Implementation of Corporate Governance

Banner Implement of CG

Implementation of GCG Practice in Public Company

Implementation of GCG Practice in Public Company as reference the Guideline of Corporate Governance issued by the Financial Services Authority (Comply / Explain)

Implementation of GCG Practice in Public Company

A. Aspect 1: Relationship between Public Company and Shareholders in Ensuring the Rights of Shareholders

No.	Aspect; Principle; Recommendation	Comply or Explain
A.1. Principle 1: Increase the Value of the General Meeting of Shareholders (GMS).
A.1.1.	Recommendation 1 : The Public Company has technical means or procedure for both open and closed voting that prioritize independency and interest of Shareholders. Explanation : Every issued share with voting right has one vote (one share one vote). The Shareholders may use their voting rights during the decision-making process, in particular to decision with voting mechanism. However, both open and closed voting mechanism has not been regulated in details. The Public Company is recommended to have voting procedure in decision making of GMS agenda. Such voting procedure must maintain independency or freedom of Shareholders. As an example, an open voting mechanism is implemented by raising hand in accordance with option as offered by the GMS chairman. Whilst a close voting mechanism is conducted in any decision that required confidentiality or by request from Shareholders through voting card or electronic voting.	The Annual General Meeting of Shareholders (GMS) and Extraordinary GMS, Bank Mandiri has exercised open and close voting which is stated in the GMS Mechanisms. The voting mechanism at the GMS is regulated in the Bank’s Articles of Association. In the 2021 Fiscal Year Annual GMS, the open voting mechanism, and specifically for the agenda of changes of the management was done with close mechanism which was carried out by the Bank’s officers and collects the voting rights by approaching all present shareholders, in which voting are stored in the voting box. The Bank has developed the GMS Procedures that can be downloaded in the Company’s website and were distributed to the Shareholders during the GMS. Description : Comply
A.1.2.	Recommendation 2 : All members of the Board of Directors and the Board of Commissioners of Public Company attends the Annual GMS. Explanation : The presence of all members of the Board of Directors and the Board of Commissioners of the Public Company is intended so that each member of the Board of Directors and the Board of Commissioners can pay attention to, explain, and answer directly the issues or questions as raised by shareholders related the GMS agenda.	The Annual GMS Fiscal Year 2021 was attended by all members of the Board of Commissioners and Board of Directors Description: Comply
A.1.3.	Recommendation 3 : The Summary of Minutes of GMS is available in the Public Company’s website at least for one (1) year. Explaination : Based on Article 34 paragraph (2) of the OJK Regulation No.32/POJK.04/2014 on the Plan and Implementation of the General Meeting of Shareholders of Public Company, The Public Company is required to make summary of GMS Minutes in Indonesian and foreign language (minimum in English), and announced to the public within two (2) working days after the GMS is held, one of which is through the Public Company Website. The availability of summary of GMS Minutes in the Public Company Website provides an opportunity for shareholders who are not present, to easily obtain important information in GMS implementation. Therefore, the provision on the minimum period of availability of GMS Minutes summary in the Website are intended to provide sufficient time for shareholders to obtain such information.	The Annual GMS minutes of meeting of 2021, in both Indonesian and English language, was announced at the latest 2 (two) working days following the GMS, which published on the Bank’s website, IDX Electronic Reporting System, OJK and eASY KSEI. The Bank’s website presented the GMS convention, including GMS minutes for the last 5 (five) years. In addition, the Bank has also provided the GMS Highlights in both Indonesian and English languages that was uploaded in the website in 1 (one) working day after the GMS convention. Description : Comply
A.2. Principle 2 : Enhancing the Quality of Communication between Public Company with Shareholders or Investors.
A.2.1.	Recommendation 4: Public Company has communication policy with the Shareholders and Investors. Explanation : The communication between Public Company and shareholders or investors is intended so that shareholders or investors obtain clarity of information that has been published to the public, such as periodic reports, information disclosure, business condition or prospect and performance, as well as implementation of public company governance. In addition, the shareholders or investors can also submit input and opinion to the management of Public Company.	The Bank has a communication policy with shareholders or investors, as stipulated in the Corporate Secretary Charter, Chapter III.A.I. Disclosures. The disclosure to the stakeholders is formulated by referring to the Capital Market regulations and other relevant laws and regulations, which can be summarized as follows : Periodic and or incidental reporting to regulators (OJK, Bank Indonesia, LPS, Ministry of Justice and Human Rights, Indonesia Stock Exchange) and reporting through Electronic Reporting System. General Meeting of Shareholders (GMS) Implemented according to laws and the Bank’s Articles of Association consisted of the Annual GMS and Extraordinary GMS. Organizing other activities related to corporate actions and/or information disclosure such as : Performance Presentation (quarterly) Public Expose (quarterly) Analyst Meeting (quarterly) The Performance Presentation, Public Expose dan Analyst Meeting exercised quarterly and annually were aimed at disclosing information to public and investors on the Bank’s conditions, business prospects, performances, as well as its corporate governance implementation. The Bank also has established specific unit that is tasked to maintain and manage good relations with investors, as well as serve as a centre of information on the Bank’s performance to the investors. Description: Comply
A.2.2.	Recommendation 5 : The Public Company discloses the Communication Policy of Public Company with shareholders or investors in Website. Explaination : Disclosure of communication policy is a form of transparency on the commitment of the Public Company in providing equality to all shareholders or investors for the implementation of communication. The disclosure of information also aims to increase the participation and role of shareholders or investors in the implementation of the Public Company communication program.	The Bank has in place the communication policy on Public Company with shareholders or investors as stated in the Corporate Secretary Charter, Chapter III.A.I Disclosures. The policy is provided in the Website. The Bank also continually manages the information in the website, hence latest information is ready for the shareholders and investors, such as Products/Services, Performance, Management, and Activities. Description: Comply

