Implementation Status of Task Force on Climate-related Financial Disclosures (TCFD)
The Task Force on Climate-Related Financial Disclosures (TCFD) has recommended a voluntary financial disclosure on climate to assist financial markets in understanding the opportunities and risks faced and how they are managed and monitored. Recommendations from TCFD define strategy, risk management, governance, and company metrics and targets as core elements in dealing with climate change. TCFD also recommends relevant disclosure guidelines.
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The core elements of the TCFD recommendations are as follows:
Governance
Description
Corporate governance around climate-related risks and opportunities.
BRI’s Implementation Progress
The Board of Commissioners actively oversees the implementation of Sustainable Finance through the Board of Directors-Commissioners Meeting.
The oversight of the Board of Directors is conducted through the ESG Committee, which is responsible for formulating the implementation, monitoring, and evaluation of ESG and TJSL strategies, policies, and initiatives.
BRI strengthened the implementation of ESG aspects by reorganizing the ESG Desk into the ESG Division, which is responsible for the implementation of ESG and Sustainable Finance.
Strategy
Description
The actual and potential impact of climate-related risks and opportunities on a company's business, strategies, financial planning.
BRI’s Implementation Progress
BRI has completed the implementation guidelines and strategies for implementing sustainable finance as stated in the Directors' Circular Letter No. 52-DIR/ ESG/10/2022 concerning Sustainability Policies and Strategies, including BRI's sustainability strategy roadmap (2022-2026).
Analyzing climate change risks and opportunities to prepare BRI's strategy in dealing with climate change risks.
Implementing sustainable finance by preparing a Sustainable Finance Action Plan (RAKB), based on the mapping of the implementation of ESG aspects at BRI.
Developing products with ESG aspects, such as loans and sustainable bonds.
Supporting the development of clean energy production, such as through financing for PLT Bayu or Microhydro, building a certified biodiesel plant from palm oil, and LRT development project.
Increasing initiatives and programs that support Indonesia's net zero emissions target such as BRI Planting, developing green buildings, converting conventional vehicles to electric vehicles in BRI work units, etc.
Risk Management
Description
The process used by companies to identify, assess, and manage climate risk.
BRI’s Implementation Progress
BRI has established an ESG risk policy for the palm oil sector and in 2022 issued a financing policy for a specific sector, pulp, and paper sector.
In BRI's credit provisions, it has been determined that ESG analysis is information that is taken into consideration in the debtor's business analysis memorandum.
BRI has been selective in financing the fossil energy sector, such as oil and coal with sector limits.
Metrics & Targets
Description
Metrics and targets used to assess and manage relevant climate-related risks and opportunities.
BRI’s Implementation Progress
BRI has calculated emissions and classified its loan portfolio based on KUBL and THI.
BRI has mapped the linkages of work units in the implementation of sustainability/ESG which will become part of the KPI and be aligned with the work unit's initiative strategy.
