SBFN Member Since:
2013
Member Organisations
Otoritas Jasa Keuangan (Indonesia Financial Services Authority)
Progress Against sub Pillars
Framework Documents
| Country | Policies/ Principles/ Guidelines | Year | Issuer |
|---|---|---|---|
| Indonesia | 2022 | Indonesia Financial Services Authority (OJK) | |
| Indonesia | 2021 | Indonesia Financial Services Authority (OJK) | |
| Indonesia | 2021 | Indonesia Financial Services Authority (OJK) | |
| Indonesia | 2021 | Indonesia Financial Services Authority (OJK) | |
| Indonesia | 2020 | Government of Indonesia | |
| Indonesia | 2017 | Indonesia Financial Services Authority (OJK) | |
| Indonesia | Regulation on the Issuance and the Terms of Green Bond (No. 60/POJK.04/2017) | 2017 | Indonesia Financial Services Authority (OJK) |
| Indonesia | Regulation on application of Sustainable Finance to FSI, Issuer and PLC | 2017 | Indonesia Financial Services Authority (OJK) |
| Indonesia | 2017 | Indonesia Financial Services Authority (OJK) | |
| Indonesia | 2014 | Indonesia Financial Services Authority (OJK) |
Pillar 1 - ESG Integration - Strategic Alignment
National Framework
P 1.1 – Has the regulator or industry association published a national framework (“Framework”) for the banking sector that sets out expectations for integrating the consideration of environmental, social, and governance (ESG) risks and performance?
Yes
Source Reference Detail
OJK launched the Indonesian Banking Development Roadmap (RP2I) 2020 – 2025 as a reference for authorities, the banking industry and other stakeholders in responding to various dynamics due to the Covid-19 pandemic and the changing conditions that accompany it.
Source Reference Document
Indonesian Banking Development Roadmap (RP21) 2020 – 2025
Source Reference Description
–
P 1.2 – Has the relevant regulator or industry association published a Framework for capital markets, investment, insurance or other non-lending FIs that sets out expectations for integrating the consideration of environmental, social, and governance (ESG) risks and performance?
Yes
Source Reference Detail
OJK issued the Indonesian Financial Services Sector Master Plan (MPSJKI) 2021-2025; the theme “Restoring the National Economy and Increasing Resilience and Competitiveness of the Financial Services Sector” as a basic framework for the strategic direction of the Financial Services Sector.
Source Reference Document
Indonesian Financial Services Sector Master Plan (MPSJKI) 2021 – 2025
Source Reference Description
–
Pillar 1 - ESG Integration - Strategic Alignment
Alignment with International Goals & Standards
P 1.3 – Does the Framework make reference to international sustainable development frameworks or goals?
Yes
Source Reference Detail
–
Source Reference Document
Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation (POJK No 51 on 2017); year 2018, page 8 – III.3
Source Reference Description
Page 8 – 11.3
P 1.4 – Does the Framework make reference to established international ESG risk management standards and principles for FIs??
Yes
Source Reference Detail
OJK launched the Indonesian Banking Development Roadmap (RP2I) 2020 – 2025 as a reference for authorities, the banking industry and other stakeholders in responding to various dynamics due to the Covid-19 pandemic and the changing conditions that accompany it.
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017) OJK Regulation about Issuing Green Bond (POJK No 60 on 2017)
Source Reference Description
Page 3
Pillar 1 - ESG Integration - Strategic Alignment
Alignment with national goals & strategies
P 1.5 – Does the Framework make reference to specific national development objectives, plans, policies, goals, or targets?
Yes
Source Reference Detail
1. Medium – Long term Development Plan (RPJMN) 2020-2024 2. Presidential Decree (Perpres No.59/2017 and Appendix on Sustainable Development Goals) 3. UU No.16/2016 on Indonesia’s Climate Change Commitments under the Paris Agreement – NDC 4. UU Cipta Kerja (No.11/2020) dan Peraturan Turunannya: PP No.5/2021 tentang Perizinan Usaha Berbasis Resiko Omnibus Law (No.11/2020) and its Derivative Regulation: Presidential Decree No.5/2021 on Risk-Based Business Licensing
Source Reference Document
–
Source Reference Description
–
P 1.6 – Does any cooperation exist between agencies or between the regulator and industry association with respect to policy design and/or implementation related to ESG integration?
Yes
Source Reference Detail
Indonesia established pilot project The First Movers on sustainable banking (2015) and the initiative is continued by the industry –> Indonesian Sustainable Finance Initiative (IKBI) (2017). The membership is growing and includes largest banks implementing sustainable finance principles. OJK also works with various ministries and with financial industry associations to promote sustainable finance.
