SR-Telkom 2013 English Final Lowres PDF

Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index
2013 Sustainability Report

PT Telekomunikasi Indonesia, Tbk
Creating Sustainable
Global Talents and
Opportunities

2013 Sustainability
Performance
Overview
About Telkom
About
This Report
Economic
Growth
G4-31
DISCLAIMER
Several parts of this Sustainability Report include forward-looking statements, including our expectations and projections
related to future sustainability performance. These statements generally make use of words such as commitment,
believe, expect, anticipate, estimate, project or other similar words. In addition, all statements other than historical
facts included in this sustainability report can be categorized as forward-looking statements. Although we believe that the
expectations reflected in the forward-looking statements are reasonable, we can give no assurances that such expectations
will prove to be correct. Statements that are forward looking are subject to risks and uncertainties, including changes in the
economic, political and social environments in Indonesia.
PERSONAL CONTACT (3.4)
For further information regarding this Report, please contact
Investor Relations, Grha Merah Putih 5th Floor, Jl. Jend. Gatot Subroto Kav. 52, Jakarta 12710, Indonesia. Tel: (62-21) 521 5109,
Fax: (62-21) 522 0500 or email: investor@telkom.co.id. You can also download this document from our website
http://www.telkom.co.id.
Telkom Shares
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

Creating Sustainable Global

Talents and Opportunities
International expansion has resulted in
Telkom now standing alongside worldclass companies and ensures sustainable
future growth.
As a company strongly committed
to maintaining balanced high-quality
growth, Telkom has implemented various
educational programs to facilitate the
whole of Indonesian society, including
business corporations, SME and micro
enterprises, to take part in the global
market with the support of world-class
TIMES services and to operate more
efficiently and in an environmentally
friendly manner.
2013 Sustainability
Performance
Overview
About Telkom
About
This Report
Economic
Growth
Telkom Shares
Contents

2013 Sustainability Performance

Overview
Report from the President Director
About Telkom
Products and Services
24
Company Scale
27
Relationship with Suppliers

(Supply Chain)
27
Significant Changes
28
Mitigation Principle
Approaches
28
Commitment to External
Initiatives
29
Industry Association
and Other Organization
Memberships
29
Operational Structure and

Share Ownership
29
About This Report
Determining Materiality Level
34
Report Boundary
35
Supply Chain
35
Determining Material and

Boundary Aspects
36
Materiality and Boundary

Aspects
36
Relations with Stakeholders
37
Significant Changes from the

Previous Years Report
37
Personal Contact
37
Community Economic
Empowerment
44
Development Partner
Success Stories
46
Telkom Shares
Corporate Social
Responsibility Development
Strategy
50
Community Empowerment
Program
51
Community Development
Program
51
Economic Growth
Supporting Indonesias
Economic Growth
40
Development Strategy
40
Supporting Improved
Economic Conditions for
Stakeholders
Telkom Preserves the Environment

Environmental Impact of
Telkoms Activities
62
41
Implications, Risks and

Business Opportunities
Related to Climate Change
62
Contribution to State
Revenue
42
Participation in
Environmental Conservation
63
Fostering a Healthy and

Environmentally Friendly
Culture
66
Supporting Environmentally
Friendly Economic Activities
66
Report Content
Determination Process
33
Supporting Regional
Economic Growth
43
Report Content
Determination Process
Flow Chart
33
Fostering Good
Relationships with Partners
43
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Participation in Greening
Activities
67
Environmental Costs and

Awards
67
Telkoms People
Developing Employee
Competencies and Careers
70
Benefits
74
Occupational Health, Safety

and Environment (HSE)
76
Industrial Relations
78
IT-based HR Service System
80
Culture Transformation
81
Employee Profile
82
Awards
83
Prioritizing
Customers
GRI G4
Core Index

Telkom Governance
GCG Framework and
Performance
86
Governance Strengthening
Roadmap and Initiatives
86
Company Governance
Structure
88
Code of Ethics and

Corporate Culture
Whistleblowing System
Fulfilling Customer Needs

and Improving Customer
Satisfaction
104
Marketing Strategy and

Customer Privacy
107
Marketing Communication
108
Improving Service Quality
109
91
Handling Customer
Complaints
110
94
Customer Satisfaction
Surveys
111
Consumer Protection
111
Prioritizing Customers
The Future of Indonesias
Telecommunication Industry
102
Universal Service Obligations

and Competition
103
GRI G4 Core Index

Glossary

2013 Sustainability
Performance
Overview
About
This Report
About Telkom
Economic
Growth
Sustainability Performance
Overview
Economic Performance Overview
Economic Value Generated

(Rp billions)
71,900
77,882
Economic Value Distributed

(Rp billions)
84,322
60,298
57,640
49,796
2011
2012
2013
Retained Economic Value

(Rp billions)
2011
2013
Contribution to State Revenue

(Rp billions)
26,682
14,780
22,104
2012
15,874
16,742
17,584
2011
2012
2013
2011
2012
2013
Telkom Shares
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
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Community Empowerment
Total
Community
Development
Disbursement
Rp
Total Soft Loan

Disbursement
Rp
Total
Development
Partners
Training
Costs for
Development
Partners
55.8
billion
(including administrative costs)
118.2
3,975
Rp
2.9
billion
partners
billion

2013 Sustainability
Performance
Overview
About Telkom
About
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Telkom Shares
Environmental Performance
Highlights
Programs
Conserved energy at
3,996 outdoor BTS and utilized
renewable energy sources for BTS in remote areas.

Energy efficiencies in office buildings by:
Use of capacitor banks to improve power factors.

Use of reflective glass.
Replacing conventional light bulbs with LED bulbs.
Applying building automation for cooling systems.
Applying lighting zoning schemes.
Installing timers for outdoor lighting.
Implementation of a paperless office for online office

applications, resulting in reduced paper use of at least

7,966 reams per year.
Promotion of a healthy and environmentally friendly culture

through the
Bike to Work and Earth Hour programs.
Recycling water for outdoor requirements and to water plants.
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
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Results and Program Realization

Reduced CO2 emissions of at least
961.39 tons carbon equivalent.

Beach cleaning at Pulau Pramuka
in Kepulauan Seribu, to reduce the
environmental impact of 100 tons of trash
per day from Jakarta.
Creation of a Green Belt to minimize

coastal abrasion in Indramayu.
Planting
15,000 mangrove seedlings
in Kampung Garapan, Tangerang.

Planting trees / regreening in Bandar

Lampung, Makassar.

2013 Sustainability
Performance
Overview
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Telkom Shares
Social Performance Highlights

Building Social Welfare
Fund disbursement for Community Development Program
Education and Training

(Rp billion)
19.96
Religious Facilities
(Rp billion)
20.96
13.28
14.77
6.50
2011
2012
2013
Public Facilities
2011
2012
2013
Victims of Natural Disaster
(Rp billion)
(Rp billion)
6.19
1.41
5.54
5.28
7.21
1.47
0.49
2011
2012
2013
Community Health
2011
2012
2013
Environmental Conservation
(Rp billion)
(Rp billion)
2.44
7.80
5.37
4.65
0.96
0.50
2011
2012
2013
2011
2012
2013
Telkom Preserves
the Environment
Telkoms
People
Telkom
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New Program: Poverty Alleviation with Funding of Rp6.63 billion

Programs
Dedicated to My Teacher program conducted in six cities; participants were
Junior and Senior High School teachers.
Internet Education in disadvantaged villages in Banten and West Java.
Bandung Knowledge Cloud in cooperation with the Institute for Innovation
and Entrepreneurship Development (LPIK) ITB.
Integrated Digital School Applying DNA (device-network-application)
technology for school communities, reaching 25 schools in Central Java,
Yogyakarta, East Java and Bali.
Edu Campus Development Center (ECDC) program A program to equip
undergraduate students with knowledge of Microsoft application software.
Indonesia Digital School (IndiSchool) A program to install Wi-Fi
equipment in 100,000 schools across Indonesia to Develop a Smart
Indonesia.
Assistance to Increase Public Religious Activities and Facilities

Building Islamic boarding schools and mosques in various areas, as well as
assistance to construct church buildings in Toraja, Papua, Simalungun and Toba
Samosir.
Assistance Developing Public Facilities and Infrastructure

Broadband Learning Center (BLC) assisting with internet access in remote

areas.
Independent Community Electricity (Listrik Mandiri Rakyat) Program
installing pico-powered village-based electricity generation installations in
two villages in East Java.
Establishment of Taman Bungkul a public park with Free Wi-Fi facilities.
Assistance to Victims of Natural Disaster

Donations for disaster and post-disaster relief related to Mt. Sinabung, flooding
in various areas and the Aceh earthquake.
10

2013 Sustainability
Performance
Overview
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Kaleidoscope
1856-1882
On 23 October 1856, the Dutch-East

Indies colonial government operated
the first electromagnetic telegraph
service in Indonesia, connecting
Batavia (Jakarta) and Buitenzorg
(Bogor).
1974
PN Telekomunikasi was divided

into two divisions, PT Industri
Telekomunikasi Indonesia (PT INTI),
which produced telecommunication
equipment, and Perusahaan Umum
Telekomunikasi (PERUMTEL), which
provided domestic and international
telecommunication services.
1906-1965
The colonial government formed

a state agency to control postal
and telecommunication services in
Indonesia. In 1965 the Postal and
Telecommunication Services were
separated into two state-owned
enterprises, PN Pos and Giro and
PN Telekomunikasi, which managed
these services.
1980
The international telecommunication

service was taken over by
PT Indonesian Satellite Corporation
(Indosat).
1991
Perumtel became PT Telekomunikasi

Indonesia, or Telkom, with its
business operations split into
twelve telecommunication areas
(Witel). These twelve Witel were
then reorganized into seven regional
divisions (DIVRE), namely
Division I Sumatera, Division II
Jakarta and its surrounding area,
Division III West Java, Division IV
Central Java and DI Yogyakarta,
Division V East Java, Division VI
Kalimantan and Division VII Eastern
Indonesia.
1995
Telkom implemented its Initial

Public Offering on 14 November
1995 on the Jakarta and Surabaya
Stock exchanges. On 26 May 1995,
Telkom established a subsidiary,
Telkomsel, to handle the cellular
telecommunications business.
1999
The Telecommunications Law (Law

No. 36/1999) came into effect in
September 2000 and facilitated
the entry of new players into the
telecommunications industry to
stimulate a competitive business
environment.
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
2001
Telkom acquired 35% of Indosats

shares in Telkomsel, thus becoming
a majority shareholder in the cellular
company with 77.7% shares. Indosat,
meanwhile, took over 22.5% of
Telkoms shares in Satelindo and
37.7% of Telkoms shares in
PT Aplikanusa Lintasarta. At the
same time, Telkom lost its right to be
sole provider of fixed line telephony
services in Indonesia.
2002
Telkom released 12.7% of its shares

in Telkomsel to Singapore Telecom
Mobile Pte Ltd (SingTel Mobile).
2004
Telkom launched international direct

dialing for fixed line telephones.
2005
The Telkom-2 satellite was launched

to take over all satellite transmission
services previously handled by
Palapa B-4 satellite. This launch
made it the eighth satellite launched
by Telkom, including Palapa A-1.
Prioritizing
Customers
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2009
Telkom transformed from an

infocomm company to a provider
of Telecommunication, Information,
Media & Edutainment (TIME).
Telkoms new look was introduced to
the public with a new logo and a new
tagline: the world in your hand.
2010
The JaKaLaDeMa submarine fiberoptic cable project connecting Java,

Kalimantan, Sulawesi, Denpasar and
Mataram was successfully completed
in April 2010.
2011
Telecommunication infrastructure
reformation commenced with the
Telkom Nusantara Super Highway
project, to connect the archipelago
from Sumatra to Papua, and the
True Broadband Access project,
which provides internet access with
a capacity of 20-100 Mbps to all
customers across Indonesia.

11
2012
Telkom increased broadband

penetration with the construction
of Indonesia Wi-Fi to realize the
Indonesia Digital Network (IDN).
The business portfolio changed from
TIME to TIMES (Telecommunication,
Information, Media, Edutainment &
Services) to improve business value
creation.
Telkom Corporate University was
established to develop human
resources able to compete in the
international business world (from
competence to commerce).
2013
Telkom now operates
in seven countries:
Hong Kong-Macau,
Timor Leste,
Australia, Myanmar,
Malaysia, Taiwan and
the United States of
America.
12

2013 Sustainability
Performance
Overview
About Telkom
with our Vision,

and
Values...
About
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Economic
Growth
Telkom Shares
Mission
VISION
To become a leading
Telecommunication, Information, Media,
Edutainment and Services (TIMES)
player in the region.
MISSION
Provide more for less TIMES services.

Be the role model for best managed
Indonesian corporation.
Corporate Culture
The New Telkom Way
Philosophy to be
the best
Always The Best
Principle to be the
star
Solid, Speed, Smart
Practice to be the
winner
Imagine, Focus, Action
Our Vision and Mission are recorded in the companys long-term plan and were approved by the Board of
Commissioners on 30 May 2013 in the Board of Commissioners Decree No. 06/KEP/DK/2013/RHS.
Telkom Preserves
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Telkoms
People
Telkom
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..as well as our Strategic
Initiatives...
1
Centre of Excellence.
Focus on portfolios with high growth or value.
Accelerated international expansion.
Transformation costs.
IDN development (id-Access, id-Ring, id-Con).
Indonesia Digital Solution (IDS) convergence service

for digital ecosystem solutions.
Indonesia Digital Platform (IDP) platform enabler for

ecosystem development.
Best subsidiary management system execution.
Portfolio management through BoE and CRO.
10
Improving synergy within Telkom Group.
Strategic initiatives are determined based on the decision of the PT Telekomunikasi, Tbk, Indonesia Board of
Commissioners, Decree No.06/KEP/DK/2013/RHS dated 30 May 2013.
13
14

2013 Sustainability
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Overview
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Telkom Shares
Significant Events
27 JunE 2013
11 JulY 2013
21 AUGUST2013
4 September 2013
FebruarY
Launch of Contact Center 110

Telkom launched Contact Center
110 (free to call) in synergy with the
Indonesian National Police to report
accidents and criminal acts.
8 JUNE 2013
Telkom demonstrated its care for the

environment through a series of Go
Green Smile programs, encompassing:
Beach cleanup on Pramuka Island,
Thousand Islands. Planting 15,000
mangrove seedlings in Kampung
Garapan, Desa Tanjung Pasir,
Tangerang. Creation of a Green
Belt to minimize coastal abrasion in
Indramayu.
Greening project in Bandar Lampung,
Makassar, Bengawan Solo riverbanks,
Jember and Madura. Establishment of
biopore holes in Bogor and Bandung.
27 JUNE 2013
Telkom Indi School Wi-Fi Launching

at SMPN I Sabang
As part of its participation in creating
a digital society and ensuring national
integrity, Telkom implemented its
Launching Wi-Fi at SMP Negeri I Kota
Sabang, as part of the The World in
Your Hand with high quality internet
access from Telkom program, part of
the Broadband Learning Center (BLC)
activities.
11 JULY 2013
SME IndiPreneur Training in

Yogyakarta
Telkom Yogyakarta held IndiPreneur
training titled Pelatihan Portal
Community Sentra UKM Merah
Putih (Red & White SME Center
Portal Community Training) involving
business people from SME centers
across Yogyakarta. The IndiPreneur
series of programs is aimed at
encouraging SMEs to go online to
boost promotions and increase
transaction turnover.
21 AUGUST 2013
Jogya Digital Valley

To stimulate the digital creative
industry in Indonesia, specifically in
Yogyakarta, Telkom built the Jogja
Digital Valley (JDV), an incubator
and business accelerator center
for Information & Communication
Technology (ICT) businesses,
following the establishment of a
similar facility, namely Bandung
Digital Valley (BDV).
23 AUGUST 2013
Signing of CLA V
The management and SEKAR
successfully reached agreement
for the signing of CLA V, valid
from 23 August 2013 to 23 August
2015, based on Law No. 13/2003
regarding Manpower, as well as
Ministerial Decree of the Minister
of Manpower and Transmigration
No. PER.16/MEN/XI/2011 regarding
Procedures for the Preparation and
Legalization of Company Regulations
and Registration of Collective Labor
Agreements (CLA)
4 SEPTEMBER 2013
National Customer Day

To celebrate National Customer Day
(HPN), Telkom held a One Day Service
for New Installations, Customer
Disturbances, Transfers and Claims
at Plasa Jatinegara and Plasa Gatot
Subroto.
NOVEMBER 2013
Assessment Center Indonesia

Telkoms Assessment Center Indonesia
(ACI) was inaugurated by State SOE
Minister Dahlan Iskan. The center is
Telkoms contribution to developing
Indonesias human resources.
Telkom Preserves
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15
Awards
Speedy was awarded best Internet

Service Provider (ISP) in Indonesia
2012 by Chip Magazine in the 2013
Chip Award.
Awarded The Best Product

Innovation of Infrastructure
Sector for IndiFinance, The Best
Technology for Indigo and The
Best Corporate Innovation Culture
& Management in the 2013 SOE
Innovation Award by the SOE Ministry.
Awarded Best of Asia in Asias

icon on Corporate Governance in the
Corporate Governance Asia Annual
Recognition Award 2013 by Corporate
Governance Asia Magazine.
Awarded Best Sustainability

Reporting Award 2012 in the industry
category of the Sustainability
Reporting Award (SRA) from the
National Center for Sustainability
Reporting (NCSR).
Awarded Diamond in Cellular

Telecommunication CDMA category
for Plasa Telkom in the Service Quality
Award 2013 by Service Excellence
Magazine.
Awarded Excellent Service Performance

for the Telkom Contact Center in the
Contact Center Service Excellence Award
2013 held by Care Center for Customer
Satisfaction and Loyalty.
Awarded Asian Town Scapes Sector Award 2013

for Bungkul Park, an annual award made by Asian
Townscape Award (ATA). Bungkul Park was renovated
with funding from the Community Development
Program, and is also known by the name Taman Telkom.
National Social Solidarity Award (KSN) Expo & Awards

2013 from the Coordinating Minister for Social Welfare
for Telkoms Active Role in activities directly related to
poverty alleviation.
16

2013 Sustainability
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Certification
ISO 9001:2008 Certification

Awarded to PT Finnet by DQS GmbH
in 2012. Valid until 2015.
Customer Center of Expertise

Certification
Awarded by SAP in 2012. Valid until
2013.
AS/NZS ISO 9001:2008 Certification

Awarded to PT Administrasi Medika
(AdMedika), one of Telkoms
indirect subsidiaries, by Verification
New Zealand Limited in 2012. Valid
until 2015.

Awarded to PT Dayamitra
Telekomunikasi (Mitratel), a
Telkom subsidiary, by United
Register for System (URS) in
2013. Valid until 2016.
ISO/IEC 27001:2005 Certification

Awarded to PT Finnet, one of
Telkoms indirect subsidiaries, by
DQS Gmbh in 2012. Valid until 2015.

Awarded to Consumer Service West
Division by TUV Rheinland Cert
GmbH in 2011. Valid until 2013.
Telkom Preserves
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Awarded to Business Service Division
by TUV Rheinland Cert GmbH in
2013. Valid until 2016.
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Awarded to Telkom Flexi Division by
TUV Rheinland Cert GmbH in 2011.
Valid until 2014.
ISO/IEC 27001:2005 Certification

Awarded to Infratel Division M Floor
and Access Division 7th Floor of
Gedung Grha Citra Caraka, by TUV
Rheinland Japan Ltd. in 2012. Valid
until 2015.

17

Awarded to PT Telkom Akses, a
Telkom subsidiary, by TUV Rheinland
Cert GmbH in 2013. Valid until 2016.

Awarded to Enterprise Service
Division by TUV Rheinland Cert
GmbH in 2011. Valid until 2014.
18

2013 Sustainability
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19
Telkom continues to actively participate in the mitigation

of carbon dioxide impact through the Telkom Go Green
Action program and to stimulate environmentally friendly
business activities through the provision of worldclass telecommunication service content and IT-based
transmission content.
Message from the

President Director
Arief Yahya
President Director
20

2013 Sustainability
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The widespread extent of the
operational activities. Telkom
natural gas), in accordance with
environmental crisis facing the
also demonstrates real efforts
international standards for new
Earth is demonstrated by the
to stimulate an environmentally
room coolers (air conditioners). We
increasingly intense extreme
friendly economy, growth and
are also making efforts to reduce
weather that has hit various
business development through
indirect emissions of CO2 gas by
parts of the globe, not excluding
improved performance in TIMES
the efficient use of mains electricity
Indonesia. The joint efforts
services that facilitate more reliable
for AC and lighting, including
promoted by leaders of the worlds
communication, data transfer
more energy efficient STOs, using
major industrial nations to mitigate
and teleconference activities.
buildings designed especially
the effects of CO2 (carbon dioxide)
Nowadays, business management
to save electricity, and taking
emissions are still facing a variety
activities can be more efficient
other steps to reduce the use of
of challenges. The main obstacle is
with substantially reduced physical
electricity generated by power
differing economic interests, which
movement, thus reducing CO2
stations.
has resulted in no agreement yet
emissions from transportation.

In addition, we continue to apply
being reached on the joint global
the paperless office concept and
framework.
INCREASING THE INTENSITY

OF ENVIRONMENTALLY
FRIENDLY OPERATIONS
Despite this reality, Indonesia,
We continue to maintain a high
By improving the quality of
as a country with vast tropical
level of consistency in applying
such service applications, we
rain forests, is one of the main
environmentally friendly operations
fully support the growth and
components in the process of
as part of our Telkom Go Green
development of more efficient
mitigating CO2 gas emissions
Action program, which covers
business activities that are
naturally and has demonstrated
efforts to mitigate carbon gas
environmentally friendly through
strong consistency in efforts to
emissions, efficiencies in energy
the substantial reduction of
mitigate carbon gas emissions
usage, the use of renewable energy
physical mobility. We are also
through the application of the
sources, the implementation of
striving our utmost to safeguard
REDD+ (Reduce Emissions
paperless offices, an improved
natural resources through the
from Deforestation and Land
environmentally friendly culture,
application of the 3R principle
Degradation) program. This
and so forth.
(recycle, reuse, reduce). This
program involves all layers of
As part of our participation in
principle is an important
society, the government and
mitigating the effects of CO2 gas
consideration in the preparation
industry players in its realization.
emissions, we apply a carbon
of pro-environment policies. The
Through this joint effort, the
free concept through the use
implementation of the 3R principle
Indonesian Government believes
of solar powered cells, micro
includes the installation of waste
the Earths sustainability and that
hydro energy and low power
water management at the Head
of all its contents will be achieved.
consumption equipment to
Offices in Jakarta and Bandung.
At the same time, communities
operate our 3,996 outdoor BTS,
around the forests are seeing
subsequently successfully reducing
We continue to support the growth
improving welfare, such that future
CO2 emissions by the equivalent
of an environmentally friendly
generations will have a healthier
of 961.39 tons per year. Meanwhile,
culture through the national Bike
planet.
indoor BTS are operated with new
to Work movement, which is
energy saving technology.
becoming increasingly entrenched
initiatives within the Kyoto Protocol
are providing various applications

for businesspeople in Indonesia.
among employees, and Earth
As an industry with coverage

across Indonesia, Telkom is
We are trying hard to reduce
Hour, which is promoted by the
strongly committed to managing
emissions from ozone depleting
World Wildlife Fund (WWF). In
this environmental crisis through
substances (ODS) by using
addition, we also actively preserve
various strategic policies aimed at
environmentally friendly coolants,
the environment through direct
mitigating carbon gas emissions
zero depletion refrigerant (no
action involving local community
that occur due to the companys
CFC), zero depletion FAP (N2 100%
participation for various projects,
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21
regreening critical land and the
Telkom distributed 68.4% of this, a total of Rp57.64 trillion, to stakeholders.
creation of city parks incorporating
The economic value distributed to suppliers, employees, national
up-to-date communication facilities
and regional governments, providers of capital and to communities,
in various areas of Indonesia.
demonstrates that Telkoms business activities have a significant economic

impact on its stakeholders economic progress. Telkom contributed to State
IMPROVING SUSTAINABLE
ECONOMIC DEVELOPMENT
revenue in the form of dividends, fees and taxes to the amount of Rp16.74
trillion, an increase of 5.5% on the Rp15.87 trillion the previous year.
We consistently realize a variety

of development programs to take
In addition, through the payment of regional taxes, the direct and indirect
advantage of growth opportunities,
absorption of labor, coaching small and medium business enterprises and
support more efficient activities,
cooperatives, the provision of TIMES facilities and the provision of business
ensure improved economic
opportunities for the public to become part of the business chain, Telkom
performance and the distribution
also actively plays its part in improving regional economies.
of economic value generated to

stakeholders as manifestation
The Development of Social Life
of the economic dimension of
As a company that grows due to its harmonious relationship with its
sustainability. In 2013, Telkom
stakeholders, including employees and local communities, Telkom is
increased its economic value to
determined to improve employee performance, uphold Human Rights,
Rp84.32 trillion, a rise of 8.3% from
and improve its product and civic responsibility as the manifestation of
the Rp77.88 trillion of the previous
sustainability from the social dimension.
year.
22

2013 Sustainability
Performance
Overview
About Telkom
About
This Report
Economic
Growth
Telkom Shares
We distance ourselves from
customer satisfaction index with
LOOKING AHEAD
discrimination based on ethnicity,
optimum assessment results from
Telkom is committed to continue
religion, class and gender in the
year to year.
its support of efforts made by
management of human resources,
the global community to improve
while acknowledging diversity
Telkom also actively participates
environmental conditions and to
and providing equal rights for
in government efforts to improve
mitigate the effects of climate
employees to progress along their
the conditions of marginal
change, which remain the
career path out of respect for
communities, poverty alleviation,
primary issue in the context of
Human Rights. We have established
improving public health and
sustainability. The chain of extreme
Telkom Corporate University
providing satisfactory public
weather, climate change and global
(Telkom CorpU) to develop
facilities and infrastructure,
warming affects all human activities
excellent and dignified people for
improving regional operations that
and has business consequences
Telkom and assign employees to
encompass remote areas across
faced by all corporate entities,
participate in training to improve
Indonesia. These community
including Telkom. Potential
their competencies. In addition, we
development activities are realized
risks faced by Telkom include
have established various leadership
through the implementation of
network and telecommunication
development programs, in which
the Partnership and Community
infrastructure damage, which in
897 employees have taken part, to
Development Program, supported
turn has the potential to reduce the
prepare our leaders for the future.
by sufficient funding.
companys economic value in both
Telkom has also implemented
the short and long term.
entrepreneur training programs to
In 2013, Telkom disbursed funds for
prepare employees approaching
education and training amounting
For this reason, Telkom is
retirement age to provide them
to Rp20.96 billion, Rp18.82 billion
committed to actively participating
with skills for retirement.
for public, including religious
in mitigating the effects of global
facilities, Rp5.37 billion for the
warming through the reduction
Telkom also displayed consistent
provision of health facilities and
of carbon emissions from its
efforts in maintaining and
infrastructure, Rp6.63 billion aid
operational activities and supports
safeguarding its zero accident
for poverty alleviation and a total
environmentally friendly business
achievement in various operational
of Rp1.47 billion for aid to victims
activities based on development of
areas, an achievement reached
of natural disasters. This funding
the TIMES business. Through this
through the involvement of all
demonstrates Telkoms active
method, Telkom can demonstrate
levels of employee in upholding
participation in the achievement of
its strong commitment to efforts
work regulations related to health
the 2015 Millennium Development
to responsibly and sustainably
and the awareness of the risk
Goals (MDGs) initiated by the
manage natural resources for
of workplace accidents. Telkom
government long ago.
a better future for the coming
understands its responsibility

toward the health of its customers
and continues to develop prime
services for its customers, as well
as selecting high quality vendor
products. With this approach, we
have successfully maintained our
generations.
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index
Closing
Toward 2014
At this time, we express our
We encourage all employees and
thanks to the shareholders, in
the management to work even
particular the SOE Ministry, which
harder in running environmentally
has provided direction to improve
friendly operations, improving
Telkoms sustainability performance.
social care for employees and
We appreciate the advice and
society, and to improve the welfare
direction of Telkoms Board of
of all stakeholders.
Commissioners, which has enabled

the entire workforce to improve
A bright future for Indonesia is a
the companys sustainability
bright future for Telkom Indonesia!
performance in 2013.
The Telkom Board of Directors,
of course, expresses its highest
appreciation to all the employees
for their dedication and hard work
to ensure an improved sustainability
performance compared to the
previous year.
Arief Yahya
President Director

23
24

2013 Sustainability
Performance
Overview
About Telkom
About
This Report
Economic
Growth
Telkom Shares
G4-3 | G4-4 | G4-5 | G4-6 | G4-8
About Telkom
PT Telekomunikasi Indonesia
PRODUCTS AND SERVICES
(Persero), Tbk is a State Owned
As a company providing TIMES services, we continue to innovate in sectors
Enterprise (SOE), with its head
other than telecommunications, as well as to develop synergies between all
office at Gedung Grha Merah Putih,
products, services and solutions, moving from a legacy business to a New
Jalan Japati No. 1 Bandung and
Economy Business (NEB).
with branches spread across the

whole of Indonesia.
Our business portfolio is grouped into several lines of business, as follows:

See Pages 47-53 of the Telkom 2013 Annual Report.
Per 31 December 2013, we owned
1. Telecommunication Business
a total of 572 customer service
a. Fixed Wireline Services
offices (Plasa Telkom) spread
Products under the fixed wireline services are Plain Old Telephone
across 34 provinces and 511
Services (POTS), value added services (VAS), Intelligent Network
towns/regencies across Indonesia
(IN) services and Session Initiation Protocol (SIP) service. IN
supported by 25,011 employees.
services are internet protocol (IP) based network services connected

to the Telkom telecommunication network and exchange system.
SIP services are based on IP Multimedia Subsystem (IMS) that
integrates wireless and wired voice and data communication.
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

25
b. Fixed Wireless Services
access through a wireless internet connection
Services under the brand Telkom Flexi or Flexi
supported by our hotspot infrastructure.
make use of limited mobility CDMA technology
Services can be easily accessed through all
and are managed under the Wireless Broadband
Wi-Fi enabled equipment merely through the
Division.
use of a FlexiNet Unlimited or Flexi Mobile
c. Cellular Services

Cellular communication services are implemented

through the subsidiary, Telkomsel, and make
use of GSM technology on the 3.5G frequency.
Cellular products and services are divided into
two models, post-paid services through the
available at every hotspot.

