This Charter of the Board of Commissioners (“BOC”) of PT KGI Sekuritas Indonesia (the “Company”) aims to:
a. Ensure that the BOC acts in a responsible and ethical manner in the course of their professional activities by applying corporate governance best practices;
b. Protect the interests of the stakeholders;
c. Enhance the BOC’s compliance with all applicable laws and code of ethics
The legal basis, prerequisites, duties, responsibilities and authorities, meeting policy as well as reporting and accountability of the BOC are set forth in this Charter as follows:
The legal basis of this charter includes:
a. Law No. 8 of the Republic of Indonesia of Year 1995 governing the Capital Market;
b. Indonesia Companies Act No. 40/2007 governing Limited Liability Company;
c. OJK Regulation No. 20/POJK.04/2016 governing licensing of Securities Companies conducting Underwriting and Brokerage and activities;
d. OJK Regulation No. 57/POJK.04/2017 and Circular Letter No. 55/SEOJK.04/2017 governing Corporate Governance; and
e. Articles of Association (“AOA”) of the Company
a. The BOC shall consist of one or more members of the BOC. If more than one person is appointed as member of the BOC, then one of them may be appointed as the President Commissioner;
b. The total number of members of the BOC must not be more than the total number of members of the Board of Directors (BOD);
c. The Company is required to have at least 1 (one) Independent Commissioner, and if the BOC is consist of more than 2 (two) members, then the number of Independent Commissioners shall meet at least 30% (thirty percent) of the total members of BOC.
a. Each member of the BOC must pass the fit and proper test required by the Financial Services Authority;
b. Each member of the BOC must meet the requirements of integrity, financial reputation, competence and expertise in the Capital Market and/or Financial Industry as follows;
1) Having the legal capacity to act or conduct legal actions;
2) Having a good character, moral and integrity;
3) Never having been convicted of or found guilty of criminal offence;
4) Having the commitment to comply with applicable laws and regulations;
5) Having the commitment to develop and improve the performance of Securities Companies conducting Brokerage and Underwriting activities.
Competency and Expertise Requirements:
1) Having adequate Capital Market expertise relevant to his/her position; and/or
2) Having at least 2 (two) years of experience in companies engaged in capital market and/or financial services;
Financial Reputations Requirements:
1) Never having been declared bankrupt;
2) Never having been found guilty of causing a company to be declared bankrupt;
Requirements as Independent Commissioner:
An Independent Commissioner must meet the following additional requirements:
1) Not being a person who is employed or has the authority and responsibility to plan, lead, control or oversee the activities of the Company within the last 6 (six) months, except for re-appointment as an Independent Commissioner of the Company for such period;
2) Not to own any shares directly or indirectly in the Company;
3) Having no affiliation with the Company, members of the BOC or BOD of the Company, or major shareholders of the Company; and
4) Having no direct or indirect business relationship related to the Company’s business activities.
Members of the BOC are prohibited from taking up an employment in other Securities Companies in Indonesia.
CONTINUING PROFESSIONAL EDUCATION
All BOC members are required to attend continuing professional education at least once every two years.
TERMS OF OFFICE
a. Members of the BOC shall be appointed by the General Meeting of Shareholders (“GMS”) for a period of 3 (three) years and may be reappointed;
b. The term of office will automatically end if a member of the BOC:
1) ceases to have the legal capacity to act or take legal actions;
2) has been declared bankrupt or is found guilty of causing a company to be declared bankrupt;
3) has been convicted of or found guilty of a criminal offence;
4) is in prolonged absence;
5) has passed away
6) does not meet the regulatory requirement; and/or
7) has been dismissed pursuant to a resolution of the GMS.
DUTIES, RESPONSIBILITIES AND AUTHORITIES
a. The BOC is responsible for supervising the management policies and general operations of the Company, and providing independent advice to the BOD;
b. In the event that the BOC participates in decision-making on matters in accordance with the laws and AOA, the decision must be made in his/her capacity as a supervisor and advisor to the BOD;
c. The BOC must examine and supervise the implementation of Corporate Governance, Business Plan, Risk Management, Compliance and Internal Audit;
d. The BOC is responsible for approving the Business Plan prepared by the BOD;
e. The BOC is required to perform, through the Independent Commissioner, its supervisory functions by examining the followings:
(i) Financial information submitted by the Company to the Regulators;
(ii) Independence, scope of work and fees regarding the appointment of external auditors;
(iii) Audit plan and its execution by the external auditors;
f. The BOC must ensure that the BOD follow up on the audit findings and recommendations relating to risk management, compliance, and internal audit as well as supervision results raised by BOC and the Financial Services Authority;
g. The BOC must supervise the committees that are established (if any) to ensure they perform their duties effectively;
h. The BOC are required to:
(i) Report to the Financial Services Authority within 3 (three) working days of knowledge of any law violation relating to the financial services sector by any employee of the Company which may endanger the business activities of the Firm;
(ii) Hold a meeting by inviting the BOD to discuss the implication of such law violation.
i. The BOC must comply with all duties and authorities as stipulated in the Company’s AOA;
j. The BOC in performing its duties has the authority to access all documents, visit the Company’s premises and interview the Company’s employees;
k. The BOC has the authority to review information on all transactions to be performed by the Company.
MEETING OF THE BOARD OF COMMISSIONERS
a. The BOC must hold a meeting at least 1 (one) time in every 3 (three) months. Additional meetings may be scheduled if needed to discuss and resolve on urgent items;
b. The meeting may be held if majority of all members of the BOC are present;
c. A Meeting of the BOC may also be held by ways of teleconference, video conference, or other means of electronic media, unless stipulated otherwise by applicable laws;
d. The BOC may also adopt valid resolutions without convening a Meeting of the BOC, provided that all members of the BOC have been notified in writing and all members of the BOC have granted their approval on the proposal submitted in writing by signing such approval. The resolutions adopted in such a manner shall have the same legal effect as the resolutions lawfully adopted at a Meeting of the BOC;
e. Each member of the BOC must attend at least 75% (seventy five percent) of the total BOC meetings during the period of 1 (one) year;
f. The decision of the meeting must be made based on the followings:
1) Approval by all members of the BOC; or
2) Majority vote, in the event of non-unanimous consent by BOC members
g. All BOC meetings are required to be summarized into minutes of the meeting signed by the meeting chairman. Dissenting opinions arising during the BOC meeting must be well documented in the minutes along with the reason(s) of the dissenting opinion.
REPORTING AND ACCOUNTABILITY
a. The BOC shall act in the Company’s interest and be responsible to the shareholders;
b. The BOC shall report on the effectiveness of the implementation of the supervisory duties and responsibilities of the BOC by submitting an Annual BOC Supervision Report at the General Meeting of Shareholders.
CONFLICTS OF INTEREST
a. Members of the BOC are obliged to avoid conflicts of interest, potential conflicts of interest and even perceived conflict of interest. In the event of the foregoing conflict of interest, members of the BOC shall disclose the said potential conflict of interest and are prohibited from taking action that may jeopardize the interests of the Company;
b. Each member of the BOC is prohibited from:
(i) Misusing or abusing his/her authority for personal interest or that of third-party;
(ii) Obtaining or receiving direct or indirect personal gain from the Company’s business activities other than legitimate income.
EFFECTIVE DATE OF CHARTER
This Charter, including any amendments hereof, shall become effective upon its announcement following the approval by the Board of Commissioners.