Nomination and Remuneration Committe

 

The Nomination and Remuneration Committee is created basis for a certain period pursuant to the Articles of Association of the Company with the purpose to assist the Board of Commissioners in the determination of remuneration for the Board of Commissioners, the Board of Directors and the Committees as consideration for services provided to the Company.

Nomination and Remuneration Committee Charter

1.      BACKGROUND

The Nomination and Remuneration Committee (Committee) of PT Surya Toto Indonesia Tbk., (“Company”) is the committee established and being responsible to the Board of Commissioners of the Company (“Board of Commissioners”) to assist the implementation of tasks and responsibilities of the Board of Commissioners relating to the grant of recommendation for nomination and remuneration of members of Board of Commissioners, Board of Directors, the members of committees in Board of Commissioners level in accordance with the Good Corporate Governance (“GCG”) principles.

 

The Committee is established with the intention to support the implementation of supervision function of the Board of Commissioners in nomination and remuneration aspects of the members of the Board of Commissioners and the Board of Directors.

 

The legal foundation of Committee establishment is:

 

1.1.  The articles of association of PT Surya TOTO Indonesia Tbk;

 

1.2. Regulation of Financial Service Authority No. 34/POJK.04/2014 dated December 8, 2014 regarding Nomination and Remuneration Committee for Issuer or Public Company (“POJK No. 34/2014”);

 

1.3.  Law No. 40 Year 2007 regarding Limited Liability Company;

 

1.4.  Law No. 8 Year 1995 regarding Capital Market;

 

1.5.  Decree of the Board of Commissioners of PT Surya Toto Indonesia Tbk dated 31 May 2018 concerning Appointment of Members of the Nomination and Remuneration Committee.

 

Which entirely are in force upon the enforcement of this Committee Guidance.

 

 

2.      VISION AND MISSION

2.1.   Vision

To be the Committee having highly competence in assisting the Board of Commissioners in applying the Good Corporate Governance principles and the code of business principles of the Company in managing the human resources (“HR”) and the implementation of nomination and remuneration function for the members of the Board of Directors and the Board of Commissioners.

 

2.2.  Mission

Assisting the Board of Commissioners to perform the tasks and functions of the supervision as well as the grant of advice in implementing the GCG principles and the code of business principles of the Company in the process of nomination of candidates of Board of Directors and Board of Commissioners conducted gradually and sustainably in accordance with the prevailing GCG principles and the code of business principles of the Company by upholding the harmonious relationship of the Company with all relevant stakeholders.

 

 

3.      AIM AND OBJECTIVE

This guidance of Nomination and Remuneration Committee (“Guidance”) is intended as the guidance for the Committee in order it is able to perform its tasks and responsibilities efficiently, transparently, professionally, independently and accountably in accordance with the prevailing legislation.

 

The objectives of preparation and enforcement of this Guidance are:

 

3.1.  To give the guidance in determining the structure, membership and terms of service of the tasks of the Committee;

 

3.2.  To give the limitation of tasks, responsibilities and authority of the Committee in implementing its operational tasks; and

 

3.3.  To apply GCG related provisions which are applied but not set forth yet in the Company’s articles of association.

 

 

4.     STRUCTURE, MEMBERSHIP AND TERMS OF SERVICE

4.1.  Structure

 

4.1.1.      The Committee members consists of at least 3 (three) members with the compositions as follows:

 

a.    1 (one) Independent Commissioner;

 

b.    at least 1 (one) member of the Board of Commissioners; or

 

c.    at least 1 (one) executive officer under the Board of Directors supervising the human resource aspect;

 

provided that total members as referred to in item (c) above cannot be the majority in the Committee membership.

 

4.1.2.      Committee is chaired by the Independent Commissioner.

 

4.1.3.      Chairman and members of the Committee are appointed and dismissed by the Board of Commissioners

based on the resolution of meeting of the Board of Commissioners.

 

4.1.4.    If one the Committee members resigns or quits due to specific reason causing the membership is less than 3 (three) persons, at the latest within 60 (sixty) calendar days as of the occurrence, the Board of Commissioners is obliged to appoint the new Committee member to fulfill the minimum total member of the Committee to at least 3 (three) persons.

