Over view of CSR in Malaysia

Mira Janani.V
Research Scholar,
School of Management Studies,
Vels Institute of Science of Technology & Advanced Studies,
Chennai
Dr. Gayathri.S
Associate professor,
School of Management studies,
Vels Institute of Technology & Advanced studies,
Chennai
ABSTRACT:

Malaysia is ranked among the top ten Asian countries in the world when it comes to CSR. Corporate
social responsibility in Malaysia stems from the basic level of the employees themselves. The CSR in
Malaysia comes under the category of both Philanthropic as well sustainability focused. This paper
looks into the corporate social responsibility in Malaysia and also looks at the top ten companies in
terms of CSR in Malaysia.

Key words: CSR, Corporate Social Responsibility, Malaysia, Philanthropy, Sustainability

INTRODUCTION:

The first definition of CSR was given by Howard Bowen he defines CSR as “CSR refers to the obligations
of businessmen to pursue those policies… which are desirable in terms of the objectives and values of
our society” (1). That is, CSR is what the corporates give in return of the resources that they obtain
from the society. In Malaysia, there are two institutions that have defined CSR. The ACCA Malaysia
defines CSR as “The company’s obligation to all its activities with the aim of achieving sustainable
development in the economic, social and environmental dimensions. The stake holders of a company
include the employees, customers, suppliers, community organisations, environment, subsidiaries,
affiliates, local neighbourhoods, planet, investors and shareholders.” (2)

And Bursa Malaysia the Malaysian stock exchange defines CSR as “Corporate social responsibility
(“CSR”) is a concept that focuses on a corporation’s behaviour and actions. CSR has been defined as
open and transparent business practices that are based on ethical values and respect for the
community, employees, the environment, shareholders and other stakeholders. In essence, what this
means is corporations integrating socially responsible behaviour into their business operations. For
instance, this can range from making charitable donations or enhancing employee welfare to aligning
or modifying the corporation’s operations to ensure that it is more environmentally friendly. These
are of course very limited examples as there is no singular model on how to approach CSR. Each
corporation, based on the nature of their business and resources may choose to undertake the CSR
activities that are more suitable for them at that point in time.” (3)

So, we see that in Malaysia, even the employees are involved when it comes to the socially responsible
actions rendered by the corporates.

LITERATURE REVIEW:

Lu and Castka (2008) talk about the status of CSR in Malaysia, the different CSR aspects in Malaysia
and the future that can be expected in terms of CSR in Malaysia. The data collected for the purpose
of this study is primary from the interviews conducted from the top experts in the top companies in
Malaysia which was collected from the website search and in the potential consultation with the
chairperson of the national mirror committee on social responsibility. Thirteen such experts were
interviewed. The study concluded that the experts agreed that the CSR in Malaysia was still in its
infancy stage. Regarding the CSR practices in Malaysia, the study concludes that it is mostly based on
philanthropy. And regarding the future diffusion of CSR, the study concludes that it will take some
time for Malaysia to reach the developmental stage in terms of CSR in Malaysia.(4)

Zabid et al., (2002) talk about the attitude of the Malaysian managers and executives towards CSR and
the CSR activities carried out and also the factors that lead the managers to develop this attitude
towards CSR. The data collected in this study was primary based on the structured questionnaire. In
the questionnaire, 14 attitudinal statements on CSR were asked on a five-point interval scale ranging
from strongly disagree to strongly agree. The sampling done was simple random sampling of the
companies in the city of Kuala Lampur in Malaysia. The study concludes that out of the 14 statements
made six had more than 50 percent positive answers. The managers viewed CSR in a positive aspect.
In terms of involvement in CSR activities, 97.5% of the respondents agreed that their companies were
involved in CSR activities. Regarding the determinants of attitude towards CSR, the results indicated
that the family upbringing was the most influential factor. Traditional beliefs and customs were ranked
second. (5)

Ahmad (2016) talks about the CSR communication practices in the social media among the award-
winning companies in Malaysia. The recording of number of likes shares and comments of the
stakeholders on the posts relating to CSR was made. The data has been analysed using thematic
analysis. The data was from June 2015 to June 2016. Of all the posts of the company in these social
media more than 52% were about CSR. The posts concentrated on the achievements made by CSR.
Thus, the study concludes by saying that an award-winning company for social responsibility tends to
be more dominant in the social media regarding its communication of CSR to the stakeholders. (6)

RESEARCH METHODOLOGY:

This paper’s data source is secondary obtained from the websites of the institutions and companies
in Malaysia.

