E-Waste, CSR and Circularity in Malaysia's Compliance-Driven Era

ESG reporting is becoming more stringent in Malaysia, yet e-waste remains an undefined area.

Here we explore why circular IT strategies, Scope 3 reporting, and certified IT asset disposition must become ESG priorities for organisations and hyperscalers in Malaysia.

The Rise of a Real Risk

Sustainability reporting in Malaysia has entered a new chapter.

With Bursa Malaysia mandating IFRS-aligned sustainability disclosures beginning in 2025 for Main Market issuers and in 2026 for ACE Market companies, the shift from voluntary to enforceable ESG strategy is well underway.

These developments mirror global investor expectations and signal to international players, especially hyperscalers entering the APAC region, that Malaysia is serious about climate accountability and ESG performance.

But amid the rush to baseline Scope 1 and 2 emissions, embed TCFD principles, and produce auditable climate disclosures, a silent gap remains:

E-waste is the ESG blindspot Malaysia cannot afford to overlook.

From decommissioned servers and laptops to untracked hard drives, the environmental, governance, and social risks of unmanaged IT asset disposal remain largely invisible in most ESG reports. Yet this is where hidden emissions, data risk, and social opportunity intersect.

Malaysia's Evolving ESG Landscape

The past 18 months have seen landmark moves from regulatory and market actors. Here are some strong foundations and strategic gaps in Malaysia’s evolving ESG landscape:

Bursa Malaysia and Securities Commission (SC) Mandates

  1. IFRS S1 & S2 adoption begins for Main Market companies by financial-year-end (FYE) 2025 and 2026 for ACE Market companies.
  2. TCFD alignment required for an organisation’s climate governance, scenario analysis, and sustainability strategy.
  3. The National Sustainability Reporting Framework (NSRF) clarifies director duties and materiality thresholds.
  4. CSI Platform launched as a digital system for carbon tracking and future Scope 3 disclosures.

A. International Financial Reporting Standards (IFRS)

With Bursa Malaysia’s 2024 mandate for IFRS-aligned sustainability reporting using IFRS S1 and S2, companies now face real regulatory expectations and not mere voluntary best practices. For context,

IFRS S1 refers to the General Requirements for Disclosure of Sustainability-related Financial Information;

IFRS S2 refers to Climate-related Disclosures.

B. Task Force on Climate-Related Financial Disclosures (TCFD)

Designed to elevate disclosure quality and align with global standards, the Enhanced Sustainability Framework mandated by Bursa Malaysia requires all listed companies to adopt climate-related reporting based on the Task Force on Climate-related Financial Disclosures (TCFD) recommendations by FYE 2025 (Main Market) and 2026 (ACE Market). The TCFD will offer investors insights into companies’ climate change mitigation efforts and their governance transparency. 

“The TCFD’s focus is reporting on the impact an organisation has on the global climate.” — Deloitte

C. National Sustainability Reporting Framework (NSRF)

To improve Malaysia’s competitiveness and appeal to investors, the NSRF aims to ensure that Malaysian corporations provide sustainability information that is consistent, comparable, and reliable. The Securities Commission’s National Sustainability Reporting Framework (NSRF) further reinforces this shift with a clear expectation.

You can view the NSRF infographic provided by the SC here.

D. Centralised Sustainability Intelligence (CSI)

The Centralised Sustainability Intelligence (CSI) Solution empowers Malaysian businesses to improve supply chain sustainability. This platform simplifies ESG data management, reporting, and integration into supply chains, facilitating compliance with ESG disclosure requirements.

Corporations are encouraged to utilise this service, which provides automated TCFD-aligned climate reporting, ESG reporting, and Scope 3 insights. Additionally, it connects companies and their SME supply chains with financial incentives through partnerships with financial institutions.

Yet in all these frameworks, IT asset lifecycle, e-waste traceability or circular digital infrastructure is rarely mentioned explicitly.

This essential component of operational sustainability could be at risk of being omitted entirely from corporate governance disclosures despite its direct and indirect link to multiple ESG categories.

However, it is in the best interest and long-term gain for companies to proactively include them in their ESG efforts.

E-Waste: An ESG Imperative Across All 3 Pillars

Prioritising IT asset disposition isn’t just a minor consideration; it’s a critical one. Here are the potential risks for each pillar:

Environmental Risk

As of 2024, Malaysia’s recycling rate stands at 35% which is below the 40% target for 2025 as set out in the 12th Malaysia Plan (2021-2025).

A majority of end-of-life electronics are improperly disposed of, often ending up in landfills, with unregistered recyclers, or on the black market.

This is highly concerning because the toxic substances released through methods like open burning or discarding in open waters can expose surrounding communities to health problems and threaten our ecosystem.

Governance and Data Risk

Devices that leave your facility without certified data erasure or destruction expose your organisation to compliance failures under PDPA and GDPR. Although it is applicable to all industries, conducting proper data and hardware disposals are especially critical for:

  • Financial institutions
  • Public sector entities
  • Data-driven hyperscalers with strict global audit standards

SPW provides certified and secure data erasure and destruction solutions, suitable for businesses of all operational scales.

