World Bank2013-07-232013-07-232004-08https://hdl.handle.net/10986/14463In reforming its corporate governance, and in establishing a rule-based business culture, Indonesia faces many challenges. The key challenges are as follows. Enforcement of laws and regulations needs to be strengthened. Administrative sanctions for violation of securities or disclosure rules may not be adequate. Efforts should be expended to ensure that corporate officials in the position of trust are held accountable when they violate the law. Sanctions should go beyond fines, and the incentive system should be changed so that violators are truly discouraged, and good corporate behavior is promoted. This requires strengthening enforcement capacity of Bapepam for securities violations, and its independence as the securities regulator. The Company Law should explicitly refer to the fiduciary duties of directors and managers for violation of securities laws. Current efforts to amend the Company Law need to be expedited. Further efforts should also be expended to develop alternative (non-judiciary) mechanisms, such as shareholder activism, for encouraging compliance.en-USCC BY 3.0 IGOACCESS TO INFORMATIONACCOUNTABILITYADMINISTRATIVE SANCTIONSAPPLICABLE LAWSAUDIT COMMITTEESAUTHORITYAUTHORIZATIONBOARD MEMBERSBOARD OF DIRECTORSBOARDS OF DIRECTORSCAPITAL MARKETCAPITAL MARKET LAWCAPITAL MARKETSCASH FLOWCENTRAL BANKCHANGE OF OWNERSHIPCLASSES OF SHARESCOMMON SHARESCOMPANYCOMPANY LAWCONFLICT OF INTERESTCONFLICTS OF INTERESTCONGLOMERATESCORPORATE CONTROLCORPORATE CULTURECORPORATE GOVERNANCECORPORATIONCORPORATIONSCRIMINAL SANCTIONSDECISION-MAKINGDECISION-MAKING PROCESSDECREEDEGREE OF CONTROLDISCLOSUREDISCLOSURE REQUIREMENTSDISCLOSURE RULESDUE DILIGENCEECONOMIC CRISISENVIRONMENTAL ISSUESEQUITY MARKETSEXTERNAL AUDITORSFINANCIAL INSTITUTIONSFINANCIAL SITUATIONFINANCIAL STATEMENTSFIRMSFIXED INCOMEFOREIGN CURRENCYFOREIGN SHAREHOLDERSGOLDEN SHAREHUMAN RESOURCESINSIDER TRADINGINSTITUTIONAL FRAMEWORKINSTITUTIONAL INVESTORSINTEREST RATESINTERNAL AUDITINTERNATIONAL STANDARDSINVESTMENT BANKERSINVESTMENT CLIMATEJUDICIARYLABOR LAWLABOR UNIONSLAWYERSLEGAL DISPUTESLEGAL FRAMEWORKLEGAL OWNERLEGISLATIONLIMITED LIABILITYLIMITED LIABILITY COMPANYLISTED COMPANIESMANAGEMENT BOARDMERGERSMINISTRY OF FINANCEMINORITY SHAREHOLDERMINORITY SHAREHOLDERSNET PROFITNUMBER OF SHARESOWNERSHIP STRUCTUREPACIFIC REGIONPAID IN CAPITALPREEMPTIVE RIGHTSPREFERENTIAL RIGHTSPRIVATE SECTORPUBLIC COMPANIESPUBLIC COMPANYPUBLIC INFORMATIONPYRAMID STRUCTUREREGULATORY FRAMEWORKREPRESENTATIVESSANCTIONSSECURITIES FIRMSSEVERANCE PAYMENTSHARE OWNERSHIPSHAREHOLDER MEETINGSSHAREHOLDERSSHAREHOLDINGSTAKEHOLDERSSTATE-OWNED ENTERPRISESSTATEMENTSTATEMENTSSTOCK EXCHANGETAX AUTHORITIESTOTAL MARKET CAPITALIZATIONTRANSPARENCYVOTINGVOTING SHARESWorld Bank10.1596/14463