Report of the Board of Directors

Subakti Syukur

President Director

Esteemed Shareholders and Stakeholders,

We express our gratitude to the presence of the Almighty God for His abundant blessings upon all of us, allowing Jasa Marga to deliver good performance despite external challenges such as geopolitical tensions and relatively high-interest rates. Through this Annual Report, we would like to present the Company’s performance results for the year 2023 as a manifestation of our responsibility to shareholders and all other stakeholders.

Industry and Economic Conditions in 2023

Indonesia’s economic growth remains robust amid the global economic slowdown. According to data released by the Central Statistics Agency (BPS), the fourth-quarter 2023 economic growth reached 5.04% (YoY), showing an increase compared to the previous quarter’s growth of 4.94% (YoY). With this development, Indonesia’s overall economic growth for the full year 2023 is recorded at a strong 5.05% (YoY), lower than the achievement in 2022 which experienced growth was 5.31%. Furthermore, Bank Indonesia has decided to maintain the BI-Rate at the level of 6.00%, remaining consistent with the prostability monetary policy focus, aimed at strengthening the stabilization of the Rupiah exchange rate. This includes pre-emptive and forward-looking measures to ensure controlled inflation. Meanwhile, macroprudential policies and the payment system continue to be pro-growth to support sustainable economic growth. Loose macroprudential policies persist to stimulate banking credit/financing to businesses and households. The acceleration of payment system digitization is also being promoted to increase transaction volume and expand digital financial inclusion, including the digitization of financial transactions for the Central and Regional Governments.

The foundation of the Company as a pioneer of progress in the toll road industry in Indonesia today is carried out through enhancing competitiveness by implementing information technology and digital innovation, as well as empowering human capital with ethical and competent traits, thus becoming the catalyst for the Company to sustain continuous growth.

Strategy and Strategic Policies

As part of its duties and responsibilities, the Board of Directors plays an important role in formulating the Company’s strategies and strategic policies. The Board of Directors formulated the Company’s strategies and strategic policies to align with the aspiration of the Shareholders and the management, as well as the Company’s long-term strategies. The Company accelerates its transformation to support the Company in meeting its performance targets and maintaining its business sustainability in the future. There are six strategic programs, which serve as the transformation guideline, as set forth in the RJPP, namely (i) fundamental improvement, (ii) core business expansion, (iii) related business expansion, (iv) financing and asset recycling, (v) organization, human capital, and capabilities, and (vi) technology.

Throughout 2023, the following programs were implemented to accelerate Jasa Marga Group’s performance:

  1. With regard to ffundamental improvements, traffic projections, budgets, and project and financial controls were actively refined in the data-driven Toll Road Concession Subsidiaries, formalisation of unit cost standardisation and shared services in the areas of general and operations and preservation, development of shared services in IT, Legal, Human Capital, and Procurement for Jasa Marga Group.
  2. With regrard to core business expansion, the integration of toll road operations, planning of the entire business portfolio is still in the process of transforming PT JMTO’s business model from labour and project-based to technology and program-based operations and contracts, still in the process of transforming PT JMTM’s business model from labour and project-based to technology and contract-based based on operating performance.
  3. With regard to related-business, the Company transformed PT JMRB’s business model and restructured its organization.
  4. With regard to financing and asset recycling, the Company determined a portfolio management framework to improve financial sustainability while prioritizing the Company’s growth through measures which include asset recycling.
  5. With regard to organization, human capital, and capabilities, optimizing the strategic role of Jasa Marga business groups by enhancing business process and interaction model, human capital structuring in PT JMTO due to disruptive technology, internalization of core values and development and determination of data analytics capability.
  6. With regard to technology, development of business planning and consolidated platform, development of an integrated IT master plan and defining role distribution for IT/Technology function, financial transactions digitalization, use of Electronic Toll Collection (ETC) technology, prioritizing digital technology-based maintenance for road pavements, Motorway Incident Detection & Automatic Signaling (MIDAS) for traffic services, implementation of Traffic Counting to support traffic engineering, development of Jasamarga Integrated Maintenance Management System (JIMMS) application, and development of JM-Click as an integrated technology, as well as implementation of internal process automation.

The Role of the Board of Directors in Strategic Formulation and Strategic Policy

The Board of Directors is actively involved in formulating strategies and policies whilst making adjustments to market dynamics and the applicable regulations. The Board of Directors discusses the direction and strategic policies for each business unit, determines business targets, growth plan, and main facilities procurement such as technology, infrastructure, human capital, and risk management.

The Board of Directors makes sure that organizational framework runs effectively, policies and procedures are well-targeted, and risk management infrastructure is prudent to support daily operation in Jasa Marga and Subsidiaries.

