Climate Week New York: Climate Governance Malaysia Showcase

Transcription

1. Climate Week New York Thursday - 10 December 2020 Climate Governance Malaysia Showcase Individuals and businesses exploit the Earth ’s natural resources and have harmed our environment to the extent that clean air and water seem like a luxury nowadays. The key issue of not incorporating sustainability is the lack of awareness and knowledge at the Board level to adopt good practices and contribute towards a better future. Nature underpins our economy and our wellbeing. Consumers and investors should look for companies that pledge to zero deforestation. The pandemic is an eye-opening reminder that sustainability and sustainable practices today are the key agents of change for the future of the country’s economy and financial system. INTRODUCTION n this live event organised by Climate Governance Malaysia, speakers from across organisations and institutions joined to share their views on the impact of urbanisation and commercialisation on the tropical forest ecosystems in Malaysia. Since 1990, 3.9 million hectares of natural forest environment have been cleared for palm oil plantations alone, with other parts of the country’s natural landscape also being taken down for other activities such as timber production and urbanisation. This has inevitably caused disruption to the climatic balance in the country. Sunita Rajakumar, Founder of the Malaysian Chapter of the World Economic Forum’s Climate Governance Initiative, commenced the live session by putting DATIN SUNITA RAJAKUMAR into perspective the Founder Malaysian Chapter of importance of the the World Economic Earth and its Forum’s Climate resources to human Governance Initiative existence, explaining how individuals and businesses exploit the Earth’s natural resources and have harmed our environment to the extent that clean air and water seem like a luxury nowadays. The result is a world filled with pollution, disease, congestion, and the global threat of a climate emergency that we are not equipped to deal with. Rajakumar then opened the platform by inviting Dato’ Sri Mustapa Mohamed, Minister in the Prime Minister’s Department for Economic Affairs to set the tone for the discussion. Mohamed stated that creating awareness surrounding environmental degradation is imperative and that his country is committed to implement policies for strategy development to increase the importance of Malaysia’s environmental agenda. Mohamed stated that several green initiatives have already been initiated to be YB DATO’ SRI undertaken by the Government, MUSTAPA MOHAMED the private sector, as well as the Minister in the Prime Minister’s Department civil society. These include green for Economic Affairs procurement, green buildings, infrastructure, and low carbon mobility, in addition to forest conservation and protection. The Government is offering financing support and other incentives to act as a catalyst in creating an enabling environment and support businesses to make the change. Speaking of Malaysia’s goal to achieve carbon neutrality by the middle of the 21st century, Mohamed touched on the efforts taken to advance the Government’s green Principles for Effective Climate Governance Subject Command Climate Accountability Materiality Assessment Board Structure Organisational Purpose Strategic Integration Reporting & Disclosure Incentivisation Exchange growth agenda. To combat climate change, Malaysia is setting higher standards of environmental governance and pushing the transition to sustainable energy by setting a target of 30% renewable energy installed capacity within the power sector by 2025. These efforts reflect a systematic shift that is required to establish long-term resilience, provide environmental and societal benefits, as well as to generate economic opportunities and sustainable businesses. Mohamed also pledged Government support to forest management and biodiversity conservation, stating this as vital to maintain an important national asset. The Minister called for unity amongst all stakeholders, adding the importance of mapping out milestones and reinforcing accountability of stakeholders to facilitate a realignment of investments supporting the green growth agenda. Mohamed concluded his address requesting a collective effort to tackle the climate crisis in order to create a greener and better future. Karina Litvack, Co-Founder of the Climate Governance Initiative, explained how the idea of incorporating sustainable, and climate conservation practices KARINA LITVACK into organisational Non-Executive strategy seemed Director daunting to Executive Oil & Gas major Eni S.p.A Management, noting the challenges involved in incorporating such practices. The key issue is lack of awareness and knowledge at the Board level to adopt good practices and contribute towards a better future. However, she highlighted that organisations needed to acknowledge that they already have a legal obligation to act based on the governance rulings in place. She encouraged proactiveness in tackling the
