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Sustainable property development by Malaysian property companies
Article in Property Management · October 2015

DOI: 10.1108/PM-02-2014-0008
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Sustainable property development by Malaysian property companies
Muhammad Najib Razali Yasmin Mohd Adnan
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Sustainable property Sustainable

property
development by Malaysian development
property companies
Muhammad Najib Razali 451
Department of Real Estate Management, Universiti Teknologi Malaysia, Received 4 February 2014
Johor Bahru, Malaysia, and Revised 4 June 2015
Accepted 11 June 2015
Yasmin Mohd Adnan

Department of Estate Management, Faculty of Built Environment,
Universiti Malaya, Kuala Lumpur, Malaysia
Abstract
Purpose – The concept of sustainability has become increasingly essential to property development,
especially in recent years. The purpose of this paper is to assess the level of sustainability practices
among listed property companies in Malaysia.
Design/methodology/approach – Using content analysis, company websites and annual reports,
the level of sustainable practices among property companies in Malaysia will be examined and assessed.
The paper will also rigorously assess the sustainability strategies employed by using an attributes
scorecard, which takes into account several attributes concerning sustainability issues.
Findings – The findings have showed sustainable property development concept among listed
property companies can be categorised as low level, although this is increasing.
Originality/value – Given the increasing significance of sustainability issues – especially in property
development – this paper provides a more informed investment decision strategies regarding the
implementation of the sustainability concept in property portfolio; a consideration that has increasingly
come into focus amongst international property actors.
Keywords Malaysia, Annual report, Website, Sustainable, Property companies
Paper type Research paper
Introduction
The sustainability concept has rapidly grown in importance in recent years, with
awareness becoming more widespread in many disciplines. This concept is still poorly
defined, but it seems to contain certain features which make it distinct rather than
conservation (Brandon, 2010). The aim of the concept of sustainability is to allow future
generations to reap the benefits from current property developments, but at the same
time to not be disadvantaged due to the effect of current developments. Development
which involves built environment elements such as production, operation, maintenance
and disposal of buildings, infrastructure, land management and project management
are all from man-made capital. Therefore, sustainability concept is now being adopted
in the development process to ensure the interaction between environment and development
is synergised.
Sustainable development issues arise from environmental problems, resulting in
pollution and damage to the earth. Through industrialisation and globalisation, the standard
of living in the developed world has soared from bare subsistence to affluence, while the Property Management
majority of people in the developing world remain subject to destitution (Membaru, 1998). Vol. 33 No. 5, 2015
pp. 451-477
Sustainable development concept comprises of three pillars which consists of economy, © Emerald Group Publishing Limited
0263-7472
social and environmental. In theory, sustainable development is defined in terms of the DOI 10.1108/PM-02-2014-0008
PM pattern of structural changes in natural and man-made capital stock, inclusive of human
33,5 capital and technological capabilities. This ensures that at least a minimum socially desired
rate of growth in the long run is feasible (Karshenas, 1994). With the sustainable concept
emerging in many countries, all development projects need to take into account sustainable
features such as the modelling of elevations and choice of materials. There is no doubt that
applying the sustainability concept to development projects will benefit not only
452 organisations, but also their parent-countries through better monetary returns. It will also
improve the organisations’ image among communities, and reduce damaging effects to the
environment. Development projects are closely related to real estate projects, thus property
plays a major and active role in the life cycle process of development.
In countries’ development process, real estate sector play a major role. This is due to
the need for the physical space to run the countries’ economic activities. Real estate
development is driven by demand and supply relationships. As a result, real estate has
become the catalyst in the economic growth of a country. Unfortunately, the real estate
sector has been recognised as a major contributor to the global environmental
degradation because it involves several activities, such as, construction, the built
environment and the building management. Real estate sector involves several actors
within their activities; the participants are integrated to ensure the success of the real
estate project. Within property markets, several actors such as, contractors, designers,
engineers, researchers, governmental authorities, or certain occupiers and clients have
been concerned with aspects of sustainable development for a considerable period of
time (Lutzkendorf, 2007).
Property is a critical issue for sustainable development because of large shares of
resource and energy consumption (Bugl et al., 2009). This is echoed by Kibert (2007)
which mentioned sustainability is affected by material extraction, product
manufacturing and assembly, building structure, system maintenance, replacement
and waste disposition. These activities contributed to the negative impact of real estate
development projects to the environment. This has been highlighted by Keeping et al.
(2007) which mentioned that the property industry has a major impact on the
environment, with buildings contributing up to 50 per cent of CO2 emissions, 40 per cent
of energy requirements, 16 per cent of water usage, 40 per cent of solid landfill waste,
50 per cent of raw materials and 71 per cent of electricity consumption. Studies by
Newell and Manaf (2008), also stressed on similar issues. Their findings revealed that
buildings contributed up to 50 per cent of carbon dioxide emissions, 40 per cent of
energy requirements, 16 per cent of water usage, 40 per cent of solid landfill waste,
50 per cent of raw materials and 71 per cent of electricity consumption. Activities by
any property sector involving building construction and operation will result in a major
impact on the environment. The built environment is responsible for around half of all
greenhouse emissions (Wilkinson et al., 2011). Another study by Morledge and Jackson
(2001), highlighted the impact of the real estate development to the environment and
mentioned that building sector generated a large amount of pollutants, including noise,
air, solid waste and water.
Previous studies have shown that the real estate sector is the biggest sector that
contributes to the global environmental problem. The activities in real estate that
contribute to the environmental problem stem from the property developers who are
the main players in the property business. Therefore, it is crucial that the concept of
sustainability needs to be enforced in the real estate sector. As such, the concept
of sustainability in real estate also known as sustainable development was
introduced to balance between development and real estate. The generalised concept
of sustainable development needs to be translated and integrated into the areas Sustainable
of responsibility and action of the different actors (industry players) involved property
(Lutzkendorf, 2007).
Interest on sustainable concept has grown rapidly for the last five years. This is due
development
to the benefits earned from the implementation of the sustainable concept. The concept
of sustainable must start within the organisation itself or through effective people
management. Increase environmental or sustainability awareness, particularly on 453
the part of stakeholders, may lead organisations to focus more on improving their
environmental performance management practices (Gadenne et al., 2012). One of the
ways to improve the level of sustainability awareness in the organisation is through the
reward system. The monetary rewards improved the environmental as well as social
responsibility performance (International Federation of Accountants (IFAC), 2005).
This will eventually create social sustainability programme in the organisation. Hence, the
awareness programme will create effective management people to manage sustainable
development projects.
The Environmental Management System (EMS) is an advanced system to ensure
the successful implementation of the environmental/sustainability/green concept which
promotes best practice and enhance environmental performance. It can be demonstrated
that a clear and fully integrated EMS, such as ISO14001, will not only encourage
organisational environmental improvement, but will also promote better environmental
understanding, improved facilities transparency and play a significant role in developing
an appropriate systems approach (Walker et al., 2007). Consequently, large organisations
which are mostly listed companies, try to fulfil the EMS requirements by conducting
their business activities in an environmentally or sustainability friendly manner. This
is also supported by Matthews (2003), which mentioned large organisations are
increasingly seeking to ensure that they conduct their activities in a way, which is not
merely compliant with the growing body of legislation, but clearly demonstrates that
their business activities are environmentally sustainable and that they are seen to be
acting in a socially responsible manner.
The EMS programme will also lead to an audit exercise, within the organisation or
business activities. According to Ahmed et al. (1998), an effective environmental audit
system should compromise of the following elements:
(1) environmental policy;
(2) environmental reporting system;
(3) data collection procedures and environmental database;
(4) executive environmental information system; and
(5) decision support system for analysing, planning and formulating corporate
environmental strategy.
EMS auditing process is a reflection of the high commitment of companies towards
sustainability issue. This programme could be considered as an advanced sustainability
assessment for companies. The audits could benefit companies as it is one way they can
market their credibility. Audit records showing companies’ compliance to set regulations,
can at other times also act as a certificate, which can be used for accreditation and
marketing purposes (Zutshi and Sohal, 2003).
Sustainable concept will give good image to the company, as it will portray the
commitment of the companies to the environmental problem. This is also part of
PM the corporate social responsibility (CSR) from the company to the local community.
33,5 The companies also respond to the government mandates aimed at reducing carbon
footprints, public pressure, new business opportunities and the shift towards greater
corporate transparency especially in term of sustainability agenda. Companies start to
recognise the benefits of going green with consequent impacts on both occupiers and
investors driven by the desire to highlight CSR credentials (Pivo and McNamara, 2005).
454 Beeks and Brown (2006) mentioned that firms with more effective corporate governance
make better information disclosures. Moreover, institutional investors have started using
publicly listed real estate and cost-efficient, more liquid alternatives for their direct real
estate holdings (Brounen and Kok, 2010). As such, companies with better corporate
governance (reflected through their acknowledgment of sustainable concept initiatives

