Regulations, Standards,

and Ratings

Luluk Widyawati, PhD.

REGULATIONS - INTERNATIONAL
 European Union: Sustainable Finance Package
o EU Taxonomy Climate Delegated Act
o Proposal for a Corporate Sustainability Reporting Directive (CSRD) –
Amend the Non-Financial Reporting Directive (NFRD)
Applicable to ± 11.700 companies in the EU

o Amending Delegated Acts on sustainability preferences, fiduciary duties

and product governance

 Singapore Stock Exchange

o The production of an annual sustainability report is a requirement
o On a “comply or explain” basis
o The issuer should select a sustainability reporting framework which is
appropriate for and suited to its industry and business model and
explain its choice
REGULATIONS-INDONESIA

 Perpres Nomor 59 Tahun 2017 tentang Pelaksanaan

Pencapaian Tujuan Pembangunan Berkelanjutan
o Sasaran nasional pencapaian SDGs menjadi acuan bagi pelaku usaha
terkait perencanaan, pelaksanaan, dan pemantauan inisiatif-inisiatif
SDGs
o Potensi munculnya peraturan nasional dan daerah terkait SDGs yang
dapat memberi dampak kepada operasional perusahaan

 Peraturan Pemerintah (PP) No. 47/2012 tentang Tanggung

Jawab Sosial Dan Lingkungan Perseroan Terbatas
o Tanggung jawab sosial dan lingkungan sebagaimana menjadi kewajiban
bagi Perseroan yang menjalankan kegiatan usahanya di bidang
dan/atau berkaitan dengan sumber daya alam
REGULATIONS-INDONESIA
 Roadmap Keuangan Berkelanjutan Tahap II (2021-2025)

Sumber: OJK
REGULATIONS-INDONESIA
 Peraturan Otoritas Jasa Keuangan Nomor
51/POJK.03/2017 tentang Penerapan Keuangan
Berkelanjutan bagi Lembaga Jasa Keuangan, Emiten, dan
Perusahaan Publik
o Lembaga Jasa Keuangan, Emiten, dan Perusahaan Publik wajib
Menyusun Laporan Keberlanjutan.
o Laporan Keberlanjutan wajib disampaikan kepada Otoritas Jasa
Keuangan setiap tahun paling lambat pada tanggal 30 April tahun
berikutnya (Apabila merupakan laporan tersendiri yang terpisah dari
Laporan Tahunan)
o Berlaku efektif bertahap sesuai dengan nilai aset
REGULATIONS-INDONESIA
 Surat Edaran Otoritas Jasa Keuangan Nomor
16/SEOJK.04/2021 tentang Bentuk dan Isi Laporan Tahunan
Emiten atau Perusahaan Publik
Laporan Keberlanjutan minimal memuat:
1. penjelasan strategi keberlanjutan;
2. ikhtisar aspek keberlanjutan (ekonomi, sosial, dan lingkunganhidup);
3. profil singkat Emiten atau Perusahaan Publik;
4. penjelasan Direksi;
5. tata kelola keberlanjutan;
6. kinerja keberlanjutan;
7. verifikasi tertulis dari pihak independen, jika ada;
8. lembar umpan balik (feedback) untuk pembaca, jika ada; dan
9. tanggapan Emiten atau Perusahaan Publik terhadap umpan balik
laporan tahun sebelumnya.
SUSTAINABILITY REPORTING STANDARDS –
OVERALL STANDARDS
 The Global Reporting Initiative (GRI)
o The GRI Standards

 The Value Reporting Foundation

o The Integrated Thinking Principles
o The Integrated Reporting Framework (IR)
o The SASB Standards

Main difference: targeted audience

To combine GRI and SASB:
https://www.sasb.org/knowledge-hub/practical-guide-to-sustainability-
reporting-using-gri-and-sasb-standards/
SUSTAINABILITY REPORTING STANDARDS –
TOPIC SPECIFIC STANDARDS
 The CDP (formerly the Carbon Disclosure Project)
o Climate Change Questionnaire
o Forests Questionnaire
o Water Security Questionnaire

