Green Restructuring or Transition-Washing?

The AlamTri Resources Indonesia Paradox

Abstract

Our study investigated the discrepancy between corporate sustainability narratives and operational realities within the Indonesian extractive industry, focusing on the strategic restructuring and rebranding of a major coal entity. We aimed to evaluate whether asset spin-offs and "green" rebranding effectively facilitated a genuine energy transition or served as defensive impression-management mechanisms. Our study contributes by extending the legitimacy trap concept from a local socio-political defense mechanism into a multi-scalar Environmental, Social, and Governance (ESG) setting. Employing a qualitative case study approach with interactive data analysis, we examined environmental, social, and financial performance metrics from 2022 to 2024. The findings suggest a notable gap between the company’s transition narrative and several reported operational indicators. Despite securing the highest domestic environmental awards, the entity's absolute greenhouse gas emissions and hazardous waste production continued to increase. We also noted a decline in social investment and new employee recruitment, indicating a neglect of the just transition principle. Crucially, we found that domestic administrative legitimacy may not have been sufficient to shield the company against global market pressures, as evidenced by the entity’s inclusion in international exclusion lists and the termination of strategic commercial contracts by global off-takers. We concluded that such "perception engineering" created a legitimacy trap, in which local compliance proved insufficient to mitigate global financial delegitimation. Our findings emphasized the urgent need for absolute decarbonization metrics over procedural administrative reporting. Moreover, domestic regulatory approval can accelerate rather than prevent international capital exclusion.