and efforts), will help Malaysia to achieve sustainable development in the long term.
In addition, the mention of a company’s sustainable efforts in its annual report, or on its
website will boost its corporate image, thereby attracting local investors as well as
international institutional investors.
Sustainable property development

Real estate industry plays a vital role in meeting the needs of society and enhancing life
quality. This is because people always need real estate as an essential asset in their life.
As such, in a growing population, the real estate’s demand and supply is active throughout
the year. However, responsibilities in ensuring consistent real estate activities and product
with set environmental policies need to be clearly defined. Sustainability in real estate can
be defined as those services offered by all stakeholders in the property business that aim to
enhance and sustain the concept of real estate and sustainability. Sustainable property
development concept has very high correlation with the environmental interpretation. This
implied an environmental interpretation of sustainability based on resource consumption
and pollution (Sayce et al., 2007). Sustainability has emerged as an overarching notion from
the environmental discourse and must therefore ultimately, give direction to the structure
and application of environmental assessment methods (Cole, 2010).
However, many key players in real estate sector such as, developers and bankers are
struggling to understand the impact on its monetary structure by implementing the
sustainability concept in their real estate projects. For example, research done by Ries
et al. (2006) revealed that decision to build a green building made sense from both an
environmental and economic point of view. This was later agreed by Burnett (2007)
who did an investigation on the economic dimension of sustainability concept in
building. His findings revealed that in order to implement sustainable element in the
building, the investors need to exercise the maximum cost approach. He added that
investment in quality process such as planning, design, construction, commissioning
and subsequent operation of buildings, could enhance performance (sustainability) and
add value. From the sustainable development point of view, the cost at the early stage
could be higher than conventional development. This is agreed by Goh and Sun (2015)
who mentioned that the need to influence critical decisions related to construction and
operating cost, should be at the early stages of the design process when potential is at
its highest.
Nevertheless, several researches have also been done to integrate the concept of
sustainable in real estate with a wider desire for the industry to aim for sustainable
property development. However, the majority of these studies only explore the concept
of sustainability in the building; this is known as green building concept. For example,
Keeping and Shiers (1996) were pioneers in the study of sustainability in real estate,
having introduced green refurbishment concepts in property development. Gou et al. Sustainable
(2011) assessed whether green buildings are more satisfactory and comfortable. Their property
findings revealed that some green buildings enjoyed higher satisfaction and comfort,
while others attracted lower satisfaction and comfort. Their research findings also
development
suggested that green building users were more forgiving about their buildings. Similar
studies have also been undertaken by Abbazadeh et al. (2006), and Leaman and Bordass
(2007), which exposed the spread of satisfaction between the best green buildings and 455
conventional buildings. Therefore, it would be good if the real estate players emphasise
the environmental issues that concern their projects. This would serve to create broader
public awareness and highlight the strong commitment of the companies towards
environmental problems.
Only a few bother to investigate and formulate the concept of sustainability into
the whole process of the real estate cycle. For instance, Newell (2009) investigated the
significance of sustainable best practice in retail property. He suggested several measures
to reinforce sustainability leadership in retail property, such as:
(1) the use of green power sources;
(2) carbon bio-sequestration initiatives to make specific retail properties carbon
neutral;
(3) the use of green leases and retail tenant initiatives;
(4) participation in emissions trading schemes; and
(5) setting environmental sustainability key performance indicators for asset
managers.
In his conclusion, Newell (2009) noted the significant contribution retail property has
made towards the sustainable property agenda at the international level. His study also
identified some of the sustainability leaders in the retail property sector. Another study
by Newell looked at the significance of environmental sustainability in the Australian
Listed Property Trusts (LPTs) (Newell, 2008). His findings revealed that Australian
LPTs appeared to be strategically implementing a wide range of environmental
sustainability processes. The results showed the strong leadership role of the
Australian LPTs in implementing best practice in environmental sustainability in
commercial property.
The other study that explores the possibilities of integrating the concept of sustainability
into real estate sector as a whole was by Lützkendorf and Lorenz (2007). However, their
research emphasised more on the sustainable property risk assessment. Interestingly, the
study revealed that successes in strengthening the demand for buildings contribute
positively to sustainable development. This is due to the protection of natural resources, the
reduction of negative impacts on the local and global environment and occupants’ health.
To ensure the concept of sustainability is successful in the real estate, the most
important element is the individual responsible for every tasks involved in the real
estate life cycle. In the real estate life cycle, the management of sustainable
development must be through the individual involved in every stage of real estate
process from planning and the implementation of the project. However, the issues
surrounding sustainable management are many-faceted and complex and there is a
corresponding need for sophisticated and multi-dimensional management skills
(Franks, 1994). Hence, managers and stakeholders should have high awareness on
the long-term benefit of the implementation of sustainability concept in real estate.
PM For sustainability evaluation, the outcome of property development must not just
33,5 rely merely on administrative procedure, but most importantly, create a culture
(Kauko, 2012).
To create the culture, the stakeholders of the real estate industry need to know about
the benefits in implementing the concept of sustainability. Some of the potential
benefits in implementing sustainable development practices are beginning to emerge;
456 as such, industry actors are now more aware that there are more advantages than the
conventional approaches. These benefits include:
(1) lower energy costs through the use of simple, low-tech heating (or air conditioning)
and power installations;
(2) lower maintenance costs due to simple building services which are easily
accessible, and low-tech equipment being cheaper to repair or replace; and
(3) reduced absenteeism, which has a demonstrated link to “healthier” buildings
(Keeping and Shiers, 1996).
The revelation of sustainable issues by the organisation to the stakeholders will show the
high commitment of the companies in participating in the sustainability and environmental
programme. This includes internal mechanisms on disclosure and transparency of
financial report. At the global level, this has started approximately 22 years ago. According
to Kolk (2005), financial reports which are concerned with sustainability issues has
attracted public attention on certain companies. Although in many cases, reports on
sustainability in financial reports are rather inexplicit, some companies put an extra
effort to highlight the importance of sustainability issues in organisations through their
financial reports. In many cases, sustainability sections in annual reports continue to be
treated as separate sections. The same applies to the corporate governance sections
related to sustainability which are included within these reports. These sections are really
linked and reported together as this may offer new opportunities for an integrative
approach in addition to the accounting itself (Kolk, 2008).
Sustainability property development in Malaysia

