Fa ihah, El a; Ha adina a, Ok a Sindhu; Anidah Robani; Yuliawan, Rahma
A icle
Assessing banks' pe o mance in sus ainabili y p ac ices
and p og ams du ing he COVID-19 pandemic: The case o
Indonesian banks
Global Business & Finance Re iew (GBFR)
P o ided in Coope a ion wi h:
People & Global Business Associa ion (P&GBA), Seoul
Sugges ed Ci a ion: Fa ihah, El a; Ha adina a, Ok a Sindhu; Anidah Robani; Yuliawan, Rahma
(2024) : Assessing banks' pe o mance in sus ainabili y p ac ices and p og ams du ing he
COVID-19 pandemic: The case o Indonesian banks, Global Business & Finance Re iew (GBFR), ISSN
2384-1648, People & Global Business Associa ion (P&GBA), Seoul, Vol. 29, Iss. 6, pp. 31-46,
h ps://doi.o g/10.17549/gb .2024.29.6.31
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o inancial sus ainabili y and people-cen e ed global business1)
A
ssessing Banks' Pe o mance in Sus ainabili y P ac ices and P og am
s
du ing he COVID-19 Pandemic: The Case o Indonesian Banks
El a Fa ihaha, Ok a Sindhu Ha adina ab, Anidah Robanic†, Rahma Yuliawand
aLec u e , Facul y o Voca ional S udies, Uni e si as Ai langga, Su abaya, Jawa Timu 60115, Indonesia
bLec u e , Facul y o Economics & Business, Uni e si as Ai langga, Su abaya, Jawa Timu 60115, Indonesia
cSenio Lec u e , Ins i u e o Technology Managemen and En ep eneu ship Uni e si i Teknikal Malaysia Melaka, Hang Tuah Jaya, 7610
0
Du ian Tunggal, Melaka, Malaysia
dSenio Lec u e , Facul y o Voca ional S udies, Uni e si as Ai langga, Su abaya, Jawa Timu 60115, Indonesia
A
B S T R A C T
Pu pose: This s udy aims o examine he sus ainable banking pe o mance wi hin he Indonesian banking sec o
du ing he COVID-19 pandemic yea s o 2020 and 2021.
Design/me hodology/app oach: The s udy ocuses on e alua ing he sus ainable banking pe o mance o banks lis ed
on he Indonesia S ock Exchange. Seconda y da a sou ced om he banks' o icial websi es, including sus ainabili y
and annual epo s, we e u ilized o analysis. Quan i a i e analysis was conduc ed h ough con en and s a is ical
analyses. The assessmen o sus ainable pe o mance is guided by he amewo ks p o ided by he Financial Se ices
Au ho i y and he Global Repo ing Ini ia i e.
Findings: The e is a disce nible di e ence in sus ainable banking pe o mance be ween 2020 and 2021. This a ia ion
indica es a disc epancy in bank pe o mance as measu ed by he Sus ainable Banking Index (SBI) be ween he ansi-
ional pe iod o he implemen a ion o he second OJK oadmap in 2020 and a e he implemen a ion o he second
OJK oadmap in 2021. The p esence o he Financial Se ices Au ho i y's Sus ainable Finance Roadmap Phase II
u he elucida es he sus ainable banking pe o mance a ge . Addi ionally, he alignmen o sus ainable inance p in-
ciples wi h pos -pandemic economic eco e y p esen s an oppo uni y o ebuild a esilien economy. The posi i e
impac s obse ed signi y an oppo uni y o he banking sec o s o expedi e he adop ion o sus ainable inance.
Resea ch limi a ions/implica ions: Limi a ions o his esea ch include eliance on seconda y da a, wi h he da a
ga he ed limi ed o he yea s 2020-2021, and he scope being limi ed o banks lis ed on he Indonesia S ock Exchange.
None heless, he indings sugges ha egula o y amewo ks p omo ing sus ainabili y can heigh en banks' conscious-
ness owa d disclosu e and implemen a ion, he eby enhancing hei sus ainable banking pe o mance. Fu he mo e,
he alignmen o sus ainabili y p inciples wi h pos -pandemic economic eco e y p esen s an oppo uni y o os e ing
a esilien economy.
