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KUALA LUMPUR: Malaysian companies that proactively align with European Union (EU) regulations can tap into new opportunities and strengthen their position as preferred partners for European businesses.
Dr Harald Sippel, executive director of ESG Malaysia, an environmental, social, and governance consultancy, highlighted the need for expert guidance to ensure compliance with EU standards and sustain robust business relationships with European counterparts.
He outlined key strategies for achieving compliance, such as developing a thorough understanding of regulatory requirements, performing detailed supply chain audits, and collaborating with local stakeholders through professional support.
"Malaysian companies are mostly completely unclear as to what requirements they must meet. The first step to becoming a preferred supplier of products to markets—including the European markets—is to become fully aware of the applicable requirements.
"If at least one employee in a company undergoes the training by a qualified professional, that employee can greatly reduce the need to rely on external consultants to achieve compliance," he said in CME's Monthly Espresso report.
Harald emphasised the importance of conducting thorough supply chain audits to identify high-risk areas and ensure compliance with EU regulations.
"This includes assessing risks related to deforestation, forced labour, and other human rights violations, as well as providing actionable recommendations to address gaps," he added.
He stated that adhering to European standards often means full respect for indigenous rights.
"This is an area that is very often overlooked in Malaysia. Experts can mediate dialogues, draft agreements, and guide businesses in adopting best practices for sustainable and ethical operations in this area as well," Harald said.
He said European laws like the EU Deforestation Regulation (EUDR), the Corporate Sustainability Due Diligence Directive (CSDDD), and the Forced Labour Regulation mark a new era of trade governance, where compliance with sustainability and ethical standards is no longer optional.
"For Malaysian companies, this is a call to action. Meeting these requirements is not about adhering to foreign laws but about staying competitive in an evolving global market," he adds.
Harald stated that by viewing compliance as an opportunity rather than a burden, Malaysian businesses can strengthen ties with European partners and establish themselves as leaders in sustainable and ethical trade.
Source: https://www.nst.com.my/business/corporate/2025/02/1173450/malaysian-firms-urged-adapt-eu-laws-stay-competitive