KUALA LUMPUR (Oct 23): Natural Resources, Environment and Climate Change Minister Nik Nazmi Nik Ahmad urged companies and financial institutions to participate in voluntary carbon markets (VCM) as a means to offset their carbon emissions and fulfill their voluntary climate objectives.

“I urge all companies and financial institutions to consider participating in VCM as it allows them to offset their carbon emission footprint and meet their voluntary climate goals,” he said when delivering his speech at the Joint Committee on Climate Change (JC3) Conference “Journey to Zero” on Monday.

Despite Malaysia's contribution to global GHG emissions being less than 0.8%, the nation is dedicated to fulfilling its climate commitments. The minister highlighted that Malaysia has initiated efforts to establish VCM to provide financial support for projects and solutions aimed at reducing, removing or preventing GHG emissions.

Earlier this month, Bursa Malaysia launched a VCM handbook to guide local professionals and stakeholders in generating carbon markets that adhere to international standards recognised by the Bursa Carbon Exchange (BCX). Its chief executive officer Datuk Muhamad Umar Swift was quoted as saying that the handbook is designed to assist entities keen on participating in carbon market project development and Malaysia’s voluntary carbon market.

BCX, which was launched by Bursa last year as a voluntary carbon market exchange for buyers and suppliers to transact high-quality carbon credits at transparent prices, has seen 150,000 Verra-carbon credits purchased, with around RM7.7 million in carbon credits sold, said Nik Nazmi.

As a participant in the Paris Agreement, Malaysia is committed to reducing its greenhouse gas (GHG) emissions across its economy by 45% (based on gross domestic product) in 2023 compared to 2005 levels, in accordance with its Nationally Determined Contributions (NDC).

Nik Nazmi also mentioned that the recent mid-term review of the 12th Malaysia Plan indicated significant progress towards two key targets. These include achieving a 24.3% installation of renewable energy (RE) capacity in 2022, with a goal of reaching 31% by 2025, as well as achieving a 33.2% recycling rate for household waste in 2022, with a target of 40% by 2025.