The Board of Directors’ Process in Ensuring Strategy Implementation

Jasa Marga ensures strategy implementation by aligning it with the Company’s Long-Term Plan (RJPP) and the Company’s Work Plan and Budget (RKAP). In addition, effective communication from the Board of Directors to all business lines, supporting units, and all subsidiaries becomes a routine agenda in performance evaluation meetings. The Board of Directors actively monitors strategy implementation by performing regular reviews, providing feedback, and making decisions which are in line with market dynamics and the applicable regulations. Several main indicators are discussed in meetings with the Board of Directors, namely financial performance achievements, business development, operational issues, business risks, digital transformation, and employees’ performance.

Comparison between Achieved Results and Targets

The Company’s performance in 2023 exceeded the prescribed target with improving sustainable business management, strengthened economy, and increased activities and mobility among the community. The Company’s Main Performance in 2023 was assessed through 5 (five) perspectives, namely (i) Economic and Social Value to Indonesia (ii) Business Model Innovation, (iii) Technology Leadership, (iv) Increase in Investment, and (v) Talent Development. The total value of corporate KPIs in 2023 reached 104.33% or above the plan of 4.33%.

Analysis of the Company’s Performance

The aggregate traffic transaction volume realized in 2023 was 1,291.6 million transactions. This is 1.30% higher, or 16.54 million transactions, than its target of 1,275.03 million transactions. One of the reasons was Decree of the President of the Republic of Indonesia No. 17 of 2023 on Declaration of the End of the Corona Virus Disease 2019 (COVID-19) Pandemic Status in Indonesia on June 22, 2023, which resulted in people’s movement going back to normal and the economy starting to recover.

The Company managed to obtain new toll road concessions, namely toll road section Akses Patimban, with 37.05 km length on January 24, 2023. However, there was a reduction in the length of the company’s toll road concessions. In February 2023, the concession for the Gedebage - Tasikmalaya - Cilacap toll road section, spanning 206.65 km, was returned to the government. As a result, as of December 31, 2023, the company holds toll road concessions totaling 1,736 km for the year 2023.

The company was able to record a net profit of Rp6,749.5 billion from toll and other business revenues amounting to Rp15.6 trillion, consisting of toll revenue of Rp13.9 trillion and other business revenue of Rp1.6 trillion. In line with effective control over operating expenses, especially those related to supporting administrative activities affecting general and administrative expenses, the EBITDA performance reached Rp9.9 trillion, exceeding the planned target by 1.9%. On the other hand, interest expenses were realized 11.8% below the plan or equivalent to Rp480.7 billion due to the stability of the BI Rate and the lower-than-targeted funding needs for the construction of new toll roads. This is in line with the non-realization of construction progress according to the Company’s capital expenditure plan until the year 2023, with an absorption of Rp12.1 trillion, which is 32.7% lower than the planned Rp18.0 trillion. The low absorption of capex at the parent company is due to the non-realization of capital injections for the Toll Road Construction Subsidiary.

Challenges and Impediments Faced and Steps Taken to Resolve Them

Approaching 2023, global economy was threatened by various risks, such as geopolitical tensions, fluctuating global economy, and increasing trend of the interest rate. Throughout 2023, the Company faced various challenges and obstacles, both external and internal, in realizing the Revised 2023 RKAP, including:

