More SMEs needed to strengthen Malaysia's sustainability push
By SUFEA SALEHUDDIN
SMALL and medium enterprises (SMEs) must play a greater role in driving Malaysia's sustainability efforts, particularly as global regulations tighten and demand for low-carbon products increases.
Natural Resources and Environmental Sustainability Minister Nik Nazmi Nik Ahmad said SMEs are essential to the nation's green transition, but face structural limitations that require targeted support.
'Many SMEs are still struggling to adapt to climate-related regulations. They do not have chief sustainability officers or dedicated compliance teams like public-listed companies,' he said at the launch of The Green Factory's flagship retail store at The Campus Ampang on Tuesday.
Nik Nazmi said the government is aware of these challenges and is working on multi-level initiatives to assist the sector.
He also urged large corporations, including government-linked companies (GLCs) and multinational corporations (MNCs), to take an active role in building capacity across their supply chains.
'We hope bigger companies that rely on SME suppliers will help them switch to more sustainable practices by offering guidance, training, and knowledge transfer,' he added.
He also said Malaysia's furniture sector, though facing a reduced local timber base, remains a strong contributor to exports and holds significant potential for green transformation.
'There is significant global demand for sustainable wood-based products, particularly from Europe. If we can position our SMEs to meet those standards, the economic benefits will follow,' he said.
Nik Nazmi cited The Green Factory as an example of SME-led innovation in the circular economy.
Originally a school furniture supplier, the company has grown into a sustainability-focused enterprise by upcycling timber waste into premium products, gaining international recognition in the process.
'This is a business that grew from a small workshop into a fully-fledged sustainability enterprise. It shows how local innovation, led by young people, can drive meaningful environmental change,' Nik Nazmi said.
He also pointed to emerging international frameworks such as the European Union Deforestation Regulation (EUDR) and the Carbon Border Adjustment Mechanism (CBAM), warning that Malaysian SMEs could face trade barriers if they are not adequately prepared.
'These policies are coming fast, and if we do not prepare our SMEs now, they will be disadvantaged. That is why we are calling for a whole-of-government and whole-of-supply-chain response,' he said.
Nik Nazmi added that public-facing initiatives such as 'Sustainaboleh!'—a sustainability programme held in conjunction with the launch—play a critical role in reshaping both public behaviour and industry practices.
'It is not just about policy— it is about making sustainability tangible and relatable to everyday Malaysians,' he said.
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Daily Express
20 hours ago
- Daily Express
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Advertisement Well known fact that Sabah's GLCs have: [1] Proliferated in number since the mid-1980s. [2] The increase in number has little economic logic or strategy. more for expediencies and political accommodation. Chairman appointments of big GLCs are special reserves for warlords. Senior management jobs for relatives and macai. [3] The number of GLCs has grown to more than 250. The Assistant Minister of Finance has confirmed this number in the press. [4] Big majority of GLCs have in total lost billions over the years, some are still heavily debt ridden, poorly managed and lack governance. [5] The GLCs have incurred huge liabilities for the many past lopsided agreements signed by GLCs and Malayan companies. [6] The GLCs have produced most failed and/or delayed JV projects with Malayan companies. There are 7 or 8 in KK alone as testimonies of the GLCs' failures. One GLC has failed to launch a major tourism project for more than 10 years. Sabah GLCs love Malayan companies, sideline Sabah companies. No love for 'Sabah for Sabahans.' They love 'Sabah for Malayans'. [7] Return on capital and assets are poor, mostly negative! [8]. The non-performing GLCs have not helped to build up Sabah's economy. Instead, they are destroying it. The GRS government, for the first time in Sabah's history, has initiated transformation after many public warnings by Hajiji and Masidi on the unsatisfactory and sad situation in the GLC. Already announced are these big moves. First, AG Brenndon and MOF Assistant Minister have confirmed the formation of the Oversight Committee. This is an important first step. Second, AG Brenndon has confirmed that all agreements to be signed by GLCs must be referred to and vetted by his Chambers before submission to the Cabinet. Knowing Brenndon, he would not tolerate any lopsided agreement at Sabah's expense. Many Sabahans are extremely concerned about the poor performance of GLCs. 