Introduction

Stepping into 2025 means we only have less than five years left to achieve the ambitious targets of the SDGs. With so many uncertainties, a question remains: Can we really meet these goals or will we fall short doing so, thus leaving humanity to face the consequences of inaction?

To recapitulate, the world is drastically off course in achieving the 2030 target. Indonesia is partly responsible as well—its economic growth rate has consistently fallen short of its targets in recent years, signalling an urgent need for government intervention.

Meanwhile, programmes aimed at climate change mitigation remain underperforming, resulting in no significant reduction in carbon emissions. If this trend persists, it threatens to deepen the sustainability gap, jeopardising the country’s future and the wellbeing of its people.

From Financing to Reporting

Public finance for climate adaptation is crucial to help Indonesia attain these targets. There is a growing need for this, considering developing countries fall far behind their developed counterparts in financing climate adaptation (the financing gap between them is estimated at US$194–366 billion per year globally). Such a large sum of money for specific projects calls for robust financial mechanisms for monitoring and regulation.

The lack of transparency has sparked rising public concern over the accountability of these funds, especially as cases of misuse and deceptive practices – commonly referred to as “sustainability-washing” – continue to emerge.

Indonesia’s own Badan Pemeriksa Keuangan (Supreme Audit Institution – SAI) has identified weaknesses in the planning and accountability of the management of grants from the Forest Carbon Partnership Facility-Carbon Fund and the BioCarbon Fund Integrated Sustainable Forest Landscape. These deficiencies pose risks of potential fraud and hinder the achievement of carbon reduction targets.

In response to such a challenge, disclosure standards for sustainability-related funds have begun to emerge, such as Disclosure of Sustainability-related Financial Information (IFRS S1) and Climate-related Disclosures (IFRS S2).

Reimagining the Triple Bottom Line

The introduction of IFRS S1 and S2 signals the private sector to disclose sustainability-related information in their financial report. The implementation of sustainability reporting is rooted in John Elkington’s concept of the Triple Bottom Line (TBL), an approach that evaluates a private company’s performance through three interconnected pillars: Profit, Planet and People (3P).

It maintains that a company’s success should no longer be judged solely by its financial performance but also by its commitment to environmental sustainability and societal wellbeing. This shift drives private entities to actively engage in sustainable practices and transparently report on their efforts.

The International Public Sector Accounting Standards (IPSAS) followed suit shortly, adapting the TBL to fit into the public sector. In fact, the IPSAS Board has announced plans to release exposure drafts of these adapted standards as early as 2025. In this quick timeframe, the public sector must now be ready to incorporate sustainability concepts into their financial reporting.

However, the TBL framework seems insufficient to drive sustainability disclosures in the public sector. Governments, being non-profit-oriented entities, may see limited relevance or impact from such disclosures. There is even a risk that governments might produce incomplete or purely formalistic sustainability reports, simply to meet compliance requirements. This limitation led us to propose a reimagined TBL concept for the public sector: Politics, Planet and People.

Why “Politics”?

“Politics” is the more fitting principle for government sustainability reporting as governments, ideally, do not operate to maximise profits but to deliver direct societal benefits. A government’s primary functions are providing goods and services, ensuring geopolitical stability, maintaining social welfare, protecting the environment, as well as crafting policies to achieve the SDGs. It can direct resources, influence behaviour, and establish frameworks for sustainable practices across sectors through policies and legislation.

Slightly different from the private sector, a government’s sustainability disclosure will focus on the impact of the policies made. These policies must be inspired by sustainability values ​​so that achievement metrics can be implemented, as has been done by the City of Toronto, Canada. It should be noted that these sustainability-oriented policies are a product of political negotiation, a standard procedure in any policymaking process.

The Need for Accountability and Transparency

Given a government’s ability to pursue the SDGs through public programmes, there is a demand from the citizens regarding the state’s accountability on this matter, particularly concerning impacts on the environmental and social wellbeing fronts. Transparent sustainability reporting – grounded in the reimagined TBL – can strengthen public trust by demonstrating tangible commitments and measurable outcomes.

By incorporating a political lens into sustainability reporting, states can be encouraged to develop more actionable and concrete policies, directly advancing the effort to achieve the SDGs. Such reporting frameworks provide a clearer roadmap for progress, ensuring that governments are held accountable for their commitments and their use of public resources.

Indonesia’s SAI, for example, has been consistently issuing sustainability reports since 2020, the latest of which was released in 2023. This crucial step is an implementation of one of the International Organization of Supreme Audit Institution’s (INTOSAI) agreements regarding the SDG audit. The objective is to become a model organisation for other government institutions through the implementation of transparent and sustainable governance, which actively considers economic, social, and environmental sustainability aspects.

From the regional perspective, ASEAN has taken steps by forming the ASEAN Catalytic Green Finance (ACGF) instrument. This initiative seeks to accelerate green infrastructure investments in Southeast Asia by providing technical support and access to financing. To be eligible for financing, projects must be sovereign or sovereign-guaranteed and meet principal criteria, including clear government environmental priorities and goals, financial sustainability plans, as well as green investment roadmaps. Addititionally, an approval from the Asian Development Bank (ADB) is also required. Indonesia, for example, went through the assessment process by the ADB in 2023 before receiving financial support from the ACGF.

This approach ensures that projects should not only align with broad sustainability objectives but also provide the accountability and transparent aspects in their implementation before getting the loans. It highlights the importance of aligning coherent regulations, sustainable development plans, funding schemes and reporting altogether in order to reinforce public trust, drive meaningful progress, and produce benefits in multiple dimensions.

Policymaking for Sustainability

The adoption of the “Politics” element could have a significant influence on long-term political stability, public welfare and more inclusive sustainable development. Governments can start by integrating sustainability as a key indicator in budget and performance measurement across agencies. This approach can then be translated into more implementable measures, from setting carbon emission parameters in vehicle procurement, minimising paper documentation through the adoption of e-government, implementing a water recycling system in offices, to undertaking waste management activities. Furthermore, the monitoring and evaluation process should be applied consistently from the decision-making level to day-to-day operations as a substantive tool for improvement.

Cross-sectoral collaboration between the governments, the private sector and non-profit groups is crucial to harmonise the definition of sustainability and concrete actions. Taking this step, the governments could ensure that the metrics utilised in sustainability reporting are not only coherent across agencies, but also represent the aspirations and contributions of all parties.

Conclusion

Incorporating sustainability reporting into governance is more than just an administrative duty; it is a critical tool to improve accountability, transparency and national growth. The adoption of the Politics, Planet and People framework in SDG-related policies allows governments to focus more on strengthening public trust and enforcing systematic change. This hopefully establishes a new ideal political benchmark, where leaders are judged by concrete, long-term factors rather than short-term populism.

Political accountability based on the SDGs also produces a positive domino effect. Increased public expectations toward measurable sustainability outcomes enhance the likelihood of both elected and appointed officials to embrace responsible, forward-thinking leadership. The race to meet the public expectations creates significant political transformation, fostering healthier, more resilient governments and communities. At the end of the day, sustainability is not solely a governmental aim but also a mutual priority, enforcing systematic social and economic change. The reimagined TBL has the potential to redefine governance and development, making sustainability a cornerstone of political and social advancement for generations to come.r