Malaysia is making significant strides in strengthening its ESG governance and carbon neutral strategy, positioning itself as a leader in Southeast Asia’s sustainability transition. According to Dr. Gary Theseira, chairman of the Climate Governance Malaysia (CGM) Council, the country’s renewed climate strategy focuses on sector-specific emissions cuts, financial innovation, and regional policy alignment. 

The energy sector—responsible for over 79% of national greenhouse gas (GHG) emissions—is a top priority under the National Energy Transition Roadmap (NETR). This roadmap outlines a shift from fossil fuels to renewable energy sources like hydro, solar PV, biomass gasification, and Ocean Thermal Energy Conversion (OTEC), while encouraging “behind-the-meter” solar solutions to reduce national grid demand. 

Malaysia’s carbon neutral strategy also includes the protection of natural carbon sinks. The Land Use, Land Use Change and Forestry (LULUCF) sector currently offsets over 212 million tonnes of CO₂-equivalent annually through forest and green space preservation, essential for climate resilience. 

Crucially, the country is also empowering small and medium-sized enterprises (SMEs) to contribute to ESG transparency. Through simplified tools like the ESG Disclosure Guide and GHG Protocol, SMEs are becoming active contributors to Scope 3 emissions reporting under the National Sustainability Reporting Framework (NSRF). 

However, Dr. Theseira highlighted persistent challenges around green finance, particularly private sector reluctance due to unclear policies and weak ecosystem support. He urged the government to prioritize measurable sustainability-linked loans, enhance anti-greenwashing standards, and create a bankable pipeline of transition projects such as grid upgrades and critical mineral investments. 

With Malaysia chairing ASEAN and aiming for 70% renewable energy and net-zero by 2050, the upcoming National Climate Governance Summit 2025 is expected to further drive transition finance and harmonized regional standards—paving the way for a more sustainable, competitive, and carbon-resilient future. 

Source: 

https://thesun.my/business-news/gary-HE14013253