With issues such as climate change, ethical supply chains, environmental damage, and global welfare becoming more critical, environmental, social and governance (“ESG”) initiatives have quickly taken center stage as more investors, regulators, and other stakeholders now aim to conduct business in a way that positively contributes towards solving these issues. In Indonesia, ESG has quickly taken center stage after the Government of Indonesia declared its commitment to successfully implement the 17 UN Sustainable Development Goals by adopting the 2030 development agenda. To support this commitment, the Indonesian Stock Exchange (“IDX”) and the Financial Services Authority (“OJK”) have implemented a series of sustainable finance initiatives that are applicable to publicly listed entities and other financial institutions.

With that in mind, KPMG Indonesia’s Board Governance Forum (BGF) hosted a breakfast briefing session on Thursday, 24 August 2023 at our office. Budi Susanto, KPMG Indonesia's Deputy Managing Partner, started the session by warmly welcoming senior management, members of  the board and audit committees from various publicly listed entities and financial service sectors. Our ESG Assurance Leader Angga Pujaprayoga and our ESG Advisory Director Prabandari Moerti (Ririn) then took the stage to give an overview of ESG reporting and assurance in Indonesia. At the end of the interactive session, our Head of Clients & Markets, Susanto, conveyed the following key takeaways as the session came to a close:  

  • The first two IFRS® Sustainability Disclosure Standards mark a milestone in ISSB's vision to establish a global baseline for investor-focused sustainability reporting that local jurisdictions can build on. These standards are designed to support companies in identifying and communicating the information that investors need to make informed decisions. These standards offer reporting guidelines for global capital markets and provide investors with globally comparable information. Indonesia has yet to adopt these standards. However, IAI is forming the Sustainability Standards Board to lead in the development and alignment of information on sustainability and financial statements.
  • As business becomes more globalized, there will be increased pressure and expectations from external stakeholders (such as key customers, investors, shareholders, and regulators) over the need for high quality ESG reporting. Senior management’s awareness and acknowledgment of these issues are important for quality ESG reporting.
  • No organization can build its ESG infrastructure in a day. Adequate systems, processes, and controls are needed for high quality sustainability-related financial disclosures. Your action today could define the future of your corporate reporting.
  • ESG reporting will bring big changes to both corporate governance and corporate reporting. Our journey has just begun. Corporate reporting will need to be comprehensive, covering both financial and non-financial reporting. Auditors, by independently validating ESG information through limited or reasonable assurance, will contribute to the reliability of the information reported.  This will enhance the trust and confidence in ESG reporting which will gain the attention of boards and audit committees.

Together, we can shape a future where quality ESG reporting defines corporate excellence.

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KPMG Indonesia’s Partner in Charge Board Governance Forum


Harry Widjaja
Partner, Audit & Assurance Services
KPMG in Indonesia
Email: Harry.Widjaja@kpmg.co.id  

LinkedIn ProfileKPMG Board Governance Forum

Harry is a partner in Audit & Assurance Services at KPMG Indonesia. He has more than 17 years of audit experience encompassing automotive, trading and services sectors.​ A member of the Indonesian Institute of Certified Public Accountants (IAPI), he is now looking after KPMG Indonesia’s Board Governance Forum.