Malaysia unveils SDG Investor Map to champion ESG principles
20 Jun 2023
Malaysia, as part of its staunch commitment to the United Nations’ Sustainable Development Goals (SDGs), has introduced a large-scale and systematic plan to attain these goals and champion the environmental, social and governance (ESG) principles.
Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz said the Malaysia SDG Investor Map launched yesterday is an essential tool to foster collaboration and facilitate strategic investments aligned with the SDGs.
He said due to the expected tightening of global financing conditions, projections by United Nations Conference on Trade and Development and the International Monetary Fund suggest that the SDG financing gap could reach US$4.3 trillion (RM19.9 trillion) per year from 2020 to 2025.
“Where financing is likely to fall short, we need to push investments (both foreign direct investment and domestic direct investment) to help support SDG-focused projects.
“Globally, sustainable investing amounted to US$37.8 trillion (RM174.6 trillion) in assets under management (AUM) in 2022, with global ESG assets expected to exceed US$53 trillion (RM244.9 trillion) by 2025.
“This represents a significant increase from the US$22.8 trillion (RM105.3 trillion) in AUM at the beginning of 2016,” he said at the launch of the Malaysia SDG Investor Map here.
According to Tengku Zafrul, the SDG Investor Map represents one of Malaysia’s many efforts to place as many of the SDG goals as possible right, front and centre in the country’s policymaking efforts.
While the SDGs aim to address critical global socio-economic and environmental challenges, Malaysia, too, has made considerable policy efforts to support many of those goals, including climate change, pollution, biodiversity loss, poverty and hunger eradication, quality education and gender equality, he said.
Tengku Zafrul said the government recognises the importance of investments in driving sustainable growth and has incorporated initiatives aligned with the SDGs in its national development frameworks.
“For instance, under the New Investment Policy (NIP), a key priority is to introduce initiatives targeted at strengthening Malaysia’s foundations in adopting enhanced ESG standards, and cascading national-level targets into clear action plans and measurable milestones.
“The NIP also aims to attract high-quality investment, de-risk ESG factors and capture new growth opportunities,” said the minister.
Moving forward, he said, the Investment, Trade and Industry Ministry (Miti) will also launch the New Industrial Master Plan 2030 to reform the nation’s manufacturing foundation by enhancing the industrial ecosystem, underscored by key considerations such as ESG compliance and future industrial energy sufficiency.
“This is to enable us to, among others, achieve our net-zero target by 2050 as well as safeguard future economic security and inclusivity,” he said.
He pointed out that Miti is also drafting the National Industry Environmental, Social and Governance Framework (i-ESG Framework) for the manufacturing sector, which encompasses elements that contribute to the SDGs.
To be launched in September 2023, he said the i-ESG will comprise four key components – standards, financial support and incentives, capacity building and market mechanisms – to encourage the manufacturing sector to embrace ESG principles in their operations.
“The framework will include the SDG Investor Map as one of its programmes. As such, the SDG Investor Map is expected to be a vital tool that will attract investors to invest in SDG-aligned niche areas,” said Tengku Zafrul.