Read more here.

Social Responsibility

Outdated but functional IT assets can be refurbished and distributed to B40 schools, community centres, and NGOs supporting digital access. Yet this potential is largely untapped by ESG strategies in Malaysia, even as digital inclusion remains a national goal.

We can advise you on how to incorporate IT Asset Donation and Deployment or IT Asset Remarketing into your ESG strategy.

Read more here.

Scope 3 Emissions: The Carbon Cost Report

Most ESG reports focus on:

  • Scope 1: Emissions from company-owned assets.
  • Scope 2: Purchased electricity and energy.

But the largest, and least controlled, category is Scope 3, which includes:

  • Logistics
  • Supply chains
  • Product use
  • End-of-life disposal

In ICT-driven sectors, Scope 3 can account for over 70% of a company’s total emissions. IT asset disposition, warehousing, and decommissioning are critical contributors but few organisations have included them in their process or reporting.

If you can’t track where your retired devices go, you can’t validate your sustainability claims.

You can start measuring by taking your inventory into account.

Learn more here.

Digital Circularity: The Strategy That Closes The Loop

Selangor has initiated early conversations on a state-level circular economy policy, but Malaysia has yet to implement a federal framework linking e-waste recovery with ESG mandates.

Forward-thinking companies, especially those seeking ESG-linked financing or global procurement access, must fill the gap by implementing circular IT asset strategies now.

For Malaysian Government Agencies, GLCs, and Corporates:

  • Make e-waste traceability a board-level issue under TCFD-aligned governance
  • Establish annual ESG KPIs for IT asset reuse, donation, or destruction
  • Ensure vendors and asset leasing companies comply with the latest regulations
  • Tap into ESG and CSR alignment frameworks to support both reporting and impact

For Hyperscalers in APAC:

  • Evaluate downstream emissions and disposal partners as part of ESG due diligence
  • Ensure all devices are processed with full audit trail and compliant data erasure
  • Incorporate ESG-aligned circularity into your procurement frameworks

For SMEs and Mid-Sized Firms:

  • Partner with circular service providers to cut costs and increase ESG visibility
  • Communicate your ITAD efforts in ESG statements or RFP documents
  • Use refurbished devices responsibly and document outcomes

How To Get Started: The ESG Stages Circularity Checklist

Stage 1: Assessment

Conduct an IT Asset Audit. Take inventory of your device usage, age, and risk.

Why? This is an important step for governance and reporting.

Stage 2: Certified Disposal

Define your data security standard. Choose NIST 800-88 and IEEE 2883 level data-wiping and destruction for your peace of mind.

Why? Secure data sanitisation means you meet legal compliance for data security.

Stage 3: Disposition and Redeployment

Identify dispositioned assets for redeployment, remarketing, or donation. Reassign your devices internally, choose resale or donate to NGOs.

Why? You can fulfill your ESG Social Impact category and reduce Scope 3 emissions.

Stage 4: Secure Governance

Use only certified ITAD providers with destruction reports, tracking, and vetted downstream management.

Why? This ensures your governance remains in compliance with regulations.

Stage 5: Impact Reporting

Publish your IT asset recovery, reuse and related metrics.

Why? This offers ESG assurance to your investors.

If ESG is your goal, IT Lifecycle Management may be the missing link.

Malaysia is taking bold steps toward ESG compliance. However, true compliance without circularity is fragile and ESG without IT lifecycle accountability is incomplete. Companies should prepare now for any regulatory changes.

E-waste is not a technical afterthought. It’s an ESG frontier.

To Malaysian business leaders:
e-waste is your opportunity to lead in Scope 3, CSR, and digital access.

To global hyperscalers:
Your partners’ disposal practices are part of your value chain.

To policymakers:
Circular IT should be central to the national climate and digital economy agenda.

We’re here to help you close the loop—with strategy, compliance, and clarity.

If you’re ready to integrate circularity and compliance into your ESG strategy, reach out for a consultation with our team.

We Have Your Back

Our secure IT asset disposal services provides the dependable solution you need for your e-waste and end-of-life asset needs. Our team applies safe and sustainable steps that are regulatory-compliant at every stage of the process.

From the point of collection, auditing, shredding and/or wiping to remarketing and/or donating your IT assets, you can be sure with our end-to-end services that we take your security seriously.

We have coverage against the loss of or damage to your goods during transportation. This includes marine cargo shipment from the ports to the warehouses

Our professional team of asset removers ensure your devices are packed safely into our vehicles which are also equipped with GPS-tracking systems. We have armed our warehouses with fingerprint-only access complete with security alarms and 24/7 CCTVs in place

Our reach spans across the globe through our networks of partners and vendors. Wherever your business is based, you can leverage our worldwide network and we would be happy to assist you throughout your ITAD journey