ITM believes that an industry will be strong when it is developed in tandem with social and environmental responsibility. This commitment is stated in our Corporate Sustainable Development Policy.

Quality, Safety and Environment (QSE) Management Standards are practical guidelines for delivery of sustainable development, continual improvement in quality, safety and environmental performance. By doing so, the Company can also minimize the non-compliance risk factor and increase our competitiveness as well.

We put sustainable development into practice through effective implementation of QSE standards for all activities that we control and monitor. Thus, we are able to identify, assess and manage risk for our people, contractors, community and also environment.

We set measurable indicators to monitor and review our environmental, health, safety and social responsibility performance for continued achievement of Company goals.

Quality Management System (QMS)

Each business unit under ITM embeds their program activities with QSE management tools, as a long-term strategic driver to corporate excellence.

Small-group activity programs have been upgraded for 2009, relying on programs such as “5S” and more complete integration with the Suggestion System guidelines, in conformity with international standards.

ISO 9001: 2000 Certification was awarded to PT Indominco Mandiri, PT Kitadin Tandung Mayang and PT Jorong Barutama Greston since several years ago, and the Company has committed that PT Trubaindo Coal Mining would be the next to achieve this standard.

Recognition of PT Indominco Mandiri in QMS excellence was granted by the National Quality Convention (Medan, North Sumatra, October 2008), which awarded it a second-place prize. Another achievement marking its position as a world-class coal mining company was an Operational Excellence Award, Level 1, bestowed on PT Kitadin Tandung Mayang by CTPM Australia (Sydney, September 2008). This award was assessed by comparing with other similar company to strengthen our determination in seeking further achievements and stronger competitiveness.

Safety Management System

Safety is a vital key to successful operation in our Company and must be embedded in every single activity within our business process. Each business unit thus prepares its Hazard Identification Risk Assessment and Risk Control (HIRARC) before embarking on any activity, in order to identify potential hazards or risks. Appropriate preventive and corrective action follows within.

Safety training and communications are offered on a regular basis, thus maintaining employee awareness. Focus and development are on safe procedures and attitudes, in both technical and non-technical aspects, yielding benefits to the Company and its stakeholders. It is a point of pride that the Injury Frequency Rate (IFR) and Injury Severity Rate (ISR) in every business unit both dropped during 2008, a reflection of their serious commitment to safety management.

In 2004, PT Indominco Mandiri was certified with OHSAS 18001: 1999 (Occupational Health and Safety Assessment System). PT Indominco Mandiri’s Safety Management System has been implemented consistently and stands as a model for other business units.

The majority of our mining activities are performed by contractors, and this is expected to continue in the future, as the Company grows. The Company recognizes that contractors provide significant contributions to our success and those relationships with Contractors can add or detract from our reputation.

The Company involves local contractors in our business activities, giving them priority in a spirit of sustainability and local development. The Contractor Management System focuses on Environmental, Health and Safety (CMS-EHS) issues, upgrading local contractor attitudes and skills. This is carried out through the Contractor’s Environmental, Health and Safety program, to ensure long term benefits to the Company.

A specialized safety program aiming at specific industrial hazards and risks was created in line with corporate direction. Rules and guidelines are deployed in detail in the CMS-EHS manual; programs at each business unit are planned, put into action, approved, disseminated and evaluated regularly with the Company representatives.

Environmental Management System

The Company is fully in compliance with current laws and regulations, following QSE Management Standards and QSE Technical Guidelines in its day-to-day business.

Each business unit should conduct their environmental management and monitoring program according to an approved Environmental Impact Assessment (AMDAL) document and other related laws and regulations in force.

The responsibility for compliance is accepted by all business units in their working procedure, and set the standards of environmental management, with practices embedded in every single aspect of our business process in. Each business unit should conduct its own Environmental Impact and Aspect Identification (EIAI) before embarking on any activity, in order to identify all aspects that could potentially impact on the environment. To ensure that systems to evaluate compliance are in place, they are reviewed regularly and the results are evaluated, documented and improved as required.

Environmental management and monitoring activities in 2008 have resulted in no significant “nonconformance findings”. Also an environmental compliance audit was conducted regularly by both external and internal parties to identify any potential for nonconformance findings, and suggests corrections accordingly.

A 98% compliance point rating based on the environmental standard was achieved in accordance with the environmental monitoring report prepared by independence laboratory during the year.

PT Indominco Mandiri consistently maintains its performance to ISO 14001:2004 Certification standards; PT Indominco Mandiri was the recipient of a “Environmental First Class Award” from the Directorate General of Mineral, Coal and Geothermal, Jakarta for its overburden management mine reclamation program (December 2008).

The Governor of East Kalimantan also awarded to PT Indominco Mandiri, PT Kitadin Embalut, PT Kitadin Tandung Mayang and PT Trubaindo Coal Mining, through the PROPERDA Valuation Program, for its environmental management program (July 2008). In the national level, the Environmental Ministry Office-Jakarta bestowed another award, through the PROPERNAS Program, a “blue level” compliance and indicated that all of environmental indicator already complied with the standards.