The triumphal of Environmental NGOs

The battle between environmental NGOs and natural resources companies entered a new chapter when the new law no. 40/2007 was applied last year.

Although the business community saw it as a failed act, the environmental and social community-empowerment NGOs saw it as a right move. The law can be considered as the triumph of environmental NGOs against the natural resources companies according to Zainal Abidin from Indonesia Legal Aid Foundation.

Andika Gunadarma from Hukumonline.com who monitors laws passed by legislators said that law No. 40/2007 has been anticipated since 2005 because the Indonesian business society needed a new law to replace law No. 1/1995 on perseroan terbatas (finite company)

He explained that the new law gives better details about the rights and responsibilities of company directors and commissioners. It was also created to embrace the principles of good corporate governance, business ethics, anti-corruption, and e-government. However, he never anticipated CSR (Corporate Social Responsibility).

Echoing with Andika, Imam Nasima from the Indonesian Centre for Law and Policy Studies told the Globe that the first draft of the Laws No. 40 did not initially have article 74 regarding CSR matter.

It was later included in the final draft by the special committee of DPR chaired by Akil Mochtar from Golkar. Mochtar confirmed that the commission decided to include the CSR matter in the final draft because it thought that this matter must get more attention from natural resources companies.

By including the CSR matter in the law they hoped that in the future, there will be no more cases like those concerning Newmont Minahasa or Lapindo.

The Indonesia Business community, represented by the Indonesian Chamber of Commerce and Business Watch Indonesia, objected to several articles in the law especially article 74 because they thought that it would limit their business activities.

They argued that CSR was simply voluntary acts which should not become obligatory. The argument was also backed by Srie Redjeki, a professor of civil law from the Diponegoro University, she stated that the law was not good for business and the incorporation of the CSR matter in the law was inappropriate since moral responsibility should never become legal responsibility.

On the contrary, Fathi Ahmad from the Natural Resources Law Institute and Jalal from CSR Circle Studies embraced and praised the law while Siti Maimunah from Mining Advocacy Network also void support for the law, saying that companies must be pressured to heed concerns about environmental rehabilitation.

Since the concept of CSR was first introduced in the 1960s by the big wave of environmental movement in the west, it has been well recieved and praised by the world including Indonesia. Furthermore, the Indonesian government has taken a further step by including the concept into the law no.40/2007, an act that considered by many as being a first for the world.

(sumber : smashingyoungman)