ESG News | September 2024 Round-Up

As we settle into October, it is time to look back at some of the big ESG news stories and events from September. We have collated and summarised stories from Malaysia and worldwide that impact ESG and businesses as they strive to be more sustainable.

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Local ESG News

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Malaysia Achieves 43% SDG Performance, Surpassing Expectations

Malaysia's strong economic growth has led to a review of the nation's progress toward the United Nations' 2030 Sustainable Development Goals (SDGs). The review shows that the country has achieved significant progress, surpassing expectations with a 43% performance rate, well above the initial 17% target. The achievement highlights the country's efforts in areas like poverty reduction, clean energy, and quality education.

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Deputy Minister of Economy Hanifah Hajar Taib noted that this success demonstrates Malaysia’s commitment to sustainable growth. As the 2030 SDG deadline approaches, further improvements are under review to keep pace with global standards, focusing on inclusive growth and environmental conservation while driving further economic development.

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Phased Implementation of Malaysia's NSRF

Malaysia's National Sustainability Reporting Framework (NSRF) will be rolled out in phases, as announced by the Ministry of Finance. The framework aims to enhance corporate transparency and accountability in sustainability practices across various sectors. By implementing the NSRF gradually, the government intends to provide businesses with sufficient time and resources to adapt to the new reporting requirements, ensuring a smoother transition towards sustainable practices.

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The phased approach allows businesses, especially small and medium enterprises (SMEs), to integrate sustainability reporting into their operations gradually. This strategy aims to build capacity within organisations to meet the growing demand for sustainability disclosures. The government believes that by fostering a culture of transparency, Malaysia can strengthen its position as a leader in sustainable development in the region.

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Local Firms Urged to Go Green or Face Export Ban

In light of increasing global environmental regulations, local Malaysian firms are urged to adopt greener practices or risk export bans. The Ministry of International Trade and Industry emphasised that compliance with sustainability standards is essential for maintaining access to international markets. Companies are encouraged to invest in sustainable technologies and practices to meet these evolving standards.

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The call to action comes as the government seeks to position Malaysia as a responsible exporter committed to environmental sustainability. Failure to comply could result in significant economic consequences, highlighting the urgent need for businesses to prioritise sustainability in their operations. By adopting green practices, firms enhance their market competitiveness and contribute positively to the global fight against climate change.

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Environment Deptartment May Use Collected Fines to Improve Resources Operations

The Malaysian Department of Environment is considering utilising some of the fines collected from environmental violations to enhance its operational resources. This initiative aims to bolster the department's capacity to monitor and enforce environmental regulations more effectively. By reallocating these funds, the department hopes to improve its capabilities in addressing environmental issues and promoting industry compliance.

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This approach underscores the government's commitment to maintaining environmental integrity while ensuring violators are held accountable. The revenue generated from fines could be invested in advanced monitoring technologies and training programs, enabling the department to respond more proactively to environmental challenges. This initiative reflects a broader effort to strengthen Malaysia's ecological governance and protect its natural resources.

Malaysia Calls for Stronger Global Cooperation at UN Summit for the Future

During the UN Summit for the Future, Malaysia emphasised the need for enhanced global cooperation to tackle pressing issues such as climate change, poverty, and inequality. Malaysian representatives called for collaborative efforts among nations to implement sustainable development goals effectively. They highlighted that collective action is essential to address challenges that transcend national borders and require unified responses.

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Malaysian officials pointed out that stronger partnerships among governments, the private sector, and civil society are crucial for fostering resilience and sustainable growth. The summit served as a platform for Malaysia to advocate for a more equitable and sustainable world, underlining its commitment to global efforts to achieve the United Nations' Sustainable Development Goals (SDGs).

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Bursa Carbon Exchange Begins Continuous Trading of RECs

Bursa Malaysia has introduced continuous trading of Renewable Energy Certificates (RECs) on its carbon exchange platform. This marks a critical step toward promoting renewable energy in Malaysia and providing businesses with easier access to green energy solutions.

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The continuous REC trading system allows for a more flexible and transparent process, enabling companies to meet their sustainability targets more efficiently while contributing to global carbon reduction efforts.

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CGS’s New Financing Initiative Promotes Sustainability

CGS-CIMB Securities has launched a new sustainability-focused financing initiative, promoting green investments and responsible financing. The program aims to help companies adopt more environmentally friendly practices by offering financing tied to ESG benchmarks.

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The initiative is part of CGS-CIMB's broader efforts to drive sustainability in the financial sector, aligning with Malaysia’s national goals for greener economic development and corporate responsibility.

