Report on the Observance of Standards and Codes : Corporate Governance Country Assessment, Republic of Indonesia

In reforming its corporate governance, and in establishing a rule-based business culture, Indonesia faces many challenges. The key challenges are as follows. Enforcement of laws and regulations needs to be strengthened. Administrative sanctions for violation of securities or disclosure rules may not be adequate. Efforts should be expended to ensure that corporate officials in the position of trust are held accountable when they violate the law. Sanctions should go beyond fines, and the incentive system should be changed so that violators are truly discouraged, and good corporate behavior is promoted. This requires strengthening enforcement capacity of Bapepam for securities violations, and its independence as the securities regulator. The Company Law should explicitly refer to the fiduciary duties of directors and managers for violation of securities laws. Current efforts to amend the Company Law need to be expedited. Further efforts should also be expended to develop alternative (non-judiciary) mechanisms, such as shareholder activism, for encouraging compliance.

Bibliographic Details

Main Author:	World Bank
Language:	English en_US
Published:	Washington, DC 2004-08
Subjects:	ACCESS TO INFORMATION, ACCOUNTABILITY, ADMINISTRATIVE SANCTIONS, APPLICABLE LAWS, AUDIT COMMITTEES, AUTHORITY, AUTHORIZATION, BOARD MEMBERS, BOARD OF DIRECTORS, BOARDS OF DIRECTORS, CAPITAL MARKET, CAPITAL MARKET LAW, CAPITAL MARKETS, CASH FLOW, CENTRAL BANK, CHANGE OF OWNERSHIP, CLASSES OF SHARES, COMMON SHARES, COMPANY, COMPANY LAW, CONFLICT OF INTEREST, CONFLICTS OF INTEREST, CONGLOMERATES, CORPORATE CONTROL, CORPORATE CULTURE, CORPORATE GOVERNANCE, CORPORATION, CORPORATIONS, CRIMINAL SANCTIONS, DECISION-MAKING, DECISION-MAKING PROCESS, DECREE, DEGREE OF CONTROL, DISCLOSURE, DISCLOSURE REQUIREMENTS, DISCLOSURE RULES, DUE DILIGENCE, ECONOMIC CRISIS, ENVIRONMENTAL ISSUES, EQUITY MARKETS, EXTERNAL AUDITORS, FINANCIAL INSTITUTIONS, FINANCIAL SITUATION, FINANCIAL STATEMENTS, FIRMS, FIXED INCOME, FOREIGN CURRENCY, FOREIGN SHAREHOLDERS, GOLDEN SHARE, HUMAN RESOURCES, INSIDER TRADING, INSTITUTIONAL FRAMEWORK, INSTITUTIONAL INVESTORS, INTEREST RATES, INTERNAL AUDIT, INTERNATIONAL STANDARDS, INVESTMENT BANKERS, INVESTMENT CLIMATE, JUDICIARY, LABOR LAW, LABOR UNIONS, LAWYERS, LEGAL DISPUTES, LEGAL FRAMEWORK, LEGAL OWNER, LEGISLATION, LIMITED LIABILITY, LIMITED LIABILITY COMPANY, LISTED COMPANIES, MANAGEMENT BOARD, MERGERS, MINISTRY OF FINANCE, MINORITY SHAREHOLDER, MINORITY SHAREHOLDERS, NET PROFIT, NUMBER OF SHARES, OWNERSHIP STRUCTURE, PACIFIC REGION, PAID IN CAPITAL, PREEMPTIVE RIGHTS, PREFERENTIAL RIGHTS, PRIVATE SECTOR, PUBLIC COMPANIES, PUBLIC COMPANY, PUBLIC INFORMATION, PYRAMID STRUCTURE, REGULATORY FRAMEWORK, REPRESENTATIVES, SANCTIONS, SECURITIES FIRMS, SEVERANCE PAYMENT, SHARE OWNERSHIP, SHAREHOLDER MEETINGS, SHAREHOLDERS, SHAREHOLDING, STAKEHOLDERS, STATE-OWNED ENTERPRISES, STATEMENT, STATEMENTS, STOCK EXCHANGE, TAX AUTHORITIES, TOTAL MARKET CAPITALIZATION, TRANSPARENCY, VOTING, VOTING SHARES,
Online Access:	http://documents.worldbank.org/curated/en/2004/08/6569550/report-observance-standards-codes-rosc-corporate-governance-country-assessment-indonesia https://hdl.handle.net/10986/14463
Tags:	Add Tag No Tags, Be the first to tag this record!