Saving our seafood, from boat to bowl
2in the news
4Green innovators of ESG PIA to be known soon
15SBTi symposium explores climate action, businesses to embrace climate responsibility and innovation
16Genting Sustainbiz F&B Expo poised to become premier hub for knowledge-sharing
5Landmark launch of A-EPIC: Asia’s first cross-border media alliance to advance ESG
8Ech0es of optimism
12Assessing Malaysia’s food security efforts
14Navigating the challenges and opportunities for sustainability in retail
21The path to safe sustenance
6The fall of the forest-based carbon offset: A cautionary tale for Malaysia
17Too hot to handle?
22Dining out sustainably
19Culinary innovation meets sustainability
20First-movers will capture outsized returns in South-East Asia’s biofuels market
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MALAYSIA, a nation blessed with rich marine biodiversity, has long relied on its fisheries sector as a vital source of food and livelihood. Our coastal communities depend heavily on the health of our oceans, providing over a third of the country’s animal protein and supporting the livelihoods of more than 120,000 fishers and fish farmers.
Despite its importance, our fisheries face a looming challenge. Overfishing, habitat destruction, and high consumption have drastically depleted fish populations, throwing our marine ecosystems out of balance and endangering our food security. While statistics show a stable rate of fisheries production and a steady 1% contribution to gross domestic product (GDP), we face an important challenge – the decline of demersal fisheries by 88%, a crucial part of our marine resources.
Addressing this issue presents huge opportunities and allows us to create a more sustainable and prosperous future.
The state of our fisheries
Picture this: There are no more fish in our seas. That’s the grim possibility we will face if we don’t act now.
Under the “business-as-usual” scenario, Malaysia’s fisheries production continues to meet national targets. However, these targets are quantitative and not a reflection of the real shift in the quality and composition of fish caught. Our demersal fish biomass and densities have dropped by 88% as compared to the virgin stock levels in the 1960s.
2020 data shows Malaysians consume an average of 53kg of seafood per capita, which is way above South-East Asia’s average of 40kg and the world’s average of 20kg.
With the drastic decline of wild fish stock, we must find alternative solutions. Sustainable aquaculture is now recognised as a solution to address the gap between declining wild fish stock and growing demand for seafood. In truth, non-responsible conventional aquaculture has numerous environmental challenges including a high reliance on wild fish in aquaculture feed, causing further pressure on our fisheries.
If we don’t act now and proceed with “business-as-usual” practices, our fish stocks may not survive another 30 years.
Addressing this emergent food security crisis, at WWF-Malaysia, we devise a “boat to bowl” conservation approach that unites stakeholders and partners across sectors. In support of the Department of Fisheries Malaysia, this comprehensive strategy aims to promote sustainable fisheries and aquaculture, as well as responsible seafood consumption - which in turn secures seafood supply and supports the livelihoods of coastal communities.
Swimming in innovation
One exciting aspect of our “boat to bowl” strategy is the collaboration between aquaculture industry stakeholders, including farmers, government officials, and researchers. By working together, we aim to develop the industry sustainably while protecting important habitats, using responsible aquaculture tools, and adopting climate-resilient technologies.
One such innovation is offshore farming with high-density polyethylene (HDPE) cages.
Despite relatively higher investment, these robust cages which are designed for long-term use in harsh marine environments, offer a promising solution for food security and climate change adaptation.
Another exciting initiative is our pilot project using circular economy principles to improve aquaculture practices and reduce pressure on wild fish stocks.
Through a partnership between the aquaculture and hospitality sectors, food waste from hotels is diverted from landfills into a bioconversion facility. The facility then produces protein from black soldier fly larvae, which is used in aquaculture feed.
This reduces the dependency on wild fish protein and promotes sustainability - a true win-win, turning waste into wealth.
WWF-Malaysia continues to support the Department of Fisheries Malaysia in the implementation of the National Fisheries Development Plan 2021-2030. By collaborating with coastal communities, the fishing and aquaculture industry, and seafood buyers, we assist the Department of Fisheries Malaysia in improving sustainable fisheries practices at both regional and national levels.
This, in turn, benefits our local communities and businesses, consumers and the environment.
Catching challenges and reeling in opportunitiesDespite these efforts, challenges persist. Sustainable seafood suppliers are limited in Malaysia.
Consumers can’t buy sustainable seafood in part due to local businesses avoiding sustainable seafood purchases caused by higher costs and supply chain bottlenecks.
Zooming out regionally, the majority of the sustainable seafood production from the Asia-Pacific region is exported to other countries. As this scenario continues, it becomes more challenging to promote domestic uptake of sustainable seafood.
However, opportunities are abound. The local hospitality and fine dining industries, for example, are ripe for exploring sustainable seafood sourcing.
Sustainable seafood sourcing practices vary across industries in Malaysia. The hospitality industry, driven by international hotel brands aligning with global sustainability goals, is more receptive to sustainable seafood sourcing.
The retail industry too has significant room for improvement. As evidenced by a mere 25% score in WWF-Malaysia’s Sustainable Retailers Scorecard 2019 report, every two out of five assessed retailers established a seafood procurement policy that avoids sourcing endangered species.
The opportunities are ready for the retail industry to reel in and see the benefits of sustainability.
Making waves in conservation
Can you picture your favourite seafood dish disappearing from the menu?
The production, consumption, and waste of food are the single largest human pressure on nature.
Conserving marine resources requires efforts to sustain seafood production, improve seafood sourcing, make responsible seafood choices and reduce food waste. Both consumers and businesses play crucial roles in this effort.
Daily consumption habits, business operations, and event planning should all reflect a commitment to food sustainability. For example, both businesses and consumers should avoid endangered species and seafood listed in the “Avoid” category of WWF-Malaysia’s Save Our Seafood Guide, opting instead for those in the “Best Choice” list.
However, the best form of consumption is always in moderation.
Dive into actionOur nation’s future depends on the health of our oceans. Let’s make responsible choices, support sustainable practices and work together to ensure our seas remain bountiful for generations to come.
So, next time you enjoy a seafood meal, remember its journey from boat to bowl and the efforts to keep our oceans vibrant. Let’s reel in the positive changes together. Can you imagine a world without the taste of fresh seafood? Neither can we.
So join the movement, make a difference, and let’s keep our oceans teeming with life.For more insights and ways to get involved, dive into the resources available at SaveOurSeafood.my. It’s time we all become champions for our seas.Chitra Devi is WWF-Malaysia’s Marine Programme leader. The views expressed here are the writer’s own.
• Tenaga Nasional Bhd (TNB) is preparing for Regulatory Period 4 (RP4) 2025-2027 with significant capital expenditure (capex) to support Malaysia’s energy transition and projected growth in electricity demand.
“We are ready to execute major initiatives under the National Energy Transition Roadmap (NETR), ensuring Malaysia achieves its energy-transition goals. With TNB leading the charge, we are confident in fostering a sustainable, resilient, and prosperous future for all,” TNB president and chief executive officer Datuk Megat Jalaluddin Megat Hassan said in a statement.
• Malakoff Corp Bhd is acquiring a 51% equity interest in ZEC Solar Sdn Bhd and a 49% stake in TJZ Suria Sdn Bhd from Zelleco Engineering Sdn Bhd for RM27mil.
In a filing with Bursa Malaysia, Malakoff said ZEC Solar is the owner and developer of a large-scale solar photovoltaic (LSSPV) facility with a capacity of 29 megawatts alternating current, located in Kota Tinggi, Johor under the large-scale solar programme with a 21-year solar power purchase agreement until 2040.
• Sarawak has set an ambitious target of raising its power generating capacity to 10 gigawatts (GW) by 2030 to meet the robust demand for green energy by new industries like those to be set up in the Sarawak Energy Hub in Bintulu.
The generation of up to 10GW of electricity will primarily come from renewable sources such as hydropower, solar, gas turbines and biomass energy, according to Sarawak Premier Tan Sri Abang Johari Tun Openg.
• Malayan Banking Bhd (Maybank) will launch white papers on its net-zero pathway for two sectors – oil palm and power – that will be going public to inform on the bank’s method to reduce carbon emissions by 2030.
Group president and chief executive officer Datuk Khairussaleh Ramli said the white paper was a crucial step to have a clear plan and action for Maybank to be able to achieve net zero.
• Genetec Technology Bhd anticipates increasing demand for its automation and energy storage solutions as customers continue to execute their production plans.
The tech company said securing recurring orders in the electric vehicle (EV) and energy storage segments are expected to anchor Genetec’s earning prospects in the coming quarters.
• Press Metal Aluminium Holdings Bhd is poised to capture emerging aluminium markets by recalibrating strategies, expanding into new areas and aligning with manufacturing relocations outside China.
“Despite subdued construction and property sectors, global investments in renewables and electric vehicles continue to drive the demand for aluminium.
“As climate challenges intensify, accelerating green initiatives is crucial. Press Metal remains committed to providing sustainable aluminium products, contributing to a green future,” group chief executive officer Tan Sri Paul Koom said in a Bursa filing.
• The rationalisation of diesel and petrol subsidies may increase the appeal of electric vehicles (EVs) compared with the internal combustion engine (ICE). Within ongoing plans by the government to beef up the EV charging infrastructure, it could be a matter of time before registrations of such vehicles pick up pace and grow further.
“We foresee an encouraging growth of EV adoption locally and Sime Darby Motors is ready to support the EV ecosystem in Malaysia.
“We are proactively accelerating the transition to EVs in the automotive sector, spearheading Malaysia’s aspirations for a low-carbon mobility future,” Sime Darby Motor managing director of South-East Asia Jeffrey Gan said.
• Affin Hwang Investment Bank Research (Affin Hwang) said the upcoming implementation of the third-party access (TPA) in the country’s electricity supply industry will likely cover both renewable energy (RE) and non-RE.
This should increase the vibrancy in the power generation industry and benefit the companies including the RE and non-RE independent power producers (IPPs) and solar engineering companies/ services providers.
• Malaysia Marine and Heavy Engineering Holdings Bhd (MMHE), via its wholly-owned and major subsidiary, Malaysia Marine and Heavy Engineering Sdn BHd, has secured a RM1.5bil award to build an offshore substation (OSS) high voltage direct current platform consisting of topside and jacket from Petrofac International (UAE) LLC.
