This article first appeared in The Edge Malaysia Weekly on October 28, 2024 - November 3, 2024

Hextar Retail Bhd (KL:HEXRTL) emerged as the gold winner in the emerging star category at The Edge Malaysia ESG Awards 2024 for acknowledging the need to minimise the company’s environmental impact from conserving energy and reducing its carbon footprint.

Managing director Eric Vo says this was achieved through a combination of energy-efficiency initiatives, transitioning to renewable energy sources and promoting sustainable practices across the company’s operations.

“By engaging key stakeholders and employees, we raised awareness and drove change by investing in solar energy systems and installing energy-efficient LED lighting. These efforts were aligned with our long-term sustainability goals. Energy conservation has emerged as the most notable ESG achievement over the past year for Hextar Retail,” he says.

The emerging star category was introduced at the awards this year to reward public-listed companies that received ESG scores by FTSE Russell for the first time in the past year.

Vo says sustainability is integrated into every facet of the company’s business operations.

“We’ve implemented an inclusive workplace policy [that promotes] diversity and equity across all levels. Additionally, we’re deeply committed to transparency, [with] detailed ESG reports [published yearly] to keep our stakeholders informed. What sets us apart is the seamless alignment of ESG goals with our overall business strategy, ensuring that sustainability is not treated as a side initiative but as a core part of how we create value,” he says.

For Hextar Retail, the biggest challenge over the past year was to stay competitive amid rising operational costs. This is because the shift to sustainable materials and processes requires significant investment, with slow returns on the initial investment.

The company managed to overcome this with the help of tax incentives, government grants, cost-saving measures and strategic partnerships with suppliers that have a shared sustainability vision, he says.

This is why Vo is hoping for stronger support from the government for ESG adoption to be more effective in Malaysia. For instance, this could be in the form of incentives for companies that invest in sustainable practices.

“Current tax breaks and subsidies for renewable energy adoption are particularly helpful. From investors, we hope for a longer-term perspective on ESG investments, recognising that while the initial costs are high, the long-term value to society and the business is significant. Lastly, consumer demand for sustainable products needs to continue growing, as this drives more businesses to integrate ESG into their core strategies,” he says.

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