Amid rapid mining operation expansion in Southeast Sulawesi province, its administration is calling for an urgent regulatory overhaul, particularly in aligning mining practices with ESG (Environmental, Social, and Governance) standards.

The message was conveyed by Andi Aziz, Head of the Southeast Sulawesi’s Energy and Mineral Resources Agency, representing the Southeast Sulawesi Governor at the Indonesia ESG Forum 2025, held at the Sultan Hotel, Jakarta, on Monday, June 2, 2025.

"It is time we adopt ESG as the standard framework in our mining operations," Aziz said.

Southeast Sulawesi, along with North Maluku and South Sulawesi, is among Indonesia’s key nickel-producing regions. The province currently holds 190 mineral and coal mining permits, although not all are active. Of those, 71 companies have approved Work and Budget Plans (RKAB) for the year, collectively targeting nearly 100 million tons of production. Yet, despite the scale of output, environmental performance remains a critical concern.

"We only have one company rated with a gold PROPER − the national environmental compliance rating. Most others are still at red status, and that’s deeply concerning for us at the local level," Aziz cited.

He emphasized the need for tighter coordination among various regulatory agencies, noting that fragmented and overlapping policies often create loopholes that undermine sustainability goals.

Aziz also highlighted the social impacts of unchecked mining expansion. “We’re witnessing massive shifts in local livelihoods. Farmers, fishermen, and plantation workers are leaving their trades to pursue work in mining, often based on unrealistic economic expectations. This is causing significant social tension and labor imbalances across sectors,” he said.

To address these issues, the local government is advocating for transparent labor data, especially regarding manpower needs in the mining industry.

“We need mining companies to disclose labor demand based on competency requirements so we, as the regional government, can prepare a skilled local workforce accordingly,” Aziz said.

He also raised concerns about the lack of transparency in foreign workers recruitment, which he said often involves multiple ministries, including Foreign Affairs and Law and Human Rights.

Aziz further warned that existing regulations are falling behind the pace of technological advancement in the mining industry.

“Ten years ago, nickel ore with 2 percent content was the norm. Today, operations are extracting ore with just 0.8percent content − that’s a massive technological leap. Our regulatory frameworks are simply not catching up,” he remarked.

This technological gap has had environmental consequences. Aziz stated that nearly 50 percent of the province’s forested areas have already been opened up due to mining, adding pressure on local ecosystems and increasing the urgency for better environmental governance.

Concluding his remarks, Aziz called on the central government, industry players, and local stakeholders to jointly restructure the regulatory ecosystem governing extractive industries. “The constitutional mandate is clear − our natural resources must be managed for the greatest benefit of the people. ESG must be more than a compliance checklist; it should be a foundational principle for long-term prosperity,” he said.