In a filing with Bursa Malaysia, the group said the project, named the Nederwiek 1, underscored MMHE’s commitment to sustainable energy infrastructure development.
“Serving as a vital component of TenneT’s 2GW programme in the Netherlands, the OSS reaffirms its pivotal role in advancing clean energy solutions,” it said.
• Nestcon Bhd has secured a RM3.6mil contract to develop and install a solar photovoltaic (PV) system in Subang Jaya, Selangor.
In a filing with Bursa Malaysia, Nestcon said Nestcon Solar Sdn Bhd, a wholly-owned subsidiary of Nestcon Sustainable Solutions Sdn Bhd (which is 51%-owned subsidiary of Nestcon), had entered into an agreement with Subang Safety Glass Sdn Bhd (SSG) to develop, design, install, construct and commission the PV system at the rooftop of SSG’s premises.
• OCBC Bank (M) Bhd has pioneered the inaugural Islamic Sustainable Financing Facility for Permodalan Nasional Bhd’s (PNB) wholly-owned subsidiary, PNB Jersey Ltd, with a RM1.2bil Islamic Green Financing Facility (Green Facility).
• Malaysia Marine and Heavy Engineering Holdings Bhd’s (MMHE) subcontract win worth RM1.5bil to build an offshore substation at a wind farm in the Netherlands is a shot in the arm for the group, analysts say.
Not only would it have the potential to boost its earnings and the size of its order book, but the contract will pave the way for MMHE to achieve its environmental, social and governance (ESG) goals, they said.
• Hartalega Holdings Bhd announced the results of its inaugural life assessment study on the carbon footprint of three of its key glove products, including the BDG Nitrile Biodegradable Glove, Standard Nitrile Glove, and COATS Colloidal Oatmeal Coated Glove.
Hartalega said it was the first glove manufacturer in the industry to publicly disclose the reviewed carbon footprint data for its products, further cementing its commitment to drive environmental, social and governance (ESG) practices while achieving greater transparency in sustainable glove productions.
• The Securities Industry Development Corp (SIDC) has introduced new initiatives under the Industry Competency Framework (ICF) to address the growing demand for sustainable and responsible investments and shariah-compliant products and services.
In a statement, SIDC said there will be two new competencies covering the fundamental components of sustainable and responsible investment products and their analysis.
• UOB Malaysia has signed a memorandum of understanding (MoU) with SEDC Energy Sdn Bhd to support businesses in Sarawak as well as the state’s energy sector.
SEDC Energy which is a subsidiary of Sarawak Economic Development Corp stated UOB Malaysia will provide financing facilities to SEDC Energy’s supply chain consisting of suppliers. vendors and contractors.
• Cypark Resources Bhd’s 100 megawatts (MW) large scale solar 3 (LSS3) hybrid solar energy plant in Merchang, Terengganu, has successfully reached its commercial operation date (COD) on June 9, 2024.
In a statement, Cypark said this marked a significant achievement in supporting Malaysia’s ambition for a 70% renewable energy mix by 2050.
• With Malaysia expected to aggressively ramp up the installed capacity for renewable energy (RE), particularly, solar, there is a likelihood of a huge pipeline of projects for players.
UOB Kay Hian (UOBKH) Research, in a report initiating coverage on the RE sector, expects coverage on the RE sector, expects a total value of RM5.6bil to RM7bil in engineering, procurement, construction and commissioning (EPCC) contracts to be rolled out in the next one to two years under the Corporate Green Power Programme (CGPP) and the fifth round of the Large-Scale Solar (LSS5).
• SD Guthrie Bhd is in a favourable position to ramp up its future renewable energy (RE) business, partly thanks to the recently launched Kerian Integrated Green Industrial Park (Kigip) master plan in Perak.
Maybank Investment Bank Research said besides Kigip, Penang could also be a potential buyer of RE from SD Guthrie’s solar farm at Kigip to offset carbon dioxide generated at its Silicon Island project.
• Renewable energy (RE) investment will be a key focus area under Sarawak’s Post Covid-19 Development Strategy (PCDS) 2030 to position the state on a sustainable growth trajectory.
According to InvestSarawak chief executive officer Timothy Ong, one of the immediate goals to be undertaken for the rest of 2024 involved firming up the strategic direction of the agency in terms of focus investment areas.
• Kenanga Research anticipates the renewable energy (RE) sector to see billions of ringgit of investments in the next two years, mainly in solar-based generation assets.
The research house noted that solar photovoltaic (PV) system engineering, procurement, construction and commissioning (EPCC) contractors like Solarvest Holdings Bhd and Samaiden Group Bhd could be the major gainers from the execution of various contracts under the Corporate Green Power Programme (CGPP), which is estimated to be worth RM2.4bil, as well as the two gigawatts (GW) large-scale solar five (LSS5) that is worth another RM5bil, not to mention the additional quota of 500 megawatts (MW) on offer under the net energy metering (NEM) scheme. • Biomass boiler company BM GreenTech Bhd’s move to acquire solar firm Plus Xnergy Holdings Sdn Bhd (PXH) is a positive one, which will boost and strengthen the group’s solar business.
Kenanga Research said it views the deal positively as it would strengthen the group’s solar segment by expanding its portfolio to large-scale solar projects.
ESG Opportunities
Sustainability specialist, Maxis - Kuala LumpurInterested applicants will be responsible for leading end-to-end project management for sustainability initiatives. This includes engaging stakeholders, tracking and evaluating effectiveness, executing impactful campaigns and events, managing reporting, developing policies, providing strategic support, and ensuring regulatory compliance. The role requires a minimum of 5 years of project management experience with a sustainability focus.
Mechanical engineering intern, Urban Farm Tech Sdn Bhd - CyberjayaThe mechanical engineer intern to assist in designing, testing and optimising mechanical components and systems for urban farming solutions. Responsibilities include prototyping, data analysis, collaboration with cross-functional teams and documentation. Qualifications include pursuing or completing a degree in Mechanical Engineering, proficiency in CAD software and a passion for sustainable agriculture. Benefits include hands-on experience, exposure to innovative technologies and networking opportunities.
THE upcoming inaugural Genting Sustainbiz F&B Expo is set to be the premier curated trade show highlighting a number of key green economy segments and sustainable future within the food and beverage (F&B) sector.
Resorts World Genting (RWG) will be hosting this three day event that will run from Sept 10-12 this year from 10.30am to 6pm.
The expo will be organised in collaboration with Comexposium Sdn Bhd, a leading F&B trade shows organiser in Malaysia, and the event is poised to bring together the brightest minds, innovative solutions and forward-thinking businesses from around the world.
It is expected to see some 80 local and international exhibitors, hosting up 100 local and international buyers and attracting 3,000 visitors internationally.
Scheduled to take place at Genting International Convention Centre (GICC) located 6,000 feet above sea level, this groundbreaking event will be a game-changer for the F&B industry as it is one of the first-ever sustainable F&B expo to be held at this unique high-altitude destination.
An opportunity for unique product showcases
The expo aims to showcase the latest advancements in sustainable food production, packaging, waste management, green technologies and more that are shaping the future of the F&B industry.
From plant-based innovations and regenerative agriculture to renewable energy and eco-friendly equipment, the Genting Sustainbiz F&B Expo is also aligned with RWG’s dedication to a sustainable future where its actions positively impact the planet and communities it serves.
Foster collaboration and networking
The expo will be carefully curated to cater to a diverse range of target exhibitor and visitor segments, ensuring a comprehensive representation of the sustainable F&B network.
The exhibitor segments include but are not limited to: sustainable food production, sustainable packaging solutions, plant-based innovations, food waste management solutions, sustainable seafood practices, green beverage production, renewable energy for F&B operations, food safety and sustainability integration, organic food and fair trade products, local and seasonal produce, regenerative agriculture practices and more.
These exhibitor segments represent the key areas of focus for the event, providing a platform for businesses and organisations to showcase their innovative solutions and connect with a targeted audience of industry professionals, sustainability advocates, entrepreneurs, academics and policymakers.
Attendees of the Genting Sustainbiz F&B Expo will also get the opportunity to discover the latest trends, network with industry leaders, attend informative workshops and seminars and explore diverse sustainable F&B products and services.
Attendees stand to gain valuable insights, forge meaningful connections and stay at the forefront of the sustainable F&B market.
Connect with key industry players
This expo has garnered a strong turnout
of exhibitors who have joined with confidence, highlighting the event’s robust reputation and appeal.
Among these esteemed participants are Aqina Farm , Farm Fresh, CoffeeBot , Cremer Sustainable Foods (Singapore) and Kimberly Clark Professional, just to mention a few.
The presence of such reputable exhibitors not only enhances the expo’s prestige but also promises a rich array of insights and advancements for attendees to engage with.
Enhance brand value
In this expo, exhibitors can also connect with like minded audience that share the same value of shaping a greener world together. The sustainability movement is a critical factor in today’s market and brands stand to enhance their value by positioning their companies at the forefront of the sustainability movement.
Moreover, this expo is supported by the Malaysia Convention & Exhibition Bureau (MyCEB) as strategic partner and VISA as the platinum sponsor.
Gain access to workshops and panel discussionsBeing a three-day expo, attendees can look forward to a variety of engaging activities, including business matching sessions, product launches and panel discussions featuring industry experts.
One of the event’s most anticipated highlights is the live cooking demonstration by RWG’s star chefs, showcasing their culinary expertise and commitment to sustainable practices.
Additionally, the Hosted Buyer Programme will provide a unique opportunity for top-tier buyers to connect with exhibitors and to foster valuable business partnerships.
Whether you’re an exhibitor seeking to showcase your innovative solutions, a visitor eager to discover the latest trends, or a brand aiming to amplify your company’s sustainability credentials, Genting Sustainbiz F&B Expo offers everyone opportunities to be part of the journey in shaping a greener world.For more information about the highly anticipated event, log on to rwgenting.com/sustainbiz
The scenic Iroise coast in Brittany, France, was a place shrouded in mystery. No one could figure out why pieces of bright orange landline novelty phones in the shape of the famous cartoon cat, Garfield, would constantly wash up on its beaches. After more than 30 years, a local farmer finally solved the mystery.He led a team of anti-litter campaigners and media to a hidden sea cave where a lost shipping container, which washed up during a storm in the 1980s, was found along with the remaining Garfields. It was reported that the farmer was only a young man when Garfield began making an appearance on the beaches after a storm in the early 1980s.