 The Climate Disclosure Standards Board (CDSB)

o The CDSB Framework for reporting environmental and climate
change information
 The Task Force on Climate-related Financial Disclosures
(TCFD)
o The TCFD Recommendations
SUSTAINABILITY REPORTING STANDARDS –
CURRENT DEVELOPMENT
 The Taskforce on Nature-related Financial Disclosures
SUSTAINABILITY REPORTING STANDARDS –
CURRENT DEVELOPMENT
 IFRS: the Consultation Paper on Sustainability Reporting
o Establishment of International Sustainability Standards Board to Set
IFRS Sustainability Standards
 Updates of The GRI Standards
o Sector standards: Oil & Gas (2H 2021); Coal (End 2021); Agriculture
& Fishing (End 2021)
o Topic standards: Human Rights; Spills & Leaks; Indirect Economic
Impacts; Market Presence; Economic Performance
o Universal standards (2H 2021): Foundation; General Disclosures;
Management Approach
 Reporting on Sustainable Development Goals (SDGs)
 MAJOR SUSTAINABILITY RATINGS
Name Key Products Coverage
• MSCI ESG Ratings
MSCI • MSCI KLD
> 13,000

Refinitiv Refinitiv ESG Company Scores ± 9,000

Bloomberg Bloomberg ESG Disclosure Scores > 11,500

i • ESG Data
Sustainalytics • ESG Risk Ratings (from 2019)
> 10,000

• S&P Global ESG Scores

S&P Global • S&P Global
ii
Corporate Sustainability Assessment > 7,300
(CSA)
iii • ESG Assessments and Scores
VigeoEiris • SDG Assessment
± 4,500

iv • ESG Corporate Rating

ISS • ESG Country Rating
> 5,600

i
ii
Sustainalytics is affiliated with Morningstar.
S&P Global ESG Scores is based on SAM Corporate Sustainability Assessment (CSA). SAM CSA has been used for Dow Jones Sustainability Index
Iii
(DJSI).
VigeoEiris is a result of a merger between Vigeo and EIRIS in 2015. VigeoEiris is affiliated with Moody’s.
iv
ISS acquires Oekom Research in 2019.
SUSTAINABLE FINANCE INDEXES
Issuer/Analyst Main ESG Indexes
• Dow Jones Sustainability World Index
• Dow Jones Sustainability U.S. Composite Index
S&P • Dow Jones Sustainability Eurozone Region Index
• Dow Jones Sustainability Asia/Pacific Index
• Dow Jones Sustainability Emerging Markets Index
• FTSE4Good Index Series
FTSE Russell • FTSE4Good Emerging Indexes
• FTSE4Good ASEAN 5 Index
• MSCI KLD 400 Social Index
• MSCI Fixed Income ESG Index
MSCI • MSCI ACWI Sustainable Impact Index
• MSCI Emerging Markets ESG Leaders Index
• MSCI Indonesia ESG Leaders Index
• Refinitiv/S-Network ESG best practice indices
• Refinitiv Eurozone ESG Select Index
Refinitiv • Refinitiv Global Resource Protection Select Index
• Refinitiv IX Global ESG Equal Weighted Index
• Jantzi Social Index
Sustainalytics • Global Sustainability Signatories Index
• IDX ESG Leaders
MANAGING COMPLEXITY OF SUSTAINABILITY
REPORTING

* Among the WBCSD members

Source: WBCSD, 2020 (https://www.wbcsd.org/Programs/Redefining-Value/Reporting-matters/Resources/Reporting-matters-2020)
MANAGING COMPLEXITY OF SUSTAINABILITY
REPORTING

 Know your target audiences / main stakeholders

 Understand what sustainability means for your company
 Make sure to get buy in from top managemen
 Create a sustainability team – involve the employees
 Set a sustainability target
 Create and institutionalize a sustainability strategy
 Compliance could be a starting point

Sumber: De Micco, 2021 (https://doi.org/10.1108/MEDAR-09-2019-0555)

THE GREENWASHING TRIANGLE

Sumber: Kurpierz and Smith, 2020 (https://doi.org/10.1108/SAMPJ-10-2018-0272)

SUSTAINABILITY REPORT ASSURANCE*

* Among the WBCSD members

Source: WBCSD, 2020 (https://www.wbcsd.org/Programs/Redefining-Value/Reporting-matters/Resources/Reporting-matters-2020)
BEST PRACTICES

Sumber: WBCSD, 2020 (https://www.wbcsd.org/Programs/Redefining-Value/Reporting-matters/Resources/Reporting-matters-2020)