By Robin Hicks
Muchtazar, who like many Indonesians goes by one name, says he joined Nickel Industries Limited because he wanted to work for a company that not only turns a profit, but has a positive environmental and social impact.
His employer, according to the company’s website, is the lowest cost nickel company with the lowest carbon intensity. The Australia-listed firm owns a portfolio of mining and low-cost downstream nickel processing assets in Indonesia, and at the COP28 climate talks in 2023 committed to half its carbon intensity by half by 2035 and achieve net zero by 2050.
But the company operates in a sector under growing scrutiny for its environmental and social impact. The world’s largest, Indonesia’s nickel industry produced almost 60 per cent of global output last year. But mining the metal is now the country’s leading cause of deforestation, having overtaken oil palm in recent years, and has been linked to soil degradation and water pollution in the provinces where nickel mining is concentrated: Maluku, North Maluku, and Sulawesi, where Nickel Industries’ 5,983-hectare Hengjaya mine is located.
Muchtazar is almost four years into his role running Nickel Industries’ sustainability team. The company’s first sustainability hire, Muchtazar is now part of a team of three. He describes himself as a purposeful but pragmatic executive. “We can’t deny that the extraction process is needed for various metals, including nickel, since we don’t have enough yet in circulation to fully rely on recycling,” he told Eco-Business.
The former Unilever Indonesia sustainability professional says he hopes more companies in Indonesia prioritise sustainability and assign sustainability professionals with enough clout to enable them to make decisions at a senior level. “The role should go beyond reporting and compliance to truly transform the business into one that is more responsible and transparent,” he said.
A big part of his role involves convincing colleagues in other departments of the merits of sustainability in an industry that, in Indonesia, has taken a mixed approach to environmental, social and governance (ESG) principles. Here is how Muchtazar’s typical working day breaks down.
5:00am: I start the day with a short prayer, followed by some brisk morning exercise to get energised. I prefer to exercise indoors in my house in Tangerang, on the west side of Jakarta. I don’t tend to exercise outdoors, because it’s usually too hot and the air is not always clean.
Over coffee, I scan the web for global ESG stories. I try to stay on top of regulatory and standards developments in the mining and metals sector, as well as geopolitics – nickel is a commodity that is heavily influenced by global supply and demand dynamics, as well as government policy. Tariffs introduced by the United States earlier this year hit nickel prices globally. When the tariff was announced, the price dropped. When the tariff was paused, the price rebounded. I have to be on top of critical market developments like these, which could make or break my day.
8:00am: During my commute through Jakarta’s morning bustle, I tune into podcasts on responsible mining. It’s a chance to stay connected with evolving industry narratives. The ride becomes a mobile classroom. Recently, I learned about the Nickel Mark, a new and significant framework in responsible metals production launched in 2022. It was born out of a similar framework developed for copper producers called Copper Mark. Nickel Mark can be applied to both mines and refinery facilities. It assesses producers against 33 ESG criteria and gauges how well they are aligned to international sustainability standards. The previous standards were often only applied either to the upstream or downstream operations. The new system is suitable for my company’s operations, as we’re an integrated nickel producer involved in mining as well as processing.
10:00am: At the office, the morning picks up pace. I lead coordination meetings with my sustainability team, review disclosures and communication strategies. Clarity and consistency in how we communicate sustainability is just as important as the work itself.
The ESG maturity of nickel companies in Indonesia varies considerably. Some are still in their infancy. Others are well developed. Nickel Industries’ sustainability strategy encompasses three areas: sustainable operations, contributing to global sustainability and stimulating local economic development.
12pm: I have lunch with colleagues from other departments, such as finance, human resources, exploration, business development and legal. Different departments play a critical role in embedding sustainability across the organisation. Sustainability should not be a siloed function. Recently, I shared insights with my colleagues on how sustainability can give a business a competitive edge. This led to a conversation about how companies with strong sustainability credentials can attract more investment and sell to jurisdictions with higher ESG due diligence criteria.
1pm: The early afternoon is spent addressing pending issues and ensuring our sustainability commitments are on track. We have to ensure our intentions translate into action. The industry is facing a number of challenges, such as its high carbon footprint (nickel factories in Indonesia are mostly coal-powered) and low prices.
Finding a balance between sustainability and profitability is always a challenge in this business. So we need to find the right solutions, and often that comes through collaboration. For example, a partnership with industry associations to develop ESG standards relevant to the Indonesian context is essential. Adopting global frameworks is not always easy because it requires significant costs. At the same time, the “green premium,” or incentive for adopting more stringent environmental standards, does not exist yet. There is also a need for Indonesia’s nickel sector to be more transparent. Better traceability will avoid the possibility of nickel being mined from Indonesia’s protected areas, a case that recently emerged in Raja Ampat.
2pm: I spend some time engaging with external stakeholders, such as business partners, consultants and the media. These conversations are key to building partnerships and aligning expectations. Sustainability is a shared journey. We need allies who understand the vision and are willing to walk with us. Our key allies include the governments, industry associations and suppliers who are committed to responsible mining practices.
Communication with journalists is mixed. I feel that international journalists tend to be more critical of nickel mining, while local journalists are generally more supportive. The message I want to convey is that a green premium is necessary to establish a sustainable nickel ecosystem, as without this incentive, there is no economic model that can drive a systematic shift towards more responsible metal production, especially in the short term.
4pm: As the day winds down, it’s time to review sustainability performance data and reflect on lessons learned. Performance isn’t just about numbers. It’s about understanding what is working, what is not, and where we can do better. Improvements are needed, particularly in coordinating with people from different departments. Until now, face-to-face meetings are still more effective at conveying messages and obtaining support from other functions than virtual meetings. Also, convincing other parts of the company to invest in sustainability during downturns is not easy, and requires support from the top.
5pm: The commute home is a time for quiet reflection. To unwind, I enjoy reading about sports, geopolitics and policy development, as well as biodiversity conservation. One of the articles I read recently was about US policy on for critical minerals. The curtailment of the Inflation Reduction Act in the US by President Trump reduces the incentives for producing nickel to high ESG standards.
7pm: Dinner is family time. We share stories and enjoy the simplicity of being present. My family remind me of the ‘why’ behind everything I do.
9pm: I read or watch videos before bed at 10pm. This helps me stay curious and balanced. Recently I watched a video on sustainability reporting in Australia. My company is preparing for mandatory climate-related disclosure for Australian companies, which comes into effect in the 2025 financial year.