Sustainability certifications and financial profitability : an analysis on palm oil companies in Malaysia
As the second largest palm oil producer in the world, Malaysian palm oil industry has contributed significantly to the national GDP. However, this industry has been under criticism for serious deforestation and open burning activities, which obviously opposing to the objective of the oil palm Go...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
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Penerbit Universiti Kebangsaan Malaysia
2018
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| Online Access: | http://journalarticle.ukm.my/20488/ http://journalarticle.ukm.my/20488/1/30080-102237-1-PB.pdf |
| _version_ | 1848815116047351808 |
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| author | Hafizuddin-Syah B.A.M, S. Shahida, Siti Hanisah Fuad, |
| author_facet | Hafizuddin-Syah B.A.M, S. Shahida, Siti Hanisah Fuad, |
| author_sort | Hafizuddin-Syah B.A.M, |
| building | UKM Institutional Repository |
| collection | Online Access |
| description | As the second largest palm oil producer in the world, Malaysian palm oil industry has contributed significantly to the
national GDP. However, this industry has been under criticism for serious deforestation and open burning activities,
which obviously opposing to the objective of the oil palm Good Agricultural Practice on zero burning. As a result,
sustainability certification of Roundtable Sustainable Palm Oil and Malaysia Sustainable Palm Oil had been introduced
towards achieving sustainable development governance in this industry and fulfilling the needs of importing countries on
certified palm oil. However, the number of companies with sustainability certification is relatively low due to the concern
on potential additional cost, which then could affect firm profitability. Therefore, this study aims to examine the impact
of sustainability certification on financial profitability among 39 palm oil companies in Bursa Malaysia, from 2009 to
2016. Based on the GLS estimation model, the finding shows that the profitability of firms with sustainability certification
is almost 2% higher than firms without certification. The finding of this study provide useful input for industry players and
could encourage palm oil companies to subscribe sustainability certifications to improve their sustainability practices
and good governance as well as increase their profits. |
| first_indexed | 2025-11-15T00:44:51Z |
| format | Article |
| id | oai:generic.eprints.org:20488 |
| institution | Universiti Kebangasaan Malaysia |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-15T00:44:51Z |
| publishDate | 2018 |
| publisher | Penerbit Universiti Kebangsaan Malaysia |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | oai:generic.eprints.org:204882022-11-11T09:05:11Z http://journalarticle.ukm.my/20488/ Sustainability certifications and financial profitability : an analysis on palm oil companies in Malaysia Hafizuddin-Syah B.A.M, S. Shahida, Siti Hanisah Fuad, As the second largest palm oil producer in the world, Malaysian palm oil industry has contributed significantly to the national GDP. However, this industry has been under criticism for serious deforestation and open burning activities, which obviously opposing to the objective of the oil palm Good Agricultural Practice on zero burning. As a result, sustainability certification of Roundtable Sustainable Palm Oil and Malaysia Sustainable Palm Oil had been introduced towards achieving sustainable development governance in this industry and fulfilling the needs of importing countries on certified palm oil. However, the number of companies with sustainability certification is relatively low due to the concern on potential additional cost, which then could affect firm profitability. Therefore, this study aims to examine the impact of sustainability certification on financial profitability among 39 palm oil companies in Bursa Malaysia, from 2009 to 2016. Based on the GLS estimation model, the finding shows that the profitability of firms with sustainability certification is almost 2% higher than firms without certification. The finding of this study provide useful input for industry players and could encourage palm oil companies to subscribe sustainability certifications to improve their sustainability practices and good governance as well as increase their profits. Penerbit Universiti Kebangsaan Malaysia 2018 Article PeerReviewed application/pdf en http://journalarticle.ukm.my/20488/1/30080-102237-1-PB.pdf Hafizuddin-Syah B.A.M, and S. Shahida, and Siti Hanisah Fuad, (2018) Sustainability certifications and financial profitability : an analysis on palm oil companies in Malaysia. Jurnal Pengurusan, 54 . pp. 143-154. ISSN 0127-2713 https://ejournal.ukm.my/pengurusan/issue/view/1154 |
| spellingShingle | Hafizuddin-Syah B.A.M, S. Shahida, Siti Hanisah Fuad, Sustainability certifications and financial profitability : an analysis on palm oil companies in Malaysia |
| title | Sustainability certifications and financial profitability : an analysis on palm oil companies in Malaysia |
| title_full | Sustainability certifications and financial profitability : an analysis on palm oil companies in Malaysia |
| title_fullStr | Sustainability certifications and financial profitability : an analysis on palm oil companies in Malaysia |
| title_full_unstemmed | Sustainability certifications and financial profitability : an analysis on palm oil companies in Malaysia |
| title_short | Sustainability certifications and financial profitability : an analysis on palm oil companies in Malaysia |
| title_sort | sustainability certifications and financial profitability : an analysis on palm oil companies in malaysia |
| url | http://journalarticle.ukm.my/20488/ http://journalarticle.ukm.my/20488/ http://journalarticle.ukm.my/20488/1/30080-102237-1-PB.pdf |