As Malaysia accelerates its transition toward a sustainable economy, the adoption of Environmental, Social, and Governance (ESG) reporting is becoming increasingly critical. Recognizing the importance of corporate accountability and transparency, the Bursa Malaysia ACE Market-listed issuers will soon be required to comply with enhanced ESG disclosure regulations.
Starting in 2025, companies listed on the ACE Market must report on key sustainability matters, including anti-corruption measures, energy management, and data privacy. From 2026 onwards, these requirements will expand to include waste management, carbon emissions data, and transition strategies toward a low-carbon economy. These reporting obligations align with global sustainability frameworks and are part of Malaysia’s broader net-zero emissions strategy.
This structured approach ensures that businesses are well-prepared for the increasing demands of investors, regulatory bodies, and international markets, reinforcing Malaysia’s position as a key player in ESG compliance.
Mandatory ESG Reporting Requirements for ACE Market Companies
1. ESG Disclosures Effective from 2025
Beginning in 2025, all ACE Market-listed issuers must disclose critical sustainability information related to:
- Anti-Corruption Measures – Demonstrating ethical business practices, corporate governance structures, and transparency in financial transactions.
- Energy Management – Reporting on efforts to reduce energy consumption, improve efficiency, and transition to renewable energy sources.
- Data Privacy and Security – Ensuring compliance with data protection laws and implementing robust cybersecurity measures.
These initial reporting requirements aim to increase transparency, mitigate risks, and promote responsible corporate behavior, helping companies build investor confidence and enhance their reputation.
2. Expanded ESG Reporting Obligations from 2026
From 2026 onwards, ACE Market-listed companies will be required to expand their ESG disclosures to cover additional sustainability aspects, including:
- Waste Management – Implementing sustainable waste reduction strategies and improving resource efficiency.
- Carbon Emissions Data – Measuring, tracking, and reporting greenhouse gas (GHG) emissions to align with Malaysia’s decarbonization targets.
- Transition Plans Toward a Low-Carbon Economy – Outlining long-term sustainability strategies, including net-zero commitments and green business initiatives.
This progressive implementation provides businesses with a structured approach to ESG adoption, allowing them to adapt to regulatory changes while developing comprehensive sustainability strategies.
Why These ESG Disclosures Matter
1. Strengthening Corporate Accountability and Investor Confidence
As global investors increasingly prioritize ESG compliance, companies that demonstrate transparent sustainability practices are more likely to attract investment and gain a competitive edge. Enhanced ESG disclosures will enable investors to assess corporate sustainability risks, fostering greater trust and long-term value creation.
2. Aligning with International ESG Standards
Malaysia’s new ESG reporting requirements align with internationally recognized frameworks such as:
- Task Force on Climate-related Financial Disclosures (TCFD)
- Global Reporting Initiative (GRI)
- Sustainability Accounting Standards Board (SASB)
By adhering to these standards, businesses can enhance their global competitiveness and facilitate cross-border market access.
3. Supporting Malaysia’s Net-Zero Commitments
With the government’s ambitious target of achieving net-zero emissions by 2050, these ESG regulations play a crucial role in driving corporate contributions toward climate action. Mandatory carbon emissions tracking and low-carbon transition plans will ensure that businesses align with Malaysia’s National Energy Transition Roadmap (NETR) and the Paris Agreement.
4. Future-Proofing Businesses Against Regulatory Risks
The global regulatory landscape surrounding ESG is evolving rapidly. Companies that proactively integrate sustainability practices into their operations will be better positioned to:
- Comply with future ESG regulations both locally and internationally.
- Mitigate financial and reputational risks associated with non-compliance.
- Enhance stakeholder engagement by demonstrating a commitment to long-term sustainability.
Conclusion
The introduction of enhanced ESG reporting requirements for ACE Market-listed issuers marks a significant milestone in Malaysia’s commitment to sustainability and corporate responsibility. These regulations will drive greater transparency, stronger governance, and a more structured approach to ESG integration across industries.
As Malaysia moves towards a greener and more resilient economy, companies that embrace ESG reporting will benefit from increased investor confidence, improved regulatory compliance, and long-term business sustainability. By aligning with global sustainability standards, businesses can strengthen their market position while contributing to Malaysia’s broader climate and economic transformation goals.
Source: Zuno Carbon – ESG in Malaysia
