Pursuant to Financial Services Authority regulation No. 21/POJK.04/2015 regarding the Implementatin of Corporate Governance in Public Companies and Financial Services Authority Circular No. 32/SEOJK.04/2015 concerning the Corporate Governance Guideline of Public Companies, the implementation of 5 (five) aspects, 8 (eight) principles of good corporate governance, and 25 (twenty five) recommendations of good corporate governance aspects and principles based on “comply or explain” are as follows:
Aspects Principles Recommendations Implementations
1. relationship between Public Companies and shareholders in Assuring the rights of Shareholders
Principle 1:
Increase the value of General Meeting of Shareholders
1.1 Public Company has the options or technical procedures of opened and closed voting, observing independency and the interests of shareholders
Principle is complied
The Company has formulated the GMS rules uploaded in the Company’s website 28 days prior to the GMS and distributed to shareholders upon entering meeting venue
1.2 All members of the Directors and Board of Commissioners of public company attend the annual GMS
Principle is not complied 1 member of the Directors was unable to attend the meeting due to an urgent matter. All members of the Board of Commissioners attended the GMS 10 April 2015.
1.3 GMS Minutes available on the website of a public company for at least 1 (one) year
Principle is complied
On the same date of the GMS 10 April 2015, the Company uploaded the GMS minutes including material information and resolutions of the meeting. The Company also uploaded video link http://youtu.be/
ltMopwWvZF8 Principle 2:
Enhancing Quality of Communications between the Public Companies with Shareholders or Investors
2.1 Public Company has communications policy concerning its interaction with shareholders or investors
Principle is not yet complied, however, the Company maintains close communication through, among others, public exposé, provision of information, information disclosure, and ensures that contact number and address are available in the Company’s website or Annual report, for easy communications access to shareholders. Currently, the communications policy concerning shareholders or investors is being developed.
Aspects Principles Recommendations Implementations 2.2 Public Company discloses
its communications policy with shareholders or investors via website
Principle is complied
The policy will be uploaded in the website once ready. However, the contact number and address for shareholders or investors are available in the website.
2. Function and role of the Board of Commissioners
Principle 3:
Strengthen the Board of Commissioners Membership and Composition
3.1 The determination of number of the Board of Commissioners members considers the condition of Public Company
Principle is complied
In identifying number of the Board of Commissioners members, the Company constantly considers the requirements, conditions, and capacity of the Company
3.2 The Board of Commissioners composition considers diversity of skills and knowledge
Principle is complied The Company’s Board of
Commissioners has the diversity of skills, knowledge, and nationalities.
This quality also maintains competitive advantage.
Principle 4:
Enhance the Quality of the Board of Commissioners Duties and responsibilities Performance
4.1 The Board of Commissioners has self-assessment policy to measure the Board’s performance
Principle is complied
The Board of Commissioners is required to assess its performance in the Company, which is
implemented through questionnaires 4.2 Self-assessment policy
to appraise the Board of Commissioners performance is disclosed in the Annual report of a Public Company
Principle is complied
The Board of Commissioners assessment policy is disclosed in a separate section of this Annual report
4.3 The Board of
Commissioners has the policy concerning members’
resignation in the event that a member is involved in financial crimes
Principle is complied
The policy concerning the right of the Board of Commissioners members to resign from his/her position is stipulated under Article 17.6 of the Articles of Association.
The resignation shall be followed up in the GMS. In the event of breach committed by the Board of Commissioners members, the Board of Commissioners may dismiss the member at any time (for instance, the breach of financial crimes committed by the Board of Commissioners members)
Corporate Governance Process
Aspects Principles Recommendations Implementations 4.4 The Board of
Commissioners or Committee that exercises the Nomination and remuneration function develop succession policy in the process of the Directors members nomination
Principle is complied
The succession policy is stipulated in the Nomination and remuneration Committee Charter. The duties, responsibilities, and authority of the committee include the nomination of prospective and qualified members of the Board of Commissioners, Sharia Supervisory Board, and Directors to be submitted to the Board of Commissioners for the approval of the Financial Services Authority and General Meeting of Shareholders. The candidate is not limited to individuals outside the Company, but may also include individuals from the Company’s internal.
In practice, several individuals of the Company that are recognised for their competency and performance have been nominated as Directors.
They are, among others, Mr. Daniel James rompas (vice President Director), Ms. L. Wulan Tumbelaka, Compliance Director), Ms. Megawati Sutanto (Credit Director), and Mr.
John Simon (Treasury Director).
3. Directors Function and role
Principle 5:
Strengthen the Directors Membership and Composition
5.1 In identifying number of the Directors members, Public Company considers its condition and decision making effectiveness
Principle is complied
Without compromising the decision making effectiveness of respective Director, the Directors membership considers:
- The Company’s financial condition and capacity
- Organisational needs and complexity as the fifth largest Bank in Indonesia with nation- wide service scope and over 800 office networks
5.2 The Directors composition reflects necessary diversity of skills, knowledge, and experience
Principle is complied
The Company’s Directors consists of individuals with diverse background of skills, knowledge, and experience.
