Sunday, March 14, 2010

Freeport Indonesia's 'franchise' CSR program

PT Freeport Indonesia, the largest mining company in Indonesia's Papua province, introduced social entrepreneurship for local businesses as a corporate social responsibility program in 2004. The franchise design was chosen for technical training and systemised marketing of micro, small and medium enterprises (PP-UMKM), Laurens Woda, PTFI's Program Section Head, told Info Franchise.

Its focus is on management and entrepreneurship with self-reliance being addressed on a daily basis. Training is given periodically mainly on subjects concerning business management and franchising.

In research and development, assistance is provided to identifying business opportunities and analysing feasibility studies for potential businesses under the UMKM program.

Loans or revolving funds are given to businesses which have adequate business plans but are not sufficiently qualified for bank loans.

”This also serves as an educational tool, namely to give instruction how to meet a bank’s terms and conditions and what to do when the terms and conditions have been met,” Woda said. Disbursing of the actual loans is carried out by Yayasan Bina Utama Mandiri, a foundation set up by PT Freeport Indonesia.

PFI's focus is the Papuan community living around the working in its contract area. This is in line with PT Freeport Indonesia’s CSR commitment. The criteria for citizens to qualify for assistance is having a business and residing in Mimika regency.

Franchises running well and growing are Roto-Rooter and OMI (Outlet Mini Indogrosir). Roto Rooter provides maintenance for pipes inside PTFI’s operational area. ”Roto-Rooter’s franchise which is owned by Anastasia Tekege has been running well for the last four years and has 67 employees on its payroll,” Woda explained

PTFI’s PP-UMKM program is also looking at other franchises including drugstores, retail shops, car repair shops, educational and entertainment businesses.

1 comment:

Mehrdad said...

This looks like an interesting approach to accelerate and scale up local economic impacts. I wonder if Freeport has also tried similar approaches at some of its other major operations, such as Tenke in DRC.
Mehrdad (www.prizmablog.com)