Implementation of Corporate Governance Aspects and Principles in Public Companies Pursuant to Otoritas Jasa Keuangan Regulations
Based on the OJK Regulation No. 21/POJK.04/2015 on Implementation of the Guidelines for Corporate Governance in Public Companies and OJK Circular Letter No. 32/SEOJK.04/2015 on Governance Guidelines for Public Companies, there are 5 (five) aspects, 8 (eight) principles, and 25 (twenty-five) governance recommendations submitted by OJK. CIMB Niaga implements these aspects, principles, and recommendations based on the following “comply or explain” approach:
| Aspect | Principle | Recommendation | Explanation |
|---|---|---|---|
| Public Company Relationship with Shareholders in ensuring the Right of the Shareholders | Principle 1: Improve the Management Value of the General Meeting of Shareholders (GMS) |
1.1 The Public Company has a technical voting procedure either open or closed that promotes independency and the interest of shareholders. | Comply In an effort to improve the independence, freedom, and confidentiality of shareholders in the voting process, CIMB Niaga has a policy of conducting voting in the GMS in a closed and electronic manner (e-voting) for each agenda in the GMS. This policy is set out in the Rules of the GMS. The closed and electronic voting mechanism in the Annual GMS and Extraordinary GMS has been conducted since 2018 using a touchscreen devices provided by CIMB Niaga or using the smartphone or other mobile devices (tablet, iPad, and others) of shareholders or their proxies. CIMB Niaga is thus the first Listed Company in Indonesia to implement e-voting. Shareholders and/or their proxies who are electronically present can carry out the e-voting process on the eASY.KSEI application. Meanwhile, Shareholders who provide power of attorney using the e-Proxy mechanism are deemed to have exercised their voting rights through the eASY.KSEI application and are not permitted to carry out the e-Voting process at the GMS venue. Vote counting is conducted by independent parties, namely PT Bima Registra, share administration bureau, and Ashoya Ratam S.H., Notary. This protects the shareholders’ independence and interests in the voting process. The Rules of the GMS and e-voting mechanism video at the GMS venue have been uploaded to the Bank’s website 28 (twenty-eight) days prior to the date of the GMS, distributed to the shareholders as they enter the GMS venue, and read aloud by the Corporate Secretary before the GMS starts. |
| 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 the Board of Commissioners of CIMB Niaga were present at the AGM on 8 April 2022. The attending members of the Board of Directors and Board of Commissioners were able to represent the Bank in informing all of the AGM agendas to ensure that the meeting proceeded smoothly. |
||
| 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 GMS minutes on the same day after the closing of the GMS on CIMB Niaga’s website (www. cimbniaga.co.id). The summary of the minutes of the GMS from 2013 up to the present day is available on the Bank’s website, both in Bahasa Indonesia and English. |
||
| Public Company Relationship with Shareholders in ensuring the Rights of the Shareholders | Principle 2: Improving the 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 has Policy on Communication with Shareholders or Investors No.M.02, that has been uploaded on the CIMB Niaga’s website (www.cimbniaga.co.id). The communication carried out by the Bank includes the implementation of the GMS, Public Expose, Analyst Presentation, teleconference/meetings/webinars with investors and analysts, Annual Rating Review, publication of Monthly, Quarterly and Annual Financial Statements, as well as through accurate and timely disclosure of information. CIMB Niaga also provides information on head office and branch location addresses, e-mail addresses, and telephone numbers, both on the website and the Annual Report, access to social media (Facebook, Twitter, Instagram, LinkedIn) and Contact Center as a means for shareholders and investors to easily communicate with the Bank. |
| 2.2 The Public Company discloses its communication policy with the shareholders or investors on the website. | Comply Policy of Communication with Shareholders or Investors of CIMB Niaga No.M.02 has been uploaded to CIMB Niaga’s website (www. cimbniaga.co.id). |
||
| Function and Role of the Board of Commissioners | Principle 3: Strengthen the Board of Commissioners Membership and Composition |
3.1 Determination of the number of members of the Board of Commissioners shall consider the condition of the Public Company. | Comply CIMB Niaga has established a Policy for the Nomination of Members of the Board of Commissioners, the Board of Directors and Independent Parties as members of the Committees under the Board of Commissioners No. M. 04 as a guideline for the Nomination and Remuneration Committee in the nomination process of members of the Board of Commissioners of CIMB Niaga by considering the needs, conditions, and capabilities of the Bank. As of December 2022, the Board of Commissioners of the Bank consists of 6 (six) persons, of which 3 persons (50%) are Independent Commissioners. The number of members of the Board of Commissioners does not exceed the number of members of the Board of Directors. |