- Virtual Private Network (VPN), is a private
network using media such as internet to safely
connect to a remote site.
- Astinet, provides high quality internet access
kartuHalo product, and pre-paid services through
using a default internet gateway and public IP
the simPATI and Kartu As products.
address for a dedicated, fixed communication
d. Network Services

Broadband username and password, which are
The Telkom network services encompass satellite
line 24 hours a day.

- VoIP, Telkom provides affordable international
transponder leasing, satellite broadcasting,
call services through our premium VoIP service
VSAT, audio distribution and satellite-based and
package Telkom Global-01017, while Telkom
terrestrial-based leased lines.

e. Broadband and Internet Services
- Broadband internet is offered under the
Save provides regular international calls.

- ISDN PRA is a digital network to facilitate
multimedia telecommunication services making
commercial name Speedy and provides
use of wider bandwidth and inter terminal
broadband internet and non cellular services.
digital systems to provide voice, data and video
- Cellular data communication. Telkomsel
communication through a single channel with
provides internet and data communication
high speed, quality and capacity. Telkom also
through its cellular network under the
provides ISDN-based internet access.
commercial name Flash.

- SMS services for cellular and fixed wireless
telephone subscribers.
- Dial up internet connection is provided under
the name TelkomNet instan.
- Wi-Fi/hotspot is a wireless access solution for
- DINAccess is a communication service

with dedicated access to provide LAN
interconnection services and multimedia
services at a speed adjustable to customer
needs.
- Global Datacom is a data communication
mobile internet data services in certain areas
service that lets corporate customers connect
utilizing Telkoms and other ISPs payment
their headquarters with branch offices or clients
facilities, or in bulk using Customer Premises
across the globe. Telkom works with global
Equipment (CPE)-based Wi-Fi technology. In
partners through Telin, a subsidiary, to provide
2012, we launched the Indonesia Wi-Fi service

to meet public need for Wi-Fi-based internet
this service.
- Metro Link is a Metro-network-based
services in public places, such as airports,
connectivity service that accommodates point-
shopping malls, hospitals, universities/schools,
to-point, point-to-multipoint and multipoint-to-
cafes and other public places, with a target of

1 million access points in 2013. Indonesia Wi-Fi
multipoint communications.
- Metro I-net is a high capacity data network
has been rolled out with a minimum speed of
solution based on IP (Internet Protocol) or
10 Mbps to accommodate roaming, offloading,
ethernet that provides flexibility, ease of use
retail and other needs.
and effectiveness, as well as quality assurance
- FlexiNet, is our internet access service that

uses the Telkom Flexi network. In 2011, we
for corporate and SME customers.

- Port Wholesale provides wholesale rental
launched our Flexi Hotspot service for
of port remote access servers to internet
customers wishing to enjoy high speed internet
service providers, content service providers

and corporate customers to sell on to their
subscribers.

26
2013 Sustainability
Performance
Overview
About Telkom
- Value-added service. Datacom provides
About
This Report
Economic
Growth
Telkom Shares
2. NEB Portfolio and Strategic Business
additional facilities offering added value for
Opportunities
data communication customers.
Portofolio NEB dan Strategic Business Opportunities
f. Interconnection Services
mencakup:
a. IT Outsourcing or Managed Application, which
Telkom also earns revenue from other

telecommunication operators that utilize our
consists of cloud-based and server-based
extensive infrastructure network in Indonesia,
management services, as well as IT consultation
both for calls that end at or transit through our
services.
network.
g. Ancillary Services

b. e-Payment/Payment Services, covering:

- Billing Payment is a service that facilitates
We have exclusive agreements with several
customers making payment transactions for
investors under revenue sharing arrangements
service providers or goods, such as PT PLN,
to expand fixed line phone services, public card
Telkom, PDAM, PT KAI and other services,
phones (including their maintenance), data and
through collecting agents such as banks,
internet networks, and ancillary facilities related
cooperatives, BPR, convenience stores and
to telecommunications.
other agents;
- Remittance is a money transfer service where
In addition, we also have several supporting and
neither the sender nor the receiver needs a
ancillary businesses, which include the lease and/
bank account to complete the transaction
or supply of BTS to other cellular operators and the
as transfers can be accomplished using only
provision of various support facilities. We manage
mobile equipment;
our telecommunications tower business through our

subsidiary, Mitratel.
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

27
G4-9 | G4-12
- e-Money provides services to customers who
d. Portal services facilitate content aggregation
wish to manage money electronically through
and distribution. In addition to sales and
certain media (cell phone, prepaid card, or a
payments related to the companys products
virtual account that can be accessed via the
and services conducted through our
Internet) for use in electronic transactions;
e-commerce portal, our e-store portal and on-
and
device portal services also facilitate the sale and
- e-Voucher or Telkom Voucher is a single
distribution of content and applications, such
voucher issued by Telkom that can be used to
as games, applications, news, sport information,
purchase or refill services provided by Telkom
education content, music, ring back tones, SMS
Group, such as Kartu As, simPATI, Flexi
content and others that can be downloaded
Trendy, post-paid TelkomVision services and
directly on the customers mobile device or web.
Speedy Hotspot.
This content and application can be obtained
c. IT enabler services include business process
either for payment or free of charge.
outsourcing and knowledge process

outsourcing, which consists of:
- Network-centric value added services,
COMPANY SCALE
comprising IT-based value added services

for data and phone, security services,
and server and storage for connectivity
2013
25,011
25,683
82,967
77,143
- Total Liability (Rp billion)
50,527
44,391
Equipment (CPE), applications and software,
- Total Equity (Rp billion)
60,542
51,541
as well as computer hardware.
- Total Assets (Rp billion)
127,951
111,369
customers; and
- Integration services, comprising integration
services for network and hardware
associated with Customer Premises
Media and Edutainment business portfolio,

comprising:
a. Pay TV offering packets or a la carte provided
Number of Employees (People)
2012
Net Revenue (Rp billion)

Total Capitalization:
RELATIONSHIP WITH SUPPLIERS (SUPPLY

CHAIN)
through satellite or cable or IPTV (Internet
G4 has introduced a number of new approaches, one
protocol-based television) with premium
of which is a concept related to the organizations value
content including news, sport, entertainment
chain. The definition of the GRI G4 supply chain is a
and others. This service is managed by our
sequence of activities or parties that provide products
subsidiary, Indonusa Telemedia, under the brand
or services to the company. This concept, as defined in
TelkomVision. Meanwhile, commercial IPTV
GRI G4, is an important aspect both inside and outside
services were launched in August 2011 under the
the company.
brand Groovia TV and are currently available

in all regions included in the service provision
We recognize the importance of parties who act as
license, namely Jabodetabek, Bali, Bandung,
suppliers in the sustainability of our operations. Positive
Semarang and Surabaya. Per 31 December 2012,
reciprocal interaction and mutual support between
the Company had 1.2 million Pay TV subscribers.
us and the suppliers has a positive impact on our
b. UseeTV - Over the Top TV (OTT TV) is a TV
performance, thus ensuring the sustainability of the
service accessible for subscribers over the
company. Therefore, our partners / suppliers are part
internet.
of the business operations chain.
c. Advertising is a commercial service for the

promotion of products or services owned by a
third party that is presented through digital or
print media, such as radio, television, internet,
newspapers, brochures/leaflets and billboards.
28

2013 Sustainability
Performance
Overview
About Telkom
About
This Report
Economic
Growth
Telkom Shares
G4-13 | G4-14
In order to fulfill the need for goods / services
a road map to develop Entity Risk Management as
implemented by our partners, we apply the integrated
follows:
supply chain concept. In addition, the procurement

and partnership process is computer-based to minimize
physical contact between suppliers / partners with us
to facilitate fairness and transparency.
- 2013 : increased ERM Maturity Level to initial Stage

Quantified Level.
- 2014 : increased ERM Maturity Level to intermediate
Stage Quantified Level.
- 2015 : increased ERM Maturity Level to advanced
SIGNIFICANT CHANGES
There have been no significant changes during the
reporting period to the ownership structure or to the
stage Quantified Level.

- 2016 : increased ERM Maturity Level entering
Optimized Level.
field of business. We remain committed to continuing

fundamental and comprehensive transformation at all
The companys vision related to risk management
levels of business.
implementation is, Making risk management an

INHERENT CULTURE in the implementation of business
processes and operations. Therefore, since 2008, we
MITIGATION PRINCIPLE APPROACH
have built and developed the following:
Since 2006, we have been committed to applying

risk management based on the Enterprise Risk
- Structural aspects, encompassing the development
Management framework. In practice, risk management
of a risk management vision, mission, commitment,
is an inseparable part of a companys GCG application
tone at the top, conducive internal environment,
and internal control. Moving ahead, we have compiled
policies, competency development, IT tools and

systems.
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

29
G4-7 | G4-15 | G4-16
of Risk Acceptance Criteria, Risk Assessment
MEMBERSHIP IN INDUSTRY ASSOCIATIONS

AND OTHER ORGANIZATIONS
implementation and the development of risk
Telkom actively participates in several national and
management for specific functions.
international associations. In the national arena, we are
- Operational aspects, encompassing determination
- Aspects of care, encompassing monitoring risk
members of:
management implementation, periodic risk
1. The Indonesian Infocomm Society (MASTEL);
reporting, ensuring sustainable competency
2. The Indonesian Satellite Association (ASSI);
development, as well as conducting reviews through
3. The Telecommunications Interconnection Clearing
a Risk Management Index, Risk Culture Survey

and evaluation of Implementation Maturity Levels.
At this time, risk management implementation
Association (ASKITEL); and

4. Corporate Forum for Community Development
(CFCD).
has reached a level whereby risk management is

integrated across all subsidiaries.
In the international arena, Telkom is a member of

associations including:
In addition, in our efforts to manage risk, we are doing
1. Asia Pacific Network Information Centre (APNIC),
the following:
a non-profit organization aimed at ensuring the
1. building and developing structural, operational and
stability and reliability of internet resources in the
care aspects for risk management implementation in

all subsidiaries;
2. improving the quality of risk-based decision making
(six eyes principle);
3. developing Business Continuity Management and
Crisis Management;
4. developing Revenue Assurance to protect from
leakage and an anti-fraud program;
5. development of Enterprise Security Governance
Asia Pacific region;

2. ITU Telecommunication Development Sector
(ITU-D), an organization responsible for creating
policy and supplying training programs, as well as
funding strategies related to telecommunications for
developing countries; and
3. ITU Telecommunication Standardization Sector
(ITU-T), an organization responsible for the creation
of telecommunication standards.
to protect physical and non-physical assets (e.g.

Information System Security with the development
6. developing an Internal Control Program; and
OPERATIONAL STRUCTURE AND SHARE

OWNERSHIP
7. developing Regulatory Management.
To the end of the reporting period, Telkom owned
of ISO 27000);
23 subsidiaries, consisting of 9 subsidiaries with

direct ownership and 14 subsidiaries with indirect
COMMITMENT TO EXTERNAL INITIATIVES
ownership. These subsidiaries form part of our business
We always comply with government regulations
development strategy and contribute to increased
and strive to apply the standards in force in the
revenue. Telkoms majority shareholder (53.14%) is the
telecommunications industry for governance
Government of the Republic of Indonesia, with the
and business practices to monitor and measure
remainder of the company (46.86%) owned by the
performance in accordance with applicable regulations
public.
and legislation for publicly listed companies.

Our shares are recorded and traded on the Indonesia
Stock Exchange (IDX) and New York Stock Exchange
(NYSE) under the share codes TLKM and TLK.
30
2013 Sustainability
Performance
Overview

About Telkom
About
This Report
Economic
Growth
Telkom Shares
G4-17
Telkom Group Structure

53,14%
35%
65%
100%
Celluler
Multimedia
eBay
International age
Ir. Rinaldi
Buchari
40%
Telco Equipment
Ir. Harry John
Dedy
Mardhianto
PT Jiraf Imaji
Solusi
0,01%
0,01%
49%
0,01%
99,83%
100%
Tower Business
Ir. Rinaldi
Buchari
0,17%
60%
100%
99,99%
99,99%
99,99%
51%
49%
99.83%
60%
0.17%
40%
Ir. Rinaldi
Buchari
PT Mekar
Prana Indah
51%
75%
25%
1. PT SWADAYANUSA
KENCANA RAHARJA 9,5%
2. Sofian Susantio 9,5%
3. Ravi Varma Kanason 4,75%
4. Shia Kok Rat 1,25%
99,99%
0,01%
Bambang
Lusmiadi
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

31
46,86%
Erry Anwardiredja
0,01%
100%
99,99%
International
Business
100%
Netco & Opco
Property &
Construction
100%
100%
100%
VSAT
100%
55%
49%
100%
51%
100%
45%
49%
51%
20%
80%
- Trans Corpora 80%

- Telkom 19,54%
- TelkomMetra 0,46%
25%
38.29%
PT TIGATRA
MEDIA
22,38%
36.71%
Media Trio (L)

Ine
1. Magic Alliance Labuan

Limited 24,10%
2. The Bank of New York 10%
3. Telesat Canada 3,70%
4. Hughes
Telecommunication &
Space 3,70%
5. Others 22,80%
32

2013 Sustainability
Performance
Overview
About Telkom
About
This Report
Economic
Growth
Telkom Shares
G4-28 | G4-29 | G4-30 | G4-32 | G4-33
About This Report

This 2013 PT Telekomunikasi
Indonesia Tbk (Telkom)
Sustainability Report (the Report) is
the eighth Report since the first one
was published in 2006. This Report
has been compiled to comply
with stipulations in Article 66
paragraph 2c of Law No. 40/2007
on Limited Liability Companies,
which requires the submission of a
Corporate Social and Environmental
Responsibility (CSR) activities
report and an Annual Report.
CSR, according to Article 1 of
Law No. 40/2007 is a companys
commitment to play a role in
sustainable economic development
to improve the quality of life and
the environment in a manner that is
beneficial to the Company itself, the
local community and the public in
general. Through this Report, we
This report covers the period 1 January 31 December 2013. The previous
are submitting to the stakeholders
Report, the 2012 Sustainability Report, was published in June 2013.
Telkoms sustainability performance
Telkom has published a Sustainability Report annually to provide a clear
for economic, environmental and
illustration, as well as to assess management performance, of the economic,
social aspects during 2013.
environmental and social aspects as additional information to the financial

performance presented in the Annual Financial Report.
In preparing this Report we used the sustainability reporting guidelines
issued by Global Reporting Initiative (GRI), version 4 (G4), which is
internationally recognized and widely accepted. These Guidelines provide
two GRI-4 compliant options, namely core and comprehensive. This Report
is compiled based on GRI G4-Core.
We have provided special G4 indicators on each relevant page to enable
readers to easily find information related to each indicator, meanwhile, the
overall G4-Core index list can be seen on page 110.
The GRI G4 indicators disclosed in this Report relate to the matters
considered material and relevant to Telkoms business. Those GRI G4
indicators that are not material, or that are irrelevant, to Telkoms business
are not disclosed in this Report.
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

33
G4-18
REPORT CONTENT DETERMINATION PROCESS
3. sustainability context, aspects
To determine the topics and content of this report, we used the 4 (four)
related to the sustainability
steps required by GRI G4, namely:
context that are relevant for
1. identify material aspects and boundary (identification);
inclusion in this Report needed
2. prioritize the identified aspects from the previous step (prioritization);
for decision making; and

4. completeness, this Report has
3. validate these material aspects (validation); and
been compiled with a clear
4. review Reports that had previously been published to improve the
scope for the 2013 reporting
quality of the following years Report (review).
period and is supported by

The content determination for this Report is based on 4 (four) principles, in
complete data.
accordance with GRI G4, namely:

1. stakeholder inclusiveness, involving stakeholders in the determination of
These four steps to determine

the content of this Report are
material to be disclosed in this Report;
illustrated in the Report Content
2. materiality, the content of this Report has been selected based on
Determination Process Flow Chart,
material aspects required by the stakeholders;
following.
Report Content Determination Flow Process

Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

Step 1
IDENTIFICATION
Step 2
PRIORITIZATION
Step 3
VALIDATION
Sustainability
Context
Materiality
Completeness
Stakeholder Inclusiveness
Step 4
REVIEW
Sustainability
Context
Stakeholder
Inclusiveness
Global Talents and
Opportunities
2013
Sustainability
Report
34

2013 Sustainability
Performance
Overview
About
This Report
About Telkom
Economic
Growth
DETERMINING MATERIALITY LEVEL

Materiality in this case means matters considered to be relevant to Telkoms business
and having a significant impact on stakeholders in the decision making process. To
determine materiality for this Report, we have involved the stakeholders by issuing them
a materiality survey. Several groups of stakeholders were involved in the survey, including
the government, customers, labor unions, suppliers, communities and social welfare
organizations. In addition, we have also paid attention to the opinions and advice of
HIGH
stakeholders regarding the previous years Sustainability Reports.
2
1
MEDIUM
10
12
LOW
Important to stakeholders
11
LOW
MEDIUM
HIGH
important for telkom
1
2
3
4
5
6
Economic Empowerment
Community Development
Contribution to State Revenue
Business Ethics
Quality of Services
Respect for Human Rights
7 Employee Benefits
8 Training and Education
9 Occupational Health and Safety
10 Energy Conservation and Efficiency
11 Carbon CO2 Emissions Mitigation
12 Sustainable Supplier
Telkom Shares
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

35
G4-12 | G4-17
REPORT BOUNDARY
SUPPLY CHAIN
This Report covers the activities
We have identified the group of suppliers that has a dominant impact on
of Telkom and its subsidiaries, as
the sustainability of Telkoms business. The suppliers referred to in this
noted in the consolidated financial
Report are those that supply special goods and services, such as those
report. The Financial and Human
supplying labor for security, transportation, cleaning services, marketing
Resources data, as well as some
and maintenance/repairs. The businesses of these suppliers potentially
of the environmental data, in this
could impact directly on Telkoms image and reputation, especially
Report has been consolidated
related to compliance with manpower legislation and occupational health
with that of our subsidiaries, while
and safety. Therefore, to reduce any negative impact, we have tight
the Community Development
selection procedures for suppliers and consider their compliance with
and Partnership data only covers
labor legislation. Every contract entered into with a supplier is regulated
Telkom as the parent company and
through clauses that require the supplier to abide by regulations and
does not include data managed by
legislation related to manpower. In the reporting period, there have been
each subsidiary.
no significant violations made by our suppliers.
We have used financial data

measurements based on
Indonesian Financial Accounting
Standards (Pernyataan Standar
Akuntansi Keuangan - PSAK).
Meanwhile, for the sustainability
data we have made use of data
measurement techniques that
are internationally valid, such as
gigajoules to calculate energy use.
Quantitative data in this Report is
presented using the comparability
principle for a minimum of two
consecutive years, such that this
Report may be used to analyze
trends. There is no restriction
in determining the scope and
boundary of this Report. In
addition, in accordance with
GRI-G4 Guidelines, to determine
the Reports quality the principles
used are balance, accuracy,
timeliness, clarity and reliability.

36
2013 Sustainability
Performance
Overview
About
This Report
About Telkom
Economic
Growth
Telkom Shares
G4-19 | G4-20, G4-21
DETERMINING MATERIAL ASPECTS AND BOUNDARY

The process to determine material aspects and boundary was conducted through
Focus Group Discussion (FGD) attended by the team responsible for preparing the
2013 Sustainability Report and Telkom employees from various work units. Material
aspects were determined through consideration of impacts on Telkoms business
and the effect on stakeholders. In addition, consideration was made of the effect on
Telkoms reputation and branding. The findings of the FGD are summarized in the
table below.
MATERIALITy aspects and BOUNDARY

Materiality Aspects
ECONOMY CATEGORY
Boundary
Economic Performance
Market Presence
Indirect Economic Impact
ENVIRONMENT CATEGORY
Energy
Emissions
ou
SOCIAL CATEGORY
Sub Category: Labor
CLE
NS
AN
IN
NS
TRA
ICE
Diversity and Equal Opportunity
ny
RV
Training and Education
e the compa
SE
Occupational Health & Safety
PO
Employment
IO
AT
RT
ts i d
Equal Remuneration for male and female

employees
Supplier Labor Practices Assessment
Anti-corruption
Public Policy
Anti-competition or anti-monopoly
Sub Category: Product Responsibility

Providing Product and Service Labeling
Telkom
Subsidiary
Outside the Company
r
to
ac
r
t
n
co
Local Communities
Sub Category: Community
min
in
TY
Suppliers Human Rights Assessment
CU
Security Practices
SE
Freedom to Associate and Collective Labor

Agreement (CLA)
Subsidiary
RI
Sub Category: Human Rights
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

G4-13 | G4-22 | G4-23 | G4-24 | G4-25 | G4-26 | G4-27 | G4-31
RELATIONSHIP WITH STAKEHOLDERS

One important element in good corporate governance is the
implementation of a harmonious relationship with stakeholders. To achieve
this, we always strive to understand the needs and expectations of our
stakeholders to facilitate fairness for them. Through the corporate culture,
The Telkom Way, the management works to instill the corporate culture
and values such that employees at every level understand and values that
must always be used with all stakeholders.
We are committed to establishing two-way interaction that is mutually
supportive with our stakeholders. This will result in optimum benefit for
the stakeholders, as well as the company, and thus ensure the companys
sustainability.
SIGNIFICANT CHANGES FROM THE PREVIOUS YEAR
PERSONAL CONTACT
This year is the first time that this Report has been prepared using GRI
For further information regarding
G4, thus there are minor differences in the presentation format from
this Report, please contact:
previous years, which made use of GRI G3.1. However, despite the change
in the guidelines for the preparation of this Report, overall there is no
Investor Relations
substantial effect or restatement of information contained in reports from
Graha Merah Putih
previous years. Likewise, during the reporting period there has been no
5th Floor
fundamental change in Telkoms business structure. Fundamental changes,
Jl. Jend. Gatot Subroto Kav. 52,
as intended for this Report, would be acquisitions, mergers, company
Jakarta 12710, Indonesia.
restructuring and downsizing.
Tel: (62-21) 521 5109

Fax: (62-21) 522 0500
Email: investor@telkom.co.id.
37
38

2013 Sustainability
Performance
Overview
About Telkom
About
This Report
Economic
Growth
Economic
Growth
Supporting Indonesias
Economic Growth
40
Supporting Regional
Economic Growth
43
Development Strategy
40
43
Supporting Improved
Economic Conditions for
Stakeholders
41
Fostering Good
Relationships with Partners
Community Economic
Empowerment
44
Contribution to State
Revenue
42
Development Partner
Success Stories
47
Telkom Shares
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

Telkom continues to support efforts to

improve economic growth in Indonesia, both
at the national and local level, by improving
the quality of telecommunication services and
intensive education on the use of information
technology (IT) applications
39
40

2013 Sustainability
Performance
Overview
About Telkom
About
This Report
Economic
Growth
Telkom Shares
G4-EC7
SUPPORTING INDONESIAN
ECONOMIC GROWTH
Indonesian economic growth
achievement of Telkoms vision, to
has tended to be moderate, in
become a leading TIMES company
Telkom understands that the
the range of 4.5% - 6.5%. In
in the region.
support and availability of a reliable
2013, the national economy grew
telecommunication infrastructure
only by 5.78%. This moderate
Telkom continues to increase
is an urgent need that must be
growth implies the existence of
synergies among the various
met considering the geography
obstacles hindering the pace
telecommunication services
of Indonesia, which consists of a
of economic growth, namely
available and to take advantage of
cluster of islands with inadequate
infrastructure limitations. To
non-organic growth opportunities
physical infrastructure. Telkom
overcome these limitations
by expanding into overseas
also realizes market growth
and ensure higher growth in
markets. Telkoms preferred
opportunities are promising given
the future, the government
method of acquisition is to
the large Indonesian population,
has rolled out the Acceleration
establish business alliances and
accompanied by stable economic
and Expansion for Indonesian
strengthen its presence in the
growth over recent years.
Economic Development Master
domestic market through network
Plan (MP3EI), a development
expansion and deepening of
The Indonesian government
program that aims to accelerate
the TIMES business structure
has long since deregulated
the provision of basic infrastructure
through careful planning. Telkoms
to a free market that allows
such as roads, ports, airports,
strategic objective is improving
private businesses to join the
electricity and telecommunications.
market capitalization. To achieve
telecommunications industry.
It is believed that this overall
this strategic objective, Telkom
This was implemented based on
infrastructure will play an important
implements three main strategies,
consideration of the important
role in stimulating growth in the
namely:
role of telecommunications in
Indonesian economy.
1. directional strategy: sustainable

competitive growth;
development, while the state

budget has constraints for
With all this development,
telecommunication development.
Telkom believes that the current

projections and trends in general
2. portfolio strategy: converged

TIMES portfolio; and
3. parenting strategy: strategic
Recent developments indicate
show strong growth for data
that the Indonesian economy
services and a shift from traditional
continues to grow in line with
telecommunication toward HSPA+
These three key main strategies are
increasing domestic consumption
and LTE technologies. Taking into
further elaborated in 10 strategic
resulting from an increased
account market opportunities
initiatives, as follows:
level of social welfare. Society
and TIMES service capabilities,
1. center of excellence;
requires the support of a reliable
Telkom is committed to developing
2. focus on portfolios with high
telecommunication technology
business, expanding and enhancing
infrastructure to communicate,
network capabilities to support
as well as for data transmissions.
Indonesian economic growth.
guidance.
growth or value;
3. accelerated international
expansion;
4. cost transformation;
On the other hand, empirical

studies show that the penetration
DEVELOPMENT STRATEGY
of internet access and fixed line
Telkom continues to perfect its
telephones in Indonesia remains
strategic initiatives with focus
6. Indonesia Digital Solution (IDS)
low compared to other countries
on the implementation of the
Convergence services for
in the region. These facts illustrate
TIMES business framework
digital ecosystem solutions;
that growth opportunities in the
and strengthening internal
7. Indonesia Digital Platform (IDP)
telecommunication industry in
consolidation. This refinement is
Platform enabler to develop
Indonesia are very promising.
being implemented to ensure the
ecosystems;
5. IDN development (id-Access, idRing, id-Con);
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

41
G4-EC1 | G4-EC3
8. execution of best subsidiary

management system;
9. portfolio management through
Board of Executive (BoE) and
Total economic value distributed for one group of stakeholders, namely

providers of capital, rose 22.6% from Rp11.85 trillion in 2012 to Rp14.52
trillion in 2013. In line with Telkoms improved financial performance,
dividends distributed and total interest paid also rose.
Chief Regional Officer (CRO);

and
10. increased synergy within
Telkom Group.
The distribution of economic value to other stakeholders, consisting of

payments to suppliers of goods and services, (BTS providers, content
providers, satellite transponder leasing, costs and so on) totaled Rp25.91
trillion, a fall of 23% from payments in 2012, which reached Rp33.65 trillion.
Further explanation regarding
Distribution to other stakeholders, such as payments to the State in the
Telkoms Business Development
form of taxes and fees, totaled Rp7.39 trillion and payments to employees
Strategy can be found in the 2013
totaled Rp9.73 trillion.
Telkom Annual Report.

Details of the economic values received and distributed can be seen in the
Economic Value Summary table below.
DISTRIBUTING ECONOMIC
PERFORMANCE TO
STAKEHOLDERS
Telkom considers sustainability
from an economic perspective
is efforts undertaken with the
aim of supporting the economic
capacity of stakeholders. Thus,
sustainability from an economic
Economic Value Summary (Rp billion)
2013
2012
2011
82,967
77,143
71,253
843
596
546
Direct economic value generated

Revenues:
a) Net Sales
b) Revenues from financial investments
- Interest income
perspective considers the
- Dividend income
economic impact on stakeholders
- Royalties
99
65
39
413
78
62
84,322
77,882
71,900
25,913
33,651
25,416
a) Payroll
2,356
2,084
1,973
b) Benefits
7,376
7,003
6,065
years Rp77.88 trillion. With this
Total employee wages and benefits
9,732
9,087
8,038
figure, the positive impact on
Payment to providers of capital:
stakeholders economic condition
a) Dividend payment
13,044
10,734
9,102
overall resulting from total
b) Interest payment
1,476
1,111
1,591
14,520
11,845
10,693
Payment to government
7,390
5,586
5,359
Community investments
85
129
290
Economic value distributed
57,640
60,298
49,796
Economic value retained before dividend
39,726
28,318
31,206
Economic value retained after dividend
26,682
17,584
22,104
resulting from Telkoms operations.