Malaysia is lagging behind the major markets of Singapore, Australia, UK and
the USA, with sustainability for the property market only being introduced in the
mainstream market in the last two years. As part of its determination to implement
sustainable concept in property development, the introduction of “housing green rating
tools” by The Real Estate and Housing Developers’ Association of Malaysia (REHDA),
commonly known as GreenRE, is a starting point by the real estate sector in Malaysia.
This initiative encourages housing developers in Malaysia to “go green” by incorporating
renewable energy technology into buildings, opting for passive designs, and improving
the shading and positioning of the building to reduce cooling costs. There are plans
to extend this initiative to commercial buildings in the near future. As a result, Malaysia
has seen several buildings incorporate the sustainable building or green concept. These
buildings are therefore eligible for certification by one of various foreign rating systems
or Malaysia’s Green Building Index (GBI) system, “GBI Malaysia”. Nevertheless,
Malaysia started the sustainability initiatives especially for the building by implementing
GBI initiatives. The introduction of the GBI accelerates the trend of the green concept,
especially in residential property.
This is because the rise of the sustainability discourse during the 1990s and
2000s has had a profound impact on the sustainability services market, especially in
countries where the public administration took initiative early on (Yudelson, 2008). Sustainable
This includes Malaysia which follows similar methodological approach tools property
such as BREEAM and LEED. On top of that, in 2009 Malaysia also launched a
National Green Technology Policy (NGTP) to prove the sincerity of the Malaysian
development
Government’s desire to implement green initiatives in the country. The NGTP
offered several incentives, such as green technology research and innovation towards
commercialisation, the promotion and public awareness of green technology, 457
the application of renewable energy and energy efficiency programmes and the
application of the GBI. Furthermore, the 2009 National Policy on Climate Change
also strengthened sustainable development in Malaysia through the promotion of
green buildings in the commercial sector. According to Sood et al. (2011), this was
achieved through the:
(1) application of low or zero energy concepts in the design and construction of new
buildings;
(2) retrofitting of efficient ventilation, cooling and lighting systems;
(3) practice of energy conservation in buildings;
(4) retrofitting of existing buildings to include energy efficiency and renewable
energy fittings; and
(5) development of a GBI.
The Malaysian Government has offered a number of financial benefits for GBI-certified
buildings as listed below (amended from CBRE, 2010):
(1) tax allowance: owners of GBI-certified buildings are entitled to a tax exemption
equivalent to 100 per cent of the additional capital expenditure incurred to
obtain the building.
(2) stamp duty allowance: buyers of GBI-certified buildings and residential
properties are eligible for a stamp duty exemption on transfer of ownership
instruments for the certified buildings.
(3) other benefits: including significant energy savings of up to 50 per cent (note:
energy costs can comprise up to 25 per cent of a building’s operating costs).
The increase in sustainable building practices in Malaysia proves that developers have
increased levels of expertise in sustainable design, energy efficiency, waste management,
water efficiency, recyclable materials and resource efficiency.
Besides the GBI, BREEAM and LEED which focused more on building or
commercial property, the government of Malaysia took an initiative to introduce
sustainable initiatives through residential property development. Property
development in Malaysia is dominated by the landscape of residential property.
Housing development in Malaysia is following the principle of “Agenda 21”, which
involves the provision of a housing development that improves the quality of life
without having a detrimental impact on the environment. For a house to become
“green”, every phase of the building process (design, construction and operation) must
incorporate environmental considerations, such as, energy and water efficiency,
resource efficiency, indoor quality, waste and pollution control, house maintenance and
the overall impact of the house on the environment (Abidin et al., 2012). Although this
concept is relatively new in Malaysia, it is increasingly being recognised by property
PM developers. Based on the study by Abidin et al. (2012), there is still much room for
33,5 improvement in order to ensure sustainability concepts become engrained in property
development in Malaysia. Some of their recommendations include:
(1) Revisiting and revising standard rules and regulations to incorporate sustainable
needs.
458 (2) Continuing or even replicating the success of previous seminars, conferences
and workshops to encourage local developers to produce sustainable buildings.
(3) Encouraging collaboration between researchers from local universities and
industry actors, to introduce sustainable or environmental guidelines, tools or
techniques that are workable in the industry.

(4) Using research and successful projects to project sustainable construction as
good business, with many tangible and intangible benefits.
(5) Pushing local suppliers and manufacturers to compete in producing green
products. This will create more opportunities for the green concept to be applied
in medium and even low-cost housing (adapted from Abidin et al., 2012).
In order to increase the awareness of the sustainability in property development in
Malaysia, it is important that the regulatory issue is tackled. To this end, Sood et al.
(2011) proposed a regulatory framework for the green building sector in Malaysia.
They recommend that this framework reflect the involvement of all stakeholders to
meet sustainable development objectives, improve building design, and ensure smooth
implementation of regulatory reforms and effective delivery of services from the
building sector to the broader society. It is based on various marketing, engineering
and economic models.
The Malaysian Government has also improved its actions in relation to climate
change and environmental issues by placing greater focus on sustainable and green
development. This is evident from several measures introduced in recent years, such
as:
(1) the formation of the Ministry of Energy, Green Technology and Water (KeTTHA)
in April 2009;
(2) tax series incentives to support public and private sector investment in green
technology;
(3) the initiation of the NGTP in July 2009, as well as the National Green Technology
Council, chaired by the Malaysian Prime Minister; and
(4) the introduction of the Green Technology Finance Scheme to assist companies
that supply and utilise green technology.
In the future, Malaysia may follow in Australia’s footsteps by using rating and labelling
measures to educate Malaysian society on sustainable building, potentially increasing the
market value of sustainable building and its practice (Othman et al., 2007). However, the
issue of sustainable building in Malaysia is relatively still new compared to other
countries; the GBI in Malaysia is only applicable to new buildings. In their study, Shafii
and Othman (2006) highlighted that one of the major barriers holding back the
development of sustainable building in Southeast Asian countries is the lack of awareness
of sustainability, and how it relates to the building industry. Shaari and Elias (2003) also
found that Malaysian building industry actors have little knowledge of sustainable
building assessment, rating and labelling systems. The need for a sustainable building Sustainable
rating system (SBRS) has become more apparent with increasing demand from building property
end-users for green-rated buildings.
Although the Government and several agencies have acted to promote the concept
development
of sustainable, especially in property sector in Malaysia, several factors have been
identified which can further assist the success of this concept. The focus on sustainable
concept in real estate has only been actively targeting buildings though the green 459
building concept. The focus on the concept of sustainable by other types of property,
especially residential has just recently begun. The successful implementation of the
sustainability concept in Malaysia depends on the following factors:
(1) Government support: the Government of Malaysia must continuously promote

