NOMINATION AND REMUNERATION COMMITTEE (NRC)

Nomination and Remuneration Committee assists the Board of Commissioners to evaluate remuneration policy, and overall human resources management as well as providing advice and constructive feedback on nomination systems and procedures and/or replacement of members of the Board of Directors and the Board of Commissioners as well as an independent members of the Board of Commissioners.

Membership Of The Nomination And Remuneration
The structure and composition has complied with Regulation No. 8/4/PBI/2006 as amended by Regulation No. 8/14/PBI/2006.

The BRI Nomination and Remuneration Committee is chaired by Chairman of BoC who is also an Independent Commissioner and members consisting of all members of the Board of Commissioners plus one executive officer, i.e Head of Human Resources Management Division. They are as follows:

No.NamePeriod of TenurePositionProfession
1.Mustafa Abubakar2015-nowChairmanPresident Commissioner/Independent Commissioner
2.Gatot Trihargo2015-nowMemberVice President Commissioner
3.Adhyaksa Dault2015-nowMemberIndependent Commissioner
4.Ahmad Fuad2015-nowMemberIndependent Commissioner
5.A. Fuad Rahmany2015-nowMemberIndependent Commissioner
6.A. Sonny Keraf2015-nowMemberIndependent Commissioner
7.Vincentius Sonny Loho2015-nowMemberCommissioner
8.Jeffry J. Wurangian2015-nowMemberCommissioner
9.Eko Bambang Suharno
(Head of Division of HR Policies and Development)
2015-nowMemberEx-officio
PROFILE OF COMMITTEE MEMBER
Chairman of Committee
Mustafa Abubakar
Chairman of Nomination and Remuneration Committee/Independent Commissioner
Profile can be found in the section of Member of BoC Profile
Members of Committee
Gatot Trihargo
Member NRC/Vice President Commissioner
Profile can be found in the section of Member of BoC Profile
Adhyaksa Dault
Member NRC/Independent Commissioner
Profile can be found in the section of Member of BoC Profile
Ahmad Fuad
Member NRC/Independent Commissioner
Profile can be found in the section of Member of BoC Profile
A. Fuad Rahmany
Member NRC/Independent Commissioner
Profile can be found in the section of Member of BoC Profile
A. Sonny Keraf
Member NRC/Independent Commissioner
Profile can be found in the section of Member of BoC Profile
Vincentius Sonny Loho
Member NRC/Commissioner
Profile can be found in the section of Member of BoC Profile
Jeffry J. Wurangian
Member NRC/Commissioner
Profile can be found in the section of Member of BoC Profile
Eko Bambang Suharno
Member of Nomination and Remuneration Committee
Born in Wonosobo in 1960. Graduated with a Bachelor’s Degree from the Faculty of Fishery Majoring in Social Economics, Bogor Agricultural Institute (IPB) in 1983. A MBA Degree was obtained from Virginia Commonwealth University in 1992. He started his career in PT Bank Rakyat Indonesia (Persero) Tbk. in 1985 and served in several important position, such as: Head of Bank BRI Branch Office Muara Bungo (1995-1998), Head of Bank BRI Branch Office Probolinggo (1998-2001), Head of Bank BRI Branch Office Bekasi (2001-2002), Deputy Head of MSDM Division (2002-2005), Head of Sharia Unit (UUS) of Bank BRI (2005-2009) and participating in the establishment of PT Bank BRISyariah and served as Director of PT Bank BRISyariah from 13 November 2008 until 8 April 2015. Then he served as Head of Service Division of BRI (April 2015 - August 2015) and as Head of HR Policy & Development Division (August 2015 - now), in addition to serving as Commissioner of BRI Syariah.

INDEPENDENCY OF THE COMMITTEE MEMBERS

  • Independent members of the NRC have no affiliation with the Directors, other Commissioners or the controlling shareholder of BRI
  • All members of the NRC is are not shareholders, commissioners, directors and employees of companies that have affiliation or business with BRI.

DUTIES AND RESPONSIBILITIES

Nomination Function

  1. To analyze, formulate and make recommendations to the Board of Commissioners on nomination and/or replacement systems and procedures of members of the Board of Commissioners and Board of Directors.
  2. To provide recommendations to the BoC on prospective candidates of the Board of Commissioners and/or Board of Directors.
  3. To monitor application of and analyse the criteria and selection procedure for candidates who directly report to the Board of Directors.
  4. To develop performance appraisal of Board of Commissioners and Board of Directors.
  5. To provide recommendations on the number of members of the Board of Commissioners and Board of Directors.
  6. To give opinions or advice on BoD’s decision to transfer and/or appoint a non-career employee as senior executive one level under the Board of Directors.
  7. To analyse direct reports on senior officers’ data submitted to the Board of Directors on a quarterly basis or at any time if there is a change.
  8. To provide recommendations to the Board of Commissioners on an Independent Party who will become a member of the Audit Committee or member of the Risk Management Monitoring Committee.

