Good Corporate Governance

The commitment of GCG implementation is an absolute thing for Angkasa Pura II. GCG is implemented through infrastructure strengthening and sustainable improvement of system and procedure to support a more effective GCG implementation in Angkasa Pura II.

In realizing a continuously growing and highly competitive company, Angkasa Pura II has developed the structure and system of Good Corporate Governance by adhering to GCG principles in accordance with the rules and the regulations, as well as the best practices. GCG implementation is a follow-up to Decree of the Minister of State-Owned Enterprise BUMN No. KEP- 117/M-MBU/2002 dated July 31, 200 that subsequently amended by Regulation of the Minister of State-Owned Enterprise No. PER-01/MBU/2011 dated August 1, 2011 concerning the Implementation of Good Corporate Governance in SOE (State-Owned Enterprise), which stated, “SOE shall carry out its operations by adhering to GCG principles of transparency, accountability, responsibility, independence, and fairness”.

The spirit of GCG implementation in Angkasa Pura II is the motivation and determination of Angkasa Pura II to become a company that continue to grow and improve with good quality of product and working process, Code of Conduct, including responsibility towards its environment.

The objectives of GCG implementation in Angkasa Pura II, namely:

  1. Controlling and directing the relationship between the structures of the Company (Shareholders, Board of Commissioners, Board of Directors), employees, customers, business partners, as well as the community and environment properly in which the interest of all parties are fulfilled.
  2. Encouraging and supporting the development of Angkasa Pura II.
  3. Managing the resources with more credibility.
  4. Managing the risks better.
  5. Enhancing accountability to the stakeholders.
  6. Preventing any deviation in the management of Angkasa Pura II.
  7. Improving the working culture of Angkasa Pura II.
  8. Improving Angkasa Pura II’s image to become better.

In order to realize these objectives, Angkasa Pura II is fully committed and consistent in enforcing GCG implementation by referring to formal regulations, which are the basis of GCG implementation in Angkasa Pura, namely:

  1. Law No. 19/2003 concerning State-Owned Enterprise/SOE (Article 5, paragraph 3).
  2. Regulation of No. PER-01/MBU/2011 concerning the Implementation of Good Corporate Governance in SOE (State-Owned Enterprise) as amended by Decree of the Minister of State-Owned Enterprise No. PER-09/MBU/2012 dated July 6, 2012.
  3. Decree of the Secretary of the Ministry of State-Owned Enterprise No. SK-16/S.MBU/2012 dated June 6, 2012 concerning Indicator/Parameter for Assessment and Evaluation of Good Corporate Governance Implementation in State-owned Enterprises.
  4. Laws No. 1/1995 concerning Limited Liability Company as amended by Law No. 40/2007 dated August 16, 2007.
  5. Joint Decree of Board of Commissioners and Board of Directors No. KEP.448/UM.004/X/AP II – 2007 and No. KEP.02.03.01/00/10/2007 461 concerning Implementation Guidelines of Good Corporate Governance and Code of Conduct in PT Angkasa Pura II (Persero).

GCG principles in accordance with PER-01/MBU/2011 dated August 1, 2011 concerning the Implementation of Good Corporate Governance in State-Owned Enterprises, namely:

  1. Transparency is openness in decision making process and disclosing material and relevant information about the company.
  2. Accountability is clarity of function, implementation, and responsibility of Organ of the Company so that corporate governance shall be implemented effectively.
  3. Responsibility is suitability of corporate governance against laws and regulations as well as principles of a healthy corporate.
  4. Independency is condition in which the company is professionally managed without any conflict of interests and influence/pressure from any parties that is not in accordance with the laws and principles of a healthy corporate.
  5. Fairness, is justice and equality in fulfilling the rights of stakeholders that happened based on agreements and laws.

