BARITO RENEWABLE ENERGY (BREN) AND THE FTSE INDEX: A CASE STUDY ON GLOBAL CLIMATE FINANCE'S DIRECTION

Abstract

The exclusion of Barito Renewables Energy (BREN), Indonesia's largest renewable energy company, from the FTSE Global All Cap Index has highlighted critical gaps in global climate finance and the role of index providers in shaping investment flows. This exclusion resulted in significant market volatility, reflecting the influence of major index providers like FTSE Russell, MSCI, and S&P Dow Jones on emerging markets. BREN's focus on geothermal energy underscores its importance in Indonesia's renewable energy transition, contributing to nearly 40% of the national renewable energy targets. However, the lack of transparency in FTSE’s exclusion criteria raises concerns about equitable access to global finance for developing nations. This paper explores the implications of BREN’s exclusion, the broader issues in ESG investment, and the potential for a revised anthropocentric International Relations theory to drive sustainable economic growth in Indonesia. The study employs a qualitative research methodology, drawing on primary data from Bursa Efek Indonesia (BEI), FTSE Russell, and PT Barito Renewables Energy Tbk (BREN), as well as secondary data from financial reports, media analysis, and market research. The findings reveal the inconsistencies in FTSE’s screening process, raising questions about transparency and the potential for arbitrary decision-making that disproportionately affects emerging markets. Additionally, the exclusion underscores the broader misalignment between global index criteria and the sustainability efforts of developing nations.

Key words: Barito Renewables Energy (BREN), FTSE Global All Cap Index, global climate finance, Indonesia clean energy, index providers.