The implementation of Risk Management is an important pillar in realizing good corporate governance (GCG) and must be an integral part of the Company's management system. As part of the Company's commitment to effectively implement GCG, the Company's has formed a Risk Management Unit at the Sub-Directorate level which is directly responsible to the President Director.
Internal and external policies of Risk Management Implementation:
- Board of Directors Decree No.06/C/DU-KS/KPTS/ 2007 on Risk Management Implementation.
- Management System of Krakatau Steel (SMKS).
- SOE Minister Regulation No. PER-01/MBU/2011 on the Implementation of Good Corporate Governance for SOE, article 25.
- Head of the National Police of the Republic of Indonesia Regulation No.24 in 2007 about Security Management System
The Guidelines of Risk Management implementation in the Company:
- Guidelines on Implementing Risk Management.
- Corporate Risk Management Procedures
- Work Instruction of Risk Analysis and Control
- Work Instruction of Risk Monitoring and Reporting
Scope of implementation of the Company's Risk Management includes:
- Business Process Risk
- Project Risk (investment and routine development)
- Security Risk
Policies and Commitments Board of Directors in order to implement Risk Management in the Company are:
- Board of Directors and all employees of PT Krakatau Steel (Persero) Tbk are committed to conduct Risk Management effectively and consistently in order to ensure Continuity, Profitability and Growth in line with the Vision and Mission of the company
- To conduct Risk Management, the Board of Directors apply priority principles in controlling and evaluating also measuring risks to optimally allocate the company resources.
- The Board of Directors pay attention to strategic risk and establish mitigation measures as a consideration in decision making.
- The Board of Directors will continue to strive on developing a risk awareness culture through efforts to increase competence and foster awareness of each management and employee towards the implementation of risk management.
To support the reliability of risk management, the Company has developed a risk management Information System (SIMARIS) that is integrated throughout the Work Unit. SIMARIS began to be implemented in 2009 and continues to be developed until 2018. Information generated through SIMARIS will be used by the GCG & Risk Management Division to evaluate Work Unit Risks and create quarterly reports, and use the Internal Audit Unit to assist in the implementation of the audit process based on Risk Based Risk Audit as illustrated in the plot as follows: