The Freeport Mine, Irian Jaya,

Indonesia: Tailings & Failings

Stakeholder Analysis
Syndicate 5
Akhmad Dwi Riyanto 29116011
Gemma Grimaldi 29116223
Siti Fadilah Ristekawat 29116122
Muhammad Daniala Syuhada 29116059
Who are PT. FI stakeholder ?
RTZ (Shareholder and Investor of FCX)
Freeport McMoran (FCX) and it shareholder
PT. Indocopper Investama
Indonesia Government
Investment Insurance Company (OPIC and MIGA)
Local Tribe (Amungme and Kamoro), NGOs (Walhi,
International Rivers Network, etc)
Employees of PT. FI (Local 30%, expatriat & Other
Indonesian citizen)
 88,6% RTZ
PT
49%
11,4%
Indocoppe
r
Investama 9,36% 81,28%

20% New
9,36% Smelt
er
Contract of
What are PT. FI stakeholders
stakes?
RTZ
Legitimacy -> has 11,4% share of FCX, long term contract with Indonesian
Goverment
Power -> able to push the FCX management and stop investment contract
Urgency -> need to return their investment (high)

FCX (Public and RTZ)

Legitimacy -> has 81,28% share of PT. FI and regulator
Power -> able to push the PT.FI management and to stop contract
Urgency -> Need PT. FI to produce ore as targeted (high)

PT. Indocopper Investama

Legitimacy -> has 9,36% share of PT. FI
Power -> -Stop Investment
Urgency -> Need PT. FI to produce ore as targeted and give dividend as
expected (Medium)
What are PT. Fi stakeholders
stakes ?

Indonesia Government (as regulator and shareholder)

Legitimacy -> has 9,36% share of PT. FI
Power -> regulate the rules in Indonesia
Urgency -> need PT. Fi to pay the royalty and give
dividend in order to fulfill the State Budget

Investment Insurance Company (OPIC and MIGA)

Legitimacy -> investment insurance of PT. FI, needed to
attract the investor
Power -> able to push the PT. FI to follow the rules
Urgency -> need PT. FI to doing business in proper way
to minimum the risk
What are PT. FI stakeholders
stakes ?
Community (Local tribe, NGO, etc)
Legitimacy -> as local people, already existed before PT. FI came
Power -> able disturb the sustainability of PT. FI business, their
voice are heard by the International community, could distract
the investor of FCX
Urgency -> need PT. Fi to doing business in proper way to ensure
the environmental sustainability and need to be empowered by
PT. FI

Employees of PT. FI
Legitimacy -> as employee, the operation of PT. FI depend on
them
Power -> able to strike if their needs are not fulfilled
Urgency -> their welfare, health and safety need to be fulfilled
 What Opportunities and Challenges
do Stakeholders Present?

Stakeholders Opportunities Challenges

RTZ (Shareholder and - Dividend Lobby with Indonesian
Investor of FCX) Government
Freeport McMoran - Dividend Lobby with Indonesian
(FCX) and it Government
shareholder
PT. Indocopper - Dividend Stock price fall
Investama
Indonesia Government - Economical growth - Environmental
- East Indonesia pollution
development - Natural resources
scarcity
Investment Insurance Insurance premium Stop assurance when
Company (OPIC and environmental issues
MIGA) arise
 What Opportunities and Challenges
do Stakeholders Present?

Stakeholders Opportunities Challenges

Local Tribe - Local Environmental
(Amungme and Infrastructure damage
Kamoro), NGOs development
(Walhi, International
Rivers Network, etc)
Employees of PT. FI Wealthness Bad impact to
employee health
 What Responsibilities Does a
Firm Have to its Stakeholders?
Stakeholders Economic Legal Ethical Philantropic
RTZ Gain Profit Follow the
regulation
Freeport Gain profit Follow the
McMoran (FCX) regulation
and it
shareholder
PT. Indocopper Gain Profit Follow the
Investama regulation
Indonesia Economic growth Tax income Infrastructure Donation for
Government Development and Job Indonesian Army
opportunity for local
people
OPIC and MIGA Insurance Environme
premium nt
regulation
fulfillment
Local Tribe, Environme Sponsorship for Scholarship for
NGOs nt Community Activity Local People
regulation
fulfillment
What strategies or actions should the
firm take to best address stakeholder
challenges and opportunities ?

Stakeholders Potential for Threat to

High Organization Low

PT. FI, Investor,

High Government
Employees
Strategy:
Strategy:
Stakeholders Involve
Collaborate
Potential for
Cooperation
With
OrganizationLow Insurance Local Tribe, NGO
Strategy: Strategy:
Defend Monitor