ESG: More Important Now Than Ever for Your Business !
- Sustainability and ESG are taking on an even greater significance in recent years. Governments are mandated to protect people, social and institutional structures, and environment. ESG influences business and investment attraction. Customers are getting more attentive to environmental issues, climate change and extreme weather events, social unrest and economic pressures on society and environment.
- For businesses and investors, a robust ESG program can access to a large pool of capital, increase productivity and profits, build a stronger corporate brand and promote sustainable long-term growth benefiting stakeholders.
- Malaysia is embarking on an early stage of the ESG journey. There is increasingly environmental awareness and focusing on sustainability issues among consumers and businesses.
- Transitioning to ESG and a net zero economy presents significant opportunities and challenges.
- Negative implications without ESG: (i) Losing Substantial Customers; (ii) Losing Talents; (iii) Losing Substantial Foreign Investment and (iv) Sales and Brand Image Damage
- Positive implications of ESG: (i) Attracting Talents; (ii) Attracting Customers; (iii) Attracting Investment and (iv) Higher Profitability; Reduce Operating Costs and Cost Savings
- SMEs face challenges in the adoption of ESG: (i) ESG Standards: Lack of Consistency; (ii) Concern About Performance/Sacrificing Returns; (iii) Data Reporting Challenges; (iv) Lack of ESG Talent and (v) Cost Concerns.
- Institutional investors are increasingly demanding for better ESG disclosures to help them understand more about how a company integrates ESG into the business; treats its employees; makes decisions; and creates value to stakeholders. Therefore, further efforts are needed to strengthen the adoption of ESG practices in the Malaysian businesses so that they are future-proof in the global market.