ESG

KUALA LUMPUR: Organisations with a keen interest in supporting Malaysia’s sustainability goals as outlined in the Industrial Master Plan 2030 and the National Energy Transition Roadmap are recommended to commence their sustainability efforts by investing in IT infrastructure monitoring tools.   ManageEngine President Rajesh Ganesan said the tools could effectively monitor energy consumption in buildings, devices and cloud infrastructure. He said this would help them understand how much energy they are consuming and emitting, which helps in planning and validating necessary changes, such as outsourcing, adopting green-coding practices and reducing overall energy usage. “Organisations can then implement green practices, such as investing in renewable and solar energy, whilst ensuring that they are complying with local regulations and growing responsibly in the realm of energy transition and sustainable development. Effective governance frameworks can then guide organisations in embedding sustainability into their core operations. “In addition, business leaders need to have a mindset shift regarding how sustainability will impact their bottom line and competitiveness in the long run, aside from focusing on short-term investments in costs and resources,” he said. Rajesh said in Malaysia’s context, the recognition of how green initiatives are critical for the country’s industry growth could be seen in the Malaysia Investment Development Authority’s (MIDA) approval of 4,073 green projects worth over RM38.9 billion as of September 2023 and is expected to increase in 2024. He said the Malaysian government’s strong commitment, partnered with support from the private sector in the areas of energy, agriculture, transportation and manufacturing, would enable the nation to achieve its net zero emissions target by 2050. “Local businesses need to focus on integrating sustainable practices and balance technological advancements with environmental responsibility. “By recognising that reducing Malaysia’s carbon footprint is one of the catalysts for transforming the economy on a more sustainable path, Malaysia is on the right path towards success and achieving a greener future,” he said. On ways for organisations to build a greener future, such as focusing on operational efficiency and green upgrades Rajesh recommended conducting surveys to identify unsustainable practices, using energy-efficient applications and investing in eco-friendly software and equipment. “Besides that, explore renewable energy options where applicable. Some companies strategically locate near renewable energy plants, while others install solar units on-premises,” he said. He also suggested organisations manage data centres efficiently to reduce storage and power usage by using data centre management software to analyse performance and identify bottlenecks for optimal usage. — BERNAMA

HANGZHOU: Hikvision has published its ‘2023 Environmental, Social and Governance (ESG) Report’, disclosing its ESG practices and performance for the sixth consecutive year. The report offers a comprehensive look at Hikvision’s focus on sustainability and its ESG priorities and actions, reaffirming the company’s commitment to fulfilling corporate social responsibility with innovative and sustainable technologies. “Practicing the ethos of ‘Tech for Good’, adhering to pragmatism, and exploring ‘green’ transformation, Hikvision leverages our products to deliver the value of sustainable development,” said its Chief Compliance Officer and Senior Vice President, Huang Fanghong. “We firmly believe that together with the momentum of digital transformation and technological advancements, we will attain stable and sustainable growth,” he added. With the belief that technologies play a pivotal role in promoting overall well-being, Hikvision has formulated an ESG management framework with ‘Tech for Good’ as its core. Leveraging cutting-edge technologies, Hikvision endeavored to protect historical relics, prevent water and air pollution, as well as enhance efficiency and productivity in manufacturing. Moreover, the company has contributed to providing more educational resources for children in remote areas, ensuring abundant apple harvests, and safeguarding wildlife, fulfilling its part to further the aspiration to build a better world. Apart from giving back to the society with innovative technologies, Hikvision places great emphasis on integrity and compliance, low-carbon development, and harmonious relationships with employees, partners, and communities, integrating these principles into its ESG management framework. Some highlights during the reporting period include: The company released the Hikvision Global Human Rights Policy, embedding the respect for human rights in the company’s governance and operations. Hikvision formulated and introduced the Management Procedure for Greenhouse Gas Emissions, aiming to reduce greenhouse gas (GHG) emissions and promote low-carbon operations. Hikvision further integrated eco-friendly principles into the process of product R&D, design, packaging and utilisation. By acquiring carbon footprint verifications of representative products, the company evaluated the GHG emissions throughout those products’ life cycles for continuous improvement. While promoting energy savings, Hikvision also proactively advanced the procurement of green power. In 2023, around 12,533.7 MWh of power was generated by photovoltaic (PV) systems deployed in the company’s manufacturing bases. Hikvision continued to drive sustainable development through innovation, winning 1,884 invention patents in 2023. The R&D investment of the company reached C¥11.39 billion (RM7.42 billion), up 16.08% year-over-year. Adhering to responsible procurement, Hikvision continuously enhanced supplier management. 100% of the new suppliers of the company were screened using the environmental and social criteria. Hikvision provided its employees with a series of trainings to support their personal and professional development, with total training time reaching 1,534,482 hours. Hikvision employees engaged actively in volunteer activities, collectively dedicating over 20,000 service hours.