In line with increased economic
performance, Telkoms support of
its stakeholders economic growth
- Income generated from assets

c) Revenues from sale of assets
Total direct economic value generated
during 2013, with the exception of

suppliers, also increased compared
Economic value distributed:
to the previous year.
Operating costs
Economic value received in 2013

totaled Rp84.32 trillion, an increase
of 7.5% compared to the previous
economic value distributed totaled

Rp57.64 trillion.
Employee wages and benefits:
Total payment to providers of capital:
42

2013 Sustainability
Performance
Overview
About Telkom
About
This Report
Economic
Growth
Telkom Shares
The increase in distribution of
Telkom Pension Fund reached
development, maintenance and
economic value to employees
Rp187 billion, Rp186 billion and
purchase of the latest technology
totaled 7.1%, primarily resulting
Rp182 billion respectively for 2011,
applications, as well as the creation
from a 13.1% increase in salary
2012 and 2013. The DBPP fund is
of information technology-based
and 5.3% in benefits. These
managed by the Telkom Pension
service innovations. The economic
increases were primarily derived
Fund for Telkom and PT Asuransi
value percentage distributed for
from a policy adjusting Telkoms
Jiwasraya (Persero) for Telkomsel.
operational costs demonstrates

the amount of funds allocated to
remuneration package to support

improved welfare for employees.
Meanwhile, for the DCPP, the
develop and improve the quality of
Telkom saw a fall in total employees
funds are managed by several
network transmission. At the same
during the reporting period of 2.6%.
Financial Institution Pension Funds
time, Telkom is also required to
(DPLK). Employees may select
improve operational management
In addition to the salary
one of several DPLK that provide
efficiency to maintain the
component, Telkom is also paying
this program. Telkoms annual
performance of the entire managed
greater attention to improving
contribution to these DCPP is
network.
the quality of benefits provided
determined by the percentage
to employees. Benefits are
taken from participating employees
The economic distribution table
designed to motivate employees
basic salaries and totaled Rp5
above shows that Telkoms
to always work to their full ability,
billion, Rp5 billion and Rp6 billion
increased performance overall
effectively and efficiently, to
respectively for the years 2011, 2012
does not only mean increased
satisfy the KPI targets that have
and 2013.
wealth for shareholders, but also

has a positive impact on other
been set. In addition, benefits

are provided to provide peace
Telkom also provides its employees
stakeholders, namely the creditors,
of mind to employees, including
with the option to take early
government, employees, partners
through the through the design of
retirement from the age of 56
and the local communities.
a pension program that can ensure
through its Early Retirement
a satisfactory quality of life for
program. This program is run
employees when they retire.
periodically, depending on the

Companys financial ability and
CONTRIBUTIONS TO STATE
REVENUE
Telkom provides adequate
employee needs, to ensure the
Telkom also distributes economic
pension programs in two choices
achievement of both short-term
value generated regularly
of package, namely the Defined
and long-term goals. In 2013,
and in several forms as direct
Benefit Pension Plan (DBPP)
Telkom did not implement its Early
contributions to State revenues.
tailored for permanent employees
Retirement program.
Telkom pays the government
who were hired prior to 1 July
dividends according to the
2002 and the Defined Contribution
In addition to the pension program
economic performance it achieves,
Pension Plan (DCPP) that applies
and performance bonus initiatives,
pays various kinds of taxes and
to other permanent employees.
Telkom also provides a variety of
periodically pays fees for the right
other benefits to its employees,
to provide telecommunication
In the DBPP, employees are
including health benefits and
services, as well as fees for the
enrolled with participation of 18%
various other things discussed in
right to use frequencies.
of basic salary (prior to March
Telkoms People.
2003, employee contribution was
Total economic value distributed to
8.4%) with the company making up
To ensure performance and
State revenues during 2013 reached
the remainder of the contribution.
increase the signal transmission
Rp16.74 trillion, an increase of 5.5%
The minimum monthly pension
power capability of the entire
from the Rp15.87 trillion in 2012.
for employees who have retired is
network of managed BTS
Details of Telkoms contribution to
approximately Rp425,000. The
transmitters, Telkom must
State revenue are as follows:
Companys contribution to the
always provide a budget for the
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

43
G4-EC8
Contributions to State Revenues (Rp billion)
across the whole archipelago.

Realization of this program, in
addition to improving Telkoms
1,059
image and reputation, in the long

994
3,098
3,002
442
451
5,284
3,829
KPU Liability
term will create opportunities to
Frequency Usage Rights
increase its revenue. Considering
Telecommunication Service
Provider Rights
Dividends
Taxes
5,586
that regional economic growth will

ultimately provide opportunities for
Telkom to increase its total number
of customers. A description of the
Partnership Program is provided.
6,859
FOSTERING GOOD
RELATIONS WITH PARTNERS
2012
2013
Telkom believes that improving the

quality of working relationships
ENCOURAGING REGIONAL ECONOMIC GROWTH

Telkom also distributes economic value to regional governments in the
form of Land and Building Tax (PBB) on every fixed asset it owns and
operates in support of the Telkom offices. Telkom also pays vehicle tax on
its operational vehicles. These taxes are all direct contributions to local
Regional Revenue. During 2013, Telkoms total PBB amounted to Rp27.78
billion, an increase of 11.1% from the Rp25.0 billion paid the previous year.
Telkoms other contributions were made through the absorption of local
labor from the vicinity of operational areas, which is seen as a strategic
step in supporting regional economic growth. In 2013, Telkom recruited an
additional 838 people from local communities as permanent employees.
Consistent network expansion conducted throughout 2013, along with
efforts to improve the quality of telecommunication services - fixed
network-based, cellular and wireless, also indirectly results in Telkom
contributing to improved regional economic activity. The building of
telephone cable networks, BTS towers and such like has a positive impact
on economic growth, as well as indirectly contributing in the form of
absorbing local labor and providing work for local partners. This, in turn,
increases the quality of life for local communities.
In addition to directly absorbing local labor in its business expansion
activities, as well as causing partners to absorb local labor, Telkom
also strives to support accelerated regional economic growth through
its Partnership Program. This program was rolled out in the 1990s
and continues to be refined in the context of system and operational
procedures, to become more efficient, effective and to achieve optimum
results in line with the programs targets.
The main target of the Partnership Program is the creation of independent
economies for marginal communities. Through this program, Telkom seeks
to explore and develop economic competencies for marginal communities
in the vicinity of the Companys regional operations, which are spread
with its suppliers, contractors

and other partners will result in
a positive contribution for the
development of the national and
regional economies. Therefore,
Telkom seeks to have good
short and long-term working
relationships with its suppliers of
goods and services by improving
the quality of relationships
through the application of basic
procurement principles that are
efficient, effective, open and
competitive, transparent, nondiscriminative and accountable.
These principles are applied
to ensure the quality and
accountability of the supply of
goods and services to other
stakeholders, especially customers.
Ensuring the quality of goods and
services, especially maintenance
services, will improve transmission
quality and the interconnection
level between networks, thus
increasing the percentage of
successful telecommunication
connections and data
transmissions.
44

2013 Sustainability
Performance
Overview
About Telkom
About
This Report
Economic
Growth
Telkom Shares
G4-SO1 | G4-EC8
Telkom implements community
economic empowerment programs
through three main activities aimed
at helping increase the competence
of Development Partners engaged
in small and medium enterprises
and cooperatives, namely;
(1) the provision of soft loans;
(2) entrepreneurship training;
and (3) creativity development.
Increased competence is prioritized
in areas that support business
activities, including: the basics
of bookkeeping, opening of
markets, production management
Considering that Telkoms
goods and services is maintained,
operations cover the whole of
economic and prompt. For small
Indonesia and are required to
value contracts (under Rp25
provide services 24 hours a day,
million), Telkom prioritizes local
every day, high quality relationships
partners for efficiency and to
with suppliers, contractors and
provide equal work opportunities.
partners will have a positive effect

on the Companys performance.
The application of information

technology-based goods
Telkom selects its work partners
and services procurement
for the procurement of goods and
(e-procurement), which has been
services through a three-stage
implemented since 2005, has
process: Supplier Registration
brought about various benefits,
through the Supply Management
including accelerated processing,
and Logistic Enhancement (SMILE)
fair pricing, fairness, transparency
application. Followed by Supplier
and the prevention of intervention
Selection, involving an assessment
and unwanted actions.
process of the suppliers based on

other criteria to generate ranking
COMMUNITY ECONOMIC
EMPOWERMENT
and a shortlist. Final selection is
The Community Economic
through Eligible Bidder, namely
Empowerment program is a
suppliers with the right to be
sustainability concept from the
or which will be involved in the
economic dimension. Through the
procurement process.
implementation of the Partnership
business classification and several
Program, Telkom seeks to create

Further, Telkom makes periodic
independent micro-business
assessment of partner performance
activity in marginal communities.
to ensure high quality long-term
This program is also in line with
cooperation for both parties.
efforts to alleviate poverty levels
The aim of the assessment is to
and economic disparity, as set out
ensure the procurement of quality
in the 2015 MDGs.
and customer management.

Implementation of this program is
part of the implementation of the
Triple Bottom Line principle.
In its realization, Telkom works to
develop economic independence
in marginal communities, while
creating a digital community
environment through educating
on the optimum use of ICT
applications that support daily
activities and are related to
economic activities.
Funding for this program is set
aside from Telkoms net profit each
year, as determined in the AGM,
with reference to government
regulations, in particular those of
the SOE Ministry. In 2013, funding
for the Partnership Program
amounted to Rp118.2 billion, in
addition to partnership fostering
funding of Rp6.25 billion. The total
funds allocated and distributed
were less than the Rp343.87
billion of 2012. This reduction
was primarily caused by changes
in regulations issued by the SOE
Ministry.
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

With the additional funding in
production and marketing
In 2013, Telkom disbursed
2013, the accumulated funding
supply chain.
Rp6.25 billion to foster
45
Development Partners.
for the Partnership Program from

2001 until the end of 2013 totaled
Through these clusters,
Rp2,003 billion (2012: Rp1,885.25
fostering can be effective,
The training modules run
billion), with a total of 93,746
especially to improve the
during 2013 were fairly
Development Partners (2012: 89,771
development of a prime
complete, covering business
partners).
commodity for a specific area,
motivation, entrepreneurial
the creation of cooperation
management, financial
The targets of this program are
between Development
management and cost analysis,
SMEs, individual and cooperative
Partners, improved
marketing management and
entrepreneurs in several business
togetherness, facilitating
ICT applications in micro
sectors, including: industry, trade,
exchange of knowledge, ease
businesses. Training took
agriculture, husbandry, farming,
of evaluation and supervision
place in several ways, including
fisheries, services and other
of loan use, as well as
face-to-face, training through
sectors.
improved responsibility from
radio media with On-air/Talk
all Development Partners to
Show Training which was
pay back their soft loans.
accessible to Development
1.
Providing Soft Loans
Partners on two radio stations
Disbursing soft loans to

micro-businesses is aimed
In 2013, a total of 3,975
in Bandung, namely K-Lite 107.1
at triggering potential
Development Partners
FM and Zora 90.1 FM. On air
economic growth in the
received soft loans across
training not only accelerates
community and is part of
33 Indonesian provinces.
knowledge improvement, it
the Partnership Program.
The majority, or 2,140, of
also improves the efficiency
In its implementation, we
Development Partners were
and effectiveness of the
prioritize the bottom-up
involved in trade, followed
training programs as
intervention approach with
by 694 in the industry sector
an unlimited number of
the understanding that Telkom
and 688 in the service sector.
Development Partners can
appreciates and recognizes
Meanwhile, the smallest sector
take part without needing
that the lower end of society,
taken up by Development
participants to leave their
as the program target, has
Partners was other sectors,
business activities.
the potential to fulfill its own
with only 11 partners.

Through this training,
needs, solve its own problems

and is able to conduct
2. Improving Entrepreneurial
communication between
Competency
Telkom and its Development
Telkom does not only
Partners can be more active,
To improve effective
provide soft loans, it also
faster and more efficient.
management and supervision,
provides periodic training
Knowledge exchange between
as well as to optimize the
in entrepreneurial skills to
Development Partners can also
results of the Partnership
its Development Partners
be more intensive. The on-air/
Program, Telkom prioritizes
in accordance with need,
talk show program has other
a disbursement pattern
business development and
benefits, in that it can provide
based on clusters of specific
potential. The entrepreneurial
inspiration for SME fostering
businesses. Each cluster
training program takes place in
programs run by the Company,
consists of 10 Development
all Telkoms operational areas,
as well as facilitate the
Partners with the same
with the aim of improving the
selection of new entrepreneur
business location and core
skills of Development Partners
candidates with potential to
business, including businesses
to manage and develop the
become Telkoms Development
that involve the raw materials,
businesses they are running.
Partners.
productive business for itself.
46

2013 Sustainability
Performance
Overview
About Telkom
About
This Report
Economic
Growth
Telkom Shares
INDIPRENEUR MEGA PROJECT

Telkoms commitment to promote the use of TIMES
DARITELKOMINDONESIAUNTUKINDONESIA:
100K UKM GO ONLINE
100KUKMGOONLINE
SSosialisasi
i li i
MegaProject:IndiPreneur
services in business through the IndiPreneur education

program has facilitated SME entrepreneurs to be able to
reach the global market together.
At the end of 2013, no less than 100 thousand SME
business managers had shared their experiences, bringing
together business potential online thanks to the support
GroupHeadEntepriseService
G
H dE
i S i
DirektoratEnterpriseService
2013
of information technology applications packaged based

on need, practicality, economy and ease of access.
Improving Marketing
in cooperation with the
for their products. To achieve
Management
Indonesian Export Training
this, Telkom includes its
As part of the efforts to
and Education Center
Development Partners in SME
create a Digital Society and
(BBPPEI) under the Directorate
Development Partner product
Digital Economy, in line with
General for National Export
exhibitions held both nationally
the increasing amount of
Development at the Trade
and internationally.
online business transactions,
Ministry. The aim of this
Telkom is providing intensive
program remains to enable
In 2013, there were 17 (2012:17)
e-commerce training to its
SME Development Partners
national exhibitions in which
Development Partners to
to run effective export-based
Telkoms Development Partners
enable them to compete
businesses offering a high
took part.
with online media services.
quality to meet overseas
Telkom is serious about
demand.
3. Realizing Creative Economic

Potential
improving the competency

of its Development Partners
In 2013, Telkom ran one class
Telkom is also motivated to realize
related to online service-
(2012: three classes) of its
the development of creative
based business development
coaching program in Semarang
economic potential as part of its
programs and has had good
in which 6 Development
Partnership Program activities.
results. The emergence of
Partners took part (2012:15).
This program relies on uncovering
online-based Development
The coaching material for
creativity within the community
Partner communities
Telkoms SME Development
and pioneering and developing
communicating across
Partners consisted of Preparing
economic and business potential
Indonesia has provided every
Your Business (months 03),
based on the application of TIMES
partner with an extensive
Market Development (months
technology managed by Telkom.
marketing network with
36) and Market Entry (months
The Indigopreneur program
great potential for marketing
6-12).
has been especially designed
cooperation.
for SMEs. They are coached in

National-scale Development
e-commerce, entrepreneurship,
To strengthen the ability of
Partner Product Exhibitions
banking knowledge, IT, imagineering
Development Partners to
As part of the Partnership
mindset, self awareness and
penetrate product markets
Program, Telkom assists its
entrepreneur goal setting, creative
overseas, Telkom is running
Development Partners by
business and platinum track. The
its Coaching Program
opening markets nationally
target of this program is to produce
Telkom Preserves
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People
Telkom
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a mindset that is creative, innovative,
the benefits of IT and the ways of
independent and resilient. During
online marketing.
2013, coaching was provided in
The advantages for SMEs are:
three locations, namely Jakarta,
Introducing SMEs to the

47
facilitate communication
and transactions online.
Instilling understanding and
effective use of IT such that
SMEs can benefit greatly.
Makassar and Surabaya, with a
global arena so it is more
total of 165 participants (2012: 204
familiar and they are able to
participants).
compete with SMEs in other
To change the perception, habits
countries.
and business interaction patterns to
To increase SME sales through
Providing space for
online marketing, training is
interaction between buyers,
provided to improve knowledge of
suppliers and SMEs to
better suit business development

and technology.
PARTNERSHIP Success Stories
Batik Ozzy
Penetrates the
International
Market
Dodol Bestari
Becoming an Inspiration
for Dodol Makers in Garut
If you ask about Garut regencys specialty food,
the answer is sure to be dodol (a chewy sweet).
Where there is a will, there is

a way. This saying illustrates
the life path of Lianawaty
Hidayat, who has had success with a batik
business. Originally, in 1995, a fitness instructor
at Sanggar Ozzy where most of the members
worked with batik, Lianawaty started to learn
a lot. Her persistence and perseverance in
hand-drawn batik had sweet results and inspired
many teenagers and batik entrepreneurs in
Pekalongan.
Lianawatys success in the hand-drawn batik
business is inseparable from the role of the
Telkom Community Development Center
(CDC),which provided the opportunity to
become a Development Partner. As well as
having the opportunity to take part in national
and international exhibitions, as a Telkom
Development Partner, she also received
management and marketing training on the
website. Through this training, Lianawaty
acknowledges her management abilities
improved. By being a Telkom Development
Partner, capital constraints usually faced by
SME businesspeople could be overcome and
sufficient training was provided.
Dodol is the pride of Garut. In fact, Garut is

often known as the town of dodol. Telkoms
role in increasing the independence of SMEs
incorporated the Community Development
Center in the West Java area, which assists in
the production of dodol. Amal Rasyid is one
of the beneficiaries of this assistance. With
his product, Dodol Bestari, Amal Rasyid has
grown his business based on a recipe passed
down from his grandfather.
Since he became a Telkom Development
Partner, he has gained a lot of knowledge, from
financial management training to marketing
both online and offline. Now, the Dodol Bestari
factory, located at Jalan Raya Bayongbong KM
1.5, has 20 employees. Thats not including the
marketing staff, said the man, who is now 37
years old and is often a speaker
in Business
Development
Inspiration
sessions.
48

2013 Sustainability
Performance
Overview
About Telkom
About
This Report
Telkom
Shares
Corporate Social Responsibility Development Strategy
50
Community Empowerment Program
51
Community Development Program
51
Economic
Growth
Telkom Shares
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The Community Development Program is

an important part of the Corporate Social
Responsibility, which we continue to support
increased community welfare
49
50

2013 Sustainability
Performance
Overview
About Telkom
About
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Telkom believes that the success of its Corporate Social Responsibility
Economic
Growth
Telkom Shares
Digital Community
(CSR) is as important as its financial success. This is in accordance with
Supporting community
its awareness that Telkom exists for Indonesia. Improving community
empowerment through
welfare will automatically impact on Telkoms business development
education on the benefits
growth. Meanwhile, Telkoms economic resilience will ultimately be
and optimum uses of ICT
returned to society and other stakeholders.
to facilitate activities in the

communitys daily life.
Telkom is well aware of the meaning of the triple bottom line concept,
Digital Economy
which promulgates that for a company to exist and attain business growth,
Developing ICT facilities for
it must adopt the 3P principle of profit-people-planet. In addition to
various public services used
earning profit, the company must also be actively involved in meeting the
by the community, as well as
welfare needs of the people and contribute to maintaining the environment
providing support for micro,
of the planet.
small and medium enterprises,

in particular in the creative
CORPORATE SOCIAL RESPONSIBILITY DEVELOPMENT

STRATEGY
industry sector and related to

optimizing the use of ICT.
Telkom has compiled and realized a community development strategy for

marginal communities as one form of its corporate social responsibility.
Overall, the three main CSR pillars
The aim is enlightening society, i.e. supporting the advancement of
are then implemented in a variety
welfare in Indonesian communities through the implementation of the three
of programs across 7 (seven)
main pillars of CSR and in line with the principles of triple bottom line,
fields, namely: (1) partnership, (2)
namely:
public services, (3) education, (4)
Digital Environment
health, (5) culture and civilization,
The development, provision and management of telecommunication
(6) environmental conservation,
infrastructure and various Information and Communication Technology
and (7) humanitarian / natural
(ICT) facilities to support and connect all community activities,
disaster aid.
including environmental conservation.
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51
G4-SO1
With reference to the Decree of
the Community Development Center (CD) Unit, which falls under the
the Directors No.KD.21/PR000/
management of the Human Capital and General Affairs Directorate. The
COP-B0030000/2010 and in
CD Unit is located at head office and in regional operational areas.
accordance with applicable

legislation, Telkom has realized
COMMUNITY DEVELOPMENT PROGRAM
7 program initiatives in its
Activities in the Community Development Program (PBL) fall into six
Partnership and Community
fields. All of these are philanthropic activities conducted by Telkom,
Development Program, as well as
such as assistance in education and training, public health, religious
through relevant CSR initiatives
facilities, developing public facilities, aiding victims of natural disasters
related to community development.
and environmental conservation. Telkom emphasizes the growth and

development of a digital community through the realization of its PBL.
A description of all these fields
Therefore, community development funding disbursement is dominated
of activity is presented in three
by funding for education, facility and infrastructure development related to
topics: Community empowerment
education and the growth of a responsible information technology-using
Program, Partnership Program
culture able to support daily activities.
in the chapter Supporting

Economic Growth, and the chapter
To ensure the effectiveness of fund disbursement for PBL activities, both
Participating in Environmental
through Head Office CD and Regional CDs, disbursement is proactive,
Conservation.
active and responsive. Proactive funding is based on an annual work plan

and thematic in nature. Active funding is evaluated and followed up based
community
empowerment program
on proposals submitted by communities or those seeking aid. Meanwhile,
Telkom continues to implement
events / disasters.
responsive funding is action taken for rescue and recovery for certain
a variety of community
empowerment programs in
To ensure the optimum, efficient and effective achievement of the program,
line with government policies
each method of disbursing funds involving communities and the local
on poverty alleviation, the
governments as stakeholders starts with the planning process and runs
development of independent
through to program evaluation.
communities, increased
communities capacity and
The issuance of new regulations from the SOE Ministry regarding Caring
increased corporate participation
SOEs and the implementation of Poverty Alleviation programs caused
in the achievement of the
the PBL budget in 2013 to be capped and its realization to substantially
2015 Millennium Development
change. Funding realized in 2013 as compared to 2012 is shown in the
Goals (MDGs). Community
following table.
empowerment for Telkom

emphasizes the creation of
values to improve the economic,
social and cultural condition
of communities, as well as
empowerment to facilitate
independence.
Community Empowerment Program Funding Disbursement for 2012-2013

Field
2013
(Rp billion)
2012
(Rp billion)
20.96
19.96
5.37
7.80
SOEs programs trustees

Education and training
Public health
The Community empowerment
Religious facilities
13.28
7.21
Program is implemented through
Public facilities
5.54
6.19
the Partnership and Community
Natural disaster victims
Development Program (PK-PBL).

The Community empowerment
Program is implemented by
Environmental conservation
Poverty alleviation
Caring SOEs Program

Total
1.47
1.41
0.50
0.96
6.63
--
--
48.62
53.75
92.14

52
2013 Sustainability
Performance
Overview
About Telkom
About
This Report
Total funds, excluding operational costs, amounted to Rp2.01 billion, thus

total disbursement of funds amounted to Rp55.76 billion.
Economic
Growth
Telkom Shares
In 2013, this training was

focused on developing
competence in IT usage to
Education and Training Program
facilitate the teaching of
As manifestation of its commitment to develop competent Indonesian
students in junior and senior
children, Telkom has allocated the highest proportion of its PBL assistance
high school. The training
to education and training. In 2013, Telkom disbursed Rp20.96 billion to
program was provided for junior
education and training, 39% of total program costs. This is an increase of
and senior high school teachers
5% on the previous year, which totaled Rp19.96 billion.
in six cities (Banyuwangi,

Kendari, Banjarmasin, Kudus,
This program is intended to demonstrate Telkoms active participation in
Bukit Tinggi and Mataram)
improving the quality of education, its assistance in providing satisfactory
and utilized material on IT
educational facilities and the provision of opportunities for marginal
knowledge, public speaking,
communities to have access to equal standards of education. These
writing and emotional spiritual
education and training activities are developments of old programs,

consisting of: (1) Dedicated to My Teachers, (2) Scholarship Program,
quotient/ESQ.
(2) Scholarship Program
(3) Remote Village Internet Education, (4) Bandung Knowledge Cloud,
Differing from other
(5) Integrated Digital School, (6) Edu Campus Development School, (7)
scholarship programs run
Assistance for National Sports Achievement, and (8) Indonesia Digital
by Telkom, this scholarship
School.
program has no official ties.
(1). Dedicated to My Teachers
The Scholarship Program is
Based on the belief that teachers spearhead the intelligence of a nation,
offered in cooperation with a
Telkom has been implementing a teacher training program for the last
university in Jakarta and Telkom
7 years. The ultimate goal of the program is to improve the quality of
provides the scholarships to
education in Indonesia. The aim of training the teachers themselves is:
students with high academic
making teachers the agents of change in Indonesias education
achievement who are
world;
economically disadvantaged.
improving teachers understanding of ICT; and
maximizing the community of teachers who have received training.
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53
non-academic abilities for
The IndiSchool program is also
Villages
undergraduate students
intended to help reduce the gap
In this program, the Telkom
entering the job market.
in education quality between
team visited disadvantaged
The program includes training
schools in urban areas and
villages in remote areas and
in internationally certified
those located in Indonesias
assisted them by expanding
operation systems such as
backward regions, outermost
local knowledge, especially
Adobe Certified Associate
islands, and border regions.
that of the younger generation,
(ACA), Microsoft Office
This is achieved by installing
to enable them to follow
Specialist (MOS) and Microsoft
VSAT (Very Small Aperture
developments with the most
Technology Associate (MTA)
Terminal) with parabolic
up-to-date information
with online testing. In 2013,
antenna equipment to provide
technology. The education
the ECDC program had
internet access.
team visited these villages
2,000 participants from
in vehicles equipped with
five Indonesian universities:
The IndiSchool Program targets
computer equipment and
Bandung Institute of
installing Wi-Fi equipment for
wireless internet access. In
Technology (ITB), Surabaya
internet broadband access
2013, these activities were
Institute of Technology (ITS),
in 100,000 schools across
focused around several areas
North Sumatera University
Indonesia. As of end 2013,
in the provinces of Banten and
(USU), Mulawarman University
Telkom had rolled out Wi-Fi
West Java.
(Unmul) Samarinda and
internet access points in 17,845
Diponegoro University (Undip)
schools across the country.
(3) Internet Education for Remote
(4) Bandung Knowledge Cloud

This program has
been implemented in
Semarang.
(7) Assistance for National Sports
Construction of Community
cooperation with the ITB
Achievement
Religious Facilities
Institute of Innovation and
Funding has been provided
Telkom also participates in
Entrepreneurship Development
to run try-outs and to prepare
improving the quality of religious
(LPIK). Bandung Knowledge
the golf team for the 2013
life in Indonesia by providing
Cloud (BKC) is a repository
SEA Games 2013 in Myanmar.
assistance to construct and repair
of knowledge developed by
Additionally, there was multi-
religious facilities, such as mosques,
teachers and available for use
event cooperation between
churches and places of worship for
by all students to improve the
Telkom and the Indonesia
other religions.
quality of education nationally.
National Sports Committee
One initiative following the
(KONI) to coach cycling
The construction of religious
BKC program has been the
athletes joining the 2013 SEA
facilities and infrastructure will
formation of a Digital Teacher
Games, 2014 Asian Games,
increase religious activities within
Community forum.
2015 SEA Games and the 2016
communities and improve social
Olympics, and so forth.
behavior. In 2013, construction
(5) Integrated Digital School

This is an education-based
(8) Indonesia Digital School
of several religious facilities took
CSR program by Telkomsel and
(IndiSchool)
place, including:
provides educational support
In the IndiSchool program,
Construction of An-Nahl Islamic
facilities that apply DNA
Telkom has built internet
(device-network-application)
broadband facilities in schools
technology for school
in the attempt to Develop
communities. The program
a Smart Indonesia through
Education Center in Cibodas,
was introduced in 2012, and in
ICT support. By providing
Tangerang, Banten;
2013 was expanded to reach
better internet access at
25 schools in Central Java,
affordable rates to facilitate
Reading Center in Bantar
Yogyakarta, East Java and Bali.
the availability of educational
Gebang, Bekasi, West Java;
(6) Edu Campus Development
content, it is hoped that the
Center (ECDC)
quality of teaching and learning
This is also a Telkomsel
will improve for students and
program, aimed at providing
teachers.
boarding school in Leuwiliang,

Bogor province, West Java;
Construction of Al-Quran
Construction of Al-Quran
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2013 Sustainability
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Economic
Growth
Telkom Shares
G4-EC7
district, Ngawi regency, and
government or non-profit
Toraja, Papua,Simalungun and
at Jambu hamlet, Sedayu
organizations working together
Toba-Samosir;
village, Arjosari district, Pacitan
with Telkom. To ensure the
regency, both in East Java
optimum positive impact
province.
for the public, Telkom first
Construction of churches in
Construction of mosques in
various areas; and
Construction of Ponpes Tahfidz
(2) Broadband Learning Center
Tanbihul Ghofilin dormitory in

Cibinong, Bogor, West Java.
conducts a need assessment
(BLC).
on every proposal submitted
BLC is an activity implemented
by the regional government or
to expand community access
community organization.
Development of Public Facilities
to the TIMES facilities we
and Infrastructure
manage and takes the form of
Some of the assistance for
The purpose of this program is to
establishing internet access.
public facilities during 2013
The role of BLC at this time is:
included:
as a training location for
aid to build/renovate schools
improve public services related to

telecommunication facilities and
infrastructure. This program is
internet basics;
in Deli Serdang, Jakarta,

Bekasi, Bogor, Bandung,
expected to be able to improve
as a means to educate the
efficiency for the public in their
public through internet
Ciparay, Rancaekek,
training; and
Sukabumi, Bojonegoro,
activities, to facilitate activities that

can be supported by information
as a means to educate SME
Pontianak, Balikpapan,
Singaraja and Atambua;
technology, including supporting
businesspeople, especially
marketing and product distribution
Telkoms Development
for small, medium and large-scale
Partners, where SME
industries.
businesspeople are trained
facilities in Jakarta, Bandung,
to create blogs and to
Garut, Banjarmasin and
Activities that have taken
market their products online
Palangkaraya;
place include: the Community
through the internet.
aid to build public bathing,

washing and toilet (MCK)
renovation of sports fields,

repairing roads/drains,
Independent Electricity Program,

Broadband Learning Center (BLC)
Telkom has established BLC in a
providing clean water,
Program, assistance building public
number of locations, including
improving community
facilities and Bungkul Park.
Banda Aceh, Greater Aceh,
security centers and such
(1) Community Independent
Lubuk Linggau, Pekanbaru,
like in various areas.
Electricity Program.
Yogyakarta, Klaten, Salatiga,
This program aims to help
Kendal, Jepara, Surabaya,
accelerate the national
Malang, Banyuwangi, Pontianak,
Located on Jl. Raya Darmo in
electrification program to bring
Kapuas Hulu, Kendari, Tana
Surabaya, Bungkul Park was
electricity to areas not yet
Toraja and Abepura.
previously a slum. In 2007,

the area started to undergo
served by the PLN electricity

grid, using a simple pico-
(4) Bungkul Park
(3) Assistance Constructing Public
renovation with funding from
power technology that is easily
Facilities
the Community Development
implemented independently by
This assistance is provided as
Program amounting to Rp1.2
local communities. 2013 was
participation in the construction
billion. Post renovation, the
the first year of this program,
of facilities and infrastructure
1,400 m2 area has now become
which was conducted at two
used by the public in general.
a public park in the middle of
locations, namely Dampit
Construction can be under
Surabaya and is equipped with
hamlet, Dampit village, Bringin
the initiative of the local
a skateboard area, BMX track,
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55
Natural Disaster Aid

Telkom continues to participate
in efforts to alleviate the suffering
of victims of natural disaster
occurring in Indonesia, both for
at the time of disaster and postdisaster. Programs and activities
aiding victims of natural disasters
have seen direct aid from Telkom
and the Telkom Group through the
Telkom Cares Program.
The aid provided comprises
staple goods and public kitchens,
medication and the establishment
of health command posts, free
jogging track, open stage area for live performances and a green park.
Telkom has also provided public telephones and a free Wi-Fi network in
the park.
Now Bungkul Park has become a tourist spot and is a popular place
for many of Surabayas residents, as well as out-of-town visitors to the
city. Bungkul Park is primarily busy in the evening, with many visitors
enjoying the various recreational facilities, including culinary delights.
Bungkul Park has been recognized in the in the annual Asian Townscape
Award (ATA), receiving the Asian Townscape Sector Award 2013.
Improving Public Health
Telkom facilitates the provision of improved public health services
through cooperation with various parties in the health sector. In
2013, Telkom provided public services to travelers during the annual
Lebaran season in cooperation with STIKES Dharma Husada Bandung
by establishing Healthcare Command Center facilities at six locations
prone to traffic accidents, namely Cikalong Wetan, Rajamandala, Cagak
Subang Road, Patok Beusi, Puskanagara and Limbangan, Garut. With 130
personnel, these facilities operated from Day-5 (3 August 2013) to Day+1
(10 August 2013).
Other initiatives included blood donor drives in Bandung, Jember,
Surabaya, Jakarta and Medan; mass circumcision programs; improved
nutrition and maternal health clinics, as well as the provision of leg
prostheses.
MCK areas.
In 2013, Telkom provided postdisaster relief, including:
- aid for refugees from the
Gunung Sinabung eruption in
September 2013;
- aid for flood victims in several
regions, such as Jabodetabek,
Pekalongan, Sukoharjo,
Bojonegoro, Sampang Madura
and Kendari;
- disaster response for the Aceh
earthquake Aceh. A Crisis
Management Team (CMT) was
set up to handle the impact
of the Aceh earthquake,
including health command
posts to channel aid to
victims, and safeguarding and
repairing telecommunication
infrastructure damaged in the
event; and
- Telkomsel, a subsidiary of
Telkom, also operates the
TERRA (Telkomsel Emergency
56

2013 Sustainability
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Overview
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Response and Recovery Activity) program for emergency response
Economic
Growth
Telkom Shares
CSR Bahari
at times of natural disaster in Indonesia. In 2013, the TERRA program
Telkomsel, a subsidiary of
was involved in the Aceh earthquake response, relief for the flooding in
Telkom, runs the CSR Bahari
Ambon and the eruption of Gunung Sinabung.
program to participate in efforts

to conserve the marine and
Environmental Conservation Program
beach environment in Indonesia.
Telkom has also actively participated in greening and environmental
Activities include planting
conservation programs at its own initiative and in cooperation with
coral fragments and cleaning
community organizations. Several environmental activities undertaken in
beach areas, as well as assisting
2013 have included:
with cellular communication

facilities for Indonesian Armed
Go Green Smile
Forces personnel assigned to
This demonstrates Telkoms care for the environment through the
these locations, as well as local
following activities:
fishermen.
- beach cleaning on Pulau Pramuka, Thousand Islands, to reduce

pollution resulting from approximately 100 tons of trash per day
The CSR Bahari program had its
from Jakarta thrown into the waters off the Thousand Islands;
first event on 28 October 2013,
- planting 15,000 mangrove seedlings in Kampung Garapan, Desa
Youth Pledge Day in Indonesia,
Tanjung Pasir, Tangerang on 8 June 2013;
in four locations: Pulau Weh,
- creation of a Green Belt to minimize coastal abrasion in Indramayu;
Pulau Biak, Pulau Sangihe and
- tree planting/greening in Bandar Lampung, Makassar, and along the
Pulau Maumere, which are four
riverbanks in Bengawan Solo, Jember and Madura;

- creation of biopore holes in Bogor and Bandung.
of Indonesias outer islands.

