Jakarta, CNBC Indonesia – The administration of President Joko Widodo (Jokowi) has put pressure on Government Regulation (PP) Number 23 concerning Amendments to Government Regulation Number 45 of 2005 concerning the Establishment, Management, Supervision and Dissolution of State-Owned Enterprises (BUMN).
In Article 27 Paragraph 2 of the PP, it is stated that if there is a state-owned company that makes a loss, the directors must be responsible for the loss. This is a form of obligation of the board of directors as written in Paragraph 1.
“Each member of the Board of Directors is personally responsible for the loss of the BUMN if the person concerned is guilty or negligent in carrying out his duties in accordance with the provisions referred to in paragraph (1),” the article reads as reviewed by CNBC Indonesia, Sunday (12/6/2022).
In fact, in Article 27 paragraph 3, the board of directors whose company suffers a loss can be sued in court.
“On behalf of Perum, the Minister may file a lawsuit against a member of the Board of Directors who due to his/her mistake or negligence has caused a loss to Perum,” the article reads.
However, there are situations where directors are not held accountable. This is described in Article 27 Paragraph 2A/ which reads as follows:
2a) Each member of the Board of Directors shall not be liable for losses as referred to in paragraph (2) if they can prove:
a. the loss is not due to his fault or negligence;
b. has carried out Management in good faith and prudence for the benefit and in accordance with the aims and objectives of the BUMN;
c. has no conflict of interest either directly or indirectly over Management’s actions resulting in loss; and
d. has taken action to prevent the occurrence or continuation of the loss.
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