Despite such a long period of time, the orange tabbies that were found in the destroyed shipping container were in a more complete condition than any found before them. However, the multiple Garfields’ conditions were unsurprising given that they are made of plastic - one of the hardest components in the world to break down.
Based on the US’ National Oceanic and Atmospheric Administration (NOAA) and Woods Hole Sea Grant, which compiled data showing the length of time for man-made marine debris to biodegrade in the sea, it is found that fishing lines are the worst offender, taking up to 600 years to biodegrade.
Disposable diapers and plastic bottles take 450 years to break down; plastic shopping bags will take up to 20 years; takeaway styrofoam coffee cups take 50 years; and cigarette butts take 10 years to break down.
Meanwhile, the United Nations reports that plastic waste is here to stay. Though it would take anywhere from 20 to 500 years to decompose, it never fully disappears. These plastics just get smaller and smaller - turning into microplastics that are eaten by marine creatures and end up in food ingested by humans. With these scenarios in mind, one cannot help but wonder how much microplastics and other foreign material humans are unknowingly ingesting.How safe is my food?
The United Nation Development Programme (UNDP) notes that microplastics have become a matter of growing concern for the environment and human health, with recent evidence indicating that humans constantly inhale and ingest microplastic through contaminated seafood, including fish and shellfish. UNDP also points out that microplastics - tiny particles of plastic less than 5 millimetres in size - have been found in tap water, bottled water, and even commonly consumed beverages, such as beer and salt.
Ingesting microplastics can damage human cells, decrease reproductive health and disrupt the endocrine system, according to researchers.
Microplastics also act as a vessel for harmful substances to enter the body as they can absorb chemicals linked to cancers and weakened immune systems. A study titled Global Pattern of Microplastics in Commercial Food-Grade Salts: Sea Salt as an Indicator of Seawater Microplastics Pollution, estimates that the average adult consumes approximately 2,000 microplastics per year through salt.
Currently, there is no hard data on how much microplastics Malaysians are ingesting. However, it is believed that the amount is substantial as Malaysia—whose people’s staple includes quite a bit of seafood—is ranked third after the Philippines and India in the list of countries contributing most to marine plastic pollution, according to Dutch academic Lourens JJ Meijer’s study published in 2021.
In another report featuring Universiti Putra Malaysia Associate Professor Dr Sarva Mangala Praveena Appalanaidu, found that microplastic pollution in the environment raises concerns about their accumulation in the marine ecosystem which affects the food chain, with potential health implications for marine life and humans.
To put it simply, food safety is defined as measures taken to ensure that food is free from harmful agents, such as bacteria, viruses, chemicals and is safe for consumption. Food security refers to the accessibility, availibity and affordability of a sufficient amount of food to meet the dietary needs and preferences of individuals.
Though differing in concepts, these two are related and require effort from authorities, policymakers and consumers alike in assuring that food is safe from a chemical, physical or biological aspect..
Taking a holistic approach
Malaysia is ranked moderately in the Global Food Security Index (GFSI), an annual assessment measuring food security through affordability, availability, quality and safety, as well as sustainability and adoption. Malaysia was ranked 41st in GSFI 2022, 39th in 2021, 48th in 2020 and 28th in 2019.
However, the question remains - why are there still Malaysians going to bed hungry? It has also been reported that in some tragic cases, some resort to rummaging through landfills for sustenance.A World Bank report titled Agricultural Transformation and Inclusive Growth stated that Malaysia, in actual fact, does not produce enough food to feed its people and industries, with agricultural productivity being only 45% of the average for high-income countries. This indicates that there are deep-rooted issues that require further intervention from authorities and policymakers. Currently, the government has already put in place a number of initiatives and policies.
Agriculture and Food Security secretary-general Datuk Lokman Hakim Ali shares that to tackle food security issues in the country, the government has been focusing on four pillars outlined by the Food and Agriculture Organization (FAO), in line with the National Food Security Policy Action Plan 2021-2025 and National Agro-Food Policy 2021-2030 (NAP2.0). NAP2.0 was developed in alignment and support of other national development agenda policies including Vision for Shared Prosperity 2030 (WKB 2030) and Malaysia’s Five Year Plan.
He says the ministry believes that the domestic food supply is sufficient to meet domestic needs for eight main commodities namely chicken, meat, fresh milk, eggs, fish, fruit, vegetables and rice. He did, however, acknowledge that Malaysia’s dependence on imports has been increasing and the government has incorporated strong policies which include diversifying imports, seeking efficient sources and strengthening growth strategies of rice in Malaysia. This is in addition to conducting pilot programmes, initiatives on crops.
“We have good policies in place to ensure we are able to maintain a sustainable food future for our people. Of course there is always room for improvement and we are seeking to boost access to food,” he told StarESG when he attended the Asia ESG Positive Impact Consortium (A-EPIC) launch at the Sime Darby Convention Centre last Friday (June 21) with Prime Minister Datuk Seri Anwar Ibrahim and Natural Resources and Environmental Sustainability Minister Nik Nazmi Nik Ahmad.
Additionally, news reports in early June noted that Lokman Hakim has assured Malaysia has enough rice stock to last five to six months, standing at 1,128,165 metric tonnes up to June 18. Pointing out that the ministry constantly ensures the commercial rice stock exceeds the country’s monthly needs, he shares that rice stock in the country at the mill, wholesale and retail levels is 752,447 metric tonnes, with 107,757 metric tonnes being transferred from ships and 67,961 metric tonnes in local paddy.
He adds that the government also has a buffer stock of 200,000 metric tonnes of rice ready to be used for emergencies, like a global food crisis or a state of emergency.
Meanwhile, food wastage remains a pressing matter in Malaysia. According to reports, Malaysians waste approximately 16,720 tonnes of food daily (this accounts for 44% of the total waste), with households contributing the largest amount of food waste across the country, followed by night and wet markets, food courts and restaurants, hotels, and food and beverages industry.
All the wasted food will end up in our landfills, where it decomposes slowly and releases harmful substances such as methane—a greenhouse gas that is estimated to be 25 times more potent than carbon dioxide—into the atmosphere.
Shaping the nation’s food future
To advance food security for the nation and her people, the Institute of Strategic and International Studies (ISIS) Malaysia suggests policymakers to strike a delicate balance between self-reliance and self-sufficiency in the context of food systems, boost food resilience and more.
The policy brief titled Malaysia’s long-term food security: The path beyond self-sufficiency ratios and import-dependent ratios stated that the existing overemphasis on self-sufficiency ratios and import-dependency ratios could lead to inefficiencies and limited resilience. Comprehensive and holistic food security systems should extend to the dimensions of accessibility, utilisation, stability, sustainability and agency.
The paper also highlights the need to strike a balance between self-reliance and self-sufficiency to address future disruptions. It stated that Malaysia’s food security should focus on household financial ability, nutritional status and resilience, rather than solely on national production and self-sufficiency.
“Rather than the current overt reliance on self-sufficiency, which often results in inefficiencies and limited resilience, a more pragmatic approach would be to emphasise self-reliance involving the production of a comfortable or strategic level of self-sufficiency coupled with the ability to strategically source the balance, wherein nations hone their ability to adapt, innovate, and respond to disruptions.
“A more holistic approach to food security is important, recognising that self-sufficiency alone is inadequate to address the growing nutritional needs, especially of Malaysia’s lower-income segments.
“The approach of food self-reliance must extend beyond quantity to incorporate nutrition and dietary perspectives, ensuring that the requirements of the people are met comprehensively,” according to the brief.
Furthermore, Malaysia is encouraged to leverage on and actively promote and pursue food diplomacy in relation to food security through its membership in selected multilateral and regional frameworks as well as bilateral arrangements.
“Towards this end, key stakeholders in other ministries and the private sector will be increasingly involved in a whole-of-nation effort in pursuit of these strategic arrangements, which will enhance Malaysia’s long-term food security. Multiple policies across eight ministries along with varying local-level considerations challenge coordination, policy coherence and effective governance.
“As food systems are multifaceted and multidisciplinary, coordination among government agencies, periodic reviews and improvisation in state-level participation to address varying food security challenges are pivotal,” stated the brief.
Separately, independent think-tank Emir Research founder and non-executive chairman Datuk Wira Dr Rais Hussin Mohamed Ariff—an avid strategist with over 26 years of experience—has observed that leading countries in GFSI share a common practice. They place emphasis on efforts in boosting agri-food technology - “all as one place hi-tech farming, precision engineering and circular economy principles as the cornerstone of their national food security strategies”.
Rais Hussin notes that other common trends among these countries include: > Placing food security at the highest priority level by the state administration in the form of explicit national food security strategy and dedicated ministries or agencies.
> Spear-heading national policies towards food self-sufficiency.
> Heavy investment in agri-tech research and development.
> Particular focus on small farmers and local agri-techpreneurs via innovative financing, incentive schemes, and connecting them into extensive networks and e-commerce channels, to allow these small players to collectively bring their produce to the local market to be price-competitive. This addresses the middle-men issues.
> Successful countries build entire vibrant and healthy ecosystems around their agricultural sector infused with tech, including producers, financiers, policymakers, educators and even consumers.
> Irrespective of land and other natural resources size and availability, these countries venture into the area of vertical complete control environment farming.
> Preparing local agri-tech specialists at scale.
> Deploy various strategies to encourage youth to relocate to rural areas and develop rural regions, turning them into attractive places to reside in.
“Spearheading national policies towards self-sufficiency is yet another common trend shared by top league food security performing-countries. These countries probably have realised heavy-reliance on imports as a threat to their national security,” according to Rais in an opinion piece.
In summary, securing Malaysia’s food security and safety would require a substantial amount of funding. Food systems account for around a third of global emissions, and naturally, the agricultural sector itself is a significant contributor to greenhouse gas emissions.
