2023 SME SUSTAINABILITY SERIES: CHARTING THE ESG PATH FOR SMEs

The inaugural workshop of the 2023 SME Sustainability Series was held today and benefited more than 50 Small and Medium Businesses (SMEs) in the oil and gas services and equipment (OGSE) sector. It was organised by SME Corp. Malaysia in partnership with PETRONAS. The event is a component of a public awareness campaign run under the PKSlestari initiative to help SMEs, particularly microenterprises, map out their sustainable route.

PKSlestari is an initiative by SME Corp. Malaysia to encourage and accelerate  adoption of Environmental, Social and Governance (ESG) practices among SMEs by  developing the SME sustainability ecosystem. The ecosystem will consist of  awareness and education, SME ESG Assessment, policy support, market access, standard and compliance as well as financing and incentives.

The full-day workshop educates participants, who are mostly SME vendors to  PETRONAS, on the importance of ESG practices, development of ESG strategy as  well as measurement and monitoring of ESG performance. As ESG is becoming more  significant and will be the future trend following Malaysia’s commitment to the Agenda  for Sustainable Development 2030, most large firms, multinational corporations  (MNCs) and Government-linked Companies (GLCs) have begun adopting ESG  practices in their business operations. Therefore, it is crucial for SMEs to embrace  ESG practices as this will not only have a positive social and environmental impact but it will also allow SMEs to penetrate into the supply chain of large firms and MNCs that  require their vendors and suppliers to adopt ESG practices.

Participants of the workshop were also introduced to the SME ESG Assessment, a  self-assessment tool that can guide firms in their ESG journey by identifying gaps in their management system based on the 12 ESG indicators identified. Based on their  scores, SMEs will be categorised into five levels where they will have a clear indication  of their ESG level and hence be able to identify strengths to enhance and weaknesses  to rectify.

“We recognise that it will take some time for SMEs to acquire the relevant knowledge  and expertise to ensure sustainability in their operations. Nevertheless, SMEs should  start their efforts in this direction by taking small but sure steps immediately as they  recalibrate and restrategise their operations post COVID-19 pandemic”, said Rizal  Nainy, Chief Executive Officer of SME Corp. Malaysia.

Natrah Mohd Tahir, Head, Strategic Programme & Licensing, Industry Shaping &  Collaboration, Group Procurement, PETRONAS said, “We believe this session will  help strengthen participants’ understanding and commitment towards a sustainable  industry for OGSE, particularly for SMEs. With enhanced knowledge, the SMEs will  be able to make informed decisions in navigating the energy transition.”

Also present during the workshop was John Henry Thornton, Managing Director,  Business Excellence of Dialog Group Berhad, who shared his company’s experience  and journey towards sustainability for others to emulate. Other participants include  representatives from the Malaysian Oil, Gas & Energy Services Council (MOGSC),  Malaysia OSV Owners’ Association (MOSVA) and Malaysia Petroleum Resources  Corporation (MPRC).