BPI Danantara as A Hybrid Entity in Indonesian Economic Law

Abstract

Danantara, Indonesia’s newly established sovereign wealth investment institution, is designed to consolidate and optimize state assets while operating with corporate efficiency. Its hybrid public–corporate character makes the governance question urgent: it must enable investment discretion without weakening public accountability, transparency, and anti-corruption safeguards. This article employs a normative juridical method using secondary legal materials, combining statutory and conceptual approaches. The study examines the principal legislation and implementing regulations establishing Danantara and situates them within doctrines on sovereign wealth fund governance, good corporate governance, and the business judgment rule. The analysis shows that the framework grants wide managerial powers and a corporate-style governance structure, yet leaves accountability vulnerabilities, including unclear public-official status of managers, discretionary oversight provisions, and exposure to political influence over business decisions. The article concludes that Danantara’s legitimacy and performance depend on mandatory oversight rules, arm’s-length decision-making, transparent investment audit trails for major transactions, robust conflict-of-interest controls, independent audit access, and merit-based appointments, so prudent risk-taking is protected while impunity is prevented.