However, The World Economic Forum’s paper Green Returns: Unleashing the Power of Finance for Sustainable Food Systems, has found that just under 4% of climate finance is allocated to agriculture and food.
To advance the agricultural sector, more funds will need to be injected to get the ball rolling.
With a collective reach of over 123 million people, three regional media powerhouses joined forces on June 21 to form the Asia ESG Positive Impact Consortium (A-EPIC), the first of its kind in Asia. The launched was graced by Prime Minister Datuk Seri Anwar Ibrahim who officiated the event on June 21.
The consortium aims to further efforts in promoting progressive environmental, socio-economic and governance commitments for future prosperity across the region.
Comprising Star Media Group (SMG), Indonesia’s Media Group of Kompas Gramedia (KG Media) and the Inquirer Group of Companies, the three influential media partners are joining hands to promote progressive environmental, socio-economic and governance commitments for future prosperity across the region.
Also present were Natural Resources and Environmental Sustainability (NRES) Minister Nik Nazmi Nik Ahmad, SMG chairman Tan Sri Wong Foon Meng, SMG chief executive officer (CEO) Chan Seng Fatt, KG Media chief CEO Andy Budiman, Philippine Daily Inquirer president and CEO Rudyard Arbolado, and Sime Darby Property Bhd (SDP) group managing director Datuk Azmir Merican.
The three media organisations aim to drive the adoption of environmental, social and governance (ESG) principles by delivering informative content that will inspire and empower audiences, and facilitate meaningful collaborations with key stakeholders.
SDP was also announced as the Urban Biodiversity Partner for the consortium’s flagship initiatives.
The recent launch of the Asia ESG Positive Impact Consortium (A-EPIC) at the Sime Darby Convention Centre on June 21 was met with enthusiasm from attendees. Recognising the pressing global issues of climate change, social inequalities and governance challenges, they view ESG principles as essential to shaping a sustainable and secure future. In a significant partnership, Sime Darby Property Bhd was also named the Urban Biodiversity Partner for A-EPIC’s flagship initiatives, underscoring the consortium’s commitment in driving impactful solutions across the region. “We must recognise that achieving net zero requires a collaborative effort involving all – the government, the private sector and the people. This is where I believe the formation of the Asia ESG Positive Impact Consortium (A-EPIC) is timely where it can leverage the prowess of three media groups to facilitate collaborative action between stakeholders, businesses and the public.” Prime Minister
Datuk Seri Anwar Ibrahim:
IN recent years, Malaysia has grappled with a concerning trend in its food trade imbalance, marked by a significant increase in food imports compared to exports. The numbers paint a stark picture: in 2022 alone, Malaysia imported RM75.6bil worth of food products while exporting only RM44.6bil. This import trend has been steadily rising, indicating a growing dependency on foreign food sources and a concerning trade deficit. Despite the government’s efforts to bolster food security through various initiatives and budget allocations, the nation still faces challenges in achieving self-sufficiency in key food staples such as beef, mutton, chili and rice.
With a new government in power since the 2022 elections, there were hopes for renewed focus and commitment to addressing Malaysia’s food security concerns. However, the effectiveness of these efforts remains under scrutiny.
National Agrofood Policy 2.0
The National Agrofood Policy 2.0 represents a significant step forward in addressing the challenges faced by Malaysia’s agro-food sector. This policy acknowledges the shortcomings of its predecessor and aims to tackle various dimensions of food security, including availability, access, utilisation and stability.
Emphasising principles of economy, social welfare, and environmental sustainability, the policy outlines a comprehensive approach to enhancing food production and distribution.
One of the critical issues highlighted by the policy is the socioeconomic status of small-scale food producers, who constitute a significant portion of the agricultural sector. Despite their importance, these producers often face low incomes and limited access to resources, hindering their ability to contribute effectively to food production. Addressing these challenges requires not only financial support but also initiatives to improve the quality of life and opportunities for small-scale farmers.
While the National Agrofood Policy 2.0 offers promising objectives, questions remain regarding the government’s commitment to implementing necessary technologies and innovations in agriculture.
Although there have been investments in research and development, small-scale farmers continue to grapple with issues such as poor-quality seeds and inadequate management practices. It is essential to prioritise investments that directly benefit farmers and enhance their productivity and livelihoods.
Moving forward, it is crucial to set realistic targets and indicators for the implementation of agricultural technologies and automation. While these innovations hold the potential to transform the agriculture industry and improve food security, they must be accompanied by measures to address underlying challenges and ensure the welfare of farmers, prioritising the needs of small-scale farmers and ensure that technological innovations are effectively deployed to enhance productivity and livelihoods. By taking a holistic and humanistic approach to food security, Malaysia can overcome its current challenges and build a more sustainable and resilient agro-food sector.
Malaysia’s food security efforts require a comprehensive and coordinated approach that addresses both policy frameworks and implementation strategies. Only through concerted efforts and meaningful interventions can Malaysia achieve its goal of self-sufficiency in food production and ensure the well-being of its citizens.‘Stork birdy stork’ habit and recognition of root problems
A statement from the Selangor State Legislative Assembly (DUN) earlier on Feb 28 this year blamed farmers for low productivity without considering underlying factors which was counterproductive. The assertion that farmers’ failure to follow standard operating procedures (SOP) is the main cause of the reduction in paddy production highlights a concerning trend of scapegoating rather than addressing systemic issues.
The tendency to blame farmers for productivity issues, often without sufficient evidence or consideration of external factors, is a recurring problem in agricultural policy discussions. This “stork birdy stork” habit of shifting blame onto farmers must be replaced with a more humanistic and proactive approach.
Instead of adopting a reactive stance, the government should prioritise comprehensive research that incorporates farmers’ perspectives and expert views. By involving farmers in the research process and considering their lived experiences and challenges, policymakers can gain valuable insights into the root causes of productivity issues. This approach allows for the development of more effective and inclusive policies that address underlying structural barriers and support farmers in improving productivity sustainably.
Moreover, the inability to recognise systemic issues related to government agencies, market chains, and market monopolies exacerbates agricultural challenges in Malaysia. Issues such as missing local stock and poor seed distribution persist due to a lack of acknowledgment of these underlying structural problems.
In spite of the initiatives outlined in the Malaysia Food Security Action Plan 2021-2025, such as the establishment of a command centre to collaborate with agencies like the Investment, Trade and Industry Ministry (Miti), the National Security Council (MKN) and the Health Ministry (KKM), systemic issues persist.
While these initiatives aim to manage food security issues more systematically, there is a need for sustained, long-term action rather than reactive measures. Instead of exist in a short period of time, the proposed command centre should operate proactively, continuously monitoring and evaluating all aspects of the agricultural supply chain, from seed distribution to market sales.
Using a proactive stance, Malaysia can identify and address potential issues before they escalate into crises, thereby enhancing agricultural resilience and stability. Furthermore, instead of solely focusing on short-term fixes, the command centre should compile comprehensive annual reports for the government. These reports should outline strategies to tackle systemic issues within the agricultural sector, including improving seed distribution networks, enhancing market transparency and addressing market monopolies.
Through the introduction of the National Agrofood Policy 2.0, which represents a significant improvement over its predecessor, there is an urgent need for proactive and humanistic implementation. It is essential to address underlying and often overlooked issues within the agricultural sector.
Recognising that agricultural challenges stem from systemic issues rather than the fault of any single sector is crucial. Only through comprehensive reforms can we truly tackle these challenges effectively and ensure the long-term sustainability of our food. Furthermore, fostering a culture of collaboration and mutual respect between policymakers, researchers and farmers is essential for achieving meaningful progress in food security efforts.
Rather than shifting blame, there should be a concerted effort to work together towards shared goals, with a focus on empowering farmers and strengthening the resilience of our agricultural sector.The views expressed here are the writer’s own.
SO FAR, 64 out of 287 submissions from small and medium enterprise (SME) business, mid and large tier companies have made it past the first round of judging for Star Media Group’s (SMG) ESG Positive Impact Awards (ESG PIA) 2023, with some ties among the enterprises.
Judging began on June 6 and lasted till June 19. There were 21 judges in total, who were given an hour-long briefing by auditor EY before reviewing and marking each participating company’s environmental, social and governance (ESG) initiatives conducted in the previous year.
The judging sessions, which lasted two weeks, were conducted virtually for the judges’ convenience and time. The second round of judging was held on June 27 and completed within the same day.
SMG launched the ESG PIA in 2022 to acknowledge enterprises that have integrated ESG principles into their core strategies and also create a more comprehensive measure of success.
By doing so, the ESG PIA amplifies the influence and importance of people, planet and profit (3Ps) in the corporate realm, nurturing an environment where businesses proactively align with values that prioritise societal welfare, environmental stewardship and financial viability.
Last round’s event saw 60 awards given out to 100 companies for driving positive change and inspiring others in the country to embrace sustainability.
Entering its second edition this year, the ESG PIA 2023 categories are divided within the three main ESG pillars, with the Environment Awards covering Sustainable Ecosystems, Water Management and Efficiency, Waste Management, Responsible Consumption and Production, Renewable Energy and Energy Efficiency.
The Social Awards covers Diversity, Equity and Inclusion; Relations with Local Communities; Human Rights and Labour Standards; Talent Management; and Good Health and Wellbeing.
The Governance Awards has one category that focuses on Governance, Reporting and Transparency.
There are also three standalone awards that are related to ESG and grouped under Other Awards category and these include Supply Chain Management, Innovative Partnership and Transformation.
This edition, OCBC Bank (Malaysia) Bhd also returns as the main sponsor of the awards.
Ernst & Young is the adviser of the awards, while working partners include:
> ABAC Centre of Excellence
> Business Council for Sustainable Development (BCSD) Malaysia
> Green Growth Asia Foundation
> Malaysian Recycling Alliance (MAREA)
> Malaysia Green Building Council
> Malaysian Green Tech and Climate Change Centre
> Malaysian Institute of Corporate Governance
> Malaysian Institute for Economic Research (MIER)
> Jeffrey Sachs Centre
> Sustainable Development Solutions Network (SDSN)
> Malaysian Investment Development Authority (MIDA)
> Malaysian Research Accelerator for Technology and Innovation (MRANTI).