O iginali y/ alue: This s udy may be bene icial in enhancing he unde s anding o sus ainable banking p ac ices
du ing imes o c isis, shedding ligh on he impo ance o egula o y measu es and sus ainabili y p inciples in shaping
banks' esponses and pe o mance wi hin he Indonesian con ex . Addi ionally, he s udy de elops a amewo k o
assessing sus ainable banking pe o mance by elabo a ing on he egula ions o he Financial Se ices Au ho i y
(OJK) and GRI guidelines o he banking sec o in Indonesia. Howe e , sus ainabili y p ac ices and p og ams in
banks a e highly dependen on egional ac o s, socioeconomic de elopmen le els, consume p e e ences, and egu-
la o y en i onmen s. The e o e, u u e esea ch may adjus he amewo ks acco ding o he condi ions o each coun y.
Keywo ds: Bank, Banking pe o mance, Sus ainabili y, COVID-19, Indonesia
GLOBAL BUSINESS & FINANCE REVIEW, Volume. 29 Issue. 6 (JULY 2024), 31-46
32
I. In oduc ion
Since he end o 2019, humans ha e aced p oblems
caused by he ou b eak o co ona i us (COVID-19).
I has c ea ed bo h se ious heal h and economic
p oblems. Mo eo e , as a i us con ainmen ac ion,
lockdowns ha e pushed he global economy in o a
wo s economic c isis. COVID-19 is also a signal
o an en i onmen al c isis. Acco ding o ecen
esea ch, he sp ead o he i us and i s consequences
on human heal h was caused by clima e change. I
has been p o en ha he inc ease in empe a u e and
low ai quali y is signi ican ly associa ed wi h he
COVID-19 pandemic (Bashi e al. 2020). Fu he mo e,
COVID-19 mu a ions a e g owing as e due o
clima e change (Volko 2022).
This indica es ha wo app oaches a e needed o
sol e he p oblems simul aneously. Fi s , in he sho
e m, i is necessa y o eco e he economy as soon
as possible. In his case, go e nmen s esponded o
he impac o COVID-19 in he o m o s imulus
paymen s, elie packages, and se e al economic
policies, including mone a y and iscal policies
(Fa ihah and Ha adina a 2021; Luo e al. 2022).
Second, o a long- e m pos -COVID-19 eco e y,
he economy mus be managed mo e sus ainably.
E hical and g een inance can be a solu ion o achie e
his goal because i conside s En i onmen al, Social,
and Go e nmen (ESG) issues in op imizing long-
e m inancial e u n (Schoenmake 2017). I can help
o o e come economic and en i onmen al c ises
because o i s capaci y o ga he esou ces o p omo e
in es men and d i e economic g ow h wi h a low
social-en i onmen al impac . I can a ec in es men
decision-making p ocess (Pa k and Noh, 2018)
Ha ing a signi ican ole in he inancial sys em,
he banking sec o is also no spa ed om he
dis up ion caused by COVID-19. Unde his si ua ion,
banks a e e y ulne able because many deb o s ha e
di icul y paying hei deb s (S ephen G. Cecche i
and Schoenhol z 2020). I leads o a ious isks, such
as inancial, insol ency, bank up cy, and liquidi y
isks. The e o e, se e al s a egies ha ha e been
ca ied ou o be esilien and su i e his pandemic
include c edi es uc u ing, digi alizing se ices,
p o iding assis ance o small and medium en e p ises,
and making inno a ions in bo h p oduc s and se ices
(Khai a Siho ang and Hasanah 2021).
In he con ex o long- e m pos -COVID-19
eco e y, banks play a signi ican ole in ebuilding
a esilien economy h ough sus ainabili y p ac ices
and p og ams. Banks play a ca aly ic ole in
in luencing he e hical and g een inance o o he
indus ies, especially hei deb o s. Banks, along wi h
he go e nmen and ele an s akeholde s, need o
wo k oge he o ealize a be e sus ainable pe -
o mance o achie e he iple bo om line business
concep . The iple bo om line is a business concep
ha equi es companies o measu e social and
en i onmen al impac as well as inancial pe o mance
(Elking on 2013).
In he pas wo decades, sus ainabili y codes o
conduc ha e been de eloped and adop ed widely by
o ganiza ions, making hem disclose hei sus ainabili y
p ac ices and p og ams. The codes a e he Uni ed
Na ions Global Compac (UNGC) p inciple, Global
Repo ing Ini ia i es (GRI), Uni ed Na ions En i -
onmen P og am Finance Ini ia i e (UNEP FI),
Equa o P inciple, and ISO 14000-26000 (Islam e
al. 2016; Kuma and P akash 2019). Se e al coun ies
ha e also issued sus ainabili y guidelines ha a e
specially in ended o o ganiza ions in each coun y;
examples o hese coun ies a e A gen ina, China,
Indonesia, Sou h A ica, Nige ia, and Mo occo
(Maimbo and Zadek 2017).
