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Malaysian Social Stocks Beat the Market

Submitted by: Owens, Williams & Wood (OWW) Consulting

Categories: Socially Responsible Investing

Posted: Feb 05, 2007 – 08:07 AM EST

 

New CSR Index shows that Socially Responsible Investment (SRI) in Malaysia can out-perform the market

Feb. 05 /CSRwire/ - KUALA LUMPUR AND SINGAPORE- February 5, 2007 - Share prices in companies that practice good Corporate Socially Responsibility (CSR) have out-stripped the recent bull-run on the KLCI according to OWW Consulting, a specialist CSR company based in Kuala Lumpur and Singapore.

Arshad Adam, Finance Director of OWW Consulting said, “From 3rd January to 5th February 2007, companies on the OWW ResponsibilityTM Malaysia SRI Index have gained 11.12% compared with 9.73% on the KLCI”

“Experienced analysts expect the current bull-run to continue which leads us to believe that the prices of Socially Responsible Investment (SRI) stocks will also continue to provide excellent returns,” he added.

During 2006, the OWW ResponsibilityTM Malaysia SRI Index produced an 18.3% increase in price terms at much lower risk than the overall market.

The OWW ResponsibilityTM Malaysia SRI Index was launched in November of last year and includes companies listed in the Top 100 on the Bursa Malaysia Main Board. To be included in the index companies must pass a stringent set of criteria based on their CSR performance in Corporate Governance, Workplace Practices, Stakeholder Engagement, Environmental Policy and Community Contributions.

From 14th December 2006 all Public Listed Companies (PLCs) are encouraged to include a statement of their CSR performance in their annual reports as a consequence of changes announced in the 2007 Budget Statement in September last year. CSR reporting will be mandatory for companies with financial years ending on or after December 31st 2007 but voluntary reporting is being promoted by Bursa Malaysia before the mandatory period begins.

“As more companies report their CSR performance the scope of the OWW ResponsibilityTM Malaysia SRI Index will widen to include more stocks” said Arshad. “This will provide a wider choice for SRI Fund managers which have so far been out of their reach because credible, consistent and comprehensive assessments of the CSR performance of Malaysian companies have not been available.

“Our new assessment system and our SRI Index fill this gap,” he added.

The OWW ResponsibilityTM assessment process aims to help the SRI community to access up-to-date and reliable information on the social performance of companies in Malaysia and Singapore to provide opportunities for diversification of fund portfolios outside of Europe and the US.

Dr Geoffrey Williams, Managing Director of OWW Consulting, said, “The recent surge in Malaysian stocks has been driven to a great extent by overseas investors who are attracted by strong growth potential. Further investment funds could also be attracted from SRI Fund managers who account for more than RM14 trillion globally.”

The experience of stock markets in other developing economies shows how successful this strategy can be. The Johannesburg Stock Exchange introduced its SRI Index in May 2004 and now has more than US$1.6 billion in socially responsible funds as a result.

“Attracting just US$1 in every US$1,000 dollars of global SRI Funds would bring around RM14 billion into the Malaysian market,” Williams said.

“Malaysia has been at the forefront of the RM1 trillion Syariah compliant financial industry which are socially responsible investments by definition,” he added. “By drawing on this expertise and experience and by building on the growing CSR momentum in Malaysia, we believe that KL could become a regional centre for SRI within only a few years.”

The OWW ResponsibilityTM Malaysia SRI Index is the first in the OWW ResponsibilityTM SRI Index Series which will initially cover Malaysia and Singapore and in future other South-East Asian economies. The OWW ResponsibilityTM Singapore SRI Index will be launched at the end of February 2007.

Further details and free downloads can be obtained from:

www.oww-consulting.com

enquiries@oww-consulting.com

BACKGROUND INFORMATION FOR REPORTERS

About Owens, Williams & Wood Consulting (OWW) Sdn Bhd

Owens, Williams & Wood (OWW) is a technology-based business solutions company located in Malaysia and Singapore. OWW offers a range of unique web-based technologies to enable clients to improve their management and communication of corporate social responsibility (CSR) and sustainability.