2. climate crisis , rather than waiting for Governments to initiate regulations and issue guidelines. Recognising that this is a “blind spot” for most at Director-level, Litvack introduced the audience to the eight core principles behind the Climate Governance Malaysia Initiative (CGMI), a framework of best practices that a “good Board” could take to ensure “proper responsibility” for overseeing climate change. Litvack noted that Climate Governance Malaysia is only the second, and the first in Asia, of 25 country chapters being developed globally. The core principles under the CGMI include accountability, subject command, Board structure, materiality assessment, strategic integration, incentivisation, exchange, reporting and disclosure. She urged organisation Board members to incorporate these principles into the short, medium and longer-term organisational strategies, to ensure the viability of companies over the next few decades. In addition to creating resilient businesses in this way, Litvack emphasised on transparency and urged Board Members to clearly understand their respective roles and to act as responsible agents of change. Litvack ended her presentation, addressing climate governance as a “borderless issue” requiring a “borderless solution” in order to ensure sustainability of businesses in the coming decades. FOREST CONSERVATION AND PROTECTION INITIATIVES: VIEWPOINT FROM NGO CONSERVATIONISTS The panel of this session, moderated by Dr Kalanithi Nesaretnam along with Luanne Sieh, focused on the views of acclaimed DR KALANITHI conservationists from NESARETNAM NGOs working in Non-Executive Sabah in Malaysian Director, FGV Holdings Borneo, and Kedah in Peninsular Malaysia. Conservationists included Dr Glen Reynolds, Director of the Southeast Asia Rainforest Research Partnership (SEARRP), Dr Dzaeman Dzulkifli, LUANNE SIEH Executive Director at Head of Group Sustainability the Tropical Rainforest CIMB Conservation and Research Centre (TRCRC), and Norizan Mohd Mazlan, Head of Conservation, Peninsular Malaysia at WWF-Malaysia. The speakers highlighted their respective forest conservation and protection initiatives, as well as objectives and strategies for sustainable practices in the environment. Reynolds started off sharing the role of SEARRP, based in Danum Valley Field Centre in Sabah for over three decades. It is widely renowned for conducting impactful and influential rainforest research and has generated over 700 scientific publications that have been cited over 45,000 times. This evidence has spurred vital rainforest conservation initiatives, and boosted understanding of tropical rainforests, their threats and the ways to mitigate them. Reynolds elaborated that forest restoration and recovery from logging, included both natural recovery as well as assisted recovery by active restoration tree planting. Issues relating to land use change and the conversion of DR GLEN REYNOLDS forest to plantations are also vital. Director He noted that almost all the South East Asia Rainforest Research SEARRP scientists have work related Programme (SEARRP) to oil palm landscapes, including land use change, and sustainable measures to reduce environmental impact in terms of biodiversity, greenhouse gas emissions, adding that this is now “the frontline for conservation across large parts of Southeast Asia”. Dzulkifli spoke about the conservation work conducted at the TRCRC, also based in Sabah, which focuses predominantly on restoration efforts. Dzulkifli detailed the restoration process, which starts from the seed and nursery stage, DR DZAEMAN DZULKIFLI and focuses on collecting diverse Executive Director species in order to restore forests Tropical Rainforest that serve humanity in providing Conservation & Research Centre clean water and habitats for endangered species. He noted that the 200 hectares of forest in Sabah had been degraded over the past 10 years but is now in the process of recovery. TRCRC is introducing a range of different endangered trees to this habitat, which will form the building blocks of a genetic bank that will grow and provide seed sources for restoration projects throughout Sabah. Dzulkifli revealed that seed collection and the procurement of seeds, as well as understanding forest dynamics are a key focus of TRCRC’s work. The centre also provides employment opportunities for local communities within neighbouring areas, building up the database of seedlings by manually collecting seeds from trees, which are then grown and developed at the nursery for the next two years. After the trees germinate, the team then plants them in the forest. In response to a question regarding potential strategies to lower deforestation rates, Dzulkifli added that carbon credits should be implemented to add value to forests, whilst also introducing watershed protection payments for ecosystem services, and pushing governments to adopt financial systems to value forests beyond just being valued as a timber source. Dzulkifli added that some States in Malaysia are taking their own actions, citing examples of Sabah developing carbon initiatives, and Kedah implementing payment for ecosystem services. NORIZAN MOHD MAZLAN Head of Conservation Peninsular Malaysia WWF-Malaysia fauna species, with nearby villagers relying on its natural resources for survival by gaining income from rubber tapping, sustainable organic paddy farming, and being forest guides. In particular, Mazlan emphasised on the role of traditional honey hunters who live adjacent to Ulu Muda Forest, adding that there are a number of younger generation honey hunters from nearby villages, and this occupation is being passed down from generation to generation. Mazlan emphasised Ulu Muda’s role as a crucial water