Their individual profiles are available for review. The Directors diversity is necessary for the Company to enrich its culture and to complement the set of knowledge in order to be
Aspects Principles Recommendations Implementations 5.3 The Directors member
responsible for accounting or finance has relevant expertise and knowledge
Principle is complied
The Company’s Finance Director, Mr. Wan razly Abdullah is an expert and seasoned accountant with experiences in various foreign companies. He graduated from Institute of Chartered Accountants in England and Wales and is a holder of degree in Law and Accounting from University of Manchester, Inggris.
Principle 6: Enhance the Quality of the Directors Duties and responsibilities Performance
6.1 The Directors has self- assessment policy to measure the Directors performance
Principle is complied
In implementing strategy and monitoring the performance achievement, the Company applies Balanced Scorecard that converted to Key Performance Indicators (KPIs), adopting four perspectives of balanced scorecard: finance, customer, internal process, and people. The Directors’ performance is reflected from the level of the Company’s soundness indicated by risk profile, Good Corporate Governance (GCG), profitability, and capital.
The result of the Directors’
performance assessment is one of the basis of remuneration provided to each Directors member.
6.2 Self-assessment policy to appraise the Directors performance is disclosed in Annual report of the Public Company
Principle is complied
The Directors assessment policy is disclosed in a separate section of this Annual report.
6.3 The Directors has the policy concerning members’
resignation in the event that a member is involved in financial crimes
Principle is complied Pursuant to the Company’s Articles of Association, based on the Board of Commissioners meeting resolution, the Board of Commissioners has the right to temporarily dismiss a Director. The dismissal shall be followed up in the GMS and may occur, for instance, due to offence or crimes committed by the Directors members.
Corporate Governance Process
Aspects Principles Recommendations Implementations 4. Stakeholders
Participation Principle 7:
Enhance Corporate Governance through Stakeholders Participation
7.1 Public Company has in place the policy to prevent insider tradings
Principle is complied
The Company has in place the Conflict Management/Insider Trading policy.
7.2 Public Company has in place the anti-corruption and anti-fraud policies
Principle is complied
The Company has in place the internal policies against illegal actions, namely Anti-Fraud Policy, Code of Conduct, and Whistleblowing Policy as disclosed in separate sections of this Annual report.
7.3 Public Company has in place the policy on suppliers or vendors selection and capacity building
Principle is complied
The policy on suppliers or vendors selection is set forth under Point 6.3 of the Code of Conduct that in principle stipulates that each vendor shall understand rules applicable in the Company related to goods and services procurement from a third party.
7.4 Public Company has in place the policy to fulfill the rights of creditors
Principle is complied
The creditor’s rights are stipulated under Article 126 and 148 Corporate Law and Article 23 of the Company’s Articles of Association.
7.5 Public Company has in place the whistleblowing system policy
Principle is complied
The Company has in place the internal policies against illegal actions, namely Anti-Fraud Policy, Code of Conduct, and Whistleblowing Policy as disclosed in separate sections of this Annual report.
7.6 Public Company has in place the policy of long- term incentives for the Directors members and employees
Principle is complied
The Company has in place the long-term incentive policy, including share option for Management (MOP), Management Equity Program (MEP), and employee share option (EOP).
Aspects Principles Recommendations Implementations 5. Information
tranparency Principle 8:
Enhance Information Transparency Implementation
8.1 Public Company utilises range of information technology platforms other than website as channels of information transparency
Principle is complied
In addition to website, the Company also uses other forms of IT and social media applications, such as SMS Banking, Instagram, Phone Banking, Facebook, and Twitter.
8.2 Annual report of Public Company discloses the ultimate beneficiaries of at least 5% shareholding in the Public Company, in addition to the disclosures of ultimate beneficiaries of shareholding in a Public Company through majority and controlling shareholders
Principle is not yet complied, however the Company is undertaking corporate measures and is in the process of meeting this principle. The Company is also in constant communications with the stock exchange.
Until the end of December 2015, the Company has no other shareholders that own 5% of shares other than Majority/Controlling shareholder.
The Financial Services Authority issued the regulation No. 18/POJK.03/2014 dated 18 November 2014 regarding the implementation of Integrated Corporate Governance in Financial Conglomerate. The regulation stipulates the establishment of financial conglomerate, identification of Parent Entity in financial conglomerate, and comprehensive and effective implementation of Integrated Corporate Governance pursuant to provisions in the regulation.
CIMB Group’s financial services institution in Indonesia has enforced this regulation. Further explanation on the Integrated Corporate Governance Committee is disclosed under the Committees of the Board of Commissioners.