Good news for environmental enthusiasts is that Financial Service Authority of Indonesia (OJK) policy related to some companies that will be taken out from the list of loan receiver from Financial Service Institution because they are said to be the companies that damage environment.
Mulya Siregar as the Deputy of Komisioner Pengawasan Perbankan OJK said that it was the sustainable finance commitment that accentuated the harmony of economic, social, and environmental interest. This policy will be stated on OJK regulation (POJK) published in 2017 later. OJK has also published suistainable finance roadmap 2015-2019 on 5 December 2014.
On the roadmap, it was mentioned that the issue about finance sustainability is expected to bridge the economic interest and nature preservation, providing economic transformation, widening people’s access to be out of poverty, and also to uphold justice. This is done by considering social and environmental problem, which all these time has not been important component in economic measurement. With this policy, balance between interest to gain profit with the commitment to maintain environment and better social life will be achieved.
Furtherly, Mulya explained that financial institution, either bank or non bank, ideally could take part in upholding three economic balancing pillars that include people, planet, and profit. This was also mentioned because in his opinion, most of financial institution in Indonesia (especially bank) still concerned on profit and ignore the environmental impact done by a company.
According to him, all these time, the financing policy has only been implemented based on the environmental impact assessment (AMDAL) research, but this is not enough so the effort to limit loans for company that damages the environment could be the next policy.
Not only that, finance sustainable roadmap will also be guidance for OJK and other financial institution actors to implement strategic steps in distributing environmental-friendly financing, not only by bank sectoral, but also by non-bank financial institution and capital market under OJK watch.
During the making, Mulya said that China Banking Regulatory Commison (CBRC) was the guidance used in the sustainable finance making. This was based on the condition of China’s fast industrial growth along with the increase of critical environmental damage, so CBRC published Green Credit Guidelines in 2012. Other than that, this policy was also implemented by reffering to sustainable finance concept applied in Brazil, Bangladesh, Colombia, Mongolia, and Vietnam.
Although it was good for the environment, the policy was considered to affect bank performance in giving loans under the situation of sluggish growth of credit, so several companies that work in commodity sectors such as CPO, coals, and train, were threatened to be kicked out of the loans receiver list if their performance is proven to damage the environment.
Several banks that have supported POJK policy implementation plan are BNI, BRI, BCA, BNI Syariah, BJB, Bank Mandiri, Bank Muamalat, and Bank Artha Graha.