Through the event, Telkomsel
wished to portray that through
These activities have all involved school/university students, lovers of
telecommunication services we
the environment and local communities.
can unify the nation.
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Biopore Day
Environmental Care from Telkom

To participate in reducing the water debit during the rainy season, Telkom CorpU took the initiative to create
biopore holes to absorb rain water back into the ground in its Telkom CorpU Gegerkalong Hilir Bandung
grounds on Friday, 15 February. The Biopore Day Program was part of the GO Green program initiated in 2012
on the Bandung campus and outside Bandung. The event involved all the senior leaders and employees of
Telkom CorpU that work in Bandung.
The biopore holes are made with a standard 10-30 cm diameter and a depth of 30100 cm and filled with
organic refuse to absorb water into the ground and create natural compost. The activity taking place at
Telkom CorpU to demonstrate environmental care saw the creation of 196 biopore holes.
Additional Go Green activities involved separating organic and non-organic trash, managing organic waste to
create compost, planting trees or appropriate plants, the use of environmentally friendly air conditioning and
the use of solar cells to power street lighting.
The Go Green programs being run at Telkom CorpU are expected to inspire other units and local communities
to act wisely with regard to the environment and to implement similar programs. Whether it is realized
or not, what has been, is being and will be done to the environment is part of Telkoms Corporate Social
Responsibility (CSR) program.
57
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2013 Sustainability
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Economic
Growth
Telkom Shares
Building a Digital Society in Banyuwangi

Thanks to internet technology supported by PT Telekomunikasi Indonesia (Telkom), the Banyuwangi area has
become known for changing from a mystical region to one of the most modern regencies in Indonesia. This
is hardly surprising, as since mid-2012, Telkom, with the support of the Banyuwangi local government, has
rolled out a variety of facilities and infrastructures to make the area into one of Indonesias leading regencies
through the creation of a digital society. This was marked by the grand launching of the Banyuwangi Digital
Society (Banyuwangi DiSo) at the Tawang Alun Tennis Sports Ground, Banyuwangi, East Java on 9 March
2013, which was attended by the Communications and Information Minister, Tifatul Sembiring.
According to Tifatul, equalizing internet access across the easternmost tip of Java had driven Banyuwangis
economic growth. People will not have to come to the city to look for work because they can find everything
on the internet, he said at the launch of the Banyuwangi Digital Society. This is all thanks to Telkoms support,
which has resulted in Banyuwangi currently having 1,100 Wi-Fi access points from a targeted 10,000 Wi-Fi
points by 2014. Telkom has already prepared content to facilitate public services. Expanding the reach of the
internet in Banyuwangi is expected to increase more even use of the internet in Indonesia.
As already highlighted by the world economy, by 2025 Indonesia will be one of the 12 largest countries in the
world and by 2045, one of the 8 largest, said Tifatul.
Tifatul added that regional heads could clearly see and take advantage of opportunities to win, including
making use of the functions and benefits of a digital society. A digital society would push the creation of
the Indonesia Digital Network (IDN), Telkoms largest program, by 2014, and realize the Acceleration and
Expansion for Indonesian Economic Development Master Plan (MP3EI).
At the same time as the launch of the IndiGov Banyuwangi services, the inaugural committee volunteers for
the East Java Information and Communication Technology provided digital media training for journalism
school involving 250 students from 100 schools and kicked off www.ilovebanyuwangi.com. For the IndiGov
services, Banyuwangi is ready to implement bureaucratic transformation of the government.
A digital society like Banyuwangi is expected to be copied in other cities in East Java, such that in future
there will be an East Java Digital Society. Telkom has prepared supporting content applications, such as
e-Government, e-Education, e-Health and e-BAZ (Badan Amil Zakat charitable donations).
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Two Telkom Cares Teams Search the Aceh

Earthquake Area
The Telkom Group Cares Team for the Aceh Earthquake Searched the Disaster Area in Bener Meriah regency
and Central Aceh on Friday, 5 July. The search took place at the same time that aid was handed over to
survivors. Telkom Cares handed over Rp100 million worth of aid such as blankets, torches, tents and various
other basic needs.
The aid was handed over by Aceh Regional GM Mukhni to local government official Bener Meriah T. Islan at
the Main Command Center. Mukhni also conveyed Telkoms deepest condolences for the disaster. Meanwhile,
Bener Meriah expressed his appreciation of Tekoms management for their care for the survivors of the
disaster and said he would quickly distribute the aid.
The two Telkom Cares teams saw one originating from Banda Aceh, which joined with the Aceh Regional
Management, Kakandatel Lhokseumawe and DPD Sekar Aceh local government. While the second
team originated from Medan and consisted of CDC Sumatra Area, SAS Sumatera Area and Sumatera
Communication Regional.
The first team searched for Telkoms employees, retirees and business partners, such as Cleaning Service,
Security and POJ personnel, while the second team handed over aid to the Main Command Center.
Having completed its primary task of handing over aid, the second team searched the disaster location
alongside two local reporters (from Waspada Daily newspaper and RRI Takengon national radio station). The
team successfully managed to get to a location that had been out of reach. Due to the severity of the Central
Aceh Bener Meriah earthquake, with a 6.2 magnitude, the damage was significant. Public facilities, such as
roads, mosques, schools and community health centers, as well as homes, were destroyed.
Notes at the Command Center in the field recorded 234 schools as being destroyed, dozens of mosques,
while three villages had to be relocated as they had been inundated by landslides.
We pray that this disaster can be quickly managed, said SAS Sumatera Area Manager Erwan H. Bakri when
interviewed on RRI Takengon radio.
At the disaster site, in Blangmancung village, Ketol regency, Central
Aceh, one public service command center
provides free telephone services to
survivors.
***Syaiful Hadi - Medan_red08 and 750
packets of aid for flood victims in Rangkas
Bitung.
59
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Environmental
Conservation
Environmental Impact of Telkoms Activities
62
Implications, Risks and Business Opportunities

Related to Climate Change
62
Participation in Environmental Conservation
63
Fostering a Healthy and Environmentally

Friendly Culture
66
Supporting Environmentally Friendly Economic 66

Activities
Participation in Greening Activities
67
Environmental Costs and Awards
67
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

Telkom continues to participate in

environmental conservation, formulating
various strategic policies aimed at managing
climate change by mitigating greenhouse gas
emissions and increasing awareness and an
environmentally friendly attitude
61
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Telkom Shares
G4-EC2
As part of its manifestation of the triple bottom line philosophy that
includes disruption of biodiversity
serves as a point of reference to execute its corporate social responsibility,
and water sources during
Telkom always strives to balance its financial performance over the last
construction at work sites. Telkom
few years with similarly successful performance in social welfare and
has a policy to avoid establishing
environmental conservation. Telkom believes that sustainability from the
supporting facilities in protected
environmental dimension means to maintain the continuity of the planet
forests and other protected areas.
and all its contents for future generations. Maintaining the continuity of
To build BTS towers in forest areas,
the planet and all its contents means safeguarding and maintaining the
Telkom applies firm procedures
living environment, which should take place through the participation of all
and policies to avoid disturbing
parties and all types of business.
protected species, especially any

listed on the IUCN Red List. All
The implementation of environmental responsibility by all corporations
such facilities are built only once in
operating in Indonesia is mandated by Article 1 paragraph (3) of Law
a specific time period of between
No. 40/2007 concerning Limited Liability Companies, which states:
10 and 30 years, such that the
Corporate social and environmental responsibility is an expression of
impact on biodiversity and water
the Companys commitment to participating in sustainable economic
sources in an area is minimal.
development to improve quality of life and preserve the environment for

the benefit of the Company itself, the community among which it operates
Meanwhile, the environmental
and society as a whole.
impact from operational activities

includes:
In 2012, the government then issued Government Regulation No. 47/2012
1. Emissions from transportation
concerning Social and Environmental Responsibility as guidance in the
used for operational purposes
implementation of Article 1 paragraph (3) of Law No. 40/2007.
and the use of electricity
Telkoms commitment to conserving the environment is contained in
generators for BTS towers in
Circular No. ED.130/PS000/SDM-20/2008 concerning Efficiency Steps
remote areas that are not yet on
to Preserve the Environment of PT Telekomunikasi Indonesia Tbk, and is

implemented through various programs within the company environment,
as well as within society.
the electric grid;

2. Waste and trash generated by
operational activities, as well as
toxic waste from operational
The application of this policy is manifested through various programs
activities, such as used batteries
internally implemented by Telkom, as well as those run with communities.
and electricity generator
To ensure programs are implemented in accordance with the policy and to
lubricants;
understand how far the target has been achieved, Telkom assigns a relevant
work unit to monitor and assess the program, and then to report on this to
the management.
3. Greenhouse gas emissions from

the use of electrical equipment;
and
4. Water used for domestic
ENVIRONMENTAL IMPACT FROM TELKOM ACTIVITIES
requirements in the head office
While having a relatively minimal impact compared to other companies of
and other offices.
a similar economic scale, Telkoms activities to manage fixed wireless and

wireless telecommunication networks, as well as to provide information
technology services and media edutainment content developed in line with
the TIMES business portfolio, overall has an impact on the environment in
the vicinity.
IMPLICATIONS, RISKS AND

BUSINESS OPPORTUNITIES
FOR TELKOM RESULTING
FROM CLIMATE CHANGE
Climate change is taking place
The main activities and material use that impact on the environment
globally and has the potential
include building land and sea telecommunication facilities and
to directly affect our business
infrastructure, such as base transceiver stations (BTS), installing submarine
operations and poses the risk
telecommunication cables, and building customer service offices in all
of damage to or interference
operational areas. The potential for environmental impact, while minimal,
with various telecommunication

devices and infrastructure. This
Telkom Preserves
the Environment
Telkoms
People
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Governance
Prioritizing
Customers
GRI G4
Core Index

63
G4-EN3 | G4-EN6 | G4-EN15 | G4-EN19
could reduce the quality of

telecommunication services,
including but not limited to
interference with transmission
range and poor telecommunication
signals that affect customer
satisfaction. Furthermore, such
disruptions have the potential to
reduce the number of customers
in the long run, which would
ultimately reduce revenue.
To prevent this, Telkom continues
to innovate and invest in
implementing cutting-edge
technology in the construction,
operation and maintenance of
infrastructure. This, of course,
gives rise to financial implications
as the required investment is not
small to ensure business continuity.
On the other hand, the current
reliability of telecommunication
facilities and infrastructure is
now able to support customer
activities, both for communicating
and conducting business through
the utilization of information
technology-based applications.
Various office activities can
now be done through remote
interaction between individuals
and groups with the support of
teleconferencing, internet and
Wi-Fi applications.
Of course, this will have a positive
influence and create opportunities
to win an increasing number of
customers while also increasing
utilization of telecommunication
services provided by Telkom. In
the end, this would contribute to
an increase in revenue that would
safeguard the sustainability of the
company.
Response to Climate Change
1. Participation in Carbon Gas
Given the impact of climate
Emissions (G4-EN3, G4-EN6,
change can affect all aspects of
G4-EN15, G4-EN19)
life, social and economic, Telkom
Telkom has not yet specifically
strives to take part in movements,
calculated its carbon footprint
alongside citizens of the world,
for its entire operations. The
to jointly mitigate the causes
use of electrical energy and
of climate change. In response
fuel for operational vehicles
and to participate in efforts to
cannot yet be calculated and
tackle global climate change
presented in detail. However,
made by the world community,
since 2009, Telkom has
Telkom is trying to mitigate the
conducted a series of targeted
environmental impact of the
and consistent initiatives
companys operations. This is
to reduce electrical energy
manifested, among others, by
consumption in operations.
applying environmentally friendly
Thus, Telkom contributed
operational policies.
to the mitigation of carbon
PARTICIPATING IN EFFORTS
TO CONSERVE THE
ENVIRONMENT
electricity generated
Telkom participates in efforts to
and oil) is a source of carbon
conserve the environment through
emissions released into the
an environmental program called
atmosphere. In practice, efforts
Telkom Go Green Action, which
to mitigate carbon emissions
includes mitigation of carbon
are realized through the
emissions, energy efficient office
implementation of strategies
buildings, BTS energy efficiency,
for high-efficiency equipment
use of renewable energy, the
and new technologies that are
paperless office concept, waste
more environmentally friendly,
management, water management

and recycling, bike to work
emissions (CO2), considering

from power plants using
conventional fossil fuels (coal
such as:
- using AC with inverter
movement and earth hour. As
technology, retrofitting fluid
per the main objective of all these
and thermodynamic systems
activities, Telkoms participation
in AC with Articmaster, as
is grouped into the programs

described below.
64

well as replacing Freon with
2013 Sustainability
Performance
Overview
About Telkom
About
This Report
- use of capacitor banks
Telkom Shares
technology based on
to improve power factor
building automation systems
to comply with PLN
(BAS) to gain operational
LED, which have an electricity
stipulations on KVAR limits
efficiency for operators and
efficiency of up to 90%;
and reduce the wasteful
make use of environmentally
hydrocarbon refrigerants;
- replacing TL light bulbs with
use of electricity due to
- installing capacitor banks in our
capacitive loads.
STOs to reduce wasted energy

friendly refrigerant;
- application of a focused and
In 2013, Telkom
accurate lighting operation
implemented a series of
schedule with appropriate
from TDM switches to soft-
trials in collaboration with
equipment to reduce wasted
switch software, which uses
PT Chandra Excelindo
electricity without disrupting
less electricity, expends less
Majesty (Top Saver 2000
the comfort and security of
heat and takes up less physical
brand holder) and has
building occupants;
space;
implemented the use of Top
due to reactive power;

- replacing switching equipment
- implementation of
Saver for its non inverter
ongoing and continuous
from the linear-mode to
equipment to suppress
dissemination to all building
switch-mode type, which uses
losses due to use of electric
occupants about energy
less energy and has a higher
current. This program will
savings, including placing
conversion efficiency;
continue in the coming
warning signs and stickers
years.
in various strategic locations
- replacing rectifier equipment
- building and operating a green

data center that prioritizes zero
- installed reflective glass
to remind employees to save
depletion refrigerants (no CFC),
with a thickness of 6 mm to
zero depletion FAP (N2 100%
reduce incoming heat and
- use of lighting zoning to
natural gas), environmentally
make more efficient use of
improve energy efficient
friendly materials (lead free),
ACs.
utilization by differentiating
electricity and water;
In 2013, in cooperation with
between lighting areas
lights and cooling system
PT Sadean Energi Indonesia
based on need to save
management).
as the holder of the Reflecto
and energy saving (LED
Coating for Buildings

Economic
Growth
energy;
- installation of timers to light
As well as supporting efforts
brand, a series of tests was
to mitigate carbon emissions,
undertaken to study the
these various initiatives to save
effect of the coating on the
Significant energy savings
electricity have also impacted
outer side of the building
also come from the use of
on reducing operational costs
walls/windows and that
outdoor BTS at all Telkom Flexi
and maintenance, as well as
functions to allow light
and Telkomsel BTS locations.
reduced the down time of
through while reducing/
Outdoor BTS are smaller than
equipment due to the failure of
stopping the heat passing
indoor ones and do not require
through;
housing and cooling.
air cooling systems.

2. Energy Efficiency in Office
- replacing conventional
the outside of the building.

3. Energy Efficient BTS
With 3,996 outdoor BTS,
Buildings
lighting with LED lighting
within a one-year period,
Telkom is working to improve
that can reduce energy
Telkom managed to make
efficiencies in electricity use
use and is environmentally
approximately 30% energy
through the application of
friendly as it does not
savings from initial requirements
more efficient energy systems
contain mercury;
due to the reduced need for
in office buildings. Various

strategic steps taken include:
- retrofitting AC chillers with

modern, energy-saving
cooling, which was worth Rp48

billion.
Telkom Preserves
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65
4. Use of Renewable Energy
has continued to reduce and
such waste. Toxic waste
Telkom realizes significant
Telkom has thus been able to
is that which comes from
carbon emission mitigation
reduce the amount of paper
supporting activities, such as
by implementing changes to
waste.
from regular oil changes for
energy consumption patterns,
At this time, all Telkom units use
operational vehicles and BTS
from non-renewable to
the online memo application to
generators, bearing in mind that
renewable energy including
send internal memos. During
Telkoms primary operations
solar, water and wind energy.
2013, a total of 221,286 online
do not produce such waste.
Although small in scale, Telkom
memos were created across
Operational vehicles are leased
has started implementing a
all units. Assuming that on
and the oil waste is managed
carbon free concept for some
average one memo consists
in a package provided by the
of its operations. By using solar
of 2 pages and is addressed
leaser.
cells to power base stations,
to three recipients, further
To ensure the responsible
carbon emissions can be can be
forwarded by each person
management and handling
reduced by up to 961.39 tons of
to three more people, with
of waste, Telkom routinely
CO2 each year.
each then forwarded to a
monitors the situation to reduce
Telkomsel has became a pioneer
further three people, then
irresponsible waste disposal.
in the use of renewable energy
it can be calculated that
Telkom also responsibly
in its BTS, using solar and
221,286 documents x 2 pages
manages and disposes of waste
micro-hydro energy, and low
x 3 recipients x 3 forwards is
from all office operations.

7. Waste and Water Recycling
power consumption, and has
equivalent to 3,983,148 sheets
thousands of environmentally
of paper, or equivalent to a
Telkom realizes the importance
friendly BTS operating.
saving of 7,966 reams of paper.
of the role of water in
Renewable energy is also used
Telkom is also working to
supporting human life and all
in locations on islands and
educate its employees and
life on Earth. Water is vital
urban areas still using 7x24
customers to apply this
for the sustainability of life
hour generators, including using
concept, including by issuing
and plays an important role
hybrid energy power plants that
electronic bills, providing bill
in maintaining ecosystems. In
combine solar cells and wind
payment services focused
this regard, we are strongly
power. The use of renewable
through tellers, ATM machines,
committed to be responsible
energy from hybrid power
phone banking, internet
for water use and management.
plants is expected to achieve
banking, mobile banking and
Our relatively low consumption
savings in electricity usage,
auto debit.
of water for building operations
maintenance requirements and
6. Waste and Toxic Waste
and drinking purposes is
up to 98% fuel consumption,
Management
primarily supplied by the
with 2% of fuel still required for
Management of domestic
Regional Water Company
generator maintenance.
waste from Telkoms operations
(PDAM). We have taken
is in cooperation with the
strategic steps to manage water
Through the application in
local Health Department. Dry
by making biopore holes and
several units of online memos
waste that can be recycled,
reservoirs around the office
since 1998, and now with
such as used batteries,
building to collect rain water,
its national implementation,
copper wiring and metal, is
and we recycle water using
the Telkom management
passed on to reputable third
simple charcoal-based filtration.
has produced a policy to
parties. Meanwhile, toxic
Recycled water is used to
significantly reduce the budget
waste is managed by a third
wash operational vehicles and
to purchase paper. Paper use
party authorized to handle
water plants around the office
5. Paperless Office Concept
building.
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A HEALTHY AND
ENVIRONMENTALLY
FRIENDLY CULTURE
SUPPORTING
ENVIRONMENTALLY
FRIENDLY ECONOMIES
Paperless offices are also being
Telkoms participation in protecting
Telkom believes in the huge
use of e-procurement applications
the environment through
potential of information
that also provide the benefit
community activities is not
technology use to support
of time efficiency and effective
confined to its various programs
more environmentally friendly
assessment of potential partners
related to physical environment.
economic activities. In response
or vendors/suppliers of the
Telkom also seeks to educate
to market demand for information
necessary goods and services. This
its own employees, as well as
technology-based product, content
application also has the additional
the public, to become used to
and service packages capable
benefits of obtaining competitive
a healthy and environmentally
of supporting environmentally
prices, maintaining quality and
friendly lifestyle. Some educational
friendly economic activities, Telkom
improved corporate image from
activities have been conducted
continues to increase bandwidth.
good governance application,
through event sponsorship
This is done to support internet
especially in terms of transparency
organized either by third parties or
transmission speeds, both Wi-Fi
and support for the eradication of
directly by Telkom.
and fixed wireless. The successful
collusion, corruption and nepotism.
applied in a variety of medium to

large scale enterprises through the
application of internal business

operation applications, such as the
Telkom supports the development
In the interest of living a healthy
paperless office, teleconferencing
of the Small Office Home Office
life, while also mitigating
and other business operations
(SOHO) concept, which combines
carbon emissions, Telkom
supported by online services, has
business activities in the home.
urges its employees to cycle
been followed by the development
This also requires the support
to work every Friday. This
of information technology-based
of satisfactory information
appeal was issued in 2009 and
product packages for corporate
technology. To support the
continues to be well accepted
customers, both small and large
development of this more
by most employees until
scale.
environmentally friendly economic
1. Bike to Work
activity, Telkom had developed
2013. Telkom expects this will

become an entrenched habit
Various support packages of
a variety of applications that
for its employees and part
products, content and services
facilitate communication, ordering
of a national Bike to Work
in line with the TIMES business
and administration online so that
movement.
portfolio are constantly being
operational matters are increasingly
developed to make the paperless
efficient.
2. Earth Hour
office concept increasingly more
Telkom routinely participates
beneficial for corporate customers,
Telkom expects that some of its
in Earth Hour, as promoted
both large and small, including
TIMES-based service content,
annually by WWF, with the aim
government agencies. Customers
which has been specifically
of benefiting the environment
engaged in the banking sector
developed, will become more
and reducing electricity
have implemented paperless
popular and the first choice for
consumption. This activity sees
office systems through the use
increasingly environmentally
participants choose to switch
of various, now commonly seen,
friendly economic activities.
off their electrical appliances for
online applications for credit card
Economic activities that prioritize
one hour on the fourth Saturday
bills, telephone bills, electricity bills,
the paperless office concept
of March each year from 8.30-
account information, and such like.
are able to reduce logistical
9.30 pm.
Telkom Preserves
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67
- participation in the national
requirements, such as sending
community development programs,
documents, printing bills on paper
as part of the environmental aspect
regreening programs, including
and other physical things. This all
of the companys CSR. Some of
participation in the One Billion
leads to a reduced requirement for
the main reforestation / greening
Trees in Indonesia movement;
fuel and paper, which also leads to
activities have included:
reduced emissions and supports
- planting 15,000 mangrove trees
the environment.
in Kampung Garapan, Desa

Tanjung Pasir, Tangerang on 8
PARTICIPATING IN
REFORESTATION
June 2013
- creating a Green Belt to
As one of its strong commitments
minimize coastal abrasion in
to conservation, Telkom
Indramayu
consistently realizes a variety of
- planting trees / regreening in
- revitalization of parks, greening

pedestrian streets and public
facilities;
- educating and realizing
greening programs in all offices
and in their vicinities;
- implementing reforesting/
greening programs as part of
Community Development.
activities with local communities
Bandar Lampung, Makassar,
aimed at building awareness
the Bengawan Solo river bank,
Alongside these environmental
of protecting the environment.
Jember and Madura
initiatives, Telkom received the
One of these programs is tree

planting for reforestation with
- creating biopore holes in Bogor

and Bandung.
Asian Townscape Sector Award

2013 for its work at Taman Bungkul
in Surabaya.
various communities, considering

in absorbing and balancing
ENVIRONMENTAL ACTIVITY
COSTS AND AWARD
Telkom has also never received
excess CO2 emissions in the
Telkom has budgeted and
a financial fine related to
atmosphere through the process of
disbursed funding for
environmental violations.
photosynthesis.
environmental conservation
trees play a very important role
purposes as part of its commitment

A variety of participative activities
to environmental rehabilitation in
have been implemented through
the following forms:
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Telkoms
People
Developing Employee Competencies and

Careers
70
Benefits
74
Occupational Health, Safety and

Environment (HSE)
76
Industrial Relations
78
IT-based HR Service System
80
Culture Transformation
81
Employee Profile
82
Awards
83
Telkom Preserves
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69
Telkom consistently strives to improve the

competency of its Human Resources through the
implementation of the integrated Human Capital
Master Plan (HCMP), accompanied by efforts to
meet the expectations of Human Resources in
line with performance assessments conducted
fairly, reasonably and transparently to support the
achievement of Telkoms business targets in the
fields of world-class Telecommunication, Information,
Multimedia, Edutainment and Services (TIMES)
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Telkom considers human resources
The HCMP provides Telkom with
work location;
to be human capital, as well as the
the three following variables to
formation total;
spearhead for the achievement of
effectively fulfill HR requirements:
monthly planned employee
three sustainability goals, namely
accurate human capital
profit, people and planet. Telkoms

employees have a strategic role
in generating profit, conducting
social welfare for people and
conserving the environment of the
planet. For Telkom, its employees
requirement projections, both

for totals and competencies;
employee allocation plans and
setting, including promotion,

transfer, work status (contract/
permanent); and
recruitment / termination.
career development plants; and

human capital productivity
measurements.
Telkom prepares its employment

plan by identifying employee
needs, with reference to the Human
are stakeholders with a central role

in achieving the vision and mission
The realization of HR requirements
Capital Master Plan (HCMP) or
of the company in the context of
following the related infrastructure
Telkom Group Rolling Human
sustainability.
is based on the principles of
Capital Plan. The focus of the
synergy and optimization of
plan is to increase productivity
Therefore, Telkom implements
internal human resources from the
and efficiency, with reference to
human resource management
ranks of Telkom Group. Efforts
competitive benchmarks, reducing
strategies with a focus on
to synergize and optimize are
the total number of employees,
improving competencies in line
undertaken by preparing a five-year
in addition to continuing to
with Telkom Groups TIMES
plan for employee allocation and
recruit approximately 20% of
business portfolio. At the same
an annual employment plan. This
the total number of employees
time, Telkom works to improve the
planning is necessary to achieve
that have left. The employment
harmonious industrial relations with
and control human resource
plan includes a description of the
all employees, realized through
development targets.
human resource profile calculated

based on the business activities of
the implementation of various

policies, including: enhancing the
HR management strategies are
each company in Telkom Group,
conducive working environment,
focused on harmonizing the
as well as explaining based on
providing attractive incentives and
number and competencies of
job description, position, age and
reward systems, appreciating those
human resources in line with
educational background.
who excel through promotions
the business portfolio, which is
or improvements to their career
increasingly focused on TIMES.
path, and management policies
Telkom is also working on
that are responsive to employee
improving synergy and efficiency
expectations.
among Telkom Group companies
DEVELOPING
COMPETENCIES AND
EMPLOYEE CAREERS
and continuing to emphasize the

Telkom has compiled an integrated
application of corporate values.
Human Capital Master Plan (HCMP)
Recruitment
Telkom recruits human resources
referring to long-term corporate
Employee allocation plans are
by optimizing internal resources
planning and taking into account
prepared no later than the fourth
through synergy within Telkom
the business strategy of each
quarter of each year, are valid for
Group. The goal is to promote
subsidiary in Telkom Group. To
the coming year and pay attention
efficiency in employee turnover
improve competitiveness, Telkom
to information such as:
costs in each company and to get
also uses the productivity ratio for
the name of the positions
the best candidates according to
several similar companies as a basis
previously, currently or to be
for supply and demand analysis
held by an employee;
measurement in preparing HCMP.
required qualifications.
position layer;
The synergy itself also facilitates
job stream;
the development of each
Telkom Preserves
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employees career within the ranks
In 2013, Telkom conducted three recruitment job fairs to ensure the
of Telkom Group and enables
selection process was transparent and non-discriminative. A total of 838
employee requirements to be
new employees were recruited.
fulfilled internally. Where possible,

the need for employees is met
through recruitment within Telkom
Employee composition as a result of recruitment is as follows:

Classification
Group.
New Employees
As such, we attempt to synergize
2013
Female
Total
Male
Female
Total
11
15
26
13
12
25
12
11
12
23
26
13
12
25
New Employees based on age
recruitment through the following
18-25
efforts:
26-35
Total
11
holding career days;
2012
Male
15
joint utilization of infrastructure

and facilities, such as locations
Competency-based HR Development
for training or assessment of
Telkom implements a human capital competency development strategy
employees during the selection
contained in its HCMP, which is renewed every year to ensure it remains
process;
in line with business dynamics. The HCMP is implemented in line with
joint utilization of candidate
business strategy, based on the Corporate Strategic Scenario (CSS), Human
database and modules or
Capital Master Plan (HCMP), Human Capital Development Plan (HCD Plan),
materials related to knowledge
organization transformation and the companys financial condition.
of Telkom Group products; and
Telkom applies the CBHRM approach to assess the competencies of its
synergy initiatives for other
human capital. The CBHRM model consists of Core Competency (values),
recruitment fields.
Generic Competency (personal qualities), and Specific Competency (skills

& knowledge). These three models are developed and refined to support
External recruitment is aimed at
fair and transparent assessment of employee capabilities.
improving employee composition

from the aspects of age and
Telkom has a competency directory, which contains a list of competencies
education. Therefore, this
required by the company, which are regularly renewed and adjusted
recruitment is focused on fresh
according to the companys business dynamics, including the types of skills
graduates with a bachelor or
and knowledge competencies required for the change in the company
master degree in a field compatible
business portfolio to TIMES.
with the business portfolio. Telkom

looks for talent with excellent soft
Competency development for Telkom employees prioritizes the following:
and hard skills to become the
character development based on corporate culture, The Telkom Way,

which has its foundation on the philosophy To be the Best, Principle
companys future leaders.
to be the Star (solid, speedy, smart) and Practice to be the Winner

(imagine, focus, action);
global-standard competency development; and
leadership development based on Telkom Leadership Architecture,

which has its foundation in the principles lead by heart and manage by
head.

