ESG

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

TAIPEI: Boasting the world’s largest production of food-grade recycled polyester, FENC oversees a seamlessly integrated production and sales system spanning from recycled feedstock to end-product applications. Through FENC’s vast recycling capacity, FENC recycles over 22 billion pieces of post-consumer recycled polyethylene terephthalate (PET) bottles into high-quality sustainable products. The company creates value from waste, repurposing the bottles into food and non-food packaging, hygienic materials, automotive textiles, home furnishings, sports apparel, footwear and more. Partnerships with world-class brand clientele like Coca-Cola, Pepsi, Suntory, Fiji Water, F&N, Asahi, L’Oreal, Unilever, P&G, Nike, adidas, and lululemon are testaments to both the company’s cutting-edge recycling technology and its unwavering commitment to the circular economy. FENC’s footprint in recycled polyester production stretches across Taiwan, Mainland China, Japan, the US, and Southeast Asia. To bolster its leadership and propel the polyester sector towards greener pastures, FENC is actively expanding its capacity for high-value food-grade recycled polyester. Notably, the newly inaugurated Kansai plant in Japan, complementing the existing Kanto facility, is poised to solidify FENC’s dominance in Japan’s recycled polyester market. Furthermore, the imminent launch of Vietnam’s recycling plant in the latter half of 2024 not only contributes to local recycling infrastructure but also advances Vietnam’s circular economy agenda. Meanwhile, in Malaysia, FENC broke ground on an expansion project for its recycled polyester factory in Melaka. Scheduled for production by the end of 2025, this expansion will create a fully integrated upstream-downstream operation with the existing bottle manufacturing plant, thus enhancing value creation along the supply chain. Across the Pacific, FENC’s US plant completed its capacity expansion in the first half of 2024, injecting renewed vitality into the nation’s circular economy. For over three decades, FENC has championed the circular economy. With agile production and sales strategies, it has secured regional supply chain advantages within the recycled polyester sector, fostering sustainable development across the industry landscape. In 2023, FENC earned widespread acclaim for its exemplary Environmental, Social, and Governance (ESG) performance, topping the Minderoo Foundation’s global plastics circularity evaluation, ranking among the top 2.5% in the global chemical industry according to Sustainalytics’ ESG risk ratings, and securing a spot in the top 5 of Taiwanese listed companies in FTSE Russell’s ESG Ratings.

KUALA LUMPUR: Impact-based foundation of Khazanah Nasional Bhd, Yayasan Hasanah launched its 10th edition of The Hasanah Report (THR) 2023, revealing a total of RM223 million worth of funds disbursed in 2023 with a reach of 2.9 million people in Malaysia across all layers of society. According to the report, a total of RM1.6 billion worth of funds have been disbursed to date since 2015, across core areas of education, community development, arts, heritage and culture (AHC) as well as environment and knowledge. The report marks a decade of Yayasan Hasanah being the leading foundation in Malaysia’s philanthropic sector, going beyond charity but anchored in the concept of social justice for the rakyat. “When we look back at the milestones achieved by our partners, a unifying theme emerged: the inspiring stories of trailblazers, stereotype-breakers and courageous dreamers. These are the people who are forging new possibilities and shaping our collective future narrative, which is what inspired the theme of our report this year of ‘Reinventing our Future: Harapan Tanpa Sempadan’,” said Yayasan Hasanah Trustee and Managing Director Dato’ Shahira Ahmed Bazari. In the report, Hasanah highlighted one of the many livelihood programmes supported by the Ministry of Finance, namely the Blind Planters Programme in Terengganu which offers training for visually impaired individuals to become planters, cultivating the Terengganu Sweet Melons to generate income, successfully harvesting a collective total of 387kg of the fruit to date. This initiative not only challenges the stigma surrounding blindness but also broadens the horizons of career options for the visually impaired as well as inspiring new perspectives in empowering other vulnerable communities, especially the B40 community. The foundation also recognised the exponential growth of numerous community leaders who have emerged through programmes supported by Hasanah, such as the Temiar Orang  Asli community in Perak, who – with the leadership of the Tok Batin – have transformed their village into an ecotourism destination, creating sustainable income opportunities, generating close to  RM 40,000 in revenue within seven months from its launch. Within the environmental sector, Hasanah has been steadfastly supporting Roots & Shoots Malaysia since 2019 which began with a handful of dedicated youth volunteers and has grown into a movement empowering 317 young individuals. The volunteers are allowed to collaborate with a diverse array of NGOs, amplifying their impact and contribution to environmental causes. Emphasising the power of the Public-Private-Philanthropy partnership model, Shahira added, “We’re excited to see the involvement of youth across various impact areas – from education to community development – underscoring their potential to shape Malaysia’s future.”