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INTP:IJ Rp. 15,025 altimage 5.07%
01-Dec-2020 16:54
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INTP:IJ Rp. 15025 altimage 5.07%
01-Dec-2020 16:54

Committees under The BOC

In the implementation of its supervisory, advisory and recommendation duties and responsibilities, the Board of Commissioners is assisted by two committees, namely:
1. Audit Committee
2. Nomination & Remuneration Committee

Committees under the Board of Commissioners are in accordance with the prevailing regulation and aim to enhance the implementation of GCG principles in Indocement’s operational activities.

AUDIT COMMITTEE

Audit Committee was established with the primary objective to assist the Board of Commissioners in carrying out its supervisory responsibilities over the financial reporting process, internal control system, audit process, GCG implementation, and the process of monitoring compliance with the applicable laws and regulations. The Audit Committee is responsible to the Board of Commissioners and performs its functions in accordance with the regulations and instructions received from the Board of Commissioners.

Legal Basis
Indocement’s Audit Committee was established based on:
1. OJK Regulation Number 55/POJK.04/2014 regarding the Establishment and Guidelines for the Audit Committee.
2. PT Bursa Efek Jakarta Decree of Board of Directors Number Kep-0001/BEI/01/2014 dated January 20, 2014 Amendement to Regulation Number I-A regarding the Registration of Shares and Equity Shares Issued by Listed Companies.
3. Decree of Indocement’s Board of Commissioners Number 011/Kpts/Kom/ITP/XII/2001 dated December 6, 2001;
4. Decree of Indocement’s Board of Commissioners Number 002/Kpts/Kom/ITP/V/2017 dated May 22, 2017.

Audit Committee Work Guidelines
The Audit Committee has an Audit Committee Charter, which was lastly revised on December 6, 2013, and was established under the Statement of Decision of Agenda No. 2 of the Board of Commissioners’ Meeting No. 007/Kpts/ Kom/ITP/XII/2013 dated December 6, 2013, on Amendment to Audit Committee Charter in order to meet Bapepam-LK Regulation No. KEP-643/BL/2012 dated December 7, 2012.

The Audit Committee Charter, covers the following:
1. Audit Committee’s Purpose
2. Audit Committee’s Membership
3. Audit Committee’s Chairman
4. Audit Committee’s Term of Service
5. Audit Committee’s Duties and Responsibilities
6. Audit Committee’s Authorities
7. Audit Committee’s Meetings
8. Audit Committee’s Reports

Audit Committee’s Membership
Pursuant to the Committee Audit Charter, concerning Indocement’s Audit Committee membership which consists of:
1. One Chairperson who is an Independent Commissioner and
2. Two members who are independent and have expertise as members.

The Audit Committee is appointed and dismissed by the Board of Commissioners for a period of three years from the appointment, and may be reappointed for one next period. The term of service for the Audit Committee members shall not exceed the term of service of the Board of Commissioners.

The Indocement’s Audit Committee members as of December 31, 2019 were as follows:

Audit Committee Members Independence
All members of the Indocement Audit Com ee are independent parties that have no affiliation with the Company, Board of Commissioners, Directors, controlling Shareholders, external auditors and legal counsel of the Company and do not own shares in the Company, directly or indirectly, which can affect their ability to implement assignments and giving opinions, recommendations and suggestions to the Board of Commissioners.

The independence of Indocement’s Audit Committee members are as follows:

Thus, all Audit Committee members’ independence requirements are in accordance with the regulations and the rules of GCG best practices have been met.

Duties and Responsibilities
The Audit Committee provides professional and independent opinions to the Board of Commissioners related to reports and other matters presented by the Board of Directors. Based on the Audit Committee Charter, the Audit Committee’s roles and responsibilities are as follows:

1. To review and discuss with management and the independent auditor concerning the draft annual audited financial statements and quarterly financial statements, and any other financial information to be published.
2. To provide recommendations to the Board of Commissioners on the appointment of the independent auditor, and to examine and control the Company’s accounts and financial statements taking into consideration its independence scope of audit and fee. The Audit Committee Chairperson must pre-approve certain non-audit services provided to the Company by independent auditors, in accordance with OJK rules.
3. To discuss with management and the independent auditor any audit issues and management’s responses, including providing independent opinion in case there are any disagreements between management and the independent auditors.
4. To discuss with management and the independent auditors concerning risk assessments, and risk management practices, and the result of the independent auditors’ assessment on transactions involving conflict of interest transactions and related parties transactions, and to provide recommendations to the Board of Commissioners on known potential conflicts of interest transactions based on the information submitted by the Financial Director, Internal Audit, or independent auditor.
5. To oversee the Company’s internal control system by reviewing the scope of internal audit, and the independent auditors review of internal control, significant findings and recommendations together with management responses.
6. To oversee the Company’s financial reporting activities, including annual report, and accounting standards and principles, significant accounting changes and the key accounting decisions affecting the Company’s financial statements.
7. To review the Internal Audit functions, including:
   a. Purpose, authority and organizational reporting lines;
   b. Annual audit plan, and staffing; and
   c. Audit findings, management responses and follow up.
8. To obtain and review, at least annually, the auditing firm’s independency and any material issues raised by the independent auditors.
9. To review with general counsel matters pertaining to the compliance processes, and programs in general, and the Company’s compliance with relevant laws and regulations.
10. To liaise with the Corporate Secretary and oversee the handling of complaints on accounting and financial reporting processes, as below:
    a. Complaints relating to the Company’s accounting, and questionable accounting, or auditing matters that should be reported to the committee.
    b. The committee shall oversee procedures for the receipt, retention and treatment of complaints on accounting, internal accounting controls, or auditing matters.
11. To maintain confidentiality of the Company’s documents, data and information.

