The Urgency of Preventive Supervision to Prevent Corruption in Indonesian State-Owned Enterprises

Abstract

This study aims to present the urgency of preventive supervision based on good corporate governance (GCG) as a strategy for preventing corruption in Indonesian State-Owned Enterprises (SOEs). This research method uses a normative juridical approach, and the type of research carried out is a qualitative approach to produce descriptive data. Data collection techniques are carried out by collecting secondary data through library research, documents in the form of scientific contributions that have been published in research academic databases, and applicable laws and regulations. The dimension of the research problem starts from the fact that there is a lot of mismanagement in Indonesian state-owned companies, and they even go bankrupt. The findings of the research conclude that the strategy for preventing corruption in Indonesian SOEs must be supported by a corporate governance system consisting of governance structures, governance processes, and governance outcomes. In this context, the role of the board of commissioners is expected to be optimal to ensure and supervise the directors related to the corporate governance system in accordance with the principles of GCG in Indonesian SOEs. This has been regulated by several laws and regulations in force in Indonesia. Therefore, it is hoped that the credibility and effectiveness of Indonesian SOEs can be achieved, and have a positive impact on creating value for stakeholders, the economy, and people’s welfare. Thus, this study is interesting for companies and other stakeholders to improve the performance of the company in Indonesian SOEs through the creation of better business processes.