Jakarta, IDN Times – PT Bank Rakyat Indonesia (Persero) Tbk or BRI ensures that to strengthen the commitment to implementing the principles Environmental, Social and Governance (ESG), the company aligns it with the corporate strategy.
This was stated by BRI Compliance Director Ahmad Solichin Lutfiyanto, at the event side event The G20 Indonesia presidency organized by Bank Indonesia (BI) with the theme Green and Sustainable Instruments as Alternative Financing and Investment & Indonesia’s SF Future Direction on 18 February 2022.
Solichin explained that at BRI, the implementation of ESG principles has been largely implemented in terms of assets, liabilities, operations, and human resources. He also emphasized the point of applying the principles of sustainable business, namely the company must know and understand framework-his.
“Then framework it must be a part of corporate strategy, so do not just follow the trend. So, first of all we have to sit down that what we do in ESG initiatives it must be part of corporate strategy,” he said.
1. 84% of BRI’s loan portfolio is for the MSME segment
With the campaign theme “Brilliant Friends of MSMEs”, BRI presented several fostered business clusters in the garden area of the BRI Head Office, Friday (10/9/2021). (Doc. BRI) Solichin gave an example, that this was the background for BRI in releasing sustainability bond in 2019 and did not vote green bond or social bond. This is also done through the identification of projects carried out by the company in the future in accordance with the corporate strategy, namely to become an MSME bank.
In fact, he said, currently 84 percent of the company’s loan portfolio is for the MSME segment. Through the application of ESG principles in line with corporate strategy, bond valued at US$500 million, it has also succeeded in attracting global investors, even experiencing over subscribed as much as 8 times.
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2. Social projects are mostly used to finance MSME empowerment
Committed to empowering MSMEs, BRI once again held the monthly agenda of the Mantriku Cluster Bazaar at BRI Head Office Jakarta on Friday (12/11). (Doc. BRI) Then, the investment must also be clear. Sustainability bond almost 70% used on social projects and the rest for green project related to LRT. As for related social projects mostly used for financing related to the empowerment of the MSME segment.
“Sustainability bond it’s on the liability side. It is one of BRI’s initiatives in the context of answering concern from stakeholders especially global investors because we are a public company, regarding the issue of ESG and we will gradually increase its implementation,” Solichin explained.
3. BRI periodically includes its performance and results in the annual report
BRI building landscape. (Doc. BRI) On the other hand, he continued, after implementing the ESG principle, to maintain investor confidence, the company regularly and continuously includes its performance and results in the company’s annual report, sustainability reports, and annual sustainability bond report.
“It is a responsibility to investors that bond purchased are invested in the projects we promise. In case When the BRI LRT is operational, it can reduce carbon emissions by around 8,000 tons of CO2 per year. From the credit that we give to MSMEs, especially micro and ultra-micro, it can already be done create new jobs and maintain business continuity for around 400,000 MSMEs in Indonesia. Well, that’s what we put in annual sustainability bond report“explained Solichin.
BRI’s commitment to implementing ESG is in line with Indonesia’s G20 Presidency in 2022 which carries the theme Recover Together, Recover Strongerto promote inclusive growth, people-centered, as well as environmentally friendly and sustainable in Indonesia. (WEB)
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