catchment, which provides long-term water resources to 4 million people living in Kedah, Penang and Perlis, including businesses, industries, agriculture sector, and the island of Langkawi. In addition, the Muda agricultural scheme, which contributes 40% of Malaysia’s rice production, also relies on irrigation via three dams found within the Ulu Muda Forest complex. Today, the water catchment function is at risk due to unsustainable land use driven by the need for economic development which threatens its water provision ecosystem. Emphasising that the conservation of Ulu Muda is not only vital for biodiversity but also to ensure the landscape’s resilience in the face of climate change impacts, Mazlan stated that the “protection of water catchment and forests, ecological corridors and forests restoration, carbon concessions and eco-tourism are all potentials” that the Kedah Sustainable Landscape Initiative is exploring. She also revealed that the initiative required seed funding to enable studies and political will, as well as support from public and private sectors, NGOs, communities and experts with aims to bring in green investments and secure long-term sustainable financing. All three NGO speakers were unanimous in highlighting the importance of local partnerships and collaborations with key stakeholders to solve the climate crisis. The panel concluded with the speakers leaving key messages and call to actions. Reynolds stated that consumers and investors should look for companies that pledge to zero deforestation. Mazlan emphasised the vital role of nature, stating that “nature underpins our economy and our wellbeing”. Dzulkifli highlighted that hope remains as degraded forests still have the ability to regenerate over a decade or so, and more input is required to restore forests back to their natural ecosystems, adding that it is important to work with different partners and identify key areas that can be restored. IMPACT OF CORPORATES ON CLIMATE CHANGE AND SUSTAINABILITY Rounding off the panel, Mazlan spoke about WWF Malaysia’s Kedah Sustainable Landscape Initiative which focuses on protecting and conserving Ulu Muda Forest, the most important water catchment forest, situated in the north-western side of Peninsular Malaysia. The next panel saw key management personnel across three organisations from different industries in Malaysia, discussing their views of the current environmental and social challenges impacting businesses today. Each speaker shared how their respective companies are responding to these challenges with real actions taken. Speaking of the importance of the Ulu Muda Forest, Mazlan stated that it is home to thousands of flora and Rashyid Redza opened his session stating that the palm oil industry that Sime Darby Plantation operates in, is under severe scrutiny
3. from a range of stakeholders . Talking about the key challenges facing the palm oil industry, Redza captured five issues broadly in line RASHYID REDZA with Sime Darby Head, Group Plantation’s view on Sustainability sustainability. These Sime Darby Plantation Berhad included: 1) the deforestation of land and conservation of biodiversity and ecosystems; 2) reducing greenhouse gas emissions and addressing the issues of fire and haze; 3) exploitation of workers and local communities; 4) traceability and transparency throughout the supply chain; and 5) food safety in the food produced by the company. Redza then went on to explain the initiatives taken towards addressing these issues, stating that the company enforces a strict no deforestation policy, partnering with third parties to monitor deforestation using satellites and other monitoring technologies. Sime Darby Plantation has also launched Crosscheck, a publicly available online platform which provides a transparent view of the company’s global supply chain from end to end, as well as an online hotspot dashboard that discloses publicly any hotspots detected, the action taken within a five-kilometre radius, and alerts managers of any suspicious activity. In addition, the company has planted over 1.4 million rare, endangered and threatened plant species through its global conservation and biodiversity program. estimates current and future emissions and incorporates strategic plans to decarbonise by assessing climate risk (both physical and financial) in its operations and all of its future investment decision-making. This is done by putting a shadow price or a price on the company’s carbon impact. Cheng concluded his presentation with emphasising that sustainability is a collective responsibility of not only authorities and corporates, but also communities, and that sustainable practices require a strong level of commitment that will bring long-term profitability to organisations. MICHAEL E. LONG Asia Regional Head of Sustainability Lendlease Responding to an audience question, Long addressed the issue of transparency with regards to sustainability initiatives taken by organisations, stating that year-end disclosures in the financial reports included climate-related risk in the shareholder reports, along with transparency in the organisation’s sustainability data and information collected. Finally, Long suggested that companies disclose their sustainability roadmaps, and include related progress reports showing clearly how climate risk is embedded into organisation-wide strategy. Moving away from the view of