the concept of sustainable and green technology such as renewable energy,
solar energy, infrastructure development and drive marker development. The
Government must also monitor quality through various ISO Certification by
SIRIM (formerly known as Standard and Industrial Research Institute
Malaysia) research and development on sustainability issues.
(2) Building industry support: the recent development of a GBI for new buildings
by the Malaysian Institute of Architects and Institute of Engineers Malaysia
has improved implementation of the building rating system in the Malaysian
building industry. Many architects have recently shifted towards designing
sustainable buildings, leading to an increased demand for this design in the
Malaysian building construction market.
(3) Public awareness: awareness of sustainable development by the general public
has created industry drive and demand for sustainable building designs in
Malaysia. This will likely result in an increased demand for sustainable
buildings in the state, with more developers seeking to certify their buildings
with SBRS to remain competitive in the market.
In summary, it is evident that the Malaysian Government considers several policies
such as GreenRE by REHDA, GBI, BREEAM and LEED as a top priority, having
included it in several national policies. In turn, this prioritisation indicates the
importance of real estate and related sectors towards achieving sustainability status.
This section has described the efforts that have been done by the Malaysian
government to promote sustainability concept in the property development process.
Property companies, as a major player in the property development process, play an
important role to implement this concept. As such, it is important to assess the level of
sustainability concept in the property development that have been implemented in
Malaysia. Previous research only touched on the concept of sustainability in real estate
but the criteria to assess is missing. It is anticipated that the successful inception of the
concept of sustainability is quite slow due to the expected higher construction cost.
However there is still a lack of evidence on how far the concept has been implemented
by the property companies.
Methodology
This paper examines a unique sample using the desk research approach of selected
listed property companies’ annual reports taken from the Malaysian Stock Exchange
(Bursa Malaysia) and companies’ corporate websites. The approach of this paper
involved using company websites and annual report. According to the South Coast
PM Information and Library Services of University Bournemouth (1995), “desk research”
33,5 refers to the identification and analysis of information that has already been compiled
and published in some form or another. In this sense, this type of information is
regarded as “secondary” in nature.
All 79 listed property companies were selected for this paper were based on the
Bursa Malaysia list of June 2013 (see Appendix). Investment in publicly listed shares of
460 this form of real estate has become increasingly popular (Boer et al., 2005). Apart from
annual reports (which each of these public listed companies are required to publish),
company websites can also be a useful tool to determine the sustainability benchmark
of property companies. With listed property companies representing the major
actors of property development in Malaysia, the analysis among these companies

represents the current status of the sustainability concept in the impact of development
to the environment he Malaysian property development.
This research is taken from the research that was done by Newell and Manaf (2008).
However, this research uses advanced variables that act as a base to assess the
sustainability performance among listed property companies in Malaysia. Newell and
Manaf only used 14 attributes which were divided into two major resources: websites
and annual reports. Their case study was also limited to the top 30 companies based on
market value in 2008. This research used 16 attributes with some modifications from
Newel and Manaf (2008) so as to enhance and better assess the sustainable elements in
property development. All of these sustainability attributes were assessed against each
of the listed property companies (through their annual reports) by using equal weighting,
resulting in a sustainability score out of 16. Top-down strategic focus on sustainability
reporting was considered to be more effective than a bottom-up sustainability
micro-practice approach, particularly given the higher priority of the top-down critical
factors identified for successful energy management in Asia (Asia Business Council, 2007).
The data collected was based on the visible information from the companies’ annual
reports. In addition, a list of attributes pertaining to sustainable property development,
referred to as a sustainable property development strategy attributes, is developed.
Each annual report was then reviewed and a score was given to develop an index. This
attributes will evaluate the listed property companies in terms of sustainable property
development elements. A score will be given for each of the variables that the
companies implemented in their property projects.
This paper also seeks to analyse sustainable property development of the listed
property companies in Malaysia to evaluate whether these companies consider the
sustainability concept as a necessity in property projects. A scatter plot analysis was
used to generate a ranking and mean score among the companies. Rank correlation
analysis was also used to identify a connection between the Malaysian listed property
companies and the sustainable property development rankings.
Sustainable property development attributes

This study advances the elements of Newell and Manaf’s research by introducing
more sustainable attributes that corresponds to the latest environmental issues.
Furthermore, since it covers all the listed property companies in Malaysia, the study
will provide a more accurate result in terms of sustainability levels among property
companies in Malaysia. The actual assessment will focus on those projects operated by
these companies as well as the sustainable elements they have implemented.
Newell and Manaf (2008) identified sustainable property strategies at the corporate
portfolio and individual property levels. They considered that while sustainability
involves three dimensions of sustainability (being environmental, social and economic), Sustainable
examples largely focus on the environmental dimension. They added that property
while sustainability involves the three dimensions of environmental, social and
economic sustainability, examples would largely focus on the environmental dimension
development
of sustainability. As such, for this research, based on the model developed by Newell and
Manaf (2008), the sustainable property development attributes will be a model to assess
the level of sustainability practice among property companies in Malaysia. This study 461
encompasses 16 attributes to measure sustainability levels among property-listed
companies in Malaysia (see Table II). Besides Newell and Manaf’s research which acts
as a base of the attributes to assess the sustainability level among listed property
companies in Malaysia, several elements described by other researchers have also

been identified to be major elements in the sustainability concept for real estate.
The following section describes elements from previous research that will act as pillars
for the sustainable property development attributes in this research. All the literatures
from the various researchers, have identified the main attributes of elements to be used
to assess sustainability among the listed property companies in Malaysia. For
clarification, all of these elements are divided into systematic attributes so as to be more
specific and objective for our research:
(1) Bugl et al. (2009) and Kibert (2007) – companies must mention whether their
organisation or business activities comply with sustainability level as property
consumed large shares of resource and energy. It is through manufacturing and
assembly, building structure, system maintenance, replacement and waste
disposition.
(2) Pivo and McNamara (2005) and Beeks and Brown (2006) – the companies needs
to respond to government’s policy on environmental and sustainability. It will
also give companies a more effective corporate governance as well as boost the
companies’ corporate image.
(3) Keeping et al. (2007) and Newell and Manaf (2008) – property industry contributes to
the major global pollution with the construction of building. As such, companies
need to highlight any environmental issues as a result of their projects. This includes
highlighting any involvement in any green projects internally or externally by
adding a special section on their website or in their annual report on the potential
sustainability issues and the companies’ policy to address these issues.
(4) Gadenne et al. (2012) – it is important in order to ensure the successful
implementation of the sustainability concept in business activities, the human
resource division within the organisation, needs to be aware in advance. One of
the ways to improve the level of sustainability is through the reward system.
Consequently, this can create effective management of people. Through the
awareness programme a social sustainability culture will be created and this
can only benefit the local and national communities.
(5) Walker et al. (2007) – the EMS is an advanced systematic programme for
organisation. It can be used as a guideline and checklist to implement the
sustainability and environmental programme through business activities as
well as within the organisation. This will including the environmental audit
programme which aims to ensure the programme is well handled. As a result,
both EMS and the audit programme will ensure the organisation’s conformance
with the environmental code standards.
PM (6) Kolk (2008, 2005) – the suspicion on the environmental impact from the
33,5 development has raised some concerns on the sustainability and environmental
issues. This led to a growing demand for companies to reveal any potential issues
in their report, including the effect these issues will have on their financial status.
The attributes encompasses the elements of sustainability and the green concept in
property, including sustainable policy, sustainable awards, section on sustainable and
462 sustainable initiatives; these were included in the attributes in order to measure the extent
of the implementation of sustainable concepts among listed property companies in
Malaysia through their property development projects. Other attributes which have greater
influence on the environmental issues, such as the green projects and the EMSs, aim to
examine the advanced elements in sustainability; these attributes are considered as an

