Public Companies

Governance Guidelines for Public Companies. These regulations contain 5 (five) aspects, 8 (eight) principles, and 25 (twenty five) recommendations on corporate governance recommended by OJK. CIMB Niaga implements such aspects, principles and recommendations based on the “comply or explain” approach as follows:

Aspect Principle Recommendation Implementation

Relationship of The Public Company with the Shareholders in ensuring the Right of the Shareholders

Principle 1 Improve the Implementation Value of the General Meeting of Shareholders (GMS)

1.1. The Public company has technical procedures for opened or closed voting that promote independency and interest of the shareholders

Comply

As an effort to enhance independence, freedom, and confidentiality of shareholders in the voting process, CIMB Niaga adopted a policy of voting at the GMS in private and electronic voting (e-voting) for each agenda of the GMS. This policy is disclosed in the GMS’s Rules of Conduct.

In the Annual GMS (AGM) and Extraordinary GMS (EGM) held in 2018, the voting mechanism is carried out in private and e-voting, by using touch screen provided by CIMB Niaga, smartphones or other mobile devices (tablet, ipad, and others) owned by the Shareholders or their proxies. CIMB Niaga became the first public company in Indonesia to hold e-voting. The vote count was carried out by independent parties, namely the Share Registrar Bureau, PT Sirca Datapro Perdana and Notary, Ashoya Ratam, SH. Thus the independence and interests of the shareholders in voting process shall be maintained.

The GMS Rules of Conduct was uploaded on the Bank’s website 21 (twenty one) days prior to the GMS, distributed to the shareholders upon entering the GMS meeting room, and being conveyed by the Corporate Secretary prior the start of the GMS.

1.2 All members of the Board of Directors and the Board of Commissioners are present at the Annual GMS

Comply

All members of the Board of Directors and Board of Commissioners of CIMB Niaga were present at the AGM on 24 April 2018

Members of the Board of Directors and the Board of Commissioners present at the AGM may represent the Bank to provide explanation of each agenda of the AGM and the AGM can be implemented properly.

1.3 Summary of GMS minutes is available on the public company’s website at least for 1 (one) year

Comply

CIMB Niaga uploaded the summary of the minutes of GMS immediately after the adjournment of the AGM and EGM.

The summary of the minutes of GMS from 2013 to 2018 are available on Bank’s website up to the present day, both Indonesian and English version.

Aspect Principle Recommendation Implementation Relationship

of The Public Company with the Shareholders in ensuring the Right of the Shareholders

Principle 2 Improving

Communication Quality of the Public Company with Shareholders or Investors

2.1 The Public Company has a communication policy with the shareholders or investors

Comply

CIMB Niaga established policy of communication with the shareholders or investors that has been uploaded to the CIMB Niaga’s website (www.

cimbniaga.com).

Communication carried out by the Bank includes the implementation of the GMS, Public Expose, Analyst Meetings, providing quarterly and annual Financial Reports, and provide information disclosure in an accurate and timely manner. CIMB Niaga also provides information on head office and branch address, e-mail addresses and telephone number both on the website and Annual Report, access to Social Media (Facebook, Twitter, Instagram), Call Center, as a channels for the shareholders and investors to be able to communicate with the Bank easily.

2.2 The Public company discloses its communication policy with the shareholders or investors on the website

Comply

CIMB Niaga’s policy of communication with the shareholders or investors is uploaded to the CIMB Niaga’s website (www.cimbniaga.com).

Function and Role of the Board of Commissioners

Principle 3 Strengthen the Membership and Composition of the Board of Commissioners

3.1 Determination of the number of Board of Commissioners members shall consider the condition of the Public Company

Comply

Total members of the Board of Commissioners of CIMB Niaga is in compliance with the prevailing provisions and considered the Bank’s needs, condition, and capability.

As of December 2018, total member of the Board of Commissioners are 7 (seven) person, where 4 (four) of them (>50%) are Independent Commissioners.

Total members of the Board of Commissioners are lower than the total members of the Board of Directors

3.2 Determination of composition of the Board of Commissioners members considers the necessary of diversity, expertise, knowledge and experience.

Comply

The Board of Commissioners of CIMB Niaga has a diverse backgrounds in terms of expertise, knowledge, experience, and citizenship with the objective to support the development of Bank’s business. This shown in the profiles of each member of the Board of Commissioners.

Principle 4 Improve the

Implementation and the Quality of the Duties and Responsibilities of the Board of Commissioners

4.1 The Board of Commissioners has a self-assessment policy to evaluate its performance.

Comply

The assessment policy of the Board of Commissioners and the Committees under the Board of Commissioners is set out in the attachment of the Nomination and Remuneration Committee Charter which accessible through the CIMB Niaga’s website (www.cimbniaga.com).

4.2 The self-assessment policy of the performance of the Board of Commissioners is disclosed in the Annual Report of the Public Company

Comply

The assessment policy of the Board of Commissioners is set out in the attachments of the Nomination and Remuneration Committee Charter and the results of the assessment is disclosed in the GCG Report Section in this Annual Report.

