Serina Hijjas, the director of architecture firm Hijjas Kasturi Associates Sdn Bhd, said while huge corporations have adopted the environmental, social and governance framework into their operations, many SMEs remain hesitant to do so for fear of costly overhauls.

She said the government must show these companies that investing in sustainability does not mean their businesses will see net losses.

“The missing gap is the SMEs. For years, we have had to prove to them that business as usual is more expensive than not being sustainable,” she said at a forum at Heriot-Watt University today.

On Tuesday, Bank Negara Malaysia assistant governor Madelena Mohamed said export-oriented SMEs, which account for 99% of the Asean business ecosystem, stand to lose US$237.5 billion (RM1.06 trillion) in potential revenue if they fail to transition to greener and sustainable practices.

Madelena said helping SMEs transition to greener practices will not only future-proof economies but also improve resource efficiency, reduce costs, and build resilience against climate change and other disruptions.

Rozila Abdul Rahman, director at project management consultancy Art Projeks, told the forum the long-term financial benefits of obtaining green certification are substantial, even though it may be costly upfront for building and business owners.

“Through the projects we were involved in, we found that electricity bills for green-certified buildings are much lower than for their counterparts who are not green certified,” Rozila said.

Green certification refers to a formal recognition that a building meets certain environmental and sustainability standards.

In 2023, the Green Building Index, Malaysia’s first rating system for assessing the environmental design and performance of buildings, certified over 300 million sq ft of sustainable buildings nationwide.