For companies transitioning into public entities, the existence of a well-structured Board of Directors (BOD) and Board of Commissioners (BOC) is not merely a formality but an essential component of sound corporate governance. The Board of Directors is fully responsible for the management and legal representation of the company, both in and out of court, as stipulated in Articles 2 and 15 of OJK Regulation No. 33/POJK.04/2014. Meanwhile, the Board of Commissioners has the duty to supervise the management policies and provide advice to the Board of Directors, as set out in Article 28 of the same regulation.
To be appointed as a member of the BOD or BOC, an individual must meet several key requirements as outlined in Articles 4 and 21. These include having good character and integrity, being legally competent, not having a history of bankruptcy or criminal convictions related to financial misconduct, and possessing the knowledge or expertise relevant to the company’s line of business. These requirements must be fulfilled not only at the time of appointment but also throughout the term of office. In addition, Article 21 paragraph (2) imposes stricter conditions for Independent Commissioners, who must be unaffiliated with the company, its controlling shareholders, or management, and must not hold any shares or have any business relationships with the company to ensure their objectivity and independence in supervisory roles.
The regulation allows for multiple directorships, but with strict limitations. According to Article 6, a Director may concurrently serve as a Director in only one other public company, as a Commissioner in up to three other public companies, and as a committee member in up to five committees within companies where they also serve as Director or Commissioner. Meanwhile, Article 24 stipulates that a Commissioner may concurrently serve as a Director in two other public companies and as a Commissioner in two other public companies, or in four other public companies if not serving as a Director. If these limits are breached, the company is required to hold a General Meeting of Shareholders (GMS) to replace the individual, as mandated under Articles 5 and 22.
In the IPO context, having Directors and Commissioners who meet regulatory requirements is not only a matter of compliance but also a key signal of governance quality for potential investors. The credibility, integrity, and professionalism of the leadership team significantly influence market perception regarding the company’s future prospects and sustainability.
In conclusion, meeting the requirements for the Board of Directors and Board of Commissioners as stipulated in OJK Regulation No. 33/POJK.04/2014 is a fundamental step for any company preparing to go public. It is not merely about satisfying legal formalities but about laying the groundwork for investor trust, long-term value creation, and responsible leadership in the public market.
If you, a prospective client, have further inquiries about the topic discussed above, Schinder Law Firm is one of the leading corporate law firms in Indonesia, with extensive experience handling similar matters. Our team of professional corporate and civil lawyers makes us one of the top consulting firms in Indonesia. Feel free to contact us at info@schinderlawfirm.com for further consultation.
Author:
Dewi Susanti