| 3.2 Determination on the composition of members of the Board of Commissioners considers the diversity, expertise, knowledge, and experience required. | Comply The Board of Commissioners of CIMB Niaga has a diverse background in terms of expertise, knowledge, experience, and nationality that aims to support the development of the Bank’s business. This shown in the profiles of each member of the Board of Commissioners. |
||
| Principle 4: Function and Role of the Board of Directors in Enhancing the Quality of the Duties and Responsibilities performance of the Board of Commissioners. |
4.1 The Board of Commissioners has a self-assessment policy to evaluate its performance. | Comply The policies for the performance assessment of the Board of Commissioners and Committees under the Board of Commissioners are set out in the Appendix of the Nomination and Remuneration Committee Charter, which can be accessed through CIMB Niaga’s website (www.cimbniaga.co.id). |
|
| 4.2 The self-assessment policy on the Board of Commissioners performance is disclosed in the Annual Report of the Public Company | Comply The performance assessment policy of the Board of Commissioners is set out in the Appendix of the Nomination and Remuneration Committee Charter, and disclosed in the Corporate Governance Report section of this Annual Report along with the results. |
||
| 4.3 The Board of Commissioners has a policy related to resignation of the Board of Commissioners’ members if such member is involved in financial crimes. | Comply The Charter of the Board of Commissioners of CIMB Niaga (point XI.4) 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. |
||
| 4.4 The Board of Commissioners or the Committee in charge of the Nomination and Remuneration function prepares the succession policy in the nomination process of members of the Board of Directors. | Comply The succession policy has been stipulated in the Nomination and Remuneration Committee Charter and the Policy for the Nomination of Members of the Board of Commissioners, Board of Directors and Independent Parties as members of the Committees under the Board of Commissioners No. M.04, as well as been disclosed in the Nomination and Remuneration Committee’s Report in this Annual Report. |
||
| Function and Role of the Board of Directors | Principle 5: Strengthen the Board of Directors Membership and Composition |
5.1 Determination of the number of members of the Board of Directors shall considers the condition of the Public Company and effectiveness of decision making. | Comply CIMB Niaga has established a Policy for the Nomination of Members of the Board of Commissioners, Board of Directors and Independent Parties as members of the Committees under the Board of Commissioners No. M.04 as a guideline for the Nomination and Remuneration Committee in the nomination process of members of the Board of Directors of CIMB Niaga by considering the Bank’s financial condition and capability, as well as the organizational needs and business complexity as the second largest private commercial bank in Indonesia. As of December 2022, the Board of Directors consists of 10 (ten) people. The number of members of the Board of Directors of the Bank exceeds the number of members of the Board of Commissioners. |
| 5.2 Determination on the composition of the members of the Board of Directors considers the diversity, expertise, knowledge, and experience required. | Comply The Board of Directors of CIMB Niaga has a diverse background in expertise, knowledge, and experience. This shown in the profiles of each member of the Board of Directors. The Board of Directors’ diversity and composition are required in order to provide the best possible solution for the Bank, according to the Bank’s needs, size, and business complexity. |
||
| 5.3 Members of the Board of Directors in charge of accounting or finance have accounting expertise and/or knowledge. | Comply CIMB Niaga’s Strategy, Finance & SPAPM Director, who is in charge of accounting and finance, is Mr. Lee Kai Kwong. He holds a Bachelor of Science (Fin) from the University of Pennsylvania, USA and previously served as Senior Managing Director - Regional Head of Consumer Business Planning & Analysis at CIMB Bank Malaysia, and has held various positions in the field of finance. Mr. Lee Kai Kwong meets the criteria of having expertise and/or knowledge in accounting and/or finance. |
||
| Principle 6: Improve the Quality of performance of the Board of Directors Duties and Responsibilities |
6.1 The Board of Directors has a self-assessment policy to evaluate its own performance. | Comply The policy for the performance assessment of the Board of Directors is set out in the Appendix to the Nomination and Remuneration Committee Charter, which can be accessed through the CIMB Niaga’s website (www.cimbniaga.co.id). |
|
