To attain that goal, the Company consistently implements good corporate governance (GCG) principles which include transparency, accountability, responsibility, independency and fairness, corresponding to the promotion of corporate values and culture which are reflected in the corporate code of ethics and culture.
The goal of implementing GCG throughout the Company is to allow:
- Directing and managing the relationship among shareholders, Board of Commissioners, Board of Directors, employees, customers, partners, community and environment.
- Promoting and supporting the Company’s growth.
- Managing human resource discreetly.
- Managing risk more responsibly.
- Treating stakeholders more responsibly.
- Preventing irregularity in the management of the Company.
- Promoting work ethos.
- Enhancing the Company’s good image.
The Company’s commitment, consistency and success in implementing good corporate governance practice have earned the Company several awards and commendations from independent institutions in varied perspectives, which are:
- The Most Trusted based on Corporate Governance Perception Index conducted by IICG (Indonesian Institute for Corporate Governance) in collaboration with SWA Magazine presented in “IICG – GCG Award” program in Jakarta with an improved score from 82.27 to 84.11 in 2010.
- The Best Role of Stakeholder in ”IICD (Indonesian Institute of Corporate Directorship) Corporate Governance Award” program jointly organized by IICD and Investor Magazine.
- 3rd Rank The Best Corporate GCG Implementation presented by IICD in collaboration with Business Review Magazine during ”Business Review Award” in Singapore.
The Company's assessment regarding the GCG Practice in 2008 showed a total score of 89.75 and termed Good Implementation of GCG.
In 2010 the Company made some improvement on GCG implementation as follows:
- With the aid of a consultant, the Company developed a new GCG Soft Structure: Board Manual, GCG Code, Code of Conduct
- Code of Conduct is a guide to direct the conduct of all personnel of the Company, which has been socialized to all personnel, elaborating on:
- Conflict of interest policy
- Restriction of giving and receiving gift, bribe, and the like
- Goods and services procurement policy
- Procedure of reporting misconduct (whistle blowing system)
- Completion of code of conduct compliance sheets by all employees
Corporate Government Structure
GCG Code is the crystallization of all rules that guide the implementation of GCG best practices, cultural values, vision and mission. GCG Code is the crystallization of all rules that guide the implementation of GCG best practices, cultural values, vision and mission.
The Company’s organ is composed of General Meeting of Shareholders, Board of Commissioners and Board of Directors and each has its own vital role in the implementation of GCG. The three corporate organs operate independently in their respective function, task and responsibility for the sole purpose of the Company.
General Meeting of Shareholders (GMS) is the highest body within the Company, a forum for the shareholders to act on an equal footing for adopting important resolutions associated with the capital invested in the Company. However, GMS cannot intervene in the day-to-day decision making by the Board of Commissioners and Board of Directors.
Board of Commissioners is a corporate organ whose function is to supervise in a general as well as specific sense, and give counsel to the Board of Directors. While Board of Directors is an organ fully authorized and responsible for the day-to-day management of the Company in keeping with its purpose and objective.
Audit Committee is formed to assist Board of Commissioners to implement good corporate governance, form adequate internal control structure, enhance disclosure practice and financial reporting, as well as review the scope, accuracy, independency and objectivity of public accountant.
Good Corporate Governance Committee (GCG Committee) is set up to assist Board of Commissioners to oversee the practice of GCG by the Company. The Committee was previously combined with NR Committee as Nomination, Remuneration and GCG Committee.
Nomination, Remuneration and Human Resource Development Committee, further to be referred to as NR & HRD Committee, is a committee that went through a change of name and membership in 2010. Previously this Committee was known as NR & GCG Committee, in charge of assisting Board of Commissioners in matters pertaining to nomination, remuneration and GCG implementation.
NR & HRD Committee works independently, set up by and accountable to Board of Commissioners.
Insurance, Business Risk and Post-Mining Committee, further referred to as BR Committee, is set up to give independent and professional viewpoint to Board of Commissioners with regard to business risks, insurance, environment and postmining area management.
BR Committee consistently recommends that all high and extreme business risks be identified and mitigated.
Corporate Secretary ensures that the most current, punctual and accurate information regarding the Company is available for the shareholders, analysts, mass media and general public. The information includes quarterly and annual financial reports.
The Corporate Secretary plays a major role in facilitating communication among the corporate organs, relationship between the Company and its stakeholders, and compliance with the prevailing laws and regulations.
The Management develops an effective internal audit and control system to safeguard the Company’s investment and assets.
Internal Auditor serves as Internal Audit Unit (IAU).
The external auditor who audited the Company’s 2010 financial statements was appointed by AGMS by the recommendation of Board of Commissioners and Audit Committee. To guarantee the independency and quality of audit, the appointed external auditor must have no conflicting interest with each level of the Company’s organ.
To strengthen internal audit and control system, the management set up Corporate Management System Work Unit (CMS). The vision of CMS is to become a reliable work unit in managing the Company’s business process by consistently implementing GCG principles to enhance corporate value.
Code of Conduct is one of the Company’s tools to enhance everybody’s integrity so as to apply GCG best practices to the utmost level.
Basically, the Company's Code of Conduct Manual regulates all matters under the responsibility of the Company, individuals of the organization and other parties doing business with the Company, covering:
- Business Code of Conduct
- Individual Code of Conduct
- Disseminating Code of Conduct and Reporting Violation
- Statement of Compliance with Code of Conduct
The Company has a value system that is adopted and implemented to build corporate culture. The basic philosophy in building the value system is work ethos of Trusting, Open, Positive, Rational and Conscious of Cost & Environment (TOPRC). These values are elaborated in work culture of Synergy, Professionalism and Faith.
The Company has compiled and formulated a series of standard operating policy to complement GCG Code, which cover the following:
- Rules and Procedures of Whistle Blowing Policy
- Risk Management
- Conflict of Interest Transactions
- Insider Trading
- Performance Management
- Quality Management
- Affiliated Transactions
- Giving and Receiving Gifts
- Goods/ Services Procurement
The Company is always consequent in implementing GCG basic principles throughout its business operations. The following describes briefly the implementation of GCG basic principles.
- Implementation of Transparency Principle
- Implementation of Accountability Principle
- Implementation of Responsibility Principle
- Implementation of Independency Principle
- Implementation of Fairness Principle