Remuneration Function

  1. To evaluate the remuneration policy applicable to the Boards of Commissioners and Directors and employees.
  2. To provide recommendations to the Board of Commissioners on:
    • Remuneration policy for the Board of Commissioners and Board of Directors.
    • Remuneration policy for executive officers and employees of the Company as a whole to be submitted to the Board of Directors.
  3. To provide recommendations option plans for Commissioners, Directors and employees, including stock options.
  4. To provide recommendations on pension system for the Company’s employees.
  5. To provide recommendations on compensation and other benefits in case of Company lay-offs.

Others

  1. To evaluate and provide recommendations to the BoC related to employment/labor policy and other functions in human resources management which may have significant financial impacts and/or legal risks to the Company.
  2. To make recommendations on internal/external audit findings, and results of supervision of Bank Indonesia, specifically on policies of human resource management.
  3. To administer documents related to the duties and responsibilities of the Committee.

DESCRIPTION IMPLEMENTATION OF COMMITTEE ACTIVITIES IN 2016

Some of the NRC work program in 2016 included:

  1. Preparing Recommendation on Nomination of Directors given to Board Of Commissioners
    Before March 2016, the NRC had proposed the nomination of directors to the Board of Commissioners, which is preceded by the nomination process in January to February.
  2. Reviewing Structure and Amount of Remuneration of Directors and Commissioners
    In the first week of March 2016, NRC submitted a review and proposal of the remuneration of Directors and Commissioners to the Board of Commissioners to be proposed at the General Meeting of Shareholders in 2016.
  3. Review of Employee Remuneration Implementation and Employment/Labor Policy
    Review was conducted by evaluating implementation of HR architecture, human resource policies, and reports as well as presentation from Directors and/or the Human Resources Division. The review process was carried out on employment policy evaluation meeting held at the end of June 2016 and mid-November 2016 as well as on evaluation meeting of employee’s remuneration and Employment Policies at the end of November 2016.

Based on those review processes, the NRC submitted recommendations regarding the implementation of Employee’s Remuneration and Employment Policies to the Board of Commissioners. The recommendations would become input for the Board of Commissioners in order to offer opinions and advice to the Board of Directors to ensure BRI has set the remuneration and employment policies in a fair manner, can motivate all employees, and is in accordance with the financial capacity and performance of the Company.

Recommendations of NRC
The NRC and other committees (KA and RMOC) under the coordination of the Secretary to the Board of Commissioners provide recommendations in the form of opinions and suggestions related to Board of Directors measures that require the approval of the Board of Commissioners, such as:

  1. Appointment of BRI Subsidiaries’ Directors and Commissioners
  2. A management contract for a period longer than 3 (three) years;
  3. Deciding organizational structure of direct reporting to the Board of Directors; and
  4. Deciding the appointment of the Head of Internal Audit and Head of Corporate Secretariat Division.
Documentation of NRC’s Policy Reviews
NoNumber of LetterSubject
1R. 01-KNR/01/2016, dated 20 January 2016Proposal for NRC - MSOP Meeting
2R. 02-KNR/02/2016, dated. 05 February 2016Adjustment of Honorarium for Member who is not Commissioner
3R. 03-KNR/02/2016, dated. 12 February 2016NRC recommendation on proposal of remuneration for member of BoD and BoC
4R. 04-KNR/03/2016, dated. 22 March 2016NRC recommendation on Determination of Candidates for Member of BoD and/or BoC to be proposed at the GMS 23 March 2016
5R. 05-KNR/06/2016, dated. 01 June 2016Proposal for reappointment of the Secretary of BoC
6R. 06-KNR/06/2016, dated. 01 June 2016Recommendation for Applying as Independent Commissioner

OPINION OF THE NOMINATION AND REMUNERATION COMMITTEE ON THE COMPANY’S NOMINATION AND REMUNERATION
The Remuneration and Nomination Committee considered the nomination and/or replacement systems and procedures of members of the Board of Commissioners and/or Board of Directors as referring to prevailing regulations and good corporate governance principles. For example, in nominating candidates for the Board of Directors, each candidate must pass assessment conducted by independent parties and Directors should at least prepare two (2) candidates who subsequently will undergo fit and proper test by the Board of Commissioners with direct interviews.

The Nomination and Remuneration Committee concluded that performance measurement for the Board of Commissioners and Board of Directors which are currently conducted collegially/collectively was deemed sufficient. However, the Company needed to develop a system of individual performance appraisal, particularly for the Board of Directors. Individual appraisal can measure the effectiveness of each Director’s duties without ruling out that there is collective/ collegial performance that affects individual Directors’ performance (when the duties of a Director are affected by the others’ duties and responsibilities).

In terms of criteria and selection procedure for prospective senior officers/direct reports to the Board of Directors, the Nomination and Remuneration Committee assessed that the Directors have implemented the system with prudent, transparent and accountable criteria and procedures.

