Sustainable companies in Malaysia refer to businesses that incorporate environmental, social, and governance (ESG) criteria into their operations, aligning with the United Nations Sustainable Development Goals (SDGs). These companies focus on long-term strategies that balance economic growth with positive social impacts and environmental stewardship. This definition is consistent with Malaysia’s policies and regulatory frameworks that encourage sustainable business practices.
For example, Sime Darby and Petronas have embedded sustainability into their corporate strategies through renewable energy projects and carbon reduction initiatives. Top Glove, a major rubber glove manufacturer, has implemented waste reduction and energy efficiency measures in its production processes. Bursa Malaysia has introduced the FTSE4Good Bursa Malaysia Index to recognize companies that meet globally recognized ESG standards.
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What Are The List Of Sustainable Companies in Malaysia?
Malaysia has many businesses integrating environmental, social, and governance (ESG) practices into their core operations. These sustainable companies span a variety of sectors, including energy, manufacturing, and waste management. They drive innovation through renewable energy, carbon reduction, responsible sourcing, and community-focused initiatives. Below are the key sustainable companies in Malaysia:
- PETRONAS – Malaysia’s national oil and gas company, investing in renewable energy and developing a biorefinery in Pengerang to produce sustainable aviation fuel (SAF) by 2027.
- Sime Darby Plantation – Transforming land in Perak into a green industrial park, including 660 acres of solar farms as part of its net-zero roadmap.
- Top Glove – The world’s largest glove maker with ESG initiatives like solar power, water recycling, biodegradable gloves, and ESG-linked compensation.
- Tenaga Nasional Berhad (TNB) – The national utility expanding into renewable energy through its TNB Renewables arm.
- Yinson Holdings – Energy infrastructure firm venturing into clean energy and EV technology through Yinson GreenTech.
- Alam Flora – Waste management provider promoting environmentally friendly public-cleaning technologies.
- Kuala Lumpur Kepong Berhad (KLK) – Plantation and oleochemical giant integrating sustainability into its operations and supply chain.
- IJM Corporation Berhad – Involved in property, infrastructure, and plantations, IJM integrates green building designs, eco-friendly construction practices, and biodiversity preservation.
- Sunway Group – A diversified conglomerate leading in sustainable urban development with green buildings, ESG-linked Sukuk, and the Sunway Centre for Planetary Health.
- Fraser & Neave Holdings Bhd (F&N) – Beverage and dairy producer focusing on water stewardship, plastic circularity, and sustainable sourcing of ingredients.
- UMW Holdings Berhad – Active in automotive and manufacturing, UMW promotes energy-efficient production and green logistics solutions.
- Nestlé Malaysia – Known for its RE100 commitment, regenerative agriculture projects, and packaging sustainability.
- Sapura Energy – Oil and gas company incorporating energy transition strategies and carbon management frameworks.
- SP Setia Berhad – Property developer embedding sustainable township concepts and low-carbon building materials into its projects.
- Malayan Banking Berhad (Maybank) – Financial institution driving sustainable finance through its RM50 billion sustainable financing commitment and ESG screening.
- CIMB Group – Implements ESG frameworks across lending and investment, with a net-zero commitment by 2050.
- Gamuda Berhad – Infrastructure firm incorporating circular construction, green tunnels, and sustainable materials in projects like the MRT lines.
- Berjaya Corporation – Diversified conglomerate with initiatives in green hotels, organic farming, and clean energy investments.
How Do Sustainable Companies in Malaysia Operate?
Sustainable companies in Malaysia operate by aligning their business models with global and local sustainability frameworks. Many adhere to the Environmental, Social, and Governance (ESG) criteria, which assess corporate responsibility in environmental conservation, social equity, and transparent governance.
These companies often follow guidelines set by Bursa Malaysia, which mandates ESG reporting for listed firms. Petronas, for instance, publishes annual sustainability reports detailing emissions reductions and community engagement programs. Tenaga Nasional Berhad (TNB) invests in solar and hydropower to transition toward renewable energy.
What Are the Key Sustainability Practices in Malaysian Companies?
Key sustainability practices in Malaysian companies include renewable energy adoption, waste management, and sustainable supply chain management. Over 50% of Malaysia’s electricity is expected to come from renewable sources by 2035, driven by companies like Cypark Resources and TNB.
Waste reduction is another priority. Nestlé Malaysia has committed to zero waste to landfill across its factories by 2025. The Malaysian Plastics Manufacturers Association promotes circular economy principles, encouraging recycling and biodegradable packaging.