innovation in sustainability concept. The attributes are designed based on the most basic
sustainability concepts that are easiest to implement to the more complex concepts that are
harder to implement. The basic concepts are the “sustainability concept mentioned”,
“environmental issues statement” and the “special section on sustainability”, whereas
the more complex concepts that are harder to implement, are the “conformance with
environmental code standards”, “sustainable strategies”, “environmental management
system” and the “financial report with integrated sustainability information”. Due to the
anticipated advanced sustainability implementation by developers, all the attributes will be
equally weighted so as to give them an even score at the end of the assessment. However,
for the purpose of assessing the participation of the Malaysian listed property companies
who have sustainability issues, the attributes will not be evenly weighted for their final
assessment scores.
As such, for this research, the environmental aspects will be included in the analysis
assessment. The 16 attributes required to measure sustainability levels among
property-listed companies are based on the model developed by Newell and Manaf
(2008) with extension attributes which covers a much wider aspect of sustainability
concepts in property development. The additional attributes were derived from various
literatures as listed as follows:
(1) Sustainable concept mentioned – to give an understanding to potential and
existing customers/investors on this strategy emphasising the sustainable
concepts in company projects.
(2) Sustainability for corporate governance – the element of sustainability in
company’s governance will give a better image and branding strategy to the
company. This attribute will indirectly contribute towards the level of
sustainability concept in the company’s real estate project.
(3) Environmental issues statement – the company that highlights any
environmental issues in their project will reflect the seriousness of the
company’s participation in the sustainable concept in their property projects.
(4) Special section on sustainability – the special section will give the impression to
investors as well as customers, the companies’ commitment towards
sustainability issues. Furthermore, it will reflect the current action that has
been undertaken by companies participating on environmental issues.
(5) Policy on sustainability – companies which has a policy on sustainability will
include sustainable matters in the company’s general policies. This will show
that the companies have social and environmental responsibilities.
(6) Sustainability award – the award is to encourage staff to practice sustainable Sustainable
way of life in the organisation. This will also encourage project manager and property
sub-contractor, vendor and other sub-ordinate to have sustainability awareness
in the daily works.
development
(7) Green friendly projects – organisation will declare the real estate projects have
the green friendly characteristics such as energy saving, recyclable policies,
recyclable materials, biodegradable materials and others. 463
(8) Social sustainability – programme that has been undertaken or future plan to
increase the sustainability awareness among the local and national communities.
The social elements in sustainability will contribute towards a sustainability

image for the company.
(9) Status of EMS – EMS is a systematic way of management to manage and control
sustainability implementation in the organisation as well as in the execution of
project. The establishment of EMS in organisations indicate the complete
sustainability element in the organisations.
(10) Environmental system audit programme – audit of the environmental
system in the organisation as well as in the project is crucial to ensure the
consistency of the sustainability elements. This will prevent the strategic
plan on sustainability in real estate projects to stagnate at draft level without
execution.
(11) Conformance with environmental code standards – all the real estate projects
starting from the design to completion levels have to comply with the
environmental code standards. It will indicate that the real estate project
complies with the international code for sustainability issues.
(12) Objective targets relating to priority environmental issues – with increasing
problems related to environmental issues, special objectives needs to be
highlighted in order to address critical issues such as sustainable materials,
energy problems, water saving issues and climate problems. These issues need
to be highly recognised in order for organisations to implement sustainability
elements.
(13) Initiatives on sustainability practices – initiatives can be in various forms such
as rebate to customers to install solar energy systems, in-house recycle systems,
recycle of rain water systems, biodegradable materials and others. A company
that includes these initiatives will include the practical elements in their
sustainability campaign.
(14) Awareness programmes – the awareness programmes should not only be
initiated by the government but should include participation by private
companies such as developers. Participation of the awareness programmes by
companies will in itself reflect the sincerity of these companies in implementing
sustainability concepts in the real estate projects.
(15) Sustainable strategies and financial report with integrated sustainability
information – it is very rare for companies to reveal the financial information
related to the sustainability concept that have been implemented in the
companies. Companies should reveal whether the implementation of
sustainability strategies will impact the company’s financial situation.
PM The forecast of the sustainability elements should be included in the
33,5 companies’ financial statement in terms of the risk and the long-term return
of investment because the success of the sustainability concept takes time to
be realised.
The summary of the attributes table is presented in Table I.
464
Results and discussions
The attributes table was used to assess the sustainability property development
concept among listed property companies in Malaysia. Table II presents the score for
each company for all attributes in the sustainability property development attributes.
Table II indicates the score of each listed property company according to each
attribute in the sustainable property development attributes. The results clearly
show that a majority of companies shared equal ranking due to having equal scores
from attributes in the sustainable property development attributes. However, for
those ranked in the top four, the scores for each company differ, thus indicating that
only a few companies are able to fulfil sustainable property development criteria. It
can be observed that some companies obtained the same score and therefore shared
the same ranking.
The results also indicate that there are no listed property companies in Malaysia
capable of achieving a full score according to the attributes. This suggests that there is
still room for improvement for these companies to apply the sustainable property
development concept to their real estate projects.
The results rank the Mah Sing Group in first place, suggesting that the Mah Sing
Group has implemented 15 out of 16 attributes of sustainable property development.
This is followed by Encorp Berhad and the Sunway Group (second and third place)
with only one point separating them. Although the score is only separated by 1 point,
in terms of percentage standpoint, the difference is significant. Even though this
concept is relatively very new in Malaysia, these companies have put some effort to
promote the concept of sustainability in their property projects.
The attributes assessment also revealed that of the 79 listed property companies in
Malaysia, only 12 companies were able to meet more than half of the sustainable
property development attributes in their attributes. This indicates that only 15 per cent
of the listed property companies were seriously committed in implementing sustainable
concepts in their property development projects. Other companies were either still
Sustainable Sustainability in corporate Environmental Special section on sustainability

