Supervision Strategy in Decision Making of Business Cooperation Contracts by Director of Regional Companies (BUMD) Through the Implementation of Legal Due Diligence (Legal Audit), Financial Due Diligence, and Feasibility Study

DOI

10.2991/assehr.k.211130.004How to use a DOI?

Keywords

BUMD; supervision; business cooperation contracts

Abstract

Commissioner is an organ of a limited liability company that is responsible for supervising and providing advice to the Board of Directors in carrying out the management activities of a Regional Owned Company (BUMD). Management and representation by the board of directors in running the company, one of which must be in accordance with the principles of Duty of care (prudential duty). The Board of Directors as a trustee with the principle of fiduciary duty must always prioritize prudence in running the company’s business, therefore every management action must always be carried out in good faith and full of responsibility. This paper will discuss the importance of the supervisory function of the commissioners in order to realize the professionalism of the duties of the directors by implementing three components of assessment that must be carried out by the directors before deciding to conduct transactions/business cooperation with third parties. As a legal paper, the juridical basis used to discuss is the laws and regulations concerning regional companies and limited liability companies in Indonesia. Supervision strategy through the implementation of Legal Due Diligence (Legal Audit), Financial Due Diligence, and Feasibility Study before conducting business cooperation is important to avoid the negligence of the board of directors in their duties.

Copyright

© 2021 The Authors. Published by Atlantis Press SARL.

Open Access

This is an open access article under the CC BY-NC license.

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TY  - CONF
AU  - Rina Yulianti
PY  - 2021
DA  - 2021/12/03
TI  - Supervision Strategy in Decision Making of Business Cooperation Contracts by Director of Regional Companies (BUMD) Through the Implementation of Legal Due Diligence (Legal Audit), Financial Due Diligence, and Feasibility Study
BT  - Proceedings of the International Joined Conference on Social Science (ICSS 2021)
PB  - Atlantis Press
SP  - 18
EP  - 22
SN  - 2352-5398
UR  - https://doi.org/10.2991/assehr.k.211130.004
DO  - 10.2991/assehr.k.211130.004
ID  - Yulianti2021
ER  -