Stay tuned this August for more on the ESG PIA 2023.
The ESG Positive Impact Awards 2023 is organised by SMG and endorsed by the Natural Resources and Environmental Sustainability (NRES) ministry with OCBC Bank as the main sponsor.
For more information on ESG PIA, visit https://staresgawards.com.my/.
EARLIER on June 11, the third edition of the Science-Based Targets initiative (SBTi) and Climate Symposium, themed “From Climate Pledges to Action,” hosted discussions on strategies to accelerate corporate climate action.
The event drew over 300 policymakers, sustainability experts and business leaders to Connexion Bangsar South, fostering a dynamic environment for impactful discussions and collaboration.
Organised by the UN Global Compact Network Malaysia & Brunei (UNGCMYB), the symposium featured a high-profile interview with Natural Resources and Environmental Sustainability (NRES) Minister Nik Nazmi Nik Ahmad, a speech by UN Resident Coordinator in Malaysia, Brunei Darussalam and Singapore Karima El Korri, with presentations by Bank Negara, UN Development Programme (UNDP), global research institute CIAGR and Alliance Bank.
Whole-of-nation approachThe programme was inaugurated by Nik Nazmi, United Nations Framework Convention on Climate Change (UNFCCC) regional lead Julie Amoroso-Garbin and UNGCMYB executive director Faroze Nadar.
In his remarks, Nik Nazmi emphasised the critical importance of multi-stakeholder collaboration in accelerating climate action and unveiled details of the upcoming climate change bill.
“This new bill will establish a comprehensive framework to ensure that Malaysia not only meets but exceeds its climate targets. By fostering greater accountability and transparency, we aim to drive transformative change across all sectors of our economy,” he said.
The symposium also marked the launch of “Forward Faster-Climate Action’’, a UN Global Compact initiative aimed at boosting corporate accountability and transparency in climate actions.
15 Malaysian companies committed to this initiative, publicly declaring their sustainability goals and the actions planned to achieve these targets.
“We are excited to bring Malaysian companies to the global stage of corporate climate action through ‘Forward Faster’. It is encouraging to see an increasing number of companies commit to science-based emissions reduction targets, which are necessary to meet the goals of the Paris Agreement,” said Nadar.
“Other companies have committed to a just transition, which is imperative especially in countries like Malaysia, where we must look at climate action and inclusive development. We urge all companies to set ambitious climate commitments, and UNGCMYB is here to support their journey,” he stated.
Exchanging expertise
The panel discussion titled “From Commitment to Action” featured insights from notable panellists such as CelcomDigi sustainability head Philip Ling Oon Hun, Bursa Malaysia sustainability management head Ikram Rafie, Sarawak Energy sustainability general manager Mohamad Irwan Aman, whose respective organisations have all committed to the science-based targets initiative (SBTi).
Climate strategies and decarbonising operations were also highlighted by Malakoff Corporation Berhad sustainability, research and investor relations head Saravanan Desigamanie.
In a separate presentation session by nonprofit research and innovation institution WorldFish agriculture and food security, sustainable aquatic food systems unit senior scientist Nhuong Tran, explained how global food systems face numerous challenges, including escalating greenhouse gas (GHG) emissions, soil degradation, water scarcity, biodiversity loss and overfishing.
“Addressing these issues is crucial as food systems contribute up to 37% of global GHG emissions and are responsible for significant environmental impacts,” he noted.
“Aquatic foods, including fish and seafood, play a vital role in nourishing the world’s population. Approximately 800 million people depend on small-scale fisheries and aquaculture for their livelihoods.”
By 2030, the volume of aquatic food production is projected to reach 204 million tonnes.
“Currently, around 3.3 billion people derive 20% of their animal protein from aquatic foods. Additionally, the primary and secondary sectors of fisheries and aquaculture employ a significant workforce, with women comprising half of the workforce,” he added.
Aquatic foods possess several characteristics that make them essential for food security, especially for countries that consume seafood regularly like Malaysia.
“They are a rich source of nutrients and play a critical role in cognitive development, particularly in the first 1000 days of a child’s life. However, despite their importance, aquatic foods are often excluded or siloed in food system policies. This highlights the need for effective governance to ensure their integration into broader food system decision-making processes,” he emphasised.
Rising temperatures, ocean acidification and extreme weather events disrupt aquatic ecosystems, leading to reduced fish stocks and altered species distribution.
Essentially, climate change poses a significant threat to aquatic foods and the communities relying on them. These climate-induced impacts exacerbate the challenges faced by small-scale actors and vulnerable communities, further underscoring the urgency for action.
Measuring climate maturity
In a significant move towards a just transition, the symposium also saw the launch of PROGRESS–a pioneering climate maturity assessment tool that supports SME suppliers to transition.
Developed by UNGCMYB in collaboration with Alliance Bank, PROGRESS helps corporates assess their suppliers’ climate performance through the tool and users can get access to a climate transition action plan and green financing solutions provided by Alliance Bank.
The assessment measures climate performance across three dimensions: climate governance, GHG emissions and business integration.
The questions are simplified to a ‘yes or no’ format and it is optional to key in qualitative data on a company’s carbon footprint.
Corporates such as EcoWorld Malaysia and Sarawak Energy were among the first participants of the PROGRESS programme.
“Enabling businesses to adopt ESG practices forms a core part of Alliance Bank’s sustainability purpose. We have strong, long-standing relationships with the SME community and have focused our efforts in delivering relevant, simple and personalised solutions to help our customers achieve their business potential,” said Alliance Bank Group chief strategy, marketing and business development officer Dr Aaron Sum.
“Our long-term partnership with UNGCMYB includes co-developing the PROGRESS tool, which marks our commitment in helping more businesses transition to more sustainable business models.
He continued: “The bank will continue expanding its supportive ecosystem of financing and beyond banking solutions to continue helping SMEs embed ESG within their business roadmap to build resilience and grow their business.”
IN THE past few years, activity on forest-based carbon offsets in Malaysia has exploded. In early 2023, Bursa launched the Bursa Carbon Exchange to facilitate the trade of voluntary carbon offsets. In early 2024, Sabah launched its first forest-based carbon offset project, the Kuamut Rainforest Conservation Project. Sarawak passed an Environmental Bill which provided a legal framework for the trade of offsets from Sarawak-based offsets, followed by a proposal by controversial logging company Samling to establish another project in Marudi.
Petronas and the Malaysia Forest Fund have reportedly partnered to explore forest carbon sites, and companies including Shell, Grab and Malaysia Airlines have made carbon-neutral claims based on carbon offsets. Most recently, AirAsia has announced that they will implement a ‘sustainability fee’ for carbon offset projects. Further, the government has announced that they are developing a National Carbon Policy to “provide more clarity on carbon trading at the state level”.
The spread of junk offsetsOne trend in the explosion of forest-based offsets in Malaysia is the overreliance on the Verified Carbon Standard (VCS), or Verra, methodologies, which is the basis of offsets marketed by Bursa, the Kuamat project, the proposed Samling project, Malaysia Airlines and Grab alike. The VCS was criticised in 2023 by a joint investigation by Source Material and Zeitgeist, which used data shared by three different scientific studies on the VCS forest methodologies, to find that of the 95 million tonnes of carbon dioxide (CO2) claimed to be offset by Verra, only 5.5 million tonnes, or 6% of the total, constituted actual emissions reductions. This disparity was mostly attributed to an overestimation of how effective the offset projects would be at reducing deforestation. According to the investigation: “while the (Verra) projects claimed to cover forests the size of Italy, they had only protected an area about the size of Venice”, which led to an overestimation of emission savings by an average of 406%.
While VCS had initially rejected the findings of this study, in the months since, the chief executive officer of Verra has stepped down, and VCS confirmed that their existing forest methodologies would be phased out. These findings led to a rise in international scrutiny of carbon offsets, followed by various boycotts, legal cases and regulatory bans, as detailed below.
The international offset boycottIn the wake of this controversy, companies such as EasyJet and Nestle have decided to abandon carbon offsets altogether, while others who continue to claim carbon neutrality through offsets are facing legal action. Notably, in April of this year (2024), the European Union took action against 20 airlines for the misleading use of offsets, including claims that carbon-neutral fees could neutralise passengers’ CO2 emissions. Delta and Evian are among companies being sued by consumers over their use of carbon offsets to claim carbon neutrality; of the over 50 greenwashing litigation cases filed internationally between 2021 and 2022, the majority were premised upon carbon neutral claims which relied on offsets.Various international voluntary standards such as the ISO Net Zero Guidelines, the ISO Climate Change Management Standard, the Revised Oxford Offsetting Principles and Voluntary Carbon Markets Integrity Initiative have excluded the use of offsets from projects claiming to avoid carbon by avoiding deforestation, which means that companies adhering to these standards will be unable to purchase Malaysia-based offsets such as the Kuamut Rainforest Conservation Project and proposed Samling project.
Further, the EU, United Kingdom (UK) and United States (US) have taken measures to restrict the use of claims alleging that a product is carbon neutral due to the use of offsets. The EU’s Greenwashing Directive strictly prohibits such claims. The UK’s Advertising Standards Authority advises against making unqualified carbon neutral assertions, and the Federal Trade Commission in the US has guidelines discouraging deceptive representations regarding carbon offsets.
Down south, Singapore’s Eligibility List For International Carbon Credits Under The Carbon Tax Regime excludes any credits using VCS “Sectoral Scope 14” methodologies, which are their methodologies for forest-based projects, therefore excluding Malaysia-based projects such as the Kuamut Rainforest Conservation Project.
Ramifications for Malaysia
Malaysian authorities and carbon offset operators are pushing for the growth of Malaysia’s forest-based carbon offset market, perhaps indicating an expectation that this will be a significant source of revenue. Further, corporations operating in Malaysia are responding by increasingly adopting carbon neutral claims based on the use of, primarily forest-based, carbon offsets. Notably, operators and corporations alike are proceeding with adopting the controversial VCS methodology.
However, this article aims to caution these actions, and communicate the fact that carbon offsets remain a risky climate and economic strategy as:
> Many forest-based carbon offset projects around the world have failed to deliver their claimed climate benefits; and in some cases, emissions benefits have been overestimated by over 400%.