Source Reference Document
(1) Sustainable Finance Regulation (POJK No 51 on 2017) (2) OJK Regulation about Issuing Green Bond (POJK No 60 on 2017)
Source Reference Description
(2) Page 18, 24, 25
P 1.7 – Does any inter-agency data sharing currently exist related to ESG integration by FIs?
No
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
Pillar 1 - ESG Integration - Regulatory and Industry Association Actions
Overall Approach & Strategy
P 1.8 – Does the Framework provide guidance on the role of the regulator or industry association with regard to assessing and managing ESG risk and performance in the financial sector?
Yes
Source Reference Detail
Sustainable Finance Regulation (POJK No 51 on 2017); Article 7 – requires Financial Institutions to integrate E&S risks into its risk managemnet
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
Article 7
P 1.9 – Has the regulator or industry association undertaken market assessment to identify systemic ESG risks through analysis of the portfolios of supervised entities/members and published the results?
No
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
Pillar 1 - ESG Integration - Regulatory and Industry Association Actions
Technical Guidance
P 1.10 – Does the Framework provide technical guidance or tools to support implementation of ESG risk and performance management by the financial sector?
Yes
Source Reference Detail
–
Source Reference Document
Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
–
Pillar 1 - ESG Integration - Regulatory and Industry Association Actions
Supervisory Activities & incentives
P 1.11 – Is the implementation of the Framework regularly monitored and/or information regularly collected from FIs by the regulator and/or industry association?
Yes
Source Reference Detail
–
Source Reference Document
Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation (OJK, 2018), p68
Source Reference Description
Page 68
P 1.12 – Does the regulator or industry association provide any financial or non-financial incentives for FIs to manage ESG performance as part of the Framework?
No
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
P 1.13 – Does the regulator or industry association apply any disincentives/penalties for non-compliance by FIs in terms of expectations from the regulator and/or industry association related to ESG risk management as part of the Framework?
Yes
Source Reference Detail
Sustainable Finance Regulation (POJK No 51 on 2017), Article 13 (1&2) on administrative sanctions
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
Article 13 (1 and 2)
Pillar 1 - ESG Integration - Regulatory and Industry Association Actions
Tracking & Aggregated Disclosure
P 1.14 – Has the regulator or industry association established a data collection approach and database to track or regularly publish data related to ESG integration by FIs as part of the Framework?
Yes
Source Reference Detail
–
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
–
Pillar 1 - ESG Integration - Expectations of FI Actions
Strategy & Governance
P 1.15 – Does the Framework require/ask the FI’s board of directors (or highest governing body) to approve an ESRM and/or ESG integration strategy, and to supervise its implementation?
Yes
Source Reference Detail
–
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
Page 7 – Article 4 (4) & page 21 – II – A -4. a & b
Pillar 1 - ESG Integration - Expectations of FI Actions
Organizational Structure & Capacity Building
P 1.16 – Does the Framework require/ask FIs to allocate resources/budget commensurate with portfolio ESG risks and define roles and responsibilities for ESG integration within the organization?
Yes
Source Reference Detail
–
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
page 22 – II. A. 5. a. b.
P 1.17 – Does the Framework require/ask FIs to develop and maintain the ESG expertise and capacity of staff commensurate with portfolio ESG risks through regular training and learning?
Yes
Source Reference Detail
Workshop/training to enhance Financial Institutions competencies to increase financing/investment activities in the sustainable finance priority economic sector
Source Reference Document
OJK Regulation about Issuing Green Bond (POJK No 60 on 2017)
Source Reference Description
–
P 1.18 – Does the Framework require/ask FIs to create incentives for managers to reduce the ESG risk-level of the portfolio over a specified timeframe?
No
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
Pillar 1 - ESG Integration - Expectations of FI Actions
Policies & Procedures
P 1.19 – Does the Framework require/ask FIs to develop policies and procedures to identify, classify, measure, monitor, and manage ESG risks and performance throughout the financing cycle at the client level and/or the transaction/project level?
Yes
Source Reference Detail
–
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
page 7 – Article 4 (1)
P 1.20 – Does the Framework require/ask FIs to undertake a regular review and monitoring of ESG risk exposure at aggregate portfolio level?
No
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
P 1.21 – Does the Framework require/ask FIs to establish and maintain an external inquiry/complaints/grievance mechanism for interested and affected stakeholders in relation to ESG practices?
Yes
Source Reference Detail
Yes
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
page 24 and page 25 – 3) b. and 3) e. 6)
Pillar 1 - ESG Integration - Expectations of FI Actions
Tracking, Reporting & Disclosure
P 1.22 – Does the Framework require/ask FIs to report ESG risks and performance to the regulator or industry association?
