Danantara to Reform State-Owned Enterprise Governance, Focusing on Asset Quality and Profitability

Jakarta: The Daya Anagata Nusantara Investment Management Agency (Danantara Indonesia), as the management and mandate holder for the portfolio of State-Owned Enterprises (BUMN), is implementing steps to strengthen governance and comprehensively restructure the firms’ fundamentals.

As part of the management transition and consolidation process, Danantara Indonesia, through its Operational Holding entity, Danantara Asset Management, is conducting thorough and structured reviews of the SOEs.

This process includes evaluating accounting policies, asset quality and recording, strengthening governance systems and integrated risk management to ensure governance standards that are increasingly solid and aligned with best practices.

This strengthening step had previously begun with the Karya Group of Companies and is now being gradually expanded to other sectors within the SOE portfolio.

The main focus of this initiative is normalisation and enhancement of asset quality, alignment of recording so that financial statements are more accurate, fair and up-to-date in accordance with applicable accounting standards and broadly recognised financial reporting practices, and ensuring transparent and prudent management practices.

Danantara Indonesia also emphasises strengthening the financial fundamentals based on earnings quality and robust operating cash flow, sustained EBITDA growth, discipline in capital expenditure, and a healthy and well-maintained capital structure.

Attention is directed to optimising return on assets (ROA), improvements in operating margins, strengthening capacity to meet financial obligations, and conservative and measured liquidity management.

This approach ensures company performance is not only reflected in nominal growth but in the ability to generate consistent cash flows, maintain solvency, improve return on equity (ROE), and strengthen the capacity to pay dividends sustainably to the state as shareholder.

Boosting earnings quality

Managing Director of Stakeholder Management at Danantara Indonesia, Rohan Hafas, said that this governance reset is part of the new management’s commitment to ensuring that SOE management is oriented towards real economic value and long-term sustainability.

‘As the new management and the mandate holder for state asset management, Danantara Indonesia is obliged to conduct a comprehensive review of asset quality, accounting policies and governance discipline across the entire portfolio,’ said Rohan in a formal statement on Thursday, 5 March 2026.

‘This governance reset is a step to strengthen the foundation so that the balance sheet reflects current, prudent and credible conditions,’ he asserted.

Rohan also stressed that future success will not be measured solely by the size of balance-sheet figures, but by the quality of earnings, the strength of cash flows, and the company’s ability to create real economic value,’ he said.

‘Our focus is to build a foundation that generates real money and sustainable dividends for the country. Healthy growth must be based on productivity and operational performance, so that its contribution to state revenue is truly measurable and sustainable,’ he asserted.

‘According to Rohan, with an ever-stronger financial foundation and disciplined management, the company will focus more on efficiency, improving operating margins, and creating real value for the shareholder, namely the state.’

‘Danantara Indonesia emphasises that the process is being conducted systematically and gradually, while maintaining operational stability and business continuity across the portfolio, as part of a long-term institutional transformation to strengthen the national economic foundation.’