Environmental Capabilities Indicators are Prominent for Organizational Competitiveness and Performance. An Empirical Study of Malaysian Manufacturing Industry

It is no doubt, an awareness of environmental responsibility is currently taking place. Locally, Bursa Malaysia has unveiled Environmental, Social and Governance (ESG) Index in 2014 for public listed companies (Berhad)aiming to boost sustainability practices. Internationally, two of the world largest companies; Apple Incorporation – the most valuable companies in the world and Wal-Mart Incorporation – the world largest company in term of revenue are actively engaging with sustainable practices (Deloitte CFO Insights, 2009). As such, a company's superb performance is no longer constrained on economic expects but has extended to environmental and social matters which named as sustainable performance. Yet, the practice of sustainability in developing nations such as Malaysia is relatively extreme low especially manufacturing companies in Malaysia. Essentially theExcel of Malaysian manufacturing depends on the scrutinization from developed counterparts in term environmental compliance. Aiming to encourage sustainable practices among manufacturing companies, particularly environmental area; thestudy will develop environmental capabilities indicators aiming to lead higher organization performance with ultimately boost up the sustainability practice. The technique of Amos 18 is applied in this study. Essentially, this study has successfully revealed comprehensive environmental capabilities indicators. In a nutshell, an organization with strong performance definitely possess appropriate indicators of environmental capabilities indicators. As such, regulatory bodies like The Electrical and Electronics Association of Malaysia (TEEAM) and The Federation of Malaysian Manufacturers (FMM), Malaysia Institute of Accountant (MIA), must lead and be proactive in promoting sustainable practices among Malaysian manufacturing companies. They can unlock the study finding in drafting their policies and encourage companies to implement it.