BSI Scholarship and Sustainability Launch - Resident Coordinator's Speech, Gita Sabharwal

Bapak Professor Kyai Haji Noor Achmad, Chairman, BAZNAS
Bapak Professor Muhammad Najib, Director of Institutional Affairs, Directorate General of Higher Education, Ministry of Higher Education, Science and Technology of Republic of Indonesia
Bapak Anggoro Eko Cahyo, President Director, PT Bank Syariah Indonesia
BSI Board of Commissioners, Sharia Supervisory Board and the Board of Directors
Bapak Professor Heri Hermansyah, Chancellor of University of Indonesia
Sir/Madam Chancellors of Universities in Jabodetabek Area, or their representatives

Let me begin by congratulating BSI for having formally joined the UN’s Principles for Responsible Banking to accelerate the sustainable transition for people and the planet. As a signatory to the PRB, BSI has joined the global banking industry committed to sustainable financing by aligning its strategy, lending and investment operations in support of ESG. As the country’s largest Islamic bank, with an asset base of $25 billion, BSI is a model for Islamic banks in Indonesia and with time, it will be so globally as well.

BSI demonstrates that social responsibility and responsible banking can go hand in hand in support of the country’s transformative agenda. Its ESG-related investments speak for themselves. Last year, nearly a fourth of its portfolio supported sustainable financing, accounting for $4 billion. This includes lending and investments in renewables, sustainable transport and wastewater management.

Just as importantly, BSI is supporting MSMEs to expand markets and jobs while supporting bottom lines. Nationally, only one in five MSMEs have access to credit and BSI is contributing to a drive to raise this ratio to one in four within the next five years.

The bank has also leveraged corporate Zakat to fund a range of SDG-aligned social initiatives, including this scholarships program being launched today. As many as 5,000 students from the top ten universities will benefit, enabling them to live up to their fullest academic potential. These investments in the future of Indonesia are aligned with the President’s vision for robust human capital development premised on a high growth trajectory.

BSI’s pioneering role in issuing Indonesia’s first corporate ESG sukuk, valued at $180 million and oversubscribed three times – deserves strong commendation. The proceeds will support green and social projects aligned with international standards. The bank will leverage these sukuks to provide tailored MSME financing to advance ESG objectives. This is especially critical, as MSMEs form the backbone of Indonesia’s economy and supply chains. To make the green transition a reality, it must start with MSMEs.

In a fiscally strained climate, banks such as BSI are critical for ensuring the long-term sustainable financing of the country’s environmental and social transitions. BSI is among the five national banks that, in partnership with UNEP FI, are developing sustainable financing plans to scale up ESG investments. The technical assistance from UNEP FI supports fine-tuning the ESG roadmaps to set out the pathway to match the level of ambition for Indonesia’s green transformation.

Together, every percentage point increase in ESG investments by these banks translates into an additional $1.23 billion for green growth. This is the scale of capital that needs to be unlocked for sustainability.

We, as the United Nations, applaud you, and hope to see more deserving young people securing scholarships over the years through your corporate Zakat. BSI are truly living up to the motto of being a financial, social, and spiritual partner for Indonesians, embodying Islamic values at the heart of finance.

The bank’s commitment to uphold Maqasid Sharia – promoting social welfare, justice and environmental stewardship – demonstrate how Islamic law and Islamic finance principles can guide transformative and inclusive development for Indonesia. Terima Kasih.