4.3 Measuring Social and Environmental Impacts
Measurement of sustainability is crucial for Malaysian companies interested in securing ESG investments and obtaining funding or accreditation from the government and overseas.
- Why Measure Impact in Malaysia?
- Comply to ESG disclosure requirements of Bursa Malaysia.
- Creating a sense of trust amongst stakeholders in Malaysia’s developing green economy.
- Obtain incentives from the government, like the Green Investment Tax Allowance (GITA).
- Key Impact Measurement Tools in Malaysia:
- The Global Reporting Initiative (GRI) Standards are used by Malaysian multinational companies like Sime Darby and Petronas
- Bursa Malaysia FTSE4Good Index: Measures an ESG performance of the listed companies in Malaysia.
- Life Cycle Assessment (LCA): Employed by firms such as Top Glove in tracking sustainability of glove production.
- SROI (Social Return on Investment): Applied in CSR programs such as Khazanah Nasional’s Dana Impak for rural development.
| Impact Category | Malaysian Example Metrics |
| Social | Percentage of Malaysian suppliers trained on ESG standards; diversity ratio in workforce |
| Environmental | Reduction in water use in palm oil plantations (Sime Darby); percentage renewable energy in operations (Petronas) |
| Economic | Growth in green product sales; local SME support through supply chains |
Malaysian Example:
- Nestlé Malaysia’s Project RELeaf: Has a vision to plant three million trees by 2030 in efforts to offset carbon emissions and to promote biodiversity conservation in Sabah and Sarawak.
- SP Setia’s Eco-Townships: Use green building standards, incorporate sustainable drainage systems and community engagement programs.
definition
A company’s role as a “good citizen” that contributes positively to the well-being of its local community.