B. Aspect 2: Functions and Roles of the Board of Commissioners

No.	Aspect; Principle; Recommendation	Comply or Explain
B.1. Principle 3: Strengthen the Membership Composition of the Board of Commissioners.
B.1.1.	Recommendation 6 : Determination of total members of the Board of Commissioners takes into account the conditions of the Public Company. Explanation : The total members of the Board of Commissioners may affect the effectiveness of the duties of the Board of Commissioners. Determination of total members of the Board of Commissioners of a Public Company must refer to the provisions of the prevailing law in which at least consists of two (2) people based on the provisions of the Financial Services Authority Regulation No. 33/POJK.04/2014 on The Board of Directors and Commissioners of Issuers or Public Companies. In addition, it is also necessary to consider the condition of the Public Company, which includes among other, the characteristic, capacity and size, as well as achievement of target and fulfillment of different business needs among the Public Companies. However, exorbitant Board of Commissioners has the potential to disrupt the effectiveness on the implementation function of the Board of Commissioners.	Bank Mandiri has complied with the Articles 20 POJK No.33/POJK.04/2014 concerning the Board of Directors and Board of Commissioners of Issuers and Public Companies, namely number of members of the Board of Commissioners is more than 2 (two) members. Total members of the Bank’s Board of Commissioners as of 31 December 2021 are 10 (ten) members, which consisted of 5 (five) Independent Commissioners, and 5 (five) Commissioners of non-Independent. Description : Comply
B.1.2.	Recommendation 7 : Determination on the composition of members of the Board of Commissioners takes into account on diversity of expertise, knowledge and required experience. Explanation : The composition of the Board of Commissioners is a combination of characteristics from both organ and individual perspective according to the need of respective Public Company. These characteristics can be reflected in the determination of expertise, knowledge and experience required in the implementation of supervisory and advisory duty by the Board of Commissioners of the Public Company. The composition that has taken into account the need of the Public Company is a positive, especially related to decision making related with supervisory function as carried out by considering various broader aspects.	The composition of members of the Board of Commissioners takes into account the diversity of expertise, knowledge and experience needed as disclosed in the Section of Composition and Assignment of the Bank’s Board of Commissioners. Description: Comply
B.2. Principle 4: Enhancing the Quality of Implementation of Duties and Responsibilities of the Board of Commissioners
B.2.1	Recommendation 8 : The Board of Commissioners has a self-assessment policy to assess the performance of the Board of Commissioners. Explaination : The Board of Commissioners’ Self-Assessment policy is a guideline that is used as a form of collegial accountability for evaluating the performance of the Board of Commissioners. Self-assessment is carried out by each member to assess the collegial performance of the Board of Commissioners, and not to assess the individual performance of each member of the Board of Commissioners. With this Self-Assessment, it is expected that each member of the Board of Commissioners can contribute in improving the performance of the Board of Commissioners on an ongoing basis. This policy can include the assessment activity as carried out along with the purpose and objective, periodic period of implementation, and benchmark or assessment criteria being used in accordance with the recommendations from the Remuneration and Nomination function of Public Company as required by OJK Regulation on the Remuneration and Nomination Committee of Issuer or Public Company.	The Board of Commissioners has in place the self-assessment policy that regulated in the BOC Charter. The Performance Assessment of the Board of Commissioners is carried out by each member of the Board of Commissioners through self-assessment mechanism based on assessment criteria of duties implementation and responsibilities of the Board of Commissioners covering the aspects of structure, directives and oversight. Description: Comply
B.2.2.	Recommendation 9: The Self-Assessment Policy to evaluate the performance of the Board of Commissioners is disclosed in the Annual Report of Public Company. Explaination : The disclosure of Self-Assessment Policy on performance of the Board of Commissioners is conducted not only to comply with transparency aspect as form of accountability of its duties but also to provide assurance to the Shareholders or investors on efforts that need to be done in improving the performance of the Board of Commissioners. Upon the availability of disclosure, the Shareholders or investors acknowledge the check and balance mechanism towards the Board of Commissioners.	The self-assessment policy on the Board of Commissioners’ performance assessment has been disclosed in this Annual Report. Description: Comply
B.2.3.	Recommendation 10 : The Board of Commissioners has policy on resignation of member of the Board of Commissioner when involved in financial crime. Explaination: The resignation policy of a member of the Board of Commissioners who is involved in a financial crime is a policy that can increase the trust of stakeholders in the Public Company, so that the integrity of the company will be maintained. This policy is needed to assist the smooth running of the legal process and so that the legal process does not interfere with business activities. In addition, in terms of morality, this policy builds an ethical culture within the Public Company. This policy can be included in the Guidelines or Code of Ethics that apply to the Board of Commissioners. Furthermore, what is meant by being involved in a financial crime is the status of being convicted of a member of the Board of Commissioners from an authorized party. Financial crimes referred to include manipulation and various forms of embezzlement in financial service activities as well as the Criminal Act of Money Laundering as referred to in Law Number 8 of 2010 concerning Prevention and Eradication of Money Laundering.	Bank Mandiri has in place the policy on resignation of member of the Board of Commissioners when involved in financial crime as stated in the Bank’s Articles of Association, namely the tenure of the Board of Commissioners is ended upon the violations of laws and regulations and upon resignation. Referring to the Article 14 paragraph (26) letter f of the Bank’s Articles of Association, the tenure of member of the Board of Commissioners is ended if no longer meet the requirements as member of the Board of Commissioners based on the Articles of Association and other laws and regulations. In the event that a member of the Board of Commissioners is resigning including if involved in the financial crime, thus a concerned member of the Board of Commissioners shall inform in writing regarding his/her intention to the Bank, and the Bank shall convene the GMS to take decision on the resignation of a member of the Board of Commissioners within 90 days after the acceptance of the resignation. Description: Comply
B.2.4.	Recommendation 11 : The Board of Commissioners or Committee that perform the Remuneration and Nomination Function formulates the succession policy in the nomination process of member of the Board of Directors. Explaination : Based on the provision of the OJK Regulation No.34/POJK.04/2014 on the Remuneration and Nomination Committee of Issuer or Public Company, the committee that carries out the nomination function has the task of formulating policy and criteria needed in the nomination process of potential member of the Board of Directors. Policy that can support the nomination process is the succession policy of member of the Board of Directors. The policy on succession aims to maintain the continuity of the regeneration of leadership in the company in order to maintain the business continuity and the company’s long-term objective.	Bank Mandiri has established the Remuneration and Nomination Committee that assists the Board of Commissioners to propose recommendations to the shareholders of series A Dwiwarna, in terms of the following : Develop, implement and analyze the nomination criteria and procedures for candidates for the Board of Commissioners and Directors. Identifying candidates for the Board of Directors, both from within and from outside, and candidates for the Board of Commissioners who meet the requirements to be proposed/appointed as Director or Board of Commissioners. In terms of preparation for future leadership regeneration, the Bank designed a Talent and Succession Management program, a succession policy for the Board of Directors that refer to the SOE Minister Regulation No. PER-11/MBU/2021 on the requirement, appointment and dismissal procedures of the Board of Directors of SOEs. In addition, as a Public Company, the Bank’s policy also refers to POJK No.33/POJK.04/2014 on the Board of Directors and the Board of Commissioners of Issuers or Public Companies. The Appointment and Dismissal of the Bank’s Board of Directors are carried out based on the professionalism and GCG principles. Description: Comply

No.

Aspect; Principle; Recommendation

Comply or Explain

B.1. Principle 3: Strengthen the Membership Composition of the Board of Commissioners.

B.1.1.

Recommendation 6 : Determination of total members of the Board of
Commissioners takes into account the conditions
of the Public Company.

Explanation : The total members of the Board of Commissioners may affect the effectiveness of the duties of the Board of Commissioners. Determination of total members of the Board of Commissioners of a Public Company must refer to the provisions of the prevailing law in which at least consists of two (2) people based on the provisions of the Financial Services Authority Regulation No. 33/POJK.04/2014 on The Board of Directors and Commissioners of Issuers or Public Companies. In addition, it is also necessary to consider the condition of the Public Company, which includes among other, the characteristic, capacity and size, as well as achievement of target and fulfillment of different business needs among the Public Companies. However, exorbitant Board of Commissioners has the potential to disrupt the effectiveness on the implementation function of the Board of Commissioners.

Bank Mandiri has complied with the Articles 20 POJK No.33/POJK.04/2014 concerning the Board of Directors and Board of Commissioners of Issuers and Public Companies, namely number of members of the Board of Commissioners is more than 2 (two) members. Total members of the Bank’s Board of Commissioners as of 31 December 2021 are 10 (ten) members, which consisted of 5 (five) Independent Commissioners, and 5 (five) Commissioners of non-Independent.

Description : Comply

B.1.2.

Recommendation 7 : Determination on the composition of members of the Board of Commissioners takes into account on diversity of expertise, knowledge and required experience.

Explanation : The composition of the Board of Commissioners is a combination of characteristics from both organ and individual perspective according to the need of respective Public Company. These characteristics can be reflected in the determination of expertise, knowledge and experience required in the implementation of supervisory and advisory duty by the Board of Commissioners of the Public Company. The composition that has taken into account the need of the Public Company is a positive, especially related to decision making related with supervisory function as carried out by considering various broader aspects.

The composition of members of the Board of Commissioners takes into account the diversity of expertise, knowledge and experience needed as disclosed in the Section of Composition and Assignment of the Bank’s Board of Commissioners.

Description: Comply

B.2. Principle 4: Enhancing the Quality of Implementation of Duties and Responsibilities of the Board of Commissioners

B.2.1 Recommendation 8 : The Board of Commissioners has a self-assessment policy to assess the performance of the Board of Commissioners.

Explaination : The Board of Commissioners’ Self-Assessment policy is a guideline that is used as a form of collegial accountability for evaluating the performance of the Board of Commissioners. Self-assessment is carried out by each member to assess the collegial performance of the Board of Commissioners, and not to assess the individual performance of each member of the Board of Commissioners. With this Self-Assessment, it is expected that each member of the Board of Commissioners can contribute in improving the performance of the Board of Commissioners on an ongoing basis.

This policy can include the assessment activity as carried out along with the purpose and objective, periodic period of implementation, and benchmark or assessment criteria being used in accordance with the recommendations from the Remuneration and Nomination function of Public Company as required by OJK Regulation on the Remuneration and Nomination Committee of Issuer or Public Company.

The Board of Commissioners has in place the self-assessment policy that regulated in the BOC Charter. The Performance Assessment of the Board of Commissioners is carried out by each member of the Board of Commissioners through self-assessment mechanism based on assessment criteria of duties implementation and responsibilities of the Board of Commissioners covering the aspects of structure, directives and oversight.

Description: Comply

B.2.2.

Recommendation 9: The Self-Assessment Policy to evaluate the performance of the Board of Commissioners is disclosed in the Annual Report of Public Company.

