Juridical Review of the Position of Independent Commissioners in Realizing Good Corporate Governance in Public Companies

Oct 13, 2025 by vinooalluri.com 50 views

Juridical Review of the Position of Independent Commissioners in Realizing Good Corporate Governance in Public Companies

Introduction

In the business world, public companies have a significant responsibility to manage funds received from the public. One way to fulfill these responsibilities is to apply the practice of Good Corporate Governance (GCG). The application of GCG in public companies requires collaboration between various parties, especially between shareholders, directors, and commissioners. Commissioners, as supervisors, are expected to carry out their duties independently and responsibly in the interests of the company and all stakeholders. However, in practice, many commissioners did not carry out the oversight function well, thus encouraging the emergence of the position of independent commissioners in the Board of Commissioners.

Independent commissioners play an important role in creating a more objective and oriented environment in the interests of all stakeholders. Unfortunately, Law Number 1 of 1995 concerning Limited Liability Companies (UUPT) has not regulated the position of the Independent Commissioner clearly. This study aims to analyze the position of the position of independent commissioners legally, understand the relationship of independent commissioners with other company organs in supporting the practice of GCG, as well as exploring the responsibilities of independent commissioners in the juridical context.

The Role of Independent Commissioners in Good Corporate Governance

Independent Commissioners must operate within a solid legal framework in order to be able to carry out their functions effectively. Although the position of the independent commissioner is not strictly regulated in the UUPT, their existence must be strengthened through company internal regulations and clearer guidelines regarding their responsibilities. The responsibility of the independent commissioner juridically remains in line with other commissioners, however, because of their appointment and position as chairman of the Audit Committee, they have a greater burden of responsibility.

Independent Commissioners are expected to be able to establish close cooperation with other company organs, such as directors and shareholders, to ensure that GCG practices are well implemented. Good and transparent relationships between independent commissioners and other company organs can increase the effectiveness of supervision and encourage better GCG implementation. This is because independent commissioners can provide an objective perspective on the company's operations, which can help to identify potential risks and areas for improvement.

The Importance of Clear Regulatory Arrangements

As part of an effort to strengthen the position of the independent commissioners, there needs to be a clearer arrangement regarding their functions and responsibilities in the Law. This is important so that independent commissioners can carry out their mandate more effectively and carry out their roles in maintaining accountability and transparency in the company. Strict regulations will also provide legal certainty for all parties involved, and encourage companies to be more disciplined in implementing GCG.

In this context, the mechanism for the appointment of independent commissioners by the General Meeting of Shareholders (GMS) must also be carefully designed. The transparent and clear criteria-based selection process will produce independent commissioners who can truly carry out their functions optimally. This is because the appointment of independent commissioners is a critical step in ensuring that they are able to carry out their roles effectively.

The Relationship Between Independent Commissioners and Other Company Organs

In addition, independent commissioners can also play a critical role in ensuring that the company's financial statements are accurate and transparent. This is because independent commissioners are responsible for reviewing the company's financial statements and ensuring that they are in compliance with relevant laws and regulations.

The Responsibilities of Independent Commissioners

Independent Commissioners have a number of responsibilities, including:

Reviewing the company's financial statements and ensuring that they are accurate and transparent
Establishing close cooperation with other company organs, such as directors and shareholders, to ensure that GCG practices are well implemented
Providing an objective perspective on the company's operations, which can help to identify potential risks and areas for improvement
Ensuring that the company's financial statements are in compliance with relevant laws and regulations

Conclusion

In order to support the practice of good corporate governance in public companies, the existence of independent commissioners is very vital. However, to maximize their role, it is necessary to have a clearer legal arrangement regarding their position and responsibility. Thus, independent commissioners can carry out their functions effectively and create a transparent and accountable company climate. This strengthening effort will not only improve the company's performance, but also gives more confidence from the community and other stakeholders to public companies.

Recommendations

Based on the findings of this study, the following recommendations are made:

The government should strengthen the position of independent commissioners by providing clearer guidelines regarding their responsibilities and functions.
Companies should establish close cooperation with independent commissioners to ensure that GCG practices are well implemented.
Independent commissioners should be appointed through a transparent and clear criteria-based selection process.
The government should provide legal certainty for all parties involved by establishing strict regulations regarding the appointment and responsibilities of independent commissioners.

By implementing these recommendations, it is hoped that the position of independent commissioners can be strengthened, and they can play a more effective role in supporting the practice of good corporate governance in public companies.
Frequently Asked Questions (FAQs) About the Position of Independent Commissioners in Realizing Good Corporate Governance in Public Companies

Q: What is the role of independent commissioners in a public company?

A: Independent commissioners play a critical role in creating a more objective and oriented environment in the interests of all stakeholders. They are responsible for reviewing the company's financial statements, establishing close cooperation with other company organs, and providing an objective perspective on the company's operations.

Q: What are the responsibilities of independent commissioners?

A: Independent commissioners have a number of responsibilities, including:

Reviewing the company's financial statements and ensuring that they are accurate and transparent
Establishing close cooperation with other company organs, such as directors and shareholders, to ensure that GCG practices are well implemented
Providing an objective perspective on the company's operations, which can help to identify potential risks and areas for improvement
Ensuring that the company's financial statements are in compliance with relevant laws and regulations

Q: How are independent commissioners appointed?

A: Independent commissioners are typically appointed by the General Meeting of Shareholders (GMS) through a transparent and clear criteria-based selection process.

Q: What is the importance of clear regulatory arrangements for independent commissioners?

A: Clear regulatory arrangements are essential for independent commissioners to carry out their functions effectively. This includes providing legal certainty for all parties involved, encouraging companies to be more disciplined in implementing GCG, and ensuring that independent commissioners can carry out their mandate more effectively.

Q: How can companies support the role of independent commissioners?

A: Companies can support the role of independent commissioners by establishing close cooperation with them, providing them with the necessary resources and information, and ensuring that they are able to carry out their functions effectively.

Q: What are the benefits of having independent commissioners in a public company?

A: The benefits of having independent commissioners in a public company include:

Improved transparency and accountability
Enhanced corporate governance practices
Increased confidence from the community and other stakeholders
Improved company performance

Q: What are the challenges faced by independent commissioners?

A: Independent commissioners may face a number of challenges, including:

Limited resources and information
Resistance from other company organs
Difficulty in establishing close cooperation with other company organs
Limited legal certainty

Q: How can the position of independent commissioners be strengthened?

A: The position of independent commissioners can be strengthened by:

Providing clearer guidelines regarding their responsibilities and functions
Establishing strict regulations regarding their appointment and responsibilities
Ensuring that they are able to carry out their functions effectively
Providing them with the necessary resources and information

By understanding the role and responsibilities of independent commissioners, companies can better support their efforts to promote good corporate governance and improve transparency and accountability.