Navigating Corporate Governance and Risk Management Requirements in the BUMN Omnibus Regulation

As discussed in our previous Client Alert, the Minister of State-Owned Enterprises (“Minister”) has issued the BUMN Omnibus Regulations at the end of March 2023, which consolidated and integrated over 45 ministry-level regulations. The BUMN Omnibus Regulations comprised of three ministry-level regulations:

1. Minister Regulation No. PER-1/MBU/01/2023 on Direct Appointments and Environmental Social Responsibility Programs of State-Owned Enterprises;
2. Minister Regulation No. PER-2/MBU/02/2023 on Guidelines for the Governance and Significant Corporate Activities of State-Owned Enterprises (“Regulation 2/2023”); and
3. Minister Regulation No. PER-3/MBU/03/2023 on State-Owned Enterprise Organisation and Human Resources.

This article will focus on Regulation 2/2023, which repealed and replaced 20 Minister Regulations on corporate governance of state-owned enterprises. Under Regulation 2/2023, the government detailed the provisions on good corporate governance, risk management, assessment of a state-owned enterprises’ health level, and goods and services procurement.