ASEAN CG Scorecard

Principle and Recommendation

Implementation in the Company

Principle 1 Increase the value of the General Meetings of Shareholders (GMS).

Comply. The procedure is articulated in the GMS rules that are distributed to shareholders at each GMS.

2.    All members of the Board of Directors and Board of Commissioners attend the annual general meeting of shareholders.

Comply. As a manifestation of the Company’s compliance with policies set by the Government of the Republic of Indonesia in implementing preventive measures to spread of the Corona Virus Disease (COVID-19), and in consideration to the suggestion from the Government of the Republic of Indonesia to practice Social/Physical Distancing during the Large-Scale of Social Restriction (“PSBB”) and SOJK S-124/2020 dated 24 April 2020 concerning Certain Conditions in Organising an Electronic General Meeting of Shareholders of the Public Companies, the Company will hold an electronic meeting and apply a limitation to the attendance of shareholders. Therefore, the physical attendance of the Board of Directors and the Board of Commissioners in the Annual GMS held on 30 April 2021 were restricted.

3.  A summary of the minutes of AGMs should be available on the company’s website for at least one year.

Comply. The summary minutes of GMS is available in the Company’s official website, www.matahari.co.id for more than a year.

Principle 2 Strengthen the quality of communications between public companies and their shareholders or investors.

1. The company should have a policy on communications with its shareholders or investors.

Comply. The Company provides regular updates regarding the company’s performance through quarterly Financial reports.

3.    The communications policy should be disclosed on the website

Comply. The Company has provided the materials for every Earnings Call, conference, as well as presentation materials which can be downloaded from the Company’s website to give equality to all shareholders for the implementation of the communication with the Company.

Principle 3 Strengthen the membership and composition of the Board of Commissioners.

1.  The condition of the company should be considered in determining the number of members of the Board of Commissioners.

Comply. The number of members of the Board of Commissioners has met the prevailing capital market regulations.

2.  The composition of the Board of Commissioners should take into account the range of expertise, knowledge, and experience required by the Company.

Comply. The Board members represent the range of expertise, knowledge, and experience required by the Company as reflected in Profile of the Board of Commissioners of this Annual Report.

Principle 4 Strengthen the quality of execution of the Board of Commissioners’ duties and responsibilities.

1.  The Board of Commissioners should have a policy on self-assessment to evaluate its performance.

Comply. The Board of Commissioners has a policy on the regular evaluation of its performance by self- asessment.

2.   The self-assessment policy that evaluates the performance of the Board of Commissioners is disclosed in this year’s Annual Report of the public company.

Comply. Referring to the previous answer, the BoC self-assessment policy is disclosed in the Company’s Annual Report.

3.   The Board of Commissioners should have a policy on the resignation of board members who are involved in financial crimes.

Comply. Based on the Company’s Articles of Association, any member of the Board of Commissioners who is not qualified to be a member of the Board of Commissioners for any reason, including involvement in financial crimes, will have his/her position as a member of the Board declared null and void. If the Board member resigns, it will decided through the GMS.

4.  The Board of Commissioners or the Committee that performs the Nomination and Remuneration functions should have a succession policy for members of the Board of Directors.

Comply. The Nomination and Remuneration Committee, which is chaired by a member of BoC, has put in place a succession policy for the Board of Directors.

Principle 5 Strengthen the membership and composition of the Board of Directors.

1.  The condition of the company and effectiveness in decision making should be considered in determining the number of members of the Board of Directors.

Comply. Both the Company’s condition and effective decision making were taken into consideration in determining the number of members of the Board of Directors.

2.  The composition of the Board of Directors should take into account the range of expertise, knowledge and experience required by the Company

Comply. The current composition of the Board of Directors reflects the range of expertise, knowledge and experience required by the Company

3.  Members of the Board of Directors who are in charge of accounting or finance functions should have expertise in and/or knowledge of accounting.

Comply. The Company has a member of the Board of Directors who oversees accounting and finance as well as has expertise and knowledge in Accounting, Mr. Niraj Jain. His profile can be found in Profile of the Board of Directors of this Annual Report.

Principle 6 Strengthen the quality of execution of the Board of Directors’ duties and responsibilities.

1.  The Board of Directors should have a policy on self-assessment to evaluate its performance.

Comply. The Board of Directors has a policy on regular self-assessment based on their KPIs, the results of which are reviewed by the Nomination and Remuneration Committee.

2.  The self-assessment policy should be disclosed in the company’s annual report.

On progress to Comply. Referring to the previous answer, the Company has a policy of such self-assessment but not yet disclosed in Annual Report.

3.   The Board of Directors should have a policy on the resignation of Board members who are involved in financial crimes.

Comply. Based on the Company’s Articles of Association, any member of the Board of Directors who is not qualified to be a member of the Board of Directors for any reason, including involvement in financial crimes, will have his/her position as a member of the Board declared null and void. If the Board member resigns, it will have decided through the GMS.

Principle 7 Strengthen corporate governance through stakeholder participation.

1.  The company should have a policy on preventing insider trading

Comply. The Company has a policy requiring that all transactions are reported to the Company.

2. The company should have anti-corruption and anti-fraud policies.

Comply. The policy is included in the Company’s Code of Conduct and all employees and suppliers sign an integrity pact stating their commitment to uphold the Code.

3.  The company should have a policy on vendor/supplier selection and improvement.

Comply. The Company selects vendors and suppliers based on its internal procurement policy, which is managed by the Procurement Division.

4.  The company should have a policy on fulfilling creditors’ rights.

Comply. The Company has a policy on fulfilling creditor’s rights. This is managed by the Finance Division, which organises and manages the payments due to creditors. These rights are also stated in the agreements, which are legally binding.

5. The company should have a whistleblowing policy.

Comply. The Company has a whistleblowing policy that has been described in the Corporate Governance Section of Company’s website.

6.  The company have a policy on giving long-term incentives to Directors and employees

Comply. The Company have a policy on giving long-term incentives to Directors and employees

Principle 8 Strengthen information disclosure

1.  The company should make use of a range of information technology (in addition to their websites) as a means of disclosing information.

Comply. Aside from using website and electronic reporting such as IDXNet and OJK Reporting, the Company also uses social media platform to disclose information about the Company.

2.  The company’s annual report should disclose the ultimate beneficial owners of shareholdings of 5% (five percent) or more of their shares, in addition to disclosing the ultimate beneficial owners of shareholdings in the company through the ultimate and controlling shareholders.

Comply. Company has disclosed the final beneficial owner of shares in the ownership of the Company at least 5% in Annual Report.