Yes
Source Reference Detail
Yes
Source Reference Document
Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation ( 2018), p53
Source Reference Description
Page 53
P 1.23 – Does the Framework require/ask FIs to report on ESG integration publicly?
Yes
Source Reference Detail
Yes
Source Reference Document
Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation ( 2018), p53
Source Reference Description
Page 53
P 1.24 – Does the Framework require/ask FIs to track credit risk (e.g. loan defaults) and/or financial returns in relation to ESG risk level?
No
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
Pillar 2 - Climate Risk Management - Strategic Alignment
National Framework
P 2.25 – Has the regulator or industry association published a national framework (“Framework”) for the banking sector that sets out expectations for integrating the consideration and management of climate risks and their impact in the national economy?
Yes
Source Reference Detail
OJK – ROADMAP KEUANGAN BERKELANJUTAN TAHAP II Sustainable Finance Roadmap Phase II (2021 – 2025). Importance of climate risk as part of ESG issues and as a key component of risk management for FIs and financial sector, identified as a current gap. (Pages 11, 12, 29, 30). ESG risk management is a key Roadmap II priority (Page 31),and references the TCFD and the need to incorporate the management of climate-related physical and transition risks as a key component of risk management in the financial sector moving forward. Regulation NO. 51/POJK.03/2017 “Social and environmental risk management principle” (Article 2); Indonesia’s exposure to climate risks (Page 28) in the context of unlocking SF for climate mitigation and adaptation priorities and overall E&S risk management as reflected in “Priority sector development principle” (page 31). 2017 Technical Guidelines supporting the Regulation NO. 51/POJK.03/2017 includes E&S risk management in Principle 3 (“Managing Environmental and Social Risks”); Climate as an element of risk management in the context of supporting national climate priorities (Page 9), and climate is heavily emphasized as an area for financing sustainable and risk management activities, for example adaptation (Table 5.2, Section 8, page 31) and control of GHG emissions (Table 5.2, Section 8, Page 24.)
Source Reference Document
Sustainable Finance Roadmap 221 -2025 Sustainable Finance Regulation (POJK No 51 on 2017) Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation (OJK, 2018)
Source Reference Description
Refer to description
P 2.26 – Has the relevant regulator or industry association published a Framework for capital markets, investment, insurance or other non-lending FIs that sets out expectations for integrating the consideration and management of climate risks and their impact in the national economy?
Yes
Source Reference Detail
OJK – ROADMAP KEUANGAN BERKELANJUTAN TAHAP II Sustainable Finance Roadmap Phase II (2021 – 2025). Importance of climate risk as part of ESG issues and as a key component of risk management for FIs and financial sector, identified as a current gap. (Pages 11, 12, 29, 30). ESG risk management is a key Roadmap II priority (Page 31). Regulation NO. 51/POJK.03/2017 “Social and environmental risk management principle” (Article 2); Indonesia’s exposure to climate risks (Page 28) in the context of unlocking SF for climate mitigation and adaptation priorities and overall E&S risk management as reflected in “Priority sector development principle” (page 31). The Regulations notes that it is applicable to “APPLICATION OF SUSTAINABLE FINANCE TO FINANCIAL SERVICES INSTITUTION, ISSUER AND PUBLICLY LISTED COMPANY.” (Page 3).
Source Reference Document
Sustainable Finance Roadmap 2021 -2025 Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
OJK – ROADMAP KEUANGAN BERKELANJUTAN TAHAP II Sustainable Finance Roadmap Phase II (2021 – 2025). Importance of climate risk as part of ESG issues and as a key component of risk management for FIs and financial sector, identified as a current gap. (Pages 11, 12, 29, 30). ESG risk management is a key Roadmap II priority (Page 31). Regulation NO. 51/POJK.03/2017 “Social and environmental risk management principle” (Article 2); Indonesia’s exposure to climate risks (Page 28) in the context of unlocking SF for climate mitigation and adaptation priorities and overall E&S risk management as reflected in “Priority sector development principle” (page 31). The Regulations notes that it is applicable to “APPLICATION OF SUSTAINABLE FINANCE TO FINANCIAL SERVICES INSTITUTION, ISSUER AND PUBLICLY LISTED COMPANY.” (Page 3).
Pillar 2 - Climate Risk Management - Strategic Alignment
Alignment with International Goals & Standards
P 2.27 – Does the Framework make reference to international agreements or frameworks to address climate?
Yes
Source Reference Detail
OJK – ROADMAP KEUANGAN BERKELANJUTAN TAHAP II Sustainable Finance Roadmap Phase II (2021 – 2025), page 17. 2017 Technical Guidelines supporting the Regulation NO. 51/POJK.03/2017 mentions Paris Agreement and NDC, Page 17.
