Research Objectives

The general objective of this study is to explore and understand the value propositions of ESG and the drivers of its pillars within the C&M industry. Specifically, the research objectives are as follows:

Literature Review

ESG in Communication and Multimedia Industry

The integration of sustainability principles into corporate strategy has become increasingly important across Communication and Multimedia (C&M) industry. Prior practices held onto terms like Corporate Social Responsibility (CSR), while the present era discusses views from one common stance called Environmental, Social and Governance (ESG) that is composed of all the mentioned three factors, which also happens to be a widely used term for discussions related to investments (Linnenluecke, 2022). Traditionally, organizations were evaluated solely on financial performance, but in recent years, stakeholder theory and institutional theory have reshaped this perspective emphasizing the importance of legitimacy, transparency, and ethical accountability across all areas of corporate conduct (Bahadori et al., 2021). Also, the value of ESG initiatives increases significantly when companies are transparent in their reporting (Fatemi et al., 2018). Hence, the ESG approach provides a more holistic lens, capturing environmental concerns like energy efficiency and carbon emissions, social aspects such as employee well-being and data privacy, and governance issues related to transparency and board oversight. Friede et al. (2015), in their meta-analysis of over 2,000 empirical studies, confirmed that strong ESG performance is positively linked to financial returns, which makes ESG integration not just an ethical imperative, but a financially sound strategy as well.

In the C&M industry context, Jasni et al. (2020) found that leading Malaysian telecommunications firms are increasingly integrating ESG practices such as ISO 14001-certified environmental management, energy efficiency, employee training, and governance measures like CEO-chair separation as strategic investments rather than symbolic gestures. These initiatives, driven by stakeholder expectations and legitimacy concerns, have shown measurable outcomes including waste reduction and energy savings. The study underscores a shift from compliance-based ESG reporting to proactive, value-driven sustainability, in line with growing scrutiny from ESG indices like FTSE4Good Bursa Malaysia. Similarly, Maralov et al. (2024) conducted ESG analysis of Kazakh telecom's activities and using expert interviews and an ESG ratings framework. They noted strong performance in climate management and human capital but highlighted weak coverage in environmental impact and social outreach. This is particularly relevant for developing countries like Malaysia, where ESG adoption is still evolving and not always consistent across organization. Therefore, Mohd Radzi et al. (2025) called for more balanced, stakeholder-inclusive strategies within the C&M industry as efforts were largely social rather than environmental or stakeholder-centric. Together, these studies underline ESG is not just a reporting exercise, it's a strategic necessity that connects business performance with long-term societal value.

Value Propositions

The value propositions for the ESG pillars in the C&M Industry are multifaceted, emphasizing sustainable practices, social responsibility and corporate governance (Tripopsakul & Puriwat, 2022). These propositions are critical for fostering long-term value and resilience in a rapidly evolving market. Organizations like Samsung and Huawei are integrating ESG into their strategies, focusing on Green ICT and sustainable practices to enhance operational efficiency and reduce environmental impact (Huang, 2024) while, Abdul Razak et al. (2023) found that improved ESG performance, particularly in governance, correlates with reduced credit risk, highlighting the financial benefits of environmental stewardship. Strong governance frameworks not only mitigate risks but also align corporate practices with stakeholder expectations, fostering transparency and accountability (Efunniyi et al., 2024). Becchetti et al. (2022) in their studies stated that a relational approach to social responsibility emphasises the importance of community ties and employee well-being, which can enhance brand loyalty and trust. Promoting a holistic ESG narrative to avoid greenwashing, which is essential for competitive advantage (Routray, 2024). According to Bhattacharya and Bhattacharya (2023), emphasizing governance in ESG strategies can lead to better stakeholder communication and improved business model innovation. While the focus on environmental aspects is prevalent, neglecting social and governance dimensions can lead to consumer scepticisms and regulatory scrutiny, underscoring the need for a balanced approach to ESG integration.

The ESG Pillar Drivers

The drivers of ESG adoption in the C&M industry are diverse and interconnected, reflecting both internal strategic priorities and external stakeholder expectations. These drivers influence not only sustainability practices but also shape corporate governance structures and social responsibility commitments. According to Potharla et al. (2024), key social sustainability indicators such as employee welfare, respect for human rights, and community engagement serve as critical motivators for ESG adoption in C&M companies. These social components are instrumental in shaping public perception and stakeholder trust. Similarly, Chen et al. (2023) identified several business-oriented drivers behind ESG integration, including the enhancement of corporate reputation, increased access to funding, reduced financing costs, and improved firm valuation, all linked to strong ESG performance. Complementing these views, Li et al. (2021) highlighted that the social (S) dimension of ESG is influenced by community development, inclusive labour practices, and diversity programmes. It highlights how social responsibility activities motivate employees, enhance stakeholder engagement, and improve workplace behaviour, which can lead to greater employee satisfaction and productivity. Collectively, although not sector-specific, these principles are applicable to the C&M industry, emphasizing the importance of compliance-driven but increasingly seen as a value-creating mechanism embedded in long-term strategic planning.