Angkasa Pura II defines the direction of GCG implementation in GCG Roadmap, which is expected to be used as the guidelines in implementing GCG at all levels. GCG Roadmap is targeted to establish GCG as the reference in every operational activities. The ultimate goal of GCG Roadmap is the realization of Angkasa Pura II as a good corporate citizen. With the achievement of the ultimate goal, Angkasa Pura II is confident to be able to improve and maintain company’s performance continuously.

In interpreting Good Corporate Governance, Angkasa Pura II has basic principles, i.e. encouraging GCG as a part of corporate management through the implementation of a system that reflects the principles of information disclosure, accountability, equality, and responsibility.

Angkasa Pura II has implemented various initiatives of GCG implementation, both independently and supported by an independent party, in achieving a sustainable governance.

During 2012, several programs have been completed in order to strengthen GCG implementation in Angkasa Pura II, including:

  1. GCG Implementation Assessment for the period of 2011
  2. Revision of GCG Guidelines
  3. Revision of Code of Conduct
  4. Signing of Integrity Pact
  5. Circular Letter on the Restriction of Parcel/Gift Acceptance
  6. Intensive GCG socialization to all employees of Angkasa Pura II
  7. Establishment of Compliance Unit under Risk Management
  8. Circular Letter on the Restriction of Having Business for Board of Directors and Employees at airports managed by Angkasa Pura II

Judicial basis of GCG assessment in Angkasa Pura II refers to Regulation of the Minister of State-Owned Enterprise No. PER-01/MBU/2011 dated August 1, 2011 concerning the Implementation of Good Corporate Governance in State-Owned Enterprises.

Parameter indicator used in the self-assessment is Company Corporate Governance Scorecard (CCGS) issued by Ministry of SOE. During its development, CCGS has undergone several developments and improvements, namely in 2005, 2008, and 2011.

In 2012, the GCG assessment implementation conducted through internal independent Self-Assessment using assessment parameter indicators based on Secretary of Ministry of SoE Decree Number: SK-16/S.MBU/2012 Regarding Indicators of Good Corporate Governance Evaluation and Assessment Parameter for State-Owned Enterprise dated June 6, 2012.

The indicator/parameter consists of:

  1. Commitment to sustainable implementation of good corporate governance
  2. Shareholders and GMS (General Meeting of Shareholders)/capital owners
  3. Board of Commissioners
  4. Board of Directors
  5. Information disclosure and transparency
  6. Other aspects

2012 GCG Self Assessment

Result of GCG self assessment conducted by internal party in 2012 shows that Angkasa Pura II is categorized as “GOOD” with score achievement of 82,08%, which include 6 (six) assessed aspects: Commitment to sustainable implementation of Good Corporate Governance, Shareholders and GMS, Board of Commissioners, Board of Directors, Information Disclosure and Transparency, Other Aspects.

Information on GCG Self Assessment Assesor

In 2012, GCG self assessment is conducted by internal party of Angkasa Pura II by using self assessment method. While in 2011, GCG Assessment was conducted by Financial and Development Supervisory Institution (BPKP) – Representative of Banten Province.

Governance Structure

In accordance with Law No. 40/2007 Chapter 1 concerning the General Provision, Article 1, organ of the Company include General Meeting of Shareholders, Board of Directors and Board of Commissioners.

  • General Meeting of Shareholders, hereinafter referred to as RUPS, is an Organ of the Company that has the authority not granted to Board of Directors or Board of Commissioners within specific limits in accordance with the Regulations and Laws and/or Articles of Association.
  • Board of Directors is an Organ of the Company that is authorized and fully responsible for the management of the Company for the benefit of the Company, in line with the purposes and objectives of the Company, and is also representing the Company, both inside and outside the court in accordance with the provisions of the Articles of Association.
  • Board of Commissioners is an Organ of the Company which is in charge and collectively responsible for overseeing, generally and/or specifically, as well as advising Board of Directors in accordance with the Articles of Association.

These organs of the Company play an important role for the success of GCG implementation. They perform their functions in accordance with the Law and Regulations, Articles of Association and other provisions based on the principle that each organ has the independence in carrying out their duties, functions and responsibilities for the benefits of the Company.