Source Reference Document
Sustainable Finance Roadmap 2021 -2025
Source Reference Description
OJK – ROADMAP KEUANGAN BERKELANJUTAN TAHAP II Sustainable Finance Roadmap Phase II (2021 – 2025), page 17. 2017 Technical Guidelines supporting the Regulation NO. 51/POJK.03/2017 mentions Paris Agreement and NDC, Page 17.
P 2.28 – Does the Framework recognize or align with established regional or international good practice for climate risk management and disclosure by FIs?
Yes
Source Reference Detail
OJK – ROADMAP KEUANGAN BERKELANJUTAN TAHAP II Sustainable Finance Roadmap Phase II (2021 – 2025), page 22 references TCFD. OJK a memeber of NGFS since 2020, and OJK active in G20 Climate Finance Study Group.
Source Reference Document
Sustainable Finance Roadmap 2021 -2025
Source Reference Description
Page 22
Pillar 2 - Climate Risk Management - Strategic Alignment
Alignment with National Goals & Strategies
P 2.29 – Has the regulator or industry association aligned the Framework with national goals to address climate change in line with the country’s Nationally Determined Contributions (NDCs) to the Paris Agreement?
No
Source Reference Detail
OJK – ROADMAP KEUANGAN BERKELANJUTAN TAHAP II Sustainable Finance Roadmap Phase II (2021 – 2025), page 17. 2017 Technical Guidelines supporting the Regulation NO. 51/POJK.03/2017 mentions Paris Agreement and NDC, Page 17.
Source Reference Document
Sustainable Finance Roadmap 2021 -2025
Source Reference Description
Page 17
P 2.30 – Does any cooperation exist between agencies, or between government and industry association, with respect to policy design or implementation related to climate risk management?
Yes
Source Reference Detail
OJK – ROADMAP KEUANGAN BERKELANJUTAN TAHAP II Sustainable Finance Roadmap Phase II (2021 – 2025), page 2 mentions collaborations of government agencies and industry associations on the Roadmap.
Source Reference Document
Sustainable Finance Roadmap 2021 -2025
Source Reference Description
Page 2
P 2.31 – Does any inter-agency data sharing currently exist related to climate risk management by FIs?
No
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
Pillar 2 - Climate Risk Management - Regulatory and Industry Association Actions
Overall Approach & Strategy
P 2.32 – Has the regulator or industry association undertaken research on historical impacts to the economy and financial sector from climate change, and/or future expected impacts resulting from physical and transition climate risks?
No
Source Reference Detail
OJK – ROADMAP KEUANGAN BERKELANJUTAN TAHAP II Sustainable Finance Roadmap Phase II (2021 – 2025). Importance of physical and transition climate risk (Pages 11, 12, 29, 30). OJK has signaled the ongoing preparation of studies on climate risk and related financial impacts in the Indonesian economy.
Source Reference Document
Sustainable Finance Roadmap 2021 -2025
Source Reference Description
Refer to description
P 2.33 -Does the Framework identify key sources of GHG emissions – such as in particular sectors – as priorities in the proactive management of climate risks by the financial sector?
Yes
Source Reference Detail
OJK – Roadmap for Sustainable Finance in Indonesia (PHASE 1 2015 – 2019), GHG intensive sectors in context of NDC, Table 1 (Page 11): Sector contribution towards the targeted GHG emission reduction. OJK – ROADMAP KEUANGAN BERKELANJUTAN TAHAP II Sustainable Finance Roadmap Phase II (2021 – 2025). Key sectors for managing climate risks as part of sustainable finance activities (Page 16, Figure 2).
Source Reference Document
Sustainable Finance Roadmap 2015 – 2019 Sustainable Finance Roadmap 2021 -2025
Source Reference Description
Refer to description
P 2.34 – Does the Framework incorporate the conservation/restoration of natural carbon sinks (such as oceans, forests, mangroves, grasslands, and soils) as an important part of reducing climate change risks? (e.g., through guidelines, scenario analysis, targets, or incentives for FIs)
Yes
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
P 2.35 – Has the regulator or industry association developed an internal strategy to address climate risk, and/or embedded climate risk management into its governance, organizational structures, and budget as part of the Framework?
Yes
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
P 2.36 – Has the regulator or industry association undertaken any activities to expand and deepen analytical understanding of national and/or cross-border physical and transition climate risks, and to raise awareness as to how these risks may transmit to, and impact, the financial sector?
Yes
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
Pillar 2 - Climate Risk Management - Regulatory and Industry Association Actions
Technical Guidance
P 2.37 – Has the regulator or industry association developed risk assessment approaches, methodologies, or tools to understand and assess the financial sector’s exposure to climate risk as part of the Framework?