4.3 The Board of Commissioners has a policy with respect to the resignation of Board of Commissioners members if such member is involved in financial crime

Comply

CIMB Niaga’s Board of Commissioners Charter (point XI.4.) has stipulated that members of the Board of Commissioners who are involved in financial crimes and/or other criminal offenses are required to resign from their positions

Implementation of Corporate Governance Guidelines for Public Companies

Aspect Principle Recommendation Implementation 4.4 The Board of Commissioners or the

Nomination and Remuneration Committee shall prepare the succession policy in the nomination process of the Board of Directors’

members

Comply

The succession policy has been stipulated in the Nomination and Remuneration Committee Charter and in the Policy of Nomination of members of the Board of Commissioenrs, Board of Directors and Committees under the Board of Commissioners as well as disclosed in the Report on the Implementation of Duties of the Nomination and Remuneration Committee in this Annual Report.

Function and Role of the Board of Directors

Principle 5 Strengthen the Membership and Composition of the Board of Directors

5.1 Determination of the number of Board of Directors’ members considers the condition of the Public Company and the effectiveness of decision-making

Comply

Without prejudice to the effectiveness of decision making by the Board of Directors, the determination of the number of members of the Board of Directors of CIMB Niaga shall consider:

- The Bank’s financial condition and ability - Organizational needs and the complexity of the

Bank as the 2^nd largest private banks in Indonesia As of December 2018, the number of Board of Directors’ members are 11 (eleven) people. The total members of the Board of Directors is more than the total members of the Board of Commissioners 5.2 Determination of composition of

the Board of Directors’ members considers the necessary of diversity, expertise, knowledge, and experience required

Comply

CIMB Niaga’s Board of Directors has a diverse backgrounds in terms of expertise, knowledge and experience. This shown in the profile of each member of the Board of Directors

The diversity and total members of the Board of Directors are required to provide the best possible solution to Bank, in accordance with the Bank’s needs, size, and business complexity.

5.3 Members of the Board of Directors who are responsible for accounting or finance have accounting expertise and/or knowledge

Comply

The Director of Strategy and Finance of CIMB Niaga, who responsible for accounting and finance, is Mr.

Wan Razly Abdullah

He holds a degree in Law and Accounting from the University of Manchester, UK and has experience in several foreign companies as well as being a member of the Institute of Chartered Accountants of England and Wales. Mr Wan Razly Abdullah meets the criteria of having the accounting expertise and knowledge.

Principle 6 Improve the Implementation of Quality of Duties and Responsibilities of the Board of Directors

6.1 The Board of Directors has a self- assessment policy to evaluate its own performance.

Comply

The assessment policy for the Board of Directors is stipulated in the attachments of the Nomination and Remuneration Committee Charter which accessible through the CIMB Niaga’s website (www.cimbniaga.

com).

6.2 The self-assessment policy to evaluate the performance of the Board of Directors is disclosed in the Annual Report of the Public Company

Comply

The assessment policy for the Board of Directors is stipulated in the attachments of the Nomination and Remuneration Committee Charter and the results of assessment is disclosed in the GCG Report in this Annual Report.

6.3 The Board of Directors has a policy related to resignation of the Board of Directors’ members if involved in financial crime

Comply

CIMB Niaga’s Board of Directors’ Charter (point XI.4.) has stipulated that members of the Board of Directors involved in financial crimes and/or other crimes are required to resign from their positions

Aspect Principle Recommendation Implementation Stakeholders’

Participation Principle 7

Improving Corporate Governance through the Participation of Stakeholders

7.1 The Public company has a policy to prevent insider trading Comply

To prevent Insider Trading, CIMB Niaga already has a Conflict Management Policy that has been uploaded to the CIMB Niaga’s website (www.cimbniaga.com).

This policy establishes the rules, identify, mitigate, and manage any potential conflicts of interest that may arise within the Bank as a result of activities conducted by the Bank’s business units that enable them to obtain information about the Bank, the Bank’s customers, or the CIMB Group.

7.2 The Public Company has an anti-

corruption and anti-fraud policy Comply

CIMB Niaga has regulated Bank’s anti-corruption policies which included in the CIMB Niaga’s Code of Ethics and Conduct.

CIMB Niaga has an anti-fraud strategy that is implemented in the form of a fraud control system, using tools that are an elaboration of the 4 (four) pillars namely; Prevention, Detection, Investigation, and Supervision

Further description on anti-corruption and anti- fraud policies are described in this Annual Report 7.3 The Public Company has policies

concerning selection and capability improvement of suppliers and vendors

Comply

CIMB Niaga already has a Procurement of Goods and Services Policy (No. E.04.A.06) as well as Goods and Services Procurement Procedures (No.

E.04.A.06.P.01) that are disclosed in the Procurement Policy section of this Annual Report.

CIMB Niaga’s Code of Conduct also regulates the relationship with suppliers, vendors, and consultants (partners) that are in collaboration with the Bank, including objective evaluation, prohibition of acceptance of compensation from partners, compliance of the partners with the Bank’s code of conduct as well as consultation and lobbying with partners.

7.4 The Public Company has a policy concerning the fulfillment of creditor’s rights

Comply

CIMB Niaga established its Policy of the Fullfillment of Creditor’s Rights which accessble through CIMB Niaga’s website (www.cimbniaga.com).

This policy stipulated that CIMB Niaga shall apply and respect to creditor’s rights through equal treatment of all creditor, exercising the rights and obligations in a timely manner with no hidden corporate information.