Pos Malaysia Targets Fully Electric Fleet by 2030

Pos Malaysia aims to have a fully electric fleet by 2030 as part of its sustainability strategy. The postal company is gradually transitioning from fuel-powered vehicles to electric ones, reducing carbon emissions and contributing to the country's environmental goals.

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This initiative will play a vital role in Pos Malaysia's efforts to modernise its operations, improve energy efficiency, and align with Malaysia's net-zero carbon emission targets.

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Sarawak’s Annual Sustainability Report

Sarawak will launch its annual Sustainability Reporting Green Initiatives to track progress on environmental goals and raise accountability among businesses. This initiative aligns with global trends toward transparency in sustainability efforts and reinforces Sarawak’s commitment to environmental stewardship.

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Sarawak Premier Tan Sri Abang Johari Openg highlighted that this report will encourage companies to adopt sustainable practices while providing a benchmark for future green initiatives.

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Digital Minister Urges Businesses to Adopt AI Technology

Malaysia’s Digital Communications Minister, Gobind Singh Deo, discussed how technological progress, particularly in digital innovations, is helping businesses tackle economic and environmental challenges by creating jobs and promoting energy efficiency.

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The Digital Ministry has aligned with Goal 9 of the UN’s Sustainable Development Goals by fostering innovation and infrastructure. A recent Memorandum of Cooperation (MoC) between MyDIGITAL and Bursa Malaysia highlights efforts to advance ESG initiatives through knowledge-sharing, digital tools, and the Malaysia Centre4IR ESG Innovation Challenge. This challenge aims to empower corporations to drive sustainable transformation, with pilot projects set to launch in 2024.

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MyDigital Corporation and Bursa Malaysia signed the MoC to boost digital transformation in Malaysia's capital market. The partnership aims to enhance innovation and data-driven decision-making, improving efficiency and transparency. Both entities seek to better align with Fourth Industrial Revolution (IR4.0) trends and global standards by integrating digital tools.

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This collaboration will help create a robust ecosystem that supports capital market players, providing them with advanced digital platforms for trading, analysis, and compliance.

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Malaysia to Lead ASEAN Clean Energy Transition in 2025

Malaysia is poised to lead ASEAN's clean energy transition as the regional chair in 2025. Deputy Prime Minister Datuk Seri Fadillah Yusof announced the country’s commitment to accelerating the adoption of renewable energy and reducing carbon emissions. He emphasised regional initiatives like the ASEAN Power Grid and Trans-ASEAN Gas Pipeline as crucial in promoting energy integration.

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Fadillah also reaffirmed Malaysia’s goal to increase its renewable energy capacity to 70% by 2050 through investments in solar, hydropower, and other green technologies.

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SC Explores Maqasid Al-Shariah Principles for Social Governance

The Securities Commission Malaysia (SC) is exploring integrating Maqasid Al-Shariah principles to enhance social governance practices for businesses. These principles focus on social welfare, justice, and ethical governance to create a more inclusive and responsible corporate culture. The initiative is part of Malaysia's broader efforts to incorporate Islamic values into its financial and governance frameworks.

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This approach could better align ESG (Environmental, Social, and Governance) goals and Islamic financial principles, potentially setting a global example for Shariah-compliant ESG practices.

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Companies Missing Opportunities Due to Lack of Scope 3 Disclosures

Many companies are failing to disclose their Scope 3 emissions, which cover indirect emissions from supply chains and consumer use, leading to missed opportunities in sustainability leadership. According to experts KPMG and PBEC, in their recently launched report, ‘Unlocking the Scope 3 opportunity in Asia Pacific’, addressing Scope 3 is crucial for meaningful progress towards carbon neutrality, as it accounts for many total emissions.

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Companies must fully disclose these emissions to avoid falling behind on ESG reporting, which could affect their competitiveness and reputation, especially as regulatory pressures on transparency continue to grow globally.

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TNG Digital Partners with Arus Oil for E-Wallet Payment Integration

TNG Digital has partnered with Arus Oil to allow e-wallet users to receive payments from recycling cooking oil. This partnership integrates environmental sustainability with digital payment solutions, enabling users to monetise waste oil directly through their Touch ‘n Go eWallet. This initiative supports Malaysia’s circular economy by encouraging responsible disposal and recycling of used cooking oil.

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This collaboration reflects the growing intersection between financial technology (fintech) and sustainability, making eco-friendly practices more accessible to everyday consumers.

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ACCA Committed to Driving Sustainability in Finance and Accounting

The Association of Chartered Certified Accountants (ACCA) has reaffirmed its commitment to driving sustainability in the finance and accounting professions. As businesses face growing demands for ESG compliance, ACCA is equipping accountants with the skills to integrate sustainability into financial decision-making processes.

