Caring to the community welfare

The Company believes that business success is not merely measured upon financial achievement, but also upon the benefit enjoyed by the community, especially those who reside within the Company's operational area and its surroundings. In line with the principle, in the efforts to uphold good corporate governance (GCG), the Company strives to continually improve the implementation quality of its corporate social responsibility (CSR).

During the year 2007, the Company and its subsidiaries have been actively participated in programs targeted at communities in the vicinity areas of its operational jurisdiction. The Company's holistic approach to the development of community welfare implies that it is not only limited to incidental momentary aid but also intends to convey a much wider aspect of human virtues. The CSR programs encompass health care, education, competence enhancement, environmental management and other programs, with a total expense of Rp6.9 billion, increasing 13% from Rp6.1 billion in 2006.

The Company sees this as social investment, considering its role as public company and responsible business entity. The CSR scheme is not only beneficial to the people, but also helps to promote the good image of the Company whilst strengthening the foundation of a conducive atmosphere for future business growth.

The role of environment health and safety (EHS) as well as social responsibility (SR) in the Company's operation is of premium importance. Apart from rising demand caused by global market development that brings forward these aspects, awareness of the Company as well as demand from customers have also become the main measure. In several points of operation, the occurrence of accidents, does not merely inflict losses, but can affect delay in Company operation, either due to prevailing regulations or the obligation to carry out investigation to identify the fundamental causes and necessary corrective action in order to prevent reoccurrence of similar or even worse accident. Social unrest from local community or employee who are dissatisfied with the Company's certain action may also disrupt operation. For these reasons, EHS and SR programs become more important than ever.

Basic Values

In the Company's mission, it has been clearly stated that the Company should become an entity that creates sustainable value for the stakeholders by striking a balance between economic, social and environmental issues.

Since 2001, activities of community development scheme had been carried out by the Company. The Company had also implemented the principles of Triple Bottom Line that foster the harmony of economic aspect, environmental aspect and social aspect.

In order to ensure the effective implementation of AGC management system, each installation has to be carried out and monitored on a regular basis. Assessment is performed either by way of self-assessment, crossassessment within the Group, or by third party, similar to the requirements used by the Astra Group. Furthermore, final report from the assessment will be linked to the performance management and becomes part of the Company's overall evaluation. Rating of the AGC achievement status is represented in color code, from highest to lowest level: “Gold”, “Green”, “Blue”, “Red”, and “Black”.

The management have established the policy that in order to achieve the best execution in branches, sites and subsidiaries, there are four essential steps to conduct, which are the establishment of task-force or executive board, infrastructure preparation, assigning top management as action drivers, and conducting communication and networking with all stakeholders.