As a de eloping coun y, Indonesia has demons a ed
i s commi men o p omo ing sus ainabili y. Financial
Se ice Au ho i y (OJK), which is an in eg al pa
o he coun y, launched he oadmap o sus ainable
inance, which is di ided in o wo s ages
—
Phase I
(2015-2019) and Phase II (2020-2024) (Financial
Se ices Au ho i y (OJK) 2014). OJK also issued
egula ion POJK No.51/POJK.03/2017, which is
abou Sus ainable Finance o Financial Se ices
Ins i u ions, Issue s, and Public Companies. I obliges
inancial ins i u ions o apply sus ainable economic
p inciples o achie e a sus ainable economy.
El a Fa ihah, Ok a Sindhu Ha adina a, Anidah Robani, Rahma Yuliawan
33
Banks o Indonesia esponded en husias ically o
OJK's policies (Meu ia e al. 2020). The Sus ainable
Banking Ne wo k (SBN) has posi ioned Indonesia
as he i s mo e along wi h China in implemen ing
sus ainabili y (In e na ional Finance Co po a ion (IFC)
2019). I has been p o en ha he exis ence o
egula ion can inc ease banks' awa eness o implemen
sus ainabili y (Webe and Oni 2015). Howe e , he
sus ainable banking pe o mance o Indonesian banks
is s ill low (Gunawan e al. 2022). This is due o he
lack o unde s anding, knowledge, and compe ence o
human esou ces abou sus ainabili y (Halima ussadiah
e al. 2018). These gaps mus be esol ed immedia ely
so ha banks can un he Sus ainable Finance
Roadmap Phase II wi h be e pe o mance.
The Sus ainable Finance Roadmap Phase II was
implemen ed in 2020. Howe e , he implemen a ion
was pos poned o 2021-2025 due o he COVID-19
pandemic (Financial Se ices Au ho i y (OJK) 2021).
The pos ponemen can be an oppo uni y o he
banking sec o o p epa e be e s a egies o
accele a ing sus ainabili y. Fo banks, sus ainabili y
p ac ices and p og ams can inc ease hei e iciencies
and lowe isk h ough cos educ ion (Kosasih e
al. 2021). In addi ion, companies ha e s a ed o
modi y hei ope a ional ac i i ies o be mo e
eco- iendly (Chong e al. 2022). The e o e, banks
can di e si y hei p oduc s and se ices o inc ease
p o i abili y.
S udies ha highligh sus ainable banking
pe o mance in Indonesia a e gene ally based on
compliance in disclosing sus ainabili y p ac ices and
p og ams based on egula ions o he Financial
Se ices Au ho i y (OJK) (Meu ia e al. 2020; Wan a
and He awa i 2021) and GRI (Andania and Yadnya
2020; Gunawan e al. 2022). The e o e, his s udy
aims o assess sus ainable banking pe o mance based
on Financial Se ices Au ho i y (OJK) egula ions
and GRI o he banking sec o in Indonesia. I equi es
an assessmen policy o s anda dize he sus ainabili y
pe o mance in he banking sec o so ha banks can
compe e o ge he bes p edica e in sus ainable
banking pe o mance (Se yowa i 2020). He e, a
comp ehensi e pe o mance app aisal amewo k is
needed o ob ain accu a e esul s.
This s udy a emp s o p o ide new insigh in o
sus ainable banking pe o mance in Indonesia du ing
he COVID-19 pandemic. Banks ace a ious isks
due o he down u n in he economy caused by
COVID-19, which may se iously hinde sus ainabili y
p ac ices and p og ams. Nex , his s udy ocuses on
assessing he sus ainable banking pe o mance o
banks lis ed on he Indonesia S ock Exchange (IDX)
du ing he pandemic (2020-2021). I aims o
in es iga e he ex en o sus ainable banking adop ion
in Indonesian banking sec o s du ing he ea ly yea s
o he COVID-19 pandemic. Fu he mo e, i es s
whe he he e was a di e ence in sus ainable banking
pe o mance in 2020 and 2021. This is e y impo an
because he p esence o he COVID-19 pandemic
made 2020 a gap yea o he implemen a ion o
he Sus ainable Finance Roadmap Phase II.