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The association offers training and resources to help professionals navigate the complexities of ESG reporting and sustainable finance, ensuring accountants play a key role in promoting ethical business practices globally.

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Blueprint for Aviation Decarbonisation Launched

The Malaysian Ministry of Transport (MOT) has launched the Malaysia Aviation Decarbonisation Blueprint (MADB) to achieve net zero carbon emissions in the aviation sector by 2050.

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The blueprint outlines strategies for airlines, air traffic management, and airports, focusing on adopting sustainable aviation fuel (SAF), improving operational efficiency, and utilising carbon offsetting.

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Its targets include reducing emissions through SAF (46.2%), operational improvements, and carbon credits. The initiative aligns with global efforts to combat climate change and will be monitored by a dedicated steering committee.

RHB Bank and BNP Paribas New Sustainable Financial Process

In September, RHB Bank and BNP Paribas introduced Malaysia's first sustainable use-of-proceeds annexe for cross-currency repurchase agreements (repos). This initiative aims to promote sustainable finance practices by ensuring that proceeds from such transactions are directed toward green and socially responsible projects. The framework aligns with Environmental, Social, and Governance (ESG) criteria, supporting Malaysia’s broader sustainability goals.

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This marks a significant step in the Malaysian financial sector, setting a precedent for sustainable repo transactions, which can boost green finance efforts in the region.

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Malaysia to Implement Mandatory EPR for Manufacturers Within 5 Years

Malaysia plans to introduce mandatory Extended Producer Responsibility (EPR) regulations for the manufacturing sector within five years. This move will make manufacturers responsible for the entire lifecycle of their products, particularly the post-consumer stage, in an effort to reduce waste and boost recycling rates. The EPR will be a crucial step in the country's commitment to enhancing sustainability and minimising the environmental impact of industrial activities.

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The Malaysian government has emphasised the importance of transitioning to a circular economy. EPR is expected to encourage manufacturers to design more sustainable products, and this policy is seen as a key part of the nation's environmental strategy.

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Synergy ESCO Secures RM50 Million for Energy Efficiency Projects

Synergy ESCO has received a significant boost for its energy efficiency initiatives in Malaysia, securing RM50 million from Maybank's ESG funding program. The funds will be allocated to various projects that aim to optimise energy use and reduce emissions across different industries. This partnership aligns with Malaysia's broader ESG agenda and the government's push for greener business practices.

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Maybank's ESG funding demonstrates the growing trend among financial institutions to support sustainability-focused projects. Synergy ESCO will use the funding to develop technologies that enhance energy management systems, contributing to Malaysia's environmental goals.

Real Estate Companies Collaborate with GreenRE for Sustainable Building Projects

Tropicana Corporation Berhad has committed to promoting sustainable living by partnering with GreenRE, a leading green building certification body. This collaboration aims to incorporate sustainable practices into Tropicana's real estate projects, focusing on energy efficiency, water conservation, and reducing carbon footprints.

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The memorandum of understanding (MoU) signed by both parties marks Tropicana's long-term commitment to ESG principles and greener development. The real estate company's push toward sustainability aligns with the growing global and local demand for eco-friendly housing solutions.

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Meanwhile, OSK Property Holdings and RHB Bank have partnered to launch the Green Home Financing initiative, offering preferential mortgage terms for green-certified residential projects. The financing provides up to 95% + 5% for properties like Alia @ Mori Park and NARA at Shorea Park, also certified by GreenRE.

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The collaboration aims to promote sustainability in the property sector. RHB will allocate RM600 million in 2024 to support green homeownership. Both companies believe this initiative will encourage more developers to adopt eco-friendly practices and contribute to Malaysia’s low-carbon economy.

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Azec Decarbonization Framework Gains Momentum with Sarawak MoU

As part of the Asia Zero Emission Community (AZEC) Decarbonization Cooperation Framework, Asuene APAC and Dasar Consulting have signed an MoU to promote ESG initiatives in Sarawak, Malaysia. This agreement seeks to foster collaboration in the region's carbon reduction, energy efficiency, and sustainability projects.

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Sarawak, a state rich in natural resources, is keen to leverage such partnerships to balance its industrial growth with environmental responsibilities. The cooperation will support Sarawak's ambitions to align with international climate goals while enhancing the local economy.

