- 44% of them are driven by an increase in business opportunities
- Poor incentives/ low return on investment is key barrier to implementing sustainability
Although 95% of companies in Malaysia have established sustainability goals or targets, only half (49%) have implemented or are currently practising a comprehensive sustainability strategy. This is according to the Schneider Electric Sustainability Survey 2023 which covered about 4,500 business leaders from nine East Asia countries, including 500 respondents from Malaysia. The survey was conducted in partnership with Milieu Insight with the aim to identify the intention-action gap amongst companies. The other East Asia countries surveyed include Indonesia, Japan, South Korea, Philippines, Singapore, Taiwan, Thailand and Vietnam.
In Malaysia, the Green Action Gap – the metric used to estimate the rift between the perceived importance of sustainable goals and the tangible actions to implement sustainable development by companies – lies at 46%, highlighting the difference between companies who have established sustainability goals (95%) and those who have implemented or are currently practising a comprehensive sustainability strategy (49%).
Unsurprisingly, most business leaders in Malaysia (85%) believe that providing more incentives is more effective than enforcing penalties to encourage private sector compliance with government sustainability goals. The top reasons reported for pursuing corporate sustainability were increasing business opportunities (44%) as well as innovation and competitiveness (41%). Risk management, reputation and opportunity for cost-saving were also among the top five motivations for companies.
The survey also revealed that despite the vast majority of companies having sustainable goals in place, 74% of these goals are short-term, spanning the next four years or less. The findings suggest that companies may be more confident in setting detailed targets for the near future but struggle to turn broad sustainability plans into concrete actions until they approach the “deadline” for achieving these goals.
Eugene Quah (pic), country president for Malaysia of Schneider Electric said, “We are encouraged by the growing awareness and commitment among Malaysia’s companies to establish sustainability goals. However, the survey’s findings on the intention-action gap reveal that there is still work to be done, and this gap stands at approximately 46%. It is crucial for companies in Malaysia to translate their sustainability aspirations into tangible actions, addressing implementation challenges and embracing long-term strategies.”
“As we navigate the urgent need for sustainability, it is imperative for businesses to take a leadership role in driving change, collaborating with governments, and leveraging innovative solutions to create a more sustainable future for our country and the planet,” he added.