| 6.2 The self-assessment policy on the Board of Directors performance is disclosed in the Annual Report of the Public Company. | Comply The policy for the performance assessment of the Board of Directors is set out in the Appendix to the Nomination and Remuneration Committee Charter, and disclosed in the Corporate Governance Report section in this Annual Report along with the results. |
||
| 6.3 The Board of Directors has a policy related to resignation of the members of the Board of Directors if such member is involved in financial crimes. | Comply The Charter of the Board of Directors of CIMB Niaga (point XI.4) stipulated that members of the Board of Directors who are involved in financial crimes and/or other criminal offenses are required to resign from their positions. |
||
| Stakeholders Participation | Principle 7: Improving Corporate Governance through Stakeholders Participation |
7.1 The Public company has a policy to prevent insider trading. | Comply To prevent Insider Trading, CIMB Niaga has a Conflict Management Policy that has been uploaded to CIMB Niaga’s website (www. cimbniaga.co.id). The policy establishes the rules, the identification, the mitigation, and the management of any potential conflicts of interest that may arise within the Bank resulting from activities carried out by the Bank’s business units that enable them to obtain information about the Bank, Bank’s customers and the CIMB Group. |
| 7.2 The Public Company has an anti-corruption and Anti-fraud policy. | Comply CIMB Niaga has established an Anti-Bribery and Corruption Policy No. M.11 and Anti-fraud Policy No. E.07 that have been uploaded on CIMB Niaga’s website (www.cimbniaga.co.id). The Anti Bribery and Corruption Policy is intended to provide information and guidance for those working for and on behalf of the Bank, on how to recognize, prevent, convey, and address bribery and corruption issues. The Anti-fraud Policy regulates the framework, governance, and implementation of anti-fraud strategy, which are implemented through 4 pillars, namely prevention, detection, investigation, and supervision. Further explanation regarding the Anti-Bribery and Corruption Policy and Anti-fraud Policy is disclosed in this Annual Report. |
||
| 7.3 The Public Company has a suppliers or vendors selection and capability improvement policy. | Comply CIMB Niaga has established the Goods and Services Procurement Policy No. E.04.A.06, Goods and Services Procurement Procedure No. E.04.A.06.P.01, and Vendor Code of Ethics that have been uploaded to CIMB Niaga’s website (www.cimbniaga.co.id) and disclosed further in this Annual Report. CIMB Niaga’s Employee Code of Ethics & Conduct as well as the Anti-Bribery and Corruption Policy also regulate on the relationships with business partners (customers, suppliers, vendors and consultants collaborating with the Bank), including anti-competition policy, objective evaluations, prohibitions on gratuity, and provisions regarding consultation and lobbying with business partners. |
||
| 7.4 The Public Company has a policy on the fulfillment of creditor’s rights. | Comply CIMB Niaga has Fulfillment of Creditors’ Right Policy No. M.05 that has been uploaded on CIMB Niaga’s website (www.cimbniaga.co.id) and disclosed further in this Annual Report. The policy regulates that CIMB Niaga shall apply and respect the rights of creditors through equal treatment to all creditors, exercising their rights and obligations in a timely manner with no hidden information by the Bank. |
||
| 7.5 The Public Company has a policy on the whistleblowing system. | Comply CIMB Niaga has established the Whistleblowing Policy No. E.08 that has been uploaded to CIMB Niaga’s website (www.cimbniaga.co.id) and disclosed further in this Annual Report. |
||
| 7.6 The Public Company has a long-term incentive policy for the Board of Directors and employees. | Comply CIMB Niaga has Risk-based Remuneration Policy No.A.06.02, which contains policies on the provision of long-term incentives for the Board of Directors and employees considered as Material Risk Taker (MRT). Further information on the Remuneration Policy is presented in this Annual Report. |
||
| Disclosure of Information | Principle 8: Improvement on the Implementation of Disclosure of Information |
8.1 The Public Company benefits from the utilization of broader technology other than Website as information disclosure channel. | Comply In addition to website, CIMB Niaga also utilizes other technology such as phone banking, e-mail, radio, print media, and social media platforms (such as Instagram, Facebook, Twitter, LinkedIn, and YouTube), screen/TV in branches, ATM, OCTO Clicks and OCTO Mobile as media channels for disclosure of information. Further discussion on Access to Company Information and Data is presented in this Annual Report. |
| 8.2 The Annual Report of the Public Company discloses share ownership of at least 5% (five percent), other than disclosure of ultimate shareholders of the Public Company through major and controlling shareholders. | Comply CIMB Niaga has no shareholders that own at least 5% of the Bank’s shares, other than the Controlling Shareholders (CIMB Group), as disclosed in the Corporate Profile section in this Annual Report. |