Yes
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
Pillar 2 - Climate Risk Management - Regulatory and Industry Association Actions
Supervisory Activities & Incentives
P 2.38 – As part of the Framework, has the regulator clarified supervisory expectations with regard to climate risk management by FIs, including consideration of international good practices?
Yes
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
P 2.39 – Has the regulator started to explicitly embed climate-related risk in supervisory activities and review processes as part of the Framework?
No
Source Reference Detail
OJK – ROADMAP KEUANGAN BERKELANJUTAN TAHAP II Sustainable Finance Roadmap Phase II (2021 – 2025). Importance of climate risk as part of ESG issues and as a key component of risk management for FIs and financial sector, identified as a current gap. (Pages 11, 12, 29, 30). ESG risk management is a key Roadmap II priority (Page 31). Regulation NO. 51/POJK.03/2017 “Social and environmental risk management principle” (Article 2); Indonesia’s exposure to climate risks (Page 28) in the context of unlocking SF for climate mitigation and adaptation priorities and overall E&S risk management as reflected in “Priority sector development principle” (page 31). 2017 Technical Guidelines supporting the Regulation NO. 51/POJK.03/2017 includes E&S risk management in Principle 3 (“Managing Environmental and Social Risks”); Climate as an element of risk management in the context of supporting national climate priorities (Page 9), and climate is heavily emphasized as an area for financing sustainable and risk management activities, for example adaptation (Table 5.2, Section 8, page 31) and control of GHG emissions (Table 5.2, Section 8, Page 24.)
Source Reference Document
Sustainable Finance Roadmap 221 -2025 Sustainable Finance Regulation (POJK No 51 on 2017) Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation (OJK, 2018)
Source Reference Description
Refer to description
P 2.40 – Has the regulator started to explicitly embed climate-related risk in supervisory activities and review processes as part of the Framework?
Yes
Source Reference Detail
Regulation NO. 51/POJK.03/2017 Regulation NO. 51/POJK.03/2017 “Social and environmental risk management principle” (Article 2); Indonesia’s exposure to climate risks (Page 28). Section IV, Article 10 “SUBMISSION OF SUSTAINABLE FINANCE ACTION PLAN, REPORTING AND PUBLICATION” and Schedule II page 18 on Sustainability Report.
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
Refer to description
P 2.41 – Has the regulator started to explicitly embed climate-related risk in supervisory activities and review processes as part of the Framework?
No
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
Refer to description
Pillar 2 - Climate Risk Management - Regulatory and Industry Association Actions
Tracking & Aggregated Disclosure
P 2.42 – Does the regulator or industry association regularly collect and/or report market-level and/or FI-level data on climate-related financial sector risks as part of the Framework?
Yes
Source Reference Detail
OJK – ROADMAP KEUANGAN BERKELANJUTAN TAHAP II Sustainable Finance Roadmap Phase II (2021 – 2025). Importance of climate risk as part of ESG issues and as a key component of risk management for FIs and financial sector, identified as a current gap. (Pages 11, 12, 29, 30). ESG risk management is a key Roadmap II priority (Page 31),and references the TCFD and the need to incorporate the management of climate-related physical and transition risks as a key component of risk management in the financial sector moving forward. Regulation NO. 51/POJK.03/2017 Regulation NO. 51/POJK.03/2017 “Social and environmental risk management principle” (Article 2); Indonesia’s exposure to climate risks (Page 28). Section IV, Article 10 “SUBMISSION OF SUSTAINABLE FINANCE ACTION PLAN, REPORTING AND PUBLICATION” and Schedule II page 18 on Sustainability Report.
Source Reference Document
Sustainable Finance Roadmap 2021 -2025 Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
Pillar 2 - Climate Risk Management - Expectations of FI Actions
Strategy & Governance
P 2.43 – Does the Framework require/ask FIs to establish a strategy for climate risk management with responsibility at the board of director level (or highest governing body)?
Yes
Source Reference Detail
Importance of climate risk as part of ESG issues and as a key component of risk management for FIs and financial sector, identified as a current gap. (Pages 11, 12, 29, 30). ESG risk management is a key Roadmap II priority (Page 31),and references the TCFD and the need to incorporate the management of climate-related physical and transition risks as a key component of risk management in the financial sector moving forward. Regulation NO. 51/POJK.03/2017 “Social and environmental risk management principle” (Article 2); Indonesia’s exposure to climate risks (Page 28) in the context of unlocking SF for climate mitigation and adaptation priorities and overall E&S risk management as reflected in “Priority sector development principle” (page 31). Elucidation, Article 2, para #2 Point D “Governance Principle” (Page 30) and also Part II Sustainability Report Content, points #4 and #5, Pages 21-22. 2017 Technical Guidelines supporting the Regulation NO. 51/POJK.03/2017 elaborate Governance / Roles (pages 58-59 of Technical Guidelines).
