Malaysia’s business regulators are strong advocates of sustainability and are working together to build climate resilience in the financial sector, says Errol Oh
This article was first published in the November/December 2019 China edition of Accounting and Business magazine.
When I first picked up a copy of JRR Tolkien’s The Lord of the Rings many years ago, the thing that immediately caught my attention was this Sunday Times review quote on the cover: ’The English-speaking world is divided into those who have read The Hobbit and The Lord of the Rings and those who are going to read them.’ More than just a clever way to praise the book, the quote made me realise that there are infinite ways to categorise people.
A line separating one group from another can be trivial, skin-deep and arbitrary. But there are times when it makes a huge difference.
For example, many of us know enough about climate change to be worried about the future of the planet, yet there are others who swear by global warming conspiracy theories.
What if the latter group is wrong and the price of denial is tragically high? Our best hope is that the former category is packed with the right people – the ones with authority and competence – and they are working hard to address climate change. This is why it is encouraging to see that Malaysia’s business regulators are strong advocates of sustainability.
Bank Negara organised a three-day regional conference on climate change in September. In her keynote address, Bank Negara governor Datuk Nor Shamsiah Mohd Yunus explained why climate change matters for the economy and for financial institutions, and how the financial sector can contribute towards building climate resilience.
When a central banker gives a speech on climate change, especially at a time when at least one powerful world leader blithely plays down the threat, it does not hurt to listen.
‘Climate change poses risks to the fiscal position of governments, the viability of businesses and the living standards of individuals,’ said Nor Shamsiah. ‘As such, the effects of climate change are not merely an ecological problem for scientists and conservationists to worry about. It presents a major economic issue with direct implications on financial stability.’
On the final day of the conference, the central bank announced the formation of the Joint Committee on Climate Change to ‘pursue collaborative actions for building climate resilience within the Malaysia financial sector’.
There is growing emphasis on sustainability in the capital markets as well, and this encompasses climate change. For example, companies listed on Bursa Malaysia are required to prepare Sustainability Statements covering the companies’ management of material economic, environmental and social risks and opportunities.
The ASEAN Capital Markets Forum – the Securities Commission is a member – is developing a Roadmap for ASEAN Sustainable Capital Markets.
There are plenty of initiatives to push us away from the brink of environmental catastrophe, but we should not be waiting for others to lead the way.
‘As we intensify our efforts to increase climate resilience, let us not forget that climate action begins with each of us,’ concluded Nor Shamsiah.
Errol Oh is executive content officer of The Star.
"The effects of climate change are not merely an ecological problem for scientists and conservationists to worry about"