IDX Launches Green Equity Designation

PT Bursa Efek Indonesia (BEI) officially launched the IDX Green Equity Designation on Friday (28/8), as a strategic step to strengthen the sustainable finance ecosystem in Indonesia’s capital market. Through this initiative, BEI provides special designation to shares of listed companies that meet the criteria for green economic activities and/or transition towards a low-carbon economy. The designation is expected to provide stronger visibility for companies, while offering more structured, measurable, transparent, and independently verified information for investors.

In the inaugural launch of the IDX Green Equity Designation, BEI designated three listed companies: PT Hero Global Investment Tbk (HGII) as Green Equity; PT Kencana Energi Lestari Tbk (KEEN) as Green Equity; and PT TBS Energi Utama Tbk (TOBA) as Green Equity Transition. The three companies had previously participated in the piloting process for the Green Equity Designation together with External Review Providers, namely S&P Global Ratings and PT SUCOFINDO (PERSERO).

The IDX Green Equity Designation was developed to help the market identify listed companies that have measurable contributions to green economic activities or transition processes. This initiative is also part of BEI’s efforts to encourage sustainability aspects to be increasingly integrated with business strategy and long-term corporate value creation. For listed companies, this designation is expected to increase visibility to investors who consider sustainability aspects and open opportunities to expand the investor base and access to sustainable financing.

For investors, the designation provides an additional reference in identifying companies whose business activities contribute to the green economy or transition, based on measurable criteria that have undergone independent review.

The IDX Green Equity Designation was developed with reference to the Indonesian Taxonomy for Sustainable Finance (TKBI) or other taxonomy references as the basis for measuring business activities that meet green economic activity criteria, and is complemented by international best practices through the Green Equity Principles from the World Federation of Exchanges (WFE).

The designation framework is supported by five main pillars: Financial, Taxonomy, Governance, Assessment, and Disclosure. The Financial aspect measures the contribution of green and/or transition activities through revenue and/or investment. The Taxonomy aspect assesses the alignment of business activities with TKBI or other applicable taxonomy references. The framework is further strengthened through governance aspects, periodic assessment, and public disclosure of assessment results.

The designation is given voluntarily to shares of listed companies or prospective listed companies that submit an application to BEI and meet the criteria based on the review report from an External Review Provider. The designation for HGII, KEEN, and TOBA is valid from 28 August 2026 until the annual evaluation period in July 2027. To maintain the designation, listed companies are required to conduct periodic assessments, update relevant information, and submit review reports from External Review Providers to BEI in accordance with the established mechanism.

The development of the Green Equity Designation began in 2025 involving four listed companies and three External Review Providers in the piloting process. The process was used to test the framework and assessment process, independent review mechanism, and information disclosure before the initiative was implemented more broadly. Input and experience from the piloting process became an important part in ensuring the IDX Green Equity Designation can be applied credibly and in accordance with the needs of Indonesia’s capital market.

“The IDX Green Equity Designation is an important milestone in building an Indonesian capital market that is increasingly transparent, credible, and sustainability-oriented. Through this initiative, BEI aims to provide stronger visibility to listed companies that have real contributions to the green economy and transition, while providing better references for investors in allocating their capital,” said BEI President Director Jeffrey Hendrik.

“Going forward, we hope this initiative will not only improve the quality of sustainability information disclosure, but also expand the investor base, open sustainable financing opportunities, and encourage more companies to make sustainability part of their long-term growth strategy,” he added.

Going forward, the IDX Green Equity Designation is expected to become one of the foundations for developing a sustainable product and investment ecosystem in Indonesia’s capital market, including as a reference for the development of indices, investment products, and sustainability-based funding instruments.

With more listed companies meeting the criteria, BEI hopes to encourage capital mobilisation towards economic activities that make positive contributions to environmental goals and sustainable development, while supporting Indonesia’s transition towards a low-carbon economy.

This initiative also strengthens the position of the capital market as part of an ecosystem that connects companies needing capital to grow and transition with investors who increasingly consider sustainability aspects in their investment decisions.

BEI emphasised that the IDX Green Equity Designation is not a rating, investment recommendation, or endorsement of a company’s financial performance.