Legal Certainty of Sustainable Finance Provisions in Relation to Corporate Social Responsibility (CSR) Programs at Financial Services Institutions

Corporate Social Responsibility (CSR) has become an essential element in the operations of companies, particularly financial service institutions, in line with the growing attention to the concept of sustainable finance. This research is motivated by the legal uncertainty in implementing sustainable finance linked to CSR programs, which often face issues such as inconsistent definitions, unclear sanctions, and non-standardized reporting mechanisms across various regulations. The objective of this study is to analyze the regulation of sustainable finance in relation to CSR and evaluate the legal certainty embedded in its implementation by financial service institutions. This study employs a juridical-normative method with an analytical approach to legislation, official documents, and case studies in several companies within the financial services industry. The results indicate that the regulations on sustainable finance and CSR in Indonesia still face several challenges. Law No. 40 of 2007 on Limited Liability Companies regulates CSR obligations generally but does not impose specific sanctions. Meanwhile, Law No. 25 of 2007 on Investment provides for administrative sanctions but lacks clear enforcement mechanisms. Additionally, the Financial Services Authority Regulation (POJK) No. 51/POJK.03/2017 mandates financial service institutions to develop sustainability action plans and sustainability reports, but its implementation is limited to certain sectors without addressing inclusivity. Existing regulations also fail to optimally provide tax incentives that can encourage consistent CSR implementation by businesses. The conclusion of this study highlights the need for regulatory harmonization to create legal certainty that supports the implementation of sustainable finance and CSR. This includes aligning definitions, strengthening reporting mechanisms, establishing clear sanctions, and improving oversight. With legal certainty, financial service institutions can be more confident in investing in sustainability projects and executing CSR programs that positively impact society, the environment, and business continuity. This research aims to serve as a reference for policymakers and companies in promoting inclusive social and economic development.