SME Corp Malaysia has introduced the ESG Quick Guide for MSMEs to support the implementation of environmental, social, and governance (ESG) practices among micro, small and medium enterprises (MSMEs). 

KUALA LUMPUR: SME Corp Malaysia has introduced the ESG Quick Guide for MSMEs to support the implementation of environmental, social, and governance (ESG) practices among micro, small and medium enterprises (MSMEs).

Launched by Deputy Prime Minister Datuk Seri Dr. Ahmad Zahid Hamidi following the National Entrepreneur and SME Development Council meeting on Feb 5 in Putrajaya, the guide aims to simplify the process of understanding ESG for MSMEs.

This initiative is part of the ongoing efforts by the Ministry of Entrepreneur and Cooperatives Development (MECD) and SME Corp to help MSMEs grasp the significance of sustainability and ESG practices.

SME Corp chief executive officer Rizal Nainy explained that the quick guide consists of eight straightforward steps to help businesses grasp the significance of ESG in their operations.

These steps include understanding ESG importance, setting objectives, identifying relevant ESG indicators, creating a sustainability action plan, and utilising a user-friendly template for ESG reporting.

"This gguide also lists 13 basic indicators that can be used by all MSMEs. The selection of indicators is based on the suitability and minimum requirements of MSMEs business operations across all sectors, entity type and firm size.

"Moreover, it also includes important indicators for business sustainability such as employee benefits, culture, risk management and data protection that are less practised by MSMEs", said Rizal.

Minister of Entrepreneur and Cooperatives Development Datuk Ewon Benedick emphasised the importance for MSMEs to integrate sustainability aspects or ESG adoption into their business operations.

It is becoming increasingly vital with the growing adoption of ESG practices by large corporations, multinational companies and government-linked companies.

"MSMEs that implement ESG practices will not only have a positive social and environmental impact, but also have the opportunity to be part of the supply chain due to the requirement of large firms for their suppliers to implement ESG practices

"The government with strong support from the corporate and private sector, is committed to continue assisting MSMEs in adopting ESG practices through this guide, which has been simplified specifically for MSMEs as well as aligned to various existing ESG guidelines by the Ministry of Investment, Trade and Industry, Bursa Malaysia and the Securities Commission," he added. -- Business Times