Sime Darby Property ranked first in ESG initiatives for the RM1bil and above category. Photo shows township development chief operating officer Appollo Leong (second from left) receiving the MDA 2023 trophy from Deputy Local Government Development Minister Akmal Nasrullah Mohd Nasir as Star Media Group chief executive officer Alex Yeow (right) and FIABCI-Malaysia president Datuk Firdaus Musa (left) look on.

Sustainable practices have transitioned into crucial components

In today's global landscape, where challenges like climate change, social inequality and corporate governance are at the forefront, property developers are realising that they must adapt or risk becoming obsolete. Embracing sustainability in the form of environmental, social and governance (ESG) practices has transitioned from a mere buzzword to a critical component of a company's long-term strategy. And property developers that neglect ESG factors not only face reputational risks but also miss out on opportunities for growth and resilience.

Environmental responsibility is arguably the most visible aspect of ESG. Climate change and environmental degradation are no longer distant threats - they are happening right now. Customers, investors, and regulators are demanding action. Companies that take proactive steps towards reducing their carbon footprint, conserving resources, and adopting eco-friendly practices are not only contributing to a sustainable future but also appealing to an increasingly environmentally-conscious consumer base.

Property developers are now expected to take a stance on social issues, from diversity and inclusion within their workforce to ethical supply chain management. The events of recent years and the global pandemic have magnified the importance of social responsibility. Businesses that prioritise fair labour practices, community engagement and diversity are better positioned to weather societal shifts and maintain a positive brand image.

Effective governance and accountability are fundamental to a company's long-term success. Shareholders and stakeholders want assurance that their investments are in capable hands. Strong corporate governance practices ensure transparency, ethical decision-making, and the protection of shareholder interests. Companies with robust governance structures are better equipped to navigate crises and regulatory changes.

Emphasising on ESG is not just a matter of corporate social responsibility, it is a strategic imperative for long-term success. That is why the ESG attribute in the Malaysia Developer Awards has increased from 10% to 20%. To ensure as many areas are covered, the ESG criteria include:

• A Company Sustainability Plan and Policy implemented and Initiatives demonstrated by the company in responding to ESG 
• An outline of ESG initiatives and contributions: How it is being incorporated into the operation of the company and development projects undertaken by the developer. Project development that embed sustainability features:
  • Environment concerns like Green building, electric vehicle (EV) friendly, biodiversity (preservation of ecosystem) and smart water system that channels recycled water from rainwater harvesting and treated water. 
  • Social priorities on community programmes like health and safety, good access to public transport network with a covered walkway, free shuttle service or donations.
  • Governance with emphasis on high integrity and anti-corruption measures.
•  17 sustainable development goals (SDGs) 
• Compliance and score for the FTSE4Good Bursa Malaysia (F4GBM) Index
• Company’s stance and methodology towards achieving a carbon-free footprint
• Impact and benefits generated for various stakeholders  – communities, residents/ users, company, employees, partners and industry

TOTC quantitative rankings - ESG

In the RM1bil and above category, Sime Darby Property Bhd emerged as the clear leader in rankings, scoring 17.2 out of 20. In the below RM1bil, NCT Alliance Bhd narrowly beat Paramount Corporation Bhd by 0.1 with 15.4 out of 20 to take the pole position. 

Companies that incorporate ESG principles into their operations are better positioned to thrive in an evolving business landscape. From attracting investment to building customer loyalty, ESG is not just a checkbox but a powerful catalyst for growth and resilience. It is a reminder that success is not just about financial profits. As we look to the future, the emphasis on ESG will continue to grow and businesses that embrace it will be the leaders of tomorrow.

NCT Alliance executive director Yap Chun Theng and
director Sae-Yap Atthakovit giving the thumbs up.

Ranking by ESG initiatives

Ranking by ESG initiatives

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