concept social responsibility issues statement
mentioned statement in organisation
Policy on Sustainability award Green/ Social sustainability
sustainability recognition environmentally
projects
Status of Environmental system audit Conformance with Objectives or targets relating to
environmental programme in organisation environmental priority environmental issues in
management code standards the organisation
Table I. system
Sustainable property Initiatives on Awareness programmes Sustainable Financial report with integrated
development sustainability strategies sustainability information
attributes practices
Ranking Company Point (total/16)
Sustainable
property
1 Mah Sing Group 15 development
2 Encorp Berhad 13
3 Sunway Group 12
4 KLCC Property Holdings 11
5 Country Height Holdings Berhad 10
Dijaya Corporation Berhad 10 465
SP Setia Berhad 10
UEM Land Holdings 10
9 IJM Land 9
Karambunai 9
Ken Holdings 9
12 LBS Bina Group 8
Perduren Berhad 8
14 Guacoland Berhad 7
Nomad Group 7
16 Asas Dunia 6
BCB Berhad 6
Damansara Realty Berhad 6
Hua Yang Berhad 6
20 Glomac Berhad 5
Meda Inc. Berhad 5
Mulpha Land 5
Pasdec Holding Berhad 5
24 Ibraci Berhad 4
Land and General 4
Malaysia Pacific Corporation 4
MKH Berhad 4
Petaling Tin Berhad 4
Symphony Life 4
YTL Land and Development Berhad 4
31 Asian Pacific Holdings Berhad 3
Country View 3
Eastern & Oriental Berhad 3
Malton Berhad 3
MK Land Holdings 3
Nadayu Properties 3
OSK Property Holdings 3
PJ Development Berhad 3
Seal Incorporated Berhad 3
Selangor Properties 3
41 SHL Consolidated 3
South Malaysia Industries 3
43 Crescendo Corporation 2
Dutaland Berhad 2
Gromutual 2
IGB Corporation Berhad 2
Table II.
Ivory Properties 2
Development
Magna Prima 2
attributes score for
Majuperak Holdings 2
listed property
Pan Malaysia Industries 2
companies’
sustainable
(continued ) properties
PM Ranking Company Point (total/16)
33,5
Paramount Corporation 2
Plenitude 2
Selangor Dredging 2
Sentoria Group 2
Tambun Indah Land 2
466 Trinity Group 2
YNH Property 2
58 Bertam Alliance 1
Daiman Development 1
Eupe Corporation 1
Farlim Group 1
KSL Holdings 1
Kumpulan Hartanah Selangor 1
LBI Capital 1
Menang Corporation 1
65 Tahps Group 1
UOA Development 1
Y&G Corporation 1
A&M Realty 1
69 Focal Aims 0
Global Oriental 0
Hunza Properties 0
I-Berhad 0
Keladi Maju 0
MUI Properties 0
Naim Indah 0
Oriental Interest 0
Tanco Holdings 0
Table II. Wing Tai Malaysia 0
working to achieve sustainable targets, lack awareness or were financially constrained.

The results also suggest that listed property companies in Malaysia still fall short of
achieving the full targets of the sustainable property development concept. On average,
most property companies are positioned at rank 24.
The results correlate with the findings from an earlier study by Newell and Manaf
(2008), which determined only three companies as capable of being categorised as a
leader in applying sustainable concepts to their property development projects. This
reflected only 0.1 per cent of the 30 listed property companies used in their study.
Newell and Manaf (2008) used lesser attributes compared to this study, but their
findings also indicated that more effort is required to ensure the success of the
Malaysian Government’s sustainability agenda.
The findings of this study revealed that there are several listed property companies
in Malaysia that have no sustainable elements in their projects, such as Keladi Maju,
MUI Properties, Naim Indah, Oriental Interest, Tanco Holdings and Wing Tai
Malaysia. Note, however, that that these companies are smaller in market value and
have a minor share of the market.
In summary, there are several listed property companies in Malaysia such as Mah
Sing Group, Encorp Berhad, Sunway Group, KLCC Property Holdings, Country
Heights and KLCC property Holdings, which have demonstrated leadership in
sustainability practices through their projects. However, these achievements still fall
below those of international actors in other countries. According to Newell and Manaf Sustainable
(2008), there are several challenges to the promotion of the sustainable concept in property
Malaysia, especially in property development projects. Examples include extending
the sustainability debate further to include both new and older properties, increasing
development
property industry awareness of sustainability and providing financial incentives
(e.g. tax concessions) to encourage property companies to implement effective
sustainability practices. 467
Some of the big companies such as the Mah Sing Group, the Sunway Group, KLCC
Property Holding and SP Setia, scored among the highest for sustainable attributes.
This reflects their efforts to promote sustainable concept to their companies. Hence,
it will also promote environmental awareness in the property industry. The Malaysian
Government introduced several regulations to continue the process of upgrading and
promoting the green concept in several major industries in Malaysia, including the real
estate sector.
Furthermore, REHDA recently launched GreenRE, a green building and carbon-
rating tool to measure building performance in several key areas, such as energy and
water efficiency, environmental protection, indoor quality and carbon emissions.
Several listed property companies pledged to participate in this new initiative,
including Sunway, which scored among the highest attributes in the sustainable
property development attributes. Interestingly, attributes such as “conformance with
environmental code standards” only managed to attract a score from 15 per cent of the
listed property companies, significantly less when compared to “sustainability concept
mentioned” (85 per cent of the listed property companies). This is a contradictory
finding, as listed property companies should disclose in their annual reports, those
projects which comply with the environmental code standards or green building rating
standards, to highlight their sustainable elements.
Table III represents the sustainable property development ranking based on the
score for each attribute. The findings revealed which attributes are the most
implemented by listed property companies in Malaysia for sustainability concept.
As mentioned above, these attributes provide an overview of factors that are
Ranking Attributes Score
1 Sustainability concept mentioned 66

2 Sustainability in corporate social responsibility statement in organisation 53
3 Initiatives on sustainability practice 30
4 Social sustainability 27
5 Awareness programmes 25
6 Green/environmentally projects 22
7 Conformance with environmental codes on standards 19
8 Policy on sustainability 14
9 Sustainability award recognition 13
10 Sustainability strategies 13
11 Environmental issues statement 12
12 Status of environmental management system 9
13 Objectives or target relating to priority environmental issues in organisation 9 Table III.
14 Special section on sustainability 6 Sustainable property
15 Environmental system audit programme in organisation 2 development
16 Financial report with integrated sustainability information 1 attributes ranking
PM believed to be the sustainable indicator for listed property companies in Malaysia.
33,5 Obviously, there will be some other relevant elements that need to be considered,
but the attributes used in this study are identified as pillars, based on various
literature reviews.
The results revealed only three attributes (“sustainability concept mentioned”,
“sustainability in corporate social responsibility statement” and “initiatives on
468 sustainability practices”) managed to achieve a score that exceeded half of the total
score. This suggests that the majority of listed property companies in Malaysia are
only able to implement, on average, three major attributes in the sustainable property
development attributes. As such, this signifies the lack of recognition of the
sustainability concept among listed property companies in their projects, as well as in

