How Important CSR to Mining Companies: Empirical Case in Indonesia

Abstract

The role of CSR is crucial to building a company’s brand strategy, especially companies that exploit natural resources. Branding is crucial for products and services sold in big consumer markets. It’s also important because it helps companies stand out from the competition. The brand strategy brings competitive positioning to life and works position as specific “something” in the mind of customers. The purpose of this paper is to describe the nature and trend of nonfinancial disclosure corporate social responsibility (CSR) practices in Indonesia. The sample of the study consist of annual report of the mining companies listed at Indonesia Stock Exchange during 2015-2017. CSR indexes and financial performance measures were computed for content analysis. This research result shows that 39 mining companies in Indonesia globally do CSR on their companies, but not all of the company’s CSR activities are disclosed in the nonfinancial report. The disclosure level of CRS in mining company is many as 0,3303. This happens because the company reporting on social responsibility and also identify the advantages they have gained through disclosing their social responsibility activities to stakeholders. Which complete information is the foundation for stakeholders to determine the decisions related to the company. The conclusion of the analysis of mining company CSR report disclosed in the annual report of the company can conclude that there are three reasons why a company conducts CSR, among others: The company complies with national policies; Minimizing social, economic, political and environmental impacts; and Value Creation.