What Malaysian Companies Need to Know About SDGs and Sustainability Policies

The United Nations established the Sustainable Development Goals (SDGs) to address pressing global issues like climate change, poverty, and inequality, aiming to create better lives for people everywhere. With 17 clearly defined goals, the SDGs serve as a blueprint for sustainable development that prioritises poverty eradication, environmental protection, and societal well-being. In Malaysia, the Sustainable Development Goals (SDG) Indicators Report, 2018 reflects the country’s progress toward achieving the 2030 Agenda. It highlights national initiatives aligning with the SDGs’ integrated approach to tackling poverty, fostering economic growth, improving social welfare, and protecting natural resources. This means prioritising education, health, social protection, and job creation while simultaneously addressing climate change and resource sustainability.

For Malaysian businesses, the Sustainable Development Goals underscore the importance of embedding sustainable practices into corporate strategies. By adopting Environmental, Social, and Governance (ESG) principles, companies can align their operations with these global goals. ESG helps businesses address social and environmental challenges while promoting long-term economic growth. In doing so, they don’t just contribute to national and global sustainability agendas—they also enhance their own resilience, strengthen stakeholder trust, and position themselves competitively in a sustainability-conscious market. 

In this article, we will explore the SDGs and Malaysia’s established sustainability policies through a business-focused lens and outline practical and actionable steps for Malaysian companies to align their operations with these goals.

What is SDG Malaysia and Why is it Important? 

Sustainable Development Goals (SDGs) are a universal framework adopted by Malaysia and 192 other nations in 2015 to address critical challenges such as climate change, inequality, and poverty while driving inclusive economic growth. With 17 Goals, 169 Targets, and over 200 Indicators, the SDGs are a roadmap for balancing economic, social, and environmental priorities. For Malaysia, specific goals like Climate Action (Goal 13), Responsible Consumption (Goal 12), and Decent Work and Economic Growth (Goal 8) stand out as crucial for ensuring resilience against environmental challenges and fostering fair economic progress. Prime Minister Datuk Seri Anwar Ibrahim, speaking at the Malaysia SDG Summit 2024, underscored the nation’s commitment, noting, “Malaysia is making significant strides in achieving Sustainable Development Goals (SDGs), having accomplished 43% of its targets, well above the global average of 17%.” 

This progress is not only shaping government policy but also aligning with investor priorities. Eco-conscious investors are increasingly focused on sustainable development and business practices, reflecting the government’s push toward eco-conscious growth. Additionally, this alignment has fueled a rise in eco-conscious consumers who actively seek out sustainable brands and hold businesses accountable for their practices.

For Malaysian companies, aligning with the SDG framework is a strategic move to position themselves as responsible and future-ready players in a sustainable economy. Businesses that integrate these principles into their operations strengthen investor confidence, boost their market competitiveness, and appeal to the growing segment of sustainability-driven consumers.

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Why SDGs Matter to Malaysia’s Economy and Environment

Malaysian companies must align with the SDGs. It is not only to improve their own economic resilience, but also to boost the international reputation of the country for sustainability. Malaysia has made great strides in this regard and has achieved some successes. However, it also faces some ongoing challenges like the promotion of inclusive economic growth, reducing carbon emissions and addressing the problem of deforestation. With the SDGs in place, the country is taking positive and proactive steps towards achieving its goals. 

Malaysia’s Sustainability Agenda: Policies and Frameworks 

To encourage alignment with Malaysia’s sustainability agenda, national frameworks offer grants, tax breaks, and other incentives to businesses. These benefits help offset operational costs and support sustainability investments for companies that follow the outlined frameworks.

The 12th Malaysia Plan (2021–2025)

The 12th Malaysia Plan, introduced in 2021, outlines the national agenda for sustainable economic growth and green development. It focuses on improving resource efficiency and driving environmentally friendly initiatives across Malaysia.

National Policy on Climate Change

The Malaysian National Policy on Climate Change promotes climate resilience by encouraging organisations to adopt advanced green technologies. This policy helps businesses mitigate environmental risks and adapt to changing climate conditions effectively.