their organisations. Furthermore, none of the attributes of listed property companies in
Malaysia obtained a score of 100 per cent.
In addition, four attributes, namely “status of environmental management system”,
“objectives or targets relating to priority environmental issues”, “special section on
sustainability”, “environmental system audit program” and “financial report with
integrated sustainability information” were implemented for property development
projects in less than ten companies, representing only 0.13 per cent of the total listed
property companies in Malaysia.
Overall, the sustainability concept in property development by listed property
companies were widely promoted throughout several mediums, such as mentioning
“sustainability concept” in projects, as well as through CSR statements. Attributes such
as EMS in the company, special sections on sustainability, environmental audit
programme and financial report with sustainability elements attracted the least
attention from the listed property companies. These attributes are believed to represent
the most advanced stage in the sustainability concept in real estate; therefore, the
results suggest the level of sustainability awareness among listed property companies
is still quite low.
Table IV, demonstrates analysis based on the weighted average with which each
attribute is to be averaged are assigned a weight. The weightage is based on the attributes
that indicate the commitment and implementation by the property companies. Weightage
1 indicates the higher commitment and implementation by property companies to
sustainability concept in property development projects. In addition, it is also shows
advanced concept in sustainability attributes. This is followed by Weightage 2 which
shows moderate level in terms of sustainability concept implementation. And Weightage
3 indicates the basic aspect in sustainability by the property companies in order to
promote sustainability concept in real estate projects.
The results have showed that Weightage 2 manage to score the highest Weighted
average (13.01 per cent). This is followed by Weightage 1 (11.39 per cent) and
Weightage 3 (1.39 per cent). The results signify the moderate commitment by the
property companies in Malaysia towards the implementation of sustainability concept
in property development projects. This has showed that the sustainability attributes
such as sustainability concept mentioned, sustainability in CSR, environmental issues
statement and special section on sustainability have been highly implemented among
property companies in Malaysia. Nevertheless, attributes which will show the high
commitment by the property companies in Malaysia are not being implemented widely.
This indicates there are still lots of effort needed in order for Malaysia to be a champion
in sustainability issues. Weightage 3 attributes, which is mostly based on the written
documents have only scored the lowest weightage average. As such, this indicates that
No. Attributes Score % Weight (%)
Sustainable
property
1 Initiatives on sustainability practices 30 38 50 development
Social sustainability 27 34
Awareness programmes 25 32
Green/environmentally projects 22 28
Conformance with environmental codes on standards 19 24
Environmental system audit programme 2 3 469
Financial report with integrated sustainability information 1 1
Average score 23
Weighted average 11.39
2 Sustainability concept mentioned 66 84 30

Sustainability in corporate social responsibility 53 67
Environmental issues statement 12 15
Special section on sustainability 6 8
Average score 43
Weighted average 13.01
3 Policy in sustainability 14 18 10
Sustainability awards 13 16
Sustainability strategies 13 16
Objectives or target relating to priority environmental issues 9 11
Special section on sustainability 6 8 Table IV.
Average score 14 Weightage average
Weighted average 1.39 score attributes
the majority of property companies in Malaysia, have not only submitted an official
documentation to promote the sustainability concept but are also trying very hard to
put it into reality. This can be seen from the score results of Weightages 1 and 2.
Figure 1, represents the relationship between all listed property companies in the
Malaysian index based on the market value as at 30 June 2013, and the sustainability
index ranking based on the analysis illustrated in the previous section (see Table IV).
The test is to analyse whether high-value companies also have a high level of
sustainability index. Using “Spearman’s coefficient” of rank correlation between the
Company
90
80
70
60
50
Score
40
30 Figure 1.
20
The sustainability
attributes ranking
10 and companies’
market value
0 ranking rank
0 20 40 60 80 100
correlation
Score
PM two indexes, Rs ¼ 0.148 thus indicates that the sustainability index and ranking of
33,5 listed property companies in Malaysia based on market value is not significantly
correlated. The fact that the top companies in terms of market value must have a high
level of sustainability in the property development projects is not necessarily true.
Figure 1 shows a weak relationship between the sustainability index and the
top-listed property companies based on the market value in Malaysia. This figure
470 highlights an important finding; it highlights the fact that although most of the
companies in Malaysia are satisfactory in terms of sustainability attributes, the top
property companies (based on market value) may not necessarily have a good
sustainability level. Some top-listed property companies do however, also score high
in sustainability index, including the Mah Sing Group, the Sunway Group, KLCC
Property Holdings, SP Setia Berhad and UEM Holdings. The findings also indicate
that small listed property companies (such as Encorp Berhad, Country Heights,
Dijaya Corporation and Karambunai) also try to promote the sustainability concept in
their property development projects.
The findings on the correlation above are expected to have a significant impact on
real estate activities, serving as “investor magnets” for Malaysia which would create a
sustainable investment climate and drive an injection of funds to boost and strengthen
its global position (Razali and Adnan, 2012).
In comparison, the top property company rankings and sustainability indexes,
not only differ in the companies’ investment and marketing strategies, but also in
terms of management decision strategies. An assessment of these benchmarks will
provide an overview of the differences between the sustainability benchmark and
property companies’ performances. This also highlights the importance of other
factors in explaining the sustainability ranking of top-listed property companies
in Malaysia.
Property implications – the way forward

