Sustainability Report and Creating Shared Value (CSV):

Sustaining a Business of Urea Fertilizer Manufacture

in the Case of Pupuk Kaltim Indonesia

Eko Ganis Sukoharsono *)

and
Dyah Ayu Widhayati

Accounting Department
The University of Brawijaya, Indonesia

*) Email: eg.sukoharsono@ub.ac.id and ekoganis@gmail.com

Presented at: SIBR-RDINRRU 2017 (Sydney) Conference on Interdisciplinary

Business and Economics Research, 15th - 16th April 2017, Sydney, Australia.

ABSTRACT
Pupuk Kaltim is the biggest Urea fertilizer manufacturer in Indonesia, and producing ammonia
and NPK fertilizer. Pupuk Kaltim provides national need of Indonesia of fertilizer both for the
subsidized or non-subsidized sector. In its activities, Pupuk Kaltim emphasizes its claim to the
importance of running an eco-friendly industry that would provide added values to the
surrounding communities. The objective of the study is to explicate the implementation model
of creating shared value (CSV) to the surrounding community of Pupuk Kaltim and its
relevance to their core of businesses, and its compliance to Global Reporting Initiative (GRI)
Standard. The study uses qualitaive research method with Forum Group Discussion (FGD) and
content analysis model based on the official published reports by Pupuk Kaltim: Sustainability
Reports, Annual Reports, Financial Report and Program Reports of Partnership and
Community Services.The study uses the reports audited and ended by 2015.

The results of the study reveal that Pupuk Kaltim complies with the GRI standard for their
Sustainability Reports. The study finds that there are several aspects in the GRI standard
which are not presented yet as the management has chosen by “core in accordance”. The study
also finds that Pupuk Kaltim implements the CSV relevance in many aspects of the GRI
standard. The CSV relevance can be found in the aspect of environment such as reducing the
emissions, reducing energy usage, and waste treatment. In the social aspects of the CSV
relevance, Pupuk Kaltim shares their values by providing education training to the commucity,
health and safety facilities. Additionally, the CSV relevance based on the Program Report of
Partnership and Community Services is reflected on the provision of capital for the trained
partner in agricultural, fishery, and animal husbandry. Lastly, Pupuk Kaltim has a strong
commitment in building CSV relevance to the community surrounding, such as building public
infrastructures, health facilities, and providing education scholarship for the society.

Keywords: Sustainability Report, Creating Shared Value, and Sustainability Accounting