Commissioners' performance

Commissioners' performance

The last couple of months have seen at least three new
president commissioners of state-owned companies appointed
following the replacement of their new respective board of
directors.

One was Martiono Hadianto, president commissioner of state oil
company PT Pertamina, who was elected in February. The other two
were Edwin Gerungan of Bank Mandiri and Rudjito of BRI on May 16
and May 17 respectively.

Both the people and the government's expectation as regards
their appointment as president commissioners, together with the
commissioners who help them, is that the companies they oversee
will grow healthily and profitably. In fact, most state-owned
companies have for decades experienced the opposite and suffered
losses. To mention just a few, state-owned railway and
electricity companies, Garuda and Merpati flight carriers, and
state-run Jakarta bus firm PPD.

At the very least, president commissioners and commissioners
are partly responsible for the healthy and profitable growth of
companies they oversee. Their salaries are half the amount of
their president directors'. So do commissioners receive half the
amount of directors' salaries. As such, all president
commissioners as well as their commissioners should also be held
responsible when their companies grapple with problems, as it
shows that their oversight function did not work.

The present Bank Mandiri case in which its president director
and his two directors have been named suspects and detained,
could be an example. The smiling picture of the former president
commissioner of the bank, Binhadi, and the fatigued face of the
then president director ECW Neloe during a farewell press
conference following the general shareholders meeting on May 16
(The Jakarta Post, May 17) shows contrasting views.

On one hand, the former president director looked battered by
his huge problems, while on the other hand, the former president
commissioner looked as if he had nothing to lose.

Even though the latter received only half the salary of the
former, all the problems that had become hot news should have
been the problems of all board commissioners and directors
depending on their respective roles.

In order to improve t boards of commissioners' performance,
the state-owned-enterprises ministry should increase its
oversight function despite the existence of each company's
internal supervisory system. In this way, a company's healthy and
profitable growth would be ensured, and law enforcement agencies
could not touch them.

M. RUSDI, Jakarta