The es o his a icle is o ganized as ollows.
Sec ion 2 p esen s an o e iew o Indonesian banks
du ing he COVID-19 pandemic, sus ainabili y
p ac ices and p og ams in he Indonesian banking
sec o , and a amewo k o assess banks' sus ainabili y
p ac ices and p og ams. Sec ion 3 p esen s he da a
and me hodology. Sec ion 4 p esen s he esul s and
discussion. The inal sec ion discusses he conclusion,
esea ch implica ions, and he limi a ions o he s udy.
II. Li e a u e Re iew
A. O e iew o Indonesian Banks in he
Ea ly Yea s o he COVID-19 Pandemic
In he Law o he Republic o Indonesia Numbe
10 o 1998 ega ding he banking sec o , a bank
is de ined as a business en i y ha collec s unds
om he public in he o m o sa ings and dis ibu es
hem o he public in he o m o c edi and/o o he
o ms o imp o e he s anda d o li ing o people.
A o dable c edi can encou age he necessa y
inno a ion and expansion in economic and inancial
inclusion o he poo (Musembi & Chun, 2020).
GLOBAL BUSINESS & FINANCE REVIEW, Volume. 29 Issue. 6 (JULY 2024), 31-46
34
A bank collec s public unds and hen dis ibu es
he unds o he public o enhance people's s anda d
o li ing. By channeling unds o people who a e
in need h ough he p o ision o c edi , especially
o he business wo ld, banks indi ec ly ha e a posi i e
in luence on he communi y. These in e media ion
ac i i ies ensu e sus ainable economic de elopmen
(Zachoso a, Babina, and Zano a 2018).
The ne e -ending pandemic has become a h ea
o he banking sec o . The banking sec o is he 'hea
o a smoo h blood low' o economic ac i i ies. Banks
play a signi ican ole as an in e media y ins i u ion
o he low o unds om he public in he o m
o sa ing and dis ibu ing hem o he public in he
o m o c edi . The e o e, i is impo an o main ain
public us o inc ease he in e media ion e iciency
o banks. Public us in banks is also needed because
banks do no ha e enough cash o pay hei obliga ions
o all hei cus ome s a once.
E o s and s a egies a e needed so ha banks
can be esilien in acing his pandemic. On he one
hand, he go e nmen has issued se e al policies o
s imula e he na ional economy, which has especially
helped he banking sec o o su i e du ing he
pandemic (Fa ihah and Ha adina a 2021). On he
o he hand, banks ha e also o mula ed s a egies
o deal wi h he pandemic. The COVID-19 pandemic
has changed many hings in he banking sys em. Fo
example, banks ace new beha io s o employees
and cus ome s; hence, hey mus adap o he new
challenge. The e o e, banks need o ebuild eliable
b ands because, in hese imes, cus ome s a e
su ounded by ea and ins abili y. Fu he mo e, banks
need o be mo e digi al and mo e in ol ed in
unde s anding cus ome needs.
B. Sus ainabili y P ac ices and P og ams in
Indonesian Banks
The concep o sus ainabili y in banks con inues
o e ol e. I s a ed wi h 'social banking,' which
includes philan h opy and communi y de elopmen
p og ams. Then, i de eloped in o 'e hical banking,'
which in eg a es business p ac ices and e hical
p ac ices in bank ope a ions, and 'g een banking,'
which p omo es en i onmen ally iendly p ac ices
in banking. The las is 'sus ainable banking,' which
in eg a es aspec s o ESG in banking ac i i ies o
achie e sus ainable goals. Thus, he concep o
sus ainable banking is an in eg a ion o social, e hical,
and g een banking (Webe and Fel ma e 2018).
In 2014, h ough he Financial Se ices Au ho i y
(OJK), Indonesia launched he Sus ainable Finance
Roadmap Phase I (2015-2019). Eigh banks a e
willing o be he i s mo e s in he implemen a ion
o his oadmap. The oadmap ocuses on he basic
amewo k o egula ion and epo ing sys ems;
inc easing unde s anding, knowledge, and compe ence
o human esou ces in he inancial se ices indus y;
p o iding incen i es; and coo dina ing wi h ele an
agencies. Howe e , he e a e s ill gaps in he oadmap,
such as he lack o indus y unde s anding o he
impo ance o sus ainabili y and he absence o
s anda diza ion o he p og am a he na ional le el.
