Corporate sustainability practices among Malaysian REITs and property listed companies
| Published date | 07 April 2015 |
| Date | 07 April 2015 |
| DOI | https://doi.org/10.1108/WJSTSD-02-2015-0008 |
| Pages | 100-118 |
| Author | Muhammad Zahid,Zulkipli Ghazali |
| Subject Matter | Public policy & environmental management,Environmental technology & innovation |
Corporate sustainability
practices among Malaysian
REITs and property listed
companies
Muhammad Zahid and Zulkipli Ghazali
Department of Management and Humanities, Universiti Teknologi Petronas,
Tronoh, Malaysia
Abstract
Purpose –The purpose of this paper is to examine the implementation of corporate sustainability (CS)
practice by Malaysian Real Estate Investment Trusts (REITs) and property listed companies,
following the three dimensional (economic, environmental, and social) framework of CS.
Design/methodology/approach –A quantitative content analysis procedure was undertaken using
113 reports, including 23 REITs and 90 property companies. For the data collection company websites,
annual reports, corporate social responsibility (CSR), and sustainability reports were employed.
The global reporting initiative (GRI), reporting framework was used for data collection and recording.
The content analysis examined the level of disclosures for three dimensions of sustainability, namely
economic, social and environmental.
Findings –The content analysis indicates that the majority of companies among the sample have
their social responsibility and sustainability strategies for the satisfaction of stakeholders and legitimizing
firm practices. However, there are variations in their approaches and reporting processes. Among the three
dimensions, environmental disclosures are on its least and social dimension has priority in the level of
disclosures. Though the overallreporting is low, but having upward trends over time.
Research limitations/implications –This study has a limitation that it investigates the level of CS
practices in REITs and property companies among Malaysian listed companies. The findings of the
study are helpful for the government of Malaysia, practitioners, academia, researchers, banks, Bursa
Malaysia, security commission and CEO’s of the listed companies to improve their organizational
practices and reporting quality of CS.
Originality/value –There has been limited literature on CS practices among Malaysian REITs and
property industry. The previous studies have only focused top companies or a single dimension of CS,
while this study addressing all the three dimensions of sustainability. This is the first study addressing
all the three dimensions (economic, environmental, and social) of CS after the 10th Malaysian Plan
(2010-2015). The study using a large sample of REITs and property companies during 2011-2013.
The study will significantly add value to CS practices in emerging economies like Malaysia.
Keywords Sustainability, Sustainable development, Sustainable environment
Paper type Research paper
Introduction
Sustainable development (SD) is an ethical concept related to fight against poverty,
social cause and protect the environment at the same time on macro level (Baumgartner
and Ebner, 2010). The World Commission on Environment and Development (WCED)
described SD as “a process of change in which the exploitation of resources, the
direction of investments, the orientation of technological development, and institutional
World Journal of Science,
Technology and Sustainable
Development
Vol. 12 No. 2, 2015
pp. 100-118
©Emerald Group Publishing Limited
2042-5945
DOI 10.1108/WJSTSD-02-2015-0008
Received 21 February 2015
Revised 21 February 2015
Accepted 6 March 2015
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/2042-5945.htm
This study is funded by the MyRA grant of the Ministry of Education (MOE) Malaysia through
Universiti Teknologi PETRONAS. We would also like to acknowledge the internal reviewers for
their valuable suggestions and recommendation.
100
WJSTSD
12,2
change are all in harmony and enhance both current and future potential to meet
human needs and aspirations”(WCED, 1987). SD has a normative thought of outlining
development paths of societies, which has received much attention in the management
and organizational literature as well. Similarly, firms play a key role in SD as firms are
the productive sources of economy (Bansal, 2005; Baumgartner and Ebner, 2010).
Moreover, SD is now a broad multi-focal agenda, and terms such as “triple bottom line ”
(TBL), “corporate social responsibility”(CSR), “SD”and sustainability are being used
interchangeably (Elkington, 2004; Marrewijk, 2003). Sustainability incorporated in
firms known as corporate sustainability (CS), which comprises the dimensions of
economic, environmental and social (Baumgartner and Ebner, 2010).
CS is also in its growth and importance worldwide and has come to be considered as
a challenge in economic and managerial debates (Sebastiani et al., 2014). However, there
is no universal definition of CS (Roca and Searcy, 2011). CS defined as “the ability of
a firm to meet the needs of its direct and indirect stakeholders without compromising
its capability to satisfy their needs in the future”(Dyllick and Hockerts, 2002). Another
definition described CS as “demonstrating the inclusion of social and environmental
concerns in business operations and in interactions with stakeholders”(Marrewijk, 2003).
Besides, in business perspectives sustainability means “business strategies that meet
the needs of the enterprise today and its stakeholders while sustaining the resources,
both human and natural, which will be needed in the future”(KPMG, 2011). Merely,
focus on sustainability practices in corporations it revealed that its interrelationship
between society, environment, and economic development (WCED, 1987). As a result, it is
gradually emerging that companies are focusing on sustainability practices in order to
gain prestige and privileges among the stakeholders not simply relying on economic and
financial performances. Similarly, the stakeholders are also interested to find the flavor
and integration of environmental and social blends among the strategies and vision of an
organization. Hence, to move towards sustainability, business organization are required to
look at all-around from a holistic perspective in order to satiate the demand of multiple
stakeholders by addressing economic growth, environmental and social sustainability
(Setthasakko, 2007). The authors state that CS is closely related to (CSR (Roca and Searcy,
2011). However, now a days many authors (Bansal, 2014; Marrewijk, 2003) prominent
practitioners and global reports (KPMG, 2013; PwC Malaysia, 2013; UNGC, 2013)
considered CS and CSR as synonyms, moreover, “they have converged to very similar
concepts in recent years”(Steurer et al., 2005). This study is also using CS and CSR as
synonyms. CS also includes the concept of “TBL”which has proposed the need for
a balance in the three dimensions, economic, environmental, and social in order to achieve
sustainability within organization (Goyal et al., 2013). The three dimensions of CS can be
explained as follows.
Environmental/ecological sustainability
The environmental dimension of CS deals with the impacts on the environment due to
corporate activities. This dimension also named as an ecological dimension of CS.
It can be defined as “the environmental dimension of sustainability concerns the
organization’s impact on living and non-living natural systems, including land, air,
water and ecosystems”(GRI, 2013). Environmental dimension covers the impacts
related to inputs, i.e. energy and water use, outputs such as emissions, effluents and
waste etc. It also covers biodiversity, transport, product and service related impacts ,
environmental compliance and expenditures of a company (Baumgartner and Ebner,
2010). Goodland (1995) defined environmental sustainability as “seeks to improve
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Corporate
sustainability
practices
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