RUPS, Board of Commissioners and Board of Directors shall respect each other in terms of duties, responsibilities and authorities other in correspondence with the Laws and Regulations as well as Articles of Association.

In carrying out its management duties for the Company, Board of Directors shall be assisted by Corporate Secretary and Internal Auditor as well as other business units, which also carry out the management functions of the Company.

In carrying out its overseeing duties, Board of Commissioners may establish committees in which one member or more of the committees are also the members of Board of Commissioners. These committees are responsible to the Board of Commissioners.

Governance Mechanism

Governance Mechanism is the mechanism of GCG implementation that is reflected in a strong system. This transforms into a crucial matter because it is not enough for GCG implementation to merely rely on the pillars of governance structure, instead, it is necessary to have clear rules in the form of a mechanism. Governance mechanism can be interpreted as rules, procedures, and clear relationship between the parties that make the parties that those that conduct control or supervision on the decision.

Angkasa Pura II has Code of Conduct for Good Corporate Governance that had been approved by the Joint Decree of Board of Commissioners No.KEP.258.1/GCG/X/APII-2004 and Decree of Board of Directors No. KEP.484.1/ KS.005/APII-2004. The company continues to improve GCG policy (GCG soft-structure) in line with the needs of business processes and implementing provisions of GCG for the company.

In addition to GCG guidelines, Angkasa Pura II has developed a Code of Conduct, the Audit Committee Charter, Internal Audit Charter as well as various policies and procedures in supporting the implementation of good governance. All policies and procedures are intended to encourage the Company to be able to check and balance on any business activity based on the principles of good corporate governance.

General Meeting of Shareholders (RUPS) as the highest authority in Angkasa Pura II, has the authority not granted to the Board of Commissioners or the Board of Directors within specific limits in accordance with the Regulations and Laws and/or Articles of Association, including: authority to request for the responsibility of Board of Commissioners and Board of Directors in relation to the management of Angkasa Pura II, change the Articles of Association, appoint and dismiss members of the Board of Directors and members of the Board of Commissioners, and define the division of management duties and authority among the Directors and other parties.

During the year 2012, Angkasa Pura II held 1 (one) Annual General Meeting of Shareholders and 1 (one) Extraordinary General Meeting of Shareholders.

Annual General Meeting of Shareholders

On May 15, 2012, Angkasa Pura II held the Annual General Meeting at the Ministry of State-Owned Enterprises Infrastructure & Logistics Meeting Room on 12th Floor.

Extraordinary General Meeting of Shareholders

On July 19, 2012, Angkasa Pura II held Extraordinary General Meeting of Shareholders at the Ministry of State-Owned Enterprises Building on 12th Floor.

Angkasa Pura II realizes that the implementation of corporate risk management is increasingly become a requirement, because its success will be factor the success key to achieve the goal and win the competition at global level.

Angkasa Pura II as a company engaged in airport service and airport related service keep improving in order to achieve its vision and mission. Transformation program roll continuously in all field include the support function such as risk management. Corporate realize, the implementation of corporate risk management nowadays is something that urgent, and its one of the way to achieve the goal and be factor that winning the competition.

The implementation of risk management can increase the shareholder value, as well as give the comprehensive image to the Company’s stakeholder and manager about potential opportunities or disadvantages, so the decision and internal policies maker have the data availability and information about Company’s performance, thereby making decision-making more effective and efficient.

In business activities, Angkasa Pura II faces some of embedded risks. Those risks generally can be divided as the risks that affect human, company’s asset, environment, and reputation. Meanwhile in particular, risks according to its characteristic are failure of flight, failure of airport operational, failure of service, and incompliance to the regulation. Those various risk are handled through the effort of risk prevention, risk mitigation, or transfer risk. Evaluation is always conducted periodically in accordance with change in risk parameters.

Corporate continuously develop and improve the risk management framework and internal control structure that integrated and comprehensive, so can provide information about potential risk earlier and further adequate action can be done to minimize the impact of the risk. This risk management framework is outlined in the policies, procedures, transaction limit, authority, and other provisions as well as various risk management tools that applied in all of business area.

