KUALA LUMPUR, Sept 27 (Bernama) — Malaysia has maintained its third ranking in the 2011 Asian Sustainability Rating (ASR) albeit registering a lower average score this year.
This year it scored an average 39 per cent from 42 per cent last year as the inclusion of new and poorly-performing companies held back Malaysia’s score and was enough to result in a decline in the average for the country.
However, with Bursa Malaysia expected to launch the Environment, Social and Government (ESG) Index by end-2012, this average is likely to improve.
The ASR is a proprietary set of 100 sustainability indicators, covering disclosures on the main elements of ESG risk, comprising 750 companies from 10 Asian countries selected according to free float market capitalisiation.
South Korean companies maintained its first position as they performed across-the-board with scores mostly markedly higher for environmental disclosure.
Thailand ranked number two, up by two positions from last year, while India fell two notches to number four, followed by Taiwan, Singapore, China, Indonesia, Hong Kong and the Philippines.
CSR Asia co-founder and chairman Dr Richard Welford said the Malaysian government continued to be the main driver for the corporate social responsibility agenda.
“We have the prime minister talking a lot about CSR and they are aware there is a role for the private sector to play in the development of their countries,” he told reporters on the sidelines of the CSR Asia Summit 2011.
Welford said there was tremendous growth among local companies in real interest of sustainable business practices.
He said construction companies started to deal with migration labour and foreign workers.
Palm oil companies have taken the lead in CSR and have inspired other businesses to do so, he said.
To increase awareness on CSR among local companies, the government needs to encourage private sector to play their role, he said.
“We need encouragement and a little bit of push, so I think it is important for the government to encourage us and I hope the government will talk more on CSR issues,” he said.
He said the government should not necessarily cut taxes to encourage social responsibility among companies as he perceived social responsibiliy was good for business and it was part of the company’s branding and reputation.
“Secondly, the government should ask companies to include their CSR activities in the annual report and with the launch of the ESG index next year, there’s a big drive for Malaysian companies because they don’t want to be out of that ESG index,” he added.