The Edge Malaysia ESG Awards 2026 recognises growing ESG adoption

KUALA LUMPUR, 27 AUGUST 2026 —

Malaysian Public-Listed Firms Show Stronger ESG Commitment as Awards Expand Coverage

The assessed universe for 2026 now includes 1,003 PLCs, up from 956 in 2025, driven largely by the inclusion of ACE Market issuers, according to Bursa Malaysia Bhd. The weighted average FTSE4Good ESG score of Malaysian PLCs also rose to 2.72 as of June 2026, from 2.50 a year earlier, indicating broader adoption and deeper commitment to sustainability.

“The past year has been challenging, with economic uncertainty, geopolitical tensions and an energy crisis,” said Datuk Ho Kay Tat, publisher and group CEO of The Edge Media Group. “Yet, business leaders have remained committed to ESG, using it to understand long-term risks and opportunities and build resilience.”

The awards, organised by The Edge Malaysia in partnership with Bursa Malaysia and FTSE Russell, with Morningstar and Deloitte as knowledge partner and auditor respectively, will culminate in a gala dinner in September. UOB serves as the main partner, while Artelia sponsors the winners’ trophies.

Bursa Malaysia itself has set a benchmark, becoming the first Malaysian PLC to achieve the highest FTSE4Good ESG score of 5.0 in 2026. “Sustainability is not a separate agenda but an integral part of effective governance, risk management and long-term value creation,” said Datuk Fad’l Mohamed, CEO of Bursa Malaysia.

The expansion of ESG eligibility reflects a deliberate shift in Malaysia’s capital market. In 2022, only FBM EMAS constituents had FTSE ESG scores and were eligible for the awards. Coverage was later extended to Main Market PLCs in 2023 and to ACE Market PLCs in 2025. This year’s inclusion of ACE Market issuers has broadened participation.

Performance data shows clear progress. The number of Main Market PLCs achieving a Four-Star ESG rating (scores between 3.7 and 5.0) rose 65.9% year-on-year to 146 in June 2026, while their average ESG score improved by 9.1%. Among ACE Market issuers, the number of PLCs with a Three-Star ESG rating (scores between 2.5 and 3.6) increased 85.7% to 78, with average scores up 11.6%.

To qualify for high scores, companies must disclose data on energy use, supply chains, governance and workforce practices. “The key is materiality,” said Fad’l. “Companies should focus on sustainability issues most relevant to their business model and long-term strategy. Resources should be directed to areas that drive performance and long-term value.”

UOB Malaysia CEO Ng Wei Wei echoed this view, emphasising the link between sustainability and business resilience. “ESG is no longer just corporate responsibility—it’s a business imperative,” she said. “Companies that delay their sustainability transition may face challenges in financing, supply chain access and investor confidence.”

The urgency has been underscored by recent global disruptions, including conflicts that exposed energy and supply chain vulnerabilities. Many Malaysian firms are accelerating investments in renewable energy, resource efficiency and operational resilience, integrating ESG into core business strategy.

This global trend is reflected in investor behaviour. According to FTSE Russell’s 2025 Global Asset Owner Survey, 73% of asset owners continue to incorporate sustainability into investment strategies despite market headwinds. “Financial performance and risk management are now the primary motivations,” said Carmen Leung, head of sustainable products for Asia-Pacific at FTSE Russell. “Sustainability is increasingly viewed as a tool for managing long-term risks and identifying opportunities.”

She added that the next phase of ESG will focus not only on emissions targets but also on energy cost management, climate adaptation, supply chain resilience and evolving stakeholder expectations.

While sustainable and responsible investment (SRI) funds have faced headwinds globally, there are signs of recovery. Global sustainable funds attracted US$3.5 billion in net inflows in Q1 2026, following outflows in the previous quarter, according to Morningstar. However, recovery has been uneven, with outflows persisting in the US and Asia ex-Japan.

“Investors are now paying closer attention to investment fundamentals and portfolio quality,” said Nicolas Gisbert, head of sales for Southeast Asia at Morningstar. “They want evidence of long-term value creation, risk management and credible sustainability outcomes—not just an ESG label.”

Malaysia’s Islamic finance sector presents a strategic opportunity, Gisbert noted. The Securities Commission Malaysia’s SRI Taxonomy already links sustainable investing with shariah principles, but the approach remains underutilised. He suggested Malaysia could learn from Thailand by introducing demand-side incentives such as tax benefits for qualifying ESG funds and minimum holding periods to encourage long-term investment.

The Edge Malaysia ESG Awards use FTSE4Good’s ESG ratings model, which evaluates 14 themes supported by over 300 indicators. All Malaysian PLCs on the Main and ACE Markets are automatically scored by FTSE; no application is required. Only funds listed under the SC’s SRI framework are eligible for the funds category.

As the awards approach, industry observers see them as a catalyst for further ESG integration. “By recognising companies that set benchmarks for responsible business practices, the awards elevate the national ESG agenda,” said Ng Wei Wei of UOB Malaysia.

With Malaysia’s corporate sector increasingly aligning sustainability with long-term value creation, the 2026 awards may mark a turning point—one where ESG is no longer optional, but essential to competitiveness and resilience in an uncertain world.

Related: Kuala Lumpur