Dire Warning

Do you ever sense a sense of urgency when it comes to ESG development and sustainability in Malaysia? Are we really making the most out of the resources we have or are we still pursuing a business-as-usual approach? With increasing global awareness and a need to ensure sustainable development, it has become increasingly important that Malaysia moves from ‘good’ to ‘great’ when it comes to ESG development.

The recent Intergovernmental Panel on Climate Change (IPCC) report serves as a dire warning for the world and serves to highlight the need for urgent action. Climate change is no longer an issue to be ignored; human beings are responsible for the drastic transformation of our planet and we must take measures to reduce emissions and mitigate the damage being caused. Failure to take global action could result in catastrophic consequences, such as the disruption of entire ecosystems and extreme weather patterns, leading to devastating levels of drought, floods and heatwaves.

It is here that we need to immediately change our narrative about sustainability. When it comes to sustainability, the first thing that comes to mind is often those cute polar bears in TV commercials. But sustainable development doesn’t only involve environmental initiatives and the protection of endangered animals; it also encompasses economic and social progress. This is why we need to take a holistic approach to ESG development in Malaysia. We need to think about the health of our ecosystems, the well-being of our citizens, and the success of our businesses.

Addressing Malaysia’s Lack of Awareness on Sustainable Development

Despite significant progress towards sustainability in Malaysia, there remains a concerning lack of understanding and awareness of its importance.

While it is challenging to pinpoint a single actor responsible for this issue, it is clear that various groups must take action to address it. Governments and corporations hold an essential role in owning responsibility for their Environmental, Social, and Governance (ESG) practices. Currently, sustainability is often considered an optional addition rather than an essential element. This perspective results in fewer resources being allocated towards sustainability, creating inaction and overall lack of enthusiasm in setting, implementing, and monitoring standards.

The initial step towards achieving meaningful progress in ESG development is to examine our current efforts critically. We must identify specific areas for improvement and take necessary action. Malaysia’s ESG standards are high compared to many countries; however, it requires improvement, especially in the enforcement of these standards to achieve more excellent results. Companies must develop tailored ESG initiatives for all stakeholders, including women, to increase gender equality in the workplace.

On International Women’s Day 2023, Q3 Management Solutions Sdn Bhd hosted a Women and ESG event to raise awareness and promote change. This event highlighted the importance of inclusion in ESG standards and empowered female professionals to share their valuable perspectives. By providing targeted resources and advocating for female representation on boards and in ESG decision-making, we will make progress towards gender parity within ESG practices..

Bridging the ESG Gap

To bridge this gap, the government could provide incentives to companies that comply with the regulations, and also impose stricter penalties on those that do not. One incentive that can be applied to companies that comply with the sustainability agenda is to offer them tax breaks or other financial incentives.

In addition, governments can also create regulations that reward companies that take proactive steps to reduce their environmental impact, such as setting higher standards for certain products or processes. Other forms of incentive could include access to government grants or funding, preferential access to government contracts or even awards and recognition.

Companies could also enter into public-private partnerships with local governments, universities or other relevant organisations to further the goals of sustainability. Further, companies could also benefit from improved public relations and boost customer loyalty by being leaders in the fight against climate change.

Additionally, there are certain areas where Malaysia could be doing more when it comes to ESG development, such as in the area of waste management. For example, composting programmes and recycling centres should be mandatory in all towns and cities across the nation. This would help to reduce waste and improve our air quality, as well as save money in the long run.

Finally, we also need to look beyond ourselves and consider how we can instill a sense of awareness, responsibility and sustainable practices in the next generation. Education is an incredibly powerful tool – one that should be harnessed to help build an understanding of the importance of ESG development and sustainability. After all, it’s our youth who will be leading the charge in the future, and it’s up to us to ensure that they have the right tools and knowledge to do so.

At the end of the day, sustainable ESG development in Malaysia is a long-term process. We cannot expect to achieve success overnight, but we can certainly take strides in the right direction. By challenging our current systems, introducing new standards, and engaging the youth, we can successfully move from ‘good’ to ‘great’. Malaysia has the talent, resources, and potential to deliver meaningful ESG and sustainability improvements. The key question then is, “are we ready to take action?”

Ultimately, if we want to make meaningful progress toward sustainable ESG development in Malaysia, it’s going to take a collective effort. But the good news is, together we can make a difference. As they say – small steps lead to a hundred miles. So, come join me on this journey of transformation! After all, I’m an environmental junkie and I’m ready to do my part!

At Mindsights Consulting, we can help business executives who are looking for ways to enhance their organizational capacity building on sustainability. Take a look at our previous blog post on innovative ESG practices in the supply chain by visiting http://www.mindsightsconsulting.com.”