KUALA LUMPUR: Malaysian plantation companies should improve transparency and accountability in their environmental, social and governance (ESG) reporting to enhance credibility, said an academician. Universiti Teknologi MARA (UiTM) Faculty of Accountancy Associate Professor Dr Seri Ayu Masuri Md Daud said that findings from her team’s research on environmental disclosure in the plantation industry revealed that despite environmental concerns, the majority of environmental reporting by plantation firms remains dominated by ‘soft’ information such as vision statements and general environmental initiatives. “This type of reporting often lacks the depth and specificity required to provide stakeholders with a clear understanding of the company’s environmental impact and management practices,” she said. Masuri believes that the most significant challenges and criticisms of current ESG practices include greenwashing and the aspirational gap. “One major concern is the perceived gap between companies’ aspirations and their actual performance concerning ESG practices. This phenomenon, often termed ‘greenwashing’, not only erodes stakeholder trust but also undermines the credibility of ESG efforts. “Institutional investors are wary of such discrepancies, highlighting the need for greater transparency and accountability,” said Masuri, who is also a member of the varsity’s Sustainability and Governance Talent Cluster. In jurisdictions where sustainability reporting is mandatory, like Malaysia, she said that a significant challenge lies in bridging the gap between companies’ aspirations and their actual ESG performance. “To address this, robust rules must be established to combat both corporate and institutional investor greenwashing, thereby safeguarding stakeholder interests. “For example, measures should be implemented to prevent institutional investors from misleadingly labelling funds as ESG-compliant when they fail to adhere to ESG principles,” Masuri said. She said that a lack of uniform ESG reporting standards further compounds the problem as companies and investors often measure and report on different metrics in varying ways, leading to inconsistencies and incomparability. “This lack of standardisation hampers the ability to accurately assess and compare ESG performance across companies and industries,” she added. The associate professor noted that companies may engage in symbolic reporting, where disclosures may not reflect meaningful actions and outcomes. “In Malaysia, despite the mandate for sustainability reporting, companies retain considerable discretion in determining the content of their disclosures. “Our research on environmental disclosure in the plantation industry underscores this issue, revealing a prevalence of soft information over substantive disclosures,” she highlighted. Masuri also emphasised the role of government policies and international regulations in shaping ESG practices. “Government policies and international regulations play a crucial role in shaping ESG practices globally. “While sustainability reporting remains voluntary in many regions, there is a growing recognition of the need for mandatory reporting to ensure transparency and accountability across all firms,” she said. Masuri said researchers have proposed several key measures to improve the effectiveness and integrity of ESG practices within the industry. “It is recommended that regulators focus not just on the volume of ESG discolures but also on enhancing their quality. There is a pressing need for more substantive reporting that can offer real insights into companies’ ESG activities and performance. “Transparency and accountability are needed where more substantive disclosure is essential to enhance transparency and reduce information asymmetry between stakeholders and management. Truthful reporting, backed by concrete actions and outcomes, is critical for building trust and credibility in ESG practices,” she said. Masuri concluded that to overcome the shortcomings of current ESG practices and to ensure they genuinely reflect companies’ environmental stewardship, concerted efforts from regulators, companies and investors are indispensable. “By promoting standardisation, transparency and accountability, I believe that a more robust and credible ESG reporting and implementation framework for these companies can be established, thus creating more transparent and genuine ESG reporting,” she added. — BERNAMA