Which Industries Lead Sustainability Efforts in Malaysia?
The energy, manufacturing, and agriculture industries lead sustainability efforts in Malaysia. The energy sector, represented by Petronas and Sime Darby Plantation, focuses on carbon-neutral initiatives and sustainable palm oil production.
Manufacturers like Panasonic Malaysia and Top Glove prioritize energy-efficient production and waste reduction. In agriculture, the Roundtable on Sustainable Palm Oil (RSPO) certifies companies that meet strict environmental and labor standards.
What Role Does Government Policy Play in Promoting Sustainable Companies?
Government policy plays a critical role in promoting sustainable companies through regulations, incentives, and national frameworks. The Malaysian Green Technology and Climate Change Corporation (MGTC) oversees green financing and technology adoption.
The Sustainable Energy Development Authority (SEDA) administers the Feed-in Tariff (FiT), encouraging renewable energy projects. Bursa Malaysia’s FTSE4Good Index lists companies with strong ESG performance, attracting sustainable investments.
How Do Malaysian Companies Measure Sustainability Performance?
Malaysian companies measure sustainability performance using ESG metrics, carbon footprint assessments, and third-party certifications. The Global Reporting Initiative (GRI) provides standardized sustainability reporting guidelines.
MyCREST, a Malaysian carbon assessment tool, helps firms track emissions. Companies like Sime Darby Plantation and IOI Corporation undergo RSPO certification to verify sustainable palm oil production.
Why Is It Important To Become A Sustainable Company?
Malaysian companies can ensure long-term success while contributing to national and global sustainability goals. Becoming a sustainable company in Malaysia is important for these 8 reasons:
1. Long-term Viability
Sustainable companies are better equipped to manage risks associated with climate change and resource scarcity for future success. As environmental regulations in Malaysia continue to strengthen, businesses that adopt sustainable practices are better positioned for long-term stability.
2. Competitive Advantage
In Malaysia, consumer preferences are shifting towards environmentally and socially responsible products and services. Companies that emphasize sustainability often enjoy a more substantial brand reputation and competitive edge in the market.
3. Regulatory Compliance
Malaysia’s environmental regulations, such as the Environmental Quality Act, are evolving. Compliance with these regulations is a key driver for companies to adopt sustainable practices and ensure they remain in good standing with regulatory authorities.
4. Investor Appeal
Investors, including institutional ones in Malaysia, are increasingly focusing on ESG factors when making investment decisions. Companies that integrate sustainability into their operations are more likely to attract capital and maintain investor confidence.
5. Innovation Driver
Sustainability can drive innovation, leading to more efficient processes and new business opportunities. In Malaysia, sectors like renewable energy and waste management are growing areas for sustainable innovation, offering companies new avenues for growth and development.
6. Talent Attraction and Retention
Younger generations in Malaysia are more inclined to work for companies that prioritize social and environmental responsibility. Sustainable companies are, therefore, better positioned to attract and retain top talent in a competitive job market.
7. Stakeholder Trust
Building trust with stakeholders, including local communities, is crucial for long-term success. In Malaysia, many businesses engage in community-based programs to enhance their social impact and strengthen their relationships with various stakeholders.
8. Global Market Access
As international supply chains increasingly emphasize sustainability, Malaysian companies that meet ESG standards are more likely to engage in global trade partnerships. This is particularly important for Malaysia’s export-oriented economy.
What Are the Challenges Faced by Sustainable Companies in Malaysia?
Sustainable companies in Malaysia face challenges such as high initial costs, regulatory complexity, and consumer awareness gaps. Transitioning to renewable energy requires significant investment, with solar panel installations costing RM 20,000 to RM 50,000 per household.
Smaller firms struggle with compliance due to evolving ESG regulations. Consumer demand for sustainable products remains low, with only 30% of Malaysians willing to pay a premium for eco-friendly goods.
What Is SDG, and How Does It Benefit Companies in Malaysia?
