Development of ESG framework towards sustainability initiatives in Malaysian automotive manufacturing industry

Abu Seman, Nor Aidatul Shafiefa (2024) Development of ESG framework towards sustainability initiatives in Malaysian automotive manufacturing industry. Project Report. Universiti Teknikal Malaysia Melaka, Melaka, Malaysia. (Submitted)

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Abstract

This project delves into the critical realm of sustainability in the Malaysian manufacturing industry, with a particular focus on the automotive sector, by examining the implementation of Environmental, Social, and Governance (ESG) principles. Due to a lack of standardized ESG frameworks and reporting standards, most companies in Malaysia have a disproportionate amount of readiness with ESG enhancements. The primary goal of this project is to meet the industry's urgent demand for standardized ESG guidelines by providing an organized approach to ESG enhancements and reporting requirements. The first objective focuses on the sustainable practices that have been implemented at well-established automotive manufacturing companies. This study investigates their ESG enhancements through open ended interviews with credible and experienced representatives from Armstrong Auto Parts Sdn. Bhd. and PROTON Tanjong Malim Sdn. Bhd. The findings emphasize the different sustainable methods used by each company, such as their energy efficiency measures, waste management, and employee welfare. These practices serve as the benchmark for the development of the framework that will guide other local automotive manufacturing SMEs (small and medium enterprises) in their ESG enhancements journey. To ensure its effectiveness and relevance, the developed framework is validated by experienced sustainability and ESG analysts. The developed framework emphasizes the relevance of sustainable practices in improving operational efficiency, fulfilling stakeholder expectations, and maintaining long term sustainability in a dynamically changing business environment.

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