Good Corporate Governance
LEGAL BASIS, PRINCIPLES, AND COMMITMENT OF IMPLEMENTATION OF GOOD CORPORATE GOVERNANCE POLICY
The Company is committed to providing added values for stakeholders. One of the key factors to achieve the commitment is a consistent and consequent implementation of Good Corporate Governance/ GCG, and make it as a working culture that prevails within the Company. This perception is the basis of the Company to implement a good corporate governance in every business activity and to achieve the long-term vision sustainably. In addition to the regulations, implementation and practice of corporate governance also refer to the following GCG principles:
The Company consistently adheres to the principle of transparency in running its business by making available material and relevant information in an easily accessible and understandable manner for stakeholders. This principle helps maintain objectivity in managing company business. The Company has taken the initiative to disclose matters that are required by law, and also matters that are crucial for decision making by shareholders, creditors and other stakeholders.
Basic Implementation Guidelines
· The company provides adequate, clear and accurate information in a timely manner so that stakeholders can compare and easily access according to their rights.
· Disclosed information covers corporate vision and mission, business goals and company strategies, financial conditions, management composition and compensation, controlling shareholders, share ownership by members of the Board of Commissioners and Board of Directors as well as their family members in the Company and other business entities, risk management system, internal audit system and controls, GCG mechanism and implementation, and the level of compliance, and significant events that affect the Company.
· The principle of transparency applied by the Company does not reduce its obligation to ensure the Company's confidentiality in accordance with the laws and regulations, employment positions, and personal rights.
· Company policies are issued in writing and communicated proportionally to stakeholders.
Accountability refers to clarity in function, structure, system, and responsibility of Company organs to ensure that the Company is managed in a correct, effective, and measurable manner to serve the best interest of the Company and also to take into account the interest of shareholders and other stakeholders. This principle is a precondition necessary to create sustainable performance.
Basic Implementation Guidelines
· The Company must clearly determine the details of duties and responsibilities of each instrument of the Company and every employee, in line with the Company's vision, mission, values and corporate strategy.
· The Company believes that all instruments and employees of the Company have capabilities according to their respective duties, responsibilities, and roles in implementing GCG.
· The Company ensures that an effective internal control system is in place for managing its operations.
· The Company must establish performance measurements for all organizational levels in accordance to the Company's business goals, and develop a reward and sanction mechanism.
· In carrying out its duties and responsibilities, every instrument and employee must uphold business ethics and the code of conduct that has been agreed upon.
· To ensure long term business continuity and to gain recognition as a good corporate citizen, the Companyshall comply with the laws and regulations at all times, and fulfills its obligation to the community and environment. Basic Implementation Guidelines
· The Company's instruments uphold the principle of prudence and ensure compliance with the laws and regulations, the Articles of Association, and regulations.
· The Company fulfills its social responsibilities by paying heed to the interests of the community and environmental preservation, primarily in areas near the Company's operations by ensuring effective planning and implementation.
· Efforts are consistently made to ensure that the Company is managed in an independent manner whereby Company organs do not dominate each other and cannot be intervened by external parties.
· Basic Implementation Guidelines
· Each instrument of the Company shall prevent the domination from any party, not be influenced by a specific interest, be free from any conflict of interest and from any influence or pressure, in order to ensure that decisions are made in an objective manner.
· Each instrument of the Company must perform its functions and duties in accordance with the Articles of Association as well as the laws and regulations, make sure that none dominate the other and or to shift responsibility onto another.
E. Fairness and Equality
· The Company puts special attention to the interests of shareholders and other stakeholders. The Company also consistently gives equal treatment to the public, capital market authority, capital market community, and stakeholders. A good work relationship with employees is maintained by paying heed to rights and obligations in a fair and reasonable manner.
· Basic Implementation Guidelines
· The Company provides stakeholders with opportunities to offer input and voice opinions for the Company's interest, and opens access to information in accordance with the principle of transparency within the respective scope of work.
· The Company guarantees equal opportunities in employee recruitment and career development, and operates in a professional manner without discrimination based on ethnicity, religion, race, group, gender and physical condition.
To guarantee the implementation of GCG principles in every business aspect in the Company, the active roles of the Board of Commissioners and Board of Directors are of utmost importance. An active role and support is demonstrated through:
· Implementation of duties and responsibilities of the Board of Commissioners and Board of Directors.
· Comprehensiveness and implementation of duties of committees and work units that are responsible for the Company's internal control.
· Implementation of the compliance function and risk management.
· Information transparency, including the Company’s financial condition.
CORPORATE GOVERNANCE STRUCTURE
In accordance with Law No. 40 Year 2007 on Limited Liability Company, the Company's instruments consist of General Meeting of Shareholders (GMS), Board of Commissioners and Board of Directors, Management consisting of Board of Commissioners and Board of Directors that have authority and clear responsibility according to respective function as expressed in the Articles of Association and the Laws and Regulations.
