PSPK 1 and 2 from 2027: What It Means for Sustainability Reporting

For years, sustainability reports were often treated as an add-on to Corporate Social Responsibility (CSR) programs and a public relations tool. From financial year 2027, that changes. Indonesia’s Sustainability Disclosure Standards (PSPK) 1 and 2 require sustainability reports to be prepared with a discipline close to that of financial statements.

The change matters beyond listed companies. Suppliers, bank borrowers, and prospective investment partners will also feel it, because the entities required to report will ask them for sustainability data.

Sustainability reporting: from POJK 51/2017 to PSPK

Sustainability reporting in Indonesia has so far been based on POJK 51/POJK.03/2017, a regulation of the Financial Services Authority (OJK) that applies to financial institutions, listed companies, and public companies. It does not prescribe a single disclosure standard, so companies use different frameworks and the results are hard to compare.

The Sustainability Standards Board of the Indonesian Institute of Accountants (DSK IAI) ratified PSPK 1 and PSPK 2 on 1 July 2025. Both adopt IFRS S1 and IFRS S2 issued by the International Sustainability Standards Board (ISSB). PSPK 1 sets the general requirements for sustainability disclosures, while PSPK 2 covers climate-related disclosures. Early application is permitted.

What is changing

One entity, one period with the financial statements

A PSPK-based sustainability report is prepared for the same reporting entity and period as the financial statements, and in principle is published at the same time. As a result, sustainability data must be collected with the same consolidation boundary, deadlines, and controls as financial data.

The focus shifts to financial impact on the company

Older sustainability reports mostly described a company’s impact on the environment and society. PSPK focuses on sustainability risks and opportunities that could affect the company’s cash flows, access to finance, and cost of capital. Disclosures are organized around four areas: governance, strategy, risk management, and metrics and targets.

Emissions, including from the supply chain

PSPK 2 requires disclosure of greenhouse gas emissions in three scopes:

• Scope 1: direct emissions from the company’s own operations.
• Scope 2: emissions from purchased energy, such as electricity.
• Scope 3: emissions from the value chain, including suppliers.

The standard provides transition relief in the first year, including for Scope 3.

Who must apply

OJK will set the scope of mandatory application through a revision of POJK 51/2017, which as of July 2026 was in the final drafting stage. The impact can already be mapped, however. Listed companies need Scope 3 data from their suppliers. Banks reporting under PSPK 2 must also disclose their financed emissions, so they will ask borrowers for emissions data.

The carbon pricing context

Sustainability reporting also intersects with carbon pricing policy. Indonesia’s carbon economic value (NEK) framework is now governed by Presidential Regulation (Perpres) 110 of 2025, which replaced Perpres 98 of 2021. Carbon trading on the carbon exchange is regulated by OJK, most recently through POJK 10 of 2026.

The carbon tax itself already has a legal basis in Article 13 of the Harmonization of Tax Regulations Law (UU HPP), with a minimum rate of IDR 30 per kilogram of carbon dioxide equivalent. As of late September 2026, implementation remains postponed and no timetable has been set. In other words, there is no carbon tax burden today. Companies with well-organized emissions data will, however, be better prepared when carbon pricing instruments expand.

Illustration: from the ledger to emissions data

PT Contoh Jaya (a fictitious company) is a packaging manufacturer that supplies a listed company. Its customer has asked for 2026 emissions data for its Scope 3 disclosures.

Step 1: pull data from the books. The general ledger records electricity costs of IDR 2.2 billion and diesel generator fuel costs of IDR 680 million. Rupiah amounts alone are not enough. The finance team needs to pull volume data from the invoices: 1,500 megawatt hours (MWh) of electricity and 50,000 liters of diesel.

Step 2: convert to emissions. The calculation uses illustrative emission factors of 0.8 metric tons CO2e per MWh for electricity and 2.7 kilograms CO2e per liter for diesel:

• Scope 2 (electricity): 1,500 times 0.8 equals 1,200 metric tons CO2e.
• Scope 1 (diesel): 50,000 times 2.7 kilograms equals 135 metric tons CO2e.
• Total: 1,335 metric tons CO2e.

Step 3: document. Keep the data sources, the official emission factors used, and the person responsible for each figure. In practice, emission factors must follow the applicable official values, not the illustrative figures above.

The illustration shows that much of the emissions data already sits in the finance system. The challenge is to record volumes, not just rupiah amounts, and to keep them consistent.

What this means for your business

Boards of listed companies. Sustainability reports should be treated like financial statements, with clear ownership, internal controls, and a reporting timetable. Only a few months remain before financial year 2027.

CFOs and finance teams. Finance will become the main data provider. Accounting systems or ERPs need to capture non-financial data such as energy and fuel volumes, using the same entity boundary as the consolidation.

Suppliers and SMEs. Data requests from large customers will become more frequent. Companies that can provide simple but verifiable emissions data will be in a stronger negotiating position.

Investors and foreign partners. Because PSPK adopts IFRS S1 and S2, reports from Indonesian companies become easier to compare with those of companies in other countries.

Practical steps

1. Confirm whether your company, your customers, or your bank are required to report.
2. Assign responsibility for the sustainability report at board level.
3. Align the sustainability reporting boundary with the consolidation boundary of the financial statements.
4. Map data sources, namely energy, fuel, waste, and workforce, and the data owner at each site.
5. Adjust the accounting system so that volumes, not just rupiah amounts, are recorded.
6. Identify sustainability risks and opportunities that affect the company’s finances.
7. Run a trial report using 2026 data before the mandatory period begins.
8. Monitor the issuance of the revised POJK 51/2017 and carbon pricing policy.

Sustainability reporting is no longer about polishing an image. With PSPK in force, it becomes part of the information investors, banks, and customers use to assess a company’s prospects. Preparing now is far easier than chasing deadlines at the end of 2027.

AnB Consulting’s Advisory team can help you prepare your sustainability report and integrate sustainability data with your company’s financial systems. Contact us to discuss your readiness. https://anbconsulting.id/services

This article is for general information only and does not constitute tax or legal advice for any specific situation. For guidance on how it applies to your business, please contact the AnB Consulting team.