In order to develop appropriate risk management align with international airport standards, management Angkasa Pura II has established risk profile, and implement safety compliance and security services through compliance and also the development of Enterprise Risk Management-Integrated Framework and Application Techniques, published by The Committee of Sponsoring Organizations of the Treadway Commission (COSO-ERM).

The essence of implementation of risk management is the adequacy of procedure and methodology of risk management, so the company’s business activities remain under control or manageable in the limit that can be accepted and advantageous.

Basic of The Risk Management Implementation

As a State-Owned Enterprise, Angkasa Pura II shall be objected to the rule and the regulation that exists. In accordance with the Decree of Menteri Negara BUMN RI Number Per-01/MBU/2011article 25, Angkasa Pura II is obliged to do things as follows:

  1. Board of Directors, in every decision-making or corporate action, should consider any risk of the business.
  2. Board of Directors shall establish and implement the corporate risk management program in an integrated manner as a part of GCG program implementation.
  3. Implementation of the risk management program can be done by forming a separate unit below the Board of Directors; or giving assignments to the existing work unit and relevant to do the risk management function.

Risk Management Administrator

Angkasa Pura II set the Corporate Risk Management Unit as the responsible party for being the administrator of Corporate Risk Management with the scope of work including the Head Office and 12 (twelve) Angkasa Pura II Branch Offices, and also with the work specialization such as Safety Management System, Facility Risk Management, and Business Risk Management.

Risk Management Policies

Angkasa Pura II Risk Management Policies refers to the ISO 31000:2000 Risk Management-Principles and Guidelines, which have been adopted as national standard SNI ISO 31000:2011.

Risk Management Strategy

Angkasa Pura II has laid the framework for developing a risk-based management in the form of Corporate Standard Risk Management. The development and implementation of risk management has been initiated since 2006 by using internal method approach as a part of risk management and full completion is expected in 2015, which is in line with the Corporate Risk Management Roadmap that is proposed in Corporate RJPP Rolling Plan Program Year 2011-2015.

As a supporting factor in order to achieving the strategy of risk management implementation, Angkasa Pura II seeks to inculcate the culture of risk awareness in employees by providing adequate understanding about risk factors associated with work and/or daily functions.

Creating GCG as a Culture

Angkasa Pura II always tries to create an organizational culture that marks integrity as a high value. The approach of culture internalization has been done through the intervention of three aspects, leadership, system, and employees. With that current approach, the culture of Angkasa Pura II has become a discipline (soft skills) which is practiced by the Board of Commisioner, the Board of Management, and the employees in doing their daily jobs, aside from being written in company policies and procedures.

Angkasa Pura II have determined a strong core value, which is THE BEST, with the following elaboration:

Code of Conduct

In order to reach the success for the company, the GCG implementation has to be based with high integrity. Therefore, in 2007, Angkasa Pura II had compiled Pedoman Perilaku (Code of Conduct) which explained the morality of the company in running the business. The Code of Conduct book also contained the statements of employees’ commitment which were signed personally by the employees of Angkasa Pura II and the Board of Management in 2008 as their own personal commitment to comply with the Code of Conduct. The Code of Conduct was documented at Unit Sekretaris Perusahaan (Corporate Secretary Unit). Regularly, the employees renew their commitment statements to the Code of Conduct.

The Validity and Content of Code of Conduct

Code of Conduct is applicable to every individual of Angkasa Pura II, starting from the Board of Commissioners, the Board of Management, and all employees of Angkasa Pura II. Other than that, the external parties in their involvement with Angkasa Pura II are also obliged to follow the regulations stated in the Code of Conduct.

Code of Conduct set the policy of ethical values which were stated in an explicit way as a standard of behavioural actions, that must be followed by every individual of Angkasa Pura II.

