Abstract:

The Malaysian government has been working with the main sources of finance, i.e. investors and financiers from bank institutions with significant roles in a company’s growth. As a government arm, the Malaysia Stock Exchange, Bursa Malaysia has established the Sustainability Index known as FTSE4Good Bursa Malaysia (F4GBM) Index with an international consulting company, i.e. FTSE Group in 2014. The aim is to meet the expectations of sustainable investors in the financial market. Companies listed in the F4GBM Index must be reviewed semi-annually to verify whether each company has met sufficient sustainability factors incorporated in the company. Meanwhile, another source of financing is the financier, whereby the bank institution has worked with the government. Recently, CIMB Bank has provided Sustainability-Linked Loans (SLLs) in which the borrower receives financial incentives in the form of interest rate rebates if the borrower can demonstrate that the company has achieved its Sustainability Performance Targets (SPTs). According to CIMB website, the initiative has become a catalyst for businesses to embed environmental considerations into their strategies. It is promising to see investors and financiers working together in promoting responsible corporate citizenship in Malaysia. In this sustainability development, companies need to work on sustainability strategies to win both sources of financing for their company’s prosperity.