ESG developments to watch out for

Sep 29, 2025

6 min read

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WHAT'S COMING UP

① NATIONAL ESG STRATEGIC PLAN

Prime Minister Datuk Seri Anwar Ibrahim announced that the plan was agreed upon during the National SDG Council Meeting on Dec 18, 2024
It is meant to bring Malaysia's business entities towards ESG compliance and reporting in phases, especially for small and medium enterprises
In charge: Ministry of Economy
Status: Expected to be launched in late 2025, currently, it is unclear how it will be different from existing roadmaps and plans

② NATIONAL CLIMATE CHANGE BILL

Among other things, the bill:
- Sets national targets for greenhouse gas (GHG) emission reductions
- Establishes a regulatory entity to enforce requirements under the legislation
- Sets up a national Integrated climate data repository
- Establishes a National Climate Fund to support climate change Initiatives
- Mandates reporting of GHG emissions and other data to support Malaysia's International reporting obligations
- Enables carbon trading via a domestic emissions trading scheme (ETS)
In charge: Ministry of Natural Resources and Environmental Sustainability (NRES)
Status: Originally planned to be tabled in August 2025

③ CARBON TAX

The government plans to Introduce a carbon tax for Iron, steel and energy industries by 2026, as announced In Budget 2025
In charge: Ministry of Finance
Status: No details yet, but it will have to be aligned with the Emissions Trading System under the Climate Change Bill

④ NATIONAL ADAPTATION PLAN

The plan will enhance Malaysia's resilience to climate change impacts
In charge: Ministry of NRES
Status: To be completed In 2026

⑤ EXTENDED PRODUCER RESPONSIBILITY (EPR) POLICY FRAMEWORK

The National Circular Economy Council approved In principle the framework in May, Including the mandatory implementation of eco-design
The EPR will alleviate the government's financial burden In handling solid waste by shifting the responsibility to collect recyclables to businesses, who are also lncentivised to use more sustainable designs and materials
In charge: Ministry of Housing and Local Government
Status: The mandatory scheme is supposed to start In 2026

WHAT'S ALREADY OUT

① NATIONAL ENERGY TRANSITION ROADMAP

One of the most cited roadmaps, It was released In 2023 and charts the path for Malaysia to transition from a traditional fossil fuels-based economy to a high-value green economy
Aligns with the National Energy Policy 2022-2040
Flagship projects cover energy efficiency (EE), renewable energy (RE), hydrogen, bioenergy, green mobility, and carbon capture, utilisation and storage (CCUS)
In charge: Ministry of Economy

② NEW INDUSTRIAL MASTERPLAN (NIMP) 2030

Released in 2023, one of its Identified missions is to push for net zero by 2050 and decarbonise the manufacturing sector
The decarbonisation pathway includes the use of RE and energy storage, EE, electrification of processes, utilisation of sustainable raw materials, recycle and reuse waste, and CCUS
In charge: Ministry of Investment, Trade and Industry (Miti)

③ NATIONAL SUSTAINABILITY REPORTING FRAMEWORK (NSRF)

Launched In 2024, the NSRF serves to Improve the state of sustainability disclosures in Malaysia and standardise the reporting format, using the IFRS Sustainability Disclosure Standards as the baseline
It also extends mandatory reporting to large non-listed companies. Prior to this, It was only required for public-listed companies under Bursa Malaysia's listing requirements
In charge: Advisory Committee on Sustainability Reporting

④ LONG-TERM LOW EMISSIONS DEVELOPMENT STRATEGY AND NATIONALLY DETERMINED CONTRIBUTION (NOC) ROADMAP

Published earlier this year, the documents, which are submitted to the United Nations, provide a high-level outline of Malaysia's path towards Its net zero by 2050 goal and the NOC target of reducing 45% emissions Intensity by 2030
In charge: Ministry of Natural Resources and Environmental Sustainability (NRES)

⑤ NATIONAL CLIMATE CHANGE POLICY 2.0

The policy document Is the authoritative source for the government to develop regulatory Instruments like the Climate Change Act and economic instruments like carbon taxes
It has five strategic thrusts, 15 strategies and 92 key actions
In charge: Ministry of NRES

⑥ CIRCULAR ECONOMY BLUEPRINT FOR SOLID WASTE (2025-2035)

Launched In 2024 and Includes strategies like the EPR and zero-waste-to-landfill certification, covering five strategic pillars and 20 initiatives
In charge: Ministry of Housing and Local Government

⑦ CIRCULAR ECONOMY POLICY FRAMEWORK FOR THE MANUFACTURING SECTOR IN MALAYSIA

Launched In 2024, It Is to guide the evolution of circularity In the manufacturing sector, aligned with NIMP 2030. It has four key themes and 14 initiatives.
In charge: Miti

⑧ CCUS ACT 2025

Passed In parliament earlier this year, the Act establishes a legal framework for the capture, transport, reuse and storage of carbon dioxide
In charge: Ministry of Economy

⑨ WATER SECTOR TRANSFORMATION 2040

Published In 2024, the agenda alms to strengthen the water sector via four phases under the 12th to 15th Malaysia Plans. The main objective is to ensure water security and sustainability, and transform water into an economic opportunity.
In charge: Ministry of Energy Transition and Water Sustainability

Compiled by Tan Zhai Yun
Infographic by Nurul Aida Mohd Noor
Source: ESG developments to watch out for (29 September 2025), The Edge Malaysia Newspaper. p. E10.

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ESG developments to watch out for

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