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[2] GLCs are in effective control of many natural resources: mining/minerals [SMM], timber and FMUs [Innoprise, SOFODA]. [3] GLCs hold many monopolistic rights: Cement [Sabah Cement Industries], Ports [Suria, POIC Sandakan and POIC LD], Water [Jetama]. Fishing landing rights [SAFMA]. [4] GLCs have been granted practically free and extremely prime land, most of them at RM1,000 premium. [Innoprise, SUDC of SEDCO, Suria, SICC, Sabah Energy, TAED.]. [5] GLCs have been granted vast acreage of valuable agriculture land for free or at nominal premium. [Sawit Kinabalu, KPD, Sabah Softwood.] [6] GLCs have been granted cheap and valuable land for industrial park [KKIP, SOGIP, POIC Sandakan and POIC LD, ASEAN Supply Base in Labuan] [7] GLCs have been granted concession rights in oil and gas, river and sea sand [Sabah Energy, Sabah Gas, SMJ Energy, SEDCO]. 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Lo was a guest panel speaker at the NGO Sabar – Kopi Tiam Council podcast on 'Oversight & Reform of government-Linked Companies (GLCs) Transparency, accountability & Corruption Prevention session, recently. 'Most are either non-performing or underperforming,' Lo said and pointed out that GLCs hold many monopolistic rights for example, cement [Sabah Cement Industries], ports [Suria, POIC Sandakan and POIC Lahad Datu], water [Jetama] and fishing landing rights [Safma]. They have been granted very cheap but extremely prime land, most of them at RM1,000 premium. [Innoprise, SUDC, subsidiary of Sedco, Suria, SICC, Sabah Energy, TAED.]. Advertisement Others have been vast acreage of valuable agricultural land for free or at nominal premium. [Sawit Kinabalu, KPD, Sabah Softwood.] Then there are those who have been granted cheap and valuable land for industrial park [KKIP, Sogip, POIC Sandakan and POIC Lahad Datu, Asian Supply Base in Labuan] or granted concession rights in oil and gas, river and sea sand [Sabah Energy, Sabah Gas, SMJ Energy, Sedco]. GLCs are also into hotels, resorts and jungle resorts [Innoprise, Sedco and Sabah Air] or granted exclusive JV preference with Sabahan and non-Sabahan companies. 'Most significantly, many GLCs have become a huge liability and drag on Sabah's economic growth. Allowing GLCs to continue without proper governance will result in serious economic consequences. Sabah can never catch up,' he said. In most cases the political appointments of chairmen, board of directors and senior management have been inappropriate. 'GLCs are still bleeding losses year in year out. Sabahans are subsiding these losses that have easily run into billions the last 35 years. The accumulated losses are staggering,' he said. What is worse is that some of these GLCs have sold or entered into JVs in many valuable assets like prime commercial and agriculture land, buildings, monopolies and concessions, most of which are lopsided against Sabah. These GLCs have taken huge loans from the government and banks [especially SDB] that they cannot service or repay, often forcing Sabah taxpayers to bail them out. 'They enter into many lopsided JV agreements against the interests of Sabah. They have the greatest number of failed JV projects that need rescue by 'white knights'. 'These billions of dividends can be tax free and can transform Sabah's economic ownership back to Sabahans. The greatest impact is job creation. If each GLC, on average, can create an additional 100 jobs, there will be additional 25,000 jobs!' said Lo. 'This money could have been used for the hard-core poor, repair or investment in infrastructures, health, scholarships or to build two or three universities. 'The GLCs have many JV projects that are suspended or non-start for years.' 