In this policy brief, it was found that Indonesia has made progress in sustainable financial regulations, but there is still a gap between regulations and practice in the field. Several banks have shown progress in sustainability policies, but acceleration is still needed to strengthen the role of banks in dealing with the climate crisis and improving social welfare.
Even though several banks have committed to addressing climate change, there are still banks that have not ratified this policy. The themes of financial inclusion and consumer protection received the highest average scores, while the themes of health, mining and gender equality received the lowest average scores.
The policy recommendations provided include increasing bank commitment to themes and sectors that still receive low ratings, such as health, gender equality, mining, climate change, and gas and oil. Banks also need to have a written policy regarding financing commitments, referring to existing sustainability criteria, and implementing a mandatory green taxonomy.
OJK also needs to encourage a sustainable financing and investment climate through policies and good practices carried out by financial services institutions. The implementation of sustainable finance and green financing needs to involve a multi-stakeholder task force including CSOs and the private sector.
Read the full Policy Brief volume 43 entitled "Reviewing Bank Sustainability Policies in Indonesia: Are They Serious Enough?" the following: