By SUFEA SALEHUDDIN
SMALL and medium enterprises (SMEs) must play a greater role in driving Malaysia’s sustainability efforts, particularly as global regulations tighten and demand for low-carbon products increases.
Natural Resources and Environmental Sustainability Minister Nik Nazmi Nik Ahmad said SMEs are essential to the nation’s green transition, but face structural limitations that require targeted support.
“Many SMEs are still struggling to adapt to climate-related regulations. They do not have chief sustainability officers or dedicated compliance teams like public-listed companies,” he said at the launch of The Green Factory’s flagship retail store at The Campus Ampang on Tuesday.
Nik Nazmi said the government is aware of these challenges and is working on multi-level initiatives to assist the sector.
He also urged large corporations, including government-linked companies (GLCs) and multinational corporations (MNCs), to take an active role in building capacity across their supply chains.
“We hope bigger companies that rely on SME suppliers will help them switch to more sustainable practices by offering guidance, training, and knowledge transfer,” he added.
He also said Malaysia’s furniture sector, though facing a reduced local timber base, remains a strong contributor to exports and holds significant potential for green transformation.
“There is significant global demand for sustainable wood-based products, particularly from Europe. If we can position our SMEs to meet those standards, the economic benefits will follow,” he said.
Nik Nazmi cited The Green Factory as an example of SME-led innovation in the circular economy.
Originally a school furniture supplier, the company has grown into a sustainability-focused enterprise by upcycling timber waste into premium products, gaining international recognition in the process.
“This is a business that grew from a small workshop into a fully-fledged sustainability enterprise. It shows how local innovation, led by young people, can drive meaningful environmental change,” Nik Nazmi said.
He also pointed to emerging international frameworks such as the European Union Deforestation Regulation (EUDR) and the Carbon Border Adjustment Mechanism (CBAM), warning that Malaysian SMEs could face trade barriers if they are not adequately prepared.
“These policies are coming fast, and if we do not prepare our SMEs now, they will be disadvantaged. That is why we are calling for a whole-of-government and whole-of-supply-chain response,” he said.
Nik Nazmi added that public-facing initiatives such as “Sustainaboleh!”—a sustainability programme held in conjunction with the launch—play a critical role in reshaping both public behaviour and industry practices.
“It is not just about policy— it is about making sustainability tangible and relatable to everyday Malaysians,” he said.
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