Protecting the Environment with Low-Carbon Economy by Malaysian Public Listed Companies

Carbon major companies are responsible for over 30% of global industrial greenhouse gas (GHG) emissions, and arguably control ‘the future of the planetary climate system’. Carbon major companies are producers of oil, natural gas, coal, and cement. A number of these entities are transnational, non-state actors.

Despite their tremendous contribution to global emissions, they are not regulated through stringent, top-down, transnational emissions limits, but are instead governed largely by disclosure-only requirements and market-based or voluntary corporate social responsibility (CSR) mechanisms.

The 12^th Malaysian Plan is the first plan that outlined the initiatives that will be taken by Malaysia in the low-carbon economy. Malaysia has set an ambition to be a carbon-neutral nation by 2050 by upgrading its Nationally Determined Contributions (NDC) target to reduce the intensity of GHG emissions by 45% by 2030 unconditionally and to have a net-zero emissions target by 2050 that was tabled at COP26.

The GHG emissions can be categorized into three main types – Scopes 1, 2, and 3. Scope 1 involves all direct emissions from the sources and activities that are controlled by the organization. These include fuel combustion on sites such as gas boilers, fleet vehicles, and air-conditioning leaks. Scope 2 involves indirect emissions from electricity purchased and used by the organization. These are essential emissions released during the generation of electricity and are eventually used by the organization. Scope 3 involves all other indirect emissions from sources and activities that are not controlled by the organization. These usually make up the largest share of an organization’s carbon footprint.

The Securities Commission (SC) found that PLCs are setting and committing to emissions reduction targets including achieving carbon neutrality by 2030 and net zero by 2050. This is based on the SC’s review of 50 PLCs that comprise, among others, large PLCs operating in the energy, plantation, and transportation and logistics sectors.

More than half of the PLCs are also disclosing emissions-related data even before the Bursa Malaysia Listing Requirements made the disclosure of such information mandatory. All PLCs are required to disclose emissions-related data in annual reports for the financial year ending 31 December 2024 and onwards.

Sime Darby Plantation Bhd’s current climate-related strategies include minimizing upstream operations GHG emissions (biogas plants, solar energy, operational efficiency), implementing nature-based solutions, eliminating deforestation within supply chains, and investing in Research & Development to boost yield and develop more resilient crops.

Axiata Group Bhd’s strategic approach toward managing carbon emissions involves enhancing internal mechanisms, controls, and reporting to ensure the robustness of data to formulate its carbon reduction targets. In 2021, Axiata established the Axiata Net-Zero Carbon Roadmap that is aligned with GSMA Zero by 2050.

Hence, developing a low-carbon economy by global, national, and local stakeholders are crucial in ensuring systematic decarbonization.