  1. Toll Road Concession Business Line
    1. Timely Toll Road Tariffs Adjustment
      The Company faced another challenge in toll road concession business, namely timely toll road tariffs adjustment. Therefore, the Company ensured fulfillment of Minimum Standard of Services (SPM) in Toll Road operation, performed regular inspection and repair to meet SPM requirements, and monitored Service Level Agreement (SLA) fulfillment by toll road preservation and operations service providers.
    2. Operation of a new Toll Section
      Cinere-Serpong Section 2 toll operation is subject to the completion of Cinere-Jagorawi toll road, which concession is owned by PT Trans Lingkar Kita Jaya (TLKJ). Therefore, the Company kept coordinating with various stakeholders to connect both sections, so as to better ensure smooth mobility of people, goods, and logistics in Jabodetabek.
  2. Operational Business Line
    1. The Government’s Policy on the Implementation of Touchless Technology drove toll road operation towards touchless technology since the enactment of Regulation of the Ministry of Public Works and Housing (Permen PUPR) No. 16 of 2017 on Cashless Transaction on Toll Roads using touchless-based technology as has been amended most recently by Regulation of the Ministry of Public Works and Housing (Permen PUPR) No. 18 of 2020 on Touchless Cashless Toll Transaction on Toll Roads. Certainty on the use of Multilane Free Flow (MLFF) technology posed another challenge to the Company because at the same time, the Company was developing Electronic Toll Collection (ETe) and Intelligent Transport System technology which can be used to support toll road operation for improved effectiveness and efficiency. The Company has also prepared capability development and program plans for its human capital in operation to meet both the Company’s and the employees’ interests.
    2. Operational Costs
      Fluctuating price of the Fuel Oil (BBM) resulted in rising inflation and increasing toll road operational costs. The rising inflation also meant increased Regional Minimum Wage (UMR) and human capital costs for road operation and maintenance. The Company endeavored to maintain effective and efficient toll road operation with economies of scale whilst prioritizing SPM fulfillment.
  3. Prospective Business Line
    In general, the main focus of the prospective business of Jasa Marga’s subsidiary, PT JMRB, is optimization of the Company’s asset. PT JMRB is currently focusing on 5 business lines, namely:
    1. Property/Toll Corridor Development (TCD)
    2. Rest and Service Areas.
    3. Advertising and Utility.
    4. Building Management.
    5. Commercial.
  4. Finance
    In terms of finances, the most significant challenge faced by the company is related to the funding of toll road projects and the upward trend in interest rates. Global economic uncertainty will impact the increase in construction costs and the company’s interest expenses. Meanwhile, the company is obliged to maintain covenants, including a minimum Interest Coverage Ratio (ICR) of 1.1x and a maximum Debt to Equity Ratio (DER) of 5x. To address these challenges, the company strives to implement financial innovations and portfolio restructuring. In 2023, the company’s main focus to maintain these covenants includes the Equity Financing program for PT JTT, continuing the investment credit refinancing program in subsidiaries, efforts to enhance EBITDA performance growth, and ongoing efficiency measures to manage expenses while ensuring compliance with Minimum Standard Services.
  5. Human Capital and General Affairs
    The speed of the Company’s business growth must be supported by its capability in providing the right human capital equipped with capabilities that match current and future needs of the organization. The Company carried out human capital capability improvement through digital-based training, development, coaching, and mentoring program. The Company also performed an organizational rejuvenation to improve speed of adaptation and organizational rejuvenation in the midst of ever increasing business competition. Employee engagement is improved by implementing Respectful Workplace Policy (RWP), running “Roadster Assertiveness Counseling Program (Rosela)”, and providing “Travoy Kids” Daycare facility and the provision of other work support facilities for employees serve as means for the company to enhance employee engagement.

Increasing Competitiveness

Jasa Marga’s commitment to continue as a leading company in toll road industry in Indonesia is demonstrated through the Company’s enthusiasm in increasing its competitiveness. A number of initiatives are made to increase its competitiveness by way of maintaining consistency in performance achievements and making improvements in its business process, both core and supporting business lines. Jasa Marga believes that active development of technology capabilities and being adaptive to digital information advancement are main keys to keep the Company as market leader. The Company also believes that sustainable technology innovations that the Company has been making must be supported by improved competency and capability of the human capital to meet business needs and dynamics. This way, harmony in the Company is fostered and its competitiveness will continue to improve in the long term.

Business Prospects

High economic growth is being driven by increased domestic demand. Household consumption grew by 4.47% (YoY) due to increased mobility, especially during National Religious Holidays (HBKN) such as Christmas and New Year, stable public purchasing power, and rising consumer confidence. Meanwhile, Government Consumption increased by 2.81% (YoY), driven by spending on goods and personnel. Overall investment growth increased to 5.02% (YoY), mainly due to building investment as infrastructure development continued and activity increased. Investment in the building sector also showed positive growth, in line with continued infrastructure development in various regions. Nevertheless, overall exports experienced growth of 1.64% (YoY), driven by demand from major trading partners which continued to grow positively despite the decline in prices of leading export commodities, as well as improving service exports in line with the increase in the number of foreign tourists.

The Ministry of Public Works and Housing (PUPR) together with the Toll Road Business Entity (BUJT) continued toll road construction completion to improve multimode connectivity for a more efficient national logistic system service to support economic growth and increase competitiveness. Since 1978 until now, the operational toll roads in Indonesia have reached a length of 2,816 km, distributed across Java, Sumatra, Kalimantan, Sulawesi, and Bali.

These improving external factors and the Government’s support are expected to give the Company opportunities and positive prospects for its business development in the future.

Implementation of Good Corporate Governance

Jasa Marga believes that consistent implementation of GCG will strengthen the Company’s position in facing business competition, improving effectiveness and efficiency in human capital management, maximizing long-term value, and increasing stakeholders’ trust. To this end, GCG must be implemented in such a way so as to support the Company’s business process.

