Sustainability has become an inevitable buzzword in the corporate world. Businesses across various sectors are launching environmental, social and governance (ESG) roadmaps and targets to align with the rising call for action. Is it really as simple as making public commitments? For GHL Systems Bhd, more needs to be done.
“While launching roadmaps can be a useful guide for the implementation of ESG strategies, the real question to address is: ‘Does it really work?’ A roadmap is merely a guiding document without action. Companies should be placing more focus on the actual steps taken to achieve their ESG goals,” said Chong Kok Wai, who heads the legal, compliance and sustainability department at GHL.
As a financial technology company, reducing carbon footprint is not the main challenge faced by GHL due to the nature of its business. However, this does not mean they do not have their own set of challenges in driving ESG.
“The biggest challenge is justifying the funding of our ESG investments to obtain sufficient resources for our future initiatives. Although our shareholders and investors are in tune with ESG, they still expect a strong bottom line. It is always a juggling act. We need to justify the costs required to improve our ESG performance with the potential savings or returns down the road.”
GHL is also responsible for managing the impact across its value chain – a difficult task for an Apec organisation that relies on a large network of suppliers.
“Our supply chain consists of merchants, micro-SMEs and small and medium enterprises across the region, with many lacking a clear understanding of ESG,” he says.
“Some of them are struggling to build income or make ends meet, and hence ESG practices may not be a priority to them.”
“With everyone talking about ESG or COP26, it may seem like a trend to hop on to remain relevant, but realistically, it can be very difficult to obtain buy-in on the ground,” he adds. Nevertheless, companies should not let these challenges deter them.
“To drive real impact, you just have to get your hands dirty and persevere through these adversities, even though there will be people who may not recognise the significance of ESG initiatives.”
GHL admits that integrating ESG can be tiring and requires a lot of endurance. It is important to learn and work with others to make this journey easier.
“GHL plays an active role in the CEO Action Network (CAN). Through CAN, we get to know more like-minded people and exchange ideas on how to cross different hurdles along the way”.
Regardless of the headways, GHL believes ESG integration is worth the effort.
“It is encouraging to know that we can satisfy our shareholders while bringing social and environmental value, and it is rewarding to see our solutions bear fruit,” he concludes.
Recently, GHL’s efforts in its overall ESG journey gained significant recognition when they became constituents of the FTSE4Good Bursa Malaysia (F4GBM) and FTSE4Good Bursa Malaysia Syariah (F4GBMS) indices. The F4GBM is designed to measure the performance of companies demonstrating strong ESG practices, whereas the F4GBMS tracks constituents in the F4GBM that are syariah-compliant, both giving credibility to organisations committed towards achieving a sustainable future.
WHAT is GHL’s Sustainability Commitment?
GHL is committed to improving its business model in accordance with its Sustainability Framework, with the goal of creating, delivering, and capturing value for all of its stakeholders while not depleting the natural, economic, and social capital it relies on.
How does GHL address the big task of raising environmental and social consciousness amongst their stakeholders?
At GHL, we are determined to raise awareness and educate not only our employees but also our clients, partners and stakeholders across the Asean region.
Our effort includes incorporating and emphasising on our environmental, social and governance (ESG) messaging in both our internal and external communication channels.
So far, we have held two town hall meetings to address this challenge, one for our employees at GHL headquarters and another for our Philippines branch. The meetings were held to educate our team members on how to meet our business objectives without jeopardising future generations’ ability to thrive in a sustainable environment.
GHL has also begun to raise awareness amongst our stakeholders through social media. We have made our sustainability programmes available on LinkedIn, YouTube and Facebook through our GHL Systems Bhd social media accounts.
Employee engagement, we believe, is critical in our corporate sustainability journey. It is difficult to fully realise our sustainability goals without the support and enthusiasm of our employees across the company. We will continue to educate and encourage our employees to participate in our various upcoming environmental initiatives such as coral planting.
What is the one big business opportunity that you can realise/have realised in adopting/implementing ESG principles?
Implementing ESG principles and installing a solar energy platform in the company improved overall performance, which is remarkable given that our initial goal was only to increase renewable energy generation and reduce our carbon footprint by relying less on grid electricity.
Through this effort, we discovered that strong performance on ESG principles is frequently viewed as an indicator of quality factors and good management, particularly in emerging markets. Since incorporating ESG principles into business practices has become an important part of mainstream investment decision-making, we see this as an opportunity for GHL to build trust with our investors and shareholders.
This article is contributed by members of the CEO Action Network.