Explaination : The disclosure of Self-Assessment Policy on performance of the Board of Commissioners is conducted not only to comply with transparency aspect as form of accountability of its duties but also to provide assurance to the Shareholders or investors on efforts that need to be done in improving the performance of the Board of Commissioners. Upon the availability of disclosure, the Shareholders or investors acknowledge the check and balance mechanism towards the Board of Commissioners.

The self-assessment policy on the Board of Commissioners’ performance assessment has been disclosed in this Annual Report.

Description: Comply

B.2.3.

Recommendation 10 : The Board of Commissioners has policy on resignation of member of the Board of Commissioner when involved in financial crime.

Explaination: The resignation policy of a member of the Board of Commissioners who is involved in a financial crime is a policy that can increase the trust of stakeholders in the Public Company, so that the integrity of the company will be maintained. This policy is needed to assist the smooth running of the legal process and so that the legal process does not interfere with business activities. In addition, in terms of morality, this policy builds an ethical culture within the Public Company. This policy can be included in the Guidelines or Code of Ethics that apply to the Board of Commissioners.

Furthermore, what is meant by being involved in a financial crime is the status of being convicted of a member of the Board of Commissioners from an authorized party. Financial crimes referred to include manipulation and various forms of embezzlement in financial service activities as well as the Criminal Act of Money Laundering as referred to in Law Number 8 of 2010 concerning Prevention and Eradication of Money Laundering.

Bank Mandiri has in place the policy on resignation of member of the Board of Commissioners when involved in financial crime as stated in the Bank’s Articles of Association, namely the tenure of the Board of Commissioners is ended upon the violations of laws and regulations and upon resignation.

Referring to the Article 14 paragraph (26) letter f of the Bank’s Articles of Association, the tenure of member of the Board of Commissioners is ended if no longer meet the requirements as member of the Board of Commissioners based on the Articles of Association and other laws and regulations. In the event that a member of the Board of Commissioners is resigning including if involved in the financial crime, thus a concerned member of the Board of Commissioners shall inform in writing regarding his/her intention to the Bank, and the Bank shall convene the GMS to take decision on the resignation of a member of the Board of Commissioners within 90 days after the acceptance of the resignation.

Description: Comply

B.2.4.

Recommendation 11 : The Board of Commissioners or Committee that perform the Remuneration and Nomination Function formulates the succession policy in the nomination process of member of the Board of Directors.

Explaination : Based on the provision of the OJK Regulation No.34/POJK.04/2014 on the Remuneration and Nomination Committee of Issuer or Public Company, the committee that carries out the nomination function has the task of formulating policy and criteria needed in the nomination process of potential member of the Board of Directors. Policy that can support the nomination process is the succession policy of member of the Board of Directors. The policy on succession aims to maintain the continuity of the regeneration of leadership in the company in order to maintain the business continuity and the company’s long-term objective.

Bank Mandiri has established the Remuneration and Nomination Committee that assists the Board of Commissioners to propose recommendations to the shareholders of series A Dwiwarna, in terms of the following :

Develop, implement and analyze the nomination criteria and procedures for candidates for the Board of Commissioners and Directors.
Identifying candidates for the Board of Directors, both from within and from outside, and candidates for the Board of Commissioners who meet the requirements
to be proposed/appointed as Director or Board of Commissioners.

In terms of preparation for future leadership regeneration, the Bank designed a Talent and Succession Management program, a succession policy for the Board of Directors that refer to the SOE Minister Regulation No. PER-11/MBU/2021 on the requirement, appointment and dismissal procedures of the Board of Directors of SOEs. In addition, as a Public Company, the Bank’s policy also refers to POJK No.33/POJK.04/2014 on the Board of Directors and the Board of Commissioners of Issuers or Public Companies. The Appointment and Dismissal of the Bank’s Board of Directors are carried out based on the professionalism and GCG principles.

Description: Comply

C. Aspect 3: Functions and Roles of the Board of Directors

No.	Aspect; Principle; Recommendation	Comply or Explain
C.1. Principle 5: Strengthen the Membership Composition of the Board of Directors.
C.1.1.	Recommendation 12 : Determination of total members of the Board of Directors takes into account on the condition of the Public Company and effectiveness in decision making. Explanation : Being the Company’s organ that authorized in managing the Company, the determination of total members of the Board of Directors has significant impact to the Company’s performance. Thus, the determination of the total members of the Board of Directors must be done through careful consideration and refer to the provisions of the applicable regulation, whereby based on OJK Regulation No.33/POJK.04/2 14 on the Board of Directors and Board of Commissioners of Public Company, shall at least consists of 2 (two) people. In addition, the determination of total members of the Board of Directors must be based on the need to achieve the objectives and purpose of public company and being adjusted to the conditions of the public company including the characteristic, capacity and size of the public company and effectiveness of the decision making by the Board of Directors.	Bank Mandiri has complied with Article 20 POJK 33/POJK.04/2014 on the Board of Directors and the Board of Commissioners of Issuers or Public Companies, namely the Board of Directors of Issuers or Public Companies consists of 2 (two) members. As of 31 December 2021, number of the Bank’s Directors are 12 (twelve) members, and has been stipulated based on complexity and requirements of the Bank. In the Board of Directors rules, the mechanism of decision making of the Board of Directors has been stipulated. Description: Comply
C.1.2.	Recommendation 13 : Determination on the composition of members of the Board of Directors takes into account on diversity of expertise, knowledge and required experience. Explanation : Similar with the Board of Commissioners, the composition diversity of members of the Board of Directors is a combination of required characteristic from both organ and individual perspective according to the needs of respective Public Company. The combination is determined in view of expertise, knowledge and experience in accordance with segregation of tasks and functions of the Board of Directors in achieving the purpose of the Public Company. Thus, consideration of the combination of characteristics will have an impact on the accuracy of the collegial nomination and appointment of individual member of the Board of Directors or Directors.	The determination of the Bank’s Board of Directors’ composition has taken into account the Bank’s needs and business complexity, namely by considering the diversity of skills, educational background, and professional experience, and is gender equality. The Board of Directors’ structure diversity is expected to provide alternative in resolving the increasingly complex issues faced by the Bank, compared to member of Directors that are naturally homogenic, thereby delivering the best decisions in the decision-making process. Description: Comply
C.1.3.	Recommendation 14 : Member of the Board of Directors in charge of accounting or finance has expertise and/or knowledge in accounting field. Explanation : The Financial Report is a management accountability report for resources management owned by the Public Company, which must be compiled and presented in accordance with Financial Accounting Standards in Indonesia as well as related OJK regulations, including regulation in the Capital Market sector which regulates the presentation and disclosure of Public Company Financial Statement. Based on the laws and regulations in the Capital Market sector that regulates the responsibility of the Board of Directors for the Financial Report, the Board of Directors is jointly responsible for the Financial Report, signed by the President Director and member of the Board of Directors in charge of accounting or finance. As such, the financial disclosure and information presented in the financial statements will be very much depending on the skills, and/or expertise of the Board of Directors, specifically member of the Board of Directors in charge of accounting or finance. With the qualifications and/or expertise in accounting that at least proficient by the concerned members of the Board of Directors, will ensure confidence in the preparation of financial statements, thereby the financial statements can be relied on by the stakeholders as a basic in decision making economically related to the concerned Public Company. The expertise and/or skills shall be affirmed by educational background, training certificates, and/or related work experiences.	The director in charge of accounting or finance at Bank Mandiri is the Director of Finance, namely Mr. Sigit Prastowo with experience and competence in the field of Treasury (Finance), who in carrying out his duties requires the knowledge in accounting. In addition, to support the implementation of his duties, he often participates in forums and seminars related to finance both at home and abroad. Description: Comply
C.2. Principle 6 : Enhancing the Quality of Implementation of Duties and Responsibilities of the Board of Directors.
C.2.1.	Recommendation 15 : The Board of Directors has Self-Assessment Policy to evaluate the performance of the Board of Directors. Explanation : Similar with the Board of Commissioners, the Board of Directors’ Self-Assessment policy is a guideline being used as a form of accountability to evaluate collegial performance of the Board of Directors. The self-assessment is conducted each member of the Board of Directors to assess the collegial performance of the Board of Directors, and not to assess the individual performance of each member of the Board of Directors. With this self-assessment, it is expected that each member of the Board of Directors can contribute to improve the performance of the Board of Directors on an ongoing basis. ****This policy can include the assessment activity as carried out along with the purpose and objective, periodic period of implementation, and benchmark or assessment criteria being used in accordance with the recommendations from the Remuneration and Nomination function of Public Company as required by OJK Regulation No.34/POJK.04/2014 on the Remuneration and Nomination Committee of Issuer or Public Company.	The Board of Directors has a self-assessment policy. The performance assessment of the Board of Directors is carried out by each member of the Board of Directors through a self-assessment mechanism to evaluate the performance of the Board of Directors collegially, and not to assess the individual performance of each member of the Board of Directors. As described in the Annual Report in the section of the Performance Assessment of the Board of Directors. Description: Comply
C.2.2	Recommendation 16 : The Self-Assessment Policy to evaluate the performance of the Board of Directors is disclosed in the Annual Report of Public Company. Explaination : The disclosure of Self-Assessment Policy on performance of the Board of Directors is conducted not only to comply with transparency aspect as form of accountability of its duties but also to provide assurance to the Shareholders or investors on efforts that need to be done in improving the performance of the Board of Commissioners. Upon the availability of disclosure, the Shareholders or investors acknowledge the check and balance mechanism towards the Board of Directors.	The self-Assessment policy on the performance of the Board of Directors has been disclosed in the 2021 Fiscal Year Annual Report. Description: Comply
C.2.3.	Recommendation 17 : The Board of Directors has policy on resignation of member of the Board of Commissioner when involved in financial crime. Explaination : The resignation policy of the Board of Directors involved in financial crimes is a policy that can increase the stakeholders’ trust in the Public Company, so that corporate integrity will be maintained. This policy is needed to help the legal process and so that the legal process does not interfere with the course of business activities. In addition, in terms of morality, this policy will build an ethical culture within the Public Company. This policy can cover in the Code or the Code of Ethics that applies to the Board of Directors. Furthermore, what is meant by being involved in a financial crime is the status of being convicted of a member of the Board of Directors from an authorized party. These financial crimes include manipulation and various forms of embezzlement in financial service activities as well as the Criminal Act of Money Laundering as referred to in Law No.8 of 2010 concerning Prevention and Eradication of Money Laundering.	Bank Mandiri has in place the policy on resignation of member of the Board of Directors when involved in financial crime as stated in the Bank’s Articles of Association. Referring to the Article 14 paragraph (26) letter f of the Bank’s Articles of Association, the tenure of member of the Board of Directors is ended if no longer meet the requirements as member of the Board of Directors based on the Articles of Association and other laws and regulations, including involvement in financial crime. In the event that a member of the Board of Directors is resigning including if involved in the financial crime, thus a concerned member of the Board of Directors shall inform in writing regarding his/her intention to the Bank, and the Bank shall convene the GMS to take decision on the resignation of a member of the Board of Directors within 90 days after the acceptance of the resignation. Description: Comply

