204 INTERNATIONAL CONFERENCE ON EURASIAN ECONOMIES 2013 Stakeholder-Based Analysis of Sustainability Report: A Case Study on Mining Companies in Indonesia Dr. Ati Harmoni (Gunadarma University, Indonesia) Abstract This paper reviews the experience of the mining companie in Indonesia that publish a sustainability report. By doing such exploratory research, the study aims to contribute to the development of country-specific descriptive non financial disclosure theory by establishing a benchmark understanding of how company interpret their responsible relationship with stakeholders. Based on content analysis of the annual sustainability report, this paper provide a description of current practices current prioritization in terms of social, environmental, and sustainability disclosure themes. The results show that Indonesian mining companies share a wide range of disclosure themes in order to support relationships with their stakeholders. 1 Introduction One of the main issues that emerged today is the debate on corporate responsibility to the stakeholder groups that influence their behavior and who in turn have an impact on their success. More than ten years of research by MORI has shown increasing corporate responsibility to various stakeholders, from customers and employees to legislators and investors (Dawkins and Lewis, 2003). This increases the concern that corporate responsibility issues are not confined to the public only. For many stakeholders, corporate responsibility is now the dominant driver opinions. Corporate responsibility entails a company’s recognition of broad responsibilities, that is part of society with consequent obligations, and that it should be concerned with more just profit. Concept which is currently considered to describe corporate responsibility not only in terms of profit alone is corporate social responsibility (CSR). CSR – one of the major aspects of sustainable development business, is a concept whereby companies integrate social and environment concerns into the company's business operations, as well as how they interact with stakeholders on a voluntary basis (CEC, 2001). Along with the increasing number of companies acknowledging and internalizing the importance of CSR values and practices, a variety of sources have pressured the private sector to go beyond financial measures as all-inclusive indicators of corporate market performance. This operationally process is well represented by the large number of studies on the multiple ways of enacting CSR, which recognize the existence of a sort of parallelism between corporate socially responsible behavior and the aptitude of companies to systematically demonstrate their ability to respond to the social, economic and environmental requests of their stakeholders (Hummels and Timmer, 2004). For these reasons, in addition to the initial trend, that is, adhering to the CSR paradigm, companies have paid growing attention to the importance of demonstrating CSR commitment through clear and verifiable data and information, similar to more traditional financial documents. Previous studies show that it is difficult for companies investing in CSR activities to maximize their reputation without disclosing information of such activities (Hasseldine et al. 2005). It is generally accepted that companies engaging in CSR activities usually concern the disclosure of related information because of its contribution to financial performance (Orlitzky et al, 2003; Barnett, 2007) or to market value (Mackey et al, 2007). By now, research on CSR disclosure has referred to different theoretical perspectives —those of legitimacy theory, agency theory and stakeholder theory (Gray et al., 1995; Roberts, 1992). While, however, numerous studies have investigated the disclosure of nonfinancial information, only recently has research considered disclosure in a stakeholder-based setting, and extended the research focus to a more comprehensive CSR- reporting framework, based on the triple bottom line approach. In other words, although the content of nonfinancial disclosure has been addressed in an increasing number of studies, the adopted perspective is often partial, impeding the development of a complete CSR portrait (Schwartz and Carroll, 2003) for firms engaged in responsible practices. Indonesia has become the first nation in the world to introduced mandatory legal requirements for corporations to implement corporate social responsibility (CSR) reporting based on Law No. 40 in 2007 regarding Limited Liability Companies. According to this law, all corporations that operate in Indonesia’s natural resources sector or that have business activities related to natural resources must implement CSR, especially in relation to environmental responsibility, called corporate social and environmental responsibility (CSER). All companies are mandated to perform the social and environmental responsibility activities and submit annually the reports of these activities.