The EU's CBAM will impact 75% of Malaysia's exports to the bloc. (Photo: thestar.com.my) Kuala Lumpur (VNA) – The European Union (EU)’s Carbon BorderAdjustment Mechanism (CBAM) will impact 75% of Malaysia’s exports to the bloc, accordingto the Securities Commission Malaysia (SC).
In its Capital Market Stability Review 2023, the SC said that although the EUaccounted for only about 8% of Malaysia’s total exports during 2021-2023, itsclimate and environmental, social and governance (ESG)-related policies likeCBAM will affect Malaysian firms through multiple channels.
There is an increasing proliferation of disclosure standards and ESGrequirements being imposed at an international and domestic level, all of whichrequire compliance and attention from corporates, it said.
Against this backdrop, the SC is building athematic study assessing the risk exposure of Malaysian public-listed companies(PLCs) to sustainability factors to emphasise the importance of looking atbusiness strategy and sustainability to incorporate transition plans, giventheir potential impact on PLCs.
To deliver on the goal, the SC chaired an advisory committee on sustainability which works to identify enablers that will facilitate the use of the standardsof the International Sustainability Standards Board (ISSB) in Malaysia and buildassurance frameworks to support domestic enterprises.
Firms that have engaged in traditionally carbon-intensive sectors or those withthe highest emissions may face the highest costs and risks of strandedassets during any adjustment by investors of clients alike to reduce the carbonintensity of their business activities./.