Jasa Marga continues to improve GCG implementation quality and scope gradually and sustainably. On Febaruary 16, 2023, Jasa Marga held a panel discussion, inviting an Anti-Corruption practitioner who previously served as Vice Chairman at KPK during 2011-2015. This JM Talk was attended by the President Director, the Board of Directors, Commissioners (Mr. M. Roskanedi and Mr. Marsetio), the President Director of Subsidiaries and Commander of AKHLAK BOD-2 and BOD-3. In addition, Jasa Marga also held an Anti-Bribery Management System (SMAP) Awareness Training which aims to provide understanding of SMAP and measure the level of understanding of the materials presented. These materials include the concept of anti-bribery and the requirements of ISO 37001:2016, concept development in ISO 37001:2016 implementation, and understanding of corruption, gratification, and bribery. A total of 31 participants attended this training. 81% of them were able to answer correctly with a passing grade of 70 and above.

Each year, the Company conducts a GCG assessment to measure the implementation of GCG and make improvements according to the recommendations in the assessment results. In 2023, the GCG assessment parameters as a standard for GCG implementation in the Company in accordance with the Decree of the Secretary of the Ministry of State-Owned Enterprises No. SK-16/S. MBU/2012 dated June 6, 2012 concerning Indicators/ Parameters for Assessment and Evaluation of the Implementation of Good Corporate Governance in SOEs were officially revoked and replaced by the Regulation of the Minister of SOEs No. PER-2/MBU/03/2023 concerning Guidelines for Governance and Significant Corporate Activities of State-Owned Enterprises but there are no replacement parameters related to GCG implementation. Therefore, the implementation of the Company’s GCG assessment in 2023 only uses criteria and methodology that refers to the Guidelines for Public Company Governance as stipulated in the Financial Services Authority (OJK) Regulation No. 21/POJK.04/2015 dated November 16, 2015 concerning the Implementation of Public Company Governance Guidelines elaborated in the Circular Letter of the Financial Services Authority No. 32/SEOJK.04 /2015 dated November 17, 2015 on the Guidelines for Public Company Governance which is conducted by self-assessment, as well as GCG assessment based on the Asean Corporate Governance Scorecard (ACGS) conducted by the Indonesian Institute for Corporate Directorship (IICD). Based on the ACGS, the Company achieved a weighted score per principle of 93.10.

Assessment of the Performance of Committees under the Board of Directors and Basis of Assessment

In carrying out its role, the Board of Directors is supported by the Risk Management Committee and the Information Technology Steering Committee. Throughout 2023, the Risk Management Committee and the Information Technology Steering Committee have performed their duties well. The Board of Directors regularly assessed these committees’ performance against the prescribed guidelines and procedures and have gained valuable insights to support strategic decision making. The committees working under the Board of Directors held regular meetings to ensure harmony between the work program and current economic condition, business development, and the applicable regulations.

Changes in the Composition of the Board of Directors

In 2023, a change was made to the composition of the Company’s Board of Directors. The change to the composition of the Board of Directors was made by virtue of Extraordinary General Meeting of Shareholders (GMS) on February 8, 2023 to improve the role, function, and duty implementation of the Company’s Board of Directors. The Shareholders unanimously approved the resignation of Mr. Ade Wahyu as Director of Finance and Risk Management and appointed Ms. Pramitha Wulanjani as Director of Finance and Risk Management. On behalf of the Company, the Board of Directors expresses its gratitude to Mr. Ade Wahyu for his contribution and dedication during his term as member of the Company’s Board of Directors. Thus, the composition of the Company’s Board of Directors as of the preparation of this report is as follows:

Position Name
President Director Subakti Syukur
Director of Business Reza Febriano
Director of Human Capital and Transformation Bagus Cahya Arinta B.
Director of Operations Fitri Wiyanti
Director of Business Development Mohamad Agus Setiawan
Director of Finance and Risk Management Pramitha Wulanjani


Concluding this report, we extend our deep appreciation to the entire Board of Commissioners who have entrusted the Directors with full confidence to carry out their duties. We also express our gratitude to all customers, business partners, shareholders, employees, and regulators for their trust, contributions, cooperation, and support. We hope that our partnership will become even stronger in facing challenges in the coming years. We believe that with capability, hard work, and strong determination, Jasa Marga will be able to optimize every opportunity and provide the best service to all customers while actively contributing to national economic development. Moving forward, we remain committed to always delivering the best for sustained performance improvement. The Board of Directors hopes that Jasa Marga will continue to be an essential part and contribute to enhancing economic growth in Indonesia.

Jakarta, April 16, 2024

On Behalf of the Board of Directors

Subakti Syukur

President Director