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of clove trees and improve their yield and performance. The Company expects to establish its first trial through a cooperation agreement implementing the CIS program by the end of 2015.
Paper and Packaging
The Company purchases paper and packaging related materials primarily through global procurement arrangements between PMI and suppliers. The cigarette paper used by the Company is supplied by PT Bukit Muria Jaya and PT
Pusaka Prima Mandiri Indonesia, who watermark the paper with the Company logo. Tipping paper is supplied to the Company by Benkert Malaysia Tann Philippines, whilst cigarette packaging material, composed of cardboard and
polypropylene, is purchased from various suppliers. Filters
The Company purchases raw material filters such cellulose acetate from several companies, such as Daicel Japan and Eastman Korea and the United States through global procurement arrangements through PMI. The Company
processes the raw material into filters in accordance with the size of the cigarette to be produced. Flavorings
The Company purchases flavorings, known as sauce or casing, from the PMI flavor production center and from local suppliers, who in turn obtain their supply from several international flavoring suppliers. The Company has always
prioritized the taste authenticity of tobacco leaf and clove so its products are of a low sauce variety, known in Indonesia as pure blends.
Storage
The Company stores its raw materials in nine warehouses at different locations, five of which are located in West Java and four in East Java
J. ENVIRONMENT
The Company is subject to applicable national and local environmental laws and regulations in Indonesia. Environmental protection in Indonesia is governed by various laws, regulations and decrees.
The granting of an Environmental License is based on either i an environmental feasibility decision approving the AMDAL based on the recommendation of the AMDAL Assessment Commission Komisi Penilai Amdal, that is issued
by the Minister of Environment, governor, mayor or regent as applicable or ii a recommendation of UKL UPL issued by the appropriate Government or regional government institution responsible for environmental management and
control of the relevant area.
In addition to the Environmental Permit, Law 322009 also requires permits relating to environmental protection and management such as permits for all waste disposals, storage and handling activities, including those for hazardous
waste. Waste disposal may only be conducted in specified locations determined by the State Minister of Environment. Waste water disposal is further regulated by Government Regulation No. 82 of 2001 on Water Quality Management and
Water Pollution Control. This regulation requires responsible parties to submit reports regarding their disposal of waste water detailing their compliance with the relevant regulations. Such reports are to be submitted to the relevant mayor or
regent, with a copy provided to the State Minister of Environment, on a quarterly basis.
The Companys production facilities are ISO:14000 Environment certified. The Company also has specific programs across its business units designed to meet applicable environmental compliance requirements and reduce its carbon
footprint and wastage as well as water and energy consumption. Waste resulted from Company’s production activities
in the form of solid waste are entirely handled by third .The Company has developed and implemented a consistent environmental and occupational health, safety and security management system, which involves policies, standard
practices and procedures at all its manufacturing centers. The Company also conducts regular safety assessments at its offices, production facilities and warehouses. The Company assesses and reports the compliance status of all its
legal entities on a regular basis based on the management and controls it has in place and its review of climate change.
The Company also encourages clove tree rehabilitation through provision of free clove seedlings to local farmer communities through its programs pertaining to Good Agricultural Practices. The Company also cooperates with its
tobacco suppliers, including its major supplier, PT Sadhana, on encouraging reforestation programs.
K. CORPORATE SOCIAL RESPONSIBILITY The Company is committed to carrying out sustainable corporate social responsibility CSR programs and to
sustainable social investments that benefit its employees and business partners, the environment, and the communities where it operates and sources tobacco leaf and clove.
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In carrying out this commitment, the Company promotes its contributions and CSR initiatives under its signature program, Sampoerna Untuk Indonesia Sampoerna for Indonesia, which drives its various initiatives focused on access to
education, economic opportunity, empowering women and disaster relief and preparedness, along with its other social responsibility activities.
The Company also believes in a partnership approach by having strategic, long-term partnerships with corporate, community, government, civil society organizations, universities and other key stakeholders and collaborates directly via
its Sampoerna Volunteers Club SVC. Through the SVC, its employees have the ability to take an active role in various initiatives addressing economic, educational, social, and environmental issues.
Each year, the Company provides scholarships for the children of Sampoerna employees. The Company has distributed approximately 4,300 scholarships to elementary and secondary level students and approximately 600 scholarships
andor financial assistance packages for university students, aimed at encouraging employees to play an active role in encouraging their children to continue on to higher education. The Companys support for educational programs is
heavily concentrated in the areas where the Company sources tobacco leaf and clove, which approximately 9,600 people have participated in, and has expanded its focus on specific education programs pertaining to the Companys Good
Agricultural Practices and Agricultural Labor Practices initiatives. Moreover, approximately 71,000 people have benefited from Sampoerna Corner, an initiative within eight university campus libraries that provide an engaging environment for
students to access knowledge resources.
The Company supports the attainment of individual and community financial independence through participative empowerment programs. The Company has established the Sampoerna Entrepreneurship Training Center SETC,
on a 27 hectare site in Pasuruan, East Java and since its establishment in 2007 SETC has been visited by approximately 55,000 people. SETC has been acknowledged by the Ministry of Cooperative and Small and Medium Enterprise as a
National Entrepreneurship Driver in developing small business start-ups. In total, SETC has trained approximately 22,000 people including 9,300 tobacco farmers and 3,300 start-up small and medium enterprises.
The Company also supports a number of initiatives for women such as community training programs for women on healthy living, financial literacy training and other learning program initiatives and has also established the Sampoerna
Rescue Team in 2002, followed by the establishment of Sampoerna Rescue Training Center in Pasuruan, East Java in 2012 to support public preparedness in the face of natural disasters. The Companys efforts to empower women have
benefited approximately 3,700 women through the community training programs and 2,300 women through small and medium enterprise training.
The Companys disaster relief and preparedness efforts include Sampoerna Rescue, a search and rescue training centre, as well as a tsunami early warning system program, which has benefitted approximately 270,000 people,
humanitarian missions, which have benefited approximately 75,000 people, and free medical services, which have benefitted approximately 52,000 people.
L. AWARDS