HISTORY OF CSR IN MALAYSIA:

CSR in Malaysia originated in the year of 1974 by the petro chemical industries by providing
philanthropical services to the economically downtrodden people. Even the employees of the
companies in addition to their working hours participated in providing voluntary services. In the year
of 2006, The Malaysian Government in order to promote CSR issued a tax rebate of ceiling of 7% for
the companies who carry out CSR activities. In the year of 2007, Bursa Malaysia the stock exchange of
Malaysia made the reporting of CSR mandatory for Public Limited companies. But there is no fixed
rule as to where the companies should report their CSR.

SYSTEM OF CSR IN MALAYSIA:

This study finds that the CSR in Malaysia is divided under two categories of philanthropy and
sustainability. The top companies do CSR on both of these categories. There are two institutions that
look at CSR in Malaysia the Bursa Malaysia that is the stock exchange in Malaysia that supervises the
CSR of the public limited companies and ACCA Malaysia that supervises the overall CSR in Malaysia.
The corporates are given absolute freedom whilst choosing the activities of CSR and there is no rigid
framework provided for the corporates to concentrate on while carrying out their socially responsible
activities.

TOP TEN COMPANIES IN CSR IN MALAYSIA:

For the purpose of this study, top ten companies in terms of corporate social responsibility were taken.
The list was obtained from the official business magazine in Malaysia titled “Top 10 Malaysia”. In
accordance to the list published in the year 2019, these are the top ten companies in Malaysia when
it comes to CSR. (7)

Sime Darby Berhad:

It is a rubber company based in Malaysia in the year of 1910. Sime Darby has Yayasan Sime
Darby (YSD) a philanthropic organisation established by the company that was established
with the capital of RM 20 million. YSD has 5 focus pillars they are: environment, education,
community, health, sports, arts and culture. (8)
Axiata Group Berhard:
It is Malaysia’s one of the leading telecommunication group and has 290 subscribers across 10
countries. The CSR of Axiata is mostly circled round providing digital training. The company
has signed up with the Youth and Ministry of Education to provide digital training to the
economically downtrodden youth with help of the institutions that the youth study in. Axiata
Malaysia also considers the provision of quality products also to be a part of its CSR. (9)
CIMB:
It is the largest investment bank in Malaysia. It has more than 1080 branches across the world.
CIMB call themselves CSR advocates and spend RM 76 million in giving back to the
community. (10)
Malayan Bank Berhard:
It is fourth largest bank in Malaysia in terms of asset. It is an Islamic bank. It has a foundation
called the Maybank foundation which is an arm that carries out the CSR in the organisation.
Taking a look at the Maybank foundation website, it is seen that the bank is mostly concerned
about the philanthropic work. Operating in the fields of education by providing scholarships to
the economically challenged students, health- by providing subsidised health care to the
economically downtrodden people, promoting arts by providing opportunities to the struggling
artists and photographers. (11)
Allianz Malaysia Berhad:
It is a leading general insurance company in Malaysia. It has established the foundation called
the Allianz4Good which focuses on the pillars of Road safety, Financial literacy, community
and environment. (12)
Calsberg brewery Malaysia Berhad:
It is a renowned manufacturer of beer un Malaysia. The focus areas of the company’s CSR
consist of economic, environment and social. In terms of economic sustainability, the company
takes into account the employment generated and the payment of taxes to the Government and
thus being able to contribute to the economy, a part of its CSR it also considers the local
employment generation to be a part of its CSR. In terms of environment, the company in its
operation reduces the usage of water while making beers. As for the society, the company
encourages responsible consumption of its cigarettes and beers thus teaching the society how
to drink responsibly. (13)
Digi.com Berhad:
It is a telecommunication company in Malaysia. The focus of this company is on educating the
poor, food and clothing for the poor, health and medical care, child welfare, environmental
conservation and women empowerment. Providing awareness among the employees and the
usage of the digital platform for education among the children in their schools are the major
CSR activities of the company. (14)
RHB capital Berhad:
It is the fourth largest integrated group in Malaysia. Taking a look at is sustainability report, it
is seen that as a part of its CSR, the company operates in such a way that there is a reduction
in the energy consumption and water consumption year on year. (15)
Faser and Neave Holdings Berhad:
It is one of the oldest beverages and dairy products company. The company focuses on the
aspect of education providing scholarships to the economically downtrodden children, in terms
of environment by operating sustainably and leading many environmental campaigns. (16)
Petroliam Nasioanl Berhad:
It is an oil and Gas company in Berhad it is also called as Petronas. It has an arm called Yayasan
Patronas that is for providing CSR. The focus areas are education by providing opportunity for
underprivileged children to realise their potential through STEM education, community well-
being by providing subsidized health care for the underprivileged and development and
environment by taking actions to reduce its environmental damage and to operate sustainably.
(17)
CONCLUSION:
Thus, the CSR in Malaysia is mostly philanthropic centred. And as it can be seen from the
study, it is still having a scope of further improvement. As more and more technologies start
coming up and more and more MNCs start pouring in, it can be expected that the CSR in
Malaysia will be improved upon further down the line in the future.
REFERENCES:
Bowen, H. R., & Johnson, F. E. (1953). Social responsibility of the businessman. Harper.