Some o hese gaps mus be esol ed immedia ely
so ha he banking sec o can maximize i s
oppo uni ies o align wi h he inc easing ma ke
demand o sus ainable p oduc s and se ices.
U iliza ion o hese oppo uni ies mus be balanced
wi h isk managemen , especially isks ela ed o
clima e change. Clima e change isks can be ela ed
wi h he alue o companies (Pa k and Noh, 2017).
The bigges challenge in implemen ing sus ainabili y
is how o change he mindse o businessmen and
he communi y in op imizing long- e m p o i s by
in eg a ing ESG issues in o business ac i i ies
(Ha yan o and Budiman, 2016).
On July 18, 2017, he Financial Se ices Au ho i y
(OJK) issued egula ion No.51/POJK.03/2017 ega ding
he p o isions o implemen sus ainabili y o he
inancial indus y. I also aims o s eng hen he
Sus ainable Finance Roadmap Phase I launched by
OJK in 2014. I is hoped ha he exis ence o hese
egula ions can bind commi men s o banks o
implemen sus ainabili y in business ac i i ies.
To implemen sus ainable inance, banks a e
equi ed o p epa e a Sus ainable Finance Ac ion Plan
El a Fa ihah, Ok a Sindhu Ha adina a, Anidah Robani, Rahma Yuliawan
35
(RAKB). The RAKB mus be communica ed o
sha eholde s and s akeholde s a all le els o an
o ganiza ion. Banks a e equi ed o compile a sepa a e
sus ainabili y epo om hei annual epo o as
an in eg al pa o hei annual epo . The
sus ainabili y epo mus be published no la e han
Ap il 30 o he ollowing yea .
Nex , he Financial Se ices Au ho i y (OJK)
issued he Sus ainable Finance Roadmap Phase II
(2021-2025), which ocuses on accele a ing he
applica ion o ESG p inciples in Indonesia, inno a ion
o inancial p oduc s and se ices, as well as a na ional
campaign o sus ainabili y. Fu he mo e, banks a e
expec ed o epo on he p og ess o sus ainabili y
p ac ices and p og ams egula ly o he public. They
a e equi ed o ocus on c ea ing a comp ehensi e
sus ainable ecosys em by in ol ing all ele an pa ies
and encou aging he de elopmen o coope a ion wi h
o he pa ies. The Phase II oadmap is expec ed o
be a e e ence o banks o de elop sus ainabili y
p ac ices and p og ams. Fu he mo e, he exis ence
o sus ainabili y egula ions can inc ease banks'
awa eness o disclose and implemen hem.
C. F amewo k o Assess Banks' Sus ainabili y
P ac ices and P og ams
P e ious s udies ha e de eloped amewo ks o
assess sus ainable banking pe o mance comp ehensi ely.
Islam e al. (2016) de eloped a amewo k o assess
sus ainable banking pe o mance and applied i o
24 in e na ional banks sp ead ac oss ou coun ies
—
Aus alia, Japan, China, and India. Kuma and P akash
(2019) also de eloped a amewo k o e alua e
sus ainable banking pe o mance in India. Howe e ,
sus ainabili y p ac ices and p og ams in banks a e
highly dependen on he egion, le el o socio-
economic de elopmen , consume p e e ence, and
egula o y en i onmen (Maimbo and Zadek 2017).
The e o e, his s udy de elops a amewo k o assess
sus ainable banking pe o mance by elabo a ing on
he egula ion o he Financial Se ices Au ho i y
(OJK) and GRI guidelines o he banking sec o
in Indonesia. This amewo k was ca ied ou by
sco ing 40 indica o s in 5 g oups o sus ainabili y
p ac ices and p og ams, as p esen ed in Table 1.
