While Corporate Social Responsibility (CSR) is not compulsory in Malaysia despite Bursa Malaysia having a formal framework to govern it, more and more corporates here are moving towards it. This is especially true of companies who align their CSR goals with their areas of business.
Mainstream investors today are also increasingly looking to review CSR issues when analysing companies. In fact, a UN Environment Program Financial Initiative report concluded that investors were not only permitted to but also sometimes required to take such factors into account.
So given these requirements, what have we seen on the CSR scene in Malaysia? Have major corporates here successfully aligned environmental-related CSR with their business initiatives and how successful have they been in making a significant impact?
Saving and Rebuilding the Reefs
The oil and gas industry is one of the mainstays of national revenue in Malaysia, largely driven by Petroliam Nasional (PETRONAS). The majority of our oil reserves are located offshore, within our national maritime boundary and as such the oil and gas industry here is inherently tied to the coastal waters.
For years, trawl fishing has devastated the coral reefs off the Malaysian coast, destroying the habitats of numerous species. The trawl nets have also caught many of the endangered Hawksbill turtles, which thus do not make it to shore to lay their precious eggs.
As such, one of the initiatives by PETRONAS was the Biodiversity, Environment and Conservation (BEACON) project. This project was conceptualised in 2012 with an aim to conserve the marine life in Bintulu through proactive measures that protect and improve the reef ecosystem there. The BEACON Project’s multi-prong approach consists of the BEACON Reef Ball Project and the Conservation, Education, Promotion and Awareness (CEPA) Programme.
Led by passionate marine biologist James Anak Bali (pic), the Reef Ball project aims to deploy a total of 1,500 reef balls off the coast of Similajau National Park at a cost of RM4.6 million.
Made from cement with rough, sharp edges and weighing 2 tonnes each, the balls serve to encourage coral growth as well as rip up and tangle trawling nets. Each time trawlers drag and lose their nets here, it costs them about RM3,000-RM4,000 for repairs and replacements, so the commercial boats now stay away and enforcement is no longer needed.
Re-growing our Rainforests
Tropical deforestation is one of the most serious environmental issues that humanity faces today. While we cannot directly impact what is happening in other countries around the region, what we can do is look inwards.
Tropical forests are a hotbed for a plethora of living species both flora and fauna, and the loss of these forests will be devastating blow on biological diversity. Forests also act as carbon dioxide sinks, absorbing the poisonous gas and releasing life-giving oxygen back to the atmosphere.
Once destroyed, ancient rainforests may take centuries to regenerate naturally.
Recognising this, Mitsubishi started contributing to the regeneration of tropical forests since 1990. Workers gathered fallen seeds, over 200,000 seeds in the first year alone. The seeds were then grown into seedlings in pots. Over the next four years, Mitsubishi cultivated over 300,000 seedlings of 92 species were cultivated.
The first planting was carried out by around 1,200 people who were able to plant more than 6,000 young trees. Today, trees from that planting are more than 12 metres high with a total of 300,000 trees planted through this project.
Breathing Life Back into our Rivers
As one of the key boutique property developers today, Selangor Dredging Berhad (SDB) has always been innovative and concept-driven in its area of focus. At BY THE SEA, Batu Ferringhi, Penang (pic), the developer showed this by initiating a River Rehabilitation Project to clean up Sungai Satu, the river bordering part of BY THE SEA.
The project’s main objective was to enhance the ecological and economic sustainability and aesthetic value through natural elements. The system works on a 100% self-sustainable and completely environmental-friendly mechanism, which uses natural wetland plants & minimal machinery.
Through the natural removal of pollutants by wetland plants combined with cutting edge German bio-engineering technology, the system continuously treats and improves water quality. The rehabilitation system successfully transformed what was originally a Class IV upstream river quality into a Class II downstream river quality.
Returning to Society
At the end of the day, each of these companies plays a part in returning to society in different ways. Their goals as corporates are clearly laid out and it bodes well for the future that such initiatives are being carried out on an on-going basis. From environment to education, there are no efforts too small for corporates to help society at large.
To date, it is not compulsory for Bursa listed companies in Malaysia to carry out CSR activities. However, a good point to note is that it is specifically this group of companies who are in a position to do the greatest good.
As a last thought; India’s Companies Act 2013 put forth the requirement that companies – public or private – of a certain size should create a CSR Committee. This committee is to oversee the investment of at least two percent of pre-tax profit in social causes. As a result, to date around 8,000 companies in India put an estimated US$2 billion back into the community. This would be extremely beneficial in Malaysia for society at large.