Telkom strengthens the competencies of its human capital through
education and training to change and develop competencies that are both
directly and indirectly related to business and operational strategy, in follow
up to the companys business portfolio transformation now focused on
TIMES. Training to change competencies is aimed at preparing employees
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to be able to face the change
well as various renowned external
Directorship Executive
from Time Division Multiplexing
education/training institutes.
Program).
(TDM)-based telecommunications
During 2013, the employees took
to Internet Protocol (IP)-based
part in competency development
Determination of employee
telecommunications and IMES
training. The average number of
participation in these overall
competencies. Competency
training hours per employee during
competency development
development training is aimed at
2013 amounted to 27.5 hours/
programs is based on the needs
preparing employees with certain
employee.
of the company and employees,

with attention to gender equality
skills to support the companys

business portfolio.
To create leaders for the companys
and equal opportunity for all
future, Telkom also provides
employees.
To improve cooperation with
leadership development training,
business units in the Telkom
in which 897 employees took part
To run its education and training
Group and in the interest of
through the following programs:
programs during 2013, Telkom
cost efficiency, synergy with
First Level Leadership
disbursed funding of Rp265.3
Telkom Group is implemented
(Emerging Leaders
billion (2012: Rp158.4 billion), or an
covering joint work on programs,
Development Program, First
average of Rp10.6 million (2012:
cooperation with participants and
Line Development Program,
Rp8 million) per employee taking
facilities.
Coaching for Supervisor)
part in the programs.
Middle Level Leadership
In 2013, the employee education
(Managerial Development
Other efforts to develop employee
and training program held by
Program, Coaching for
competencies include the
Telkom focused on technology,
Manager, 4DX Certification);
Knowledge Management program.
marketing and telecommunication
and
In this program, every employee
Senior Level Leadership
has the opportunity to exchange
and new wave business
(Executive Development
ideas, exchange concepts and
development to support Telkoms
Program, Commissionership
share information through articles
vision to become a TIMES market
Executive Program,
accessible by all employees.
management, business information
leader. This training was held at

Telkom Corporate University, as
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Telkom Corpu
The Global Talent Program (GTP) is a key program run by Telkom CorpU
As part of the companys value
aimed at providing all Telkoms human resources with global exposure and
application, i.e. its commitment
an understanding of international standard business development. GTP
to the long term and caring
is especially for talented employees to shape them into great people with
meritocracy, Telkom invests
the aim of winning competitions and achieving the companys business
in people. To realize this, the
goals through the companys international assignment experience and
guidance of leaders and employees
certification. This program was initiated in 2012 and is expected to produce
(people) is the first and primary
credible talent able to compete with international companies.
strategic initiative formulated

as a Center of Excellence. As
The program begins with the recruitment process, which is based on pre-
manifestation of the Center of
determined criteria, matching talent profile with work assignment, briefing
Excellence concept, on
prior to assignment (pre-departure), assignment within Indonesia and
28 September 2012, we established
overseas, a final exam and final placement.
Telkom Corporate University

(Telkom CorpU) in the expectation
Telkom has been sending its talent on GTP in stages to provide them with
that it would create a system to
global exposure and global experience, thus enabling them to compete
give birth to excellent leaders
with international-scale companies. In 2013, Telkom sent 1,010 people to 25
and people through three main
countries.
functions:
Center of chiefship (creating
great leaders)
Another Telkom CorpU program in 2013 was international certification in a

variety of fields, which involved 1,471 employees.
Telkom CorpU is expected to

create the leaders of the future,
Career Development
who are of higher quality and
Telkom applies an objective employee performance assessment system.
of international standard, and
Assessment of each employees performance is based on two aspects,
are continuously able to display
namely results, which are based on individual work targets, and processes,
the appropriate leadership
which are based on required competencies. Assessment is done online for
skills for the period in which
a number of relevant behavior indicators demonstrated by the employee
they operate and to initiate a
while working (demonstrated behavior). The procedure is adopted to
successful regeneration process,
enable employees to move along the companys competency development
being leaders able to develop
path.
future leaders who are even

more successful.
Center of competence (creating
great people)

Telkom CorpU is expected

to create strong, high quality
people, because it is such
people that play a significant
role in a companys success.
Center of certification (creating

global standards)

Telkom CorpU is expected

to produce global standard
human capital. Each
leadership and competency
development program must
be of international standard
and every graduate must
have international standard
certification.
We strengthen the management

of employee careers with the
implementation of special
development patterns for
highly talented and competent
employees.

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The competency assessment
is related to HR processes, in
Employee Work Performance Assessment (Key Performance Indicators)

Level Job Target
the interest of competency
Internal Telkom 2012

(Hcc & Hr Partner)
Internal Telkom 2013

(Hcc & Hr Partner)
development, career development,
Directors
118
31
remuneration, performance, and
Top Level
638
537
even early retirement.
Middle Level
817
1,404
Telkom has a special competency
Total Internal Client

Assessments
First Level
development path for employees
207
219
1,780
2,191
considered talented, consisting of

standard and special competency
development contained within an
Individual Development Program
(IDP) to prepare such employees as
future leaders for key positions in
the company. Telkom has prepared
the Telkom Group TopTalent forum,
which is a group of employees with
the highest competencies and/
or work performance, as well as
strong potential shown through
the Assessment Center from layer
1 and 2 positions (under the Board
of Directors) from all the Group
companies. Telkom uses its Top
Talent data to fill layer 1 and 2
positions across Telkom Group.
Telkom refers to its Staffing Plan
to determine employee career
movements, namely the demand
to fill positions at Unit Leader /
Director level, to the Telkom HR
Director.
In follow up to competency
development, in 2013, 2,191
employees (2012: 1,780 employees)
had their performance assessed, as
below:
BENEFITS PACKAGES
Competitive Remuneration
Telkom offers attractive and competitive remuneration packages that
are based on reference to applicable regulations and adjusted to be
competitive in market conditions. The remuneration package consists of
a basic salary and allowance-related salary, bonuses and various benefits,
including pension plans and post-retirement health care programs, health
benefits for employees and immediate family members, housing assistance
and other specific benefits associated with unit performance.
As an incentive for every employee to perform optimally in accordance with
their capabilities, Telkom pays performance bonuses. The performance
bonus is calculated and determined based on assessment of individual and
group performance, as agreed in the key performance indicators (KPIs) set
in advance and in accordance with Telkoms overall performance.
Bonuses are accrued during the ongoing year and distributed in the
following year. In the last five years, Telkom has paid annual bonuses
ranging from Rp326.9 billion to Rp513.9 billion. The 2013 performance
bonuses will be determined in accordance with completion of the 2013
Financial Report audit, as well as the approval of the AGM. This also applies
to the determination of performance bonuses for the previous year and in
subsidiary companies.
Gender Equality and Remuneration Determination
Telkom remains consistent to policies on equality and equal rights and
does not discriminate in remuneration packages between male and female
employees. The average remuneration ratio, i.e. the basic salary for men
and women at the same level is 1.00, or the same. Any difference in
remuneration paid is purely based on performance assessment and length
of service.
Telkom always fulfills applicable criteria in the provision of remuneration,
namely setting basic salaries for new employees at the lowest level at a
higher rate than the regional minimum salary (UMR) set by the government.
The following table demonstrates the basic salary for Telkom employees
at the lowest level who are new recruits and assigned in Indonesias five
largest cities.
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People
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Table illustrating Lowest Salaries for New Recruits at the Lowest Level
In addition to the above programs,
Compared to Regional Minimum Wage in Indonesias Five Main Cities, 2013
Telkom also holds various kinds

of training designed to support
Area Operations
Operational Area UMR set

by Province/Regency (Rp)
Bandung
Basic Salary for New

Employees at the Lowest
Level (Rp)
employees approaching retirement

age. The entrepreneurial skills
training program is run for
1,538,703
1,883,000
Jakarta
2,200,000
2,228,100
Medan
1,650,000
2,085,300
Surabaya
1,740,000
1,954,400
Telkom retirees who have become
Makasar
1,500,000
2,013,900
successful entrepreneurs invited to
employees as they reach 50

years of age. Training takes the
form of active discussions, with
speak and involved in the program.

Telkom pays similar basic remuneration to all its employees. However,
Employee Awards
we provide special incentives for permanent employees, such a pension,
Telkom annually and simultaneously
housing allowance and several long-term benefits that are not made to
makes special awards to high
contracted employees.
achieving employees who have

made significant contributions to
Pensions and Pension Benefits
the achievement of the Companys
The retirement age for all Telkom employees is 56. In the interest of
business targets and to non-
supporting guaranteed welfare after retirement, in line with employee
employees who have contributed
expectations, we implement a pension program for employees. We
to enhancing the Companys
sponsor two pension programs, these being a (i) defined benefit
reputation. The provision of
pension plan (DBPP) for employees recruited prior to 1 July 2002; and
rewards is a means for the Company
a (ii) defined contribution pension plan (DCPP) for other permanent
to express its gratitude to these
employees.
individuals.
Telkom has also designed an early retirement program to create a more
The provision of these awards is
effective and competitive business environment.
regulated in the Telkom Employee

Reward policy and they are made to
Explanations of the pension programs can be seen in Telkom Supports
individuals and groups in a variety
Economic Growth.
of types and forms in accordance

with the level of significance to
Telkom sponsors training activities

in entrepreneurship skills for
permanent employees to ensure
their welfare after ending their
employment.
the company and can include

the choice of making a religious
pilgrimage, benchmarking to
the telecommunication industry
and global-scale companies,
the opportunity to take part in
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international seminars, as well as special incentives. The reward program
Yakes Telkom. Our contribution
is also run by other companies within Telkom Group to motivate their
to this program amounted to
employees.
Rp301 billion for the year ending
31 December 2013.
2. All other permanent employees
2013 Reward Categories for Individuals and Units

No. Award Type
INDIVIDUAL AWARDS
Internal Awards
Prime Rewards
Best Innovator
Special Innovation
Kampiun (Knowledge Management)
Award
The Healthiest Family
Religious Rewards (pilgrimages)
External Awards
1.
Satyalancana for Development
2.
Satyalancana Wira Karya
TOTAL
WORK UNIT AWARDS

Internal Awards
1.
National Level Telekomunikasi Area
2.
(Witel)
Chief Regional Officer
TOTAL
Reward Recipients
are entitled to health services
Total
in the form of insurance
Unit
benefits. Our contribution to

this program amounted to Rp17
444
29
5
6
1
62
4
4
555
Individual
Individual
Individual
Individual
Individual
Individual
Individual
Individual
Individual
billion for the year ending 31

December 2013.
Extracurricular Activities
Telkom provides the opportunity
for all employees to participate in
various extracurricular activities,
especially those that support
employee productivity. Our
employee extracurricular activities
cover religious, cultural and
sporting activities. These activities
are also open to employees
Unit
families, such as Al-Quran reciting
Unit
Hindu chanting (Utsawa Dharma
Unit
competitions, church choirs, and

Gita).
Telkom believes that there is a strong correlation between improved
OCCUPATIONAL HEALTH,
SAFETY AND ENVIRONMENT
(HSE)
welfare, employee health and improved company productivity. For this
Telkom is committed to complying
reason, Telkom provides health services for our employees and retirees
with occupational health, safety
and their direct family members, which is managed by the Telkom Health
and operational environment,
Foundation (Yakes). There are 101 employee representatives (2012: 111) or
as well as securing production
0.58% of Telkom employees actively involved in the management of Yakes
sources, the production process,
to ensure that the programs are in line with employee expectations.
production equipment and
Employee Health Management
the work environment. This

As of December 31, 2013, a total of 113,629 (2012: 124.543 people)
commitment is manifested through
employees, retirees and their families were registered for health services
the application of the HSE program
through Yakes. This reduction in numbers is due to membership ending as
through company policy regulated
the age limit has been passed or due to death.
by Directors Decree No.KD.37/

UM400/COO-D0030000/2010
Post-Employment Health Services
concerning Determining Safety
Telkoms attention to welfare continues when employees retire. One
Governance and Enterprise
demonstration of this is the provision of post-employment health services
Security Policy.
for all employees, their spouse and children. Telkom provides two kinds of
program for post-employment health services:
1. Employees who were hired before 1 November 1995 and have more than
20 years of services are entitled to health care benefits managed by
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Since 2009, we have focused
Telkom fully respects the rights of employees to absent themselves from
HSE management on achieving
their duties for a defined time period for reasons related to health without
zero accidents. This program
loss of rights. In particular, employees have the right to take maternity
is implemented based on
and pregnancy leave with the full support of the Company. In addition to
manpower regulations and the
maternity leave, employees recovering from serious illness and holding a
HSE regulations of local Manpower
doctors certificate are entitled to leave with full benefits. During the 2013
Agencies through Supervision by
reporting period, 106 employees (2012: 120 employees) took maternity
the Manpower Ministry, which we
leave.
implement through the Security

and Safety unit.
HSE Training and Accident Levels

During the reporting period, Telkom ran a variety of HSE training activities,
We also include a commitment
including:
to compliance with the points in
1. General Expert HSE Training and Internal Auditor HSE management
Article 35 of CLA V, which states:
system training;
Telkom is obliged to implement
2. Fire Emergency Response Training at Bogor Witel;
occupational safety and health
3. Training and earthquake emergency response training in East Jakarta;
systems in compliance with all
4. Training in emergency response to flooding of vital installations with the
prevailing laws and regulations.
Indonesian Navy at Bekasi Witel.
Thus, in addition to providing

training related to HSE, we also
In addition to training in disaster response and workplace accidents,
provide employees and their
Telkom also held training seminars related to occupational health run in
immediate families with health
cooperation with the Jaring K3 every two months, as illustrated in the table
benefits through Yakes Telkom.
below.
Comprehensive information
related to the dissemination,
Occupational Safety Training:
education, training, counseling, and
- General Expert HSE Training and Internal Auditor HSE management
preventative and risk mitigation
system training;
measures against serious illness for
- Fire Emergency Response Training at Bogor Witel;
employees and their families can be
- Training and earthquake emergency response training in East Jakarta;
found on the website
- Training in emergency response to flooding of vital installations with the
In addition, as implementation
- HSE training held with Jaring K3 once every two months.
Indonesian Navy at Bekasi Witel;

of our HSE policies, we have also
established regulations governing
In addition to the points explained above, Telkom supplies applications with
overtime work by employees.
features to support the achievement of zero accidents, namely online HSE
In accordance with Section 14,
management system and online safety care.
CLA V, the maximum number of
1. The online HSE management system application that can be accessed
permissible overtime hours for each
by all organic employees contains the HSE management system
employee is 60 hours per month.
measurement criteria and can be used for online monitoring, evaluation
Telkom has not yet conducted an
and analysis, thus facilitating and accelerating the implementation
assessment of its work units and
process and updating of information nationally.
vendors related to the risks related

to forced labor.
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2. The safety care online application is a tool to instill employee awareness
Internal HSE Management System
in relation to HSE aspects in their respective workplaces, for example to
Audit
provide information on high risk conditions in specific work locations so
To ensure the company has
solutions can be quickly identified.
determined its goals, targets

and HSE program to fulfill the
A number of measures to increase the level of HSE awareness and to
determined HSE policies, an annual
provide training have been implemented down to the work unit level
Internal HSE Management System
throughout Telkoms area of operations. These have resulted in the
Audit is conducted (for all Areas,
granting of zero accident awards for work units that have successfully
namely West, South, Central, East
maximized working hours by eliminating working hours lost due to
and North Jakarta, Bekasi, Bogor,
workplace accidents.
Tangerang) and a sampling of

regions (West Java/Lembong,
During 2013, several Telkom business units received zero accident awards
East Java/Malang, Central Java/
at the Occupational Health and Safety award event held by the Central
Semarang, Sumatra/Medan, KTI/
Government (through the Health Ministry), as well as from regional
Bali).
governments, as follows:
zero accident HSE awards from the Manpower and Transmigration
INDUSTRIAL RELATIONS
Ministry between 1 January 2009 and 31 December 2012 for 13 Telkom
In accordance with Presidential
office locations;
Decree No. 83/1998 concerning
zero accident HSE awards from the Banten Governor between 1 January
the Ratification of ILO Convention
2009 and 31 December 2012 for Telkom in Tangerang area; and
No. 87/1948 concerning Freedom
awards from the Directorate General for Manpower Supervision in
of Association and Protection of
the Manpower and Transmigration Ministry for HSE management
the Right to Organize, Telkom
system audit results at Satisfactory Level for Telkom in West Jakarta,
supports the operations of the
Balikpapan in East Kalimantan, South Jakarta, Telkom Head Office, and
Telkom Employees Union (Serikat
the Telkom Building in Solo.
Karyawan Telkom, SEKAR). As

of 31 December 2013, SEKAR
These achievements follow the zero accident awards received by various
consisted of 16,283 employees,
other business units in 2012. A list of business units receiving zero accident
representing 91.1% of the total
awards in 2013 and the number of safe hours they have successfully
number of Telkoms and its joint
achieved is as follows:
venture companys employees.

Safe Working Hours
1,638,569
In accordance with the principles
Telkom Bogor area
2,143,736
concerning Labor and Collective
Telkom West Jakarta area
2,503,164
Labor Agreements (CLA) and
Telkom South Jakarta area
1,592,892
in Regulation of the Manpower
Telkom East Jakarta area
4,077,024
and Transmigration Minister No.
Telkom North Jakarta area
2,269,530
Telkom Tangerang area
3,834,832
Telkom Sumatera region
2,012,569
Telkom West Java region
2,094,151
Location
Telkom Bekasi area
Telkom Central Java region

Telkom East Java region
Telkom Kalimantan region
Telkom KTI region
2,044,573
2,041,061
5,092,684
8,671,826
Telkom GMP Bandung
2,025,063
Telkom GMP Jakarta
3,404,798
Telkom Central Jakarta
4,086,952
enshrined in Law No. 13/2003
16/2011 concerning Procedures for

the Formulation and Ratification
of Company Regulations and the
Formulation and Registration of
Collective Labor Agreements,
Telkom worked with union
representatives to renew CLA IV,
which expired at the end of 2012.
At this time, CLA V is in effect and
has been so since 23 August 2013.
It will expire on 23 August 2015.
Section 61 of CLA V establishes
a minimum period of prior notice
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or security guards took part in
training of this sort.
Telkom has not yet implemented
measures to screen contractors
on their compliance with the
principles of human rights.
However, contracts entered into
with contractors and involving
substantial sums of money (above
Rp100 billion) contain clauses
mandating compliance with all
prevailing laws and regulations in
Indonesia, including the Human
Rights Protection Law. Compliance
and respect for human rights is
in cases where Telkom plans to
Through a Circular of the Human
implement substantial revisions
Capital and General Affairs
to its operations, such as changes
Director No. ER02/PS000/COP
to the nature of the business it
B0011000/2008, dated
conducts.
15 August 2008, concerning Telkom

Employees who serve as Members/
Human Rights
Organizers/Functionaries of
Telkom is strongly committed to
Political Parties and/or Legislative
the achievement of full compliance
Candidates, Telkom has forbidden
with all measures to protect
employees from participating in
human rights within its operations.
general election campaigns or
Among other means, this
serving as organizers for such
commitment is manifested through
campaigns. This regulation also
the promulgation of policies
forbids the Company from making
guaranteeing the right to collective
financial contributions or providing
action, the right to engage in
other assistance, including the use
political activity, to freely express
of its facilities and infrastructure,
political aspirations, and to provide
for activities related to elections.
constructive input to the Company

(either through the employee union
Human Rights Training and
or through other means established
Awards
for this purpose).
Telkom requires human rights

training be conducted periodically
Telkoms strong commitment
for employees whose particular
to upholding human rights is
duties mandate a high level
manifested through a number of
of respect for human rights.
company policies, including Board
Included in this group are security
of Directors Decree No. KR.08/
guards employed throughout
PS560/COP-B0011000/2009. As
Telkom Group, who receive
of the publication of this report,
training to ensure that they are
Telkom had never been associated
able to implement their duties
with acts that could be considered
appropriately without engaging
to represent an infringement of
in infringements of human rights.
human rights or with any other
Throughout 2013, no employees
discriminatory practices.
demonstrated by the fact that

there were no reports of Human
Rights infringements at any
locations in which the Company
operated throughout 2013.
Our commitment to human
rights is also manifested during
the recruitment process for
new employees. Telkom strictly
implements a policy of requiring all
Telkom employees to be at least 18
years of age and applies a 3:1 ratio
of standard wages compared to
minimum regional wages. As yet,
no assessment has been conducted
over Telkoms work units and its
vendors regarding the use of child
labor.
These policies are regulated by
Board of Directors Decree No. 46/
PS200/COP-B0011000/2009,
dated 23 December 2009,
concerning recruitment systems.
The implementation of this
regulation is a manifestation of our
commitment to prevent the use of
child labor at any work unit within
Telkom Group.
Freedom of Association
The right to engage in collective
action is an important component
of universal human rights. Telkom
respects the right of freedom of
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association by respecting the right of employees to engage in collective
In accordance with the regulations
action through participation in the employee union, which is known as
contained in the Company Code
SEKAR. This right is explicitly stated in the preamble and 5K of CLA V,
of Ethics and the CLA, Telkom
which has been affirmed by both SEKAR and Telkoms management and
imposes stringent sanctions,
came into effect on 23 August 2013.
including legal action, against

any individual involved in corrupt
To support SEKARs activities and to demonstrate its consistent
practices, fraud or similar violations.
commitment to human rights, in accordance with Article 6 and Article 7
CLA V defines the status of SEKAR as a representative body empowered
INFORMATION
TECHNOLOGY-BASED
HUMAN RESOURCE SERVICE
SYSTEM
to propose and discuss solutions related to problems between labor and
To support the productivity of its
management.
employees, Telkom has developed
of CLA V, Telkom provides facilities, funding and permission for SEKAR

and its members to conduct activities during office hours, provided this
does not result in any infringements of prevailing regulations. Article 4 of
an integrated communications
Telkoms commitment to and support for operational practices that
infrastructure. The goal of this
demonstrate respect for human rights has enabled the Company to
infrastructure is to facilitate policy
prevent conflicts between employees and management, including conflicts
coordination and the dissemination
resulting in strike action that may result in losses to both parties.
of corporate business strategies

through communication between
Preventing Corruption
those formulating policies,
Telkom is strongly committed to playing a role in the elimination of
human resources managers
corrupt practices. This commitment is manifested through a number of
and employees. Telkom strives
work procedures to ensure the transparency and accountability of our
to ensure that communication
operations in accordance with corporate governance best practices.
channels function optimally and
In addition, Telkom conducts measures to ensure the integrity of all
facilitate the Companys ability to
employees. These measures involve dissemination campaigns and
communicate policy and to guide
the application of a Code of Conduct, cultural transformation, and the
business practices amongst all
implementation of a consequence-bearing whistleblowing system.
levels of staff.
In harmony with efforts to prevent corruption, Telkom also strives to increase
A website has been made
the level of knowledge and awareness of employees, particularly those
available to the Human Capital
involved in monitoring and control functions, by holding seminars and
and General Affairs division to
training within Indonesia and abroad concerning anticorruption measures
facilitate communications between
and their implementation. Additional training is also provided to employees
policymakers, human resource
involved in activities where the danger of corrupt practices is considered to
managers and staff. Through this
be high. In 2013, no employees took part in anticorruption training.
website, employees can access

information related to company
In addition, Telkom strives to eliminate corrupt practices through
policies and may present questions
monitoring and control functions implemented by the Internal Audit and
on issues related to human
Audit Committee. Through more intensive monitoring, during 2013, the
resources.
Audit Committee took further action in two cases of reports falling into the
category of complaints related to accountancy, internal controls, violation
We have also developed HR
of regulations, suspected corruption and violations of the code of ethics.
applications designed to meet the

needs of Telkom Group, i.e. Telkom
Description
Total
Explanation
Group IHCMS (Integrated Human
Number of complaints
Complaints received
Capital Management System).
Fulfilling requirements
Complaints meeting requirements to
These IT-based HR services consist
Complaint category
be followed up
Suspected corruption
online registration, online Business
Complaint progress
Complaints in the process of being

followed up
of online Individual Work Targets,

Travel Instruction, online leave,
online careers and online Annual
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Tax Returns. Other IT-based applications have also been developed, such as the automation of a number of
corporate business procedures, including the publication of electronic memos, virtual meetings, shared files, online
surveys, and intranet facilities. In the application of the Go Green program, Telkom has replaced HR administration
with Employee Self Service (ESS) applications.
All the above facilities and services are manifestation of Telkoms realization of environmentally friendly
management, bearing in mind HR administration has been replaced with the ESS application, and can be
categorized as a Paperless Office.
CULTURE TRANSFORMATION
Since 2009, Telkom has been transforming its company culture and traditions under the slogan The Telkom Way,
which is explained in Directors Decree No. 22/PS150/COP-B0030000/2010 dated 10 June 2010 regarding The
Telkom Way Corporate Culture. These steps have been taken to ensure the Corporate Culture is developed in
accordance with the demands and changes taking place in the business environment, as well as the ability to
support precautions faced at all levels in future industry developments.
The Telkom Way Corporate Culture has five corporate values, namely Commitment to the long term, Customer first,
Caring-meritocracy, Co-creation of win-win partnership and Collaborative innovation, which we refer to as 5C.
something not only for

current benefit, but also
for the future
Commitment to
Long Term
customers ahead of internal

customers
5 Corporate
Values
Customer
First
Caring
Meritocracy
through rewards and

consequences congruent
with performance and
behavior
Co-creation
of win-win
partnership
Treating business
partners as partners of
equal level
Commitment to Long Term
Co-creation of Win-win
Collaborative
Innovation
Elimination the internal focus
within Telkom and Telkom Group
and opening to ideas regardless
of source
Telkom has disseminated its
Doing something not only for
Partnerships Treating business
culture with an incremental top-
current benefit, but also for the
partners as partners of equal
down approach, starting with the
level; and
Companys top leaders and senior
future;
Customer First Always
Collaborative Innovation
prioritizing customers ahead of
Elimination the internal focus
internal customers;
within Telkom and Telkom Group
Caring Meritocracy Providing

guidance through rewards and
leaders, who ultimately propagate it

in its entirety to all employees.
and opening to ideas regardless
Commencing in 2011 and continuing
of source.
in the 2013 reporting year, Telkom
consequences congruent with
has been disseminating The
performance and behavior;
Telkom Way program to external
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G4-10 | G4-LA1
parties. This cultural transformation is being achieved
1.8
through a number of activities using a four quadrant
34.2
approach, namely: understanding and conviction,
15.9
Senior Management
formal processes and system. We believe that the
Middle Mangagement
new corporate culture that has been formulated and is
Supervisors
being disseminated among all Company stakeholders
Others
will ensure Telkoms success into the future.
48.1
EMPLOYEE PROFILE
The total number of employees in Telkom Group per
Employee Profile Based on Education
31 December 2013 was 25,011, of which 17,881 were
The Telkom employee composition per 31 December
employed by Telkom and 7,130 by subsidiaries. This
2013 demonstrated that there was a relatively small
is a 2.6% reduction from the 25,683 employees per
percentage of non-university graduates, at 25.2%,
31 December 2012, which comprised 19,185 Telkom
compared to university graduates (holding diplomas
employees and 6,498 employees in subsidiaries.
and bachelor degrees) at 65.9%. The number of
This reduction is due to the success of the multi
employees without a diploma or degree has been
exit program implemented to revitalize and improve
tending to fall as Telkom has been focusing on the
efficiencies in Telkom employees and which has
recruitment of highly educated employees to fulfill job
been ongoing since 2002. Of the total 17,881 Telkom
requirements to support business progress.
employees in 2013, all were permanent employee

status.
Education Level
Employee Profile Based on Position

Following are details of Telkom Group employees
based on position in respective companies for 2013.
Telkom
Subsidiaries
Telkom
Group
2013
Total
Employees
%
Composition
Senior
Management
135
255
387
1.8
Middle
Management
2,711
1,048
3,619
15.9
Supervisors
9,936
1,774
11,765
48.1
Other
5,099
3,421
9,912
34.2
Total
17,881
7,130
25,011
100.0
Telkom strongly adheres to the principle of gender
Tertiary
Education
6,297
2012
%
Total
Employees
25.2
6,864
%
26.7
Diploma
5,234
20.9
5,545
21.6
University
Graduate
11,264
45.0
11,140
43.4
Post Graduate
Total
2,216
8.9
2,134
8.3
25,011
100.0
25,683
100.0
Graph demonstrating Telkom Employee Composition

based on Education Level in 2013
(in %)
equality and stipulates that competency levels are the

basis for recruitment and promotion. The relatively
8.9
high number of male employees compared to female
25.2
Tertiary Education
employees is the result of operational needs in the field,
Diploma
with a strong need for physical labor.
University Graduate
45.0
20.9
Post Graduate
Telkoms current employee composition is dominated

by those holding three-year diplomas and higher, with
increasingly high levels of competency, as demanded
by business developments and as a result of the multi
exit program and high quality recruitment.
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G4-LA1
Employee Profile Based on Age
Traditionally, most employees have left the Company
Based on age, there is a 65.7% domination of those
due to voluntary resignation, promotion to senior
over 45 per 31 December 2013, followed by those aged
positions within the Telkom Group, within its
between 31 and 45 at 24.7%, while employees aged
subsidiaries, or in government entities. In addition, a
under 30 account for 9.6%.
proportion of employees have left the Company due to

reaching retirement age or as a result of death.
Considering the above age composition, Telkom

has designed a recruitment program to ensure the
In 2013, the number of Telkom employees, excluding
continuity of business activities and operations.
those in subsidiaries, who left the company totaled

