Petronas and Pertamina face removal from US banking giant’s ESG index

Dateline 2021-06-18, Upstream Online:

Asian national oil companies Petronas of Malaysia and Indonesia counterpart Pertamina are on a watchlist for removal from JP Morgan’s Environmental, Social & Governance (ESG) Emerging Market Bond Index at the end of June.

The US bank said both state-owned players “are expected to exit the ESG suite at the June month-end rebalance” as their scores fell below the required threshold for inclusion.

The bank uses third party companies to assess the ESG score required for inclusion in the index. Sustainalytics, one of these companies, said some of Petronas’ or its affiliates’ activities in “high-risk regions” could be viewed as a violation of a United Nations arms embargo, reported Reuters, citing the bank’s statement.

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