Jakarta. The MSCI Global Market Accessibility Review 2026 should be viewed as a warning about Indonesia's market quality rather than a referendum on its emerging market status, as shortcomings in transparency and information flow could undermine investor confidence and raise the country's risk premium, market analyst Hendra Wardana said on Friday.

Hendra, founder of Republik Investor, said MSCI's latest assessment highlighted persistent concerns among global investors, particularly regarding the transparency of share ownership structures and the quality of information flow in Indonesia's capital market.

"Transparency in share ownership is critical because it directly affects investor confidence," Hendra said in a statement.

He noted that global investors require clear information on a company's ultimate beneficial owners and the proportion of shares that are genuinely available for trading, or true free float.

"If this information is not transparent, investors will struggle to assess risks accurately. Liquidity may appear substantial on paper, while in reality, share ownership remains highly concentrated," he said.

Hendra also pointed to MSCI's concerns over indications of coordinated trading activity in Indonesia, warning that such practices could distort fair price discovery.

In an efficient market, stock prices should reflect company fundamentals and the natural interaction between supply and demand. However, engineered trading activity can undermine price discovery and erode global investors' trust in market integrity.

"Over the long term, this could increase the risk premium demanded by investors entering the Indonesian market," Hendra said.

The MSCI Global Market Accessibility Review 2026 evaluates markets across five accessibility segments comprising 18 criteria. Of those, only one criterion changed this year: Information Flow under the Market Infrastructure segment.

Overall, Indonesia received the highest rating of "++" in 10 of the 18 criteria, indicating alignment with global best practices and no significant issues. Six criteria were rated "+", while two remained in negative territory: Information Flow and Foreign Exchange Market Liberalization Level.

Hendra said the downgrade of Information Flow from positive to negative should serve as a wake-up call for regulators, as timely, comprehensive, and accessible information is a cornerstone of global investment.

He added that the limited availability of issuer disclosures in English continues to pose challenges for foreign investors by increasing information costs and complicating investment analysis.

"This downgrade could create the perception that information access in Indonesia has yet to fully meet international standards," he said.

Nevertheless, Hendra said the MSCI report should be seen as an opportunity for regulators and market participants to strengthen the competitiveness of Indonesia's capital market.

He said improving ownership transparency, intensifying oversight of suspicious trading activity, and expanding access to English-language disclosures would be key steps toward restoring investor confidence and attracting foreign capital inflows.

"The key message from this report is not merely about Indonesia's emerging market status, but a reminder that market quality must continue to improve," Hendra said.

MSCI's Global Market Accessibility Review is a qualitative assessment conducted separately from its Annual Market Classification Review. The classification review, which will determine Indonesia's market status, is scheduled to be announced on June 23 European time, or June 24 in Indonesia.