Citra Amelya, SVP Environmental, Social and Governance of PT
Bank Mandiri Tbk Group
Jakarta, IO – In coming years, collaboration between sectors, including finance, is expected to intensify to support the green economy, which is aligned with the government’s efforts to rid Indonesia of carbon emissions by 2060 (net zero carbon).
SVP Environmental, Social, and Governance (ESG) of PT Bank Mandiri Tbk (BMRI) Group Citra Amelya said that all sectors must share the same understanding of the importance of the green economy, particularly financing, as different parties would share various concepts regarding innovation.
“We must fully support it and its growth by providing careful regulations. Investors are flooding us with questions concerning regulations, rewards and punishments, incentives related to environmental, social, and governance (ESG), and sustainability issues. We must comprehend its primary purpose,” explained Citra at the 2023 Katadata Sustainability Action for the Future Economy (SAFE) Forum on Tuesday, September 26, 2023.
According to Citra, Bank Mandiri remains committed to developing sustainable banking by creating sustainable financial products, such as green financing and sustainable funding. As a state-owned bank, Bank Mandiri consistently pursues the green economy, including the development of the National Capital City (IKN).
Bank Mandiri’s sustainable portfolio distribution has reached IDR 242 trillion up to its first semester of 2023, with IDR 115 trillion for funding the ecology and IDR 127 trillion for social funding. The financing was allocated to a variety of sectors, with sustainable agriculture receiving the largest share at IDR 95.6 trillion, followed by the renewable energy sector at IDR 8.9 trillion, eco-efficient products at IDR 4.7 trillion, environmentally-friendly transportation at IDR 3.2 trillion, and other green sectors at IDR 2.8 trillion.
“We aim to provide a large share for sustainable portfolio holdings, from 25 to 30 percent over the next two years, with the amount adjusted depending on Bank Mandiri’s credit portfolio,” Citra explained. Bank Mandiri will additionally issue the second phase of green bond instruments, while the initial discharge of IDR 5 trillion was noted on July 4, 2023.
“We will once again issue green bonds in the near future; we are currently observing the market. Only IDR 5 trillion out of a total of IDR 10 trillion was issued,” stated Citra.
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Executive Director, Treasury & Markets Bank of DBS Indonesia, M. Suryo Mulyono, stated that the companies representing the nine sectors of the economy—the automobile, aviation, chemical, food and agribusiness, oil and gas, electric power, real estate, transportation, and steel industries—are committed to making a positive impact on the environment.
“These nine sectors account for over 90 percent of greenhouse gas emissions. We chose these nine sectors as they are highly related and significantly impact the environment and socio-economics.” Suryo concluded. (rp)