Insight - Big firms should lead the way in ESG

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Against growing awareness of ESG, boards have been found to be lacking in ESG skills.

However, the impression and perception of the index will improve based on its constituents, even though it is not an opt-in index but one in which an organisation qualifies for, based on the Financial Times Stock Exchange’s assessment methodology.As an example, government-linked companies had led in terms of adopting the Global Reporting Initiative reporting framework relating to critical sustainability issues, ahead of the launch of the Sustainability Reporting Framework and F4GBM index.

ICDM will play the role of a one-stop centre for boards and directors in delivering bespoke offerings such as board evaluation and placement services, as well as development programmes to ensure that it can equip boards and directors with ESG skills. It is a measure of an organisation’s values and business ethics which translate into the decisions they make.

Institutional investors, specifically, government-linked investment companies such as the Employees Provident Fund, Kumpulan Wang Persaraan and Khazanah Nasional Bhd, as well as Institutional Investors Council Malaysia, have also advocated for greater ESG/sustainability adoption and disclosure. This is especially since the assessment for qualification is based on publicly available information, an approach which validates the importance of good corporate governance.

As part of its Edgenta of the Future 2025, the group aspires to develop a holistic sustainability blueprint and strategy for a full-fledged sustainability business arm. “As the largest investment bank in the country, Kenanga Investment Bank is set to expand its sustainability disclosures in the upcoming sustainability statements,’’ said Kenanga Investment Bank group managing director Datuk Chay Wai Leong.

 

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Malaysian companies can do so much more to equip their boards with ESG skills, and embed ESG into their DNA. MNCs operating in Malaysia should lead the way, but sadly it is not the case. SDGs ESG sustainability SustainabilityReport

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