KUALA LUMPUR (June 21): The Centralised Sustainability Intelligence (CSI) Solution launched by Bursa Malaysia Bhd (KL:BURSA) on Friday will enable companies to improve their climate disclosures and benefit from special funding rates for decarbonisation initiatives from financial institutions.

The CSI Solution was developed over a year ago in collaboration with the London Stock Exchange Group to help companies measure, estimate and disclose carbon emissions via a single platform. The disclosures are aligned with local and global frameworks, including that of the International Sustainability Standards Board.

“Our aim is to assist businesses to focus on ESG metrics that should be reported, analysed and managed,” said Bursa Malaysia chief executive officer Datuk Muhamad Umar Swift at the launch event.

The CSI Solution is available for companies of all sizes, including small and medium enterprises (SMEs). Large companies can use the platform to support and manage the emissions profile of their suppliers, as part of their Scope 3 emissions accounting.

Companies with good climate disclosures that are aligned with global standards stand to be more competitive in the global market.

“By fostering innovation, collaboration and technological advancement, Malaysia is not only striving for sustainable economic growth but also positioning itself as a regional leader in industrial reforms, which will ensure a more resilient manufacturing and business landscape,” said Minister of Investment, Trade and Industry Tengku Datuk Seri Zafrul Abdul Aziz during his keynote speech.

The CSI Solution can support the goals of the New Industrial Master Plan 2030, the National Energy Transition Roadmap and the recently released National Semiconductor Strategy, said Tengku Zafrul, for which sustainability, and environmental, social and governance (ESG) factors are important.

Companies that want to use the CSI Solution can leverage the Domestic Investment Accelerator Fund (DIAF) for ESG Adoption from the Malaysian Investment Development Authority.

“This is actually a matching grant for ESG transition in the manufacturing and services sectors, given on a matching basis, ratio of around 50:50 or 70:30, with the maximum reimbursable amount of RM500,000 per company. You can use this for the CSI [Solution], obviously. I’m pleased to announce that SMEs that fulfil their ESG disclosures will be eligible for consideration of this DIAF grant,” said the minister.

Special funding rates by the CSI Solution’s banking partners are available for companies and their suppliers. Alliance Bank Malaysia Bhd (KL:ABMB) committed to provide RM1 billion of green receivables financing and lower financing rates of up to 300 basis points for companies that improve their sustainability disclosure and performance on the platform.

“Participating corporates will also get to enjoy extended payment terms while decarbonising their supply chain and working on their Scope 3 requirements. Aside from that, SMEs will be able to access our SME Impact Programme, which has additional resources such as capacity building tools and training,” said Alliance Bank Malaysia group CEO Kellee Kam.

Measuring and disclosing carbon emissions according to international reporting frameworks is especially important for Malaysian companies that are part of the global supply chain.

Muhamad Umar highlighted the European Union's (EU) Corporate Sustainability Reporting Directive - which will impact companies that generate a certain amount of revenues from the EU - as an example.

Tengku Zafrul, meanwhile, highlighted the EU’s Carbon Border Adjustment Mechanism (CBAM), which imposes a price on imported carbon-intensive products into the region.

“Market-related moves such as the EU CBAM began its transitional phase last October, requiring EU importers of carbon-intensive goods to submit quarterly reports on the embedded emissions of these goods,” said the minister. The full implementation will take place in 2026.

Aside from non-tariff trade barriers like the CBAM, disclosing ESG data can help companies and investors from other countries, said Muhamad Umar.

To enable the flow of ESG data across the region, Bursa has inked a memorandum of understanding with the Indonesia Stock Exchange, the Stock Exchange of Thailand and the Singapore Exchange to form the Asean-Interconnected Sustainability Ecosystem.

“Through this initiative, we will be able to promote ESG performing companies’ potential, thereby facilitating seamless cross-border trading and investment opportunities for Malaysian companies among Asean investors,” said Muhamad Umar.

The Early Adopter Programme for the CSI Solution included corporations in various sectors and financial institutions. These companies include UMW Holdings Bhd and Malayan Banking Bhd (KL:MAYBANK) for the automotive sector, Petronas for oil and gas, Mah Sing Group Bhd (KL:MAHSING) and Alliance Bank Malaysia for the property sector, Westports Holdings Bhd (KL:WPRTS) and OCBC Bank for logistics and transportation, and Malaysia Steel Works (KL) Bhd (KL:MASTEEL) for the construction sector.

https://www.theedgemarkets.com/node/716274