> In particular, the VCS methodology has been exemplary in producing alleged ‘junk offsets’ and is discredited by various parties, including Singapore.
> There is a strong move in other markets, including the EU and Singapore, to transition away from forest-based carbon offsets.
> Avoided deforestation-based offsets are no longer considered credible by many international voluntary climate standards.
> The use of carbon offsets, particular forest-based offsets, to claim carbon neutrality, has been widely discredited. Jurisdictions including the EU and the UK have ruled that making such claims is illegal under their advertising codes, and companies making such claims are increasingly brought to court. Various companies have responded by binning offsets altogether.
RimbaWatch is a regional, independent watchdog conducting research and analysis on climate-related issues. The views expressed here are the writer’s own.
IN the past 50 years or so, as the has world experienced increased prosperity – especially in developed countries – there has also emerged a parallel culture of largesse and excess i.e. wastage. For the longest time, the top restaurants in the world sourced from all over the globe, getting in caviar from Russia, oysters from France and so on and so forth. Air miles were clocked all over the world and in these restaurant kitchens, only the choicest cuts were utilised.
These days, there has been a renaissance in interest in sustainability in line with the very real exigencies of climate change. A new and growing breed of restaurant owners and chefs are championing sustainability in all its forms, which is something that is desperately needed, given that in the United States alone, restaurants generate up to 34,000kg in food waste in a year.
But sustainability in a restaurant context isn’t just eliminating wastage – i.e. using every part of a vegetable or animal and incorporating these practices throughout the restaurant, it is also about sourcing ingredients from the closest possible source.
Other aspects of sustainability in F&B includes using ethically-sourced sustainable packaging as well as energy-efficient equipment and even limiting water wastage.
It isn’t easy by any stretch of the imagination but some restaurants in Malaysia are putting their best foot forward in the drive to be sustainable.
Pickle DiningAt Pickle Dining, chef-owner Danial Thorlby is hugely driven by the concept of sustainability. Nearly 90% of the vegetables on his European-influenced menu are sourced locally with 10% sourced from Japan. Danial is so committed to reducing his carbon footprint that he says in the future, he may remove these Japanese vegetables from his menu entirely.In terms of utilising every part of an ingredient – he says this is a concept that appeals to him and he routinely tries to use an entire ingredient – whether that means roasting onion skins or cooking heads of chives or smoking fish bones to turn into broths or fish stock.Perhaps one of the most useful methods Danial has employed at his restaurant is preservation techniques like fermentation and pickling, which typically extend the shelf life of different ingredients.
At his restaurant, recycled glass bottles are packed with pickled or fermented ingredients from carrots to beetroots, and he incorporates all sorts of preservation techniques from all over the world, utilising primitive methods that were once prevalent in the era before refrigeration existed.
In the future – and in order to incorporate a more holistic ground-up approach to sustainability – Danial is hoping to introduce a smart system at the restaurant that will ensure the efficient use of equipment like air-conditioners at his restaurant.Caffe SproutsFarm-to-table has become a buzzword in the F&B industry in the past few years, but few restaurants epitomise this quite as much as KL’s Caffe Sprouts.The eatery is one of the few restaurants in the Klang Valley whose partners are actually farmers based in Cameron Highlands and Shah Alam, Selangor.
The eatery led by seasoned chef Shawn Koh – has a very strong focus on vegetables, which are brought in directly from the partner farms that Koh works with. While the Cameron Highlands’ farm produces highland vegetables like momotaro tomatoes and courgettes, the Shah Alam farm makes use of lowland veggies like bak choy and spinach grown hydrophonically, a farming process that uses 90% less water than conventional farming.
Popular vegetable-focused dishes on the menu include the charred nai pak and grilled cabbage, among a host of others.
Koh also works with the farmers to help him grow specific breeds of vegetables, depending on his restaurant’s needs and requirements.
The restaurant recently announced that it would be moving to a new location at the end of July 2024, so exciting things are ahead for sure.Ember KLAt Ember KL, chef-owner Gary Anwar espouses a very valid point: chefs are incredibly privileged to be able to play with food every day, which is why they must do this mindfully and with a view to avoiding wastage.Which is why Gary takes this very seriously. At Ember, he reverse engineers his thought process for every dish, which means a dish’s conception will involve contemplation of the waste that is involved.
So, for example, if he is making meringue for dessert, he will obviously have a lot of extra egg yolks on hand, but he will not introduce the dish until he figures out how to make use of the ‘eggs-tra’ yolks. Gary also looks at making use of what he has on hand. The restaurant features duck quite a bit on its menu, which is why he started turning the duck fat into oil and using it in his cooking.
These days, he says he has stopped buying vegetable oil and mostly uses duck fat or beef fat as his cooking oil.
Trimmings are also utilised. The steak that is on the menu for instance features premium cuts while the trimmings and cast-offs are used to make a beef tartare dish. While the restaurant started out with Japanese leanings, Gary has gotten very serious about sourcing locally and now says that if he cannot create a dish with only local produce, he doesn’t – with the only exceptions being beef and butter, which have to be imported.
Otherwise everything on his menu absolutely has to be locally sourced, or he simply won’t serve it.A Little Farm on the HillWhat started out as a little six-acre organic farm in Pahang’s Janda Baik has now evolved into a thriving operation that supplies vegetables to supermarkets and top restaurants throughout the Klang Valley.The brainchild of architect Lisa Ngan and her husband Pete Teo, the farm grows a range of vegetables like pumpkin, peppers as well as fruits and herbs.
The farm also hosts weekend lunches and this is where you get to experience a farm-to-table meal in its truest sense, indulging in meals like roasted pumpkin, sweet peppers turned into dips and so on.
This is likely the most authentic farm-to-table experience out there, simply because you have a bird’s eye view of the farm and the produce you are tucking into, and this breeds an intrinsic sense of connection to the food you are eating.Ignis KLA restaurant that specialises in charcoal grilling with a Malaysian touch, Ignis KL makes a conscious effort to source its produce as sustainably as possible, including sourcing all of its garnishes and micro-herbs from sister restaurant The Farm Foodcraft’s urban garden (both restaurants are under the same ownership and share their fresh produce).The restaurant’s owners also have a stake in a farm in Bentong and while the farm currently only provides a few vegetables and fruits that go to the restaurant, there is a possibility that production will be expanded to supplement what the restaurant needs.
In addition, all the vegetables at the eatery are 100% local as is the seafood, like Sabah slipper lobster.
Executive chef Lroy Lim is also mindful of wastage and uses vegetable trimmings to flavour stocks and broths in a bid to limit wastage and encourage a culture of utilising every bit of an ingredient to its fullest.
SOUTH-EAST Asia has had a rich tradition of enjoying alternative proteins, long before the term itself became trendy.
Tempeh, a fermented soybean cake, is one dish that exemplifies this. Tempeh has been a staple in South-East Asia for centuries, including Malaysia, where it’s a key ingredient in stir-fries, soups and even snacks.
Not only that but soybeans, lentils and other legumes have also been a staple of Malaysian cuisine for their affordability and nutritional value. Tofu, another soy product, is another popular protein alternative, starring in many curries, soups and desserts. Beyond soy, jackfruit, a tropical fruit with a meaty texture, has found its place as a meat substitute in curries and stews for generations too.
Tempeh and tofu are derived directly from soybeans through minimal processing – fermentation for tempeh and curdling for tofu, while jackfruit simply uses the whole fruit.
However, traditional alternative proteins like tempeh, tofu and jackfruit differ significantly from their latest counterparts in terms of origin, processing and how they mimic meat.
Why mycoprotein specifically?
Alternatives such as mycoprotein is made from fusarium venenatum - it comes from a specific part of the fungus that requires precise biofermentation technology to isolate and cultivate the protein.
Interestingly, mycoprotein is often made to resemble specific meat textures like ground beef or pulled chicken, making it a vegan-friendly substitute for familiar dishes. The first of these was a meat substitute in pot pies back in the 1980s by United Kingdom-based company Marlow Foods, under the brand name Quorn.
Locally, one family business started out in 1998 to develop plant-based meats for its consumers - that same company is known today as Ultimeat.
Ultimeat chief executive officer and founder Edwin Lee believes that mycoprotein—as an alternative— offers a unique combination of nutritional benefits, sustainability advantages and culinary versatility, making it a standout option among the growing array of meat substitutes available in the market today.
“Its ability to mimic meat’s texture and nutritional profile without the environmental footprint or health concerns associated with some animal-derived products positions it as a promising alternative in the shift towards more sustainable and plant-based diets,” he said.
“It’s high in quality protein, containing all nine essential amino acids, making it a valuable protein source for vegetarians and vegans.
“It’s also low in total and saturated fat, providing a heart-healthy alternative to many animal-based proteins. Mycoprotein is also high in dietary fibre, which is beneficial for digestive health,” Lee said, adding that it is also a source of essential vitamins and minerals such as zinc, selenium, phosphorus and B vitamins.
The high protein and fibre content of mycoprotein also contribute to enhanced satiety and fullness, which can help reduce one’s overall calorie intake.
These combined nutritional benefits make mycoprotein a highly beneficial component of a balanced diet, supporting both individual health and sustainability.
Reduced environmental impact
Mycoprotein production offers a lower environmental impact compared to traditional livestock farming.
It emits significantly fewer greenhouse gases (GHGs), producing about 90% less carbon dioxide (CO2) than beef production.
According to Lee, their mycoprotein fermentation process produces meat-like proteins in just seven days.
This also translates to mycoprotein requiring less land, which reduces deforestation and habitat destruction. The process also uses substantially less water, helping to conserve freshwater resources, which are under increasing pressure from population growth and climate change.
The long-term production of mycoprotein is also more energy-efficient than raising livestock, resulting in a lower overall carbon footprint.
Breaking into the local scene
Earlier in April, Ultimeat partnered with Nimbus Restaurant to launch an exclusive, limited-time menu featuring Ultimeat Mycoprotein. It ran from April 15 to May 15 with a menu that showcases the versatility and culinary potential of mycoprotein to mark its debut in Malaysia.