Table 1 desc ibes sus ainabili y p ac ices and
p og ams in Indonesian banks. The i s g oup
desc ibes he a ailabili y o p oduc s and se ices
ha ocus on en i onmen al and social issues. The
second g oup desc ibes banks' conce n o en i -
onmen al aspec s h ough ini ia i es hey ake o adop
en i onmen al managemen . The hi d g oup e lec s
how banks ca y ou social esponsibili y o ealize
a sus ainable socie y. The ou h g oup e lec s how
banks main ain social and e hical s anda ds h ough
company policies, such as an i-co up ion policies,
No Sus ainable p ac ices and p og ams
G oup 1: Sus ainable p oduc s and se ices
1 Sus ainable inancing
2 Clima e und
3 En i onmen al loan
4 Mic o inance
5 Responsible in es men
6 G een mo gage
7 Sus ainable ad ocacy se ices
8 Financial inclusion p oduc
9 En i onmen ally sa ing p oduc s
10 G een bond
Table 1. Sus ainabili y banking pe o mance amewo k
GLOBAL BUSINESS & FINANCE REVIEW, Volume. 29 Issue. 6 (JULY 2024), 31-46
36
human igh s, and business e hics. I desc ibes he
in e nal eadiness o banks by issuing se e al policies
on ac i i ies ela ed o in e nal socio-e hical conduc .
Fu he mo e, he policy is used as a guideline so
ha he implemen a ion o sus ainable inance does
no go ou o he es ablished bounda y. The las g oup
e lec s he ex en o which a bank is commi ed
o a globally sus ainable code o conduc and engages
wi h all s akeholde s o disclose sus ainabili y
p ac ices and p og ams. The las g oup can also se e
No Sus ainable p ac ices and p og ams
G oup 2: Managemen commi men o en i onmen al aspec s
11 ISO 14001
12 Sec o -speci ic exclusion
13 En i onmen al isk managemen in lending policy
14 Quan i a i e in o ma ion abou en i onmen ca e ini ia i es
15 Adop ion o en i onmen ally iendly echnologies
G oup 3: Managemen commi men o social aspec s
16 Communi y in ol emen p og am
17 Cha i y and sponso ing
18 Financial li e acy and c edi counseling
19 T aining and skill de elopmen p og am
20 Communi y consul a ions
21 Ta ge s o communi y in es men
22 ISO 26000 ce i ica ion
23 Heal h ca e and sani a ion p og am
24 Access poin s o inancial se ices in low-popula ed o emo e a eas o he coun y
25 Imp o e access o inancial se ices o disad an aged people
G oup 4: In e nal socio-e hical policies
26 Policy and p ocedu e conce ning An i-co up ion
27 Policy and p ocedu e conce ning human igh s
28 Policy o business e hics/ alues
29 Labo p ac ices
30 Gende equi y and di e si y
G oup 5: Sus ainabili y code o conduc , epo ing, and ESG indexing
31 Sus ainabili y epo disclosu e
32 Business esponsibili y epo disclosu e
33 En i onmen policy
34 GRI s anda d
35 Sus ainable inance awa d
36 Adhe ence o UN Global Compac p inciples
37 Membe associa ion na ionally/in e na ionally (IKBI/WWF/UNEP FI)
38 Adhe ence o NVG disclosu e (coun y-speci ic guidelines)
39 Sus ainable Responsibili y Index (SRI) KEHATI
40 Dow Jones Sus ainabili y Index
Sou ce: (Financial Se ices Au ho i y (OJK) 2017) and (GRI 2014)
Table 1. Con inued
El a Fa ihah, Ok a Sindhu Ha adina a, Anidah Robani, Rahma Yuliawan
37
as a e e ence o assess banks' pa icipa ion in
p omo ing sus ainabili y and hei achie emen in
sus ainabili y pe o mance.
III. Me hodology
The Financial Se ices Au ho i y No. 51/POJK.03/
2017 equi ed comme cial banks lis ed on IDX o
implemen sus ainabili y by Janua y 1, 2019, which
is why his s udy ocuses on hem.
The au ho is also in e es ed in del ing deepe
on he e ec s o he COVID-19 pandemic on he
s ock exchange banking indus y, whe e banks a e
al eady subjec o educed and be e go e nance
o e sigh om he Financial Se ices Au ho i y.
Backg ound in o ma ion o his s udy comes om
Fa ihah and Ha adina a (2021) who s a e ha
Indonesia is a de eloping na ion and ha he
go e nmen has s imula ed he economy, pa icula ly
he banking sec o , h ough a numbe o policy
packages.
The popula ion o 45 banks was he s udy's sample.
The sample o his in es iga ion was 45 banks made
up he s udy's popula ion. Using pu posi e sampling,
he s udy's sample was chosen acco ding o he
ollowing s anda ds: Banks wi h no co po a e ac ion
in 2020 and 2021, as well as (1) banks lis ed on
IDX in 2020 and 2021. The e a e 42 banks' wo h
o samples based on hese s anda ds.
