Climate Change Data

Environmental Metrics

ESG Focus Areas

• Preserving the Environment
• Ensuring “Everyone Safe, Always”
• Empowering Our People
• Caring for Communities
• Respecting Human Rights
• Adopting Good Corporate Governance

Environmental Achievements

• BSI: 10% reduction of scope 1 GHG emission and 50% reduction of scope 2 GHG emission compared to the previous year
• BKP-BTR: 5% reduction of scope 1 GHG emission compared to the previous year
• BSI recycled 702 megaliters of water or 7% of total water use for ore processing
• BSI reused 8,905.9 megaliters of water or 93% of total water used from the ADR facility for ore leaching
• BSI reduced waste oil, oily rags, and e-waste, and converted felled trees into approximately 15 tons of compost
• BKP-BTR converted domestic waste and cardboard into 4.56 tons of compost, and used domestic waste for animal feed livestock and maggots farming for poultry feed
• BSI conducted land reclamation on 4.19 ha and planted 8,233 trees for revegetation
• BKP-BTR conducted land reclamation on 3.11 ha and planted 1,944 trees for revegetation
• ISO 14001:2015 audit certification has been reissued for MCG, BSI, BKP, BTR, MMS and Pani

Social Achievements

• Zero fatalities for all Merdeka’s employees and contractors’ employees
• 43% of heavy equipment operators at BKP-BTR are women
• Human rights training for more than 50% of security personnel at BKP-BTR
• 131,861 training hours for employees or 15.9 training hour per employees
• Disbursed USD 3.4 million for community development and empowerment programs
• Established Female Forum at PT Sulawesi Cahaya Mineral (SCM)

Governance Achievements

• Merdeka’s MSCI ESG rating upgraded to “BBB”
• BoD members participated in sustainability trainings
• BoD and BoC’s pay is linked to sustainability
• Code of Conduct (Code of ethics) training provided for 875 Merdeka’s employees
• Code of Conduct training provided for 80 representatives of Merdeka’s contractors and suppliers
• Sustainability Policy and Supplier Sustainability Code of Conduct are developed and published
• Contractor Management System (CMS) Standard developed with requirement on health and safety, environmental, social and governance

Climate Goals & Targets

Environmental Challenges

• Climate change
• Supply chain disruptions
• Community engagement
• Maintaining a safe working environment

Mitigation Strategies

• Developed GHG emission reduction roadmap
• Implemented energy substitution and energy efficiency measures
• Rehabilitated land
• Implemented offsetting programs
• Developed Supplier Sustainability Code of Conduct
• Implemented Contractor Management System (CMS)
• Regular stakeholder engagement
• Continuous OHS training and improvement

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Supplier Sustainability Code of Conduct
• Contractor Management System (CMS)

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Development of energy-efficient products and renewable energy sources

Reporting Standards

Frameworks Used: GRI Standards 2021

Certifications: ISO 14001:2015, ISO 45001:2018, ISO 9001:2015

Third-party Assurance: TUV Rheinland Indonesia

UN Sustainable Development Goals

• SDG 1
• SDG 3
• SDG 5
• SDG 6
• SDG 8
• SDG 12
• SDG 13
• SDG 15
• SDG 16
• SDG 17

Merdeka’s Six Sustainability Strategy Pillars align with these SDGs, focusing on economic growth, health, gender equality, clean water and sanitation, decent work, responsible consumption and production, climate action, life on land, peace, justice, and strong institutions, and partnerships for the goals.

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• MSCI ESG rating upgrade to BBB
• Inclusion in MSCI Indonesia ESG Leaders Index
• Leader in Sustainalytics ESG risk rating
• Constituent of ESG Sector Leaders IDX KEHATI index
• TrenAsia ESG Excellence 2022 (Action Silver award)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Health and Safety
• Human Rights
• Community Development
• Responsible Supply Chain
• Good Corporate Governance
• Diversity, Equity, and Inclusion

Environmental Achievements

• 52% reduction in groundwater at BSI
• 1,233 and 21.9 megaliters of water recycled at BSI and SCM respectively
• 9,790.3 megaliters of water reused at BSI
• 100% of electricity used at BSI sourced from PLN renewable energy
• 16.17 ha land reclaimed
• 9,873 tree seedlings planted
• Upgraded MSCI ESG rating to 'A'

Social Achievements

• Zero fatalities for all Merdeka’s employees and contractors’ employees
• LTIFR of 0.09
• USD 3.07 million disbursed for community development and empowerment programs
• Human rights training for 50% security personnel at SCM and 48% at MTI
• 193,862 training hours for employees (17.67 training hours per employee)
• Employer of Choice Award from SWA Magazine and Stellar Workplace Award from Harian KONTAN

Governance Achievements

• Board’s oversight of sustainability commitment implementation
• BoD and BoC’s pay linked to sustainability
• Code of Conduct training provided to 41% of Merdeka's employees and 434 representatives of suppliers and security providers
• Anti-corruption and anti-bribery training for managers, general managers, executives and directors
• 69% of major contractors screened using Contractor Management System (CMS) indicators

Climate Goals & Targets

Environmental Challenges

• Climate change risks (transition and physical risks)
• Supply chain disruptions
• Maintaining harmony and integration between work and personal life of employees
• Continuous employee development, performance assessment, and competitive compensation

Mitigation Strategies

• Energy substitution and efficiency
• Establishing governance, engagement, and disclosure to ensure climate change risks and opportunities are considered in business decision-making
• Assessing and managing climate change risks and opportunities using TCFD guidelines
• Developing alternative sourcing strategies
• Implementing employee engagement programs (Merdeka Happy Home)
• Implementing programs and initiatives to address challenges in employee development, performance assessment, and competitive compensation

Supply Chain Management

Supplier Audits: 69% of major contractors screened

Responsible Procurement

• Supplier Sustainability Code of Conduct
• Contractor Management System (CMS)

Climate-Related Risks & Opportunities

Physical Risks

• Flooding
• Storms
• Sea level rise
• Extreme heat

Transition Risks

• Carbon tax implementation
• Increasing raw material prices
• Transition to lower carbon technology
• Reputational risks

Opportunities

• Resource efficiency
• Renewable energy sources
• Product development for low-carbon economy

Reporting Standards

Frameworks Used: GRI Standards 2021, GRI Mining and Metal Sector Disclosures, TCFD, UN Global Compact

Certifications: ISO 14001:2015, ISO 45001:2018

Third-party Assurance: TUV Rheinland Indonesia

UN Sustainable Development Goals

• SDG 1
• SDG 3
• SDG 5
• SDG 6
• SDG 8
• SDG 12
• SDG 13
• SDG 15
• SDG 16
• SDG 17

Explanation of alignment with SDGs found in section 3.5

Sustainable Products & Innovation

• Nickel for electric vehicle batteries

Awards & Recognition

• MSCI ESG rating 'A'
• Sustainalytics ESG risk rating improvement
• Gold Rank at ASRRAT 2023
• TrenAsia ESG Award for Action Nickel
• Employer of Choice Award
• Stellar Workplace Award
• Tamasya Award 2023
• DetikJatim Awards 2023