Related to remuneration, the Company was deemed to apply remuneration of the Directors based on their performance, benchmarks and peers to industry group. Remuneration was also based on a comprehensive evaluation that was assisted by a competent independent parties.

Similarly, remuneration for employees as a whole was exercised in a fair manner in order to motivate employees, with due regard to the Company’s financial capabilities and remuneration in the industry.

Meeting Agenda and Attendance of NRC
NoMeeting AgendaDateNo NRC Minutes of MeetingAttendanceDescription
1a. Progress on LTI Review
b. Nomination and Remuneration - Preparation for GMS 2016
26 January 2016B.01-KNR/01/20167Quorum
2Evaluation on remuneration for BoD and BoC in 2016 and Evaluation of Performance of BRI BoD9 February 2016B.02-KNR/02/20166Quorum
3Proposal for candidate of member of BoD of BRI3 March 2016B.03-KNR/03/20166Quorum
4Evaluation on the candidates for BoD and BoC to be proposed to GMS 201622 March 2016B.04-KNR/03/20167Quorum
5Change of position from Commissioner to Independent Commissioner of BRI31 May 2016B.05-KNR/05/20168Quorum
6Evaluation on proposal of salary/honorarium of BoD and BoC in 201627 June 2016B.06-KNR/06/20168Quorum
7Determination of salary/honorarium and tantiem BoD and BoC in 201628 June 2016B.07-KNR/06/20166Quorum
8Evaluation on HR Policies11 October 2016B.08-KNR/10/20167Quorum
No.NamePositionNumber of NRC MeetingAttendance of NRC% Attendance of NRC
1Mustafa AbubakarChairman8788%
2Gatot TrihargoMember8563%
3Adhyaksa DaultMember8788%
4Ahmad FuadMember8788%
5A. Fuad RahmanyMember8788%
6A. Sonny KerafMember8788%
7Vincentius Sonny LohoMember8563%
8Jeffry J. WurangianMember8788%
9Eko Bambang SuharnoMember8563%

EDUCATION/TRAINING IN FISCAL YEAR
Training attended by NRC members during 2016 are listed on the list of the education/training courses of the Board of Commissioners during 2016.

REMUNERATION OF COMMITTEE MEMBERS
Remuneration for NRC members from the Board of Commissioners is reported in the honorarium paid to the Board of Commissioners and there are no special honorarium for each member of the Committee. Particularly for Committee members as independent party (not commissioner), the amount of honorarium was determined by the Board of Commissioners with a maximum amount of 20% of President Director’s salary and no other remuneration other than the honorarium. This is in accordance with Ministry of SOEs Regulation No. PER-12.MBU BUMN/2012 dated August 24, 2012 on Supporting Organs of a BoC.

COMMITTEE GUIDELINES
Guidelines for the Nomination and Remuneration Committee were approved by the Board of Commissioners on May 12th 2015 and there were no changes until 2016. The guidelines regulate the purpose of the Committee establishment, membership, authority, duties and responsibilities, position, work ethics and meetings. It is also a guideline on the Committee’s duties and responsibilities in order to support the effectiveness of the tasks and responsibilities of the BoC in the field of human resource management.

SUCCESSION POLICY OF BOARD OF DIRECTORS

Nomination and Remuneration Committee
The Nomination and Remuneration Committee will solicit candidates for the Board of Directors based on the preestablished qualifications. This netting process involves external agencies, Assessment Center Indonesia (ACI) and the Assessment Center Telkom (ACT). After screening process, the NRC proposes candidates to the Board of Commissioners.

Board Of Commissioners
Through the mechanism of internal meetings, the Board of Commissioners proposed a list of candidates for the Board of Directors to the Shareholders of Series A Dwiwarna.

Shareholders of Series A Dwiwarna
Ministry of SOEs as representatives of Shareholders Series A Dwiwarna must evaluate candidates for Directors through fit and proper tests. Upon passing the tests, the Ministry of SOEs will approve succession of candidates for the Board of Directors and at the same time, will arrange a new organization structure to be decided by the General Meeting of Shareholders.

GMS
The GMS decides the structure and changes of members of Board of Directors of BRI. In the case where members of the Board of Directors who have been appointed but not yet been approved by the OJK, then the appointment is not deemed effective. Prospective members of the Board of Directors of BRI are prohibited from doing duties as members of the Board of Directors or be involved in Bank operations or other activities that have a significant influence on the policies and financial condition of the Bank, although they have been appointed by the GMS.

Corporate Secretary Division
Corporate Secretary Division files requests to OJK to conduct Fit and Proper Test.

OJK
OJK conducts fit and proper assessments on the appointed Directors. The test includes administrative examination and interview. Approval or rejection of the application in question will be given by the OJK no later than 30 (thirty) days after receipt of the complete application.