OJK Strengthens Climate Risk Framework, Partners UK on Green Finance

Jakartaweekly.com – The Indonesia Finance Authority or Otoritas Jasa Keuangan (OJK), together with the national banking industry, has reinforced its commitment to supporting Indonesia’s transition toward a low-carbon economy by strengthening climate risk management, enhancing banking sector resilience, and expanding international cooperation in sustainable finance.

This commitment was reaffirmed at The 2nd Indonesia Climate Banking Forum (ICBF): Climate Risk Management and Banking Resilience to Support Climate Finance Investment, held in Jakarta on Thursday.

The second ICBF follows the inaugural forum in 2024, which marked the launch of the Climate Risk Management & Scenario Analysis (CRMS) framework as an initial milestone in establishing structured and comprehensive climate risk management in the banking sector.

Acting Chair of the OJK Board of Commissioners, Friderica Widyasari Dewi, stated in her remarks that transforming Indonesia’s financial system into one that is climate-aligned is an integral part of OJK’s and the financial services sector’s commitment to supporting national development strategies and policy directions.

“We welcome the strong support from the United Kingdom Government and the British Embassy in encouraging the establishment of a Joint Climate Financing Working Group with OJK. This collaboration is expected to accelerate innovation in transition financing while deepening the strategic partnership between Indonesia and the United Kingdom, as reaffirmed by President of the Republic of Indonesia Prabowo Subianto,” Friderica said on the press statement (26/2).

According to her, OJK views climate risk management as a forward-looking strategic component within its supervisory architecture, serving as a bridge to translate national transition policies and global signals into financial sector governance, risk management, and financing allocation.

On the same occasion, OJK and the UK Government officially launched the Indonesia–UK Strategic Partnership Working Group on Climate Financing, further strengthening bilateral cooperation in mobilizing funding to support sustainable finance initiatives.

The establishment of the Working Group follows the strategic partnership agreed upon by President Prabowo Subianto and UK Prime Minister Keir Starmer in January.

The Working Group was formally inaugurated by UK Minister for the Indo-Pacific Seema Malhotra, British Ambassador to Indonesia Dominic Jermey, Acting OJK Chair Friderica Widyasari Dewi, and OJK Chief Executive of Banking Supervision Dian Ediana Rae.