No.

Aspect; Principle; Recommendation

Comply or Explain

C.1. Principle 5: Strengthen the Membership Composition of the Board of Directors.

C.1.1.

Recommendation 12 : Determination of total members of the Board of Directors takes into account on the condition of the Public Company and effectiveness in decision making.

Explanation : Being the Company’s organ that authorized in managing the Company, the determination of total members of the Board of Directors has significant impact to the Company’s performance. Thus, the determination of the total members of the Board of Directors must be done through careful consideration and refer to the provisions of the applicable regulation, whereby based on OJK Regulation No.33/POJK.04/2 14 on the Board of Directors and Board of Commissioners of Public Company, shall at least consists of 2 (two) people. In addition, the determination of total members of the Board of Directors must be based on the need to achieve the objectives and purpose of public company and being adjusted to the conditions of the public company including the characteristic, capacity and size of the public company and effectiveness of the decision making by the Board of Directors.

Bank Mandiri has complied with Article 20 POJK 33/POJK.04/2014 on the Board of Directors and the Board of Commissioners of Issuers or Public Companies, namely the Board of Directors of Issuers or Public Companies consists of 2 (two) members. As of 31 December 2021, number of the Bank’s Directors are 12 (twelve) members, and has been stipulated based on complexity and requirements of the Bank. In the Board of Directors rules, the mechanism of decision making of the Board of Directors has been stipulated.

Description: Comply

C.1.2.

Recommendation 13 : Determination on the composition of members of the Board of Directors takes into account on diversity of expertise, knowledge and required experience.

Explanation : Similar with the Board of Commissioners, the composition diversity of members of the Board of Directors is a combination of required characteristic from both organ and individual perspective according to the needs of respective Public Company. The combination is determined in view of expertise, knowledge and experience in accordance with segregation of tasks and functions of the Board of Directors in achieving the purpose of the Public Company. Thus, consideration of the combination of characteristics will have an impact on the accuracy of the collegial nomination and appointment of individual member of the Board of Directors or Directors.

The determination of the Bank’s Board of Directors’ composition has taken into account the Bank’s needs and business complexity, namely by considering the diversity of skills, educational background, and professional experience, and is gender equality. The Board of Directors’ structure diversity is expected to provide alternative in resolving the increasingly complex issues faced by the Bank, compared to member of Directors that are naturally homogenic, thereby delivering the best decisions in the decision-making process.

Description: Comply

C.1.3.

Recommendation 14 : Member of the Board of Directors in charge of accounting or finance has expertise and/or knowledge in accounting field.

Explanation : The Financial Report is a management accountability report for resources management owned by the Public Company, which must be compiled and presented in accordance with Financial Accounting Standards in Indonesia as well as related OJK regulations, including regulation in the Capital Market sector which regulates the presentation and disclosure of Public Company Financial Statement. Based on the laws and regulations in the Capital Market sector that regulates the responsibility of the Board of Directors for the Financial Report, the Board of Directors is jointly responsible for the Financial Report, signed by the President Director and member of the Board of Directors in charge of accounting or finance.

As such, the financial disclosure and information presented in the financial statements will be very much depending on the skills, and/or expertise of the Board of Directors, specifically member of the Board of Directors in charge of accounting or finance. With the qualifications and/or expertise in accounting that at least proficient by the concerned members of the Board of Directors, will ensure confidence in the preparation of financial statements, thereby the financial statements can be relied on by the stakeholders as a basic in decision making economically related to the concerned Public Company. The expertise and/or skills shall be affirmed by educational background, training certificates, and/or related work experiences.

The director in charge of accounting or finance at Bank Mandiri is the Director of Finance, namely Mr. Sigit Prastowo with experience and competence in the field of Treasury (Finance), who in carrying out his duties requires the knowledge in accounting. In addition, to support the implementation of his
duties, he often participates in forums and seminars
related to finance both at home and abroad.

Description: Comply

C.2. Principle 6 : Enhancing the Quality of Implementation of Duties and Responsibilities of the Board of Directors.

C.2.1.

Recommendation 15 : The Board of Directors has Self-Assessment Policy to evaluate the performance of the Board of Directors.

Explanation : Similar with the Board of Commissioners, the Board of Directors’ Self-Assessment policy is a guideline being used as a form of accountability to evaluate collegial performance of the Board of Directors. The self-assessment is conducted each member of the Board of Directors to assess the collegial performance of the Board of Directors, and not to assess the individual performance of each member of the Board of Directors. With this self-assessment, it is expected that each member of the Board of Directors can contribute to improve the performance of the Board of Directors on an ongoing basis.

This policy can include the assessment activity as carried out along with the purpose and objective, periodic period of implementation, and benchmark or assessment criteria being used in accordance with the recommendations from the Remuneration and Nomination function of Public Company as required by OJK Regulation No.34/POJK.04/2014 on the Remuneration and Nomination Committee of Issuer or Public Company.

The Board of Directors has a self-assessment policy. The performance assessment of the Board of Directors is carried out by each member of the Board of Directors through a self-assessment mechanism to evaluate the performance of the Board of Directors collegially, and not to assess the individual performance of each member of the Board of Directors. As described in the Annual Report in the section of the Performance Assessment of the Board of Directors.

Description: Comply

C.2.2 Recommendation 16 : The Self-Assessment Policy to evaluate the performance of the Board of Directors is disclosed in the Annual Report of Public Company.