 

4.2.  Membership

 

4.2.1.      Requirements:

 

The members of Committee are obliged to fulfill the requirements as follows:

 

a.   Having high integrity, adequate capacity, knowledge and experience in accordance with its field of work and educational background as well as being capable of good communication;

 

b.    Having the sufficient knowledge in order to be able to understand the company’s GCG and the code of business principles of the Company, understand the determination nomination principles of the prospective Board of Commissioners, Board of Directors and its remuneration system;

 

c.  Having the knowledge on the articles of association of the company, legislation principles relating to the company’s operation, other legislation relating to GCG as well as the competence on nomination and remuneration;

 

d.  The independent chairman and members of committee do not have any affiliate relationship to the main shareholders, members of the Board of Commissioners or Board of Directors of the company;

 

e.   Having no business relationship, both directly and indirectly relating to the company’s business activity possibly causing the arising of conflict of interest;

 

f.    Is willing to prepare and sign the written statement relating to the independence requirements and there is no conflict of interest;

 

g.    Being able to cooperate and communicate properly and based on ethics as well as providing the sufficient time to perform the task properly and with added value;

 

h.    Being obliged to adhere to the code of business principles of the Company; and

 

i.     The members of the Board of Directors are prohibited to be the members of the Committee’s.

 

4.2.2.      Evaluation

The evaluation on the performance of the Committee’s members both individually and collectively will be conducted at the end of every fiscal year on self-assessment basis by using the evaluation method in a system stipulated in the resolution of Board of Commissioners from time to time.

 

4.3.  Term of Service

 

4.3.1.      The term of service of the Committee’s members being the members of the Board of Commissioners is the same as that of the members of Board of Commissioners stipulated in the company’s articles of association.

 

4.3.2.     The term of service of the Committee’s members not being the members of Board of Commissioners is stipulated following the term of service of Board of Commissioners being the Committee’s members and is extensible without prejudice the right of the Board of Commissioners to dismiss them any time.

 

4.3.3.     The term of service of the Committee’s members appointed among the service period of Board of Commissioners follows the service period of such Board of Commissioners.

 

 

5.      TASKS, RESPONSIBILITIES AND AUTHORITIES

5.1.  Task

The Committee has the tasks and is responsible for giving the recommendation to the Board of Commissioners including but not limited to the matters as follows:

 

5.1.1.      Relating to the Nomination Function

 

a.    Preparing and giving the recommendation to the Board of Commissioners relating to the determination of:

 

  • Composition of position of members of Board of Directors and Board of Commissioners;

 

  • Policy and criteria required in Nomination process;

  • Evaluation policy of members of Board of Directors and Board of Commissioners Commissioners Committee and Executive Officer;

  • Development program for members of Board of Directors and Board of Commissioners;

 

b.    Giving the suggestion on the candidate of members of Board of Commissioners and/or Board of Directors to the Board of Commissioners to be submitted to the General Meeting of Shareholders of the Company;

 

c.    Determining the criteria to be implemented in identifying the candidates, examining and approving the

candidates of members of Board of Directors, Board of Commissioners and in taking that measure the Committee will apply the principle that each candidate will be able and appropriate for the relevant position and qualified for that position with the experience, capability and other relevant factors;

 

5.1.2.      Relating to Remuneration Function 

 

a.    Giving the recommendation to the Board of Commissioners on structure, policy and amount of remuneration for Board of Commissioners and Board of Directors to be submitted to the Company’s General Meeting of Shareholders.

 

b.    Assisting the Board of Commissioners to evaluate the performance of the members of Board of Directors and/or Board of Commissioners based on the criteria already established as the evaluation material;

 

c.    The Committee is obliged to follow the remuneration procedure for the members of Board of

Commissioners and Board of Directors to as follows :

 

  • Preparing the remuneration structure in terms of salary, honorarium, incentive and allowance invariably and variably;

 

  • Preparing the policy for the remuneration structure; and

 

  • Preparing the amount of remuneration structure.

 

d.    Structure, policy and amount of remuneration as referred to in Chapter 5.1.2 Article (e) must have the reasonable feasibility, appropriateness as well as the benchmark by considering:

 

  • Remuneration applied in the Company’s business activity industrial sector from time to time;

 

  • Financial obligation and fulfillment of the Company’s financial obligation;

 

  • Individual work performance of the members of Board of Directors and/or Board of Commissioners;

 

  • Performance, task, responsibility and authority of the members of Board of Commissioners andBoard of Directors; and

 

  • Invariable and variable allowance balance by taking into account the feasibility and whole remuneration for the Board of Commissioners and the Board of Directors.

 

e.   The Committee can consider the input from the members of Board of Directors and Board ofCommissioners relating to the policy to be recommended.

 

f.     Structure, policy and amount of remuneration must be evaluated by the committee at least once a year.

