Bursa Malaysia Berhad (“Bursa Malaysia” or the “Exchange”) and the Malaysia Forest Fund (“MFF”) have formalised a Memorandum of Collaboration (“MoC”) to advance carbon market development and foster synergies in Environmental, Social and Governance (“ESG”) efforts. The MoC was announced today during the 3rd Malaysia Carbon Market Forum, the annual flagship event of Bursa Carbon Exchange (“BCX”).
MFF leads the development and implementation of the REDD Plus Finance Framework (“RFF”), which comprises two instruments — the Forest Conservation Certificate (“FCC”) and the Forest Carbon Offset (“FCO”). The MoC aims to explore synergies between MFF’s programmes and Bursa Malaysia’s efforts to support decarbonisation among companies through avenues such as BCX, a wholly owned subsidiary of Bursa Malaysia.
The MoC exchange between Dato’ Fad’l Mohamed, Chief Executive Officer of Bursa Malaysia, and Suhaini Haron, Senior Director of Corporate Development and Strategy of MFF, was witnessed by YB Datuk Seri Johari Abdul Ghani, Minister of Plantation and Commodities and Acting Minister of Natural Resources and Environmental Sustainability (NRES).
The scope of the two-year collaboration will cover exploration of the following areas:
- Potential inclusion of FCC support into ESG-themed indices, to promote forest conservation efforts by listed entities.
- Promoting awareness of the national carbon crediting programme once it is established.
- Identification of opportunities for FCO units to be traded by both domestic and international participants through BCX, to enhance carbon trading liquidity.
- Establishing potential pathways for synergy in carbon market infrastructure development such as registries and tracking systems, in alignment with national policies and regulatory frameworks.
Dato’ Fad’l Mohamed said, “This collaboration reflects our shared commitment to advancing forest conservation and restoration efforts through both market-based and non-market mechanisms. We particularly look forward to the introduction of Malaysia’s national carbon crediting system, which will enable BCX to expand its offering to include both national and international labelled carbon credits, thus broadening access and accelerating impact.”
Suhaini Haron expressed her confidence in Bursa Malaysia regarding this strategic collaboration, “The introduction of the FCO next year is a significant stepping stone signalling the beginning of Malaysia's vision to become a low-carbon nation. It is not only a reflection of Malaysia's commitment to saving our forests but also an indication of our willingness to play a useful role in the world's carbon economy. Having FCO traded on BCX would highlight Malaysia's leadership in developing credible, transparent, and nationally accepted carbon instruments. This action will create room for additional private sector initiatives to support global action on climate, while keeping the value of our natural forests intact for future generation."
