By Iva Karen
KUALA LUMPUR, June 30: In today’s investment landscape, it is no longer enough for companies to deliver strong financial returns, as investors increasingly want to know how their businesses impact the environment, how they treat their workers, and govern themselves.
This is where Environmental, Social, and Governance (ESG) factors, that reflect a company’s ties to sustainability and ethical responsibilities, come into play, becoming a core part of responsible investing as well, says Muhamad Nazri Shaidon, who has years of expertise in countering money laundering and terrorism financing.
Muhamad Nazri said this is where investors can apply the ESG triangulation method that involves the gathering of information from three key areas, namely what the company says, what independent sources say, and what’s happening on the ground, to get a fuller, more accurate view of ESG risks and performance of the company.
He explained that the first layer will be internal information from the company itself, including sustainability reports, company policies, internal audits, and interviews with management.
“While these give insight into the company’s ESG commitments, they often need to be verified against other sources. That’s where the second layer comes in — external validation.
“This includes data from non-governmental organisations (NGOs), investigative journalists, ESG rating agencies, regulatory records, and even public feedback from social media. Third-party data allows investors to detect ESG blind spots that internal reports might ignore or hide,” he said.
He added that the third and most crucial pillar is the local context, which involves gathering insights from people living and working near the company’s operations, such as local communities, workers, or environmental groups.
“These stakeholders often have firsthand knowledge of issues like land rights disputes, unsafe working conditions, or pollution, offering a reality check against corporate narratives.
“By using all three sources, ESG triangulation enables investors to make more informed decisions. It helps separate real progress from greenwashing and strengthens investor confidence by reducing exposure to hidden risks,” he said.
As Malaysia strengthens its position as a regional ESG hub, Nazri believes this smarter, triangulated approach will become essential for both local and international investors.
Beyond being a strategic advantage, ESG triangulation supports greater transparency, ethical growth, and long-term resilience in a rapidly evolving global economy.
–WE