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Indonesian companies with High Sustainability Content may miss main stock index inclusion

From Tempo · () Indonesian

Translated from Indonesian, summarized and contextualized by DistantNews.

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  • Indonesian companies potentially linked to High Sustainability Content (HSC) may not be included in the main stock index.
  • This exclusion applies to companies with a market capitalization below Rp 10 trillion.
  • The criteria are part of the index's methodology to ensure certain standards for listed companies.

Indonesian companies exhibiting High Sustainability Content (HSC) might be excluded from the main stock index, according to recent indications. This potential exclusion specifically targets firms with a market capitalization falling below Rp 10 trillion (approximately $630 million USD).

The criteria for inclusion in the main index are stringent, and this specific rule regarding market capitalization aims to ensure that only companies of a certain size and financial standing are represented. The focus on HSC suggests an effort to promote or acknowledge companies with strong sustainability practices, but the size requirement creates a barrier for smaller, potentially sustainable firms.

This development could impact investor interest and the visibility of smaller Indonesian companies that are committed to sustainability. The Indonesian Stock Exchange regularly reviews its index composition to reflect market dynamics and investor preferences.

DistantNews Editorial

Originally published by Tempo in Indonesian. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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