Our concept for the application of Good Corporate Governance (“GCG”) principles is based on our commitment to create a company that is transparent, accountable and trusted by managing our business responsibly. Applying GCG practices is an important step for us towards maximizing our corporate value and strengthening the principles of professionalism, transparency and efficiency in management to make it more open, accountable, trustworthy, responsible and fair, so that we can better fulfill our obligations to our shareholders, Board of Commissioners, business partners and other stakeholders. Moreover, our BoC, BoD, management and staff are committed to implementing GCG practices in the management of our business activities. This awareness of the importance of GCG stems from our desire to maintain our integrity in operating a healthy and sustainable business. Our commitment to applying these practices is not only representative of our policy of compliance with capital market rules; we also believe that it is one of the keys to the effective, efficient and sustainable performance of our business. In 2010, as one of the steps in implementing our transformation, we, through the Business Effectiveness Sub-Directorate (“BEF”), redesigned our GCG to bring it into alignment with the changes in our business. We then integrated our redesigned GCG practices into our day-to-day attitudes and behavior not only at the level of the BoC, BoD and management, but among all our employees as well, instilling the shared values that will enable us to achieve our vision, mission and objectives.
We have also invested in communicating and disseminating, training and mapping accountability and responsibilities to ensure that each employee knows and understands his or her duties, functions and responsibilities with regard to the changes in our business and our organization. TELKOM strives to be leader in corporate governance among Indonesian companies and has won several prestigious awards in relation to GCG. In addition, as public company we are subject to Bapepam-LK and SEC regulations and we implement and strive to uphold corporate governance policies and practices based on International Best Practices as well as the Indonesian Code of GCG published by the National Committee on Governance in Indonesia. As a company with a class of securities registered under Section 12 of the Exchange Act with the SEC , we comply with the provisions of the Sarbanes Oxley Act of 2002 (“SOA”) as well as other applicable rules and regulations. There are several provisions of SOA that apply to us, in particular, those under:
SOA Section 404 that require us to have adequate internal control over financial reporting (“ICOFR”) to ensure the reliability of our financial statements and that they are prepared according to the applicable accounting standards. We and our subsidiaries have committed to undergo a thorough audit of the effectiveness and integrity of the design and application of ICOFR; and
Those under SOA section 302 that require our management to be responsible for formulating, maintaining and evaluating the effectiveness of our disclosure procedures and controls to ensure that information disclosed in reports is in compliance with the Exchange Act and is recorded, processed, summarized and reported within the period provided and then accumulated and communicated to our management, including the President Director and Director of Finance, so that they can take decisions related to required disclosures. Further explanation regarding the results of management’s review of ICOFR disclosure procedures and controls and related disclosures, please see the section on “Procedures and Controls”. We also comply with Bapepam- LK and U.S. exchange and regulatory provisions regarding the independence of the members of the Audit Committee.