Some important matters set in the Code of Conduct of Angkasa Pura II, are stated below:

  • Joint statement of commitment
  • Signature of commitment with the Board of Commissioners, the Board of Management, States of Employees and Employees.
  • Vision, mission, and organizational culture.
  • The commitment of the company for their stakeholders.
  • The commitment and the behavioural actions of every individual of Angkasa Pura II.
  • Enforcement of Code of Conduct.
  • The statements of commitment to obey the Code of Conduct.

In order to keep an ethical relationship with all parties, Angkasa Pura II formulate the commitment of the company to all shareholders and stakeholders, as stated below:

  1. Commitment to Shareholders, by giving the best company values from the financial and non financial aspect; by giving a complete, accurate, and on-time report, and also by implementing a good business management.
  2. Commitment to Customers, in order to maintain the reputation, integrity, and credibility of the company, and also by improving a harmonious relationship between the company and the customers.
  3. Commitment to every individual of Angkasa Pura II, in order to manifest a high-quality and fair relationship, and also able to improve the intensity and participation quality of every individual of Angkasa Pura II. The company will treat every individual of Angkasa Pura II as an employee of the company fairly.
  4. Commitment to Suppliers, company should maintain an honest and fair relationship in doing the business.
  5. Commitment to Business Partners, the relationship between company and its business partners should be covered with equality, transparency, and business ethics.
  6. Commitment to Working Partners, constantly doing coordination to maintain the interest of the company and provide proportional access to the smoothness of working partners' duties performance.
  7. Commitment to Sister Companies and Affiliated Companies, constantly by doing guidance, giving appreciation, and also by keeping the independence level of sister company and affiliated company in developing the business overall.
  8. Commitment to Government, in running the business professionally, the company will notice and obey the legislations, and also the government policies related to the activities of the company, and applying ethical behavior in the relationship with the government institutions.
  9. Commitment to Public and Environment, by actualizing the corporate social responsibility as the manifestation of Good Corporate Citizenship.

The Disclosure of Code of Conduct to all Individual of Angkasa Pura II

Socalization process to the implementation of Code of Conduct has been constantly doing to all individual of Angkasa Pura II, starting from the top management level to the operational level through various medias owned by Angkasa Pura II, including the usage of information technology media. The media is easily accessed by all employees any time. Periodically, to all individual of Angkasa Pura II, memo and circular letters are distributed by the Board of Management about the implementation of business ethics.

The media to socialize the distribution of Code of Conduct are:

  • Website
  • Pocket book
  • Banner
  • Bulletin
  • Newsletter
  • Commitment statements
  • Advertisements in newspapers
  • And others.

Aside from that, Angkasa Pura II socializes the Code of Conduct in upgrading forum or briefing for new employees, the moment of signing the commitment statements to the Code of Conduct by all individual of Angkasa Pura II, and also by doing socialization in building Kelompok Pemeriksa Pelanggaran Disiplin Karyawan (KP2DK) team through all the employees.

Before signing the statement of obedience to the Code of Conduct, every employee at Angkasa Pura II are obliged to read, understand, and live up to the Code of Conduct values rightfully.

The efforts in Applying and Enforcing The Code of Conduct

In 2012, the effort of enforcing the Code of Conduct was implemented in various ways, some of them were:

  1. The caretaker of enforcing the ethics and behaviour for all individuals at Angkasa Pura II is the Board of Management. In order to enhance the enforcement effectiveness of the Code of Conduct.
  2. A report about the act of violation. Every employee is obliged to report any violation on the implementation of the Code of Conduct to the KP2DK team at their own workplace. All report must be specified with data and/or accurate supporting evidence in order to process the violation furthermore. Every violation to the Standards of Ethics and Behaviour of the Company will be charged with a penalty according to the level of violation.
  3. The penalty of the violation. Every individual of Angkasa Pura II will be charged to a penalty if found to be guilty in doing any violation towards the Code of Conduct. The penalty for the employees will be decided by the Board of Management, while the penalty for the Board of Management and the Board of Commissioners will be decided by the Shareholders through RUPS.