1,327 people, an increase of 537 on the number that left
Age
2013
in 2012. Approximately 781 of these took advantage of
2012
the 2013 early retirement program.
Total
Employees
Total
Employees
2,400
9.6
2,358
9.2
6,171
24.7
9,083
35.4
Telkom employee turnover rates, excluding subsidiaries,
>45
16,440
65.7
14,242
55.4
over the last two years.
Total
25,011
100.0
25,683
100
<30
31 45
Following is a table demonstrating the comparison in
Classification
Graph demonstrating Telkom Employee Composition

based on Age in 2013
(in %)
9.6
24.7
<30
31 - 45
>45
65.7
Employee Turn Over
2013
Male
2012
Female
Total
Male
Female
Total
New recruits
11
15
26
13
12
25
New recruits
by age group
12
11
12
23
18-25
26-35
Total
11
15
26
35
12
25
Employees
leaving:
Own request
10
Disciplinary
action
Death
62
11
73
Retirement
35
456
65
521
Early
retirement
Other
12
12
Total
41
537
80
617
Telkom strives to maintain and to create a comfortable
AWARDS
work environment, with sound employee management
The implementation of several of our planned, directed
policies and a reputation as a company with attractive
and consistent HR programs has seen Telkom win four
remuneration packages, which has ensured a relatively
key awards in the Indonesian Human Capital Studies
low employee turnover rate. The increased percentage
2012 event that was supported by Dunamis Human
turnover in certain years is more as a result of the
Capital and Business Review Magazine in October 2012.
implementation of the early pension program, which

was conducted transparently and participation in
which was voluntary for employees who fulfilled certain
specified criteria.
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2013 Sustainability
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Growth
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Telkom
Governance
GCG Framework and Performance
86
Company Governance Structure
88
Governance Strengthening Roadmap

and Initiatives
86
Code of Ethics and Corporate Culture
91
Whistleblowing System
94
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To achieve effective and efficient sustainable

corporate growth and performance, we
declared 2013 as the year to strengthen good
corporate governance (GCG) in all business
groups
85
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The goal is that GCG implementation is always binding
GCG FRAMEWORK AND PERFORMANCE
and aligned with the demands of the business and
Our commitment to implement GCG is embodied in a
ongoing changes in the industry today. We are
policy framework for GCG implementation regulated by
responding to these changes with transformation of
Directors Decree No. 29/2007 and reinforced by Group
the business portfolio and the organization.
GCG Guidelines No. 602/2011. This framework contains

several integrated systems as a prerequisite or an
By applying GCG in accordance with the provisions of
inseparable part of GCG implementation. The aim is to
the Company Law and General Guidelines for GCG in
guarantee and ensure the effective implementation of
Indonesia issued by the National Governance Policy
good corporate governance down to operational level,
Committee (KNKG), Telkom is also fundamentally
which ensures that every transaction, both internal and
required to practice effective GCG to comply with
external, is executed ethically and in accordance with
provisions in the SarbanesOxley Act (SOA) of 2002,
good and true corporate governance practices.
as well as the requirements of the United States

Securities and Exchange Commission (US SEC).
Several of these systems are business ethics, policies

and procedures, risk management, internal control
In implementing GCG, we strive to ensure the creation
and monitoring, leadership, duty and responsibility
of a phase whereby the company is well governed. At
management, management empowerment and
this stage, we are not only able to manage risk well,
employee competence, performance assessment and
but also have the ability to respond to a variety of
rewards and recognition.
changes and to take advantage of change to improve

support the achievement of goals and the long term
ROAD MAP AND INITIATIVE TO STRENGTHEN

GOVERNANCE
sustainability of the company (GCG in the perspective
In practice, the GCG implementation is continually
of a learning organization).
refined and strengthened, in particular as related
the companys capacity and value. As such, we can
to new initiatives to integrate governance risk and

compliance GRC management through business
performance management, GCG, risk management,
legal compliance and social responsibility, which
mutually support each other to realize growth and
business continuity.
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We realize that we must be able to anticipate business
Following is the 2003-2015 road map for the
dynamics. Therefore, several governance initiatives
application and reinforcement of GCG:
87
have been explored and designed to ensure the

organizations continuity, with the believe that GCG is
2003 2009
not a constraint, it is in fact able to support sustainable
Strengthening of GCG, Business Ethics, Distinct Job
company performance growth.
Manual (DJM) management, evaluation of policies

and procedures, human resources competencies
Our application of GCG has been recognized by
development, leadership development,
external assessor and investor perception, and we
strengthening of audit independence, and others, in
continue to strive to improve policies and system
support of compliance with SOA section 404 and
infrastructure to support GCG through new initiatives

to strengthen governance that we have grouped into
three main pillars:
section 302.
Implementation of integrated audit (financial audit
integrated with ICOFR audit).
Strengthening of IT governance.
1. Strengthening Governance Structure

Building governance initiatives to better strengthen
effective communication and relations between
Evaluation and mapping of policies, business and

operational processes.
Strengthening of governance structure involving:
company structures to prevent the potential of
strengthening of BoC/BoD and Audit Committee
agency problems and to achieve effective chemistry
Charter, revitalization of Executive Committees,
between elements within the Company while paying
development of Enterprise Risk Management
attention to checks and balances characterized by
(ERM), development of early warning reports,
speed and accuracy in decision making, making use

of the six eyes principle to ensure accountability
in business initiatives, implementation of notary
authority, and similar.
2. Strengthening Governance Processes
implementation of anti-fraud programs.

Strengthening of governance processes by ensuring
the existence of formal policies in all processes to
ensure responsibility and accountability.
Strengthening of governance structure
Building governance initiatives to further strengthen
through management initiatives, among others:
effective and efficient company management
implementation of regularization memos,
governance through the application of Enterprise
discrepancy reporting, and strengthening of
Risk Management, Integrity Pacts in business group

scope, strengthening IT governance, internal control
remediation, specifically internal control to ensure
the reliability of financial reporting, strengthening
leadership, etc.
3. Strengthening Culture
whistleblowing system.
Strengthening of governance processes to realize
risk management as a necessity in each process and
disciplined risk implementation.
Strengthening governance through an Integrity Pact
policy.
Instilling noble values through the application of

a corporate culture and business ethics as our
2010
capital in doing business with morals and integrity.
Strengthening of governance structures through
Our target is to educate employees with integrity
notarial deed policies and strengthening of The
and praiseworthy morals through the application
Telkom Way corporate culture.
of segregation of duties (SOD) in business

processes, leadership role modeling, ensuring the
Strengthening of governance processes through

risk management as a inherent culture.
implementation of trustworthy business ethics and

prudent practices, while strengthening corporate
2011
values.
Strengthening of governance structures through

initiatives building Telkom Group GCG with the
application of Telkom Group GCG Guidelines, as
regulated in Company Policy No. PD.602/2011.
Strengthening governance processes to ensure
risk management and compliance is effectively
implemented in the company.

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2012
accountability, responsibility, independence and
Strengthening governance structures by
fairness are applied at each level of the company.
empowering Telkom Group GCG, designing a GCG
This is aimed at mitigating the risk of conflict of
implementation check list and GCG self assessment
interest in the execution of the duties, functions and
guidelines for subsidiaries and establishment of
responsibilities of our BoC, BoD, management and
Directors of subsidiary companies as members
employees.
of the Telkom Group executive board and Telkom

Vice President, in accordance with duties and
Internally, the structure and procedure for GCG
responsibilities as Group Head in Telkom Group, as
implementation is regulated in the BoD Decrees on
regulated in Company Office Organization Policy
GCG Management Guidelines No. 29/2007 and
No. PD.202/2012.
No. 602/2011, which set out an integrated operational
framework to ensure that every transaction, both
business processes are in line with business
internal and external, is conducted in accordance with
transformation and organization transformation.
the code of conduct or best GCG practices. Every year

we evaluate the effectiveness of our implementation
2013
of this policy. At the same time, we also assure the
Strengthening governance structures through the
supervision of GCG implementation was conducted
development and implementation of GCG involving
independently and comprehensively to reach the
business groups by establishing the Board of
efficiency targets throughout the company, as well as
Executive as a framework to prepare the companys
safeguarding the companys integrity in the eyes of the
capability to take strategic steps in portfolio
authorities and the public in general.
management supported by parenting mechanisms

that are more suited to the demands of the business
ecosystem.
A. General Meeting of Shareholders (GMS)

Subject to our Articles of Association, the GMS,
comprising the Annual GMS (AGMS) and
business processes are in line with business
Extraordinary GMS (EGMS), constitutes our
transformation and the New Telkom organization
highest governance body and is the primary
transformation as per Telkom Group Company
forum through which shareholders exercise their
Office Organization Policy No. 202.11/2013.
rights and authority over the management of our

company. The AGMS must be held once a year,
2014
while an EGMS may be convened at any time, as
Strengthening governance structures through
needed.
GCG to implement the characteristics of a holding

company encompassing subsidiaries, through the
1. Telkom Shareholders
application of a Board of Executive mechanism and
We have two classifications of shareholder,
implementation improvements.
Series A Dwiwarna (as controlling shareholder)

and 97,100,853,599 Series B shares. For greater
Strengthening governance processes through the

disciplined application of ISO-based processes /
detail of our shareholders, please see Company
ISO certification for the New Telkom organization.
Profile Stock Overview Shareholder

Composition.
2015
Strengthening governance structures through GCG
assessment of subsidiaries.
Strengthening governance processes to ensure ISO
certification / surveillance.
2. Shareholder Rights and Responsibilities

In the AGMS and EGMS, shareholders are

entitled to equal treatment and standing,
particularly in expressing their opinions and
contributing to the process of taking important
COMPANY GOVERNANCE STRUCTURE
and strategic decisions in relation to:
In enhancing our GCG practices, we aim to improve
the election and termination of the BoC and
both the structure and the implementation process

and ensure that the principles of transparency,
the BoD;
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setting the amount of remuneration and

benefits of members of the BoC and BoD;
evaluating the Companys performance
during the year under review;
deciding on the use of the Companys profits,
including dividends; and
amendments to the Articles of Association.
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To give advice and opinions to the AGMS

regarding annual financial reporting,
development plans, the appointment of a
public accounting firm as the companys
auditor and other important strategic issues
related to the companys corporate actions.
To evaluate the companys work plan and
budget, to keep up with progresses made
The AGMS also has the authority to approve the
within the company, and to coordinate
Financial Statement and Annual Report. The
with the Board of Directors when there are
Government of Indonesia, as our controlling
indications that the company is in trouble,
shareholder and holder of the Dwiwarna Series A
thus allowing the Directors to immediately
shares, is required to be aware of its responsibility
inform the shareholders and to recommend
when exercising its influence over management

in voting sessions or on other matters. The
the necessary corrective measures.

To ensure that the corporate governance
Government has exclusive rights to approve
program is being implemented and
mergers, acquisitions and divestment, or to liquidate
maintained in accordance with prevailing
our Company based on decisions of the AGMS or
rules and regulations.
EGMS.
2. Board of Commissioners Composition

The mechanism for exercising voting rights by
The Board of Commissioners consists of 6 (six)
shareholders during an AGMS or EGMS provides for
people, a President Commissioner who serves as
shareholders to exercise their right to vote either in
leader and 5 (five) commissioners, two of whom
person or through their legal proxy.
are Independent Commissioners.

From 1 January 2013 to 19 April 2013, the BoC
B. Board of Commissioners
The Board of Commissioners (BoC) supervises
and advises with regard to companys management
consisted of:
1) Jusman Syafii Djamal, President
Commissioner.
by its Directors. The BoC is collectively responsible
2) Hadiyanto, Commissioner.
to shareholders. BoC members are appointed and
3) Parikesit Suprapto, Commissioner.
dismissed by shareholders through a GMS. The
4) Johnny Swandi Sjam, Independent
term of office for each member of the Board of

Commissioners is 5 (five) years from the date of
his/her election, unless the date of expiration of the
Commissioner.
5) Virano Gazi Nasution, Independent
Commissioner.
term of office falls on a day other than a workday,

in which case such term of office shall expire on the
On 19 April 2013, the AGMS approved
following workday.
amendments to the Companys BoC. As such,

per 19 April 2013, the composition of the BoC
1. Authorities and Responsibilities of the Board of

Commissioners
To supervise the Companys management
was as follows:
1) Jusman Syafii Djamal, President
Commissioner.
as implemented by the Board of Directors,
2) Hadiyanto, Commissioner.
including corporate planning and
3) Parikesit Suprapto, Commissioner.
development, operations and budgeting, and
4) Johnny Swandi Sjam, Independent
compliance with the companys Articles of

Association, as well as in the implementation
of the mandate and decisions of the
GMS. The Board of Commissioners is not
authorized to run or manage the company,
except in situations where all members of
the Board of Directors are suspended for a
certain reason.
Commissioner.
5) Virano Gazi Nasution, Independent
Commissioner.
6) Gatot Trihargo, Commissioner

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- The Nomination and Remuneration
3. Independence of the Board of Commissioners
Committee proposes such framework to
and Independent Commissioner

About
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BoC.
Membership of our BoC complies with prevailing
- The BoC then proposes remuneration for
legislation and capital market regulations
BoC members to the GMS.
regarding independence of BoC membership
- The GMS determines remuneration of BoC
and the number of Independent Commissioners.
members.
This is to maintain independence in the

BoCs supervisory role and to ensure the
implementation of checks and balances.
For the year 2013, the total remuneration of our
None of our BoC members are related by
Commissioners amounted to Rp18.3 billion, with
marriage or by blood up to the third degree,
each Commissioner receiving Rp3.1 billion.
both in a straight line or to the side (through

marriage). We have 2 (two) Independent
5. Board of Commissioners Activity Report
Commissioners, or 33% of the total members

of the Board. This exceeds the 30% minimum
a. Implementation of BoC Duties
limit set for independent commissioners by
In broad terms, during 2013, the BoC
the Indonesia Stock Exchange. The primary
engaged in the following matters.
task of independent commissioners, in addition
i. Gave its advice and asked for clarification
to oversight, is to represent the interests of
on the matters, including:
minority shareholders.
- changes to organization structure;

- ratification of RJPP/CSS 2014-2018;
4. Procedure to Determine Remuneration for the

- execution of the Work Plan and
Board of Commissioners
Budget (RKAP) including Capex for
Each member of the Board of Commissioners is
2013 and ratification of the proposed
entitled to monthly remuneration and benefits.
RKAP for 2014;
They are also entitled to bonuses based on
- international expansion to 10 countries
the Companys performance and achievement,
(Singapore, Hong Kong-Macau,
which amount is determined by the shareholders
Timor Leste, Australia, USA, Taiwan,
in the GMS. Commissioners are also entitled
Malaysia and Brunei, Saudi Arabia,
to a lump sum allowance upon resignation (at
New Zealand and Myanmar) as
the end of their term). BoC Remuneration
manifestation of the Telkom vision to
is calculated based on a formula set by the
become the leading TIMES player in
Nomination and Remuneration Committee
the region;
that is also used for the determination of

BoD salaries, and in percentage refers to
the President Directors salary that has been
- planned corporate actions related to

PT Indonusa Telemedia, Patrakom and
the establishment of InfraCo;
approved by the GMS. Pursuant to Minister of
- planned treasury stock transfer;
SOE Regulation PER-07/MBU/2010, the GMS
- Key Performance Indicators (KPI) for
could specify a different type of income and/
all members of the BoD as per the
or amount from that set out in this ministerial
Management Contract determined
regulation.
by the BoC, as part of the BoCs

assessment of each Directors
The procedure to determine BoC remuneration

is as follows:
- The BoC asks the Nomination and
performance;
ii. Provided a response to each periodic
report submitted by the Directors.
Remuneration Committee to draft a proposal
Provided a response on the 2013 Q1,
for BoC remuneration.
Q2 and Q3 Financial Reports, as well as
- The Nomination and Remuneration

Committee asks an independent party to
develop a remuneration framework for BoC.
communicating th response to the Seri A

Dwiwarna shareholder.
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iii. Executed BoC duties related to the

implementation of the GMS, namely:
A. Business Ethics

We believe that a good business principle is ethical

business, which refers to doing business sustainably
- discussed the AGMS agenda for fiscal
and with excellent performance, in compliance
year 2012;
- discussed the planned stock split;
with ethical principles on the basis of prevailing
- discussed and proposed a Public
laws and regulations. In line with Directors
Accounting Firm to conduct the
Decree No.KD.05/2005, we have a business
Financial Report for the fiscal year
ethics framework that defines the standards of
ending 31 December 2013; and
organizational behavior, as well as employee

behavior in interactions with customers, suppliers,
- discussed and proposed remuneration
contractors, colleagues, and other parties that
for the BoD and BoC.
interact with the company.

b. Board of Commissioners Meetings
The BoC holds a meeting at least once a
B. Implementation of the Code of Ethics by BoC,

BoD and Employees
month or when deemed necessary by one

or more members of the BoC, or upon
In compliance with provisions in the Sarbanes-Oxley
the written request from one or more
Act (SOA) 2002 section 406, we have a code of
shareholders holding at least one tenth of
ethics applicable to all levels of the organization,
the companys shares.
from the BoC and BoD and other key officers, to

all employees. This can be seen on our website at
The decision making mechanism in a
http://www.telkom.co.id/en/investor-relations/tata-
BoC meeting is based on consensus
kelola-perusahaan/kode-etik. All amendments and
by deliberation. If consensus cannot be
exclusions to this code of ethics will be posted on
reached, a decision is made based on
the website.
majority vote by members who are present

or represented. If there are equal votes for
C. Strengthening Business Ethics in Telkom Group
and against a decision, then the Meeting
In accordance with the direction of the
Chair makes the decision. In all BoC
development and implementation of GCG within
meetings, a quorum is defined as in excess
the Group, in the Telkom Group GCG Guidelines
of half of all BoC members in attendance or
(No. PD.602.00/r.00/HK000/COP-D0030000/2011)
represented by one attending Commissioner.
the Telkom Group code of ethics is defined to

strengthen our corporate culture
During 2013, the BoC held 13 meetings. The

BoC also held 14 joint meetings with the BoD.
1. Companies within Telkom Group strive to

be honest and to be role models for how to
conduct business in healthy, strong and fair
manner, driven by praiseworthy values, legally
CODE OF ETHICS AND CORPORATE

CULTURE
compliant, and respecting all stakeholders.

2. Companies within Telkom Group shall execute
Morals and ethics are the basis for GCG application
or manage their companies adhering to ethical
in a company, given than an organization is nothing
business principles and applicable legislation.
more than the people within it. Learning from our

management of GCG, in fact, GCG is in integral part of
conducting ethical business, and by building company
and employee awareness of social responsibility to the
3. Companies within Telkom Group implement

GCG principles that are beneficial and fair to
society, culture and the environment.
4. Any act against the law or breaching ethics
public to be good citizens we continue to move ahead
is forbidden, even if undertaken for business
and are loved by our customers.
reasons or while under pressure from any party.
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2013 Sustainability
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5. The company protects anyone who reports or
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is required to sign a statement of compliance with
provides information related to legal violations,
business ethics applicable at the Company. The
unethical behavior or other actions that violate
comprehension and practice of business ethics,
the principles of good corporate governance.
along with the results of the yearly survey, are

audited internally and externally through the SOA
Telkom Group employee Code of Ethics requires
404 audit process, related to the implementation
that employees:
of control environment in accordance with COSO
1. Act and carry out duties honestly and fairly.
framework on internal control audit at the entity
2. Place the interests of the Company above any
level.
personal or group interests.

3. Respect individual rights and diversity as a
source of strength for the Telkom Group.
E. Corporate Culture
Systems and cultures are continuously developed
4. Uphold the corporate culture.
to the demands and to cope with business
5. Safeguard corporate assets and maintain the
changes in order to realize our aspirations to
confidentiality of corporate information.

6. Produce quality products and provide the best
service to customers.
7. Pursue corporate profits and growth by
complying with the law and business ethics.
8. Are responsible for all personal decisions and
actions.
9. Uphold and enhance the reputation of the
continue to advance, be valued by our customers,

be competitive in our industry and be a role
model for other companies. In 2009, we began
the transformation to a new corporate culture
known as The Telkom Way. Our culture was
further developed in 2013 with the enactment of
the Telkom Group Leadership Architecture and
Corporate Culture (LACC).
Telkom Group.
10. Respect the public and the environment.
The Corporate Culture is fully described as follows:

- Philosophy to be the Best: Always the Best
D. Dissemination and Enforcement of Business
Always the Best is a basic belief to always
Ethics
give the best in every job we do. Always the
Dissemination and assessment are undertaken each
Best has the essence of Ihsan, which in this
year to instill and reinforce the comprehension
sense is translated as best. Employees who
of Corporate Values and Business Ethics by all
have the Ihsan spirit will always provide better
employees. The material distributed is related
results than expected, so the ihsan attitude will
to understanding GCG, business ethics, integrity
automatically be guided by a sincere heart. At
pact, fraud, risk management, internal control
this stage, it can be said that every activity we
(SOA), whistleblowing, prohibition of gratuities,
do is a form of worship to God Almighty.
IT governance, security of information, and other

matters related to the practice of good corporate
- Philosophy to be the Best: Integrity, Enthusiasm,

Totality
governance.

Always the Best demands all Telkoms people

have integrity, enthusiasm and totality.
The assessment, meanwhile, is carried out through

a Business Ethics Survey involving all employees as
survey respondents. This survey is implemented
- Principles to be the Star: Solid, Speed, Smart
online through the Companys portal/intranet
media. At the end of the survey, each employee
Principles to be the Star from The Telkom Way

is 3S, namely Solid, Speed, Smart, which are the
Core Values or Great Spirit. An explanation of
Solid, Speed, Smart is illustrated below:
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SPEED

SMART
One Heart
Starting Point
Intuition
Mental
One Mind
Setting Direction
Innovation
Reasoning
Impressive
Physical
One Action
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Taking Action
- Practices to be the Winner: Imagine - Focus Action

Practices to be the Winner in The Telkom Way is IFA, namely Imagine, Focus, Action, which are the Key
Behaviors. An explanation of Imagine, Focus and Action is illustrated below:
Always The Best (ATB)

It is the result of Imagine, Focus and Action
Imagine
Always The Best
I
F
Focus
Imagine
- Begin from the end
- The vision or dreams of a true
leader
- Start with what is desired, not
from what is feasible
A
Action
Focus
- First thing comes first
- Establish proof of progress
- Prioritize resources allocation
F. Evaluating the Implementation of Business Ethics
Action
- The world can only be changed
through imagination plus action
- A vision without action is just a
fantasy, action without vision is
just a momentary sensation
- Create quick wins
all employees quickly, and cover GCG, Business
and Corporate Culture
Ethics, The Telkom Way values, anti-fraud, internal
Every year we conduct an internal survey to
control, integrity pacts, whistleblowing system and
understand the effectiveness of Corporate Culture
others. The results of the survey for 2011; 2012 and
and Business Ethics implementation. We call this
2013 were 74.87 points; 79.07 points and 75.80
the Ethical Business Family Survey. Questions are
points out of a possible total 100 points.
posed to employees online, which allows us to reach
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WHISTLEBLOWING SYSTEM
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C. Parties managing complaints
As part of entity level control, since 2006 we have
The Audit Committee is the party that manages and
implemented a whistleblower program, which is
follows up on complaints received in accordance
designed to accept, study and follow up on complaints
with determined procedures.
from Telkom Group employees and third parties, and

which ensure the confidentiality of the reporting party.
D. Handling Complaints
The whistleblower program is managed by the Audit
In order to fulfill stipulations in OJK Regulation
Committee, determined by a BoC Decree and ratified
No.IX.1.5 and the Sarbanes-Oxley Act of 2002
by a BoD decree.
Section 301 regarding Public Companies, the

Audit Committee must be included within the
A. Submitting and Managing Violation Reports
GCG improvement framework. Therefore, certain
Telkom Group employees and third parties may
conditions for filing complaints are necessary
submit complaints related to accountancy and
to ensure that a complainant has full sense of
auditing problems, regulation violations, suspected
responsibility and does not intend to defame
fraud and/or suspected corruption, as well as
someones reputation.
violations of the code of ethics, directly to the

President Commissioner, or to the Audit Head of
The Audit Committee will follow up complaints filed
PT Telekomunikasi Indonesia, Tbk. by email, fax or
by third parties including, and especially those from

Telkom Groups employees relating to:
letter, addressed to:
- Accounting and Auditing

Email: ka301@telkom.co.id
Accounting and internal control problems
Fax : (62-21) 527 1800
related to financial reporting that might lead
Website : www.whistleblower.telkom.co.id
to material misstatements in the financial
Letter: Audit Committee PT Telkomunikasi
statements and audit issues, especially
Indonesia Tbk., Graha Merah Putih, 5 Floor
concerning the independence of the Public
th
Jl. Jend. Gatot Subroto Kav. 52 Jakarta 12710
Accounting Firm.
- Regulation Violations
Complaints must satisfy the following conditions:
Violation of capital market regulations and
by submitted by website, email, fax or letter;
laws pertaining to the operation of Telkom and
provide information regarding a problem
violations of internal regulations that could
with internal control, accountancy, auditing,
potentially harm the Company.
regulation violation, suspected fraud and/or
- Fraud/or suspected corruption
suspected corruption and violations of the code

of ethics;
the reported information must be supported by
Fraud and/or corruption by officials and/or

Telkoms employees.
- Code of Ethics
adequate proof that can be relied upon as initial
Detrimental behavior by Directors and
data to enable follow up.
Management that could ruin Telkoms reputation

or cause harm to the business. These actions
B. Protection of Complainants
The Companys policy on whistleblowing protection
could include: dishonesty, conflict of interest or

misleading information to the public.
is stipulated in BoD Decree No. KD.48/2009 to

accommodate and ensure the safety of employees
We have also established a working mechanism
and third parties who file complaints or report
between the Audit Committee and both the Internal
violations.
Audit and Investigations Committee, including

subsidiaries, to follow up incoming complaints. In
addition, the whistleblower program has also been
disseminated to and is understood by the majority of
employees.
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During 2013, the Audit Committee followed up on two complaints filed that fulfilled the stipulated conditions and
fell into the category of complaints related to accounting, internal control, regulatory violations, suspected fraud,
and code of ethics violations.
E. Whistleblowing System Procedure
WHISTLEBLOWING SYSTEM PROCEDURE

WHISTLE
BLOWER
THE AUDIT COMMITTEE / BOARD OF COMMISSIONERS
Website
Email
Fax
Letters
Initial Review
Does it have
anything to do
with BoD
PARTIES
Initial Review by the

Internal Audit
NO
YES
Report
YES
Does it need more
information
Accounting and Auditing

Violations on Regulations
Frauds and or Corruption
Code of Ethic
Investigative audit
and follow up
by Investigative
Committee
Initial Review
Formulating TOR and
Independent Auditor
Procurement
YES
NO
Does it meet the

procedure
NO
Investigative Audit?
Investigative audit
by Independent
Auditor
Supervision of the
Audit Committee
Report discussion
Follow up
YES
Report
BoC Opinion
Report and
recommendation
NO
Report to
shareholders?
Information
Documented
Shareholders
NO
BoD
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Consistent GCG Application
level with due attention to the SMART principle:
In our environment, understanding of GCG
Specific, Measurable, Achievable, Realistic and
continues to improve in line with the experiences
Time Related. Evaluation is conducted periodically
and learning we have attained during its
(daily, weekly, monthly, quarterly and annually)
implementation. Telkom strongly believes that GCG
according to performance indicators measured in
is a dynamic system that needs to be strengthened
the management review mechanism and supported
and renewed from time to time to adapt to changes
by various online information system applications.
in our business and the business environment.

