Implications of Overlapping Authority between the Ministry of State-Owned Enterprises and the Board of Commissioners on the Effectiveness of Performance Supervision of State-Owned Enterprises
DOI:
https://doi.org/10.38035/gijlss.v3i3.598Keywords:
State-Owned Enterprises, Board of Commissioners, Ministry of State-Owned Enterprises, Performance Monitoring, Good Corporate GovernanceAbstract
The overlapping authority between the Ministry of State-Owned Enterprises (SOEs) as the state shareholder and the Board of Commissioners as the supervisory organ of state-owned enterprises (PT BUMN) raises issues in the effectiveness of company performance supervision. By analyzing Law Number 1 of 2025 concerning the Third Amendment to Law Number 19 of 2003 concerning SOEs, Law Number 40 of 2007 concerning Limited Liability Companies, and implementing regulations related to Good Corporate Governance (GCG), this study seeks to analyze the legal and governance implications of this overlapping authority. Using a statutory and conceptual approach, the normative juridical method analyzes the laws governing the interaction between the Ministry of SOEs, the Board of Commissioners, and the Board of Directors. The results of the study indicate that the unclear division of authority in determining strategic policies and evaluating performance creates the risk of dual supervision, weak accountability, and potential conflicts of interest, thereby reducing the independence of the Board of Commissioners and hampering the implementation of the principles of transparency, accountability, and independence according to GCG guidelines. This study recommends strengthening legal norms through revisions to implementing regulations, affirming the limits of authority, and official coordination procedures between the Board of Commissioners and the Ministry of State-Owned Enterprises to improve public trust, support sustainable national economic performance, and monitor state-owned company performance more effectively.
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