistance

Total 62 82 2 30

Aside from the benefits, there were also obstacles faced in raising cattle. The beneficiaries often could not wait to keep the calves until they become adults because it took 2-3 years of rearing. As a result, many calves were sold before becoming adults.

This tendency was common in individual beneficiaries. Indah Kiat Perawang responded to this by prioritizing the distribution of revolving cow breeding assistance for the group. In groups, the beneficiaries have a moral responsibility to jointly breed the cattle. In addition, monitoring in the field was also easier to do by groups of farmers, than individuals.

The lack of knowledge of rearing and breeding cows cattle was also an obstacle. Indah Kiat Perawang followed up this by helping provide training and facilitation, as well as regular visits by veterinarians to ensure the health of the cows being raised.


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STRAPPING BAND MAKERS

Strapping bands are plastic straps that Indah Kiat Perawang uses to tie up pallets containing manufactured goods, such as HVS paper and other products. Strapping bands used for woven crafts are pieces of bands that can no longer be used for packaging.

Recycling of strapping bands as a base material for woven crafts that can be shaped into baskets, pots, mats, food dome, or other container shapes that can be sold to the market. This program succeeded in creating job opportunities for people in need, especially for mothers to make use of their spare time. The United Nations Development Program (UNDP) says that job creation for those who need it, is part of the market inclusion concept that continues to be developed to help improve welfare. For the success of the strapping band makers, Indah Kiat Perawang received an appreciation of Indonesia Green Award in 2014.

Utilizing Strapping Band

Increasing Family Income

After eight years, the Artisan Group in Tualang Village, called ‘Tunas Harapan’ now has members of around 45 housewives from four neighborhood units (RT). Every month, hundreds of handicrafts were sold and the sales area grew wider. Demand not only came from cities in Riau Province, but also from West Sumatra.

The volume of strapping band used also increased. Until the end of 2015, every month there were two tonnes of strapping bands used as base materials for woven crafts. The strapping bands were entirely purchased from Indah Kiat Perawang. This synergy is one of the concept of Creating Shared Value (CSV) which shows the the measure between the growth of the company’s business with the level of community welfare as partners that grow together. This concept will continue to be developed by Asia Pulp & Paper Group for future community empowerment activities.

The sales revenues from the strapping bands purchased by Artisan Group are refunded by Indah Kiat Perawang to Tunas Harapan Artisan Group. The refund is intended as a form of support for the construction of supporting facilities, including water wells, pumps and washing ponds. In addition, the company also buys the strapping band woven crafts made by the artisans as souvenirs for guests and facilitates the artisans’ participation of in various exhibitions.

The success of Tunas Harapan Artisan Group in expanding the market managed to improve the welfare of its members. They received wage at an average of Rp500,000 to Rp700,000 per month. The amount was an extra income (about 20% of Perawang minimum wage), which is very useful to help meet their family’s daily needs.


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HEALTH CARE SERVICES ON FLOATING CLINIC

Lubuk Meriam Hamlet, Kampung Kuala Gasib in Koto Gasib District, is one of the residential areas on the bank of Siak River, approximately 30 km away from Indah Kiat Perawang. The residents’ livelihood includes working as oil palm growers and rubber farmers. Some also work as fishermen in the river and making the fish into smoked fish that are sold in Perawang from the boat sailing along Siak River.

The residents of Lubuk Meriam Hamlet also have difficulties in meeting the needs of clean water. They rely on rainwater that is collected and stored in a storage tank. It is also not easy to buy drinking water refill because they need to go out of the hamlet and the price is relatively high. Some residents also drilled wells, but it is only operated during the dry season, as the high price of diesel fuel needed for its operation.

Siak River becomes the main means of transportation for the community, including for Indah Kiat Perawang for the traffic of pulp and paper carriers. All this time, some of people in Siak Regency still live on the banks of Siak River. Their homes are located in quite a remote area and difficult to access by road.

Community Around Siak River

Similarly in health services, residents have had difficulties in visiting puskesmas (community health centres). Aside from its remote location, the road conditions are not easy to access by motorcycle. When sick, residents rely on over-the-counter medicines sold in stalls.


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Since 2002, Indah Kiat Perawang has provided health care assistance to residents on the banks of Siak River, including the residents of Lubuk Meriam Hamlet. Health services are carried out by floating clinic.

Floating Clinic is a form of medical service on the speed boat. In the speedboat, there are physician and medical team from Tualang Community Health Centre. The speedboats also carry medicines provided for the residents’ medical treatment.

The floating clinic departs from Indah Kiat Perawang jetty and sails along Siak River to visit the riverside hamlets one by one. Lubuk Meriam Hamlet’s schedule to be visited is on the second week of each month. The community needs medicine and health consultation to cure the diseases that often occur such as itch, flatulence or health problems due to high cholesterol.

Through the visit of this floating clinic, Indah Kiat Perawang also often appealed to the community in Lubuk Meriam Hamlet and other hamlets on the banks of Siak River to pay more attention to hygiene. The community is given the knowledge that health is not solely about taking medicines, but living a healthier way of life.

The conditions faced by the community in Lubuk Meriam Hamlet and other hamlets on the banks of Siak River, came to Indah Kiat Perawang’s attention. Since 2002 Indah Kiat Perawang has provided clean water supply by drilling wells.

Indah Kiat Perawang also built bathing, washing, toilet facilities(MCK), with the community’s active participation including for the operation and maintenance of the facilities. In addition to the toilets, Indah Kiat Perawang also provided zinc assistance for roof repairs of several residents’ houses. There was also assistance in the provision of rainwater storage tanks for clean water supply.

