Govt will sue only three polluting companies

Adianto P. Simamora ,  The Jakarta Post ,  Jakarta   |  Tue, 10/07/2008 9:57 AM  |  Headlines

Despite earlier announcing it would prosecute 43 of the most polluting firms in the country, the government now says it will only follow up on three companies.

State Minister for the Environment Rachmat Witoelar claimed many of the polluting firms had made significant progress in their environmental management policies, shortly after his office announced corporate environmental performance ratings in July.

The rating, called Proper, ranks companies on a color system, where gold is the highest, followed by green, blue, red and black. Companies rated black are those without water and air treatment facilities or environmental impact analysis (Amdal) documentation.

The ministry gave a black rating to 43 companies this year, with 13 making a second consecutive appearance in the bottom end of the list.

Ilyas Asaad, environmental management affairs deputy head at the ministry, on Monday said his office would make careful considerations before bringing polluting companies to court.

"First, we have to verify the Proper data in the field to see the latest developments, before taking them to court," he said, adding the ministry had verified 23 of the 43 companies concerned.

"We found three firms that have no intention of improving their environmental management. We are in the process of suing them," he said.

He refused to disclose which companies they were, saying only that one of them was a textile firm.

"The Proper rating is not a tool for punitive action. It is there to empower companies to comply with our environmental standards," Rachmat said.

"If companies can improve their environmental record after the audit, then we have achieved the purpose of the Proper."

Rachmat earlier vowed his office would take serious action to sue the 13 companies that were rated black two years running, as a wake-up call for other companies nationwide.

He also called on local banks to stop granting loans to the offending companies, and urged the Finance Ministry to impose disincentive policies such as higher taxes.

Following the 2005 Proper audit, the environment ministry also talked tough about prosecuting polluting companies, but no action was taken. That year, 72 of 466 firms assessed in the audit were rated black.

This year's Proper featured 517 companies, including those in the mining, oil and gas, manufacturing, and pulp and paper sectors. Corporate participation in the audit is voluntary.

The ministry gave red ratings to 85 companies, and the gold rating to one company.

The Proper rating has long been decried by activists as ineffective in improving corporate environmental responsibility, unless backed by strong government action, including annulling business permits of companies with poor environmental records.

Berry Furgan, executive director of the Indonesian Forum for the Environment (Walhi), said the ministry was "too lenient" in dealing with polluting companies operating in the country.

"Since the beginning, we knew the ministry would not dare to sue the (black-rated) companies," he said.

He added many companies in the Proper report were not eligible for green credit, saying the rating system seemed to benefit polluting companies by improving their image.

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