Through continuous updating, instead of becoming
To complement policy No.PD.208.00/2011
a constraint, GCG implementation will provide real
promulgated by the HCGA Director, we have
contributions to our business growth.
passed regulation No.PR.208.01/2012 regarding

the Employee Performance Management System
Our GCG implementation is integrated with the
Application Guidelines which principally measures
management of compliance, risk management and
employees individual performance and individual
internal control. This practice requires us to be able
competencies (core competency and specific
to manage GCG in alignment with the management
competency). The individual performance
of our business performance. Initially, implementing
assessment refers to realization of the management
risk management was not easy, requiring time
contract and employee competencies assessment
to master the competencies, achieve accuracy
using 360 degree assessment by the relevant
in recognizing industry and organizational risks,
employee, the employees supervisor, subordinates
and embedding a culture of risk awareness within
and colleagues. Both these assessment processes
employees.
are performed online using web-based information

system applications through our portal/intranet.
However, thanks to the commitment, consistency

and patience of the management, risk
B. Implementing the Integrity Pact and
management is now making a very positive
Strengthening the Anti-Gratuity Policy
contribution to the planning and decision making
Consistent implementation of the Integrity Pact
processes, and reinforcing GCG implementation
started after the policy was issued in 2009 to refine
in Telkom Group. Several key activities have
GCG implementation, particularly in relation to
been implemented consistently to support GCG
GCG implementation of the integrity code, business
practices and ensure alignment with management
ethics, avoiding conflict of interest, prohibition on
of the business, such as:
gratuities, prohibition on insider trading, information

confidentiality, preventing actions intended for self-
A. Performance Management System
enrichment or the enrichment of another party that
To implement GCG, particularly accountability,
could cause the company financial loss in the areas
we manage our accountability for our employees
of procurement and partnership, service integrity
performance through an Employee Performance
and financial reporting integrity.
Management System, as stated in Company

Policy No.PD.208.00/2011. In accordance with the
Although the Company already practices GCG, it
purposes and objectives of this policy, the principles
is important to allot particular attention to certain
of objectivity, fairness and transparency are applied
areas to prevent potential financial loss to the
by referring to the guidelines on responsible
Company and to create islands of integrity as
performance measurement and assessment in
one of the instruments of bureaucracy reform and
the management contract mechanism using
the to prevent collusion, corruption and nepotism
performance indicators according to the scope
(KKN) by concentrating on measures to create
of work and role of each unit and individual
openness, accountability and participation. The
within the organization and the setting of agreed
direction of the President Director and signing of
targets that refer to the Companys performance
the Integrity Pact in the presence of Telkom Group
targets. Performance targets are formulated on
senior leaders.
the basis of the annual corporate plan and are

broken down to the unit, sub unit and employee
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C. ISO-standard Process Management
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E. Application of IT Governance
Since 1996 we have consistently applied ISO-based
As a company engaging in business information
quality management systems and in 2001 integrated
and data provision for customers, for which security
this with the Malcolm Baldrige-based performance
must be guaranteed, we always strive to maximize
excellence criteria. Our application of these two
the use of technology in managing the company,
quality management systems (ISO and Malcolm
since it will directly contribute to the improvement
Baldrige) is aimed at establishing governance
of good corporate governance implementation.
processes and accountability performance through
Almost all points in our corporate value chain, which
disciplined processes and proper documentation
covers the network operation of all production
based on ISO and improving performance
equipment infrastructure, all important aspects
excellence as refered to in Malcolm Balridge
of management such as finance, logistics and
performance excellence assessment. In 2013, Tellom
human resources, including services to employees,
was assessed as having excellent performance by
customers, suppliers and other stakeholders, have
the KPKU assessment team from the SOE Ministry
been integrated into the IT network.
and internally conducted self assessment at the

Business/Division Unit level. Assessment went well,
F. e-Procurement Application
was accountable, transparent and able to add value
As a manifestation of our commitment to GCG
to business sustainability, while avoiding conflict
and Integrity Pact implementation, we have
with with stakeholder interests.
been consistent with our application-based

procurement and partnership management to
D. Governance Implementation
curtail physical contact between suppliers/partners
Consistency in planning management is a key
and the procurement committee, as all tenders
concern for management in implementing GCG.
and negotiations are computer-based to ensure
According to Company policy, the management
they are fair and transparent. We select suppliers
strives to ensure that corporate planning is
through three main stages: the supplier registration
systematic, simple, organized, integrated, aligned
stage in which suppliers register online through the
with the corporate vision and mission, and can be
Supply Management and Logistic Enhancement
properly executed according to plans. It should also
(SMILE) application, followed by the Selection
facilitate evaluation and control when applied.
stage, in which we assess suppliers depending on

their business classification and other criteria to
The corporate planning model comprises three
create a supplier ranking and short list. Finally,
phases:
we determine Eligible Bidders, who are suppliers
1. aligning stakeholder expectations;
eligible to bid or to engage in the procurement
2. formulation the corporate strategy (strategic
process. There are several benefits of this system,
formulation); and
3. implementation of the business strategy.
including the speed of the tender process, the

electronic selection of tender participants according
to specified requirements, electronic selection of
The role of GCG is to guarantee and ensure that
the winner, and other benefits related to enhanced
the entire planning process and related activities
quality of the process, reasonable prices, fairness,
are carried out effectively, responsibly and
transparency and the absence of any intervention.
transparently and are able to deliver sustained

added value to the company, while avoiding any
conflict with the interests of the stakeholders.
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2013 Sustainability
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G. Human Resource Competence Development
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activities that become intangible assets, such as
The change in the business portfolio from TIME to
innovations, through our portal http://inovasi.telkom.
TIMES has had implications for and shifted required
co.id, which can be accessed by all employees.
competencies. The competence and abilities of

our human capital is one of the most significant
GCG Assessment
elements in the application of GCG.
GCG performance achievement is monitored

through annual evaluation by IICG, an independent
H. Management of Information Ownership and

GCG ratings institution in Indonesia. IICG routinely
Intangible Assets
conducts research and CGPI rankings of publicly listed
Information and all intangible assets, including
companies, SOEs and other companies that are not
research, technologies and intellectual property
publicly listed or SOEs. The assessment process and
rights earned through assignments within and/
CGPI rankings encompass four stages with differing
or at the expense of the company are the
weighting values:
property of Telkom. We have a regulation,
1. self assessment stage, the company is asked to
No.PD.605/2011, related to the Management of

Intellectual Knowledge and Intellectual Property
Rights. Through the protection and management
complete a questionnaire in accordance with the

GCG theme being assessed;
2. document observation stage, the company
of intellectual property, we expect to be able to
submits its policies, procedures and other evidence
increase revenue and maintain our competitive
demonstrating the implementation of GCG in the
advantage. Creativity and innovation with regard

to new and existing products and services is a
company;
3. assessment stage, papers and presentations
corporate asset and is also safeguarded. We
are assessed in which the company explains its
manage a database of creations, brands, industrial
activities to implement GCG in accordance with the
designs, inventions, trade secrets, copyrights,
assessment theme and presents papers to a jury
trademarks, industrial design rights, patents and
board; and
rights to trade secrets. We routinely manage various
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4. observation stage, in which the IICG juries visit

the company to ask questions, observe and visit
locations to study with certainty the application
of GCG as it refers to the self assessment results,
document and paper observation.
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Corporate Governance practices in a publicly listed

company in Indonesia;
4. awarded 2nd place for The Best GCG Implementation
by Anugerah Business Review;
5. awarded The Best GCG Implementation by
Anugerah BUMN; and
As a result of all this hard work, Telkom has achieved
6. awarded Corporate Governance Perception Index
best ranking as The Most Trusted Company in
The Most Trusted Companies 2013 as the most
accordance with the GCG theme for 2013, which was
trusted company by IICG in cooperation with SWA
GCG from the Knowledge Perspective. In addition
Magazine, based on a survey of investors, analysts
to our IICG assessment, we are often selected by
and fund managers.
other ranking institutions for observation as we are

considered one of the benchmarks or role models for
other companies.
Some of our assessment achievements are as follows:
1. ranked 1st for Most Committed to a Strong Dividend
Policy in Finance Asia Best Companies Award 2013;
2. awarded Best of Asia in the Asias Icon on Corporate
Governance category in Corporate Governance Asia
Annual Recognition Award 2013;
3. awarded Best Corporate Overall by Indonesian
Institute for Corporate Directorship (IICD) regarding
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The Future of Indonesias Telecommunication

Industry
102
Universal Service Obligations and

Competition
103
Fulfilling Customer Needs and Improving

Customer Satisfaction
104
Marketing Strategy and Customer Privacy
107
108
Improving Service Quality
109
Handling Customer Complaints
110
Customer Satisfaction Surveys
111
Consumer Protection
111
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Telkom is committed to providing high

quality and efficient TIMES products and
services, easy and convenient access,
exceeding customer expectations, continuing
to maintain privacy and settle all complaints,
ensuring business continuity and long-term
performance growth
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THE FUTURE OF INDONESIAS TELECOMMUNICATION

INDUSTRY
The telecommunication data
On 8 September 2000, the government deregulated telecommunications
is heading toward HSPA+, Wi-Max
through the enactment of Telecommunication Law No. 36/1999 and its
and Long Term Evolution (LTE)
implementing regulations, ending the era of the PT Telkom (Persero) Tbk
technologies. The need for data
and PT Indosat (Persero) Tbk duopoly. This development resulted
transmission services continues
in telecommunication services becoming a promising economic
to rise and is not limited to voice
sector and highly competitive. Subsequently, competition between
communication, short messaging
telecommunication service providers increased, particularly in relation to
service (SMS) and mail messaging
GSM-based cellular connections.
services (MMS).
The government, through the Communications and Information Ministry,
Overall, growth in the Indonesian
strives to regulate the industry to ensure healthy business growth, so that
telecommunication industry is
each operator is able to contribute to national economic growth. Indonesia
expected to continue to increase
has a large population, with relatively stable economic growth, and offers
into the future, based on the
significant opportunities for growth in the telecommunication market.
following considerations:
technology road map for the future
the Indonesian economy relies
Meanwhile, Indonesias economic growth has also resulted in rapidly rising
on domestic demand to grow.
demand for telecommunication services. This has stimulated investment
The geographical condition of
by service operators to meet market demand. The operators continue to
this island nation encourages
innovate to provide high quality telecommunication products and content,
increased demand for
as well as data transmission, in line with technological development and
telecommunication services,
supporting infrastructure.
in particular data transmission,

to improve business efficiency
and effectiveness.
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G4-SO7
the continuing migration to
Informatics, Director General of
In accordance with Decree
wireless telephone networks
Postal Services and Informatics,
of the Communication and
with data transformation ability
and a third party representing
Information Ministry No. 32/
rising due to the support of
the government appointed by the
PER/M.KOMINFO/10/2008 dated
improved wireless network
Communications and Information
10 October 2008 regarding USO
quality and the availability of
Minister), and is led by the Director
(amended by Decree of the
cellular telephones with service
General of Postal Services and
Communication and Information
features providing ease of
Informatics.
Ministry No. 03/2010 dated

1 February 2010), operators
mobile data access becoming

more economical; and
In accordance with Government
are required to contribute
the consistency of government
Regulation No. 52/2000,
to the provision of universal
regulation reformation allows
telecommunication services are
for new players to join the
divided into three categories:
infrastructure. Contributions are
telecommunication business.
telecommunication network
generally the provision of finances/
providers;
funding. These funds are used to
telecommunication service
pay for telephone service costs,
providers; and
SMS and internet access in remote
special telecommunications
areas where it is not economically
providers.
viable for operators to provide
UNIVERSAL SERVICE
OBLIGATIONS AND
COMPETITION
such services. The purpose of this
Following the enactment of

Law No. 36/1999 concerning
The opening of the
is to facilitate even development
Telecommunications, provisions
telecommunication sector, which is
of information and communication
to regulate implementation of
in the public interest, has resulted
services across Indonesia.
in intense competition. For
resulted in an independent
this reason, a minimum service
In addition, telecommunication
regulatory body being established
standard had to be applied to
service providers are bound
by the Communications
all operators. To create healthy
by regulations governing the
Ministry through Decree of
competition in accordance with
construction of telecommunication
the Communications Minister
the Telecommunications Law, the
towers, with permits being
No.KM.31/2003 dated 11 July 2003
relevant government agencies
regulated by both central and local
regarding the establishment of the
regulated the implementation
government. These regulations are
Independent Telecommunication
of basic standards for
intended to prevent monopolistic
Regulatory Board, ITRA, in
telecommunication and related
practices in the area of the
Indonesia.
services under the Universal
ownership and management
Service Obligation (USO). The
of telecommunications towers.
ITRA has the role of implementing
purpose of the USO is to create a
In further developments, a
the policies determined by the
competitive market, which is fair
number of regional authorities
Communications and Information
and also protects consumers.
have implemented regulations

restricting the number and location
Ministry, including those related

to licensing, standardization,
Universal Service Operator (USO)
of telecommunications towers
interconnection costs, business
As per the USO, all operators
and requiring operators within
competition and conflict
must be able to guarantee
the telecommunication services
settlement. At this time, ITRAs
consumer protection with
sector to share the use of these
role tends more toward supervision
regard to service quality, service
telecommunication towers.
of the clearing process and
costs, compensation and other
interconnection settlement.
matters. Consumers who feel they
Competition and Pricing
Membership of ITRA consists of
have been disadvantaged by a
As part of the implementation of
nine people, six representing the
telecommunication service provider
Law No. 5/1999 dated 5 March
public and three representing the
can submit a claim based on the
1999, which regulates Prohibition
government (Director General of
prevailing regulations.
of Monopolistic Practices
Resources, Postal Equipment and
and Unhealthy Competition
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(the Antimonopoly Law), the
Telkom), Indosat, XL Axiata, Hutchinson, Natrindo, Smart Telecom
government has established the
and Bakrie Telecom. The total number of cellular phone users as of 31
Business Competition Supervisory
December 2013 amounted to 310 million, an increase of 12.3% over the
Commission (KPPU), which serves
276 million at the end of 2012.
as Indonesias antimonopoly
supervisor and has the authority
Empirical studies by telecommunication experts show there will be an
to implement the provisions of the
increasing tendency in the future for the use of mobile cellular-based
Antimonopoly Law.
telecommunications as compared to other types. Therefore, in order

to ensure the continuity of their businesses, operators are increasingly
In addition, the Communications
focused on these services. As a result, the level of competition in this
Minister, through Decree
segment continues to rise.
No. 33/2004, has prohibited

dominant service and network
In Indonesia, both prepaid and post-paid cellular service customers are
providers from misusing their
very price sensitive and often take advantage of lower cost services
position through dumping,
when possible. Falling prices result in a rising number of customers and
setting unrealistic prices, cross
network traffic, ultimately impacting with increasing inter-operator network
subsidies, the abuse of services,
congestion.
and the deliberate blocking of

vital interconnections (including
Despite the high level of competition in the telecommunication business,
discrimination against specific
in particular the cellular telephone segment, Telkom continues to comply
service providers). The
with all prevailing legislation and regulations governing competition and
government has also established
operations in the sector. Telkom has never violated any relevant provisions
pricing guidelines for all services
and consistently places customer satisfaction as a primary goal of service.
offered by telecommunication
service providers in order to ensure
Telkom is committed to making customer satisfaction a primary goal and
healthy competition.
consistently implementing this in an environment of healthy competition.

To demonstrate this commitment, Telkom has implemented a series of
These rules and regulations set by
efforts involving focused research and development, marketing strategies
the government have successfully
targeting specific customer segments, intensive communication with
created an open, competitive
customers and genuine customer complaint resolution services.
telecommunication service market

between service operators and
divided into two services, namely:
FULFILLING DEMANDS AND IMPROVING CUSTOMER

SATISFACTION
1. for services involving fixed
Telkom believes that its customers play a vital and strategic role as
wired telephones and fixed
stakeholders for business continuity as well as increased economic
wireless telephones, as well as
performance in each operational period. Therefore, Telkom always
Long Distance Connections,
safeguards customer satisfaction to overcome competition and fulfill
competition involves two
customer demands and expectations. Telkoms strong commitment to
fulfilling the demands and expectations of its customers is implemented
providers, Telkom and Indosat;
through two key programs:
and
1. Fulfilling Customer Demands
content providers. Competition is
2. for cellular services, competition
The result of this positive interaction indicates that the following three
is fierce and involves a greater
matters are customers main concern: sustainable connection quality,
number of operators, including
service that exceeds expectations and added value for customers.
Telkomsel (a subsidiary of
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index
To fulfill these demands, Telkom
national and community
has realized a product and
economic growth;

Telkom is striving to build a

high quality infrastructure
b. adherence to a strict code
service development program
105
that is efficient and cost
under its TIMES portfolio.
of ethics governing the sale
competitive to provide high
Telkom is able to rely on its
of products (direct sales),
quality TIMES services overall.
innovative new products and
promotions, and advertising;
This network development
c. adherence to ethical
services, ensure that these
is being conducted through
products meet customer
advertising practices that
construction of the Indonesia
demands and can be used
conform to the code of
Digital Network (IDN), which
economically. To ensure all
advertising ethics prevailing
includes targeting construction
this, Telkom implements an
in Indonesia;
of 20 million household
incubation period that consists

of the following stages: idea
submission, customer and idea
d. ensuring easy access to our
connections (home pass) across
products and post-sales
Indonesia in 2015, the provision
services by the public; and
of telephone services (voice),
validation, product validation,
e. promoting the principles
business model validation and
and practices of healthy
IDN program, which started in
market validation.
competition.
2012, is intended to support the
IPTV and broadband. The
National Broadband Network

By implementing these
As manifestation of these
development, which itself is
steps, Telkom ensures
principles, we designed and
part of the Master Plan for the
that new product/service
realized a series of strategies and
Acceleration and Expansion
development will provide
operational programs to ensure
of the Indonesian Economy
the best services that are
customer demands are fulfilled,
(MP3EI).
optimum for the Company.
as well as our customer-related
Meanwhile, customers are
objectives, as contained in the
able to benefit from quality,
following brief description.
of three programs, namely
reliability, availability, billing and
A. Network Development
id-Access, id-Ring and id-
payment facilities, service reach,
Telkom allocates an increasingly
Convergence, which are being
compatibility, product features
large capital expenditure
implemented through synergy
and readiness factors for
budget for network expansion
within Telkom Group and
product support aligned with
to support the cellular business
cover all layers of network
their requirements.
to keep up with increasing
infrastructure. In 2013, Telkom
demand for broadband-based
had built and was operating:
(i) high speed optical access
2. Telkoms commitment to
The IDN program consists
conducting operations in a
(data and information services).
network through an optical
manner that ensures customer
This capital expenditure is
fiber network and Wi-Fi for
satisfaction is expressed
used to ensure and improve
id-Access;
through the implementation of
connection quality for all
the Telkom Integrated Quality
telecommunication service
Assurance (TIQA) program,
segments. As an illustration,
which forms part of our ROSE
from Telkoms total Rp24.9
provision of various id-Con
(Raise on Service Excellence)
trillion (2012: Rp17.3 trillion)
services.
framework, which mandates:
capital expenditure in 2013,
a. adherence to the principle
approximately 35.2% (2012:
(ii) IP and optical backbone

network for id-Ring; and
(iii) integrated NGN for the
As a result, network
of ensuring that all products
50%) was allocated to radio
development is taking
and services create the
access network development to
place to support all Telkom
highest possible level of
support the cellular business.
services, including:
benefit to users, promoting
106

2013 Sustainability
Performance
Overview
About Telkom
About
This Report
line with applicable regulations.
a. Fixed Telephone
Telkom Shares
For the telecommunication
and Transmission
This has assured that Telkom
network infrastructure, research
Connections, namely:
has not been subject to any
being conducted includes
- Fixed line network;
monetary fines and sanctions
that related to NGN, IMS,
- Fixed wireless network;
related to products and
Service Broker, 100G, QoS
- Transmission networks.
services.
Transport, Supercore, Any

Wire GPON/10GPON, Wi-Fi,
b. Cellular networks;
c. Data and internet
networks; and
In the 2013 reporting year, the
Femtocell, QoS EVDO, GPS and
research and development
IPv6 technology.
budget has been primarily
d. International networks.
allocated to various programs
C. Trademarks, Copyrights and

Patents
aimed at supporting mobile
This network development
To meet the rising levels of
program is being implemented
broadband, cloud computing
to improve connection quality
and several ecosystem-
customer demand and the rapid
both in terms of successful
based solutions, such as
rate of development in the
connection and voice clarity,
e-tourism, mobile payment,
telecommunication technology,
transmission quantity and
mobile game and smart
Telkom always innovates
data transmission speed.
home. These programs, all
products and services in line
A full description of these
together, are aimed at creating
with our dynamic business
network development
a digital lifestyle in Indonesia.
portfolio. To protect and
programs for 2013 can be
Developments include business,
respect creativity resulting from
found in the 2013 Telkom
product and service aspects,
research and development, we
Annual Report.
as well as telecommunication
have registered a significant
network infrastructure.
amount of intellectual property

rights, including trademarks,
B. Research and Development

For the business, services
copyrights and patents with
to invest in product research
and product aspect, research
the Directorate General for
and development to improve
and development conducted
Intellectual Property Rights
network connection quality,
includes business research on
under the Indonesian Law and
meeting customer demand for
a mobile advertising center,
Human Rights Ministry.
high quality product variety,
app store, smart home (home
as well as to innovate on
monitoring, telemetering,
products and services that have
wireless sensor network,
reached saturation level in the
smart home over power line),
including:
production and marketing cycle.
mobile payment, data center,
(i) trade brands associated with
Telkom provides a budget
Economic
Growth
Telkom has registered

intellectual property rights,
e-tourism, games, intelligent
the Companys products and
Total funding disbursed during
car, map-based social media
services, domain names and
2013 amounted to Rp14 billion,
platform, e-learning content
equivalent to US$1 million (2012:
enrichment, Telkom game
Rp13 billion or equivalent to
center, over the topTV, smartTV,
Companys name logo,
US$1 million). Telkoms purpose
speedy monitoring, smart home
product and services logos,
in conducting this research and
over power line solutions, 4G
computer programs, written
development is also to confirm
LTE smart devices, business
material and songs; as well
that the services provided are in
signaling, TENOSS and TCEM.
as
logos;
(ii) copyrights for the
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
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Customers
GRI G4
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107
G4-PR7 | G4-PR8
(iii) simple and standard patents
MARKETING STRATEGIES AND CUSTOMER PRIVACY
for inventions in the fields
In the context of the potential for ongoing growth, the tight regulatory
of technology, products,
environment governing the provision of TIMES services, and the high level
telecommunication systems
of competition, we have implemented a range of marketing strategies
and methods.
to strengthen our brands and product/service profiles. Marketing is

conducted through advertising in both printed and electronic mass
In 2013, Telkom registered 6
media, direct marketing to clients and individual distribution, as well as
new trademarks, namely:
special promotional campaigns. This marketing strategy is part of the
1. U See Zone
realization of three key strategic initiatives that have been adjusted to
2. UTV
reflect 10 strategic initiatives outlined in the discussion of the Companys
3. U Zone
Vision, Mission and Strategic Initiatives. To ensure increased market
4. U
share and maintain and improve customer satisfaction, Telkom strives
5. U meet me
to fulfill customer demands for reliable products and services that are
6. Indi Home
easy to understand and use, as well as providing ease of access and

mechanisms to settle customer complaints. In addition, Telkom upholds
In addition, Telkom has received
the provision of best service through full compliance with prevailing
trademarks registered in 2013
regulations, safeguarding customer privacy and providing consumer
for:
protection. As a result, in the reporting period, Telkom has not received
1. Speedytrek Xpose Ur Music
any sanctions for infringements of regulations governing the provision of
2. Speedy Grovia
telecommunications services or customer privacy.
3. DELIMA
4. TELEPON RUMAH
Telkom is committed to innovating products and services other than
5. Flexi-Lebih Irit kan
telecommunications through reliable TIMES services. We always strive to

create products and services that are able to anticipate rapid content and
device developments (smart phones, personal computers and tablets).
Telkom is also developing joint services, combining voice communication,
data service via internet and IPTV into one package called Triple Play.
Our innovative products and services are very different, giving Telkom a
competitive advantage with Time to Market and positioning Telkom as a
prestigious service provider in the years to come.
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Telkom always provides clear
To provide ease of access to Telkom products, both for corporate
and detailed information on
customers and individuals, including voice services and data and
usage, customer rights and
information services, the Company has developed a distribution and
responsibilities, commitment
product marketing network, as detailed in the following text.
to customer protection and

guaranteed service reliability,
MARKETING COMMUNICATION
methods of lodging a complaint,
Telkom believes that efficient and proactive communication with its
product and service price and time
customers plays an important role in business continuity, as well as being
validity, labeling certain products
beneficial in ensuring standards of product and service quality. Effective
(e.g. pre-pay vouchers) and when
marketing communication plays an important role in ensuring products
service contracts are signed, for
being marketed reach the targeted segment and potential customers. For
all the products and services
this reason, Telkom designs and implements a marketing communication
it markets. Telkom is also very
strategy that complies with regulations and legislation, as well as industry
careful about brochure content and
standards related to advertising, promotion and sponsorship.
advertising broadcasts to comply

with all prevailing regulations.
Marketing communication includes that conducted through print and

television media, direct marketing to customers and distribution personnel,
All our products and services being
infrastructure and special promotion campaigns through various marketing
marketed are priced in accordance
communication programs designed to strengthen our brands and our
with regulations mandated by the
profile in the eyes of the public. The Company strives to understand the
Government of Indonesia, based on
character and demands of our customers and end users to ensure the
Law No. 36/1999 and Government
suitability of the products and services being marketed.
Regulation No. 52/2000,

which determine tariffs for
To ensure that marketing communication is effective, our subsidiary,
the provision of network and/
Telkomsel, promotes its Kartu Halo cellular product to high users in the
or telecommunication services
corporate and professional segment. Meanwhile, the targeted market for
are determined by operators
simPATI and Kartu As cellular products is wider, aimed more at a younger
based on tariff type, structure
generation, and as a result advertising is both above and below the line,
and referring to pricing limits for
with campaigns in schools and certain communities, as well as advertising
telecommunication determined by
in print and electronic media to increase brand awareness.
the government. Therefore, rather

than relying on pricing to attract
Meanwhile, the Speedy product, with its extensive reach to young people,
customers to use our services, we
households and the retail segment, is also marketed above and below the
rely on our advantages in high
line, with campaigns to schools, certain communities, print and electronic
quality interconnection thanks to
media, personal approach through direct contact by telephone and
network support, ease of access to
brochure.
products and customer services.

Telkom always complies with applicable regulation, such that during
2013 there were no infringements of regulations or legislation or industry
standards related marketing communications, advertising, promotion and
sponsorship.
To facilitate ease of customer access, as of the end of the year, Telkom
was cooperating with 53 official dealers who manage 83,000 retail outlets
divided into 96 clusters. Telkom also cooperates with 7 National Retail
Partners and 17 National Banking Partners.
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
IMPROVING SERVICE
QUALITY
To ensure improved customer
Prioritizing
Customers
GRI G4
Core Index

as not charging the subscriber
Meanwhile, internally, Telkom
fee for a certain period of time;
applies an inter-Telkom Group
2. for corporate customers,
109
Service Level Agreement/SLA, as
service quality, Telkom applies
service levels are guaranteed
defined in Company Regulation
both external and internal
in accordance with the
No:PD.510.00/r.00/HK.200/
approaches. Externally, Telkom
contractual agreement
COD-D0030000/2012 regarding
offers a service level guarantee,
between the Company and the
Telkom Group Service Level
which is a minimum level of service
associated customer. Service
Guarantee (SLG) and Service Level
guaranteed to personal and
guarantees are also provided
Agreement (SLA) Procedures. As
corporate customers for products
to other operators and certain
stipulated in this regulation, the
and services.
wholesalers using the SL Digital,
purpose of the SLA is to support
IP Transit and Metro-E products.
proper implementation of the SLG.
The external approach:
Guarantees provided are in
1. for personal customers, this
line with service level, product
Telkom clearly details the role of
program is offered to fixed
availability, installation and
each unit and the targets to be met
line telephone, Flexi, data and
repair times.
to achieve the mutually agreed SLA

SLG regulations are strengthened
internet customers. Service

Telkom groups its service levels
with the implementation of
for customers wanting new
into five categories (Bronze,
SLA internally and demonstrate
connections, a change in
Silver, Gold, Platinum and
Telkoms commitment to
service, service disruption
Diamond), each providing
placing customer satisfaction
settlement, and restoration
different levels of guarantee
as a benchmark for operational
of cut services and billing
based on technical parameters,
success achieved through efforts
complaints. In cases where the
features provided, product
to improve service quality in a
minimum level of service is not
being used, and the value of the
measured and sustainable manner.
achieved, Telkom will provide
contract.
guarantees are provided
non-cash compensation, such
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Telkom Shares
Another method used by Telkom to
To ensure post-sales service standards are maintained, Telkom provides
improve customer service quality
fair compensation through a service level guarantee/SLG). This post-sales
is to facilitate bill payment for all
guarantee demonstrates Telkoms commitment to improved customer
Telkom services. In cooperation
service quality.
with banking institutions, we have

designed a flexible billing system
suited to service characteristics and
HANDLING CUSTOMER COMPLAINTS
customer segment and supported
Telkom provides facilities and infrastructure to support customers wishing
by the telecommunication system.
to complain about products and services that do not meet the advertised
standard. Telkom divides complaints into two groups.
Overall, all payments for Telkom

services can be made online,
or through mobile devices.
This demonstrates Telkoms
commitment to supporting
1.
Personal Customer Segment

a.
Telkom provides a customer service center, known as Plasa

Telkom, in every regional and branch office, which customers can
visit.
b. Telkom also provides a complaint center online on the Companys
the developing role of
website, as well as the 147 call center telephone service. For
telecommunications as an effective,
cellular customers, Telkomsel has a call center named Caroline,
time efficient and mobile method
which is an abbreviation of Customer Care Online. Caroline can
of driving Indonesias economic
be contacted through the following numbers:
growth.
133 for Kartu Halo subscribers;
155 (24 hours, free) and 188 (24 hours, paid) for simPATI
and Kartu As subscribers;
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

111
G4-PR4 | G4-PR5
021-21899811 in Jakarta, 022- 2553811 in Bandung, 031-
ensuring the products
8403811 in Surabaya, 061- 4578811 in Medan or 0807-
and services created are
1811811 for all other locations in Indonesia from cellular
of high quality, able to
phones served by other operators or from fixed lines.
provide maximum benefit

and contribute to economic
2. Corporate Customer Segment Telkom has an account management

team to manage relations with corporate customers, which is backed
growth;
-
up by Telkom Solution House, the SME center and call center. Telkom
for direct sales, advertising and
provides the number 500250 for business customers and a toll

free special service for enterprise customers on 08001Telkom
maintaining a code of conduct

promotion;
(08001835566).
implementing ethical
advertising practices based
on the advertising code of
Telkom has clear policies related to settling customer complaints.

