USo AR TELKOM 2015 ENG.1

176 PT Telkom Indonesia Persero Tbk The Joint Decree regulates that license for telecommunication tower construction is to be issued by regents or mayors, and for Jakarta Province, its Governor. The Joint Decree also provides for tower construction standards and requires that telecommunications towers be made generally available for shared use by telecommunications service providers. The owner of a telecommunications tower is allowed to collect a fee, which is negotiated with reference to costs associated with investment and operational costs, the return of investment and a proit. Monopolistic practices in the ownership and management of telecommunications towers is prohibited.

16. Content provider Service

Content provider service is regulated by the Ministry of Communication and Information through Regulation No.212013 on the Management of Content Provider Services on Celullar Mobile Networks and Wireless Local Static Networks with Limited Mobility, as ammended by the Ministry of Communication and Information Regulation No.62015 of February 6, 2015. fUnCtional overvieW HUMan Capital Develop great leader, great people, and great Culture Directorate of Human Capital Management HCM Telkom has a great responsibility to continue to support the achievement of business objectives of Telkom Group in order to position the Company as one of the largest telecommunications companies in Indonesia. Directorate of HCM supports our business through the implementation of a competency-based human resource development strategy that is applied to manpower planning, the process of selection and recruitment, learning and development, performance management and career development programs, as well as compensation and beneits scheme. To ensure that all employees have the appropriate competence respective ield and always maintain good quality in an efort to realize the Company’s vision, which is Be The King of Digital, the Company has developed a competency development program that applies to all employees of Telkom Group. The program in question include a certification program and global talent program. Both of these programs are running in line with efforts to welcome the ASEAN Economic Community AEC which starts from the end of 2015. We believe that human resources are the most important asset of the Company, and therefore we have a strong commitment to developing the potential of our employees. Employee development is done through appropriate training methods to empower and improve their skills and expertise. Our competence development programs include aspects of business and organizations, and includes product knowledge, control and compliance, related to the efectiveness of individual self-development, functional competence, leadership and character development of employees. As such, we are committed to continue to develop the competencies and capabilities of all employees; to always nurture good labor relations with employees; and to create the interactive engagement among employees. In addition, the Company also expects that every employee is fully responsible for their self-development, and is committed to generating superior performance in order to realize a professional corporate culture and global standards. The Company has developed a Human Capital Master Plan to ensure the best management of Human Capital, in order to support the implementation of corporate business strategy. Preparation of Human Capital Master Plan was developed with reference to the long-term corporate planning and annual plans and business strategies of each company incorporated in the Telkom Group. Preparation of Human Capital Master Plan also refers to an internal analysis and current issues related to Human Capital happens to the world’s leading companies. Related to human resource management, we are committed to run the entire Human Capital program that have been developed to relect the essence of the program clearly Get The Essence; must be carried out efectively and eiciently Efective and Eicient; and using a personal approach or per individual employee Personalized Approach. The principles of human resource management is relected in our Human Capital Master Plan, which is divided into: • Strategic initiatives of Human Capital for a period of ive years in the future; • Key programs as the elaboration of a strategic initiative of Human Capital; • Strategic guidelines for each manager of Human Capital in the Telkom Group; and • Strategic planning of workforce within the next ive years, which contains the annual HR plan in each company Telkom Group, including the projections of the amount of human capital and employee productivity levels to be achieved within the next ive years. Preparation of Human Capital Master Plan of Telkom Group in an integrated manner will also assist the Company in managing human capital as a whole, on target, and ensure the realization of the role of Human Capital as a corporate strategic partner in order to achieve business goals that have been set. 177 PT Telkom Indonesia Persero Tbk Number of Employee proile Employee numbers as of December 31, Telkom Subsidiaries Telkom Group 2015 16,097 8,688 24,785 2014 17,279 8,005 25,284 2013 17,881 7,130 25,011 Proile of Telkom Group employees based on the position was changed. In 2015, the number of employees at senior management level amounted to 608 employees, increased from 2014 which to amounted 541 employees. Number of employees in middle management positions amounted to 4,651 employees in 2015, increased from 4,181 employees in 2014. Meanwhile decrease in the number of employees based on position occurs at the level of supervisors amounted 13,017 employees in 2015, of 13,077 employees in 2014 and the number of employees in other positions, decrease to 6,509 employees in 2015 from 7,485 employees in 2014. Employee proile by position Position 2015 Telkom Subsidiaries Telkom Group Senior Management 187 421 608 2.5 Middle Management 3,281 1,370 4,651 18.8 Supervisor 9,913 3,104 13,017 52.5 Others 2,716 3,793 6,509 26.3 Total 16,097 8,688 24,785 100 Position Position 2014 Telkom Subsidiaries Telkom Group Senior Management 151 390 541 2.2 Middle Management 2,939 1,242 4,181 16.5 Supervisor 10,233 2,844 13,077 51.7 Others 3,956 3,529 7,485 29.6 Total 17,279 8,005 25,284 100 In 2015, the composition of our employees by education level was dominated by university graduate amounted to 12,182 employees, while we had 5,248 pre-university employees, 4,855 diploma graduate employees, and 2,500 post- graduate employees. To meet the human resource needs of the business units, we have always relied on the principle of synergy and optimization of internal resources available in Telkom Group. In addition, we strive to ofset the number of employees with HR competencies to keep pace with growing business portfolio to focus on Digital TIMES business. We also strive to improve the synergy and eiciency to all subsidiaries of Telkom Group, and continue to infuse the application of the Company’s core values that have been set. optimalize resources, Creating value added By 2015 the total number of employees of Telkom Group are 24,785 employees, consisting of 16,097 Telkom employees and 8,688 employees of its subsidiaries. Telkom’s number of employees decreased by 6.8 compared to position at December 31, 2014 amounted to 17,279 employees, in line with the continuation of multi-exit program as part of eforts to revitalize and increase the eiciency of human resources has been running since 2002.