This article first appeared in The Edge Malaysia Weekly on November 27, 2023 - December 3, 2023

Datuk Lee Yeow Chor, group managing director and CEO of IOI Corp Bhd, attributes the company’s gold award in The Edge Malaysia ESG Awards 2023’s plantation category to the team’s dedication and early start on the ESG journey.

For instance, IOI Corp became one of the founding members of the Roundtable on Sustainable Palm Oil (RSPO), an international multi-stakeholder organisation that focuses on developing and implementing global standards for sustainable palm oil, 17 years ago.

“I believe it is the strong conviction and sense of responsibility of everyone in IOI, coupled with the consistent implementation of our ESG activities, while engaging with our stakeholders to know and meet their growing expectations in the area of ESG, that contributed to our win,” says Lee.

As part of its sustainability efforts, the firm aims to be at the forefront of producing and sourcing sustainable palm oil.

However, Lee observes that with a diverse workforce of over 28,000 employees operating in a geographical area that is thrice the size of Singapore, implementing and ensuring consistent monitoring of ESG activities is a challenge.

To ensure that ESG is properly integrated, the company has introduced a comprehensive group-wide portal system. The IOI ESG portal was established to guarantee the consistent recording and centralised monitoring of all ESG-related metrics, such as greenhouse gas (GHG) emissions throughout IOI’s operations.

Additionally, the company continuously engages its employees on the ground so that any problems faced are addressed and resolved together.

“We are very methodical and systematic in our approach to sustainability. For example, when we first embarked on our journey to reduce our GHG emissions in 2019 through the introduction of our Climate Change Action initiative (CCAi), we identified the source of the emission and then benchmarked it to accurately look at ways to reduce or remove the emission,” says Lee.

The CCAi is one of IOI’s long-term action plans to mitigate and reduce GHG emissions from its operations.

The company aims to reach net zero by 2040 as a group by enhancing existing carbon reduction initiatives through operational efficiency and utilisation of renewable energy.

“Our ESG strategies encompass circularity principles, the adoption of cutting-edge green technologies, and a drive for innovation in optimising resource utilisation, reducing GHG emissions, as well as enhancing energy efficiency,” notes Lee.

The CCAi is reported in alignment with the recommendations of the Task Force on Climate-related Financial Disclosures around four thematic areas, namely governance, strategy, metrics and targets, and risk management. It is also aligned to the International Sustainability Standards Board climate disclosures.

“In addition, when developing our ESG strategies, we look for areas that are of concern to our stakeholders, both internal and external, which enables us to develop effective solutions. I believe these set us apart from others in our industry,” he adds.

Moreover, IOI in the past year has strengthened its biodiversity and ecosystem guidelines on nature-based solutions targeted at approximately 6,000ha of conservation areas in and surrounding its plantations.

“Recently, we also commissioned a palm wood factory in Segamat, Johor, to commercially produce engineered wood panels from oil palm trunks (OPTs) felled during replanting. The idea of repurposing the OPTs is to replace tropical wood while locking in GHG, which would otherwise be released into the atmosphere, from the OPTs,” says Lee.

Earlier this year, Lee unveiled IOI’s commitment to the Science Based Targets Initiative in the forest, land and agriculture category. Under this initiative, IOI shows its dedication to zero deforestation and developing verifiable science-based emission reduction targets.

Lee also expresses contentment with the support and active participation of the Malaysian government, market regulators and institutional investors in the integration of ESG practices for public-listed companies. “However, we urge foreign regulatory bodies such as the European Commission and US Customs and Border Protection to implement their import regulations equitably and based on facts rather than presumptions or outdated data.”

Save by subscribing to us for your print and/or digital copy.

P/S: The Edge is also available on Apple's App Store and Android's Google Play.