Good Corporate Governance (GCG)

Good Corporate Government (GCG) is one of the main pillars that sustain the operations of a company as well as a key indicator of accountability. PNM has a firm commitment to GCG implementation.

PNM is fully aware that GCG implementation will help achieve the mission of providing the best service to all stakeholders. For PNM, the implementation of GCG is not merely a formality. PNM's commitment to implementing GCG is outlined in the PNM Management System (SM PNM) to ensure the consistency of GCG implementation in the corporate environment as a whole by involving all levels and management tools of the company management.

SM PNM provides measurable and accountable direction for all aspects of GCG implementation and concepts and implementation of ISO 9001: 2008 Quality Management System, Balance Score Card (BSC) and other organizational tools. SM PNM is also based on values ​​and corporate culture. The BSC implementation in PNM focuses on several aspects of corporate organizations such as finance, business processes, HR optimization, and stakeholders.

To maintain the consistency of GCG implementation, companies regularly and programmatically continue to conduct comprehensive studies and evaluations of various aspects of their operations, including studies on supporting business organizations. This study and evaluation will be followed by operational improvements and the company's business in order to be able to meet and satisfy customer needs and expectations for quality services through the output of high quality and competitive products so that they can be well received by the market.

The company's GCG implementation also includes risk management and control to guarantee the company's ability. Another study that is regularly carried out by companies in the evaluation of the completeness of the organizational structure, including the cost and benefit aspects.

PNM Management is committed to realizing good corporate governance based on the principles of openness, independence, accountability, fairness, and accountability in every activity. The practice of Good Corporate Governance is very important to ensure the achievement of sustainable growth.

In addition, Good Corporate Governance can also build a company image and maintain business ethics and compliance with existing regulations so as to provide benefits to all stakeholders.

In order to support the effectiveness and independence of the implementation of the SPI's duties, the President Commissioner and President Director of PT Permodalan Nasional Madani (Persero) has ratified the Internal Audit Charter. The objectives of the authority and responsibility and functions of the SPI have been formally defined in the form of an Internal Audit Charter.

In running a business that generally involves many parties, it is very important to establish cooperation and relationships that are sustainable and in accordance with the principles of good corporate governance.
One of the things that often happens in business relationships in the enterprise is a request or giving gratification from one party to the other. Gratification is a concern of the Corruption Eradication Commission considering its nature which leads to bribery.
For the PT Permodalan Nasional Madani (Persero) has made a guideline governing the gratification as a form of preventive measures and protection for all PNM personnel.

PT Permodalan Nasional Madani (Persero) has provided a whistleblowing system (WBS) for employees to report errors or violations of the code of ethics, regulations, and policies of PT Permodalan Nasional Madani (Persero), with full protection in accordance with the policies of the reporter. Throughout 2018, the Board of Commissioners actively engages and oversees the effectiveness of WBS implementation in the Company. All incoming reports will be verified and followed up by the Violation Handling Committee with the involvement of the Board of Commissioners through periodic guidance and supervision activities. If it is proven to violate, the Company has cooperated with Law Enforcement Officials, including the prosecutor's office and police, to follow up on the case. Thus, we assess the implementation of violation reporting at PT Permodalan Nasional Madani (Persero) has been running effectively.

PT Permodalan Nasional Madani (Persero) has updated the Governance guidelines, board manual, ethical and business conduct guidelines, violation reporting guidelines, and refined the GCG organs for better GCG implementation in the following years.

In addition, PT Permodalan Nasional Madani (Persero) also regularly conducts comprehensive assessments and audits as part of efforts to improve the quality of corporate governance.

Corporate governance is a subject that has many aspects. One of the main topics in corporate governance is the issue of accountability and mandate responsibility, specifically the implementation of guidelines and mechanisms to ensure good behavior and protect the interests of shareholders. Another main focus is economic efficiency which states that the corporate governance system must be aimed at optimizing economic outcomes, with a strong emphasis on the welfare of shareholders. There is also another side that is the subject of corporate governance, such as the stakeholders' point of view, which demands more attention and accountability for parties other than shareholders, such as employees or the environment.

The PT Permodalan Nasional Madani (Persero) internal control system refers to risk management, policies and procedures, as well as applicable regulations/laws that are used in all of the Company's operational activities in order to provide reliable financial information, safeguard the Company's assets from risk of loss and fraud, and effective and efficient operational activities.

The Guidelines for Procurement of Goods and Services are adjusted to the needs of the users of goods and services and are carried out by taking into account the general principles. This guideline is applied to regulate the implementation of the Procurement of Goods and/or Services, all of which are financed by the Company so that the implementation of the Procurement of Goods and/or Services is carried out efficiently, effectively, competitively, transparently, fairly and reasonably and accountability.

PT Permodalan Nasional Madani (Persero) realizes the importance of implementing Good Corporate Governance (GCG) principles as a way to increase shareholder and stakeholder trust. PNM management in addition to having to follow applicable laws and regulations must also uphold behavioral norms and business ethics to enhance the reputation and image of the Company. The Code of Conduct is a set of ethics that behaves PNM Persons that are structured to influence, shape, regulate and conduct behavior suitability so that output is achieved that is consistent and in accordance with the values ​​of corporate culture in achieving its vision and mission. To achieve this goal, a high level of commitment from PNM personnel is outlined in the Code of Conduct. In order to adjust the dynamics of the PNM business, a Code of Conduct is renewed, taking into account the applicable rules and regulations, Vision, Mission, Objectives and PNM Values. The company continues to encourage the compliance of PNM personnel towards this code of conduct by requiring all leaders to ensure that the Code of Conduct is adhered to and executed properly by all PNM personnel in work units under his leadership.