KUALA LUMPUR: Star Media Group Bhd has been included as the new additions to the constituents of the FTSE4Good Bursa Malaysia Index.
The FTSE4Good Bursa Malaysia Index measures the performance of public listed companies demonstrating strong environmental, social and governance (ESG) practices.
In the latest review period of June 2020, Bursa Malaysia said there were six new additions and two deletions from the index constituents, bringing the total number of constituents to 73, an increase of 204% since its launch in 2014.
The inclusions are: Bermaz Auto Bhd, Duopharma Biotech Bhd, Inari Amertron Bhd, Karex Bhd, RCE Capital Bhd and Star Media Group. Those deleted from the list were Parkson Holdings Bhd and UMW Holdings Bhd.
“Bursa Malaysia and FTSE Russell have been conducting outreach programmes to companies to encourage and support them in improving their ESG disclosures and practices.
“The continuous increase in the number of constituents is a reflection of the PLCs benefitting from these programmes and catalysing their efforts towards ESG best practices,” Bursa Malaysia said in a statement.
FTSE4Good Index constituents are drawn from the companies on the FTSE Bursa Malaysia EMAS Index, comprising PLCs from across the small, medium and large market capitalisation segments.
The index is reviewed in June and December against international benchmarks.
The ESG trend in Malaysia has started to take place with the country’s large asset owners, such as the Employees Provident Fund (EPF), the Retirement Fund Incorporated (KWAP) and Khazanah Nasional Bhd.
These companies are the signatories to the UN Principles for Responsible Investment (UNPRI), which demonstrated their commitment to responsible investments to advocate a more sustainable financial system.
In April 2019, the EPF signed the UNPRI, underlining its commitment towards responsible investing and ESG best practices while acting in the best long-term interests of its members.
The EPF has traditionally been a socially-conscious investor in excluding companies that are seen as unethical such as alcohol, tobacco, gambling, weaponry and nuclear power.
The UN-backed PRI has been recognised as the leader in responsible investment with more than 2,000 signatories to date representing a total fund size of over RM288 trillion.
Meanwhile, Bursa Malaysia is one of the earliest bourses in the region to introduce an ethical investment stock market index in the FTSE4Good Bursa Malaysia Index in 2014.
The index currently has 73 constituents compared with 24 when it was launched in 2014.
The Securities Commission Malaysia has also released the Sustainable and Responsible Investment (SRI) Roadmap for the Malaysian capital markets, aimed at creating an SRI ecosystem and charting the role of the capital markets in driving sustainable development.