Indonesia bourse launches green equity designation
The designation was launched at the IDX Main Hall in Jakarta on Friday, with three listed companies receiving the inaugural designation.
PT Hero Global Investment Tbk (HGII) and PT Kencana Energi Lestari Tbk (KEEN) were designated Green Equity, while PT TBS Energi Utama Tbk (TOBA) was designated Green Equity Transition.
The three issuers had previously participated in the designation pilot with external review providers S&P Global Ratings and PT Sucofindo (Persero).
IDX President Director Jeffrey Hendrik said the designation would give companies greater visibility and provide investors with structured, measurable, transparent and independently reviewed information.
“The designation is expected to provide stronger visibility for companies, while providing more structured, measurable, transparent and independently verified information for investors,” Jeffrey said.
He said the designation was developed to help the market identify issuers making measurable contributions to green economic activities or the transition to a low-carbon economy.
For issuers, the designation is expected to improve visibility among sustainability-focused investors, broaden their investor base and expand access to sustainable financing.
For investors, it provides an additional reference for identifying companies whose business activities contribute to the green economy or its transition based on measurable criteria and independent review.
The framework refers to the Indonesia Sustainable Finance Taxonomy (TKBI) or other applicable taxonomy references and incorporates international best practices through the Green Equity Principles of the World Federation of Exchanges (WFE).
The designation framework is based on five pillars: Financial, Taxonomy, Governance, Assessment and Disclosure.
Financial measures contributions from green and/or transition activities through revenue and/or investment, while Taxonomy assesses the alignment of business activities with TKBI or other applicable taxonomy references.
Governance, periodic Assessment and public Disclosure of assessment results further support the framework.
The designation is voluntary and available to listed companies and prospective issuers that apply to the IDX and meet the criteria based on reports from external review providers.
The designations for HGII, KEEN and TOBA are effective from Aug. 28, 2026, through the annual evaluation period in July 2027.
To retain the designation, issuers must conduct periodic assessments, update relevant information and submit external review reports to the IDX according to the established mechanism.
The development of the designation began in 2025, involving four issuers and three external review providers in a pilot program.
The pilot was used to test the assessment framework and process, independent review mechanism and information disclosure before wider implementation.
Jeffrey said input and experience from the pilot were important to ensure the designation could be implemented credibly and meet the needs of Indonesia’s capital market.
“Going forward, we hope this initiative will not only improve the quality of sustainability disclosures, but also broaden the investor base, create opportunities for sustainable financing and encourage more companies to make sustainability part of their long-term growth strategies,” Jeffrey said.
As more issuers meet the criteria, the IDX expects the designation to help mobilize capital toward economic activities that contribute to environmental and sustainable development goals and support Indonesia’s transition to a low-carbon economy.
The IDX stressed that the designation is not a ranking, investment recommendation or guarantee of a stock’s financial performance, return or investment risk.
“Investors still need to conduct a comprehensive analysis and consider their risk profile and investment objectives before making investment decisions,” Jeffrey said.
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Translator: M Heriyanto, Martha Herlinawati Simanjuntak