On 21st August, we successfully held Trihitalks #5 – Preparing for PSPK 2: Climate Risk Assessment and Disclosure for Companies in Indonesia. Verena Streitferdt, our Senior Consultant and Head of the Carbon Management Team, opened the online sharing session by addressing the urgency behind PSPK 2. Climate-related losses projected in Indonesia could reach up to IDR 2,500 trillion by 2029. This was also marked by how frequently climate disasters are already occurring. Furthermore, she clarified how PSPK 2 exists to help entities identify and respond to the climate-related risks and opportunities that shape their prospects going forward.
Taking the conversation deeper into the disclosure structure, Fitria Aurora Feliciani, Climate Risk and Sustainability Consultant, walked through how PSPK 2 is built around governance and risk management structures. On governance, larger companies are increasingly forming executive boards for climate oversight, supported by steering committees and working groups that draw in departments such as ESG, HSE, Operations, and Finance. Meanwhile, on the risk management side, this means fully adopting IFRS S2, including the obligation to disclose risk identification across the value chain, covering both physical risk and transition risk.
Ingo Hauter, Disclosure Strategy & Solutions at Nawasena Inninawa Nusantara, added his financial perspective that the cost of climate and environmental risk can end up 159 times higher than the cost of mitigating it, which means an early investment in mitigation can give companies huge direct advantages. He also presented five critical actions to establish a financial resilience strategy that is better prepared for upcoming challenges:
- Conducting climate scenario stress tests using two to three scenarios.
- Integrating scenario analysis results in capital and credit-related decisions.
- Setting emission reduction targets and business transition plans based on scenario analysis.
- Maintaining transparency in disclosures to build credibility.
- Periodically monitoring key indicators and updating analyses as regulations and policies evolve.
Closing with a global outlook, Rebecca Self, Co-Founder & Managing Director at Seawolf Sustainability Consulting, shared that nearly 40 jurisdictions, representing around 60% of global GDP and 60% of global GHG emissions, have already adopted or are moving toward ISSB Standards. She also highlighted that disclosure goes beyond stating targets, it also means being transparent about how those targets are set, reviewed, and measured against actual performance.
With the implementation of PSPK 2 approaches, early organisational preparedness is undeniably the vital factor. Companies that move earlier to identify their climate risks and opportunities will find it easier to turn disclosure into a strategic advantage for enduring business stability in the years ahead.
So, where does your organisation stand today?
