PNB Launches Sustainability Framework Allocates RM10 Billion For Green Transition

Permodalan Nasional Berhad announces its new Sustainability Framework that will define and internalise its goals for a more sustainable future amidst a changing global investment landscape.

The PNB Sustainability Framework was formulated based on several guiding beliefs. The first belief is that by integrating ESG issues more systematically into its investments and operations, it will be better positioned to seize new opportunities. With its size and influence, the government fund manager also has an important role in addressing the systemic challenges facing communities and stakeholders, particularly its unitholders.

Additionally, to ensure a progressive and successful journey to a more sustainable future PNB says it must lead by example to inspire the cooperation of all its stakeholders. This includes, among others, embedding ESG into its operations, building a holistic sustainability culture, and being transparent in what it does. Most importantly, it intends to proactively update its commitments and strategies, acknowledging the need to constantly adapt to the evolving climate and sustainability landscape.

PNB Group Chairman, Tun Arifin Zakaria said during the media briefing, “As one of the country’s largest fund management institutions with approximately 10% invested in domestic companies listed on the local bourse, PNB has a responsibility to navigate the complexities of the ESG journey.

Tun Arifin further elaborated that “In 2021, Malaysia announced in its 12th Malaysia Plan, a goal for the country to become carbon neutral by 2050. We believe Corporate Malaysia has the responsibility to play an important role and must work together towards meeting this goal. For PNB as a corporation, we aim to be a net zero enterprise by 2025 with a net zero portfolio by 2050, working together with our investee companies in support of Malaysia’s carbon-neutral ambition.”

PNB has identified 10 ESG commitments under three pillars. For Environmental-PNB seeks to align its sustainability efforts to support the transition toward a green economy with three commitments. PNB commits to a Net Zero Enterprise by 2025, achieving a Net Zero Portfolio by 2050, and investing RM10 billion in Green and Transition assets
by 2030.

For social, it aims to address issues on equity and inclusion. These include taking a stand in labour rights issues to further strengthen the Stewardship Framework launched in 2020, ensuring all its employees earn above the living wage by 2023, and setting a target of 40% female participation at the senior management level by 2025. Under this pillar, the company also committed to balancing PNB’s profits with social investments to align with its mission of enhancing wealth for Bumiputeras and all Malaysians.

As for Governance, PNB will be strategically more transparent and active in engaging ESG-related and climate change issues. It will advocate sound governance practices by way of establishing a Triple Bottom Line Stewardship Model, to drive greater transparency in voting and to ensure the reporting disclosures are aligned with the Task Force on Climate Related Financial Disclosures.

President & Group Chief Executive, Ahmad Zulqarnain Onn, said “ we will work closely with our investee companies to develop value creation plans that will ensure sustainable growth of their operational and financial performance.

PNB was created by the Government for a socio-economic objective which includes promoting financial inclusion amongst all Malaysians. Over the past 43 years, PNB has delivered on its mandate to provide sustainable returns to its unit holders and has grown to manage more than RM300 billion in assets for them.

With the aim of ensuring a successful implementation of its Sustainability Framework, PNB has established a comprehensive governance structure comprising a dedicated management committee reporting to the Board of Directors. Towards this, PNB created two new functions, namely Investment Stewardship Division and Enterprise Sustainability Department which are
responsible for the overall implementation of the Framework.

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