THE Employees Provident Fund (EPF) has emerged as a trailblazer in Malaysia’s financial landscape by introducing its pioneering Sustainable Investment Stewardship Policy. This landmark initiative establishes EPF as the country’s inaugural institutional investor to formalise such a comprehensive framework.

The newly unveiled policy delineates the guidelines and procedures that EPF adheres to in promoting robust sustainability practices among its portfolio companies and external fund managers.

According to EPF officials, this stewardship initiative underscores their steadfast commitment to enhancing Malaysia’s retirement landscape by fostering enduring sustainable value.

“This aligns with the United Nations-supported Principles for Responsible Investment (PRI), which define stewardship as institutional investors using their influence to maximise overall long-term value,” it said.

EPF CEO Ahmad Zulqarnain Onn noted that sustainable investments are pivotal in driving sustained value creation for Malaysia.

“As responsible stewards of capital, EPF is dedicated to advancing these principles by systematically integrating environmental, social, and governance (ESG) factors into all investment decisions,” remarked Zulqarnain.

“This stewardship commitment accelerates the EPF’s progress towards achieving a fully ESG-compliant portfolio by 2030 and a climate-neutral portfolio by 2050.

“We aim to empower our investee companies and EFMs to generate positive societal and environmental impacts, keeping all stakeholders’ best interests in mind, while maximising portfolio-level risk-adjusted returns.”

As Malaysia’s largest institutional investor, EPF assumes a leadership role in catalysing the adoption of sustainable business practices across the Malaysian capital market.

Moreover, this influence extends through individual efforts and collaborative endeavours including active participation in platforms such as the Institutional Investors Council (IIC).

The EPF Sustainable Investment Stewardship Policy encompasses comprehensive approaches to key stewardship domains, including monitoring, engagement, and escalation strategies. These initiatives are designed to align companies with EPF’s sustainable investment criteria and enhance the management of material ESG risks and opportunities.

EPF’s stewardship philosophy revolves around four core activities: proxy voting, continuous monitoring, proactive engagement, and collaborative initiatives. These pillars underscore EPF’s commitment to driving positive change and ensuring long-term sustainability across its investment portfolio. - July 17, 2024

https://focusmalaysia.my/epf-sets-new-benchmark-with-sustainable-investment-stewardship-policy/