Audit Committee’s Authority
The committee is empowered to review or oversee matters within its scope of responsibility, to access the Company’s documents, data and information, to directly communicate with any Employee, including the Board of Directors, internal auditor, independent auditor and any relevant parties and to advice from external counsel auditors or other experts as necessary.

AUDIT COMMITTEE MEETING

Provisions of Audit Committee Meeting
It is stated in the Audit Committee Charter the regulation regarding member meetings, where the Audit Committee can hold meetings at any time needed or at least once in three months and the meeting must be attended by at least half of the members and decisions taken by deliberation and consensus.

The decisions or minutes of meetings are prepared by the Corporate Secretary, wherein they contain the proceedings and differences of opinions, minutes of the meeting will be signed by the members present to then be submitted to the Board of Commissioners.

Meetings Frequency and Attendance
Throughout 2019, the Audit Committee held meetings four times with attendance rates as follows:

Brief Report Of The Implementation of Audit Committee's Activities
Throughout 2019, Nomination and Remuneration Committee conduct various activies as follow:

  1. Conducting visits to Citeureup and Cirebon factories to directly see the implementation of production process in the Company;
  2. Reviewing the financial statements and financial matters with the Director in charge of financial sector to ensure a transparent financial reporting process and appropriate application of the accounting standards;
  3. Reviewing with Internal Audit on the audit plan and the risk-based approach to ensure adequacy and effectiveness of internal control system;
  4. Discussing significant audit findings with Internal Audit and monitor follow-up to the recommendations of Internal Audit and External Auditors;
  5. Reviewing with External Auditor on the audit plan and audit findings to ensure objective and independent audit process;
  6. Reporting regularly to the Board of Commissioners, Audit Committee activities, recommendations, and other matters that require the attention of the Board of Commissioners;
  7. Evaluating the performance of Public Accounting Firm of Purwantono, Sungkoro and Surja (member of Ernst & Young Global Limited), who conducted audits of the Company’s books for the 2018 fiscal year and provided recommendations to the Board of Commissioners for the appointment of Public Accounting Firm who would audit the Company’s books in the 2019 fiscal year.

Audit Committee Competency Development
Throughout 2019, members of the Company’s Audit Committee attended various programs to increase the competence in the forms of trainings, workshops, conferences, seminars, as stated per the following table:

NOMINATION AND REMUNERATION COMMITTEE

The Nomination and Remuneration Committee is established by and is responsible to the Board of Commissioners in ensuring the implementation of GCG principles and the Company’s ethical standards with the main function to monitor matters relating to remuneration and nomination policies.

Legal Basis
1. OJK Regulation Number 34/POJK.04/2014 dated December 8, 2014 concerning the Nomination and Remuneration Committee of Issuers or Public Companies;
2. OJK Regulation Number 21/POJK.04/2015 dated November 2015 concerning the Implementation of Guidelines for Corporate Governance in Public Companies;
3. Decree of the Board of Commissioners Number 005/ Kpts/Kom/ITP/V/2015 dated May 13, 2015;
4. Decree of the Board of Commissioners Number 003/ Kpts/Kom/ITP/V/2017, May 22, 2017.

Nomination and Remuneration Committee’s Program
The Nomination and Remuneration Committee has a Nomination and Remuneration Committee Charter in carrying out its duties and responsibilities, containing work guidelines that clearly define the duties, responsibilities and scope of work in carrying out their duties transparently, competently, objectively and independently.

The Charter of the Nomination and Remuneration Committee was approved and signed by the Board of Commissioners on December 4, 2015, with the stipulation in the Decree of Board of Commissioners Number 007/ Kpts/Kom/ITP/XII/2015.

Nomination and Remuneration Committee Membership
The Nomination and Remuneration Committee’s members are appointed and dismissed by the Board of Commissioners. The Nomination and Remuneration Committee shall consist of at least three member:
1. One of whom is an Independent Commissioner who will act as the Committee Chairman:
2. Two other members from members of the Board of Commissioners, or parties outside of the Company, or persons who have managerial positions under the Board of Directors who are in charge for human resources.