The Company's Governance Structure consists of:
I. General Meeting of Shareholders (GMS)
II. Board of Commissioners
III. Board of Directors
IV. Committees under the Board of Commissioners
V. Internal Audit Unit
VI. Corporate Secretary
GENERAL MEETING OF SHAREHOLDERS (GMS)
The GMS is authorized to appoint and dismiss member of the Board of Commissioners and Board of Directors, evaluate performance, ratify amendments to the Articles of Association, approve the annual report, determine profit allocations, appoint a public, accountant, and determine the amount and type of compensation and facilities for the Board of Commissioners and Board of Directors. The Company guarantees the disclosure of information regarding the Company to the GMS providing it is
not in conflict with Company interest, nor in contradiction with the prevailing laws and regulations.
BOARD OF COMMISSIONERS
Board of Commissioners is responsible for supervising and giving suggestions/directions to the Board of Directors, as well as collectively responsible to shareholders and ensuring that the Company implements good corporate governance in all levels in the Company.
Requirements, Membership, and Term of Office
Members of the Board of Commissioners have met both formal and material requirements. Formal requirements are general in nature in accordance with the prevailing laws and regulations, while material requirements are specific in nature based on the Company's needs and the nature of the Company’s business. The Board of Commissioners consists of 5 (five) members, namely: 1 (one) President Commissioner, 2 (two) Commissioners, and 2 (two) Independent Commissioners. Members of the Board of Commissioners are appointed through GMS mechanism for a 5 (five)-year term of office and can be reappointed after the end of the term of office. Term of office of member of the Board of Commissioners ended.
In performing the duties, works are delegated among the members as arranged internally within the Board of Commissioners. A member of the Board of Commissioners has rights to resign from his/her position by handing in a written notice on the intention to the Company no later than 30 days before the date of resignation and the Company shall convene a GMS to decide on the request for resignation within no more than 60 days upon receiving the letter of resignation.
Several stakeholders and shareholders hold positions in Metland’s Board of Commissioners with respective roles to play, including Independent Commissioners with supervisory duties to advance the interests of minority shareholders. Pursuant to the Regulation of Financial Services AuthorityNo. 33/POJK.04/2014 on Board of Directors and Board of Commissioners, the regulation also stipulates that the minimum limit of the number of independent commissioners should be 30% of all members of the Board of Commissioners. The current composition of the Board of Commissioners makes up of 5 (five) persons, in which 2 (two) of the current members hold the position of Independent Commissioners.
BOARD OF DIRECTORS
The Board of Directors is a Company's organ responsible for the activities relating to the Company's management in the best interests of the Company and in accordance with the Comapany's objectives and goals, and to represent the Company on all matters and events with certain limitations as governed in the prevailing laws and regulations, Articles of Association, and/or GMS resolutions. The Board of Directors is also responsible for collective actions as a unified entity. Each
member of Board of Directors may act and make decisions in accordance with each authority.
Requirements, Membership and Term of Office
All members of Metland’s Board of Directors have met both formal and material requirements. Formal requirements are general in nature pursuant to the existing laws and regulations, while material requirements are specific in nature in accordance with Company's needs and the nature of Company's business. The Board of Directors consists of 5 (five) members, namely 1 (one) President Director and 4 (four) Directors. Members are selected by the Nomination and Remuneration Committee and appointed by GMS for a 5 (five)-year tenure. Members may be reappointed according to a GMS decision. Membership shall expire upon resignation, or no longer meets Company requirements, or upon death, or dismissed by the Board of Commissioners, or based on a GMS resolution.
The Audit Committee is established to assist the Board of Commissioners in carrying out its supervision duties on the management of the Company by the Board of Directors, in line with the principles of good corporate governance. Audit Committee members are appointed and dismissed by the Board of Commissioners and should be reported in the GMS. The establishment of the Company's Audit Committee as well as the criteria for the committee members refer to the Regulation of Financial Services Authority (POJK) No. 55/POJK.04/2015 concerning the Establishment and Work Guidelines of Audit Committee. Members of Audit Committee should at least consist of an Independent Commissioner as the Committee Chair and 2 (two) independent parties. Committee membership is based on a set of criteria, i.e. members must have unquestionable integrity. At least 1 (one) committee member must have an accounting or finance educational background, and must be knowledgeable enough to read and understand financial statements. Audit Committee members shall have adequate knowledge and experience in accordance with their educational background and with excellent communication skills.
Tenure of Audit Committee Members
Tenure of Audit Committee members of the Company is not longer than the tenure of Board of Commissioner of the Company as stipulated in the Articles of Association.
Independency of Audit Committee
All members of Audit Committee are professional individualswho do not have both direct and indirect business relationship within the Company's activities to maintain their independency in upholding their duties and responsibilities. Therefore, all members of Audit Committee have met the criteria of independency, skills, experience and integrity stipulated in the prevailing regulations.
