Assistant Governor Madelena Mohamed oversees Bank Negara Malaysia’s strategy and sustainability sector.
AS the chair of Asean in 2025, Malaysia has chosen a theme that resonates deeply with the region’s aspirations: ‘Inclusivity and Sustainability’. This theme is not just symbolic. It is backed by a series of bold, strategic initiatives designed to turbocharge Asean’s transition to a low-carbon and resilient economy.
Bank Negara Malaysia (BNM) plays a key role in shaping the financial architecture to support this transformation. As Asean charts its path to becoming the world’s fourth largest economy, the Asean Power Grid (APG) Project is central for the region’s growth and energy future.
As countries gradually phase out coal, the APG will play a critical role in facilitating the efficient generation and flow of renewable energy within the region. Under Malaysia’s Asean Chairmanship, BNM is prioritising efforts to catalyse access to finance for a just and climate-resilient transition.
This includes facilitating funding for the APG, given the substantial investments needed to upgrade and modernise the infrastructure and advance multilateral power trade implementation.
Malaysia remains strongly committed to the APG vision and is actively executing actions towards realising it, starting with the tripartite partnership formed with Vietnam and Singapore in advancing transnational energy infrastructure.
The scale and complexity of the APG warrants new financing approaches. Public, private and philanthropic partnerships, backed by innovative funding structures such as Islamic and blended finance are needed to unlock the capital needed to power the projects forward.
This is a long-term, highly complex yet economically significant infrastructure project. We are heartened by the strong response from a range of risk capital providers and funders which underscores growing confidence in Asean and its energy transition agenda.
More than 15 prominent investors and partners have indicated interest in supporting APG projects and we look forward for more to come on board. Launched in June 2025, the Climate Finance Innovation Lab (CFIL) will act as a game changer in advancing Malaysia’s climate finance ecosystem.
It serves as a collaborative platform connecting project owners and funders. Administered by Bank Pembangunan Malaysia Bhd (BPMB), a development financial institution, CFIL aims to ideate and co-structure innovative financial solutions across four thematic areas: energy transition and green innovation, sustainable agriculture, circular economy and sustainable cities, and nature-based solutions and biodiversity.
Eligible projects will gain access to funding, technical assistance and a network of stakeholders. It’s time to fast-track climate finance and nature-positive actions in Malaysia. Public, private and philanthropic actors must work hand-in-hand to power Malaysia’s climate and sustainability journey. This will turn ambition into real impact.
The inaugural CFIL Capital Solutioning session (CFIL Lab) took place in November 2025 for a high-impact eco-restoration and circular economy programme, attracting 71 institutions. CFIL also features an accelerator programme for a structured readiness journey for enterprises to strengthen their impact, financial, and governance capacities to become investment ready.
Since its launch, projects listed under CFIL have attracted strong interest from investors. Members of the Joint Committee on Climate Change (JC3) have pledged support through funding and technical expertise.
The JC3, established in 2019 has evolved into a co-creation platform to address the industry’s needs. Through the JC3, BNM works collaboratively with relevant stakeholders, namely the JC3 co-chair, Securities Commission Malaysia, government ministries and agencies, and industry players. We view this to be crucial in realising our climate ambition.
Beyond large-scale infrastructure, Malaysia is also championing support for small and medium enterprises (SMEs), which make up over 99% of businesses in Asean. Through the Greening Value Chain (GVC) programme, JC3 members are helping SMEs measure and report their greenhouse gas (GHG) emissions as well as improve energy efficiency.
Participants have access to GHG emissions measurement tools, and transition financing to build resilience and capture new opportunities. More than 2,000 SMEs have undergone a technical training programme and over 200 have started to measure and report their GHG emissions under this programme.
The GVC programme is now expanding regionally. A playbook titled ‘Building Supply Chain Resilience: Insights into Greening Value Chains for Asean’ co-developed by BNM, the Asian Development Bank (ADB) and the United Nations Development Programme (UNDP) was released as a guide for businesses and financiers.
The rollout of the GVC in Cambodia and soon in the Philippines is a testament to the growing
interest in facilitating SMEs in the region to remain competitive and build resilience within the global supply chain and the Playbook serves as a key reference in this journey. We foresee many other Asean Member States to follow suit.
Malaysia’s leadership in Asean is also evident in its contributions to regional sustainable finance frameworks. This includes being one of the drivers in the development of the Asean Taxonomy for Sustainable Finance (Asean Taxonomy).
The release of Asean Taxonomy Version 4 in November 2025 marks the completion of the regional effort to develop a comprehensive framework for classifying sustainable economic activities. This is expected to unlock greater capital flows into projects that drive sustainability across the region.
A vision for impactful implementation
With over three decades of service at BNM, Madelena brings deep institutional knowledge and a clear vision for the future. Under her leadership, the central bank is accelerating efforts to integrate climate considerations into its internal operations and develop a credible transition plan.
Capacity development programmes are being rolled out to enhance stewardship and readiness. The financial sector plays a key role in assisting the country build resilience and achieve net zero GHG emissions by 2050. The foundations are in place, thanks to pioneering efforts by Islamic financial institutions.’
The journey ahead is complex, but with leadership from institutions like BNM, the region is well-positioned to meet the challenges of climate change and seize the opportunities of a green economy.
