Capital Market Reforms Have a Positive Impact on Indonesia's Investment Climate
JAKARTA, KOMPAS.com - Capital market reforms are often perceived as technical policies relevant only to market participants. In reality, the direction and quality of capital market reforms have much broader implications, as they determine how competitive and credible a country is in the eyes of global investors. In this context, the reform measures being implemented in the Indonesian capital market deserve appreciation as an effort to strengthen the foundation for a long-term investment climate.
Markets with limited free float tend to have low liquidity, volatility that does not reflect fundamentals, and a high risk of concentrated ownership. For global institutional investors, these conditions reduce the investability of a market because they make it difficult to enter and exit investments on a large scale.
“The policy of increasing free float is a very important structural step. Better liquidity will strengthen healthy price formation mechanisms and increase the confidence of long-term investors,” said Syaiful in an official statement on Wednesday (25/2/2026).
According to him, a more adequate free float will improve the price discovery mechanism, increase liquidity, and expand the investor base. In the long term, a liquid and efficient capital market will be seen as more attractive to pension funds, insurance companies, and global asset managers that have long-term investment mandates and a risk-based approach.
Global investors not only assess potential returns but also consider non-financial risks such as governance, compliance, and reputation. He said that unclear or overly complex ownership structures are often perceived as additional sources of risk, even when a company’s financial performance appears good.
“Ownership transparency is the foundation of strong governance. With clarity about who the actual controller of an entity is, the market becomes more transparent and the risk of information asymmetry can be significantly reduced,” added Syaiful.