In addition to the Responsibility™ SRI Index Series, our portfolio includes the following services:

  • Responsibility™ Online self-reporting and rating tool for responsible business management.

  • Responsible Asia™ Training, communications and strategies for responsible business.

  • Asian Opinions™ Opinion surveying solutions for stakeholder engagement.

  • Private Client Research Services Fully bespoke analytical reports and recommendations.

  • Industry Research Macro views, analysis and reporting of industry benchmarks.

    OWW Consulting is a Malaysian Multimedia Super Corridor (MSC) Status Company and a member of the Singapore Compact. We are also the first company in Malaysia and Singapore to sign-up to the United Nations Principles for Responsible Investment (UNPRI)

    Arshad Adam - Finance Director (BBA, MSc, FCCA) - is a founding member of OWW Consulting and was appointed Finance Director in 2006.

    Arshad is formerly Assistant Professor of Accounting and Deputy Director of the MA/MSc programmes at Nottingham University Business School, Malaysia Campus. He is a Chartered Accountant and a Gold Medal Graduate in Business Administration from the International Islamic University Malaysia. He holds an MSc (with Distinction) in International Business Management from the University of Nottingham. He has extensive international experience in training of finance professionals in accounting qualifications for ACCA and CIMA throughout South East Asia.

    Arshad has extensive commercial experience and has direct personal experience of overseas investment projects including outsourcing and cost consultancy services to international clients mainly from East Africa and French speaking countries. Outsourcing projects have been conducted in South East Africa, China, South Asia, the Middle East, Europe, Turkey and Zimbabwe.

    His professional work as an accountant has involved audit and "off-audit" experience in operations management and cost management and reduction in Mauritius, Malaysia, Indonesia and Singapore.

    Contact: arshad.adam@oww-consulting.com Mobile: +601 2422 6881

    Dr Geoffrey Williams - Managing Director (MA(cantab), MA(oxon), MA(econ), PhD, FRSA) - is a founder and Managing Director of OWW Consulting in Singapore and Malaysia.

    He is a graduate of the University of Cambridge and holds a Masters degree from the University of Liverpool and a PhD in economics from UEA Norwich. He is an Associate Member of the Centre for Business, Organisations and Society, School of Management, University of Bath, United Kingdom and was elected Fellow of the Royal Society of Arts (RSA) in 2004.

    Geoffrey was formerly Fellow in Economics at Pembroke College, University of Oxford and Research Fellow at London Business School. Most recently he was Associate Professor in Economics at Nottingham University Business School, where he was also Director of Research and Director of the PhD Programme.

    He has extensive experience of designing and directing research projects which have included work for the UK Government (DTI), European Commission (DG-Research), the European Standards Agency and others. He has also worked with private companies and charities including PA Consulting Group, the leading UK law firm Allen & Overy and the Wellcome Trust UK. He was an economic adviser to Her Majesty’s Opposition and was a member of the Independent Bank of England Commission 2000-2001.

    His most recent research has focussed on Corporate Social Responsibility in a global context and in particular on the factors that determine the experience and success of CSR initiatives in different socio-political contexts, including culture, religion and the historical development of national business systems. He also has an active research interest in the development of practical management tools for the assessment and implementation of successful CSR systems within companies which has lead to the development of the OWW Consulting Responsible Management Tool.

    His work has been published in leading academic journals including Oxford Review of Economic Policy, Journal of Business Ethics, Journal of Economic Behavior and Organisation, Research Policy, Business Ethics: A European Review, Review of Income and Wealth, European Competition Law Review, Review of Financial Economics, Journal of Behavioral Finance, Journal of Macroeconomics, Information Economics and Policy, Applied Economics, Applied Financial Economics, International Review of Business and Economics.

    His research output has had direct impact in the business world and has been covered in the media including the Financial Times, the Wall Street Journal, Bloomberg, CNBC and the Sun newspaper in the UK.

    Contact: geoffrey.williams@oww-consulting.com Mobile: +601 6677 4546

  • For more information, please contact:

    Arshad Adam Owens, Williams & Wood Consulting
    Phone: Mobile: +601 2422 6881
    Geoffrey Williams Owens, Williams & Wood Consulting
    Phone: Mobile: +601 6677 4546

     

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