Seconda y da a om he banks' o icial websi es
is used in his analysis. The in o ma ion includes
annual epo s o 2020 and 2021 as well as
sus ainabili y. Addi ionally, a quan i a i e me hod is
used o assess he da a in wo s ages: con en analysis
and s a is ical analysis.
A. Con en Analysis
The i s s age o he analysis is con en analysis.
Con en analysis is used o measu e he alue o
he Sus ainable Banking Index (SBI) a iable, which
is used o assess he ex en o sus ainabili y adop ion.
Con en analysis is ca ied ou by quan i ying he
amoun o in o ma ion disclosed on he indica o o
he amewo k (Table 1). The keywo ds used in his
analysis a e de i ed om he 40 indica o s ou lined
in he amewo k. He e, a deep unde s anding is
needed o de ine each indica o o ob ain alid analysis
esul s. Con en analysis is ca ied ou as ollows:
(1) De e mining he weigh pe cen age o each
sus ainabili y p ac ice and p og am
Fo he con inuous pe o mance assessmen o be
alid and measu able, he weigh o each g oup is
needed. In his s udy, he weigh is adjus ed o
p io i ize sus ainabili y goals ha ha e been se by
he Financial Se ices Au ho i y (OJK). The i s
g oup, ha is, sus ainable p oduc s and se ices, is
an impo an a iable, so i is gi en a weigh o
40%. This is because he a ailabili y o sus ainable
p oduc s and se ices makes he bigges con ibu ion
o he ealiza ion o sus ainabili y in banks. The second
and hi d g oups a e gi en a weigh o 20% each,
while he ou h and i h g oups a e gi en a weigh
o 10% each.
(2) Finding he indica o by eading he sus ainabili y
epo and annual epo ca e ully
(3) Gi ing a sco e o each g oup
To assess he banks' pe o mance in sus ainabili y,
sco es a e alloca ed o each indica o in all g oups.
A maximum sco e o 20 is awa ded o each g oup.
Banks ha adop all sus ainabili y p ac ices and
p og ams on all 40 indica o s o he p oposed
amewo k can ob ain a maximum sco e o 100. In
G oups 1, 3, and 5, he e a e 10 indica o s o each
g oup; hence, he sco e o each indica o in hese
g oups is 2. In G oups 2 and 4, he e a e 5 indica o s
o each g oup, so a sco e o 4 can be assigned
o each indica o .
(4) Calcula ing he weigh ed sco e
The weigh ed sco e is ob ained by mul iplying
he weigh pe cen age (S ep 1) and he sco e in S ep 3.
(5) The o al sco e o each bank
The o al sco e is ob ained om he sum o he
weigh ed sco e in S ep 4. This o al sco e is called
GLOBAL BUSINESS & FINANCE REVIEW, Volume. 29 Issue. 6 (JULY 2024), 31-46
38
SBI. The maximum sco e o SBI is 20. The o al
sco e is hen di ided in o ou ca ego ies. The sco e
p esen s he le el o banks' pe o mance in
sus ainabili y p ac ices and p og ams (Table 2). This
app oach can se e as a guideline o he ex en o
which a bank's adop ion le el anges om insigni ican
o subs an ial adop ion.
B. S a is ical Analysis
A s a is ical analysis o he di e ence es
cons i u es he second analysis s ep. Using he SBI
a iable, a s a is ical es is conduc ed o de e mine
whe he he e was a di e ence in he sus ainable
banking pe o mance o Indonesian banks in 2020
and 2021. In his case, 2020 se es as a ansi ion
yea be o e he Sus ainable Finance Roadmap Phase
II is i s implemen ed in 2021. Howe e , he e a e
s ill issues wi h he s a egy, mos no ably he lack
o uni o m na ional le el p og ams and he indus y's
inadequa e unde s anding o he impo ance o
sus ainabili y. The Phase II oadmap in ends o assis
banks in de eloping sus ainabili y ac i i ies by ac ing
as a guide. Regula ions pe aining o sus ainabili y
can also s eng hen banks' adhe ence o hem in e ms
o disclosu e and implemen a ion. This analysis is
ca ied ou h ough a pai ed sample - es wi h a
signi icance o 5%. The hypo heses o his s udy
a e as ollows:
H0:
The e is no di e ence in he sus ainable
banking pe o mance o Indonesian banks in
2020 and 2021
H1:
The e is a di e ence in he sus ainable banking
pe o mance o Indonesian banks in 2020 and
2021.
