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BRI’s good corporate governance gains international recognition
Indonesia’s state-owned enterprises (SOEs) have opened a new chapter of good corporate governance (GCG) with state-owned lender Bank Rakyat Indonesia (BRI) being named among the Top 3 Indonesian Publicly Listed Companies.
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The corporate performance that is apt to produce positive and sustainable growth cannot be separated from BRI’s commitment to prudent risk management and the implementation of GCG based on international best practices, which has led to BRI being named one of the three best publicly listed companies in Indonesia.
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ndonesia’s state-owned enterprises (SOEs) have opened a new chapter of good corporate governance (GCG) with state-owned lender Bank Rakyat Indonesia (BRI) being named among the Top 3 Indonesian Publicly Listed Companies (PLCs) and the ASEAN Class Threshold by the ASEAN Corporate Governance Scorecard (ACGS).
The ACGS is an instrument for assessing publicly listed companies with respect to implementing GCG in ASEAN countries.
Since the early 2000s, the government has initiated a change in SOEs, starting from restructuring, privatization, making SOEs profitable and establishing holding companies for SOEs.
According to Pandhu Yuanjaya, a lecturer at Universitas Negeri Yogyakarta’s Public Administration School, the SOEs Ministerial Decision No Per.01/MBU/2011 on the implementation of GCG should encourage the SOEs to implement GCG. However, most SOEs have yet to implement it properly.
In 2015, the Organization for Economic Cooperation and Development (OECD), along with the Financial Services Authority (OJK), launched the new G20/OECD Principles of Corporate Governance (CG) in Jakarta following a G20 conference in Ankara, Turkey.
The new GCG G20/OECD principles, an expanded version of the previous ones, provide recommendations for national policymakers on the rights of shareholders, executive remuneration, financial information disclosure, behavior of institutional investors and how the market stock mechanism should function.
According to the OJK (ojk.co.id), GCG is an important element for investment and financing through the capital market and a key to spurring long-term economic growth.
GCG OECD principles have been recognized as a global standard on GCG and are expected to help policymakers evaluate and increase GCG frameworks to promote financing through the capital market and boost long-term investment.
GCG OECD principles complement the GCG principles that the OJK has implemented. GCG plays a crucial role in spurring the players of financial services to carry out their business activities based on principles of transparency, accountability, responsibility, fairness and independence to gain trust from investors and other stakeholders.
The internationally recognized GCG/OECD principles cover effective CG frameworks; the rights and just treatment of shareholders and key functions of ownership; institutional investors; capital market; the role of stakeholders in the CG; transparency and information openness; and responsibilities of the board of directors and board of commissioners.
BRI corporate secretary Amam Sukriyanto said the achievement proved SOEs were increasingly assessed in terms of their performance. This could not be separated from the strong commitment BRI’s Board of Commissioners and Board of Directors had made in implementing GCG principles in all aspects of the organization. “The corporate performance that is apt to show positive and sustainable growth cannot be separated from BRI’s commitment to prudent risk management and the implementation of GCG based on international best practices, which has led to BRI being named one of the three best publicly listed companies in Indonesia,” Amam said.
ACGS’s evaluation of 100 publicly listed companies with the largest market capitalization in the ASEAN countries is assigned independently by the Domestic Ranking Body (DRB), in which for Indonesia, DRB is represented by the OJK.
The ACGS assessment covers the rights of shareholders, the equal treatment of shareholders, the role of stakeholders, disclosure and transparency and the responsibility of the Board of Directors and the Board of Commissioners.
“The achievement is definitely a plus point for the company with a vision to becoming the most valuable bank in Southeast Asia and home to the best talent,” Amam concluded.
For further information on Bank Rakyat Indonesia, please visit www.bri.co.id.
