Jakarta. The issuance of sustainability-focused debt instruments is on the ascent in Indonesia, with Rp 13.6 trillion ($868.3 million) worth of green and social bonds issued throughout the last year, an official said on Tuesday.

Green bonds accounted for the majority of sustainability bonds, reaching Rp 12.9 trillion, while social bonds or Sukuk totaled Rp 700 billion, according to Inarno Djajadi, a commissioner with the Financial Services Authority (OJK).

Inarno expressed full support for the Indonesia Stock Exchange (IDX) and other capital market platforms in introducing business indices aimed at reinforcing environmental, social, and governance (ESG) principles. He made these remarks during the Investor Daily ESG Appreciation Night in Jakarta.

Presently, there are five ESG-oriented indices, namely the Sustainable and Responsible Investment Index (SRI-Kehati), IDX ESG Leaders, ESG Quality 45, IDX Kehati, and IDX LQ45 Low Carbon Leaders.

Inarno, responsible for overseeing capital markets, derivative finance, and the carbon bourse at the OJK, said his office has issued a specific regulation on the issuance of sustainability bonds and Sukuk. This regulation mandates that proceeds from green bonds be dedicated to financing activities with positive environmental impacts, while social bonds should support projects addressing social issues.

“The existence of the SRI Kehati index and other ESG-oriented indices provides guidance for investors in making business decisions to invest in publicly listed companies with sustainable businesses,” Inarno stated.

He stressed that ESG implementation is becoming more crucial for listed companies seeking added value by maintaining a fair balance between business activities and environmental preservation.

“In recent years, we have witnessed significant growth in ESG investments, indicating the growing demand for responsible investments,” Inarno concluded.

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