The Nomination and Remuneration Committee’s members are selected based on the criteria set by OJK with the term of office of members not to exceed Board of Commissioners term of office and be reappointed.

Indocement’s Nomination and Remuneration Committee Composition structure and composition in 2019 are as follows:

Independence of the Nomination and Remuneration Committee

Duties and Responsibilities of the Nomination and Remuneration Committee
Duties and responsibilities of the Nomination and Remuneration Committee as specified in the Nomination and Remuneration Committee Charter, are as follows:

Duties
1. The Nomination and Remuneration Committee shall act independently in performing its duties.
2. In performing its duties, the Nomination and Remuneration Committee shall be responsible to the Board of Commissioners.

Responsibilities
1. Related to nomination functions
   a. provide recommendations to the Board of Commissioners on:
      • composition of members of the Board of Directors and/or Board of Commissioners;
      • policies and criteria required in the nomination process; and
      • policies on performance evaluations for the members of the Board of Directors and/or members of Board of Commissioners;
   b. assist the Board of Commissioners to carry out performance evaluations of the members of the Board of Directors and/or members of the Board of Commissioners based on benchmarks already prepared as evaluation material;d.
   c. provide recommendations to the Board of Commissioners on programs to develop the capability of the members of the Board of Directors and/or members of Board of Commissioners;
   d. provide nominations on candidates who fulfill the requirements as member of the Board of Directors and/or as a member of the Board of Commissioners to the Board of Commissioners for submission to the GMS.
2. Related to remuneration function
   a. provide recommendations to the Board of Commissioners on:
      • remuneration structure;
      • remuneration policies;
      • remuneration amount;
   b. assist the Board of Commissioners to carry out the performance evaluation adjustment to the Remuneration received by the members of the Board of Directors and/or the members of the Board of Commissioners.

Nomination and Remuneration Committee Meetings
The Nomination and Remuneration Committee hold meeting as necessary, at least once in four months, to fulfill its duties and responsibilities, which shall be attended by the Chair and at least 50% of the total members.

Meetings Frequency and Attendance
The Nomination and Remuneration Committee held three meetings throughout 2019, with the agenda and attendance level of each member of Nomination and Remuneration Committee as follows:

Nomination and Remuneration Committee’s Program Report

In 2019, the Nomination and Remuneration Committee organized activities as follows:
1. Holding three Nomination and Remuneration Committee meetings.
2. Attending meetings with Board of Commissioners.
3. Providing recommendations to the Board of Commissioners for remuneration of Board of Directors and honorarium of Board of Commissioners for the Financial Year 2019.
4. Providing recommendation for nomination of candidate, David J. Clarke, to be reappointed as the Company’s Director, effective since the closing of 2018 Annual GMS to 2021 Annual GMS, which will be held in 2022.
5. Revising the self-assessment system of the Board of Commissioners.

Nomination and Remuneration Committee Recommendations
The Nomination and Remuneration Committee provides recommendations to the Board of Commissioners within their areas responsibility. Throughout 2018, the recommendations of the Nomination and Remuneration Committee were as follows:
1. Recommendation on the remuneration of the Board of Directors and Board of Commissioners’ honorarium for 2018.
2. Recommendations for the nomination of the composition of the Board of Commissioners and Directors, including Independent Commissioners, with a term of office since the closing of the Annual
GMS for the financial year 2017 until the closing of the
Company’s Annual GMS for financial year 2020, which will be held in 2021.
3. Recommendation on the criteria and process for evaluating the performance of the Board of Commissioners, Directors and Committees under the Company’s Board of Commissioners.

Board of Directors Succession Policy
Board of Directors’ succession planning is the responsibility of the Nomination and Remuneration Committee in preparing for regeneration and maintaining continuity of leadership in the future. In order to realize the process and mechanism for the selection and replacement of members of the Board of Directors and Board of Commissioners that are transparent, accountable and accountable, the appointment and dismissal is based on the principles of professionalism and GCG.

As a public company, the appointment and dismissal of the Board of Directors refers to the OJK regulation Number 33/POJK.04/2014 concerning Directors and Board of Commissioners of Issuers or Public Companies. The appointment of prospective members of the Board of Directors is carried out through a series of procedures, namely the determination of prospective candidates, screening and testing of competence. Candidates for the Board of Directors must meet formal requirements, material requirements and other stipulated requirements.

To get the best candidates, the Company always prioritizes aspects of professionalism and governance, both for candidates coming from the Company’s internal (talent management system) and from external parties. Candidates selected through this mechanism are then submitted through the GMS for approval.

Nomination and Remuneration Committee Competency Development
Throughout 2019, members of the Company’s Nomination and Remuneration Committee attended various programs to increase the competence in the forms of trainings, workshops, conferences, seminars, as per the following table:

 

 

Indocement, a producer of Semen Tiga Roda Cement and Semen Rajawali