Zulkifli Zaini

Zulkifli Zaini
President Director

Bank Mandiri Tbk, PT

Zulkifli Zaini holds a BSc from the Bandung Institute Technology and an MBA in Finance from Washington University. In 2010, he was appointed as President Director of Bank Mandiri. Prior to that, in 2006, he was appointed as Director of Commercial Banking, responsible for Commercial Banking Business Segment, Wholesale Product Management and also supervised Bank Syariah Mandiri.
In 2003, he became Senior Vice President and Group Head, Retail Risk Management, and was appointed Managing Director and Senior Executive Vice President, Distribution Networks, with responsibility for Branches, Operations, Procurement and Assets Management.
In September 1999 until January 2003, he was appointed as Vice President and Division Head, Government Relationship Management. In 1998 he was promoted to Branch Manager of the Jambi Branch. Following the merger of Bank Mandiri, he served briefly as Senior Manager and Team Leader in Credit Risk Management.

 

Quotes

Zulkifli Zaini

Zulkifli Zaini

President Director, Bank Mandiri Tbk, PT

Volatility in forex markets could make it difficult to reach our growth targets.

Zulkifli Zaini

Zulkifli Zaini

President Director, Bank Mandiri Tbk, PT

Improved infrastructure will lower logistic costs and the cost of doing business in Indonesia.

 

Zulkifli Zaini

Zulkifli Zaini

President Director, Bank Mandiri Tbk, PT

When the European sovereign debt crisis began, we once again ran a stress test and organised a crisis management centre to monitor events and provide contingency planning.

Zulkifli Zaini

Zulkifli Zaini

President Director, Bank Mandiri Tbk, PT

We are trying to be very prudent by building a sufficiently strong liquidity buffer, monitoring market changes, analyzing the Bank’s portfolio on a day-to-day basis, and assigning senior managers with responsibility to track events.

Zulkifli Zaini

Zulkifli Zaini

President Director, Bank Mandiri Tbk, PT

We created a program that is aimed at developing best practices for developing young entrepreneurs. It’s called the Mandiri Young Enterpreneur Program and provides would-be entrepreneurs with training, coaching, mentoring, and access to the marketplace through the auspices of Bank Mandiri. […] we are planning a new program that is designed to create local self-sufficiency by promoting entrepreneurial principles across entire communities.

Zulkifli Zaini

Zulkifli Zaini

President Director, Bank Mandiri Tbk, PT

Among the issues we are likely to face in the future are impending skill shortages, an increasingly diverse workforce, leadership gaps, and an intensified “war for talent”.

Zulkifli Zaini

Zulkifli Zaini

President Director, Bank Mandiri Tbk, PT

Bank Mandiri has instituted a retention program that provides employees with tangible incentives, such as a stock ownership program; and intangible incentives such as coaching, mentoring and performance recognition.

Zulkifli Zaini

Zulkifli Zaini

President Director, Bank Mandiri Tbk, PT

Bank Mandiri provides the opportunity for outstanding young employees to take post-graduate degree courses in top universities around the world. This initiative is part of our talent management and succession planning program.

 

Read interview transcript

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What is the outlook for the global economy, as you see it?

The global economy will continue to face many challenges in the upcoming year. However, we’re confident about our own business prospects for 2012 because it’s supported by a resilient domestic economy. On the other hand, we are not totally immune from the global crisis and its second-order impact on Indonesia’s major trading partners such as China and India.

Looking ahead, what risks to your business concern you the most?

The uncertainty in global economic conditions is the main risk we face. Slower global growth could adversely affect export performance and increase currency volatility, which in turn would have a negative impact on Bank Mandiri. As a hedge against currency volatility we would likely lower our foreign exchange exposure. Nevertheless, volatility in forex markets could make it difficult to reach our growth targets. Similarly, volatility in the capital markets could discourage companies from listing their shares publicly, which, in turn, could reduce potential revenue associated with our capital market brokerage and advisory business.

What should the Indonesian government be doing to strengthen the domestic economy?

The government should support the domestic economy by pressing forward with its various infrastructure projects. Improved infrastructure will lower logistic costs and the cost of doing business in Indonesia, generally. Additionally, the Indonesian Central Bank should continue to watch closely for signs of currency volatility, which would harm domestic businesses. With regard to fiscal matters, the government has done a good job. Indonesia has a debt-to-GDP ratio of 26% - which is much lower than most of the European countries. More recently, the government has successfully managed to lower its foreign debt by switching to debt secured by domestic currency bonds. At this stage, we have confidence in the government’s fiscal management. Furthermore, the government also maintains people’s purchasing power by actively managing volatility in food prices. 