NOMINATION AND REMUNERATION COMMITTEE
To realize good corporate governance that refers to Company's Articles of Association and its amendment, Law Number 40 of 2007 on Limited Liability Companies and regulations in Capital Market, particularly Financial Services Authority ("OJK") Number 34/POJK.04/2014 on Nomination and Remuneration Committee for Issuers or Public Companies that regulates that Issuers or Public Companies must have nomination and remuneration functions. To implement such function, Board ofCommissioners may establish Nomination and Remuneration Committee ("Committee"). In implementing its duties and responsibilities, the Committee must have internal policies that cover work guidelines and code of conduct that must be acknowledged and has binding power for all Committee members.
Term of Office:
Term of office of the members is no longer than term of office of the Board of Commissioners as stated in the Articles of Association.
Independency of Nomination and Remuneration Committee
Nomination and Remuneration Committee is occupied by individual who has competence and capability in implementing remuneration system and determining nomination for the Board of Commissioners and Board of Directors, thus having independence principle that is free from conflict of interest among management.
As regulated by the Government that every public companies are obliged to have a Corporate Secretary whose function is to ensure the smoothness of communication between stakeholders and the Company. The presence of Corporate Secretary has been regulated in POJK No.35/POJK.04/2014 on Corporate Secretary of Public Companies and the position is under the Board of Directors, and responsible to the Board of Directors for the implementation of the duties. Corporate Secretary is assisted by Investor Relation, Corporate Communication, Legal, and Litigation to create an effective and sustainable performance.
Internal audit helps provide independent and objective assurance and consulting services designed to add value and improve Company operations through a systematic approach by evaluating and enhancing the effectiveness of risk management, control and governance processes.
The independent oversight function of Metland’s finances is carried out through an audit by Public Accounting Firm. The scope of the audit process covers financial audit and annual reports, in addition to specific compliance audit and performance evaluation audit services.
Every business process implemented by the Company carries risks that can affect the ability to achieve Company objectives. Risk management refers to a systematic method to manage risks and determine how these risks should be accurately managed. Risk management also helps identify sources of risks and uncertainties, and foresees the resulting impact. Effective risk management is a way in which risks can be minimized and a component of the implementation of good corporate governance.
INTERNAL CONTROL SYSTEM
The internal control system aims to provide assurance to stakeholders that all systems, procedures, rules, and norms that should be done by all the organs within the scope of the Company is run properly. An effective control will improve the reliability of financial information, efficiency, and effectiveness of the Company’s operations, and the Company's compliance with applicable laws and regulations. The internal control function helps the Company move towards ensuring good corporate governance (GCG) by applying the principles of Transparency, Accountability Responsibility, Independence and Fairness (TARIF).
The internal control system is under the responsibility of Company management, and overseen by the Company Internal Supervisory Unit. The Internal Control System involves direct supervision by conducting an audit of work units selected based on a sustainable audit concept through the following:
· Maintain and secure Company assets
· Guarantee the availability of more accurate reports
· Heighten compliance with existing rules and regulations
· Reduce financial impacts, irregularities, fraudulence and violations
· Boost organizational effectiveness and cost efficiency
LITIGATION AND INFORMATION ON ADMINISTRATIVE SANCTION
Important Cases are legal problems faced by the Company during the period of the year of the report and have been proposed through legal process both by Court or Arbitrary. In 2015, neither legal case nor administrative sanctions were brought against the Company by related authority institutions.
STATEMENT OF TAX COMPLIANCE
The Company consistently complies with tax regulations as part of its concrete contribution and an obligation to the state. This is in keeping with the government’s keenness to accelerate the development process through the optimalization of tax revenue.
STATEMENT OF FREEDOM FROM DONATIONS FOR POLITICAL ACTIVITIES
The Company has a policy to prohibit the involvement of individuals in the name of the Company in any political activity, including providing donations for political purposes.
CODE OF CONDUCT
"Etiquette applied at Metland is reflected on Metland's Code of Conduct. The continuous implementation of the Company's code of conduct is expected to create a corporate culture that contains corporate values.
The Company implements a whistleblowing system as a form of GCG implementation in order to create good an optimum company performance. The whistleblowing system is implemented as an internal facility to report action/conduct/event/occurrence such as violation, misuse, and fraud to laws, regulations of the Company, code of conduct and conflict of interests done by the internal member of the Company. Regarding the description of the Whistleblowing System, the Company is obliged to report any violation as regulated in the BAPEPAM Regulation Number: KEP-431/BL/2012 dated August 1, 2012 on the submission of Annual Report of Issuers or Public Companies in number 2 point G.13 concerning Description of Whistleblowing System.
The description of Whistleblowing System, as stated in BAPEPAM Regulation, is as follows:
a. Method to report the violation;
b. Protection to the whistleblower;
c. Complaints reporting;
d. Parties managing complaints; andResults from complaints management. In implementing the Whistleblowing System, the Company refers to Decree of Board of Directors on the Implementation and Mechanism of Whistleblowing System of the Company