Green Technology Master Plan (GTMP)

The Green Technology Master Plan (GTMP) positions Malaysia as a hub for green technology by prioritising sustainable infrastructure and renewable energy. This initiative lays the foundation for a low-carbon economy, driving innovation while fostering environmental resilience.

Economic MADANI

The Economic MADANI framework supports Malaysia’s socio-economic transformation by promoting sustainable and inclusive growth. It focuses on policies that address economic and social equity, ensuring progress benefits all segments of society.

Practical Steps for Malaysian Companies to Align with SDGs 

Businesses that are eager to embark on their own sustainability journey can benefit from some practical steps to enable them to adapt to Malaysia sustainable policies: 

Setting Up an SDG Strategy

The first step is to carry out a comprehensive analysis of the company’s SDG gap in order to pinpoint relevant goals. Once this has been completed, stakeholders must then be engaged to ensure they are in alignment with the company’s core values. 

10 Actionable Steps for Adapting to SDGs and Sustainability Policies

1. Set specific goals by establishing SMART goals (Specific, Measurable, Achievable, Relevant and Time-bound). These must align with the Sustainable Development Goal targets in Malaysia. 
2. Implement initiatives to increase energy efficiency and reduce the organisation’s energy consumption by adopting energy-efficient, upgraded equipment. 
3. Adopt practices to ensure greater sustainability in the supply chain by working in partnership with suppliers who are also committed to following sustainable practices. 
4. Embrace the principle of circular economy by minimising waste through recycling, reusing and designing products to be longer lasting. 
5. Put together an internal team dedicated to ESG and give them responsibility for advancing and monitoring sustainability initiatives. 
6. Carry out yearly sustainability audits to ensure progress tracking and compliance. 
7. Engage in programmes to support community welfare in alignment with social SDG goals. 
8. Create processes for more transparent reporting to meet the expectations of investors. 
9. Invest in sustainability employee training to build skills and greater awareness within the workforce. 
10. Consider options for green financing and access sustainable project funds such as those offered by MIDA. 

If you are uncertain of how to embark on your company’s ESG journey, reach out to the Elite Asia ESG experts who have the skills and expertise to guide you towards SDG alignment. 

Also Read:

Navigating Malaysia’s Green Taxonomy: A Pathway to Sustainable Development

The Benefits of Complying with Sustainability Policies in Malaysia 

Malaysian companies today should not only view compliance as meeting the regulatory requirements but also as a way of investing in their long-term resilience and success. 

Compliance brings a host of advantages such as: 

• Greater access to capital since companies that align with the sustainability standards have a greater chance of leveraging green financing and attracting investors who are more ESG conscious. 
• Cost saving thanks to sustainable practices such as waste reduction and energy efficiency that reduce operating costs. 
• Better brand image and a stronger reputation with improved loyalty from customers and the ability to attract top employee talent. 
• Long-Term Resilience with a greater ability to handle challenges such as environmental risks, market volatility and regulatory shifts. 

Meanwhile, failing to comply can bring some significant potential losses including: 

• Missed opportunities to benefit from green finance and incentives that are only available for organisations that pursue sustainable practices. 
• Damage to reputation by creating a negative perception of the brand amongst eco-conscious customers. 
• Greater regulatory pressure with potential fines, operational limitations and stricter regulations being introduced as policies change and evolve over time. 

It’s clear then, that companies that align with Malaysia’s SDGs and adopt sustainability policies can reap multiple benefits from their compliance, including enhanced resilience, an improved reputation and cost savings overall. 

If you’re ready to launch your company’s ESG strategy, the best place to begin is with an SDG audit, or by connecting with an Elite Asia’s ESG consultant who can help to create the most effective sustainability strategy for your company. Elite Asia is leading the way in the field, offering support that is tailored specifically for your company, allowing you to leverage resources such as green finance, and helping you to regularly assess your sustainability progress so you can remain on track with the sustainable policies in Malaysia.