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Jakarta, June 22, 2023 - Lembaga Pembiayaan Ekspor Indonesia (LPEI) or Indonesia Eximbank, as the Special Mission Vehicle of the Ministry of Finance of the Republic of Indonesia, continues to commit to being an agent of transformation in the implementation of Environmental, Social & Governance (ESG). In line with the government's commitment to respond to climate change and achieve Net Zero Emission by 2060, LPEI is driving a number of ESG implementation initiatives as a standard for sustainable institutional performance.
Felia Salim, Member of the Board of Directors and Chairperson of the Risk Monitoring Committee of LPEI, stated in her speech at a seminar jointly organized by LPEI and Moody's Analytics, with the theme "Addressing Key Challenges in Climate Change" held at Djuanda I Building, Ministry of Finance of the Republic of Indonesia (June 21), that LPEI is committed to fulfilling its mandate by considering the principles of Environmental, Social, and Governance (ESG).
In implementing ESG, Felia stated that LPEI adheres to the principles of sustainable finance as regulated in the Financial Services Authority Regulation (POJK) No. 51/POJK.03/2017 concerning the Implementation of Sustainable Finance for Financial Institutions, Issuers, and Public Companies.
"Slowly but surely, LPEI is aligning its ESG policies and guidelines with the institution's mandate to promote national exports that go beyond financing, are sustainable, and create developmental impact," said Felia Salim.
LPEI will continue to align these ESG principles in its institutional policies through the Sustainable Financial Action Plan (RAKB), which is divided into Institutional ESG and Business Activity ESG. Through Institutional ESG, LPEI promotes environmentally friendly operational activities, including green offices, energy-saving measures, and a green carbon footprint.
In terms of Business Activity ESG, LPEI provides education to its customers on the importance of implementing ESG and the impact of climate change on their business sustainability. Additionally, LPEI also considers the multiplier effect created in terms of the economy, society, and the environment through capacity building programs for business actors in Indonesia, including the Desa Devisa program.
"We will proactively implement ESG principles. LPEI will play a role in the implementation of ESG to support a sustainable export ecosystem," she added.
Chief APAC Economist of Economic Solutions at Moody's Analytics, Steve Cochrane, stated that countries are still experiencing the economic impacts caused by the Covid-19 pandemic, even though they are currently in the process of recovery. Political tensions in several countries also contribute to global economic instability.
Steve added that there is economic resilience in Southeast Asian countries, including Indonesia, driven by strong domestic demand, supportive economic policies in Indonesia, and stable gross domestic product.
"While countries in America and Europe are still facing economic challenges, Southeast Asian countries are currently in an expansion phase. Indonesia, in particular, is currently expanding its business and is predicted to have a stronger economy next year," said Steve.
Meanwhile, Yasman Moghaddam, Director of the Global Industry Practice Group at Moody's Analytics, another speaker, stated that climate change has broader and more significant impacts on the economies of countries worldwide after the wave of the Covid-19 pandemic.
These impacts are divided into two categories: physical risks caused by extreme weather events that are increasingly frequent and other climate changes, and transition risks triggered by policies, technology, and consumer preferences. Both types of risks ultimately pose challenges to business and economic stability.
Yasman emphasized the importance of the role of financing institutions in raising awareness and implementing ESG in the business activities of business actors, especially exporters.
"Climate change is not only happening now but will also reflect our future in the next 20 years," added Yasman.
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Chesna F Anwar Corporate Secretary – Lembaga Pembiayaan Ekspor Indonesia
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