Enhancing Social License to Operate Through Stakeholder Engagement and Governance at PT Freeport Indonesia
DOI:
https://doi.org/10.46799/adv.v4i10.728Keywords:
Stakeholder Engagement, Social License To Operate, Governance, Customary Institutions, Community Relations Mining IndustryAbstract
This study examined (1) the underlying causes of stakeholder dissatisfaction with PT Freeport Indonesia's (PTFI) community development programs, (2) aspects of program implementation and stakeholder engagement requiring improvement, and (3) strategies PTFI could adopt to align stakeholder expectations with program implementation. A descriptive qualitative case study design was employed, drawing on semi-structured interviews with ten informants representing PTFI management, YPMAK, LEMASA, LEMASKO, community and church leaders, and local interest groups. The interviews were supplemented by company documents and grievance records. Data were analyzed using Braun and Clarke's (2006) six-phase thematic analysis framework, integrated with Mendelow's stakeholder mapping framework, gap analysis, and Zadek's (2004) corporate responsibility maturity model. The analysis generated 20 codes, six themes, and three key issues, revealing that stakeholder dissatisfaction stemmed primarily from the unequal distribution of program benefits, challenges to the legitimacy of LEMASA and LEMASKO, and transactional stakeholder engagement practices lacking formal community feedback mechanisms, rather than solely from program ineffectiveness. PTFI was assessed as operating at the managerial stage of corporate responsibility maturity, with indications of progression toward the strategic stage. The study proposed a five-year action plan comprising four implementation phases and highlighted the importance of engagement quality, rather than the volume of social investment alone, in strengthening and maintaining a social license to operate within an Indigenous community mining context.
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