How sustainability principles are shaping glove manufacturing

Kuan: "Hartalega has invested more than RM98mil to date in providing first-rate accommodation for 'Hartanians' as well."

Hartalega CEO shares insights on ESG PIA 2022 win

EARLIER this year in July, Hartalega Holdings Berhad bagged the Gold award at the ESG Positive Impact Award’s (ESG PIA) 2022 gala night under the Large Companies Tier for the category of Social – Human Rights and Labour Standards.

Speaking with StarESG, Hartalega chief executive officer Kuan Mun Leong noted that the award not only celebrated the company’s achievements but also recognised the dedication of every employee who played a vital role in advancing Hartalega’s sustainable journey.

How would you describe what Hartalega is?

Hartalega is one of the world’s leading producers of high-quality nitrile medical examination gloves. We lead the industry in innovation and have developed the most advanced glove production technologies and game-changing products.

We are driven by our SHIELD core values: Synergy, Honesty, Innovation, Excellence, Learning and Dedication and our steadfast commitment to these values gives us a competitive edge in the industry.

How does Hartalega observe each ESG pillar as a company?

> Environmental: We strive to contribute to a sustainable future by upholding our environmental responsibilities throughout our operations. This includes environmental compliance aligned with local and international standards, responsible management of energy consumption, reduction of carbon emissions, effective waste management as well as water consumption and effluents.

Social: Caring for our ‘Hartanians’ is integral to the Group. We have comprehensive policies to uphold strict standards of human rights, social compliance, ethical conduct, fair labour and recruitment, and health and safety.

Governance: Maintaining sound business ethics and best practices in corporate governance is paramount for Hartalega. We have a robust governance structure and policies to ensure strict adherence to transparency and accountability.

How do your ESG goals help you maintain your company’s integrity?

Integrating ESG goals and communicating our progress showcases Hartalega’s sustainable growth as a responsible company, allowing us to set benchmarks within the industry.

Our demonstrated commitment to best practices in social compliance has enabled us to maintain our trusted reputation, even amidst issues within the glove industry.

Hartalega’s track record has been highly ranked among ESG ratings providers. This includes an A rating by MSCI ESG Ratings, ranking in the low-risk category of the Sustainalytics ESG Risk Scores, and being a constituent of FTSE4Good Bursa Malaysia since 2014.

When has ESG been an integral part of your company’s culture and what were the changes in your performance after incorporating it?

ESG is intrinsic to Hartalega’s Shield values, which have been built since our inception.

With a focus on ESG, we established a target of 25% reduction in carbon emission intensity by FY2026, using FY2023 as baseline.

A key component of this is utilising energy-efficient technologies and increasing our renewable energy usage. In FY2023, our solar power generation increased by 81%, and we will continue prioritising energy efficiency and put greater reliance on renewable energy.

We foster a robust social compliance culture through measures such as Zero Cost Recruitment Policy and fair recruitment practices, amongst other efforts to safeguard our Hartanians.

How did you measure the success and effectiveness of your ESG initiatives?

By setting clear targets for ESG and sustainability, we have well-defined metrics that we track to determine our progress and performance. The execution of our governing policies and social compliance strategies, along with the supervision of social audits, is entrusted to our Social Compliance Task Force, Human Resources Department and Social Compliance Department. During FY2023, we conducted a total of 19 external audits, maintaining our positive track record with an A rating for our amfori BSCI audit for NGC facility.

We also completed an audit for the International Labour Organisation’s 11 Indicators of Forced Labour, which detected no major or critical findings, as well as earning a Gold accreditation in the Worldwide Responsible Accredited Production audit.

Were there any unexpected hurdles while implementing ESG initiatives? How did you overcome them?

Mindset can be a challenge in efforts for change. Achieving positive transformation necessitates aligning people’s goals and expectations, whether within our operations or throughout our value chain.To address this, we emphasise alignment in the application and oversight of our policies and protocols throughout our organisation. In our value chain as well, we regularly engage with suppliers and undertake the necessary due diligence to ensure compliance.

How do you intend to build on your current achievements and continue driving sustainable practices within your organisation and the surrounding community?

We’ll continue to work towards the ESG and sustainability goals we have set, with definitive plans in place to drive our progress.

Our objectives are guided by the UN Sustainable Development Goals to achieve globally-aligned benchmarks.

We also aim to strengthen collaborations across our value chain and engage with stakeholders to drive positive change in the glove sector.

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