Credit Risk Management as Part of the Management Control System

Abstract

This study aims to analyze credit risk management as part of the management control system at PT Pegadaian (Persero) based on annual reports for the 2020–2024 period. This study uses a descriptive qualitative approach with secondary data obtained through documentation of the company's annual reports. Data were analyzed using the Miles, Huberman, and Saldaña model, consisting of data reduction, data display, and conclusion drawing. The results indicate that credit risk management at PT Pegadaian (Persero) has been integrated into the management control system through the processes of risk identification, measurement, monitoring, and control. This implementation is supported by risk management policies, risk governance structures, the Three Lines Model, Risk and Control Self Assessment (RCSA), Risk Appetite, Risk Profile, Risk Culture, and the Pegadaian Risk Management Application (PRISMA). During 2020–2024, the implementation of credit risk management developed through the strengthening of risk governance, improvement of risk maturity, development of Enterprise Risk Management (ERM), enhancement of risk culture, utilization of information technology, and strengthening of
monitoring and evaluation. This study is limited to information disclosed in the company's annual reports and
does not involve interviews or direct observations. The findings imply that strengthening risk governance, risk culture, information systems, and monitoring supports the effectiveness of the management control system. This study provides a five-year analysis of the development of credit risk management as an integral part of the management control system at the corporate level of PT Pegadaian (Persero). Unlike studies focusing on specific credit activities or individual branches, this study examines the  development of credit risk management based on the company's annual reports over the 2020–2024 period.