Mandiri 2022

Abstract

For more than two decades since its founding in 1998, Mandiri has been relying their financing business on the dirty industries that are being promoted to enhance the Indonesian economy. Such industries are palm oil plantation and coal mines that are being scrutinized as the culprit of many environmental and social issues. Banks such as Mandiri without a doubt contribute to the growth and spread of such business by financing extensive capital needed for expansion. However, as the environmental awareness increased there has been demand lately for a more sustainable financial institution. Customers are no longer solely focusing on profit, as well as banks including Mandiri started to realize that climate change will be the number one risk in the next five years. While, the government and related institution are also preparing to implement the concept of carbon credit and carbon tax in Indonesia in the near future. To mitigate climate risk, many initiatives are being created by banks including Mandiri. Mandiri has been reducing their electricity, fuel, and water input. As well as installing energy saving instruments in their building such as solar panel, heat reflecting glass to reduce AC usage, bicycle parking, and timers for electronic appliances. Furthermore, in their financial activities Mandiri launched and created their first green bond in Indonesia which would solely financing green projects in Indonesia such as wind turbine electric generator. However, with the current customer’s preferences of sustainable banking and Mandiri’s pace to change their operation this case will elaborate on how they are responding to the new challenge.

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