Explaination : The disclosure of Self-Assessment Policy on performance of the Board of Directors is conducted not only to comply with transparency aspect as form of accountability of its duties but also to provide assurance to the Shareholders or investors on efforts that need to be done in improving the performance of the Board of Commissioners. Upon the availability of disclosure, the Shareholders or investors acknowledge the check and balance mechanism towards the Board of Directors.

The self-Assessment policy on the performance of the Board of Directors has been disclosed in the 2021 Fiscal Year Annual Report.

Description: Comply

C.2.3.

Recommendation 17 : The Board of Directors has policy on resignation of member of the Board of Commissioner when involved in financial crime.

Explaination : The resignation policy of the Board of Directors involved in financial crimes is a policy that can increase the stakeholders’ trust in the Public Company, so that corporate integrity will be maintained. This policy is needed to help the legal process and so that the legal process does not interfere with the course of business activities. In addition, in terms of morality, this policy will build an ethical culture within the Public Company. This policy can cover in the Code or the Code of Ethics that applies to the Board of Directors.

Furthermore, what is meant by being involved in a financial crime is the status of being convicted of a member of the Board of Directors from an authorized party. These financial crimes include manipulation and various forms of embezzlement in financial service activities as well as the Criminal Act of Money Laundering as referred to in Law No.8 of 2010 concerning Prevention and Eradication of Money Laundering.

Bank Mandiri has in place the policy on resignation of member of the Board of Directors when involved in financial crime as stated in the Bank’s Articles of Association.

Referring to the Article 14 paragraph (26) letter f of the Bank’s Articles of Association, the tenure of member of the Board of Directors is ended if no longer meet the requirements as member of the Board of Directors based on the Articles of Association and other laws and regulations, including involvement in financial crime. In the event that a member of the Board of Directors is resigning including if involved in the financial crime, thus a concerned member of the Board of Directors shall inform in writing regarding his/her intention to the Bank, and the Bank shall convene the GMS to take decision on the resignation of a member of the Board of Directors within 90 days after the acceptance of the resignation.

Description: Comply

D. Aspect 4: Stakeholders Participation

No.	Aspect; Principle; Recommendation	Comply or Explain
D.1. Principle 7: Enhancing Governance Aspect Through Stakeholders Participation.
D.1.1.	Recommendation 18 : The Public Company has the Policy to prevent Insider Trading. Explaination : A person with inside information is prohibited from conducting a Securities transaction by using inside information as stipulate under the Capital Market Law. Public company can minimize the occurrence of insider trading through prevention policies, for example by firmly separating between confidential and public data as well as distributing the duties and responsibilities on information management in proportional and efficient manner.	The policy to prevent insider trading is regulated in SP SDM Chapter III.C.2.c regarding the Code of Conduct regarding the Code of Conduct and Business Ethics, which are ethical standards that must be guided by all levels of the bank in carrying out daily duties and services and conducting business relations with customers, partners and colleagues. Chapter III.C.2.e regarding employee disciplinary regulations governing obligations, prohibitions and sanctions on employees. SP Corporate Secretary Chapter III.A.5 Principles of Information Disclosure, which regulates: Insiders who have insider information are prohibited from influencing any party, including the Insider’s family, to buy or sell shares Insiders other than the Board of Directors and the Board of Commissioners who commit violations as stipulated above and are proven to have carried out transactions and/or provide insider information will be subject to disciplinary sanctions as stipulated in the Human Resources Guidelines Standards (SPSDM) The Board of Directors and the Board of Commissioners and parties due to their position, profession/relationship with the Bank who carry out insider trading are liable to comply with applicable regulations Description: Comply
D.1.2.	Recommendation 19 : The Public Company has the anti-corruption and anti-fraud policies. Explaination : The anti-corruption policy ensures that the business activities of the Public Company are carried out legally, prudently and in accordance with the principles of good governance. The policy can be part of a code of ethics, or in a separate form. This policy may include, among others, the programs and procedures implemented in dealing with corrupt practices, kickbacks, fraud, bribery and/or gratuities in public companies. The scope of the policy must describe the prevention of the Public Company against all corrupt practices, either giving or receiving from other parties.	Gratuity Control Bank Mandiri realizes the gratuity control is vital to maintain business process in line with business ethics that uphold high integrity value. To that end, since 2013, Bank Mandiri has in place the Gift Disclosure Statement regulating the prohibition to accept gratification for all Employees, and since 2015, the Bank has in place the Gratification Control Unit to carry out gratuity control function at the Bank. In addition, gratuity control aims at building the values of good corporate governance and embedding integrity value to all employees there by all business activities with Customer, Vendor, Partner, and all Stakeholders are always founded upon ethics, mutual trusts, and responsibility. As such business interests can be performed properly and ethically while keeping in line with the gratuity prohibition rules. Currently, the Bank strives to carry out continuous improvement in implementing its gratuity control. Following up on KPK directives related to fair value limits and adjustments to the current conditions where the Bank in carrying out daily business activities shall maintain good cooperation relations with all stakeholders, as such the Bank has refined its Gratuity Control Operating Technical Manual effective as of 15 December 2021. Anti-Bribery Management System To foster the effort in eradicating corruption continuously, the Bank has received ISO 37001:2016 certificate of Anti-Bribery Management System on 10 August 2020 and has successfully received recommendation letter on Surveillance Audit dated 8 September 2021, to maintain the ISO 27001:2016 SMAP certificate. Anti-Fraud Strategy In compliance with OJK Regulation No. 39/POJK.03/2019 regarding the Anti-Fraud Strategy Application for Commercial Banks, and as one parts of Internal Control Policy refinement, the Bank has refined such rules. This was also carried out on every policy, such as Standard Operating Procedures, Operating Technical Manual and other regulations. Bank Mandiri Anti-Fraud Strategy regulates 4 pillars, which are : 1. Pillar 1 (Prevention) A responsibility of all operating units and as part of Fraud Control System to reduce the potential of fraud. Programs under this pillar are as follows : a. Anti-Fraud Awareness, such as development and dissemination of Anti- Fraud Statement, Employee Awareness Program and Customer Awareness Program. Disclosure of fraud awareness via email blast to all employees and the use of social media on fraud awareness information to the Customer were carried out during the year. b. Identification of Vulnerabilities, such as Risk Management application where all policies and procedures are designed by taking into account internal control, GCG principles application, and Compliance. Implementation of jobs by employee according to authority and responsibility are stated in the job description of each employee, and signed by employee. Moreover, the Annual Disclosure has been signed by all employee at the beginning of the year. c. Know Your Employee (KYE) Policy, such as Pre-employee Screening, System Qualification Selection Program and Know Your Employee Screening. KYE has been implemented upon recruitment by the Human Capital or directly by work unit. 2. Pillar 2 (Detection) A responsibility of all units, from 1st line, 2nd line, to 3rd line of defense and as part of fraud control to identify and find fraud in the Bank business activities. Programs under this pillar are as follows : a. Whistleblowing, whistleblowing management has been exercised, and managed by independent party to minimise conflict of interest and provide safety to whistleblowers. b. Fraud Detection System, has been implemented to support the Bank’s detection activity for retail channel transaction and retail loans segments (Micro, Consumer, and SME). c. Surprise Audit, a Surprise Audit is prioritised for high-risk or fraudvulnerable business units. d. Surveillance System, implementation of Surveillance System aims at monitoring and examining the effectiveness of internal control system (including fraud control system). 3. Pillar 3 (Investigation, Reporting, Sanctions and Legal Process) As part of Fraud Control System to handle fraud occurring through investigations and the results are reported to the President Director, Board of Commissioners, and Regulators, including the proposals on sanctions and legal process for the violators. In strengthening the functions of Pillar 3, delegation of authority on investigation and sanctions to each region were carried out to accelerate cases handling and recovery processes. 4. Pillar 4 (Monitoring, Evaluation, and Follow Up) As part of Fraud Control System to monitoring follow up on investigation results and fraud evaluation, to improve weaknesses and strengthen Internal Control System in order to prevent reoccurrence of fraud resulted from the same gaps. A written reporting to the President Director, and the Board of Commissioners is carried out properly to monitor follow up list that has been set. Description: Comply
D.1.3.	Recommendation 20 : The Public Company has policy on vendor or supplier selection and capability improvement. Explaination : The Policy on vendor or supplier selection is use fulto ensure that the Public Company can obtain the required goods or services at competitive prices and good quality. While the policy of increasing the capability of supplier or vendor is useful for ensuring the efficient and effective supply chain. The capability of supplier or vendor to supply/fulfill the goods or services needed by the company will affect the quality of the company’s output. Thus, the implementation of these policies can guarantee the supply continuity in terms of quantity and quality as required by the Public Company. The scope of this policy includes criteria in selecting supplier or vendor, transparent procurement mechanism, effort to improve supplier or vendor capability, and fulfill the right relating to supplier or vendor.	Bank Mandiri has a policy regarding Selection and Capacity Building for Suppliers or Vendors, namely : 1. Operational Policy (KOPR), article 205 on Operational Facilities and Infrastructure - Procurement (Procurement) 2. Procurement Standard Operational Guidelines (SPO) that regulate, among others (Chapter III): A. General provisions include: 1) Principles of Procurement 2) Procurement Ethics 3) Purpose of the Procurement Process 4) Monitoring of Domestic Products 5) Procurement Planning 6) Loading Guidelines B. Provisions for the implementation of the procurement of goods and services include: 1) Procedures for Procurement of Goods and Services 2) Procurement Process 3) Stages of the Procurement Process 4) Execution of Work and Handover of Work 5) Provisions for Change of Work (plus/minus) specifically in the field of construction implementation services. 6) Implementation of Procurement Activities to Overcome Certain Conditions. 7) Document and Payment Process. 3. Procurement Operational Technical Guidelines (PTO) that regulate, among others (Chapter III): A. Implementation Provisions 1. Accreditation Partners (Goods and Services Providers) a. General & including aspects that are reviewed in carrying out the qualifications of prospective Goods and Services Providers) b. Procedures for partner accreditation (Goods and Services Providers) (including aspects considered in determining recommended partners to be invited in a procurement process) c. Partner Monitoring includes: 1) Monitoring Partner Data 2) Partner Performance Monitoring, which consists of: a. Evaluation of Partner Performance Periodically b. Evaluation of Partner Performance based on Contract 3) Increasing Partner Competence 4) Sanctions for Associates Description: Comply
D.1.4.	Recommendation 21 : The Public Company has a policy on fulfilling creditors’ rights. Explaination : The policy on fulfilling creditor rights is used as a guide in making loans to creditors. The purpose of this policy is to maintain the fulfillment of rights and maintain creditor trust in the Public Company. The policy includes considerations in entering into agreements, as well as follow-up actions in fulfilling Public Company obligations to creditors.	The fulfilment of creditors’ rights at Bank Mandiri is stated in the loan agreement with creditor. The following creditors’ rights are stated in the agreement, among others : Receive the audited financial statements; Receive the loan progress/use report; Receive late sanction on report submission; Receive written notification, request, and approval Description: Comply
D.1.5.	Recommendation 22 : Public Company has a whistleblowing system policy. Explaination : A well-developed Whistleblowing system policy will provide certainty of protection to witness or reporter for an indication of violation committed by employees or management of the Public Company. The implementation of the policy will have an impact on establishing a culture of good corporate governance. The Whistleblowing system policy includes, among others, type of violations that can be reported through the Whistleblowing system, complaint procedure, protection and guarantee of the confidentiality of the reporter, handling procedure for received complaints, parties that managing the complaints, and the results and follow-up of complaints handling.	Implementation of the Whistleblowing system at Bank Mandiri is called the Letter to CEO (LTC). LTC is a facility for reporting fraud or indications of fraud from Bank Mandiri employees and stakeholders to the President Director with an emphasis on disclosure of complaints to increase the effectiveness of the implementation of the internal control system within Bank Mandiri. Bank Mandiri’s LTC has been implemented since 2009 with the LTC arrangement in the Letter to CEO (LTC) Technical Operational Manual which is continuously updated with the latest update on 7 December 2020. Since its revitalization in 2018, LTC management has involved independent parties to provide a safe-environment that encourages employees and stakeholders to dare to report. The reporter can include his complete identity or anonymously (the identity is only known by independent parties). Submission of LTC reports can be submitted through the following media: Website https://whistleblowing.tips/wbs/@bmrilettertoceo Email to bmri-lettertoceo@rsm.id Letter to POBOX 1007 JKS 12007 SMS and WA to 0811-9007777 Description: Comply
D.1.6.	Recommendation 23 : The Public Company has a long-term incentive policy for the Board of Directors and employees. Explanation : Long-term incentive is a given incentive based long-term performance achievement. The longterm incentive plan has the rationale that the longterm performance of the company is reflected in the growth of shares value or other long-term target of the company. Long-term incentive shall have the benefit to maintain loyalty and provide motivation to the Board of Directors and employees to improve their performance or productivity, which will have an impact on improving the company’s performance in the long run. The availability of a long-term incentive policy is an actual commitment by the Public Company to encourage the implementation of long-term incentive to the Board of Directors and Employees with terms, procedures and forms being adjusted to the long-term objectives of the Public Company. The policy can include, amongst other, the purpose of objective in providing the long-term incentive, terms and procedures in providing the incentive, and condition as well as risks that must be considered by the Public Company in providing the incentives. This policy can also be included in the existing public company remuneration policy.	Bank Mandiri has a policy of providing long-term incentives to Commissioners and Directors according to the provisions in POJK No. 45/POJK.03/2015 concerning Implementation of Governance in Providing Remuneration for Commercial Banks. Bank Mandiri implements Governance in the Provision of Remuneration that has considered various aspects, including bank financial stability, the creation of risk management, short-term and long-term liquidity needs, and potential future income. Bank Mandiri can postpone deferred variable remuneration (Malus) or withdraw variable remuneration that has been paid (Clawback) to officials who are classified as Material Risk Taker (MRT). Description: Comply

