In today’s business landscape, the implementation of Environmental, Social, and Governance (ESG) principles has become an integral part of corporate strategy to achieve long-term sustainability and create value that extends beyond financial returns. The ESG framework encourages companies to consider the holistic impact of their operations on the environment, society, and Good Corporate Governance. Among the three ESG pillars, the Social (S) aspect holds equally crucial importance, reflecting how a company manages its relationships and impact across various stakeholders—both internal and external—ranging from employees, customers, and communities to other stakeholders. One manifestation of the social aspect is realized through a commitment to upholding Human Rights, which serves as the foundation for fostering a mutually respectful work environment and building trust among all stakeholders.

 

In Indonesia, Human Rights, as defined by Presidential Regulation No. 60 of 2023 concerning the National Strategy on Business and Human Rights (Stranas BHAM), can be understood as a set of rights inherent to the nature and existence of human beings as creatures of God Almighty and as His gift, which must be respected, upheld, and protected by the state, the law, the government, and every individual, for the honor and protection of human dignity and worth.

 

The International Labour Organization (ILO) has also established fundamental principles and rights at work, as set out at https://www.ilo.org/topics-and-sectors/fundamental-principles-and-rights-work, namely: freedom of association and the effective recognition of collective bargaining, the elimination of forced labor, the abolition of child labor, the elimination of discrimination in employment, and a safe and healthy working environment.

 

The implementation of Human Rights in a manner that is appropriate, proportionate, and authentic serves as a strategic catalyst for long-term corporate value creation, particularly for entities that have attained public listed status. The approach to applying Human Rights is not merely a matter of fulfilling regulatory obligations, but is regarded as an instrument for value creation and the strengthening of stakeholder trust. To this end, it must be integrated comprehensively, both within the company’s internal environment and throughout the value chain. Such implementation demands the active involvement of all organizational functions and is realized through transparent reporting that is integrated into the company’s annual report and sustainability report.

 

Within the context of an ever-evolving global investment landscape—particularly for companies oriented toward the Environmental, Social, and Governance (ESG) framework—there is a growing demand for a strong and verifiable Human Rights track record. The authentic implementation of Human Rights reflects the maturity of a company’s risk management while minimizing exposure to potential legal sanctions, litigation, and reputational damage that could significantly diminish share value. Furthermore, a genuine commitment to Human Rights opens broader access to sustainable investment flows, holds the potential to lower the cost of capital, and enhances the company’s overall valuation in the eyes of the capital market.

 

An important consideration in the application of Human Rights is the avoidance of social washing. Social washing can be likened to the practice of “greenwashing” in the environmental domain, with the fundamental difference being its focus on social and Human Rights issues. Its scope includes, but is not limited to, the fulfillment of workers’ rights, respect for the rights of indigenous communities, the enforcement of non-discrimination principles, the protection of privacy, and the assurance of fair and dignified working conditions. The practice of social washing not only risks significant reputational harm but also erodes stakeholder trust and, ultimately, may have an adverse impact on the sustainability of corporate value over the long term.

 

In the conviction that sustainable business creates value for all stakeholders, the proper application of Human Rights has become a catalyst for sustainable growth. It is no longer a choice, but a necessity for public companies that aspire to be resilient, respected, and successful in the future.

 

Discover our commitment to Human Rights at https://www.bca.co.id/en/tentang-bca/sustainability/social/hak-asasi-manusia and explore our information disclosure in the 2025 Sustainability Report at https://pustaka.bca.co.id/ESG/2026/File/20260212-SR25-BCA-EN.pdf

 

Source: compiled from various sources.