With the Financial Services Authority (OJK) regulation number 51/POJK.03/2017, sustainability reporting has become a mandatory requirement for Financial Services Companies, Issuers, and Public Companies since 2021. This regulation has marked a significant step towards integrating sustainability into the financial sector and corporate practices in Indonesia.

Enforcement of this regulation will become more stringent in the coming years, especially after the launch of the ‘Indonesia Banking Road to Net Zero Emission’ and the Climate Risk and Sustainability Transition (CRST) in early March 2024. These initiatives underline Indonesia's commitment to mitigate climate change and promote sustainable practices in the banking sector.

The initial phase of CRST will be implemented for the 18 largest banks, with a deadline of July 2024 for 50% of their portfolio and 2025 for 100% of the full portfolio. This progressive approach ensures that these large banks lead the way in sustainability reporting and set an example for the rest of the sector.

Kadin Indonesia in collaboration with S&P Global has held a Sustainability Business Forum titled ‘Navigating Climate Risk and Regulatory Compliance in Indonesia’ on 25 June 2024. The aim of the event was to provide a platform for companies and banks in Indonesia to understand and navigate the evolving sustainability risk landscape.

The event was held to encourage discussion on topics that are important to Indonesian companies and banks, such as translating climate scenarios into financial performance, assessing physical risk hazards, understanding S&P Global Corporate Ratings, and the relevance of natural risks. The ultimate goal is to promote more sustainable Indonesian corporations and banks and empower Indonesian companies and banks to thrive in this changing environment.