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FCUC Leading the Way in Sustainable Education with ESG Principles

The First College of United Communities (FCUC) is pioneering sustainable education by integrating Environmental, Social, and Governance (ESG) principles into its curriculum. This initiative aims to equip students with the knowledge and skills needed to address contemporary global challenges related to sustainability. FCUC emphasises the importance of fostering an eco-conscious mindset among its students, preparing them to contribute positively to society and the environment. The college's commitment to sustainability reflects a growing trend in higher education to prioritise environmental responsibility and social impact.

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FCUC is taking a proactive approach in collaboration with various stakeholders to enhance its ESG initiatives. By embedding these principles into academic programs and campus operations, FCUC aims to create a comprehensive framework that supports sustainable practices. This initiative benefits students and aligns with broader societal goals to combat climate change and promote social equity, setting a benchmark for other regional educational institutions.

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Sustainable Solutions for Plastic Pollution

In a recent initiative, experts and stakeholders gathered to discuss sustainable solutions for combating plastic pollution in Malaysia. The forum emphasised innovative approaches to reduce plastic waste, enhance recycling efforts, and promote biodegradable alternatives. With growing concerns about environmental impacts, the discussion highlighted the need for collaborative strategies among government agencies, businesses, and communities to tackle this pressing issue effectively.

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The event served as a platform for sharing best practices and successful case studies, encouraging participants to adopt sustainable practices in their operations. The initiative aims to mobilise collective action towards a cleaner, greener future by raising awareness and fostering partnerships.

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Malaysian Government Pushes for Stronger Governance with Audit Act Amendments

The Malaysian government is moving forward with amendments to the Audit Act to strengthen corporate governance standards. These changes will enhance transparency and accountability in financial reporting, reflecting the government’s commitment to fostering a robust business environment. The amendments will address current gaps in audit practices and increase auditors' responsibilities, ensuring they adhere to high professional standards.

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The government aims to bolster investor confidence and protect stakeholders' interests by reinforcing governance frameworks. The proposed changes signify a proactive approach to addressing potential risks and ensuring that Malaysia remains an attractive destination for investment.

MITI Launches First Ministerial-Level Sustainability Report

The Ministry of International Trade and Industry (MITI) has launched Malaysia's first-ever ministerial-level sustainability report, showcasing the government's commitment to sustainable economic growth. The report highlights key initiatives and progress in implementing sustainability practices across various sectors. It aims to serve as a benchmark for transparency and accountability, encouraging public and private sectors to adopt sustainable practices.

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Through this report, MITI aims to promote a culture of sustainability, aligning Malaysia’s economic development with global sustainability goals. The initiative reflects a broader commitment to addressing environmental challenges while fostering economic resilience and competitiveness.

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Malaysia to Utilise Google's Data Center for Benchmarking

Malaysia plans to leverage data from Google’s data centre to benchmark its water and power usage as part of its sustainability efforts. This collaboration aims to improve resource efficiency and promote sustainable practices across industries. Using advanced analytics and insights from Google, Malaysia hopes to identify best practices and implement strategies for more efficient energy and water management.

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The initiative underscores the government's commitment to harnessing technology for sustainability, aligning with its broader goals of achieving environmental sustainability and responsible resource management. The hope is that this partnership will enhance Malaysia's capacity to track and optimise its resource consumption effectively.

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CIMB Collaborates with CGC for SME Funding

CIMB Bank has partnered with the Credit Guarantee Corporation (CGC) to provide an additional RM1.5 billion fund to support small and medium enterprises (SMEs) in Malaysia. This collaboration facilitates access to financing for SMEs, enabling them to invest in growth and sustainability initiatives, including improvement of their ESG performances. The fund will provide financial support tailored to the unique needs of SMEs, promoting resilience in a challenging economic environment.

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This partnership highlights the importance of supporting SMEs as a critical component of Malaysia’s economic landscape. By enhancing access to capital, CIMB and CGC aim to empower businesses to adopt innovative practices and contribute positively to the national economy.

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Global ESG News

Dezan Shiran & Associates Publishes Unlocking the ASEAN-6 | ESG Transition Landscape 2024

The new publication from Dezan Shiran & Associates offers a detailed analysis of evolving ESG reporting requirements in six major ASEAN markets: Malaysia, Indonesia, the Philippines, Singapore, Vietnam, and Thailand. The report helps businesses comply with sustainability regulations, enhance compliance, and improve investor confidence. It emphasises the collaboration between ASEAN exchanges to foster sustainable investments and create broader opportunities.

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With increasing regulatory pressures and investor scrutiny, the guide equips companies with key insights and resources to strengthen their ESG strategies for sustainable growth.