No.

Aspect; Principle; Recommendation

Comply or Explain

D.1. Principle 7: Enhancing Governance Aspect Through Stakeholders Participation.

D.1.1.

Recommendation 18 : The Public Company has the Policy to prevent Insider Trading.

Explaination : A person with inside information is prohibited from conducting a Securities transaction by using inside information as stipulate under the Capital Market Law. Public company can minimize the occurrence of insider trading through prevention policies, for example by firmly separating between confidential and public data as well as distributing the duties and responsibilities on information management in proportional and efficient manner.

The policy to prevent insider trading is regulated in SP SDM

Chapter III.C.2.c regarding the Code of Conduct regarding the Code of Conduct and Business Ethics, which are ethical standards that must be guided by all levels of the bank in carrying out daily duties and services and conducting business relations with customers, partners and colleagues.
Chapter III.C.2.e regarding employee disciplinary regulations governing obligations, prohibitions and sanctions on employees.

SP Corporate Secretary
Chapter III.A.5 Principles of Information Disclosure, which regulates:

Insiders who have insider information are prohibited from influencing any party, including the Insider’s family, to buy or sell shares
Insiders other than the Board of Directors and the Board of Commissioners who commit violations as stipulated above and are proven to have carried out transactions and/or provide insider information will be subject to disciplinary sanctions as stipulated in the Human Resources Guidelines Standards (SPSDM)
The Board of Directors and the Board of Commissioners and parties due to their position, profession/relationship with the Bank who carry out insider trading are liable to comply with applicable regulations

Description: Comply

D.1.2.

Recommendation 19 : The Public Company has the anti-corruption and anti-fraud policies.

Explaination : The anti-corruption policy ensures that the business activities of the Public Company are carried out legally, prudently and in accordance with the principles of good governance. The policy can be part of a code of ethics, or in a separate form. This policy may include, among others, the programs and procedures implemented in dealing with corrupt practices, kickbacks, fraud, bribery and/or gratuities in public companies. The scope of the policy must describe the prevention of the Public Company against all corrupt practices, either giving or receiving from other parties.

Gratuity Control

Bank Mandiri realizes the gratuity control is vital to maintain business process in line with business ethics that uphold high integrity value. To that end, since 2013, Bank Mandiri has in place the Gift Disclosure Statement regulating the prohibition to accept gratification for all Employees, and since 2015, the Bank has in place the Gratification Control Unit to carry out gratuity control function at the Bank.

In addition, gratuity control aims at building the values of good corporate governance and embedding integrity value to all employees there by all business activities with Customer, Vendor, Partner, and all Stakeholders are always founded upon ethics, mutual trusts, and responsibility. As such business interests can be performed properly and ethically while keeping in line with the gratuity prohibition rules. Currently, the Bank strives to carry out continuous improvement in implementing its gratuity control.

