Universitas Gadjah Mada
Faculty of Economics and Business

The increasing concentration of greenhouse gasses in the Earth's atmosphere has led to global temperatures rising. Contributing to this problem are industrial activities that operate without regard to environmental impact, resulting in millions of tons of CO₂ emissions annually. The Indonesian government plans to implement a carbon trading scheme to encourage industries to reduce emissions.

IDX Development Director Jeffrey Hendrik discussed the IDXCarbon scheme at the National Green Economy Seminar at the FEB UGM Learning Building on Friday, November 8. He explained that IDXCarbon is a new carbon trading scheme launched by the Indonesia Stock Exchange (IDX) on September 26, 2023, which aims to develop a transparent, structured carbon market in line with global commitments to maximize Indonesia's carbon trading potential. A market-based approach was chosen to reduce carbon emissions as it is believed to effectively establish pricing and demand-supply dynamics, thereby incentivizing companies to reduce their carbon footprint.

Jeffrey noted that Indonesia has a relatively high potential for carbon trading. He compared Indonesia's carbon market with those of two other countries - Malaysia (Bursa Malaysia) and Japan (Japan Exchange Group) - launched in 2023. Indonesia achieved carbon trading with a total volume of 907,779 tons of CO₂, higher than Malaysia's 198,821 tons and Japan's 560,215 tons. However, he acknowledged that many aspects of IDXCarbon still need improvement. "The potential of our carbon market is huge. So we are optimistic that it can be maximized in the future," Jeffrey said.

To support decarbonization in Indonesia, the Carbon Exchange offers various programs for companies registered on IDXCarbon, such as workshops, outreach programs, and the IDX Net Zero Incubator. Companies listed on IDXCarbon can also benefit from long-term sustainability, regulatory compliance, enhanced corporate reputation, investor attraction, increased team member engagement, recruitment of young talent, sustainable supply chains, and competitive advantage.

"We offer the IDX Net Zero Incubator program because many companies still do not know how to measure their emissions. Through this program, we hope to help them manage their carbon emissions and support the decarbonization of Indonesia," said Jeffrey.

Reportage: Najwah Ariella Puteri
Editor: Kurnia Ekaptiningrum

Sustainable Development Goals