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Blackballing Oil a "Lost Cause" for ESG, Hedge Fund Veteran Warns

In a recent interview, a veteran hedge fund manager argued that excluding oil and gas companies from ESG investments is ineffective. He stressed that the global economy still heavily depends on fossil fuels, and removing these companies from portfolios would not hasten the transition to cleaner energy. The manager called for more engagement with oil firms to drive real change rather than pushing for blanket divestment.

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He believes working with these industries to adopt greener practices can be a more productive approach to achieving sustainability goals. The debate underscores ongoing tensions between ESG advocates and the fossil fuel sector as the world pivots toward decarbonisation.

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UPES Launches ESG Executive Program

India-based UPES announced the launch of its Executive Education Program on ESG, Sustainability, and Impact. This program is designed for professionals seeking to enhance their expertise in managing ESG issues. It offers advanced courses on sustainability frameworks and impact assessment.

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InCorp Global Wins Sustainability Award

InCorp Global was awarded the Sustainability Champion for Asia Pacific Award at PrimeGlobal’s Golden Globes 2024, recognising its commitment to sustainable business practices.

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The company has shown excellence in ESG initiatives, positioning itself as a leader in promoting sustainability across sectors. InCorp's initiatives include enhancing resource efficiency, reducing carbon footprints, and setting up systems that promote corporate social responsibility.

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Survey Reveals 31% of Hong Kong Firms Self-Rate Strong in ESG Sustainability

A recent survey in Hong Kong revealed that 31% of respondents believe their firms are strong in Environmental, Social, and Governance (ESG) sustainability practices. This self-assessment highlights a growing awareness among businesses regarding their responsibilities toward sustainable development. However, the survey also indicates that many companies may still have significant room for improvement in implementing effective ESG strategies.

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Despite some firms' positive outlook, experts urge a more critical evaluation of these self-ratings. They emphasise the need for transparent and standardised reporting practices to ensure that companies genuinely contribute to sustainability efforts. The findings suggest that while there is a recognition of the importance of ESG, practical actions and accountability must be followed to create meaningful impact in the corporate sector.

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Indonesia's BCA Walks the Talk on Sustainable Finance

Bank Central Asia (BCA), one of Indonesia's leading banks, is making significant strides in sustainable finance by implementing environmentally friendly practices. The bank has announced a comprehensive plan to increase its sustainable financing portfolio, focusing on supporting projects contributing to environmental conservation and social welfare. BCA’s commitment to sustainability reflects a growing trend among financial institutions to incorporate ESG (Environmental, Social, and Governance) criteria into their lending practices.

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BCA's initiatives include offering loans with lower interest rates for green projects and actively promoting financial literacy programs focused on sustainability. By fostering sustainable finance, BCA aims to enhance its business resilience and play a pivotal role in Indonesia’s transition towards a more sustainable economy. The bank's efforts signal a shift in the financial sector's approach to supporting sustainable development.

Vingroup Building a Green Future with Its Ecosystem

Vietnamese conglomerate Vingroup is taking significant steps toward building a sustainable future through its comprehensive ecosystem. The company is focusing on integrating green technologies and practices across its diverse business operations, ranging from real estate to technology and healthcare. Vingroup's commitment to sustainability is reflected in its investment in renewable energy projects and the promotion of electric vehicles, aiming to reduce its environmental footprint.

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By prioritising sustainability, Vingroup seeks to align its business model with global eco-friendliness and social responsibility trends. The company's initiatives aim to enhance competitiveness and contribute to Vietnam's broader environmental goals. Vingroup’s efforts exemplify the potential for businesses to play a crucial role in fostering a sustainable future within their operational frameworks.

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Wyloo and Metalshub Partner for Green Nickel Transparency

Wyloo Metals has partnered with Metalshub to enhance transparency in the green nickel market. This collaboration aims to establish a standardised approach for tracking and reporting the sustainability of nickel production, addressing the growing demand for responsible sourcing in the electric vehicle industry. By focusing on transparency, the partnership seeks to build trust among stakeholders and promote responsible supply chain practices.

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The initiative reflects a broader trend within the mining and metals industry towards greater accountability and sustainability. Wyloo and Metalshub aim to support the transition to a low-carbon economy by ensuring that nickel sourcing meets high environmental and social standards.

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Upcoming ESG Events and Seminars

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The 2nd European Sustainable Plastics Summit

October 22 - 23

Frankfurt, Germany and Online

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Responsible Investment Forum Asia 2024

October 29 - 30

Marina Bay Sands, Singapore

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Assessing Malaysia’s Opportunities & Risks: Insights for 2024 and Beyond

Thursday, November 21 2024 at 16:00

Online Webinar

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Shaping Asean's Sustainable Future

November 6 - 7th from 8 am to 6 pm

KL Convention Centre, Kuala Lumpur

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