EPF publishes sustainability investment stewardship policy

KUALA LUMPUR: The Employees Provident Fund (EPF) has published the EPF Sustainable Investment Stewardship Policy, which outlines the processes and guidelines it follows to promote good sustainability practices among its investee companies and external fund managers.

In a statement, the pension fund said it was the first institutional investor in the country to undertake such a policy, which covers approaches to key stewardship areas, such as monitoring, engagement and escalation options.

It said the initiative aims to align companies with its sustainable investment policies and improve management of material ESG risks and opportunities.

Meanwhile, the stewardship philosophy is centred on four key activities, namely proxy voting, monitoring, active engagement and collaborative initiatives.

"We believe that sustainable investment is key to creating long-term value for Malaysia. As a responsible institutional investor, we are committed to advancing this principle by systematically promoting and instilling good business practices that incorporate environmental, social, and governance (ESG) factors into all investment decisions," said EPF Ahmad Zulqarnain.

He said the stewardship commitment accelerates the EPF’s progress towards achieving a fully ESG-compliant portfolio by 2030 and a climate-neutral portfolio by 2050.

Ahmad noted that the EPF is aligned with several global and local principles-based codes, and is a member of the Sustainable Investment Standards (SIS), the UN-backed Principles for Responsible Investment (PRI) and the Malaysian Code for Institional Invests (MCII).