Jakarta. Indonesia’s newly launched sovereign wealth fund, Daya Anagata Nusantara (Danantara), is drawing attention not only for its ambitious $900 billion asset management target but also for concerns over oversight. The government maintains that Danantara remains fully accountable under the law, with multiple institutions ensuring transparency.

CEO Rosan Roeslani said Danantara is subject to rigorous oversight from the Supreme Audit Agency (BPK) and the Corruption Eradication Commission (KPK), while also reporting directly to President Prabowo Subianto. These assurances come as critics warn of potential governance risks, drawing comparisons to Malaysia’s 1Malaysia Development Berhad (1MDB) scandal, where weak oversight led to billions in state funds being misappropriated.

“There is no such thing as legal immunity in this country. The KPK has full authority, especially in cases of misconduct or criminal actions. BPK can audit, particularly for projects under Public Service Obligation (PSO),” Rosan said Monday at the Presidential Palace in Jakarta.

The 1MDB scandal, which resulted in the loss of over $4 billion, exposed how weak governance and political interference can compromise sovereign wealth funds. Originally established to drive economic development, 1MDB lacked independent oversight and was used as a vehicle for illicit financial transactions. Investigations revealed that its financial records were concealed from public scrutiny, while top officials, including then-Prime Minister Najib Razak, were directly involved in decision-making.

Rosan dismissed such concerns, saying Danantara would be among the most closely monitored entities in the country. “We will report directly to the president, and he will ensure all necessary oversight mechanisms are in place,” he said.

President Prabowo reaffirmed the government’s commitment to transparency, stating that Danantara would be managed with integrity and free from corruption.

“I am committed to leading a clean government, free from corruption, and I will fight it with all my strength,” Prabowo said at the fund’s launch. “The same principles will guide Danantara’s management.”

State-owned enterprise expert Toto Pranoto from the University of Indonesia said concerns over legal immunity and lack of oversight are misplaced, as the House of Representatives (DPR) and BPK can still investigate any irregularities within Danantara. Law enforcement agencies can also take legal action if misconduct, such as conflicts of interest in decision-making, is uncovered.

“These concerns can be addressed by looking at the wording of the new SOE law, which makes it clear that no entity is above the law,” Toto said during an Investor Daily Talk event on Monday.

He explained that the previous legal framework often discouraged SOE executives from making bold corporate moves, as any losses incurred could be classified as state financial losses, potentially leading to legal consequences. The new law introduces the business judgment rule (BJR), ensuring that as long as executives follow three key principles—avoiding conflicts of interest, conducting comprehensive feasibility studies, and implementing optimal risk mitigation—business losses will be considered normal commercial risks rather than legal violations.

“The new SOE law provides legal protection through the BJR framework, allowing executives to execute corporate actions with greater confidence,” Toto said. “So, in my view, Danantara is not above the law.”

To avoid a conflict of interest, Pandu Sjahrir has decided to step down as Deputy President Director of mining company TBS Energi Utama (TOBA) following his appointment as Danantara's Chief Investment Officer.