Asia's green path

How sustainability has become the key for businesses to ensure they achieve their mission.

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ith the world experiencing unprecedented climate-related disasters over the past few years, it's more important than ever for companies to ramp up their sustainability commitments. Corporations have a crucial role to play. According to recent data, publicly listed companies alone are responsible for 40% of all climate warming emissions, twice that of previous estimates. 

In a market where investors, consumers, partners, and suppliers are increasingly concerned about social and environmental issues, sustainability starts to become a business imperative. As a result, environmental, social, and governance (ESG) standards are becoming commonplace in most corporations, and are now playing a crucial role in how these organizations operate. 

What used to be a "nice to have," siloed away under a vague commitment to corporate social responsibility, is now an essential part of a company's strategy; it is embedded in key business lines and corporate functions such as financial planning, human resources, procurement, supply chain management, and more.

Business success can be driven by sustainability

Sustainability is no longer simply about compliance — it is an opportunity for companies to thrive and succeed. It can also be about generating profits and adding company value by driving innovation, lowering costs, attracting and retaining employees, building brand loyalty, and much more. 

Companies across multiple business sectors are fast getting on board. Take Schneider Electric for example. The French multinational, which specializes in digital automation and energy management, is widely considered among the world's most sustainable companies, despite operating in an industry that is on the front line of the climate challenge.  

Renewable energy sources now power 50% of Schneider's global operations, while the company has helped its customers save and avoid 440 million tons of CO2 since 2018, with more than 90 million more in 2022 alone. Last year, the company reported that 72% of its revenue came from products and solutions that generate energy or resource efficiency to customers.

One Southeast Asian corporation that has built its success on the back of sustainability is Malaysia's Sunway Group. In 1974, Sir Dr. Jeffrey Cheah, Sunway's founder and chairman, had the novel idea of building Malaysia's first fully integrated and sustainable township just outside the capital of Kuala Lumpur. 

The land was a tin-mining wasteland, deserted and full of mud, sand, and gravel. "But where others saw a deep scar in the Earth, I had a different dream," Cheah said. 

Unsurprisingly, few people shared his vision, or his belief in the power of sustainable development — many decades before it became a priority for most corporations.

In the years that followed, that dream became Sunway City Kuala Lumpur, now considered a template for sustainable living and home to more than 200,000 people and businesses. Meanwhile, Sunway Group, which will celebrates its 50th anniversary this year, has grown to be a major Malaysian success story and is recognized as one of Southeast Asia's highest-performing conglomerates.

"Everything that we do is about the future generations," Cheah said. "That means acting as responsible stewards of the planet and promoting socio-economic goals. Our commitment to sustainability and our core values add up to a powerful combination that has fuelled Sunway's growth and expansion over the years. It has propelled Sunway to be ranked among the top three companies in the sectors we are involved in."

Going beyond net zero  

Over the past several years net zero — balancing greenhouse-gas emissions to the point that the amount taken out of the atmosphere is equal to the amount emitted — has become the measuring stick for sustainability among the world's largest corporations. According to a 2021 report by the Energy and Climate Intelligence Unit (ECIU) and Oxford Net Zero, at least 21% of the world's 2,000 largest public companies, representing sales of almost $14 trillion, say they now have made net-zero pledges. 

This makes sense. The scientific consensus is that net-zero carbon targets are critical to prevent global temperatures from rising, with 2050 marked as a key target for carbon neutrality. Sunway, for example, has pledged to achieve net-zero carbon emissions by 2050 and was the first corporation in Malaysia, and among the first in Asia, to implement a carbon pricing framework into its business.

But sustainability comes in many forms, shown most clearly in the United Nations 17 Sustainable Development Goals, which not only focus on climate change actions, but also cover areas such as education, gender equality, health, and economic growth.

As such, a growing number of companies are now aligning a significant part of their business strategy with SDGs. A 2022 report from the Amsterdam-based Global Reporting Initiative found that 83% of companies surveyed stated that they support and recognize the value of the SDGs, while 40% had set measurable commitments to how they would help achieve SDG targets. Again, this is not just about doing good — there is also a clear business case. The Business and Sustainable Development Commission estimates that achieving SDG goals could result in at least $12 trillion worth of market opportunities a year for the private sector by 2030, which would be equivalent to roughly 10% of forecasted GDP. 

A good example of this in practice can be seen in how Sunway continues to explore business lines that can contribute to the overall sustainable development of Malaysia. Looking at healthcare as one development goal, Sunway currently operates the biggest tertiary and quaternary private hospitals in Malaysia, as well as numerous other healthcare facilities across the country.

Given the continuing sector growth, the company is investing in meeting evolving patient needs and helping to safeguard public health, while also generating company profits. In total, Sunway has invested some $256 million on the expansion of its medical centers.

"Based on demographic trends, we are of the view that healthcare will be increasingly in-demand in the coming decades," said Evan Cheah, Group CEO of Sunway's digital and strategic investments. "Accordingly, we have made significant investments in our healthcare arm." 

Adopting the triple bottom line

These kinds of strategic investments emphasize once more the importance of companies making the shift from simply focusing on generating profit and instead adhering to what is known as the "triple bottom line," or the "three Ps" — people, planet, and profit. 

 And while some may still see ESG and sustainability targets as unrealistic in the face of hard business realities, innovative companies such as Sunway are showing that it is perfectly possible to do well by doing good. 

 "Given the state of the planet today, I firmly believe that implementing the sustainability agenda is no longer an option but an urgent imperative," Dr. Jeffrey Cheah said. "My vision is for Sunway to be Asia's model corporation in sustainable development, innovating to enrich the lives for a better tomorrow."

This post was created by Insider Studios with Sunway.