JOURNAL OF CRITICAL REVIEWS ISSN- 2394-5125 VOL 7, ISSUE 15, 2020 1401 BUSINESS ETHICS AND LEGAL LIABILITY IN THE MANAGEMENT OF STATE-OWNED ENTERPRISES Eddhie Praptono 1 , Erwin Aditya Pratama 2 , Achmad Irwan Hamzani 3 , Hamidah Abdurrachman 4 , Sanusi 5 , Nur Rohim Yunus 6 1,2,3,4,5 Universitas Pancasakti Tegal-Indonesia 6 Universitas Islam Negeri Syarif Hidayatullah Jakarta Received: 16 March 2020 Revised and Accepted: 17 June 2020 ABSTRACT: State-owned enterprises are the embodiment of the purpose of the country's implementation namely the welfare of the nation's life as mandated the opening of the Constitution article 33, the state-owned enterprises are a company whose shares consist 51% of the country's ownership and has business governance by involving its management from state institutions i.e. the Ministry of State-owned enterprises. The purpose of this research is to know how business ethics must be held in the management of state-owned enterprises as well as of business ethics so that the objectives of the Constitution can be achieved. This method of research methods uses the focus of the Judicial Case Study. Research type of Library Research. The research approach uses a normative approach. The data source used is secondary data. Data collection methods are pursued through a library study, a qualitative descriptive data analysis method. Business ethics in the management of state-owned enterprises is through the principle of good corporate governance with the spirit of conducting transparent corporate governance and accountability. Implementation of business ethics through good corporate governance can be done by the government through the Ministry of State BUMN has taken strategic steps since the year 2002 began with the decree issued Ministry of State BUMN Number 117 Year 2002, which requires companies to apply Good Corporate Governance principles and practices. KEYWORD: State-Owned Enterprise, Business Ethic, Law Liability I. INTRODUCTION State-owned enterprises (BUMN) is one of the economic drivers in Indonesia, which is expected to boost people's welfare improvement efforts. BUMN, as a corporation, plays a central role in the economic system in Indonesia. The constitutional foundation is the basis of the existence of BUMN Constitution 1945 article 33 that places BUMN as one of the actors State economy in addition to private and cooperative. In his role, BUMN not only Performs production functions but performs the functions of the Distribution of goods and services. BUMN also has an important role because it is involved in the Resource allocation process which is economical for the community. Nevertheless, it seems that BUMN contributions to increasing growth [1]. The country's economy and welfare are not fully realized. The performance of BUMN is expected to boost the economy, until now Still assessed has not achieved the expected results. In contrast, in a few years last, the state is assessed as a burden for the country and society. Management the less professional BUMN caused the government to be one of the shareholders more stocks suffer losses than on obtaining profits. Statistics of 158 Enterprises which have assets of IDR 1163.64 trillion, profit Obtained before tax in the year 2004 only IDR 49.82 trillion. Meanwhile, the Contribution through a variety of taxes to be paid to reach IDR 25 trillion per in 2003. This condition is exacerbated by corrupt practices, which, based on research conducted by the Center for Research and Development of surveillance systems BPKP, one of the most common institutions of corruption practices in it Is BUMN [2]. The government on the other hand is the state administrative machinery utilizing governance to ensure effective service delivery, see corporate governance as a model of rules governing mechanisms of the decision- making process, and the mechanisms of control and liability of the state entities or private companies. The rules relate to principles such as disclosure, openness, and information, transparency, legitimization, participation, and checks and balances [3]. Public expectations about the business of state-owned enterprises have increased. These trends are sometimes straight forward related to the Corporate Social Responsibility (CSR) benefits of state-owned enterprises or with other ideas such as sustainability, triple bottom line, sustainable development, corporate citizenship, or human rights. It should be noted that various concepts involve several different debates, together with tradition, focus, and frame; sometimes certain attention the topic can be traced back to a particular literary