IV. Resul s and Discussions
A. Analysis o Sus ainable Banking Pe o mance
in Indonesian Banks in 2020-2021
This sec ion p esen s he desc ip ion o sus ainable
banking pe o mance in Indonesian banks in 2020
and 2021. The ollowing explains he esul s based
on he assessmen amewo k (Table 1).
1. Sus ainable p oduc s and se ices
Figu e 1 compa es he sus ainable p oduc s and
se ices de elopmen o Indonesian banks in 2020
and 2021. The igu e depic s ha all banks p o ided
sus ainable banking p oduc s and se ices in he o m
o inancial inclusion p oduc s, sus ainable ad ocacy
se ices, mic o inance, and sus ainable inancing.
Only 5% o banks p o ided en i onmen al-sa ing
p oduc s in 2020 and 2021. In his s udy, he o m
o he en i onmen al sa ing p oduc s is was e sa ing
ha can be con e ed in o money. The numbe o
banks p o iding g een bonds, g een mo gages,
en i onmen al loans, and clima e unds inc eased in
2021, al hough he numbe is s ill e y small (below
50%). This is because he implemen a ion o
sus ainabili y in Indonesia in 2015 is s ill ela i ely
S age Sco e Adop ion Le el
1 0-5 Insigni ican adop ion (indica es he eluc ance o banks o adop sus ainable inance olun a ily)
26-10
Ea ly adop ion (indica es ha he bank is s a ing o adop in e nal en i onmen al managemen and
social esponsibili y)
3 11-15 Sa is ac o y adop ion (indica es ha he bank is ac i ely adop ing managemen p ac ices on
en i onmen al and social aspec s)
4 16-20 Subs an ial adop ion (indica es ha he bank unde s ands and inco po a es a ious aspec s o
sus ainabili y in o i s business, and hey play an impo an ole in p omo ing sus ainable de elopmen )
Sou ces: (Kuma & P akash 2019)
Table 2. Adop ion le el o sus ainabili y p ac ice and p og ams
El a Fa ihah, Ok a Sindhu Ha adina a, Anidah Robani, Rahma Yuliawan
45
ecei ed a highe anking.
This s udy sugges s o schola s ha each na ion
has a unique app oach o implemen ing sus ainable
banking as manda ed by i s legal amewo k. As a
esul , u u e s udies could modi y he amewo ks
o i he needs o pa icula na ions.
B. Limi a ions
This s udy is based on quan i ica ion o sus ainabili y
and annual epo s so he deg ee o sus ainable
banking pe o mance has no been aken in o
conside a ion. This s udy used 40 indica o s o
measu e sus ainable banking pe o mance. Fu u e
s udies can use mo e indica o s o sus ainable
banking. The indings may change o e ime.
The e o e, he longi udinal s udy can be a emp ed
in u u e esea ch o gi e mo e insigh in o sus ainable
banking pe o mance.
This pape ocuses on comme cial banks in
Indonesia, which is a de eloping coun y. The e o e,
u u e esea ch can es he di e ence in he
implemen a ion o sus ainable inance in de eloping
and de eloped coun ies du ing a pandemic. Las ly,
u u e esea ch may also ocus on conduc ing
longi udinal s udies o in es iga e he long- e m
impac o Indonesian banks' sus ainabili y p ac ices
and p og ams implemen ed du ing he COVID-19
pandemic. This may include acking key sus ainabili y
indica o s o e ime, analyzing ends and pa e ns
in sus ainabili y pe o mance, and e alua ing he
las ing e ec s o banks' sus ainabili y ini ia i es on
en i onmen al, social, and inancial ou comes beyond
he immedia e c isis pe iod.
Acknowledgmen s
The au ho s would like o exp ess g a i ude o
The Ins i u e o Inno a ion, Jou nal De elopmen ,
Publishing and In ellec ual P ope y Righ s (LIPJPHKI)
Uni e si as Ai langga as he e hics commi ee. The
au ho s would like o hank ep esen a i es o
academics, p ac i ione s, egula o s, and associa ions
who ha e suppo ed he comple ion o his esea ch.
The au ho s also would like o ex end app ecia ion
o D . Anidah Robani om he Ins i u e o Technology
Managemen and En ep eneu ship, Uni e si i Teknikal
Malaysia Melaka (UTeM), Melaka, Malaysia o he
assis ance in comple ing his publica ion.
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