Source Reference Document
Sustainable Finance Roadmap 2021 -2025 Sustainable Finance Regulation (POJK No 51 on 2017) Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation (OJK, 2018)
Source Reference Description
Refer to description
Pillar 2 - Climate Risk Management - Expectations of FI Actions
Organizational Structure & Capacity Building
P 2.44 – Does the Framework require/ask FIs to define the roles and responsibilities and related capacities of the FI’s senior management and operational staff in identifying, assessing, and managing climate-related financial risks and opportunities?
Yes
Source Reference Detail
Importance of climate risk as part of ESG issues and as a key component of risk management for FIs and financial sector, identified as a current gap. (Pages 11, 12, 29, 30). ESG risk management is a key Roadmap II priority (Page 31),and references the TCFD and the need to incorporate the management of climate-related physical and transition risks as a key component of risk management in the financial sector moving forward. Regulation NO. 51/POJK.03/2017 “Social and environmental risk management principle” (Article 2); Indonesia’s exposure to climate risks (Page 28) in the context of unlocking SF for climate mitigation and adaptation priorities and overall E&S risk management as reflected in “Priority sector development principle” (page 31). Elucidation, Article 2, para #2 Point D “Governance Principle” (Page 30) and also Part II Sustainability Report Content, points #4 and #5, Pages 21-22. 2017 Technical Guidelines supporting the Regulation NO. 51/POJK.03/2017 elaborate Governance / Roles (pages 58-59 of Technical Guidelines).
Source Reference Document
Sustainable Finance Roadmap2021 – 2025 Sustainable Finance Regulation (POJK No 51 on 2017) Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation (OJK, 2018)
Source Reference Description
Refer to description
Pillar 2 - Climate Risk Management - Expectations of FI Actions
Policies & Procedures
P 2.45 – Does the Framework require/ask FIs to expand existing risk management processes to identify, measure, monitor, and manage/mitigate financial risks from climate change?
No
Source Reference Detail
Importance of climate risk as part of ESG issues and as a key component of risk management for FIs and financial sector, identified as a current gap. (Pages 11, 12, 29, 30). ESG risk management is a key Roadmap II priority (Page 31),and references the TCFD and the need to incorporate the management of climate-related physical and transition risks as a key component of risk management in the financial sector moving forward. Regulation NO. 51/POJK.03/2017 “Social and environmental risk management principle” (Article 2); Indonesia’s exposure to climate risks (Page 28) in the context of unlocking SF for climate mitigation and adaptation priorities and overall E&S risk management as reflected in “Priority sector development principle” (page 31). Elucidation, Article 2, para #2 Point D “Governance Principle” (Page 30) and also Part II Sustainability Report Content, points #4 and #5, Pages 21-22. 2017 Technical Guidelines supporting the Regulation NO. 51/POJK.03/2017 elaborate Governance / Roles (pages 58-59 of Technical Guidelines).
Source Reference Document
Sustainable Finance Roadmap 2021 – 2025 Sustainable Finance Regulation (POJK No 51 on 2017) Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation (OJK, 2018)
Source Reference Description
Refer to description
Pillar 2 - Climate Risk Management - Regulatory and Industry Association Actions
Tracking, reporting & disclosure
P 2.46 – Does the Framework require/ask FIs to report on their overall approaches to climate risk management in line with international good practices (e.g., TCFD), or establish a timeline by which FIs should begin to align their reporting with such practices?
Yes
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
P 2.47 – Does the Framework require/ask FIs to identify, measure, and report on exposure to sectors which are vulnerable to transition risk and physical risk?
No
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
P 2.48 – Does the Framework require/ask FIs to adopt and report on performance targets to reduce portfolio greenhouse gas (GHG) emissions on a regular basis?
Yes
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
P 2.49 – Does the Framework require/ask FIs to adopt and report on performance targets to reduce exposure to climate change risks at the portfolio level on a regular basis?
Yes
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
Pillar 3 - Financing Sustainability - Strategic Alignment
National Framework
P 3.50 – Has the regulator or industry association published a national framework (“Framework”) for the banking sector that sets out expectations for integrating the consideration of instruments, goals, and standards for financing sustainability, including requirements for ensuring credibility and managing and measuring resulting impacts in the national economy?
