Indonesia's Exchange to Tighten Rules on Concentrated Stock Holdings

Indonesia Stock Exchange (IDX) officials have announced plans to revise the methodology governing its primary equity indices by removing stocks with excessive concentration among individual shareholders. The policy change addresses concerns that companies with dominant ownership structures may pose liquidity risks and fail to meet the transparency standards expected of benchmark constituents.

Under the revised framework, stocks where a single shareholder or related parties hold a disproportionately large stake will be excluded from the exchange's key indices. Exchange officials cited the need to maintain index integrity and protect investor interests as primary drivers behind the regulatory adjustment.

The move reflects growing regional focus on corporate governance standards and market quality across Southeast Asian exchanges. Similar concentration-related restrictions have been implemented by peer exchanges as part of broader efforts to create more liquid, representative benchmark indices.

IDX said it would provide a transition period for affected companies to adjust their shareholding structures before full implementation of the new rules. Further details regarding specific concentration thresholds and implementation timelines are expected to be announced during stakeholder consultation meetings scheduled for coming weeks.