 

g.   Performing other tasks given by Board of Commissioners relating to the remuneration in accordance with the prevailing provision.

 

5.1.3.      Conflict of Interest

In the event the Committee members have the conflict of interest to the suggestion recommended, it is obliged to disclose in such suggestion the existence of the conflict of interest as well as the considerations underlying such suggestion.

 

5.2.  Responsibility

 

5.2.1.      The Committee is responsible to the Board of Commissioners.

 

5.2.2.      The Committee’s accountability is submitted to Board of Commissioners in terms of reports as follows :

 

Minutes of Meeting;

 

5.2.3.     Committee members who are still or who do not hold the position any longer as the Committee members must keep the confidentiality of the document, data and information of the company obtained when they hold the position of the Committee members both internal and external and only use it for the interest of the task performance.

 

5.2.4.      Committee members are prohibited to abuse the important information relating to the Company for personal

use.

 

5.2.5.   Committee members in performing their tasks and responsibilities are obliged to adhere to the prevailing regulation and the code of business principles of the Company as well as are prohibited to earn any personal gain both directly and indirectly from the Company activities other than from the honorarium together with the facilities and other allowance.

 

 

6.      MEETING AND REPORTING

6.1.  Meeting

 

6.1.1.      The Committee can hold the meeting at any time at least 3 (three) times in 1 (one) fiscal year.

 

6.1.2.      The meeting can only be held if attended by majority of total Committee members including the Chairman.

 

6.1.3.      If deemed necessary, the Committee can invite other party relating to the meeting material to attend the

meeting upon prior approval from the Board of Commissioners.

 

6.1.4.   The meeting is chaired by the Committee Chairman. The Chairman may delegate his/her authority as the chairman of meeting to one of the attending members.

 

6.1.5.     The Meeting can be held through the teleconference media, conference video or other electronic media facility enabling all Committee meeting participants to look and listen directly to each other as well as to participate in the meeting.

 

6.1.6.     A Committee member who attend and is appointed by the Committee Chairman must record and prepare the minutes of meeting.

 

6.1.7.     The resolution of the Committee meeting is adopted amicably for consensus. In the event of failure to reach the deliberation for consensus, the resolution is adopted based on majority votes.

 

6.1.8.     Anything discussed and resolved in the Committee meeting including the dissenting opinions must be contained in the minutes of meeting contained in a written form signed by all attending members of Committee as the valid evidence for the resolution adopted in the meeting and submitted to the Board of Commissioners.

 

6.1.9.     Any member of Committee is given the liberty to the broadest sense of the word to express his/her professional opinion in discussing any meeting agenda without any intervention by anyone.

 

6.1.10.   Any member of the Committee is entitled to receive the copy of minutes of meeting although the relevant party does not attend such meeting.

 

6.1.11.   The attendance of the Committee members in the meeting must be reported in the quarter and annual report of the Committee.

 

6.1.12.   Total meeting and total attendance of the respective Committee members in the meeting as well as the brief report of the Committee containing the important matters discussed by the Committee must be submitted to the Board of Commissioners to be disclosed in the Annual Report.

 

6.1.13.    The Discipline of the Meeting of Committee not provided in this Guidance will be set out in a separate

regulation.

 

6.2.  Reporting

 

6.2.1.  The Committee is obliged to prepare the annual report on its tasks and responsibilities including the implementation of the Committee’s activities, and its performance achievement degree to the Board of Commissioners to be disclosed in the Company’s annual report to be submitted to the General Meeting of Shareholders.

 

6.2.2.      The Committee’s annual report as referred to in item 6.2.1 hereof must consist at least of :

 

a.    Composition of Committee including name, position and status of the parties;

 

b.    Objective and scope of work;

 

c.  Total Committee meeting in the current year and the breakdown of attendance of each member of the Committee in the meeting; and

 

6.2.3.   Conclusion, opinion or recommendation that have ever been given by the Committee to the Board of Commissioners.

 

6.2.4.    Report of the Committee signed by all members of the Committee. The Committee members not signing the same are obliged to disclose the reasons in such report.

 

 

7.      CLOSING

7.1.  This Guidance becomes effective as of its ratification by the meeting of Board of Commissioners on May 31, 2018.

 

7.2.  This Guidance will be evaluated periodically and if deemed necessary or required by the prevailing regulation, it will be amended or improved accordingly.

7.3.  Original document of this Committee Guidance is submitted to the Board of Directors for documentation in the annual report and will be contained in the Company website.