Risk Management Policy

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Corporate governance risk management is a process that is applied in determining corporate strategy designed to identify risks that affect the company's goals, and manage the risks so that they remain on the company's risk appetite as well as providing adequate assurance that corporate objectives can be achieved.

Risk management has been implemented in PT Pupuk Iskandar Muda since 2007 by establishing a Risk Management Implementation Team (TPMR) and Key Person for each work unit as an inseparable part of the implementation of Good Corporate Governance (GCG) in State Owned Companies (BUMN) in accordance with Decree of the Minister of State Owned Enterprises No. KEP-117/M-MBU/2002 dated August 1, 2002 and is also part of the Directors’ responsibility to the shareholders to meet the targeted Key Performance Indicator (KPI) specified in the contract management. As the company's organizational structure changed, the Department of Risk Management was established on June 1, 2011 as the risks managers in the company.

The company's commitments towards the implementation of Risk Management are:

  1. To detect/identify risks as early as possible in any activity related to the duties, authorities and responsibilities.
  2. To measure risks by calculating the amount of impact and likelihood of the risk odds.
  3. To evaluate the sources and causes of the risks, as a basis to map and control the significant risks.
  4. To manage sustainable control strategies against the risks with high priority / significant risks for the sake of company’s survival.
  5. To conduct ongoing monitoring of risks, especially those that have significant impact on the company's condition.
  6. To report the results of the identification, monitoring and follow-up risk control periodically for each quarter, semester and yearly.
  7. To set risk management as the basis of the examination (risk-based audit) and as a Key Performance Indicator (KPI) for each Head of Work Unit.

The cycle of risk management at PT Pupuk Iskandar Muda consists of Risk Identification, Risk Measurement, Risk Control and Risk Monitoring.

Risk management is applied within the 12 functions of the company activities, namely Production, Marketing, Finance, Procurement, Distribution, Development, Information Technology, Internal Control, Human Resources, General, Law and Environment, Occupational Safety, Fostering Cooperatives and Community Development.