On Potential MSCI Weight Reduction, IDX: We Need Time

The Indonesia Stock Exchange (IDX) has spoken out regarding the potential for a reduction in Indonesia’s share weighting in the Morgan Stanley Capital International (MSCI) index in the short term. Acting IDX CEO Jeffrey Hendrik stated that the exchange’s actions align with MSCI’s stance on stocks with high ownership concentration. Previously, IDX had removed several stocks in the high shareholding concentration (HSC) category from the IDX80, LQ45, and IDX30 indices. According to him, if MSCI makes similar adjustments and no new Indonesian stocks enter the index, Indonesia’s weighting in MSCI could decrease in the short term. “So if MSCI does that and no new stocks enter our MSCI in the short term, it’s possible that Indonesia’s weighting will drop. But that is short-term pain. For long-term gain, we liken what we’re doing now to swallowing a bitter pill in the short term for long-term health,” said Jeffrey in his presentation at the IDX building on Monday (11/5/2026). IDX emphasised that the process of market transformation and reform is not yet complete and will continue sustainably. The exchange also admitted that it still needs time to prove the consistency of implementing the reform to global investors. “We still need time to prove our consistency in carrying out this commitment, and that’s what we will continue to do,” said Jeffrey. For the long term, IDX is optimistic that Indonesia’s weighting in MSCI can increase again, particularly through issuers meeting the minimum free float requirements. The exchange stated that it has divided the free float fulfilment targets into several market capitalisation groups and is continuously coordinating with the Indonesia Issuers Association and exchange members to accelerate its implementation. According to the schedule, MSCI will announce the results of the global index review, including the MSCI Indonesia Index, on 12 May 2026. The review covers a number of indices from MSCI Global Standard Indexes, MSCI Global Small Cap, MSCI Micro Cap Indexes, to MSCI Frontier Markets Small Cap Indexes, while rebalancing will be published on 29 May 2026.