Reputation Risk Laporan Tahunan 2016 PT Bank Mandiri (Persero) Tbk versi B.Inggris

10 Consolidated Financial Statements 09 Cross Reference of Annual Report Award 2016 Criteria 08 Corporate Social Responsibility 07 Integrated Corporate Governance 06 Corporate Governance

6. Reputation Risk

Reputation risk is the risk faced by the Bank as an impact of the negative perception of stakeholders to the Bank which coming from various undesirable events such as negative publications over the Banks operations, violation of business ethics, customer complaints, governance weaknesses and other events that can degrade the image of the Bank. Reputation Risk Management Organization The reputation risk is managed by the Corporate Secretary Group and performed by all working units within the company, including Customer Care Group, Strategic Marketing Group, and IT Strategy and Infrastructure Group. In its function, Corporate Secretary Group is responsible to the Board of Directors and came under the direct supervision of President Director. Thus, in addition to the President Director, Corporate Secretary Group also provides report to the associate director whom related with the incidence of reputation. Reputation Risk Management Mechanism Reputational risk is managed through the mechanism of oversight, handling and settlement which coordinated by the Corporate Secretary Group by referring to the provisions of Standard Guidelines for Corporate Secretary. Implementation of Reputation Risk Management Policy As the implementation of reputation risk management policies, the President Director assures that all working units have been performing the function of each well and according to the applicable regulations. In case there is potential events affected the reputation risk related to the duties and functions of particular working unit, so the working unit is obliged to provide detailed information to the Corporate Secretary Group in order to manage the incident so as to minimize the impact. Currently, Bank Mandiri has an official channel to receive complaints and questions from customers, such as call center 14000, website, branches, including conventional media and social media. All complaints are forwarded to Customer Care Group to get the handling and settlement. On these duties, Customer Care Group collaborates with the Corporate Secretary Group, particularly in handling customer complaints related with conventional media and social media. Separately, Corporate Secretary Group also monitors and evaluates of various reports and then releases them in conventional media and social media periodically to measure the effectiveness of the companys publication and communication activities. Furthermore, monitoring and evaluation results will serve as the basis of publications and communication activities for the next period in order to strengthen the companys reputation on an ongoing basis. In its function as the coordinator of managing reputation risk of the Company, Bank Mandiri also have several internal units, such as the Corporate Communication Department and Corporate Social Responsibility CSR Department which has the authority and ability to create a positive image of the company through communication programs and social activities of the company. Whereas in the context of crisis or incident reputation highly critical and massive so it affects the confidence of stakeholders or shareholders, Corporate Secretary Group assumes full responsibility for implementing the action plan which is expected could minimize the impact of the crisis, among others preparing the strategy of problem management, determining the internal sources and executing schedule of crisis management activities, as well as the overall evaluation.

7. Strategic Risk