How is your approach to managing enterprise-level risk changing?

After the collapse of Lehman Brothers - which threatened market confidence and could have triggered capital flight out of the domestic economy - Bank Mandiri ran a comprehensive liquidity stress testing. Based on our stress testing results - and in the face of the continuing deterioration of the global economy - we decided to put the Bank on a liquidity alert, build a liquidity buffer, and establish a business and crisis management center. When the European sovereign debt crisis began, we once again ran a stress test and organised a crisis management centre to monitor events and provide contingency planning. We are trying to be very prudent by building a sufficiently strong liquidity buffer, monitoring market changes, analyzing the Bank’s portfolio on a day-to-day basis, and assigning senior managers with responsibility to track events. For the time being, we are maintaining our corporate portfolio in sectors - such as infrastructure and retail banking - which we view as optimal in terms of our own risk / reward profile. Our risk management capabilities have grown rapidly in the past three years as a result of the implementation of our Enterprise Risk Management framework. Our ERM framework enables us to operate in more risk-sensitive environments while at the same time utilizing our capital in a way that delivers optimal shareholder value.

Is the bank’s board becoming more engaged with enterprise risk?

Yes. We assess our enterprise risk using two different approaches: A bottom-up risk profile assessment; and a top-down enterprise risk assessment. Our annual enterprise risk assessment survey brings our executive management into the process and provides them with a platform to articulate their own concerns and appetite for risk in the coming year. This annual enterprise risk assessment, along with our whole ERM framework, has engendered a sense of risk-awareness throughout our business planning and execution. Our KPIs and performance evaluation now take into account risk measures such as capital allocation, RAROC, and economic profit.

To what extent have environmental or social concerns become an element of your business planning process?

As a public listed company - and also as a state-owned company - we are fully aware of and committed to Corporate Responsibility as one of our key business missions. We have demonstrated our strong commitment to CR principles through the implementation of a number of programs, one of the most notable being our entrepreneurship initiative. We understand that entrepreneurship plays a critical role in the economic sustainability of every country. Consequently, we created a program that is aimed at developing best practices for developing young entrepreneurs. It’s called the the Mandiri Young Enterpreneur Program and provides would-be entrepreneurs with training, coaching, mentoring, and access to the marketplace through the auspices of Bank Mandiri. Also, we are planning a new program that is designed to create local self-sufficiency by promoting entrepreneurial principles across entire communities. We also committed to a variety of environmental activities such as tree replanting, waste recycling, and energy-use reduction.

How does Bank Mandiri approach innovation?

In the end, innovation must be focused on meeting the expectations of customers. Accordingly, the Bank has developed a spectrum of programs to radically improve the quality of customer service. One program aims to upgrade the service quality provided by our “frontline” representatives - including our sales and service employees.  We are also encouraging an innovative culture within our organization since 2011, to encourage the spur of innovativeness culture we award employees that based on a rigorous process is considered as the most innovative in terms of  producing new products, services or process improvements.  We also put in place specific KPI to measure revenues generated from new products.

In what ways has talent become a strategic issue for you?

The ability to sustain a steady supply of critical talent is a challenge facing our organization. Among the issues we are likely to face in the future are impending skill shortages, an increasingly diverse workforce, leadership gaps, and an intensified “war for talent”.  As a consequence, Bank Mandiri has instituted a retention program that provides employees with tangible incentives, such as a stock ownership program; and intangible incentives such as coaching, mentoring and performance recognition. There is at Bank Mandiri a sustained executive commitment to talent management and the Bank’s board is also deeply involved in the issue through its Talent Management Committee. We also have detailed succession plans for senior leadership that have been developed through our own in-house leadership program and with the assistance of external consultants and executive education institutions.

What will the Bank’s leaders of the future look like?

Our future leaders will be outward looking, with focus on professionalism, customer needs, and will strive to make continued improvement for achieving excellence. Our leaders will be competent, competitive but yet will collaborate effectively across the units.

What challenges do Millennial generation employees present to your organisation?

Obviously the bank will need to be able to develop a strong value proposition to attract & retain our employees. We need to make a solid talent management process to retain our younger employees with more segmented approach rather than a one size fits all in retaining & developing the talents.

How are you collaborating with educational institutions or governments to better develop a pipeline of future employees?

Bank Mandiri provides the opportunity for outstanding young employees to take post-graduate degree courses in top universities around the world. This initiative is part of our talent management and succession planning program and is currently being applied at all levels and in all business units of Bank Mandiri. In addition, we support our employees’ participation in training programs in various domestic and international educational institutes. Furthermore, we are in the process of implementing a national internship and scholarship program for university students to help them gain work experience and financial support for their further education.