Session highlights growing role of Sarawak SMEs in driving state's sustainability, hydrogen ambitions
Dr Aaron Sum
KUCHING (May 13): Sarawak's small and medium enterprises (SMEs) are playing a growing role in driving the state's sustainability and hydrogen ambitions, with two-thirds already implementing environmental, social, and governance (ESG) practices.
Alliance Bank Malaysia Berhad group chief strategy and transformation officer Dr Aaron Sum said 62 per cent of SMEs surveyed indicated familiarity with ESG principles, signalling growing awareness and recognition of sustainable business practices.
'This is the first time we've had concrete data to gauge ESG maturity among Sarawak SMEs, and the momentum is very encouraging,' he said during a plenary session at the Hydrogen Economy Forum (H2EF) here today.
The research, conducted in collaboration with Alliance Bank, UN Global Compact, and Monash University, found that 44 per cent of SMEs have integrated ESG into their business strategies, while another 22 per cent have begun implementing ESG on an ad hoc basis.
Among non-adopters, 60 per cent plan to begin within two years, many driven by innovation and customer demand from overseas markets.
Sum underscored that Sarawak's hydrogen strategy is not only an energy transition but a broader ESG-led transformation.
'With 70,000 SMEs forming the economic backbone of the state, their participation is critical in ensuring a just and inclusive transition.'
However, he shared that key challenges remain as many SMEs still face obstacles such as limited funding, lack of technical expertise, and unclear or fragmented sustainability guidelines.
To address this, Alliance Bank has launched a simplified online ESG diagnostic tool in collaboration with UN Global Compact, providing tailored action plans and peer benchmarks for SMEs.
In addition, the bank has linked financing rates to a company's ESG maturity profile, offering more favourable terms to businesses demonstrating stronger climate performance.
'We've already deployed 50 per cent of our RM1 billion climate-inclusive financing allocation for Sarawak SMEs,' said Sum.
The study also identified key ESG focus areas for local SMEs, including waste management, resource efficiency, and digital governance.
He added that nearly half of respondents are also prioritising social responsibility efforts, and emphasised the importance of continued support, training, and capacity building to sustain the current momentum.
'This puts Sarawak on strong footing as we align economic growth with sustainable development,' he said. Alliance Bank Dr Aaron Sum hydrogen economy small and medium enterprises
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