KUALA LUMPUR (May 20): Public Bank Bhd emerged among the top 10 environmental, social and governance (ESG) scorers within the financial services sector based on CLSA’s findings from the research firm’s corporate governance (CG) survey involving over 1,180 companies across 13 sectors in Asia for 2020.

Today, CLSA regional head of ESG and thematic research Seungjoo Ro said in a presentation during the CLSA-Asian Corporate Governance Association joint virtual media briefing that the survey's findings showed an 8% increase in CG watch scores in 2020 vs 2018, with 12 sectors improving.

“Fairness and transparency are the strong areas, while independence continues to be the weakest link — although it is also the area that has improved the most. 

"Materials and capital goods [sector] ranks no.1, followed by technology, healthcare, financial services and insurance. Hotels/leisure, power/utilities and conglomerates rank the lowest.

"Finance/insurance has improved the most, followed by power/utilities and technology. We see supporting data that connects good corporate governance with long-term share-price performance,” Ro said.

According to CLSA's presentation, which was distributed to reporters covering the media briefing, Public Bank was ranked seventh with a 2020 ESG score of 86 within the financial services sector.

Australia-based Magellan Financial Group clinched the top spot with an ESG score of 92.6 while the 10th spot went to Platinum Investment Management Ltd, which received an ESG score of 85.5, CLSA said.

Platinum Investment is also based in Australia, according to CLSA’s presentation.

Asian Corporate Governance Association secretary-general Jamie Allen, who was also at the media briefing, said Malaysia is a market where there is a close connection between public governance and corporate governance. 

"What I mean by that is that when governments change, they appoint new people to run some of the government-linked companies or some of the government-linked investment companies, or some of the other statutory boards or bodies in Malaysia,” Allen said.

Asian Corporate Governance Association's presentation shows that Malaysia’s 2020 CG ranking fell one spot to fifth place from fourth place in 2018.

The presentation which listed the CG rankings of 12 countries showed that Australia retained its top spot in 2020 after the country was ranked number one in 2018. 

Indonesia secured the 12th spot in 2020, unchanged from its 2018 ranking, according to the presentation.

According to the presentation, the respective countries' CG rankings take into account factors including public governance and CG rules in these countries.