Independent directors, commissioners

Independent directors, commissioners

The idea to establish independent boards of directors and
boards of commissioners in public companies aims to uphold good
corporate governance. An independent board of directors or
commissioners may, directly or otherwise, be considered an
extension of the public.

In the case of many issuers, independence is just an empty
slogan which the controlling shareholders in a public company can
freely flaunt. Take a look at Panin Bank. Priyatna Atmadja is its
independent commissioner. Then at PT Matahari Putra Prima Tbk
(MPPA), Roy E. Tirtadji, the right hand of the Lippo Group, is
its independent commissioner.

We can perhaps learn from firms in the Eka Tjipta Widjaja's
Sinar Mas Group, i.e. PT Tjiwi Kimia Tbk P Indah Kiat Pulp and
Paper Tbk. These firms have chosen the right people as their
independent commissioners. Mas Achmad Daniri, Teddy Pawitra and
Ferdinand A. Sonneville are in no way related to Sinar Mas.

If "independent" refers to a function, than anybody can sit on
the independent board of directors or board of commissioners.
Independent directors or commissioners must act exactly as
independent parties representing the public. The question is
whether a person loyal to a group or an issuer can play his/her
role and at the same time represent public interests.

If "independent" refers to background, then the directors or
commissioners should be professionals without any relationship
with the issuers. Who will decide on the appointment of
independent directors or commissioners? The founders? The public?
It would be fairer if they are chosen by independent
shareholders.

Therefore, the Jakarta Stock Exchange, the Capital Market
Supervisory Agency or the National Committee of Good Corporate
Governance must work to review the meaning of "independent" in
this context.

-- Investor Indonesia, Jakarta