Yes
Source Reference Detail
–
Source Reference Document
Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation (OJK, 2018)
Source Reference Description
–
P 3.51 – Has the relevant regulator or industry association published a Framework for capital markets, investment, insurance or other non-lending FIs that sets out expectations for integrating the consideration of instruments, goals, and standards for financing sustainability, including requirements for ensuring credibility and managing and measuring resulting impacts in the national economy
Yes
Source Reference Detail
–
Source Reference Document
Green Bond Regulation (POJK 60 on 2017)
Source Reference Description
–
Pillar 3 - Financing Sustainability - Strategic Alignment
Alignment with International Goals & Standards
P 3.52 – Has the regulator or industry association developed a strategy, regulations, or set of frameworks for stimulating the allocation of capital to sustainable assets, projects, and related sectors in line with global goals, such as the Sustainable Development Goals (SDGs)?
Yes
Source Reference Detail
–
Source Reference Document
Green Bond Regulation (POJK 60 on 2017)
Source Reference Description
–
P 3.53 – Does the Framework recognize and/or align with existing standards, voluntary principles, or market good practices related to sustainable finance instruments?
Yes
Source Reference Detail
–
Source Reference Document
Green Bond Regulation (POJK 60 on 2017)
Source Reference Description
Page 2
Pillar 3 - Financing Sustainability - Regulatory and Industry Association Actions
Alignment with national goals & strategies
P 3.54 – Does the Framework enable the achievement of stated national objectives by guiding capital to sectors, assets, and projects that have environmental and social benefits in line with national sustainable development priorities, strategies, targets, and the size of sustainable investment needs, and taking into account the local barriers to scaling-up sustainable finance?
Yes
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
P 3.55 – Does the Framework enable the achievement of stated national objectives by guiding capital to sectors, assets, and projects that have environmental and social benefits in line with national sustainable development priorities, strategies, targets, and the size of sustainable investment needs, and taking into account the local barriers to scaling-up sustainable finance?
Yes
Source Reference Detail
–
Source Reference Document
Green Bond Regulation (POJK 60 on 2017)
Source Reference Description
Page 18, 24, 25
P 3.56 – Does any inter-agency data sharing currently exist related to stimulating and monitoring sustainable finance flows?
Yes
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
Pillar 3 - Financing Sustainability - Strategic Alignment
Overall Approach & Strategy
P 3.57 – Does the Framework require/ask the regulator or industry association to establish mechanisms to identify and encourage the allocation of capital to sustainable sectors, assets, and projects?
No
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
Pillar 3 - Financing Sustainability - Regulatory and Industry Association Actions
Technical Guidance
P 3.58 – Does the Framework require/ask the regulator or industry association to establish mechanisms to identify and encourage the allocation of capital to sustainable sectors, assets, and projects?
Yes
Source Reference Detail
–
Source Reference Document
Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation (OJK, 2018) Sustainable Finance Regulation (POJK No 51 on 2017) Green Bond Regulation (POJK 60 on 2017)
Source Reference Description
(1) Page 55 – C 2 and page 6` – 6 a 2)table 7.3 (2) Page 7 – Section II Article 6 , Page 8 Point 1, Page 21, Page 25 – table 5.2 (3) Page 13 point 3, Page 14 point 4
P 3.59 – Does the Framework provide guidelines for extending green, social or sustainability-focused loans (excluding bonds)?
Yes
Source Reference Detail
–
Source Reference Document
Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation (OJK, 2018)
Source Reference Description
Page 61 – 6 a 2) table 7.3
P 3.60 – Does the Framework provide guidelines for issuance of green, social or sustainability bonds?
No
Source Reference Detail
–
Source Reference Document
Green Bond Regulation (POJK 60 on 2017)
Source Reference Description
Page 21
P 3.61 – Does the Framework require/ask for external party verification to ensure the credibility of sustainability instruments?
No
Source Reference Detail
–
Source Reference Document
Green Bond Regulation (POJK 60 on 2017)
Source Reference Description
Page 3, 6, 21,22
Pillar 3 - Financing Sustainability - Regulatory and Industry Association Actions -
Supervisory activities & incentives
P 3.62 – Does the regulator or industry association monitor information reported by FIs related to green/social/sustainability investment, lending, and other instruments to prevent greenwashing and social-washing?
No
Source Reference Detail
–
Source Reference Document
Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation (OJK, 2018)
Source Reference Description
–
P 3.63 – Are there any financial or non-financial incentives for FIs to develop and grow green, social, or sustainability finance instruments?
No
Source Reference Detail
–
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
Page 9 – Article 9 (1) b.c.
Pillar 3 - Financing Sustainability - Regulatory and Industry Association Actions -
Tracking & Aggregated Disclosure
P 3.64 – Does the regulator or industry association collect and/or publish data from FIs or other sources about allocation of capital to green/social/sustainability assets, projects, or sectors?