global players, Arsalaan Ahmed started a discussion with Cheng Jew Keng, a local operator in the private sector, that took a mining wasteland and converted it into Sunway City, Malaysia’s first smart and sustainable city development. CHENG JEW KENG In his opening remarks, Cheng Head, Sunway Group's Sustainability noted that the biggest challenge Task Force faced today in relation to Sunway Group sustainability is a lack of community awareness and an attitude of indifference. Cheng stated that many individuals and organisations approached the idea of sustainability with a “business as usual” mind-set aimed at achieving short-term gains. As with Sunway, visionary leadership played a critical role in leading a change of the environment within the organisation. Sharing some of the project’s sustainable policies, Cheng explained the project’s integrated land use approach, with 40% of the township allocated to green and open spaces, including 31,000 trees planted and restored biodiversity. Sunway City also includes low-carbon connectivity initiatives whereby community members can walk within the city or use electric-powered public transport to commute. The development project also features a water treatment plant which treats water resources available within the land space for use in the Sunway City’s commercial buildings. The floor was then handed over to Fraziali Ismail, who drew inspiration in his address from environmental activist, Jadav Payeng, from India who created an entire forest almost the size of Central Park in New York, by simply planting one tree a day over a period of 40 years. Ismail also FRAZIALI ISMAIL commented on the work Assistant Governor Bank of of Afroz Shah from India, Central Malaysia who initiated a movement to clean up Versova beach in Mumbai, resulting in a complete transformation of a once filthy beach becoming “fabulous”. According to Ismail, the success stories of these two individuals provided lessons to the world, showing that no action is too small with regards to protecting the environment. y bilit n Emis sio ea Trac Ismail concluded the live session with his thoughts on how to take climate change initiatives forward, which he summarised in the 4 Cs – COVID-19 and Climate Change, Collective Responsibility, Commitment, and Collaboration. Ismail stated that the ongoing pandemic is the ideal time to reflect, reset and reprioritise, adding that the world now has the opportunity to leverage on the current crisis to shift the world onto a new Arsalaan (Oz) Ahmed, trajectory with lower risks of future climate moderating the panel, calamities. Ismail added that it has been Bank then opened a Negara Malaysia’s agenda to build up discussion on capacity of financial institutions in the sustainable country such that these institutions become urbanisation, inviting effective agents of change in transitioning Michael E. Long to towards a low-carbon economy. Ismail also ARSALAAN AHMED discuss efforts taken (OZ) stressed the need for key stakeholders to by Lendlease, a real Chief Executive come together to initiate and drive climate estate developer, Officer HSBC Amanah change agendas forward. In this regard, where Long stated Malaysia notable mention was made of the Joint that the central theme Committee on Climate Change (JC3), set up of the company’s approach focused on Cheng went on to show ways in which Sunway City in September of 2019, which is a platform for long-term value creation and sustainable hasadopted a decarbonisation strategy, emphasising financial regulators and financial institutions practices. According to Long, it is energy efficiency, production and use of renewable to collaborate in order to strengthen and imperative to actively think about “the energy, having set a target of producing 10,675 deepen their understanding of climate risks places we create”, how these places would megawatts of renewable ener by the end of 2020. and collectively develop solutions and tools be decades away from the present and to respond to these challenges. Ismail noted whether these places would “continue to that such collaborations could give rise to thrive and be adaptable to the way we How safe is the Who owns it? more innovative financial instruments or behave as humans and the way the food we eat? What’s on it? y r it alternative financing, sustainable, green climate changes over time”. L g an e d nt bonds or Sukuk in order to support the dI o Fo Long presented some interesting Terms' Government of Malaysia’s agenda for climate statistics, stating that with urbanisation Flexibilitychange. anticipated to increase to 68% by 2050, it Sustainability According to Ismail, the pandemic is an is crucial for Lendlease to incorporate Challenges in eye-opening reminder that sustainability viability, as well as Palm Oil Industry sustainability and sustainable practices climate and community resilience (Sime Darby Plantation Berhad) How transparent Are we part of the today are the key agents of change for in its projects. Lendlease’s is our supply problem or part of the future of the country’s economy sustainability strategy is centred chain? the solution? and financial system. around areas where the company can create the greatest positive Exploitation impact. One of its two key targets is to become a 1.5 degree-aligned Are we treating our Watch again on IslamicMarkets.com organisation, whereby management workers with respect?