Following up on KPK directives related to fair value limits and adjustments to the current conditions where the Bank in carrying out daily business activities shall maintain good cooperation relations with all stakeholders, as such the Bank has refined its Gratuity Control Operating Technical Manual effective as of 15 December 2021.

Anti-Bribery Management System
To foster the effort in eradicating corruption continuously, the Bank has received ISO 37001:2016 certificate of Anti-Bribery Management System on 10 August 2020 and has successfully received recommendation letter on Surveillance Audit dated 8 September 2021, to maintain the ISO 27001:2016 SMAP certificate.

Anti-Fraud Strategy
In compliance with OJK Regulation No. 39/POJK.03/2019 regarding the Anti-Fraud Strategy Application for Commercial Banks, and as one parts of Internal Control Policy refinement, the Bank has refined such rules. This was also carried out on every policy, such as Standard Operating Procedures, Operating Technical Manual and other regulations.

Bank Mandiri Anti-Fraud Strategy regulates 4 pillars, which are :

1. Pillar 1 (Prevention)
A responsibility of all operating units and as part of Fraud Control System to reduce the potential of fraud. Programs under this pillar are as follows :

a. Anti-Fraud Awareness, such as development and dissemination of Anti-
Fraud Statement, Employee Awareness Program and Customer Awareness Program. Disclosure of fraud awareness via email blast to all employees and the use of social media on fraud awareness information to the Customer were carried out during the year.

b. Identification of Vulnerabilities, such as Risk Management application where all policies and procedures are designed by taking into account internal control, GCG principles application, and Compliance. Implementation of jobs by employee according to authority and responsibility are stated in the job description of each employee, and signed by employee. Moreover, the Annual Disclosure has been signed by all employee at the beginning of the year.

c. Know Your Employee (KYE) Policy, such as Pre-employee Screening, System Qualification Selection Program and Know Your Employee Screening. KYE has been implemented upon recruitment by the Human Capital or directly by work unit.

2. Pillar 2 (Detection)
A responsibility of all units, from 1st line, 2nd line, to 3rd line of defense and as part of fraud control to identify and find fraud in the Bank business activities. Programs under this pillar are as follows :

a. Whistleblowing, whistleblowing management has been exercised, and managed by independent party to minimise conflict of interest and provide safety to whistleblowers.

b. Fraud Detection System, has been implemented to support the Bank’s detection activity for retail channel transaction and retail loans segments (Micro, Consumer, and SME).

c. Surprise Audit, a Surprise Audit is prioritised for high-risk or fraudvulnerable business units.

d. Surveillance System, implementation of Surveillance System aims at monitoring and examining the effectiveness of internal control system (including fraud control system).

3. Pillar 3 (Investigation, Reporting, Sanctions and Legal Process)
As part of Fraud Control System to handle fraud occurring through investigations and the results are reported to the President Director, Board of Commissioners, and Regulators, including the proposals on sanctions and legal process for the violators. In strengthening the functions of Pillar 3, delegation of authority on investigation and sanctions to each region were carried out to accelerate cases handling and recovery processes.

4. Pillar 4 (Monitoring, Evaluation, and Follow Up)
As part of Fraud Control System to monitoring follow up on investigation results and fraud evaluation, to improve weaknesses and strengthen Internal Control System in order to prevent reoccurrence of fraud resulted from the same gaps. A written reporting to the President Director, and the Board of Commissioners is carried out properly to monitor follow up list that has been set.

Description: Comply

D.1.3.

Recommendation 20 : The Public Company has policy on vendor or supplier selection and capability improvement.

Explaination : The Policy on vendor or supplier selection is use fulto ensure that the Public Company can obtain the required goods or services at competitive prices and good quality. While the policy of increasing the capability of supplier or vendor is useful for ensuring the efficient and effective supply chain. The capability of supplier or vendor to supply/fulfill the goods or services needed by the company will affect the quality of the company’s output.

Thus, the implementation of these policies can guarantee the supply continuity in terms of quantity and quality as required by the Public Company. The scope of this policy includes criteria in selecting supplier or vendor, transparent procurement mechanism, effort to improve supplier or vendor capability, and fulfill the right relating to supplier or vendor.

Bank Mandiri has a policy regarding Selection and Capacity Building for Suppliers or Vendors, namely :
1. Operational Policy (KOPR), article 205 on Operational Facilities and Infrastructure - Procurement (Procurement)
2. Procurement Standard Operational Guidelines (SPO) that regulate, among others (Chapter III):

A. General provisions include:

1) Principles of Procurement
2) Procurement Ethics
3) Purpose of the Procurement Process
4) Monitoring of Domestic Products
5) Procurement Planning
6) Loading Guidelines

B. Provisions for the implementation of the procurement of goods and services include:

1) Procedures for Procurement of Goods and Services
2) Procurement Process
3) Stages of the Procurement Process
4) Execution of Work and Handover of Work
5) Provisions for Change of Work (plus/minus) specifically in the field of construction implementation services.
6) Implementation of Procurement Activities to Overcome Certain Conditions.
7) Document and Payment Process.

3. Procurement Operational Technical Guidelines (PTO) that regulate, among others (Chapter III):

A. Implementation Provisions

1. Accreditation Partners (Goods and Services Providers)

a. General & including aspects that are reviewed in carrying out the qualifications of prospective Goods and Services Providers)
b. Procedures for partner accreditation (Goods and Services Providers) (including aspects considered in determining recommended partners to be invited in a procurement process)

c. Partner Monitoring includes:

1) Monitoring Partner Data
2) Partner Performance Monitoring, which consists of:

a. Evaluation of Partner Performance Periodically
b. Evaluation of Partner Performance based on Contract

3) Increasing Partner Competence
4) Sanctions for Associates

Description: Comply

D.1.4.

Recommendation 21 : The Public Company has a policy on fulfilling creditors’ rights.

Explaination : The policy on fulfilling creditor rights is used as a guide in making loans to creditors. The purpose of this policy is to maintain the fulfillment of rights and maintain creditor trust in the Public Company. The policy includes considerations in entering into agreements, as well as follow-up actions in fulfilling Public Company obligations to creditors.

The fulfilment of creditors’ rights at Bank Mandiri is stated in the loan agreement with creditor.
The following creditors’ rights are stated in the agreement, among others :

Receive the audited financial statements;
Receive the loan progress/use report;
Receive late sanction on report submission;
Receive written notification, request, and approval

Description: Comply

D.1.5.

Recommendation 22 : Public Company has a whistleblowing system policy.

Explaination : A well-developed Whistleblowing system policy will provide certainty of protection to witness or reporter for an indication of violation committed by employees or management of the Public Company. The implementation of the policy will have an impact on establishing a culture of good corporate governance. The Whistleblowing system policy includes, among others, type of violations that can be reported through the Whistleblowing system, complaint procedure, protection and guarantee of the confidentiality of the reporter, handling procedure for received complaints, parties that managing the complaints, and the results and follow-up of complaints handling.

Implementation of the Whistleblowing system at Bank Mandiri is called the Letter to CEO (LTC). LTC is a facility for reporting fraud or indications of fraud from Bank Mandiri employees and stakeholders to the President Director with an emphasis on disclosure of complaints to increase the effectiveness of the implementation of the internal control system within Bank Mandiri.
Bank Mandiri’s LTC has been implemented since 2009 with the LTC arrangement in the Letter to CEO (LTC) Technical Operational Manual which is continuously updated with the latest update on 7 December 2020.
Since its revitalization in 2018, LTC management has involved independent parties to provide a safe-environment that encourages employees and stakeholders to dare to report. The reporter can include his complete identity or anonymously (the identity is only known by independent parties).
Submission of LTC reports can be submitted through the following media:

Website https://whistleblowing.tips/wbs/@bmrilettertoceo
Email to bmri-lettertoceo@rsm.id
Letter to POBOX 1007 JKS 12007
SMS and WA to 0811-9007777

Description: Comply

D.1.6.

Recommendation 23 : The Public Company has a long-term incentive policy for the Board of Directors and employees.

Explanation : Long-term incentive is a given incentive based long-term performance achievement. The longterm incentive plan has the rationale that the longterm performance of the company is reflected in the growth of shares value or other long-term target of the company. Long-term incentive shall have the benefit to maintain loyalty and provide motivation to the Board of Directors and employees to improve their performance or productivity, which will have an impact on improving the company’s performance in the long run.