No
Source Reference Detail
–
Source Reference Document
–
Source Reference Description
–
Pillar 3 - Financing Sustainability - Expectations of FI Actions
Strategy & Governance
P 3.65 – Does the Framework require/ask FIs to establish a strategy, governance, or high-level targets, including at the Board of Directors level, for capital allocation to sustainable assets, projects, or sectors?
Yes
Source Reference Detail
Sustainable Finance Regulation (POJK No 51 on 2017) article 7and Annex 1 and 2 requires FI to state the high-level strategy on SF in its annual plan as well as annual Sustainability Report
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
Article 7
Pillar 3 - Financing Sustainability - Expectations of FI Actions
Organizational Structure & Capacity Building
P 3.66 – Does the Framework require/ask FIs to define internal staff roles and responsibilities to encourage finance flows to green, social, and/or sustainability-focused investments?
Yes
Source Reference Detail
Sustainable Finance Regulation (POJK No 51 on 2017) article 7 requires FI to provice continuous internal capacity building and adjustment of organization to implement SF and it should be customized to each bank’s strategy, size and needs. Further example of actions to be taken by banks is available in the technical guidelines for banks
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
Article 7
P 3.67 – Does the Framework require/ask FIs to develop and maintain internal staff capacity on green, social, or sustainability products through regular training and learning?
Yes
Source Reference Detail
Sustainable Finance Regulation (POJK No 51 on 2017) article 7 requires FI to provice continuous internal capacity building and adjustment of organization to implement SF and it should be customized to each bank’s strategy, size and needs. Further example of actions to be taken by banks is available in the technical guidelines for banks
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
Article 7
Pillar 3 - Financing Sustainability - Expectations of FI Actions
Policies & Procedures
P 3.68 – Does the Framework require/ask FIs to put in place policies and procedures for defining, issuing, managing proceeds, tracking performance, and reporting on green, social or sustainability-focused products?
Yes
Source Reference Detail
Sustainable Finance Regulation (POJK No 51 on 2017), requires Fis to adjust as it see fit internal procedures including proceeds, etc as well mandatory sustainability reporting and discloures.
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
–
P 3.69 – Does the Framework require/ask FIs to appoint an independent external reviewer to confirm that the FI’s internal framework meets the requirements of the recognized national framework and regulations, or aligns to international standards?
Yes
Source Reference Detail
–
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017) OJK Regulation about Issuing Green Bond (POJK No 60 on 2017)
Source Reference Description
(1) Page 18 – 1.2.g.
P 3.70 – Does the Framework require/ask that FIs create incentives for managers to increase sustainable loans or investments in the portfolio?
Yes
Source Reference Detail
Source Reference Document
–
Source Reference Description
–
Pillar 3 - Financing Sustainability - Expectations of FI Actions
Tracking, reporting & disclosure
P 3.71 – Does the Framework require/ask FIs to publish annual updates on the performance and impacts of the sustainability instruments in compliance with relevant national and/or international standards?
Yes
Source Reference Detail
It is mandatory for FI to publish Sustainability Report annually
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
–
P 3.72 – Does the Framework require/ask FIs to obtain and disclose independent review of metrics reported annually in relation to the social and environmental outcomes and impacts achieved through the sustainability instruments?
No
Source Reference Detail
–
Source Reference Document
Sustainable Finance Roadmap 221 -2025 Sustainable Finance Regulation (POJK No 51 on 2017) Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation (OJK, 2018)
Source Reference Description
Refer to description
P 3.73 – Does the Framework require/ask FIs to obtain and disclose independent review of metrics reported annually in relation to the social and environmental outcomes and impacts achieved through the sustainability instruments?
No
Source Reference Detail
–
Source Reference Document
Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation (OJK, 2018)
Source Reference Description
page 55 – C – 2. and page 61 – 6 a 2) table 7.3
P 3.74 – Does the Framework require/ask FIs to report to the regulator(s) or industry association(s) on green, social, and/or sustainability bonds or other positive impact investments?
No
Source Reference Detail
–
Source Reference Document
Technical Guidelines for Banks on the Implementation of Sustainable Finance Regulation (OJK, 2018)
Source Reference Description
page 55 – C – 2. and page 61 – 6 a 2) table 7.3
P 3.75 – Does the Framework require/ask FIs to report publicly on their green, social and sustainability-focused finance activities and positive outcomes or impacts (i.e. not only to the regulator or shareholders)?
No
Source Reference Detail
–
Source Reference Document
Sustainable Finance Regulation (POJK No 51 on 2017)
Source Reference Description
page 7 – Section II Article 6