The findings have shown that the implementation of sustainable property development
concept among property companies in Malaysia is currently at a moderate level. This is
proven by the analysis of weightage average on sustainability attributes which scored
moderately at 13.01 per cent. This indicates that the sustainability concept awareness
is there, however, more efforts are needed to increase the level of satisfaction in terms of
its implementation. As mentioned in previous section, the concept of sustainability is
very important, as real estate is the biggest contributor to our environmental problems.
The drivers that will act as a catalyst to promote sustainability concept in property
development, is its long-term cost saving through sustainability activities such as
energy saving programme and water recycle and saving mechanism. In addition,
by implementing sustainability concept in property development, it will also uncover
potential image benefits which consequently will increase the sales and profit margin.
Recent study by Fuerst and McAllister (2008), found that there is a significant positive
influence to rent levels from the implementation of sustainable concept in property.
Moreover, the level of awareness of sustainability or green concept has publicly been
increasing significantly. This can be seen with many programmes related to
environmental awareness organised by the public as well as by the non-government
organisation. The concept of sustainability in property development will also increase the
value of the property; contributed by several valuation attributes such as rental, operating
costs and risks. Nevertheless, social responsibility is the main driving force towards
implementing the concept of sustainability in property development. As development in
Malaysia increases rapidly due to the need for physical space and buildings, more Sustainable
property development projects will emerge. Hence, the responsibility towards the property
environment and ethical moral of developers need to be the major drivers in promoting
sustainability programme in real estate development.
development
Conclusions
This paper investigates the sustainability practices among property companies in 471
Malaysia. All 79 property companies were included in this study to examine the level
of sustainability in their property development projects. The sustainability level was
examined by using a sustainability property development attributes. The attributes
encompasses several attributes that were designed based on several literature surveys
and similar previous research, as tools to investigate the level of sustainability. This
sustainability index was then compared to the ranking of property companies, based
on market value. Overall, it was found that the sustainability level among property
companies in Malaysia is at a satisfactory level and is poised to experience rapid
changes. Several property development projects in Malaysia have been identified as
green or sustainability projects. These projects were launched by property companies
either to participate in the Malaysian Government’s sustainability campaign, or as part
of their broader marketing strategies to attract buyers.
With an average of 26 per cent of property companies displaying sustainability
attributes, it can be concluded that only a few property companies have widely
implemented sustainability elements. The awareness of sustainability among property
companies can be categorised as at a moderate level, although this is increasing.
This can be seen from the several projects that attempted to apply sustainability
elements. This corresponds with the Government policy in sustainability programmes.
Big companies such as SP Setia, Sunway, KLCC Properties and IJM Land reflect their
image as big companies from the sustainability point of view. Furthermore, from the
weightage average analysis, the results also showed that property companies in
Malaysia are at the middle stage of sustainability implementation level. In other
words, property companies in Malaysia have put their effort to promote the concept
of sustainability, although there is still room for improvement to ensure the success
of the concept.
This paper also investigates the definition of sustainability, especially for the
bigger companies in terms of market value. As such, top property companies ranked
by market value and those ranked highly in the sustainability property development
index were also tested to analyse the rank correlation between these two indexes.
This study showed that there is no correlation between the top property companies
based on market value and the sustainability property development index.
This indicates that the top property companies in Malaysia have not necessarily
made enough effort to promote the sustainability concept in their projects. In turn,
this lack of promotion also takes away from any efforts to highlight their overall
company sustainability policy.
The findings on rank correlation analysis contradicts that of Khadaroo (2005)
which mentioned that establishing a website is influenced by several factors such as,
company size and expected number of users. Interestingly, some small companies
in terms of market value have scored highly for sustainability attributes.
All stakeholders need to play their role to ensure the success of the sustainability
development agenda. Sustainability agenda for big companies not only imply that
they play an active role, but they must also involve all their stakeholders. As the
PM concept of sustainability becomes more popular and accepted, managers will need to
33,5 be more aware of the benefits of the concept and to investigate how they can better
integrate the concept into the company’s system and process. Organisational factors,
commitment of stakeholders and government’s legislation are the key driving force
behind the implementation of sustainable concept by property companies; the findings
from the study indicated this.
472 This study has exposed the wider perspective of sustainability issues among
property companies in Malaysia. In Malaysia, the issue of sustainability has only been
taken seriously at the government level. Although private companies including
property companies have slowly taken the concept of sustainability into consideration,
the action plan and execution still require serious attention from these companies.
Certainly property companies were sceptical in relation to the potential profit and cost
to implement sustainability concept. Yet, the long-term return of investment from the
sustainability and profit point of view also plays an important role. During the
literature review, the attributes have been modelled into the sustainability attributes
for property companies to assess the level of the implementation of sustainability
concept in property development projects by property companies in Malaysia. Very
few literature findings, focused on a case study in Malaysia. Therefore, this study gives
a better understanding on the status of the implementation of sustainability concept in
Malaysia. This is especially so in the property sector which is the major contributor to
Malaysia’s economic growth. Since the sustainability issue is a global issue, focusing
on the various countries’ implementation of the sustainability concept is essential.
However, there are also some limitations of this empirical research on the sustainable
concept which focuses on the wider range of sustainability concept. Although Newell
and Manaf (2008) have studied this issue in Malaysia, their concept of sustainability is
limited since their focus had only been on a few property companies. Therefore, this
study will expose the wider perspective on the sustainability issues, especially among
the property companies in Malaysia. The government in particular, will greatly benefit
from the findings of this research as it will be able to enforce the strategic sustainability
implementation policy to address the sustainability issues in the real estate sector.
In addition, this research can best describe the property players in Malaysia, in particular,
property companies as “emerging” in championing the concept of sustainability in the
real estate sector.
Future research
Future research could be emphasising on several sustainability issues, such as,
corporate responsibility, sustainable performance assessment, carbon disclosure and
financial performance from implementing the sustainability concept.
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(The Appendix follows overleaf.)

PM Appendix
33,5
No. Companies
1 A&M Realty Berhad

476 2 Asas Dunia
3 Asian Pacific Holdings Berhad
4 BCB Berhad
5 Bertam Alliance
6 Country Height Holdings Berhad
7 Country View
8 Crescendo Corporation Berhad
9 Daiman Development Berhad
10 Damansara Realty Berhad
11 Dijaya Corporation Berhad
12 Dutaland Berhad
13 Eastern & Oriental Berhad
14 Encorp Berhad
15 Eupe Corporation Berhad
16 Farlim Group (Malaysia) Berhad
17 Focal Aims Holdings Berhad
18 Mah Sing Group
19 Global Oriental Berhad
20 Glomac Berhad
21 Gromutual
22 GuacoLand (Malaysia) Berhad
23 Hua Yang Berhad
24 Hunza Properties Berhad
25 I-Berhad
26 Ibraco Berhad
27 IGB Corporation Berhad
28 IJM Land
29 Ivory Properties Group Berhad
30 Karambunai
31 Keladi Maju
32 Ken Holdings
33 KLCC Property Holdings
34 KSL Holdings
35 Kumpulan Hartanah Selangor
36 Land and General
37 LBI Capital Berhad
38 LBS Bina Group Sdn Bhd
39 Magna Prima Berhad
40 Majuperak Holdings
41 Malaysia Pasific Corporation Berhad
42 Malton Berhad
43 Meda Inc. Berhad
44 Menang Corporation (M) Berhad
45 MK Land Holdings Berhad
46 MKH Berhad
Table AI.
47 MUI Properties Berhad
List of listed
property companies
in Malaysia (continued )
No. Companies
Sustainable
property
48 Mulpha Land
49 Nadayu Properties Berhad
development
50 Naim Indah Corporation Berhad
51 Nomad Group
52 Oriental Interest Berhad
53 OSK Property Holdings 477
54 Pan Malaysian Industries Berhad
55 Paramount Corporation Berhad
56 Pasdec Holdings Berhad
57 Perduren (M) Berhad

58 Petaling Tin Berhad
59 PJ Development Holdings
60 Plenitude Berhad
61 Seal Incorporated Berhad
62 Selangor Dredging Berhad
63 Selangor Properties Berhad
64 Sentoria Group
65 SHL Consolidated
66 South Malaysia Industries Berhad
67 SP Setia Berhad Group
68 Sunway Group
69 Symphony Life
70 Tahps Group
71 Tambun Indah Land
72 Tanco Holdings
73 Trinity Group Sdn Bhd
74 Uem Land Holdings
75 UOA Development
76 Wing Tai Malaysia Berhad
77 Y&G Corporation Berhad
78 YNH Property Berhad
79 YTL Land and Development Berhad Table AI.
Corresponding author
Dr Muhammad Najib Razali can be contacted at: mnajibmr@utm.my
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Sustainable property development by Malaysian property companies

Article in Property Management · October 2015

Muhammad Najib Razali Yasmin Mohd Adnan

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Sustainable property Sustainable

Yasmin Mohd Adnan

governance (reflected through their acknowledgment of sustainable concept initiatives

Sustainable property development

Sustainability property development in Malaysia

techniques that are workable in the industry.

(1) Government support: the Government of Malaysia must continuously promote

actors of property development in Malaysia, the analysis among these companies

Sustainable property development attributes

companies in Malaysia, several elements described by other researchers have also

examine the advanced elements in sustainability; these attributes are considered as an

The social elements in sustainability will contribute towards a sustainability

Sustainable Sustainability in corporate Environmental Special section on sustainability

working to achieve sustainable targets, lack awareness or were financially constrained.

Ranking Attributes Score

1 Sustainability concept mentioned 66

sustainability concept among listed property companies in their projects, as well as in

2 Sustainability concept mentioned 66 84 30

Property implications – the way forward

Journal of Environmental Economics and Management, Vol. 62 No. 2, pp. 1-14.

Membaru, D. (1998), “Sustainability and sustainable development: historical and conceptual

(The Appendix follows overleaf.)

1 A&M Realty Berhad

57 Perduren (M) Berhad

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