Procurement of GoodsServices SPECIFIC

1 70 70 The principles of procurement of goods and services used by the Company are as follows: 148 a. Efficient, means that the procurement of goods and services should be organised to get optimal and best results in a short time by consuming minimum fundings and capabilities in a reasonable manner and is not based solely on the lowest price; b. Effective, means that procurement of goods and services must comply with the specified requirements and deliver the maximum benefits in accordance with the targets set; c. Competitive, means that procurement of goods and services should be open for providers that meet the requirements and is done through a healthy competition among the Providers of Goods and Services that are equivalent and meet the certain requirementcriteria based on clear and transparent provisions and procedures; d. Transparent, means all provisions and information regarding the procurement of goods and services, including the administrative technical requirement of the procurement, the evaluation procedure, the evaluation results, determination of prospective providers of goods and services, is open for any interested participants; e. Fair and reasonable, means giving equal treatment for all potential qualified providers of goods and services; f. Accountable, means must reach the target and can be accounted for avoiding any potential misuse and irregularities. The Company policy in procurement of goodsservices a. The system of procurement of goods and services that is developed by the Company should; 1 Avoid any potential conflict of interest and affiliated transaction by all Insan SUCOFINDO in the system of procurement of goods and services. 2 Perform the process of procurement of goods and services through the appropriate and transparent mechanisms. b. Establish policies which support the process of procurement of goods and services that can be accounted for specifications in accordance with the needs, on time, competitive prices, administration in accordance with the prevailing requirement. 148 Regulation of the State Minister of SOE No. PER-15MBU2012 Article 2 1 C HA P T E R I IN T R O D U C T IO N C HA P T E R I I T H E PR IN C IPL ES O F G O O D C O R PO R A T E G O VER N A N C E C HA P T E R I I I T H E C O MP A N Y O R G A N S C HA P T E R I V T H E C O MP A N Y’ S PR IN C IP A L PO L IC Y C HA P T E R V I MA N A G EMEN T O F R EL A T IO N - SH IP W IT H ST A K EH O L D ER S C HA P T E R V I I IMPL EMEN T A T IO N O F G U ID EL IN ES C HA P T E R V I I I C L O SI N G C HA P T E R V MA N A G EMEN T O F SU B SI D IA R IES 71 71 c. Manage partner appropriately in order to acquire the counterparty that is professional, competitive and able to meet the Company’s needs on goods and services. d. Evaluate the performance of each of goodsservices providers on a regular basis and the evaluation result is used to update the data of goodsservices providers as well as be used as inputs for the next procurement of goodsservices process. e. Prioritize the use of domestic products, national design and engineering, as well as opportunity expansion for small businesses, provided that the quality, price, and purpose can be accounted for in accordance with the prevailing regulations. f. Provide preference of the use of domestic production with due regard to the prevailing legislation. g. Prioritize the synergy between State Owned Enterprises andor its Subsidiary provided that all the goodsservices are the production of State Owned Enterprises andor its Subsidiary concerned with quality, price, and purpose that can be accounted for and performed transparently.

15. Asset Management

The Company performs asset management based on the principles of highest and best utilization optimization on any assets highest and best uses with due regard to the prevailing legislation. By having this asset management, all information related assets can be acquired immediately and easily so that it will affect the decision making process especially in asset utilization and optimization. The Company policy in the asset management a. Have a work plan and a scheduled asset maintenance mechanisms to maintain the security, reliability and orderliness of the asset administration. High risk andor high value assets should be under insurance protection. b. Ensure each owned assets has the legal documents that demonstrate legitimate ownership of the assets. c. Perform asset identification and control of the document on the assets that are used by its own or used by other parties. d. Optimize or implement the process of non-earning asset disposal, which are in accordance with the Articles of Association and the prevailing legislations. 1 72 72

16. Document ManagementCompany Archive

Documentarchive management conducted by the Company is based on the principle of document retention and maintenance that is the most effective based on the value in use and the document retention period, thus providing easy access to obtain informationdata required and therefore will simplify the decision making process in the Company. The Company policy in the management of the Company’s documentsarchives a. Have a plan and mechanisms of maintenance of documentsarchive which include all documentsarchives of the Company, especially to safekeep the documentsarchives that are general, ordinary, important and confidential. b. Create a policy regarding the Company documentsarchives that can be destroyed based on the prevailing provisions and performed periodic re-assessment on the documentsarchives to analyse the value in use and retention period.

17. Information Disclosure of the Company

The Company requires the entire parties to disclose all information that is relevant, where openness is an important element of GCG and is a regular or periodic disclosure or disclosure based on a specific occurence and that cannot be anticipated. Therefore, the Company is obligated to take the initiative to disclose not only information in conformity with the legislation, but also information that are important for the decision making by shareholders, Creditors and other interested parties. The Company policy in performing the disclosure of information a. Disclose the information in accordance with the relevance and prevailing regulations in a timely and accurately manner. b. Maintain the confidentiality of the information including the use of electronic information by all Insan SUCOFINDO, partners or other parties, who are working forwith the Company during the term of employment or thereafter, in accordance with the prevailing legislation. c. Information that are not confidential can be published and accessible for the public through available means and facilities.