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Commissioners' selection raises questions
A number of state-owned enterprises (SOEs) recently underwent changes in their boards of commissioners (BoC), including the appointment of several politically linked figures, which has raised questions about whether or not the changes were part of the governmentâs politics of gratitude
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A number of state-owned enterprises (SOEs) recently underwent changes in their boards of commissioners (BoC), including the appointment of several politically linked figures, which has raised questions about whether or not the changes were part of the government's politics of gratitude.
In just several days last week, some of the country's largest SOEs saw new faces within their management lineups.
Three out of four state lenders ' Bank Mandiri, Bank Negara Indonesia (BNI) and Bank Rakyat Indonesia (BRI) ' welcomed the arrival of new commissioners, who did not seem to have any experience or background in banking.
'This never happened in the banking sector in the past,' said Said Didu, an SOE expert who previously served as a secretary at the State-Owned Enterprises Ministry.
The commissioners included Cahaya Dwi Rembulan Sinaga at Mandiri, Pataniari Siahaan at BNI and A. Sonny Keraf at BRI.
Cahaya, according to her curriculum vitae, is listed as a Trisakti University multimedia lecturer and the founder of PT Radio Mediasuara Trisakti, popularly known as Radio MS TRI FM.
Nothing in Cahaya's curriculum vitae indicated that she had any previous brush with the banking sector, which is the country's most regulated financial industry.
Her involvement in the presidential campaign of President Joko 'Jokowi' Widodo raised speculation that her appointment as a banking commissioner was not based on her professional merit alone.
Similar speculation also surfaced after Pataniari and Sonny were named commissioners. Both are senior members of the Indonesian Democratic Party of Struggle (PDI-P) and former members of the House of Representatives.
During their stints as lawmakers, they were far from handling banking issues, with Pataniari handling law and human rights issues at Commission III and Sonny managing energy and environmental issues at Commission VII.
Surprising news came from state toll operator Jasa Marga and state construction firm Adhi Karya as well, when the two installed Refly Harun and Hironimus Hilapok as their commissioners. Refly was appointed as Jasa Marga's president commissioner, while Hironimus was elected commissioner of Adhi Karya.
Refly is widely known as a state administrative expert and was chosen to be a special staffer at the State Secretariat after the administration took office.
Jasa Marga president director Adityawarman defended the decision, saying that the firm would need Refly's expertise in law to help solve legal issues, especially those related to land acquisition.
Hironimus' background, on the other hand, showed that he was active as a member of Jokowi's presidential campaign team, particularly in the Papua area.
Even before the five SOEs replaced their BoC members, state telecommunications firm Telekomunikasi Indonesia (Telkom) had replaced one of its commissioners with a politically linked figure late last year ' Dolfie Othniel Fredric Palit, a PDI-P politician.
'They [the commissioners] may be professionals in their own sectors, but not where they are now installed as commissioners. That's why they appear to be in this position due to their close connection to the ruling regime. Is it wrong? No. Is it ethical? No,' Said added.
Both SOE Minister Rini Soemarno and Cabinet Secretary Andi Widjajanto denied speculation that the appointments were politically driven, saying that the commissioners were picked based on their integrity, education, experience and background.
'Many gave input on the [candidates for] commissioners; of course, we considered those [names] based on their integrity, education and experience. Those are the main factors because a commissioner plays a monitoring role,' Rini said.
Andi insisted that all commissioners had undergone assessments and denied that any privileges had been given for those who once supported Jokowi during his presidential campaign.
According to Said, hope now lies with the Financial Services Authority (OJK) to set things accordingly in the state banks, as the financial regulator is in charge of giving the final approval in the selection of the commissioners.
Nelson Tampubolon, OJK commissioner for banking supervision, said that all candidates must pass the OJK's fit-and-proper test before officially taking on the roles. 'We will refer to the existing Banking Law,' he said in a text message.
The appointment of the commissioners must comply as well with laws on SOEs and limited liability companies (LLC), due to the banks' status as SOEs or LLCs.
Law No. 19/2003 on SOE stipulates that members of the BoC must possess adequate knowledge in the area that the company operates in.
Separately, Yunarto Wijaya, executive director of research institute Charta Politika, said that the practice of politics of gratitude was unavoidable. 'It has become a habit and the positions of commissioners at SOEs are not exempt from that,' he said in a telephone interview.
The most important thing, he added, was to bar politicians from becoming a member of an SOE's board of directors, as it would prevent them from meddling in its operations.
'There should also be a part in the SOE Law that requires related competence in the appointment of the commissioners,' he said.