'SDB's revamp is showing encouraging results. Keep an eye on Sabah Energy as it will be the new performing star.' Lo was pleased that Chief Minister Datuk Seri Hajiji Noor has appointed suitable Sabahans to head some boards and management e.g. SDB, SMJ Energy, Sabah Energy, Sogip, Sogdc and the latest, a new Group GM for Sedco. Hajiji has appointed advisors on the economy, oil and gas, energy, tourism and international affairs. Notably, he said state Finance Minister Datuk Seri Masidi Manjun has appointed a task force on GLCs. Masidi has also appointed an oversight committee for GLCs. 'Hopefully, the revamp of GLCs will lead some of them to be listed on Bursa. Bursa will impose demanding and stringent governance requirements on these GLCs. 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BusinessToday
3 days ago
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Kenanga Investment Bank has reiterated its 'Neutral' stance on Malaysia's seaport and logistics sector following a mixed set of corporate earnings in the first quarter of 2025 (1QCY25), coupled with mounting global trade challenges. In its sector update, Kenanga noted that half of the companies under its coverage met expectations, while the other half underperformed. None beat forecasts, marking a deterioration from the previous quarter, where 25% exceeded estimates. Key Highlights: WPRTS (Westports Holdings Bhd) and POS Malaysia met expectations. Bintulu Port Holdings (BIPORT) and SWIFT Haulage disappointed. The sector was impacted by factors including irrational price competition in logistics, shifting global shipping alliances, and technical issues at LNG facilities. Company-Level Performance Westports Holdings (WPRTS) delivered results in line with expectations, supported by higher contributions from value-added and restow services linked to the Gemini Cooperation and Ocean Alliance. Despite softer container volume growth, the company expects value-added services to offset the decline. POS Malaysia's losses were anticipated, with some recovery in parcel and logistics volumes. However, the performance was dragged down by marine maintenance costs. The aviation segment, meanwhile, benefited from strong air freight demand. BIPORT underperformed due to reduced LNG production at the MLNG complex and a higher tax rate. Its 2QFY25 is expected to be weak due to a planned shutdown, although recovery is expected in 2HFY25. SWIFT Haulage posted disappointing results, pressured by startup costs for a new warehouse, loss of operational scale, and pricing pressures. The company saw margin compression despite gains in its freight forwarding segment, especially on long-haul routes. Global Headwinds and Local Resilience Kenanga cited trade disruptions from Red Sea diversions and geopolitical tensions as key headwinds. Global trade growth is projected to decline by 0.2% in 2025, revised down from +3.0% by the WTO, with only a modest recovery anticipated in 2026. However, Malaysia's external trade remains resilient, posting a RM12.6 billion surplus as of February 2025. Growth was supported by booming e-commerce, the global tech up-cycle (particularly AI-related demand), and frontloading activities amid US-China tariff negotiations. Emerging economies like Malaysia are also benefiting from trade diversion, positioning themselves as connecting economies between geopolitical blocs. Regulatory Risks on the Horizon Kenanga cautioned about upcoming carbon emissions regulations by the IMO and the EU's Carbon Border Adjustment Mechanism (CBAM), which could impact container volumes, especially on Asia-Europe routes. 'While the exact impact remains uncertain, containers bound for the EU—particularly those from China—will likely be affected,' the report stated. EU-bound trade makes up roughly 18% of container throughput in Asia-Europe lanes. E-Commerce to Fuel Domestic Logistics Kenanga remains constructive on the domestic third-party logistics (3PL) space, driven by Malaysia's e-commerce boom. The sector is expected to grow at a 7% CAGR from 2023 to 2027, reaching RM1.9 trillion. Growth drivers include just-in-time (JIT) delivery, reshoring, warehouse decentralisation, and cold-storage demand due to online grocery platforms. Despite global trade headwinds, Kenanga said Malaysia's logistics sector remains supported by structural growth trends and resilient export activity. The house, however, maintains a 'Neutral' outlook on the sector and does not name any top pick at this time.
