National ESG framework for manufacturing sector in the works
26 Aug 2022
The formulation of a national environmental, social and governance (ESG) framework for the manufacturing sector is in the works, in line with Malaysia’s net zero greenhouse gas emissions target by 2050, said Senior Minister and Minister of International Trade and Industry (Miti) Datuk Seri Mohamed Azmin Ali.
He said the ESG framework will be formulated based on consultation and engagement with local and international stakeholders involved in the manufacturing, regulatory and financial sectors.
“Miti will provide a framework to mainstream ESG elements for the manufacturing sector which will include four main components, namely ESG standards, financial support and incentives, capacity building, and market mechanisms including carbon trading and carbon pricing,” he said in a statement after Miti’s Dialogue Sessions on Aug 25, 2022.
The senior minister noted that the progress of the framework would be dependent on the level of achievement in engagement and collaboration with stakeholders.
“Along with the National Investment Aspirations (NIA) goals, Miti will intensify its focus on sectors such as the digital economy, electrical and electronic, pharmaceuticals, chemicals and aerospace that have significant economic potential and sustainable long-term benefits,” he said.
This annual dialogue series is an initiative by Miti based on a consultative approach with stakeholders towards holistic formulation and review of policies to drive the country’s economic growth via increased international trade, sustainable industrial development and quality investment.
The robust and fruitful dialogue sessions saw the participation of 12 ministries and 151 organisations.
Miti had received 96 memorandums covering 24 categories out of a total of 396 issues submitted along with motions for the government’s consideration.
On the challenges posed by the current geopolitical and geo-economic dynamics, Mohamed Azmin said: “Indeed, while global inflationary forces are beyond our control, it remains our resolve to ensure that we progress in terms of productivity and competitiveness.
“These are fundamental factors which we can rely on as long as we have the courage and conviction to succeed.”
In tackling the issue of foreign workers, the senior minister underscored the imperative for a long-term solution in order for the domestic industry to reduce and eventually eliminate its dependence on low-skilled labour.
He also urged the manufacturing sector, especially small and medium enterprises, to continue investing and adopting advanced manufacturing technologies to increase productivity and reduce the cost of doing business.
The senior minister assured dialogue participants that Miti will remain steadfast and fully committed to working together with the industry and entrepreneurs in addressing the challenges toward further strengthening Malaysia’s economic recovery and reinforcing the nation as a global trading powerhouse.
Some of the recommendations highlighted in the Miti Dialogue will be extended for the consideration of the Ministry of Finance in the formulation of Budget 2023.