ANALYZING THE DECISION MAKING ON INVESTMENT IN PT ASURANSI JIWA BUMI ASIH JAYA USING GOOD CORPORATE GOVERNANCE AND SWOT APPROACHES

• Main Author: Priadi Hatoguan Sihombing (NIM 291 04 127), Rozald
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/6720
• Institution: Institut Teknologi Bandung

Abstract : <br /> <br /> <br /> <br /> <br /> Investment is one of primary activities in insurance industry. Any decisions related to investment in this industry would be considered as very strategic decisions, especially in facing the globalization era, as they would affect the competitiveness and existence of an insurance company. Further, Good Corporate Governance (GCG) is also a requirement for the corporate management quality, in global competition. <br /> <br /> <br /> <br /> <br /> In many companies in Indonesia, including PT Asuransi Jiwa Bumi Asih Jaya (Bumi Asih Jaya), GCG has yet to be implemented as one of their primary activities. Although, like in other companies in Indonesia, Bumi Asih Jaya also has to deal with some difficulties in implementing a good, objective and ethical management process. <br /> <br /> <br /> <br /> <br /> As a family-business-based company, ethnic- and family-based corporate culture of Bumi Asih Jaya affect negatively to the corporate governance. Hence, the implementation of main principles of GCG, i.e. transparency, independency, accountability, responsibility, and fairness, are expected to result in a distinctive management process in Bumi Asih Jaya. <br /> <br /> <br /> <br /> <br /> During the last decades, most of life insurance companies, including Bumi Asih Jaya, have been conventionally managed their investment in the form of property or fixed assets. However, since 1999, a step-by-step government deregulations in insurance sector have been implemented by issuing some laws regulations (Undang-undang, Peraturan Pemerintah, including Kepmenkeu) to regulate some basic requirements in insurance company, including liquidity ratio (Risk Based Capital - RBC), investment management control and minimum capital requirement. <br /> <br /> <br /> <br /> <br /> The recent laws and regulations require each insurance company to balance its investment by reducing its placement in fixed assets and balance the investment with some liquid investment, such as, fixed-account, obligation or stock portfolio. Further, each insurance company would be given a period of five years to attain the required level of liquidity ratio (RBC). <br /> <br /> <br /> <br /> <br /> Currently, the investment management in Bumi Asih Jaya has yet to be optimized to increase the investment outcome. In general, there are two basic problems in Bumi Asih Jaya. First, the company culture, which is almost as old as the company itself, would still need to be altered and modified to make it as one of the company strong points. Secondly, how to improve proper performance on future investment through smart and right to-the-point strategic, using all the potentials. <br /> <br /> <br /> <br /> <br /> Knowing all strengths and weaknesses as internal factors which affect the company performance, and recognizing all opportunities and threats as external factors are considered as two basic and important aspects in formulating future company strategy. Therefore, SWOT analysis is required to determine the future business process and investment activities in Bumi Asih Jaya. <br />