Methodology

Findings and Analysis

This study collected insights from 11 senior informants across Malaysia's C&M industry, comprising representatives from the telecommunications, postal and courier, and broadcasting sectors. The sample included seven males and four females, all with at least a bachelor's degree, holding senior roles such as Head of Sustainability, Managing Director, and Chief Operating Officer. Participants represented both listed and non-listed entities, including national and multinational companies licensed by MCMC. ESG adoption levels were assessed across three categories: Level 2 (Strategist), Level 1 (Pragmatist), and Level 0 (Minimalist). A total of seven companies (four telecom, two postal/courier, one broadcaster) were rated at Level 2, indicating strategic integration of ESG into business operations and stakeholder engagement. Two companies (postal/courier) were assessed at Level 1, demonstrating early-stage ESG efforts focused mainly on compliance and cost efficiency. Two companies (broadcasting) were rated at Level 0, showing minimal ESG awareness and no formal implementation. These results highlight a clear disparity in ESG maturity across sectors, with telecommunications leading in structured adoption, postal and courier services showing mixed progress, and broadcasting generally lagging behind.

The findings addressed four research questions. First, ESG value propositions aligned with strategic objectives were grouped into four key themes: societal value creation, market and ecosystem value, strategic and regulatory alignment, and internal organisational value. These propositions reflect efforts to serve communities, comply with regulations, build sustainable supply chains, and promote leadership-driven ESG cultures.

Second, the study identified 22 key ESG drivers, divided into internal (e.g., board of directors, training and workshop, operational cost savings) and external (e.g., regulatory and policy environment, competitor differentiation, media and public trust), mapped across the phases of ESG integration: adoption, implementation, and effectiveness. These drivers shaped how ESG was embraced across companies and summarize in Table 1.

Table 1: Drivers influence the adoption, implementation, and effectiveness of sustainability initiatives

Third, in Table 2, ESG was found to positively impact financial performance (e.g., cost savings, investor appeal), operational efficiency (e.g., energy optimisation, digital workflows), and market competitiveness (e.g., brand credibility, tendering advantages); though sector-specific differences were evident.

Table 2: Effects of ESG on financial, operational and market competitiveness.

Lastly, a comparative analysis showed that ESG motivations and practices vary significantly by sector. Telecommunications focused on governance and digital transformation, postal and courier firms emphasised hybrid work, broadcasting relied on values-driven content without strong financial ESG systems. These variations reinforce the need for sector-specific ESG frameworks amid a one-size-fits-all approach.

Recommendations

This study provides sector-specific, evidence-based recommendations to enhance ESG adoption across Malaysia's C&M industry. Recognizing the varied ESG maturity across sectors, the study recommends that regulators like MCMC develop customized ESG frameworks for telecommunications, broadcasting, and postal/courier organizations, reflecting their operational realities and sustainability priorities. Telecommunication organizations need advanced ESG metrics focused on infrastructure and digital inclusion; postal/courier should prioritise last-mile logistics and environmental compliance; while broadcasters require structured tools to translate social content into measurable ESG outcomes.

To strengthen governance, board-level oversight, ESG-linked performance reviews, and accountability systems should be institutionalized. For organizations in early ESG stages, external incentives like license renewal requirements and procurement eligibility can motivate deeper engagement. To overcome inconsistent implementation, sector-wide ESG toolkits (e.g., guidelines, templates, and checklists) should be introduced to embed ESG into daily operations.

The study also highlights the need for industry-wide capacity-building, with training modules tailored to all organizational levels. To communicate ESG value effectively, companies should adopt standardized reporting frameworks (e.g., GRI, ISSB) and develop sector-specific ESG dashboards for real-time performance tracking. Public agencies are encouraged to offer R&D grants and incentives for ESG-driven innovations.

Finally, peer-learning platforms should be established to foster knowledge sharing, where mature telcos can support emerging postal and broadcasting companies. ESG should be embedded across business functions (e.g., procurement, HR, supply chains, and content creation), in order to position ESG not as an add-on, but as a core strategic pillar.

Conclusion

Amid growing sustainability momentum, this study highlights the complex, sector-specific realities of ESG adoption within Malaysia's C&M industry. While ESG is increasingly seen as a strategic priority, its implementation varies across telecommunications, postal/courier, and broadcasting sectors each shaped by distinct missions, stakeholder demands, and regulatory maturity. ESG value propositions, from digital inclusion to social equity, are driven by internal leadership and culture, as well as external pressures like regulation and investor expectations, progressing through adoption, implementation, and effectiveness phases.

When ESG is embedded into core operations and supported by clear metrics, reporting systems, and inclusive policies, it delivers measurable impacts such as cost savings, operational resilience, and enhanced brand credibility. However, the risk of superficial or symbolic ESG efforts underscores the importance of adopting data-driven and transparent practices.

For industry players and policymakers, the key is to design sector-specific, scalable ESG strategies aligned with operational contexts and national sustainability goals. This study offers not only insights but also a roadmap for strengthening ESG integration across a vital and fast-evolving industry.

References