The Sustainable Development Goals (SDGs) are a set of 17 global objectives adopted by the United Nations in 2015, aiming to address critical issues such as poverty, inequality, climate change, and sustainable economic growth by 2030. For companies in Malaysia, aligning business strategies with the SDGs offers several tangible benefits:
- Enhanced Reputation
Companies that actively support SDGs tend to gain stronger brand recognition, customer loyalty, and public trust, especially in markets increasingly conscious of sustainability. - Access to New Markets
Sustainable products and services aligned with SDGs open new business opportunities, especially in sectors like green technology, renewable energy, and ethical consumer goods. - Improved Stakeholder Relationships
Demonstrating commitment to SDGs can strengthen ties with key stakeholders, including regulators, investors, employees, and the local community. - Risk Mitigation
Addressing long-term sustainability challenges such as climate change, resource depletion, and regulatory shifts helps companies manage operational and reputational risks more effectively. - Innovation Catalyst
SDGs encourage innovation in business models, products, and services, helping companies remain competitive and future-ready.
What Are Examples of Sustainable Development in Malaysia?
Malaysia has adopted various national policies and initiatives to promote sustainable development. These efforts span clean energy, smart urban planning, sustainable agriculture, and environmental conservation:
- Renewable Energy Projects
Malaysia’s Large Scale Solar (LSS) program and hydroelectric initiatives in Sarawak highlight the country’s shift toward clean and renewable energy sources. - Sustainable Cities
Projects like the Iskandar Malaysia Low Carbon Society Blueprint and Putrajaya Green City 2025 aim to reduce urban carbon footprints and promote sustainable urban planning. - Sustainable Agriculture
The Malaysian Sustainable Palm Oil (MSPO) certification ensures responsible and traceable palm oil production aligned with international sustainability standards. - Forest Conservation
The Central Forest Spine (CFS) initiative reconnects fragmented forest ecosystems to preserve biodiversity and ecological balance. - Sustainable Transportation
Mass Rapid Transit (MRT) developments and the promotion of electric vehicles (EVs) are contributing to lower carbon emissions in Malaysia’s transport sector.
What Are the Differences Between Sustainable Companies and Eco-Friendly Companies in Malaysia?
While both types of companies support environmental efforts, they differ in scope and strategic orientation. Below are six key differences:
- Scope of Focus
Sustainable companies adopt a broad ESG approach, covering environmental, social, and economic goals, while eco-friendly companies mainly focus on minimizing environmental harm. - Long-Term Perspective
Sustainable companies integrate long-term thinking into their strategies; eco-friendly companies often focus on short- to medium-term environmental gains. - Holistic Approach
Sustainable businesses embed sustainability across departments and decision-making. Eco-friendly businesses may apply green practices to select areas or products only. - Measurement and Reporting
Sustainable companies often publish detailed ESG or sustainability reports (e.g. via Bursa Malaysia’s guidelines), whereas eco-friendly companies may only highlight environmental impact metrics. - Stakeholder Engagement
Sustainable businesses engage a broad group of stakeholders—investors, regulators, staff, and communities. Eco-friendly firms may concentrate on environmentally concerned customers or NGOs. - Economic Integration
Sustainable companies strive to balance environmental, social, and economic priorities. Eco-friendly companies may prioritize environmental objectives even at potential economic trade-offs.
How Does ESG Training Support Malaysia’s Sustainability Goals?
As Malaysia intensifies its push toward sustainable development, ESG (Environmental, Social, Governance) training becomes essential. These training programs equip companies with the skills and frameworks necessary to align with the SDGs and national sustainability policies, such as the Twelfth Malaysia Plan and the Green Technology Master Plan.
Such training helps Malaysian companies:
- Integrate ESG into core strategies and governance
- Understand regulatory compliance and global sustainability expectations
- Align operations with investor demands and supply chain sustainability
What Types of ESG Training Programs Support Malaysian Sustainability?
ESG training programs in Malaysia are designed to reflect local sustainability challenges while aligning with global standards. These programs may include:
- Certified ESG Practitioner (CESGP)
- Sustainability Accounting Standards Board (SASB) training
- Global Reporting Initiative (GRI) certification courses
They often incorporate Malaysian case studies, sector-specific regulations, and frameworks tailored for industries such as palm oil, manufacturing, and financial services.
Courses help businesses:
- Build ESG-compliant business models
- Develop sustainability reports
- Strengthen supply chain due diligence
- Prepare for ESG disclosures required by Bursa Malaysia or foreign investors
How Can Job Seekers Contribute to Sustainable Companies?
Job seekers can contribute to sustainable companies by pursuing careers in green technology, renewable energy, and corporate sustainability. Roles in solar energy installation, ESG consulting, and sustainable supply chain management are growing.
Platforms like Majikan.my connect professionals with sustainability-focused employers. Companies like GreenTech Malaysia and TNB frequently list openings for engineers, analysts, and sustainability specialists.