The availability of a long-term incentive policy is an actual commitment by the Public Company to encourage the implementation of long-term incentive to the Board of Directors and Employees with terms, procedures and forms being adjusted to the long-term objectives of the Public Company. The policy can include, amongst other, the purpose of objective in providing the long-term incentive, terms and procedures in providing the incentive, and condition as well as risks that must be considered by the Public Company in providing the incentives. This policy can also be included in the existing public company remuneration policy.

Bank Mandiri has a policy of providing long-term incentives to Commissioners and Directors according to the provisions in POJK No. 45/POJK.03/2015 concerning Implementation of Governance in Providing Remuneration for Commercial Banks. Bank Mandiri implements Governance in the Provision of Remuneration that has considered various aspects, including bank financial stability, the creation of risk management, short-term and long-term liquidity needs, and potential future income.
Bank Mandiri can postpone deferred variable remuneration (Malus) or withdraw variable remuneration that has been paid (Clawback) to officials who are classified as Material Risk Taker (MRT).

Description: Comply

E. Aspect 5: Information Disclosure

No.	Aspect; Principle; Recommendation	Comply or Explain
E.1. Principle 8 : Enhancing the Disclosure Implementation.
E.1.1.	Recommendation 24 : The Public Company utilizes technology information wider than the Website as a media for information disclosure. Explanation : The use of information technology can be useful as a medium for information disclosure. The disclosure of information that is carried out is not only disclosure of information that has been regulated in the laws and regulations, but also other information related to the Public Company which is deemed beneficial for shareholders or investors to know. With the wider use of information technology in addition to the Web site, it is hoped that the company can increase the effectiveness of the company’s information dissemination. Even so, the use of information technology is carried out by taking into account the benefits and costs of the company.	Bank Mandiri managed the Company’s Website as optimal as possible to always provide the most recent and accurate information for the Public. Apart from the website, Bank Mandiri also utilizes technology and other social media applications such as SMS Banking, Mobile Banking, Instagram, Facebook and Twitter for information disclosure media. Description: Comply
E.1.2.	Recommendation 25 : The Annual Report of the Public Company discloses the ultimate beneficial owner in the share ownership of the Public Company of at least 5% (five percent), in addition to disclosing the ultimate beneficial owner in the share ownership of the Public Company through the major and controlling shareholders. Explaination : The Capital Market Regulation that regulates the submission of annual reports of Public Company has regulated the obligation to Disclose information regarding shareholders with 5% (five percent) or more shares of the Public Company, as well as the obligation to disclose information about directly or indirectly main and controlling shareholders of Public Company up to the owner of the last benefit in the ownership of the shares. In this Governance Guideline, it is recommended to disclose the ultimate benefit owner of the shares of the Public Company at least 5% (five percent), in addition to disclosing the owner of the final benefit of share ownership by the main and controlling shareholders.	Bank Mandiri has disclosed information regarding shareholders with 5% or more shareholding of the Company’s shares in the 2021 Annual Report. Description: Comply

No.

Aspect; Principle; Recommendation

Comply or Explain

E.1. Principle 8 : Enhancing the Disclosure Implementation.

E.1.1.

Recommendation 24 : The Public Company utilizes technology information wider than the Website as a media for information disclosure.

Explanation : The use of information technology can be useful as a medium for information disclosure. The disclosure of information that is carried out is not only disclosure of information that has been regulated in the laws and regulations, but also other information related to the Public Company which is deemed beneficial for shareholders or investors to know. With the wider use of information technology in addition to the Web site, it is hoped that the company can increase the effectiveness of the company’s information dissemination. Even so, the use of information technology is carried out by taking into account the benefits and costs of the company.

Bank Mandiri managed the Company’s Website as optimal as possible to always provide the most recent and accurate information for the Public. Apart from the website, Bank Mandiri also utilizes technology and other social media applications such as SMS Banking, Mobile Banking, Instagram, Facebook and Twitter for information disclosure media.

Description: Comply

E.1.2.

Recommendation 25 : The Annual Report of the Public Company discloses the ultimate beneficial owner in the share ownership of the Public Company of at least 5% (five percent), in addition to disclosing the ultimate beneficial owner in the share ownership of the Public Company through the major and controlling shareholders.

Explaination : The Capital Market Regulation that regulates the submission of annual reports of Public Company has regulated the obligation to Disclose information regarding shareholders with 5% (five percent) or more shares of the Public Company, as well as the obligation to disclose information about directly or indirectly main and controlling shareholders of Public Company up to the owner of the last benefit in the ownership of the shares. In this Governance Guideline, it is recommended to disclose the ultimate benefit owner of the shares of the Public Company at least 5% (five percent), in addition to disclosing the owner of the final benefit of share ownership by the main and controlling shareholders.

Bank Mandiri has disclosed information regarding shareholders with 5% or more shareholding of the Company’s shares in the 2021 Annual Report.

Description: Comply

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Implementation of Corporate Governance - GCG

Banner Implement of CG

Implementation of GCG Practice in Public Company

Implementation of GCG Practice in Public Company

No.

Aspect; Principle; Recommendation

Comply or Explain

A.1. Principle 1: Increase the Value of the General Meeting of Shareholders (GMS).

A.1.1.

Recommendation 1 : The Public Company has technical means or procedure for both open and closed voting that prioritize independency and interest of Shareholders.

Explanation : Every issued share with voting right has one vote (one share one vote). The Shareholders may use their voting rights during the decision-making process, in particular to decision with voting mechanism. However, both open and closed voting mechanism has not been regulated in details.

The Annual General Meeting of Shareholders (GMS) and Extraordinary GMS, Bank Mandiri has exercised open and close voting which is stated in the GMS Mechanisms.

The voting mechanism at the GMS is regulated in the Bank’s Articles of Association.

​​​​​​​The Bank has developed the GMS Procedures that can be downloaded in the Company’s website and were distributed to the Shareholders during the GMS.

Description : Comply

A.1.2.

​​​​​​​Recommendation 2 : All members of the Board of Directors and the Board of Commissioners of Public Company attends the Annual GMS.

The Annual GMS Fiscal Year 2021 was attended by all members of the Board of Commissioners and Board of Directors

Description: Comply

A.1.3.

Recommendation 3 : The Summary of Minutes of GMS is available in the Public Company’s website at least for one (1) year.

​​​​​​​In addition, the Bank has also provided the GMS Highlights in both Indonesian and English languages that was uploaded in the website in 1 (one) working day after the GMS convention.

Description : Comply

A.2. Principle 2 : Enhancing the Quality of Communication between Public Company with Shareholders or Investors.

A.2.1.

Recommendation 4: Public Company has communication policy with the Shareholders and Investors.

​​​​​​​The Bank has a communication policy with shareholders or investors, as stipulated in the Corporate Secretary Charter, Chapter III.A.I. Disclosures.

The disclosure to the stakeholders is formulated by referring to the Capital Market regulations and other relevant laws and regulations, which can be summarized as follows :

Periodic and or incidental reporting to regulators (OJK, Bank Indonesia, LPS, Ministry of Justice and Human Rights, Indonesia Stock Exchange) and reporting through Electronic Reporting System.

General Meeting of Shareholders (GMS)

Implemented according to laws and the Bank’s Articles of Association consisted of the Annual GMS and Extraordinary GMS.

The Bank has developed the GMS Procedures that can be downloaded in the Company’s website and were distributed to the Shareholders during the GMS.

Recommendation 2 : All members of the Board of Directors and the Board of Commissioners of Public Company attends the Annual GMS.

In addition, the Bank has also provided the GMS Highlights in both Indonesian and English languages that was uploaded in the website in 1 (one) working day after the GMS convention.

The Bank has a communication policy with shareholders or investors, as stipulated in the Corporate Secretary Charter, Chapter III.A.I. Disclosures.

The Bank also has established specific unit that is tasked to maintain and manage good relations with investors, as well as serve as a centre of information on the Bank’s performance to the investors.

Recommendation 5 : The Public Company discloses the Communication
Policy of Public Company with shareholders or
investors in Website.

Recommendation 6 : Determination of total members of the Board of
Commissioners takes into account the conditions
of the Public Company.

Identifying candidates for the Board of Directors, both from within and from outside, and candidates for the Board of Commissioners who meet the requirements
to be proposed/appointed as Director or Board of Commissioners.