ACCA Malaysia (n.d). Retrieved from https://www.accaglobal.com/uk/en/about-

us/regulation/ethics/corporate-social-responsibility.html
Bursa Malaysia (n.d). Retrieved from
http://customer.bursamalaysia.com:8080/MainLR/Pages/FAQ%209.51.aspx

Lu, J. Y., & Castka, P. (2009). Corporate social responsibility in Malaysia–experts' views and
perspectives. Corporate Social Responsibility and Environmental Management, 16(3), 146-154.

Abdul, Z., & Ibrahim, S. (2002). Executive and management attitudes towards corporate social
responsibility in Malaysia. Corporate Governance: The international journal of business in society.

Ahmad, Z. (2016). Communicating CSR in the digital age: An exploratory study of a CSR award winning
company in Malaysia. Journal of Education and Social Sciences, 4, 1-6.

Top 10 Malaysia (2019). Retrieved from http://top10malaysia.com/main/csrs-shining-stars/

Sime Darby (n.d). Retrieved from http://www.simedarby.com/operating-
responsibly/community
Axiata Group (n.d). Retrieved from https://www.axiata.com/sustainability
CIMB (n.d). Retrieved from https://www.cimbbank.com.my/content/cimbgroup/en/corporate-
responsibility.html
Malayan Bank (n.d). Retrieved from
https://www.csrhub.com/CSR_and_sustainability_information/Malayan-Banking-Bhd
Allianz Malaysia (n.d). Retrieved from https://www.allianz.com.my/allianz4good
Calsberg Brewery Malaysia (n.d). Retrieved from
https://carlsbergmalaysia.com.my/sustainability/sustainability-at-carlsberg/
Digi.com (n.d). Retrieved from https://www.digimediainfotech.com/corporate-social-
responsibility/
RHB capital (n.d). Retrieved from https://www.rhbgroup.com/malaysia/investor-
relations/financial-reports/annual-reports/sustainability-report
Faser and Neave Holdings (n.d). Retrieved from https://www.fn.com.my/sustainability/
Petroliam Nasioanl (n.d). Retrieved from https://www.petronas.com/about-us/yayasan-
petronas