Nimbus Restaurant chef-owner Fred Choong found that partnering with Ultimeat to feature mycoprotein on Restaurant Nimbus’ menu was a “fantastic opportunity to innovate and cater to health-conscious and environmentally aware diners.”
“This partnership can inspire others to explore new culinary horizons and make a positive impact on our planet. I’m excited to take on new challenges and explore innovative ways to create delicious meals,” Choong added.
The exclusive menu showcased an indulgent spread of dishes that feature mycoprotein as the star ingredient.
This included the king oyster mushroom with a Thai twist of a tom kha emulsion; the smoked mycoprotein risotto, with briny capers and sundried tomatoes; and also a decadent hazelnut and chocolate dessert which makes use of both a delicate mycoprotein tuile and crispy mycoprotein chocolate feuilletine.
“The [mycoprotein] dishes at Restaurant Nimbus have been enthusiastically received by our customers, who appreciate the delicious flavours and innovative use of sustainable ingredients during our month-long collaboration,” Choong told StarESG.
“Many have embraced mycoprotein not only for its taste but also for its health benefits and eco-friendly profile. It’s inspiring to see our patrons enjoying these new offerings and supporting our commitment to culinary creativity and sustainability.”
Both Lee and Choong hold the view that it is extremely important for businesses in the food industry to adapt and offer sustainable options to address both environmental concerns and consumer demands.
“As environmental issues such as climate change, resource depletion, and pollution become more urgent, consumers are increasingly looking for products that minimise their environmental footprint. Offering sustainable options not only helps mitigate these environmental impacts but also meets consumer expectations, enhances brand reputation, and can lead to increased customer loyalty and profitability in the long term,” Lee stated.
He also stated how Ultimeat has many more products in the works.
“Our upcoming products, including protein powders, ready-to-drink protein beverages, snacks, and convenience foods, aim to effectively meet these needs.”
IN 2022, World Retail Congress and Boston Consulting Group published a report titled Sustainability In Retail Is Possible But There’s Work To Be Done where it stated that the retail sector is responsible for 25% of global carbon emissions.
The majority, around 98%, of these emissions occur throughout the retail value chain, placing retailers as the last line of defence before consumers take responsibility for a product’s end-of-life cycle.
While retailers have limited direct influence on carbon emissions, they can still make a significant difference in promoting sustainability.
An imperative for brands
The retail industry is undergoing significant transformations due to key macro trends. Research conducted by research analyst firm IHL Group from 2023 titled, New Forecast Reveals Groundbreaking Potential of Generative AI in the Retail Industry: $9.2 Trillion Impact Expected by 2029 predicts that generative artificial intelligence (AI) will have a profound impact of US$9.2 trillion on the retail sector by 2029.
AI is revolutionising operations by improving efficiency and traceability, which is especially valuable in times of economic uncertainty and the need for resilient supply chains. This technological shift coincides with the preferences of younger generations, who possess increasing purchasing power and prioritise supporting sustainable brands even in challenging economic conditions, as highlighted in a study by Amazon Ads called Higher Impact.
Moreover, the retail industry is facing stricter regulations such as the European Union (EU) Corporate Sustainability Reporting Directive and the Green Claims Act. These regulations not only impact retailers in the EU but also set a new standard for transparency and responsibility globally.
These same trends are driving the retail sector towards a more sustainable and adaptable future, resulting in ongoing opportunities for innovation and improvement throughout the entire value chain.
Younger consumers and their choices
Consumers, particularly Generation Z and millennials, demonstrate a strong commitment to sustainability, as evidenced by a separate survey conducted by McKinsey & Co titled The State of Fashion 2020. The survey revealed that two-thirds of respondents and three out of four millennials consider sustainability when making purchasing decisions.
At the same time, a report from global market intelligence agency Mintel also revealed that 60% of consumers believe that companies fabricate their green claims, indicating a lack of trust in the ‘green’ claims made by large corporations.
Flying Fish Lab co-founder and managing partner Mário Braz de Matos, in his 30 years of experience with consumer goods, has found that growing consumer awareness has caused this shift in behaviour.
“Given that awareness, consumers want to make the right choice. So they look for labels, names, logos, symbols or even claims to try to confirm that they are making the right choice [with their purchases].
“Companies are responding to this consumer demand by including green labels. However, what you see happening now is that this space is currently not well-regulated so you see brands take different strategies to tell consumers about the benefits of their products,” he said, adding that competitive pressure sees brands get creative with their marketing.
You might have seen some of these labels such as ‘biodegradable’, ‘organic’ or even ‘free-roaming’. But, you may be less familiar with terms like ‘carbon neutral’ and ‘net-zero carbon emissions’ in definition.
“Because consumers lack the necessary info on these labels, despite their good intentions, they can end up making a decision and only find out later on that a particular product isn’t as green as it claims to be,” he noted.
Consumers are becoming more sceptical of businesses’ claims regarding sustainability practices, and this becomes a hurdle when ‘green’ products come with a higher price tag as consumers become unwilling to make the ‘greener’ purchase.
This phenomenon is referred to as ‘green fatigue’, and it poses a concerning challenge for brands that are already grappling with stricter environmental, social and governance (ESG) regulations.
“Consumers say they are willing to pay more but the challenge with that is the actual behaviour of consumers doesn’t reflect this,” he added, saying that it still comes down to external factors like budget constraints when consumers are faced with this choice.
“In parity, people will want to make the right choice but real life can get in the way,” de Matos said.
Building trust to deter green fatigue
Just as retailers are striving to enhance their sustainability initiatives, consumers are seemingly losing trust and confidence in them. This could be attributed to how people are becoming disillusioned with the current rhetoric and are disheartened by the lack of visible positive outcomes.
“For the average consumer, it’s impossible to examine every single item and verify the credibility of a product’s claims so most people would simplify their choices by choosing to trust certain brands,” de Matos explained.
“That’s where businesses need to honour their trust that consumers have in them because once that trust is broken, it becomes twice as hard to rebuild it - this is also the responsibility of businesses.”
Consumers rely on brands to be knowledgeable authorities on environmental issues and to provide guidance on sustainability matters.
“The best way forward is to cooperate to raise the standards of the playing field and then continue friendly competition within the new playing field,” he noted.
de Matos emphasised that a regulatory framework is needed but that industry players can work together to set standards themselves without the need for formal government intervention in what he described as ‘co-opetition’. He cited how the International Margarine Association of the Countries of Europe (IMACE) representing margarine and vegetable fats producers in the EU voluntarily tightened its Code of Conduct to reduce trans fat levels in foods and fats at retail without the need for government intervention.
He suggested that by collaborating and establishing standardised green labels within their industries, industry players can minimise the occurrence of greenwashing (whether intentionally or otherwise). This presents a significant opportunity for businesses to educate consumers about various sustainability concepts.
Through such education, businesses can not only enhance engagement but also address knowledge gaps, helping alleviate green fatigue for consumers.
HUMANS are remarkably fragile creatures, aren’t we? Mishaps such as a trip and fall, or even changes in temperature - could incapacitate or prove fatal to us. The most recent example is of dedicated pilgrims who lost their lives when they performed the Haj - the annual pilgrimage made by Muslims to Mecca.
All financially and physically-abled Muslims are required to complete the pilgrimage at least once in their lifetime. According to Saudi Arabia, about 1.8 million people took part this year and over 1,300 have died due to the intense heat which reached up to 50 degrees Celsius.
At the time of writing, a total of 18 Malaysians have died at the Holy Land, while nearly a hundred were treated in two Saudi Arabian Hospitals. Minister in the Prime Minister’s Department (Religious Affairs) Datuk Mohd Na’im Mokhtar said these cases involved respiratory problems such as lung infections due to the hot and dry weather.
Based on research findings, heat-related mortality for people over 65 years of age increased by approximately 85% between 2000 to 2004 and 2017 to 2021. Between 2000 to 2019 studies show approximately 489,000 heat-related deaths occur each year, with 45% of these in Asia and 36% in Europe.
The World Health Organisation (WHO) has stated heatwaves are among the most dangerous of natural hazards, but rarely receive adequate attention because their death tolls and destruction are not always immediately obvious.
Noting that heatstroke is a medical emergency with a high-case fatality rate, WHO says the number of people exposed to extreme heat is growing exponentially due to climate change in all world regions. WHO added that heat waves can burden health and emergency services and also increase the strain on food and livelihood security as people lose their crops or livestock due to extreme heat.
A recent report from the World Meteorological Organisation (WMO) reveals that Asia remained the world’s most disaster-hit region from weather, climate and water-related hazards in 2023.
Heatwaves are expected to become 12 times more frequent by 2040 compared with pre-warming levels.
Further casualties
Meanwhile, extreme heat waves can cause birds and mammals to die en masse. There was widespread news coverage in 2015 about a deadly heat wave in India that obliterated 17 million chickens - causing prices of poultry to soar.
More recently, hundreds of howler monkeys were observed falling dead off the trees with heat stroke due to a heat dome - an area of strong high pressure which caused blockage of clouds from forming and caused extensive sunshine and hot temperatures across Mexico and the United States. In Malaysia, the heat also had a large impact on agriculture, causing crop damage and reduced yields.
The Star had earlier reported that Agriculture and Food Security Minister Datuk Seri Mohamad Sabu has urged the Malaysian rice industry to brace for hotter weather next year, noting that the ongoing heatwave has affected rice production, leading to reduced yields.
This year’s paddy yield is expected to be around 62%, with the prolonged hot weather over the past three years adversely affecting production, according to the minister who spoke to the media after a visit to the Smart Large-Scale Padi Field Harvesting programme in Sekinchan earlier in March this year.
The Federation of Vegetable Farmers Association president Lim Ser Kwee said the agriculture sector is looking forward to regular rainfall again as things seem to have gone back to normal.
Noting that vegetable farmers in Johor and Pahang (Cameron Highlands) are among the states that were badly hit during the heat wave, Lim says vegetables are getting “confused” on when is the right time to bear fruit.
“The heat messed with their growth cycles. For example, the long bean would sprout flowers but won’t grow ‘fruit’. Cases like this reduce our production yield, which then affects our earnings that were already low to begin with.
