This Charter of the Board of Directors (“BOD”) of PT KGI Sekuritas Indonesia (the “Company”) serves as a guideline to:
a. Ensure that BOD act in a responsible and ethical manner in the course of their professional activities by applying corporate governance best practices;
b. Protect the interests of stakeholders;
c. Enhance 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 BOD 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 Brokerage and Underwriting 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 BOD shall be comprised of at least 2 (two) members as follow:
(i) 1 (one) member as President Director;
(ii) At least 1 (one) member as Director.
b. At least 1 (one) member of the BOD must hold an Underwriter Representative License as the responsible person for supervising Underwriting activities;
c. At least 1 (one) member of the BOD must hold a Broker-dealer Representative License as the responsible party for supervising Broker-Dealing activities.
a. All members of the BOD must be domiciled in Indonesia;
b. Each member of the BOD is required to hold a Underwriter Representative or Broker-dealer Representative license;
c. Each member of the BOD must pass the fit and proper test required by the Financial Services Authority;
d. Each member of the BOD must meet the requirements of integrity, financial reputation, competence and expertise in the Capital Market and/or Financial Industry as detailed below:
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 support the development of Securities Companies conducting Brokerage and Underwriting activities and the Indonesian Capital Market.
Competency and Expertise Requirements:
1) Having adequate Capital Market expertise relevant to his/her position and also at least holds a diploma qualification; and/or
2) Having at least 2 (two) years of experience in companies engaged in capital market and/or financial services.
Financial Reputations Requirements:
Within 5 (five) years prior to appointment and during his/her tenure:
1) Never been declared bankrupt;
2) Never been found guilty of causing a company to be declared bankrupt.
Members of the BOD are prohibited from seeking employment in other companies or institutions in and outside Indonesia except as member of the Board of Commissioners of the Indonesia Stock Exchange, Clearing Guarantee Institution or Depository and Settlement Institution.
CONTINUING PROFESSIONAL EDUCATION
All BOD members are required to attend continuing professional education at least once every 2 (two) years.
TERM OF OFFICE
a. Members of the BOD shall be appointed and dismissed by the General Meeting of Shareholders (“GMS”);
b. Each members shall be appointed for a period of 3 (three) years and may be reappointed;
c. The term of office will automatically end if a member of the BOD:
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 criminal offence;
4) Is in prolonged absence;
5) Has passed away;
6) Does not meet the regulatory requirements;
7) Has been dismissed pursuant to a resolution of the GMS.
d. A member of the BOD may resign from his/her position subject to regulatory approval by submitting written request to the Company by stating the purpose of his/her resignation.
a. In the event that the license of the Underwriter Representative and/or Broker-Dealer Representative held by a member of the BOD is temporarily suspended, the member of the BOD shall not perform the functions, duties and authority as a member of the BOD until the license of Underwriter and/or Broker-Dealer Representative has been reinstated by OJK;
b. In the event that the license of the Underwriter Representatives or Broker-Dealer Representatives of a member of the BOD who is in charge of the Company’s Brokerage or Underwriting activities is revoked while a Director with the requisite license is required, the member must be replaced with another member of the BOD within a period of 3 (three) months.
DUTIES, RESPONSIBILITIES AND AUTHORITIES
a. The duties and responsibilities of the BOD are in accordance with the Articles of Association of the Company and the legislation in force;
b. The BOD has the responsibility for the sound and prudent management, direction and performance of the Company and its business;
c. The BOD has overall responsibility for risk management and for reviewing periodically the effectiveness of the system of internal control and risk management approach;
d. The BOD shall implement Corporate Governance practice in its business activities and at all organization level and strictly adhere to the Company’s codes of ethics;
e. The BOD must ensure that proper follow-up is carried out on audit findings and recommendations raised by the Board Of Commissioners (“BOC”) or OJK relating to risk management, compliance, and internal audit;
f. The BOD exercises all the powers and authorities as provided in the AOA. For certain actions as provided in the AOA, the BOD must first obtain a written approval from the BOC.
MEETING OF THE BOARD OF DIRECTORS
a. Every policy and strategic decision must be decided at the BOD meeting;
b. The BOD must hold a meeting at least 1 (one) time in every 2 (two) months. Additional meetings may be scheduled if needed to discuss and resolve on urgent items;
c. The meeting may be held if majority of all members of the BOD are present;
d. Each member of the BOD must attend at least 75% (seventy five percent) of the total BOD meetings held during the period of 1 (one) year;
e. Resolutions of the meeting of BOD shall be adopted unanimously by all Directors. In the event a unanimous consensus cannot be reached, the resolution shall be submitted by the BOD to the BOC for consideration and resolution;
f. All BOD meetings are required to be summarized into minutes of the meeting signed by the meeting chairman. Dissenting opinions arising during the BOD meeting must be well documented in the minutes along with the reason(s) of the dissenting opinion.
g. BOD may adopt valid resolutions without convening a BOD meeting provided that all BOD members have been notified in writing and have granted their approval in writing on the resolution;
h. Areas concerning meeting procedures which are not covered under this Charter shall be governed and construed in accordance with the Articles of Association.
REPORTING AND ACCOUNTABILITY
a. The BOD shall act in the Company’s interest and be responsible to the shareholders;
b. The BOD must provide information/data that is accurate, relevant and timely to the BOC;
c. The BOD shall deliver the annual report to GMS within 6 (six) months of the financial year end after it has been reviewed by the BOC to allow for accountability through transparent and proper performance evaluation.
CONFLICTS OF INTEREST
a. Members of the BOD are obliged to avoid conflict of interest, potential conflict of interest and even perceived conflict of interest. In the event of the foregoing conflict of interest, members of the BOD shall disclose the said potential conflict of interest and are prohibited from taking action that may jeopardize the interest of the Company;
b. Each BOD member 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 one.
EFFECTIVE DATE OF CHARTER
This Charter, including any amendments hereof, shall become effective upon its announcement following the approval by the Board of Directors