Environmental, Social and Governance (ESG) is a term used to represent an organization's corporate financial interests that focus mainly on sustainable and ethical impacts. Capital markets use ESG to evaluate organizations and determine future financial performance.
Since 2021, research analysts have assigned ESG scores to all companies under their coverage, monitored these scores, and also integrated them into their stock valuations. We believe sustainable investment strategies will continue to deliver above-market returns.
ESG has widened a company’s stakeholder list but how corporates embrace, adapt and benefit from ESG can be equally broad, from the use of more renewable energy to the introduction of new products.
And, in this article, we would like to highlight some of the listed companies on Bursa Malaysia, which is doing good in terms of ESG and why.
Let's kick things off with the below (not in any specific rankings)...
- Press MetalPress Metal (PMAH) is a Malaysia-based aluminium company with an extensive global presence. There are good levels of transparency afforded by the company’s reporting framework and management’s regular dialogues with investors.Most importantly, Press Metal’s carbon footprint ranks amongst the best in the global aluminium industry, thanks to it having access to hydropower, possibly boosting its long-term upside on the burgeoning market potential for low-carbon aluminium.
- Samaiden GroupSamaiden is a renewable energy (RE) turnkey EPCC services provider that offers end-to-end solutions to build RE – mainly solar photovoltaic (PV) – systems from scratch. It also aims to own RE projects.Samaiden ensures that its works comply with environmental laws and regulations to minimise any adverse impact on the environment. It is also constantly monitoring sub-contractors and suppliers to avoid any environmental incidents and hazards. Its services are beneficial to the environment over the long run.Samaiden has adopted a series of human resources policies and best practices to build a conducive work environment and a positive workplace culture. The company also funds staff training costs to upskill workers. Samaiden has applied and adopted the majority of best practices of the Malaysian Code on Corporate Governance.
- Sunway Construction GroupSunway Construction Group is one of Malaysia’s largest construction companies. The company has implemented rooftop solar panels costing MYR8.8m at its Sunway Precast Industries plant at Senai, Johor and Sunway Enterprise Park, to reduce carbon emissions at site operations. With this, 373MWh of energy can be consumed via solar generation at these locations, avoiding 218 tonnes of carbon emissions.The group ensures the safety and health of all its employees, and public areas surrounding the construction sites, via various training and safety programmes.
- HPP Holdings BerhadHPPHB is a one-stop printing and coating solution specialist for paper-based packages.The company recycles 100% of its paper waste through a third party. Scheduled waste is monitored in accordance with the Environmental Quality (Scheduled Wastes) Regulations 2005 and ISO 14001:2015. Solar installations in two of its plants help to achieve energy efficiency and reduce CO2 emissions.For sustainable packaging, the group is investing in a moulded pulp packaging plant, starting with three production lines in 2H 2023. Made from recycled paper, this type of packaging is aimed at replacing polystyrene currently used in the E&E, health, food and beverage and lifestyle segments.HPPHB sources Forest Stewardship Council-certified (FSC) paperboard from seven suppliers to cater to about 20% of its. FSC-certified products are sourced from responsibly managed forests.
- Kumpulan Perangsang SelangorFrom being corporate social responsibility-driven, KPS has realigned its sustainability strategy to a 5-phase roadmap that includes fostering and accelerating sustainable development to ensuring business sustainability stretching from 2022 to 2035.In line with its emphasis on improving ESG disclosures, KPS began disclosing its Scope 1 and 2 emissions for its Malaysia operation in 2021 with the aim of establishing a carbon baseline for these two scopes in the near future. At the same time, it has begun preparation for Scope 3 emission data.Resource and material efficiency, and water, waste and energy management are among KPS's key ESG KPIs. Highlighting the circular economy at work, Century Bond (CBB) achieved zero manufacturing waste by converting all its carton trim waste.
- Thong Guan IndustriesThong Guan is stepping up its ESG initiatives, key among them is reducing GHG emissions, better energy management and product innovation. It practices zero-plastic production waste as all these are recycled into resin at the plant itself.The company plans to achieve 30% of its total sales from recycled-content products, with green revenue targets of 15% and 30% by 2025 and 2035, respectively. Its NanoGreen (30% recycled machine film) and MaxStretch stretch films were awarded the International Sustainability and Carbon Certification (ISCC) last year.
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