Generally, complaints concern the compatibility of information in
conduct in Indonesia;
-
ensuring products and post-
brochures and actual products and are settled in under 24 hours. However,
sales services are easily
settlement of complaints related to administration and inappropriate tariffs
accessible to the public;
and product applications require more time due to the verification process.
supporting the principles

and practices of healthy
CUSTOMER SATISFACTION SURVEY

We realize the importance of understanding the level of customer
competition;
-
satisfaction for all our services and make use of a feedback survey to
improve future levels of service. To this end, Telkom cooperates with an
focusing on customer
satisfaction; and
fulfilling the benchmarks
independent survey company to conduct research. The aim of the survey
required in several Ministerial
is to identify the Customer Satisfaction Index (CSI) and Customer Loyalty
Regulations that regulate
Index (CLI).
service quality standards.
Using the Top Two Boxes and top three boxes with seven scales method,
the following survey results were obtained:

personal customer segment: 80.16% CSI and 67.64% CLI;
business customer segment: 91.23% CSI and 87.27% CLI;
enterprise customer segment: 94.28% CSI and 97.26% CLI.
CUSTOMER PROTECTION
Telkom continues to pursue a variety of initiatives and improvements for
product safety, service complaints and after-sales guarantees to provide
comfort and ensure consumer protection, among others, by:
-
implementing standard guidelines for the product innovation

incubation process to ensure a newly developed product can become
a suitable product for commercial use and be well received in the
market;
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Telkom Shares
Independent Assurance Statement

Report No. 0914/BD/0071/JK
To the management of PT Telekomunikasi Indonesia
(Persero), Tbk
We were engaged by PT Telekomunikasi Indonesia
(Persero), Tbk (Telkom) to provide assurance in
respect to its Sustainability Report 2013 (the Report).
The assurance has been carried out by a multidisciplined assurance team with a broad range of skills
and depth of experience, thus providing a high level of
competency for the assurance engagement.
Independence
We were not involved in the preparation of any key part
of the Report and carried out all assurance undertakings
with independence and autonomy. We did not provide
any services to Telkom during 2013 that could conflict
with the independence of assurance engagement.
Assurance Standards
We conducted our work in accordance with ISAE3000
Assurance Engagements other than Audits or Reviews
of Historical Financial Information issued by the
International Auditing and Accounting Standards Board.
In addition, we have also planned and carried out our
work in accordance with AA1000AS (2008) AA1000
Assurance Standards (2008), issued by AccountAbility.
Level of assurance and criteria used
Our evidence-gathering procedures have been designed
to obtain a limited level of assurance based on SAE3000
and a moderate level of assurance engagement as set out
in AA1000AS (2008) in order to provide confidence to
readers by reducing risks or errors to a very low but not
to zero. Moreover, the AA1000 AccountAbility
Principles Standard (2008) of Inclusivity, Materiality
and Responsiveness has also been used as criteria to
evaluate the Report.
Jl. Sisingamangaraja No. 26 Jakarta Selatan 12120 - Indonesia

Tel: +62 21 720 2605 - Fax: +62 21 720 2606 - www.moores-rowland.com
PT. Moores Rowland Indonesia
Scope of Assurance
We provided Type 2 assurance engagement under
AA1000AS (2008). This involved:
1) an assessment of Telkoms adherence to the
AA1000 AccountAbility Principles Standard
(2008) and
2) an assessment on the accuracy and quality of
specified sustainability performance information
contained within the Report, in relation to the
agreed scope. The scope of work consisted of:
Partnership program
Community stewardship program
Occupational health and safety
Human resources development.
The assured GRI G4 indicator related to the agreed
scope above is marked with the sign at the GRI G4
Core Index section of the Report.
Responsibility
Telkom is responsible for all information and claims
contained in the Report, including established
sustainability management targets, performance
management, data collection and report preparation,
etc. Our responsibility in performing this engagement
is to the management of Telkom only for the purposes
of verifying its statements relating to its sustainability
performance, more particularly as described in the
agreed scope. Our responsibility is to express our
conclusions in relation to the agreed scope.
Methodology
We have assessed several assertions and specified data
sets included in the report and the systems and
processes used to manage and report these using the
following methods:
Reviewed report, internal policies, documentation,
management and information systems
Carried out interviews with staff involved in
sustainability-related management and reporting
Followed data trails to initial aggregated source
and checked sample data to a greater depth during
the engagement process.
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
Limitations
Our scope of work was limited to a review of the
accuracy and reliability of specified data and interviews
with data providers, persons in charge of data
collection and processing, as well as persons in charge
of sustainability performance-related information.
Conclusions
We have confirmed that the Report has been prepared in
accordance with G4 Core Criteria issued by the Global
Reporting Initiative (GRI).
Findings and conclusions concerning adherence to the

AA1000 AccountAbility Principles of Inclusivity,
Materiality and Responsiveness include:
Inclusivity
An assessment has been made to determine whether
Telkom has included all key stakeholders in
developing and achieving an accountable and strategic
response to sustainability issues.
We found Telkom demonstrates a strong commitment
to stakeholder inclusivity. Telkom has an effective
system in place for key stakeholders to participate in
the development of the organization's response in the
context of sustainability. This is demonstrated for
instance, by conducting needs assessment surveys in
relation to the partnership and community stewardship
programme and materiality level survey to the key
stakeholders group.
However, we recommend that Telkom continues to
improve stakeholder inclusivity systems and
procedures on a regular basis to maintain their
effectiveness.
Materiality
An assessment has been made as to whether Telkom
has included in the Report the material information
required by its stakeholders in order to enable them to
make informed judgements, decisions and actions.
We found Telkom has a strong process in place to
determine material issues. Key material issues were
adequately reported and were found to provide
balanced information about Telkom's sustainability
performance. A range of internal stakeholders are
involved in Telkom's materiality determination
process. However, we recommend that Telkom
continues to conduct materiality test on a regular basis
in future reports.
Jl. Sisingamangaraja No. 26 Jakarta Selatan 12120 - Indonesia

Tel: +62 21 720 2605 - Fax: +62 21 720 2606 - www.moores-rowland.com
PT. Moores Rowland Indonesia
GRI G4
Core Index

113
Responsiveness
An assessment has been made as to whether Telkom
demonstrates that it responds to its stakeholders and is
accountable to them.
Telkom was found to be responsive to key stakeholder
concerns and expectations. This was achieved through
the organization's allocation of resources to stakeholder
engagement, the timeliness and accessibility of reported
information, and the types of communication
mechanisms regularly employed.
However, we recommend that Telkom continues to
improve stakeholder engagement procedures on a
regular basis in future reports.
Based on our limited assurance engagement, nothing

has come to our attention that causes us to believe that
the data of the Report has been materially misstated.
All key assurance findings are included herein, and
detailed observations and follow-up recommendations
have been submitted to Telkom management in a
separate report.
Jakarta, 12 September 2014
James Kallman
President Director
Moores Rowland is an international organization
specializing in audit, accounting, tax, legal and
advisory services. Moores Rowland is a member of
Praxity AISBL, the world's largest Alliance of
independent and unaffiliated audit and consultancy
companies.
We can rely on the skills of more than 33,400
professionals operating together in 97 countries,
sharing the same values and sense of responsibility,
whilst in Indonesia is served by Moores Rowland, one of
the leading sustainability assurance providers.
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Telkom Shares
GRI G4 Content Index

Indicator
Disclosures
Page
Assurance
GENERAL STANDARD DISCLOSURES

Strategy and Analysis
G4-1
Statement from the Board of Commissioner and Board of Director

ORGANIZATIONAL PROFILE
G4-3
Name of the organization
24
G4-4
Primary brands, products, and services
24
G4-5
location of the organizations headquarters
24
G4-6
Location of the organizations operates that are covered in the report
24
G4-7
Nature of ownership and legal form
29
G4-8
Markets served
24
G4-9
Scale of the organization
27
G4-10
Profle of the employees
82
G4-11
Collective bargaining agreements
78
G4-12
the organizations supply chain
27, 35
G4-13
Significant changes during the reporting period
28, 37
G4-14
Precautionary approach or principle addressed
28
G4-15
Externally developed economic, environmental and social charters,

principles, or other initiatives
29
List memberships of associations
29
30, 35
G4-16
Identified Material Aspects and Boundaries

G4-17
The entities included in the organizations consolidated financial statements

that are covered by the report
G4-18
Process for defining the report content and the Aspect Boundaries and
how the organization has implemented the Reporting Principles for
Defining Report Content
33
G4-19
List all the material Aspects identified in the process for defining report content
36
G4-20
Aspect Boundary within the organization
36
G4-21
Aspect Boundary outside the organization
36
G4-22
Effect of any restatements of information provided in previous reports, and

the reasons for such restatements
37
G4-23
Significant changes from previous reporting periods in the Scope and

Aspect Boundaries
37
Stakeholder Engagement
G4-24
List of stakeholder groups engaged by the organization
37
G4-25
Basis for identification and selection of stakeholders
37
G4-26
The organizations approach to stakeholder engagement
37
G4-27
Key topics and concerns that have been raised through stakeholder
engagement
37
Report Profile
G4-28
Reporting period
32
G4-29
Date of most recent previous report (if any).
32
G4-30
Reporting cycle
32
G4-31
Contact point for questions regarding the report or its contents
G4-32
The in accordance option chosen, GRI Content Index and cross reference
to External Assurance report
G4-33
The organizations policy and current practice with regard to seeking

external assurance for the report
32, 112
112
37
Governance
G4-34
Governance structure of the organization, including committees of the

highest governance body
88
Ethics and Integrity

G4-56
the organizations values, principles, standards and norms of behavior
91
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Indicator
Prioritizing
Customers
GRI G4
Core Index

Disclosures
Page
Assurance
SPECIFIC STANDARD DISCLOSURES

CATEGORY: ECONOMIC
Aspect: Economic Performance
G4-DMA
Disclosure Management Approach (DMA)
G4-EC1
Direct economic value generated and distributed
41
G4-EC2
Financial implications and other risks and opportunities due to

climate change
62
G4-EC3
Coverage of the organizations defined benefit plan obligations
41, 75
Aspect: Market Presence

G4-DMA
G4-EC5
Ratios of standard entry level wage compared to local minimum wage
74
Aspect: Indirect Economic Impacts

G4-DMA
G4-EC7
Development and impact of infrastructure investments and services

supported
40, 54
Indirect economic impacts
43, 44
G4-EC8
CATEGORY: ENVIRONMENTAL
Aspect: Energy
G4-DMA
G4-EN3
Energy consumption within the organization
63
G4-EN6
Reduction of energy consumption
63
G4-EN7
Reductions in energy requirements of products and services

Aspect: Emissions
G4-DMA
G4-EN15
Direct greenhouse gas (GHG) emissions (Scope 1)
63
G4-EN19
Reduction of greenhouse gas (GHG) emissions
63
CATEGORY: SOCIAL
SUB-CATEGORY: LABOR PRACTICES AND DECENT WORK
Aspect: Employment
G4-DMA
G4-LA1
New employee hires and employee turnover
G4-LA2
Benefits provided to full-time employees that are not provided to

temporary or part-time employees
82, 83
75
Aspect: Occupational Health and Safety

G4-LA6
Injury and rates, occupational diseases, lost days, and absenteeism, and
total number of workrelated
77
G4-LA8
Health and safety topics covered in formal agreements with trade unions
77
Aspect: Training and Education

G4-DMA
G4-LA9
Average hours of training per year per employee
72
G4-LA10
Programs for skills management and lifelong learning that support the
continued employability of employees and assist them in managing career
endings
75
73, 74
G4-LA11
Employees performance and career development reviews

Aspect: Diversity and Equal Opportunity
G4-DMA
G4-LA12
Composition of governance bodies and breakdown of employees

Aspects of Equal Remuneration
G4-DMA
G4-LA13
Ratio of basic salary and remuneration of women to men
74
115
116

2013 Sustainability
Performance
Overview
Indicator
About Telkom
About
This Report
Disclosures
Economic
Growth
Telkom Shares
Page
Assurance
Aspect: Supplier Assessment for Labor Practices

G4-DMA
G4-LA14
Percentage of new suppliers that were screened using labor practices

criteria
SUB-CATEGORY: HUMAN RIGHTS
Aspect: Freedom of Association and Collective Bargaining
G4-DMA
G4-HR4
Operations and suppliers identified in which the right to exercise freedom

of association and collective bargaining may be violated
78, 79
Aspect: Security Practices

G4-DMA
G4-HR7
Percentage of security personnel trained in the organizations human rights

policies
79
Aspect: Supplier Human Rights Assessment

G4-DMA
G4-HR10
Percentage of new suppliers that were screened using human rights criteria
SUB-CATEGORY: SOCIETY
Aspect: Local Communities
G4-DMA
G4-SO1
Percentage of operations with implemented local community engagement,

impact assessments
44, 51
Aspect: Anti-corruption
G4-DMA

identified
G4-SO4
Communication and training on anti-corruption policies and procedures
80
G4-SO5
Confirmed incidents of corruption and actions taken
80
Aspect: Public Policy

G4-DMA
G4-SO6
Total value of political contributions by country and recipient/beneficiary
G4-SO7
Anti-competitive behavior, anti-trust, and monopoly practices
103
SUB-CATEGORY: PRODUCT RESPONSIBILITY

Aspect: Product and Service Labeling
G4-DMA
G4-PR5
Results of surveys measuring customer satisfaction
104, 111
Aspect: Marketing Communications

G4-DMA
G4-PR7
Total number of incidents of non-compliance with regulations and

voluntary codes concerning marketing
107, 108
Aspect: Customer Privacy

G4-DMA
G4-PR8
Total number of substantiated complaints regarding breaches of customer

privacy and losses of customer data
107
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
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GRI G4
Core Index

117
Feedback Survey
Thank you for agreeing to read this 2013 Sustainability Report. To improve the quality of future Sustainability Reports, we
hope that you will agree to complete this Feedback Survey and return it to us.
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PT Telekomunikasi Indonesia, Tbk.
Investor Relations
Grha Merah Putih 5th Floor
Jl. Jend. Gatot Subroto Kav. 52
Jakarta 12710, Indonesia
T +62 21 521 5109
F +62 21 522 0500
email : investor@telkom.co.id
IDX : TLKM
NYSE : TLK
LSE : TKID
www.telkom.co.id
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2013 Sustainability
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Overview
About Telkom
About
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Glossary
Broadband
Telecommunication signal transfer
which includes broadband
frequency.
3G
General term for third generation
mobile telecommunication
technology. 3G offers high
connectivity for cellular phones
and other mobile communication
equipment thus making it possible
to have video conference and
other applications which needs
broadband connectivity to the
internet.
BTS
Base Transceiver Station is a
equipment which sends and
receives radio signals from and to
other telecommunication
systems.
3.5G
Different mobile phone and data
grouping technology with the aim
to achieve better performance
than the 3G system and is a step
towards 4G capacity.
BUMN
Badan Usaha Milik Negara means
State Owned Enterprise and is
a company owned by the State,
entity owned by the state, Public
Owned Company or Parastatal
which is a Legal Enitity formed by
the State to conduct commercial
activities on behalf of the State as
the owner.
ADS
American Depository Share (also
known as the American Depositary
Receipt or ADR), is a certificate
traded on the US securities markets
(such as the New York Stock
Exchange) representing a number
of foreign shares.
CDMA
Code Division Multiple Access is
a transmitting technology where
every transmission is being send
to a number of frequencies and a
certain code is given for each data
or voice transmission which ables
user to share the same frequency
spectrum.
ARPU
Average Revenue per User is a
measurement which is used by
Telecommunication and Network
Companies, to show how much
revenue it has made per average
user. This term can be translated as
total income divided by number of
customers or users using that
service.
CPE
Customer Premises Equipment
is a handset, receiver, settop box or other equipment
which is being used by wireless
telecommunication customers,
but is still based on broadband
technology and is owned by a
certain network operator and
placed in the customer premises.
Backbone
Main telecommunication network
which includes transmission and
switching facilities and connects a
number of network access nodes.
Transmission network between
node facilities and switching
includes microwaves, deep sea
cables, fiber optics and other
transmission technologies.
Downlink
Radio signal frequencies which is
transmitted by satellite to the earth
station.
Bandwidth
Communication capacity.
DTH
Direct-to-Home is the distribution
of television signals which
originates from Satellite to Earth
station with high power to small
antennas and satellite receivers
which is attached to homes in a
region of a country.
Economic
Growth
Telkom Shares
e-Commerce
Electronic commerce is the sales
and purchase of products through
electronic means such as internet
network or other computer
networks.
e-Money
Electronic money is money which
is transferred electronically
e-Payment
Also known as electronic funds
transfer, which is a exchange or
transfer of money electronically
from one account to another
account, either in the same
financial institution or in a number
of different financial institutions
through a computer based system.
Edutainment
Education and Entertainment
EVDO
Evolution Data Optimize is a
telephone service based on
wireless broadband 3G technology
for CDMA services.
Gateway
Gateway is a device which bridges
between Internet Protocol (IP)
and Public Switched Telephone
Network (PSTN ).
GPON
Gigabyte-Passive Optical Network
is a passive optic network which is
widely used to connect fibre optic
cables and signals to all end users.
GRI
Global Reporting Initiative
is an organization that sets
internationally accepted
sustainability reporting standards.
GRI-G4
A guideline for the compilation of
sustainability reports that came
into effect in 2014.
GSM
Global System for
MobileTelecommunication is a
European standard for cellular
digital telephones.
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Homepass
A connection with access to the
fixed telephone line network, IPTV
and broadband services.
HSPA+
Evolved High Speed Packet
Access is a Third Generation
Seri 7 Partnership Project
with a IP-centric architecture
which is more simpe for mobile
telecommunication and
has exceeded most old devices.
HSPA+ can achieve a high data
transfer connectivity to around 42
Mbit/secondfor downlink and 22
Mbit/secondfor uplink.
Intelligent Network
Independent telecommunication
network where logical functions
have been transferred from switch
and placed at computer nodes
which has been distributed through
that network. This enables the
device to develop and control
efficient service making new
telephone services much
faster to be launched.
Interkoneksi
Physical connection between a
carrier network with a number of
facilities or devices which are not
part of that network.
IP
Internet Protocol is a methode
or protocol where one data from
one computer is send to another
computer via internet.
IPTV
Internet Protocol Television is a
system thats allows television
services by using internet protocol
through a packet-switched network
such as the internet, and not
through public networks, satellite
signals and cable
television.
ISDN
Integrated Services Digital
Network, is a network which
Prioritizing
Customers
GRI G4
Core Index

119
provides digital end to end

connectivity and enables to send
voice, data and video at the same
time and providing high internet
connectivity.
Mbps
Megabyte per second, a measure of
speed for digital signal transmission
expressed in millions of bits per
second.
ISP
Internet Service Provider is a
organization which provides
internet access.
MHz
Megahertz, a unit of measure of
frequency equal to one million
cycles per second.
Kbps
Kilobyte per second, a measure of
speed for digital signal transmission
expressed in thousands of bits per
second.
Mobile Broadband
A marketing term for wireless
internet access through portable
modem, mobilephone, wireless USB
modem or other mobile devices.
KSO
Operation Cooperation is a form
of agreement that encompasses
the build, operate and transfer
previously used by Telkom, in which
the consortium partners invested
and operated Telkom facilities in
regional divisions.
Network Access Point

Public network exchange facility
where a number of ISP are
connected with one and another
through a peering setting.
LAN
Local Area Network is a network
with stations interconnected and is
able to share the network between
one and other and is usually in a
certain area (e.g in one building).
LTE
Long Term Evolution is a
technology standard for wireless
high speed connectivity for mobile
phones and data terminal.
Fixed Contribution Pension
A type of pension plan in which the
Company's annual contribution is
specified.
Fixed Benefit Pension
A type of pension plan in which,
from the beginning, the company
promises a certain monthly benefit
upon the employees' retirement.
The monthly benefit is determined
using a formula based on historical
income, years of service and
employee age, not based on return
on investment.
NGN
Next Generation Network is a
general term which is used to
determine a network based
package which provides services
including telecommunication
services and in which the service
function can act independently
from the transfer technology. NGN
is aimed to transfer a number of
services (voice, data and a number
of media such as video) with
a network which can combine
them into packages as if its being
operated by the internet. NGN is
generally build around the internet
protocol.
OJK
Otoritas Jasa Keuangan, is the
replacement of the Bapepam-LK,
which is a independent agency
with the task to conduct the
monitoring and regulating of
financial services in the Banking
sector, Capital Market sector and
non-bank financial industry.
PSTN
Public Switched Telephone
Network is a telephone network
which has been operated and
maintained by Telkom and KSO
Units for and on behalf of Telkom.
120

Pulsa
Pulsa is a telephone cost
calculation.
Roaming
Is a common term which is used to
indicate extension of connectivity
services in a location which is
different than the home location
where that service is registered.
RUPS
Rapat Umum Pemegang Saham,
which means Annual General
Shareholders Meeting (AGM)
or Extraordinary Annual General
Shareholders Meeting (EGM).
SLJJ
Distanced Direct Connection is a
form of distanced call for
customers who reside in a different
area but still in one
country. In general has each area
its own code.
SMS
The Short Messaging Service is a
form of technology that allows the
exchange of messages between
mobile telephones and fixed
wireless phones.
SOA
The Sarbanes-Oxley Act came
into effect on 30 July 2002 and is
also known as the Public Company
Accounting Reform and Investor
Protection Act, and Corporate
and Auditing Accountability and
2013 Sustainability
Performance
Overview
About Telkom
About
This Report
Stasiun Bumi
The antenna and associated
equipment used to receive or
transmit telecommunication signals
via satellite.
Switch
A electronic device, electric or
mechanical which functions to
open and close a circuit, stops
electric currents or choose a
channel or circuit and is used
to channel telecommunication
network traffic.
Fixed Wireline
A fixed wire or cable path linking
a subscriber at a fixed location to
a local exchange, usually with an
individual phone number.
Fixed Wireless
The local wireless transmission link
using a cellular, microwave, or radio
technology to connect customers
at a fixed location to the local
telephone exchange.
Fixed Line
Fixed wireline and fixed wireless.
TIMES
Telecommunication, Information,
Media and Edutainment.
Responsibility Act.
Satelit Transponder
Radio relay equipment embedded
in a satellite that receives signals
from earth and amplifies and
transmits the signal back to the
earth.
Soft Switch
A central device in a telephone
network that connects calls from
one phone line to another, entirely
by means of software running on
a computer system. This work was
formerly carried out by hardware,
with physical switchboards to route
the calls.
Pay TV
Pay Television, premium television,
or premium channels,
subscriptionbased television
services, usually provided by
both analog and digital cable
and satellite, but also increasingly
via digital terrestrial and internet
television.
Economic
Growth
Telkom Shares
SME
Small and Medium Enterprises
VoIP
Voice over Internet Protocol, a
means of sending voice information
using the IP.
VPN
Virtual Private Network is a secure
private connection which is build
in a infrastructure which is easy
to be accessed by public such
as internet or public telephone
lines. VPN combines a number of
encryptions, digital certificates and
user identification and controlled
access to secure traffic. This will
ensure connectivity to a number of
machines which are located behind
a gateway or firewall.
VSAT
Very Small ApertureTerminal is a
small antenna with a diameter of 1,5
to 3 meters, which can be placed at
the users location and can be used
for two way communication via
satellite.
Wi-Max
Worldwide Interoperability
for Microwave Access, a
telecommunications technology
that provides wireless transmission
of data using a variety of
transmission modes, from pointtopoint links to portable internet
access.
Wireless Broadband
Technology that provides high
speed wireless internet access or
computer networking access over a
wide area.
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

Telkom Sustainability
Report Journey
CARI
Laporan Keberlanjutan Sustainability Report 2009
Membangun
Masyarakat Informasi
PT TELEKOMUNIKASI INDONESIA, Tbk.
Building an Information Society
Connecting the Future
Bersama Anda
Menggenggam Dunia
PT Telekomunikasi Indonesia Tbk

PT Keberlanjutan
TELEKOMUNIKASI
Tbk Report
Laporan
2007INDONESIA
Sustainability
TELKOM Indonesia
Kantor Pusat/Head Office

GKP TELKOM
Jl. Japati No. 1, Bandung 40133
Tel : (62-22) 452 1108, 452 7252
Fax : (62-22) 720 3247
Mewujudkan Masyarakat
Informasi yang Unggul
Kantor Pusat/Headquarters
GKP TELKOM
Jl. Japati No. 1
Bandung 40133
Tel.
Fax.
2006
Laporan Keberlanjutan 2008

PT TELEKOMUNIKASI INDONESIA, Tbk
Sustainability Report 2008
the world in your hand
2007
Sustainability Report
Melaju untuk
Keberlanjutan
2009
Sustainability
Report
2012
Laporan
Keberlanjutan
2012
2012
2010
Senantiasa Mewujudkan
Masa Depan Anda
2008
Laporan Keberlanjutan
2009
www.telkom-indonesia.com
www.telkom-indonesia.com
2006
PT TELEKOMUNIKASI INDONESIA, Tbk.
Realizing an Excellent
Information Society
: (62-22) 452 7101

: (62-22) 424 0313
IDX
: TLKM
NYSE : TLK
LSE
: TKIA
Laporan Keberlanjutan
Holding the World with You
PT TELEKOMUNIKASI INDONESIA Tbk
IDX : TLKM
NYSE : TLK
LSE : TKIA
Telekomunikasi
Indonesia,
PTPT
Telekomunikasi
Indonesia,
TbkTbk
Telkom Preserves
the Environment
Telkoms
People
Telkom
Governance
Prioritizing
Customers
GRI G4
Core Index

Bringing the Sustainable
Digital Society
Sustaining Your Future
Bringing the Sustainable Digital Society
Global Talents and
Opportunities
T +62 21 521 5109

F +62 21 522 0500
email
: investor@telkom.co.id
IDX
: TLKM
Laporan
Keberlanjutan
2011
NYSE
: TLK
LSE
: TKIA
PT TELEKOMUNIKASI
INDONESIA, Tbk.
www.telkom.co.id
2010
2011
Sustainability Report 2012
Investor Relations
Grha Citra Caraka 5th Floor
2012
2013
This report is printed on recycled paper
121
122

2013 Sustainability
Performance
Overview
About Telkom

PT Telekomunikasi Indonesia, Tbk.

Investor Relations
Grha Merah Putih 5th Floor
T +62 21 521 5109
F +62 21 522 0500
email : investor@telkom.co.id
IDX
: TLKM
NYSE : TLK
LSE
: TKID
www.telkom.co.id
About
This Report
Economic
Growth
Telkom Shares

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Telkom Preserves

2013 Sustainability Report

2013 Sustainability Report

PT Telekomunikasi Indonesia, Tbk

2013 Sustainability Report

2013 Sustainability Report

Creating Sustainable Global

2013 Sustainability Report

2013 Sustainability Performance

Relationship with Suppliers

Operational Structure and

About This Report

Determining Materiality Level

Determining Material and

Materiality and Boundary

Relations with Stakeholders

Significant Changes from the

Telkom Preserves the Environment

Implications, Risks and

Fostering a Healthy and

Environmental Costs and

Occupational Health, Safety

IT-based HR Service System

2013 Sustainability Report

Code of Ethics and

Fulfilling Customer Needs

Marketing Strategy and

Improving Service Quality

Universal Service Obligations

GRI G4 Core Index

2013 Sustainability Report

Economic Value Generated

Economic Value Distributed

Retained Economic Value

Contribution to State Revenue

2013 Sustainability Report

Total Soft Loan

(including administrative costs)

2013 Sustainability Report

3,996 outdoor BTS and utilized

renewable energy sources for BTS in remote areas.

Use of capacitor banks to improve power factors.

Implementation of a paperless office for online office

7,966 reams per year.

Promotion of a healthy and environmentally friendly culture

Bike to Work and Earth Hour programs.

Recycling water for outdoor requirements and to water plants.

2013 Sustainability Report

Results and Program Realization

Reduced CO2 emissions of at least

961.39 tons carbon equivalent.

Creation of a Green Belt to minimize

15,000 mangrove seedlings

in Kampung Garapan, Tangerang.

Planting trees / regreening in Bandar

2013 Sustainability Report

Social Performance Highlights

Education and Training

Victims of Natural Disaster

2013 Sustainability Report

New Program: Poverty Alleviation with Funding of Rp6.63 billion

Assistance to Increase Public Religious Activities and Facilities