Along with the provision of toilet facilities and clean water, Indah Kiat Perawang also conducted awareness raising activities on hygiene promotion through dissemination and training for the community. The provision of toilet facilities, house renovation and clean water facilities were carried out by Indah Kiat Perawang (APP) in cooperation with Habitat for Humanity (HFH) Indonesia.

Floating Clinic

Clean Water Supply DEVELOPMENT OF TOURIST VILLAGE

Kampung Pinang Sebatang in Tualang District is one of the closest and influential villages in the early establishment of Indah Kiat Perawang. This is because Kampung Pinang Sebatang has a port which is the only route connecting Perawang and Pelawan. Thus, it does not come as a surprise if the village has always been packed with visitors queueing to cross Siak River by ferry.

Over time, the village became less crowded than it once was and the economy became sluggish, as the ferry operation halted following the construction of a new bridge. Seeing this condition, Indah Kiat Perawang held discussions with the community, community leaders and government to restore the community’s economy as before, even improve the welfare. Based on the results of the discussion, it was agreed to build a jogging track arena.

Indah Kiat Perawang started to build jogging track arena by setting the field. Working with the village administration in Kampung Pinang Sebatang, the company decorated the jogging track with park. With the jogging track and this park, now every day, especially in the morning and afternoon, this area in Kampung Pinang Sebatang is always visited by residents, especially on weekends.


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STUDENTS OF HIGHER EDUCATION DEVELOPMENT

The development of education in Siak Regency has been encouraging because it indicated improvement in the quality of human resources (HR). The number of school-age children who receive more access to school, including those who are in senior high school (SMA), has increased.

Most senior high school graduates in Siak Regency can not continue to universities, especially state universities (PTN). The main obstacle for them is the lack of funds, considering that Siak Regency does not have state university, so it requires a large amount of money to study at state universities in other regions.

This condition became a concern for Indah Kiat Perawang. The scholarship program is the mill’s initiative to provide long-term impact to the community. As an alternative solution and providing opportunities for senior high school graduates in Siak Regency to continue their education to state universities, Indah Kiat Perawang developed a scholarship program.

Through this scholarship program, Indah Kiat Perawang wanted to contribute to the joint efforts to improve the quality of human resources in Siak Regency, especially young people. Thus they will be able to compete to fill job opportunities in Siak Regency or creating new jobs to support regional economic growth.

Starting in 2002, the scholarship programme was originally focused on high school graduates around the mill site with outstanding achievements and had been admitted to the state universities, but has limited funds. In the following period, the program was extended to all areas in Tualang District and other areas in Siak Regency. To date, there have been 179 students became beneficiaries and continue their education to their respective state university.

The residents’ enthusiasm to use the jogging track built by Indah Kiat Perawang is in line with local government plans to build new tourist attractions. After the jogging track management was handed over to Kampung Pinang Sebatang, the village administration employed workers for cleanliness and maintenance of the park. In addition, several plans have also been prepared to develop the tourist attraction. The plan will be run by the Local Government with a multi-stakeholder collaborative system. Based on the results of discussions with the government, Indah Kiat Perawang was chosen to contribute in supporting development of this program. The development included increasing the number of large-sized shade trees, making futsal court and building a foodcourt.

The arrival of visitors that grew substantially has boosted new economic activities around the tourist area. In the future, a foodcourt will be built to accommodate the existing stalls to be more organised. The area will also be equipped with various other playground. Thus, the positive impact of jogging tracks continues into the development of economic centres through tourist villages. In the long run it is expected that this situation will become the foundation for the development of regional economy that is self-reliant and capable of improving the welfare, thus supporting the achievement of sustainable development goals.

New Tourist Attraction

Revival of Community Economy


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The selection process for senior high school graduates as beneficiaries of the scholarship program started with a screening process through try out test, which was announced through the local mass media. From the initial selection process, a total of 30 participants with the best test scores and interviews were selected. They then attended examination guidance class in one of study centres in Pekanbaru, for 40 days.

The participants then took the national selection examination to enter public universities (SMPTN). Participants accepted at the state universities then received a scholarship in the form of tuition funds of Rp200,000 per month and Rp1,200,000 per semester. The educational assistance was provided for 9 semesters, with condition that they must obtain Grade Point (IP) of at least 2.50 of maximum scale 4.0 in each semester.

One of the participants who received the tuition fee assistance from this program was Jesika Rahayu Lestari, who studied at the Faculty of Medicine, University of Riau (Unri) and graduated as a medical doctor in December 2015. Currently, Jesika is attending an intensive service internship at Dumai Hospital for a year. The success in her education became a pride of Tualang Village because they have a doctor originated from their own village.

Selection Process

BUILDING ACCESS TO CLEAN WATER

The problem of clean water becomes one of the crucial problems faced by the community in Perawang and other areas in Tualang District, Siak Regency. This condition is partly due to the type of soil in Tualang, which is peatland, that the water withdrawn from the shallow wells is unfit for consumption.

The difficulties in accessing clean water came to Indah Kiat Perawang’s attention, which was followed by the implementation of clean water supply assistance program for the community. This program began to be implemented in 2003, with the assistance in making wells for 60 hand pumps in the villages around the mill.

In the following development, Indah Kiat Perawang built water wells operated by electricity as well as supporting facilities. The construction of the wells was integrated with schools, mosques or prayer rooms as well as with residents’ housing area.

The wells and their facilities were built with the involvement of local community. Their involvement continues when the water wells have been operated, through independent maintenance contribution.

Until the end of 2016 Indah Kiat Perawang has built water wells and supporting facilities in 10 villages around the mill. The water wells have provided the residents in these villages with access to clean water for their daily needs.


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