ENDEAVORS TO PROMOTE GOVERNANCE QUALITY IN INDONESIA

Implementation of Good Governance in Indonesia needed acceleration because data of good Governance Indicator of the World Bank showed that Good Governance index in Indonesia was still low, today at 37^th position of maximum 100. Meanwhile International Transparence Data [TI] based on the assessment source showed that Corruption Perception Index [IPK] Indonesia 20-13 was at 114^th position among 177 countries.

Under the circumstances it came as no surprise that financial institutions in Indonesia were places where fraid was happening as disclosed by he Global Fund Survey 2014. “Therefore the awareness to implement Good Governance effectively in the financially service and constantly and the initiative must show sound benefit, instead of mere rules and regulations.”

Furthermore Mulliaman stated that the development of institutional capital, which was in principle a form of good governance in Indonesia must be constantly improved and perfectionized.

Good Governance, Muliaman said, was a necessity not just a concept. Good Governance as a concept had been widely known and discussed by professional circles but the implementation and benefit was still way below people’s expectation. There was significant gap between the application of Good Governance and public expectation of the benefits. Therefore there must be sound initiative between to bring the concept down-to-earth so it could be well understood, implemented, and be felt it its benefits.

In this case OJK was determined to be role model of Good Governance implementation in Indonesia, especially in the financial service industry. The strategic steps taken were among others:

1. To interpreted and implement the principles of Good Governance as message of the OJK Law into all organization policy.
2. To apply organizational policy which had check and balances.
3. To set up which functionally run Good Governance, Risk Management, Quality Assurance and compliance of Good Governance through signing of the Integrity Pact.
4. To set up employees’ Code Ethic and discipline to make sure that all activities were withinthe corridors of Good Governance through signing of the Integrity Pact.
5. To make it mandatory for all officials to report their asset through LKHPN to KPK.
6. Strengthening of control mechanism of the Board of Audit and to ensure functioning of Ethics Committee as message of the OJK Law.
7. To set of standers operating procedures (SOPs) are developed based on the principles of governance as a reference for the mechanism of action at the OJK.
8. To stipulate policy and the mechanism of whistle blowing system [WBS] for early warning channels, to underscore the right and responsibility of all staff to be clean and work professionally involving public participation and to create preventive effect.
9. To apply the mechanism of rule making rule for regulating process involving the public and be transparent.
10. To execute educational strategy and consumer’s protection among others through educational program, and to build consumers service centers for complaints. To realize good governance in the industry through strategic regulating, controlling, education and partnership with stakeholders.

In building a healthy and stable industry, OJK ran management strategy, control and consumer’s education but also applied partnership strategy with professionals and other stakeholders. OJK kept communicating intensively qit association and professionals in the government good government in the financial industry.

Today OJK together with associations were scheming Model of Governance and combined Assurance OJK. The objective was to use the model as reference for future applications. the same was with Model combined Assurance as reference in developing assurance in internal OJK to make sure that good government runs effectively.

The definition of Good Governance and combined assurance of OJK which involved players of service industry and finance was one of OJK’s strategy to promote governance quality in the financial service industry beside the management and control approach. An approach as such was holistic approach which emphasized more on need and benefit instead of the approach focusing on suty and sanction. (SS)

Business News - November 21, 2014