In an era of growing environmental consciousness, PROPER (Program Penilaian Peringkat Kinerja Perusahaan dalam Pengelolaan Lingkungan Hidup) emerges as a compass for businesses in Indonesia to achieve environmental sustainability. This article takes you on a journey through PROPER, from its definition and benefits to its comprehensive mechanism.
Understanding PROPER: Embracing Environmental Sustainability
PROPER is an assessment program initiated by the Ministry of Environment and Forestry (KLHK) of the Republic of Indonesia. This is the primary regulation Peraturan Menteri Lingkungan Hidup dan Kehutanan Nomor 1 Tahun 2021 tentang Program Penilaian Peringkat Kinerja Perusahaan dalam Pengelolaan Lingkungan Hidup (PROPER) that establishes the PROPER program, defines its objectives, scope, and implementation procedures.
It outlines the criteria for assessing companies’ environmental performance, the rating system, and the roles and responsibilities of various stakeholders involved in the program.Designed as an incentive and disincentive instrument, PROPER aims to encourage companies to improve their environmental management performance.
The program evaluates companies based on aspects such as:
- Pollution and/or Environmental Damage Management: Evaluation covers air, water, and soil pollution, as well as B3 and non-B3 waste management.
- Natural Resource Management: The sustainable use of natural resources such as water, energy, and forests is assessed.
- Corporate Social Responsibility (CSR) Activities: The company’s contribution to the surrounding community and environment is analyzed.
Companies are categorized into five ratings:
- Gold: Best environmental management performance.
- Green: Good environmental management performance.
- Blue: Sufficient environmental management performance.
- Red: Environmental management performance needs improvement.
- Black: Very poor environmental management performance.
Reaping the Benefits of PROPER: Advancing Business Sustainability
PROPER not only promotes environmental sustainability but also unlocks various opportunities for businesses:
- Enhanced Reputation and Corporate Image: A good PROPER rating enhances public and investor trust in the company’s environmental commitment.
- Attracting Business Opportunities and Investments: Companies with high PROPER ratings are more attractive to investors and business partners focused on sustainability.
- Improved Operational Efficiency: Optimal environmental management can lead to cost savings and increased operational efficiency.
- Strengthened Stakeholder Relationships: Transparency and openness in environmental management through PROPER strengthen relationships with communities, NGOs, and the government.
PROPER Mechanism
The PROPER (Program Penilaian Peringkat Kinerja Perusahaan dalam Pengelolaan Lingkungan Hidup) assessment process involves a rigorous and comprehensive evaluation of a company’s environmental management performance. The mechanism can be summarized in the following key steps:
1. Participant Selection:
- KLHK identifies companies that significantly impact the environment, are listed on the stock exchange, or produce products for export or widespread public use as potential PROPER participants.
2. Data Collection:
- Self-reported data from companies through their Environmental Management Performance Summary Document (DRKPL) is gathered.
- Additional primary data is collected through direct field inspections conducted by Environmental Supervision Officials (PPLH).
3. Preliminary Report and Review:
- The collected data is analyzed to generate a preliminary report, evaluating the company’s performance in water, air, and hazardous waste management against PROPER criteria.
- This preliminary report indicates the company’s potential performance rating.
- The preliminary report undergoes peer review by a technical team.
4. Ministerial and Council Review:
- The peer-reviewed report is presented to senior officials at the Ministry of Environment and Forestry for comments and feedback.
- The report is then submitted to the Council for Consideration for their opinion and approval.
5. Objection and Finalization:
- The company and local government have an opportunity to raise objections and provide supporting data.
- The Council provides its final assessment of the company’s performance status.
6. Ministerial Decision and Public Announcement:
- The Minister reviews the Council’s assessment, makes a final decision on the company’s performance rating, and issues a policy statement.
- The company’s performance rating is publicly announced, communicated to the company, and shared with local governments.