Implementation of Sustainability-Oriented Accounting and Integrated Reporting in State-Owned Enterprises in the Construction Sector

Abstract

This research aims to analyze the implementation of Sustainability-Oriented Accounting (SOA) and Integrated Reporting (IR) in state-owned enterprises (SOEs) within the construction sector in Indonesia. A descriptive qualitative approach was used, utilizing literature study and content analysis of annual reports and sustainability reports of state-owned construction companies. The results indicate that while the implementation of SOA and IR in state-owned construction enterprises has progressed significantly, companies still face substantial challenges in integrating Environmental, Social, and Governance (ESG) aspects directly into core accounting systems. The primary challenges include a lack of standardized non-financial value metrics, limited quantitative data regarding environmental impacts, and high transition costs toward fully integrated reporting. Although IR adoption enhances corporate transparency and accountability, the presentation of future value creation requires further refinement. The implications highlight the necessity of stricter technical regulations from the Ministry of SOEs and the Financial Services Authority (OJK) to promote standardized and measurable sustainability disclosures.