“It’s pretty tough for us (farmers). We are facing hardship upon hardship. This is in addition to the recent diesel subsidy issue, which adds cost to us as well,” he said, adding that Deputy Finance Minister Lim Hui Ying has reached out to involved parties to understand the situation better.
Deputy Chief Minister Datuk Dr Jeffrey Kitingan has also mentioned that the heatwave and drought caused by the El Niño phenomenon have caused serious repercussions on Sabah’s agricultural sector.
The State Minister of Agriculture, Fisheries and Food Industry, in a media statement, had stated that the very low rainfall in January and February reduced agricultural yields and affected land management for farming in Sabah. It stated that the hot weather had caused groundwater to evaporate more quickly - leading to dry soil, low humidity and difficulty for plant roots to penetrate the ground, further affecting food production and food security in Sabah.
Will the scorching heat last?
Fortunately, Malaysians—those in the agriculture sector in particular— would be pleased to be able to expect the weather to return to “El Niño-Southern Oscillation (Enso) neutral” cycle within the year.
Enso neutral means that the weather falls between the warm phase (El Niño) and cool phase (La Niña) - neutral means that the temperatures, winds, convection (rising air) and rainfall across the tropical Pacific are near their long-term averages.
National Antarctica Research Centre’s Prof Datuk Dr Azizan Abu Samah says: “There is no need to worry too much about heat waves as Malaysia’s climate is reverting back to Enso neutral and by end of year to La Niña.”
The climatologist explains that heat waves are made up of two components, whereby global warming is associated with an increase in greenhouse gases, which then contributes to the El Niño phenomenon.“Though El Niño is fading, it will take some time (for the globe) to cool down. A heat wave phenomenon is associated with the presence of clear skies in our region.
“In the early part of 2024, El Niño was still influencing our region with clear skies and we had heat waves cranking up the temperature in continental South-East Asia.
“We can expect risks of heat waves to decrease in early 2025 as we move towards La Niña. However, this would increase risks of major flooding and landslides to our region during the early period of the north-east monsoon.
“In the meantime, Malaysians can also expect the usual south-west monsoon weather this year,” he told StarESG.
Pointing out that the rise of public awareness towards climate change is a positive thing, Prof Azizan says the public need not be overly sensitive when the weather changes as Malaysia has always experienced north-east monsoon, south-west monsoon and inter-monsoon.
“Being oversensitive, some people tend to overreact. Any changes (in weather) could just be nature taking its course.”
Additionally, Prof Azizan has urged Malaysians to be vigilant in checking for updates from the Malaysian Meteorological Department (MetMalaysia). He also cautioned on the annual transboundary haze from Indonesia that is likely to hit Malaysia in August.
THE path to decarbonisation is constrained by harder-to-abate sectors, such as trucking, shipping, and aviation. Transport contributes more than a third of carbon dioxide (CO2) emissions from end-use sectors, according to the International Energy Agency (IEA), and these sectors aren’t reducing emissions at the rate needed to achieve global decarbonisation goals.If “business as usual” continues, emissions in these sectors are projected to rise, or even double. To get on track with climate goals, the transport industry needs a dramatically new energy mix—with biofuels taking up a larger share of the basket. Biofuels can play a pivotal role in decarbonisationBiofuels are derived from biological materials, such as crops and agricultural waste. The process of capturing CO2 from biofuels is more cost-effective than other carbon capture options. And, in liquid form, biofuels can be used in existing engines with minimal modification.
Combined, that makes biofuels a viable energy source for aviation, heavy-duty trucking, and deep-sea shipping—all heavy-hitting emitters that otherwise have only nascent or unproven paths to decarbonisation.
Government policies and climate commitments are both fueling demand. In Europe and the United States, transport companies have been mandated to shift towards renewable energy sources, while tax credits and other incentives are spurring progress. In the private sector, climate commitments in industries from aviation to mining are also driving demand.
All told, global demand for biofuels is expected to grow 3% to 5% per annum through 2050, with sustainable aviation fuel (SAF) and hydrotreated vegetable oil (HVO) projected to see the largest growth.Feedstock is the biggest constraint on supply In 2022, global SAF production was between 300 million and 450 million litres—enough to cover 0.1% to 0.15% of total jet fuel demand. By 2050, the International Air Transport Association estimates that up to 450 billion litres of SAF will be needed to keep up with demand. Even optimistic production scenarios show a sizable supply gap. Without transformative changes to technology and agricultural systems, there will not be enough biofuel supply to meet global demand in 2050. Even mature markets like Europe, Japan and the US are likely to become net importers of feedstock and finished biofuel products.
In South-East Asia, private companies have announced or committed over US$3bil in capital expenditures for SAF and HVO pipeline infrastructure projects in the coming years. They are also exploring cultivation and collection innovations to help unlock supply.South-East Asia’s biofuel opportunityIncreasing the production of first-generation (1G) biofuels faces several uphill battles, including the ethical dilemma of diverting farmland and crops away from the world’s food supply. These 1G fuels are suboptimal for aviation, and they have significantly lower carbon abatement potential compared to second-generation (2G) crops—35% to 50% abatement versus 70% to 90%, respectively. The future of biofuels will include a mix of 1G and 2G fuels, with 2G taking an increasing role. And this is where South-East Asia’s natural advantage unfolds. South-East Asia is the world’s largest producer of SAF and HVO feedstocks, generating about 35% of global supply.
South-East Asia also has the world’s largest feedstock supply for 2G biofuels, such as palm oil mill effluent (POME) and palm fatty acid distillate (PFAD). POME and PFAD are produced with byproducts or wastewater from palm oil production—an industry South-East Asia easily owns.
About 85% of the world’s palm oil supply comes from Indonesia and Malaysia. In addition, Thailand and Vietnam are leading producers of sugarcane, which can be turned into ethanol. The region also has an abundance of used cooking oil (UCO). With better collection methods, South-East Asia could increase its supply of biofuel from UCO. And with the right support, South-East Asia could become a global leader in biodiesel production and exports. South-East Asia could become the top HVO and renewable diesel producer by 2030, and it could claim a leadership position in global SAF production by 2050.
Regulation and competition can encourage biofuel
developmentFew South-East Asian countries have policies to encourage consumption or production, even for the most promising biofuels. Singapore aspires to become the frontrunner and to build a SAF hub, but it lacks formal policies to stimulate the market. In contrast, other governments have used regulation and incentives to encourage demand. In Europe, the Renewable Energy Directive established a minimum threshold for renewable energy consumption—whereby 14% of energy consumed in road and rail transport in Europe must come from renewable energy by 2030. In the US, tax credits were expanded and grants were introduced to drive demand for lower-carbon fuels.
In South-East Asia, private companies are making progress towards biofuels, even without government incentives. Singapore Airlines, Cebu Pacific, and Garuda Indonesia have all trialled SAF in flights. In shipping, Pacific International Lines and PSA Singapore tested a blend of biofuels on the Singapore Qinzhou Shuttle.
Neste, which has a large-scale biorefinery in Singapore, stands out as a regional and global leader in the biofuel market.
In addition to increasing capacity and building up commercial capabilities, it invested heavily in feedstock production (its core business) through partnerships, mergers and acquisitions (M&A), as well as research and development. Through a series of acquisitions and investments, Neste has created a comprehensive, global sourcing platform for biofuels.
Companies that remove bottlenecks along the supply chain will be able to capitalise on the region’s natural advantages and capture outsized returns.
First-mover advantagesThere are winning opportunities for every role in the biofuel value chain. In South-East Asia:Upstream suppliers can leverage their unique access to feedstock to maximise supply. For example, farmers and agriculture companies can find ways to optimise their land yields and crop production. Waste management firms can streamline or consolidate collection.
Midstream producers can build new facilities, partner with refiners that are closer to feedstock sources, or retrofit existing refineries. They need to create reliable and affordable access to feedstock and increase their export capacity.Traders can secure contracts and offtake agreements with suppliers and key customers to steady supply and demand. They can encourage loan origination with financing agreements for farmers, and they can support education and programming to reduce carbon intensity.Downstream users can secure the volume they’ll need in the future through long-term agreements with upstream and midstream players. They can also de-risk by securing multiple sources for biofuels and investing in biofuel development and refineries.
South-East Asia’s feedstock market is severely fragmented, especially when it comes to collection. To bring winning strategies to life, organisations across the entire value chain need to consider partnerships. Companies may need joint ventures, partnerships, or M&A to access feedstock, secure offtake strategies, innovate and gain scale.
Retrofitting refinery assets can kick-start productionRefineries in South-East Asia are likely to face utilisation pressure as demand for conventional oil slows after 2030. Given the gaps in global biofuel supply versus demand, retrofitting current assets seems like a target opportunity when technology and regulations allow for it. Conversion can also be more cost-effective for producers than establishing greenfield biofuel plants.
To make the conversion, refineries need to consider four key elements: compatibility, compliance, feedstock supply and the business case.Compatibility: Refiners need to determine what infrastructure modifications are necessary, keeping in mind that each conversion process requires different feedstock, equipment and operational conditions. Distribution infrastructure, such as storage and transportation, should be evaluated as well.
Compliance: Biofuel production is held to different regulatory standards than traditional fuel production, and criteria may vary by region. For example, Europe has a minimum greenhouse gas emission-savings threshold, caps on crop-based biofuels and restrictions on the types of land that can be used for feedstock production.
Feedstock supply: Refiners need easy access to feedstock materials, plus space, logistics and infrastructure for storage. Supply is one area where refiners may need to lean on partnerships or long-term offtake agreements to ensure retrofitting plans are viable.
The business case: Demand for biofuels is likely to grow substantially, but that doesn’t mean the opportunity is risk-free. Refiners need to carefully weigh the risks and the rewards, as well as the environmental impacts of retrofitting. Refiners that operate in South-East Asia can transform themselves into sustainable, future-proof businesses if they meaningfully reduce emissions when they retrofit.
When biofuel demand takes off, refiners can turn stranded assets into growth engines. For the greatest returns, they need to build the right infrastructure, partners and capabilities now. This is the right time to start.
Thomas Luedi is a Bain & Company partner based in Bangkok, Tanguy Morin is partner based in Singapore and Emily Wu is an associate partner based in Jakarta. The views expressed here are the writers’ own.