Malaysia sees higher ESG adoption among property companies, says MBSB Investment Bank

• Property companies are also incorporating sustainable design into their project planning by allocating a certain percentage of open green areas within developments and applying for green certifications, such as GreenRE or the Green Building Index (GBI).

KUALA LUMPUR (Aug 14): Property companies in Malaysia have increased their adoption of environmental, social and governance (ESG) practices, driven by growing concerns over such issues and reflecting their commitment to sustainability, said MBSB Investment Bank.

In a research note, the investment bank stated that ESG practices have their benefits, including lower energy consumption, reduced resource waste, and lower operating costs.

“ESG adoption is also a risk management process that looks beyond financial risks and manages the risks and opportunities,” it said.

Property companies are also incorporating sustainable design into their project planning by allocating a certain percentage of open green areas within developments and applying for green certifications, such as GreenRE or the Green Building Index (GBI).

It said most developers are leveraging renewable energy by installing solar panels to reduce greenhouse gas emissions, incorporating rainwater harvesting systems, installing LED lighting and providing electric vehicle charging stations.

Beyond profit-maximisation incentives, MBSB Investment Bank said developers also have the important mission of building quality homes to improve people’s living standards.

The report said developers are adopting more robust ESG practices to align with stakeholder expectations, with the FTSE4Good Bursa Malaysia Index a key benchmark for ESG ratings. It expects deeper ESG integration principles in investment decisions and operations among property companies.

Mah Sing Group, Sunway Bhd, Eco World Development Group Bhd and IOI Properties Group Bhd lead in ESG adoption through sustainable design and the use of renewable energy.

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