MALAYSIA UNVEILS FCC ON GLOBAL STAGE: A STEP TOWARDS ARTICLE 6.8 PARIS AGREEMENT RECOGNITION

KUALA LUMPUR, May 6 (Bernama) --  Malaysia reached a significant milestone in forest conservation by introducing the Forest Conservation Certificate (FCC) protocol to the global community through its participation in the ongoing ESG Xchange 2025 in Hong Kong.

This initiative seeks to promote the FCC as an internationally recognised forest conservation instrument, bringing Malaysia closer to becoming the second country to be acknowledged under Article 6.8 of the Paris Agreement, following Costa Rica.

Delivering a keynote speech before more than 1,000 delegates during the opening session of ESG Xchange 2025, Malaysia Forest Fund (MFF) chief executive officer Datuk Mohamed Shah Redza Hussain announced that 80 sites across the country have been identified as conservation locations, with 16 sites fully assessed for FCC projects.

bootstrap slideshow

At the conference, Malaysia also urged international environmental, social, and governance (ESG) investors to support forest conservation through the Malaysian FCC protocol, which has been developed as a verified instrument with independent monitoring, reporting, and third-party verification.

This, Shah Redza noted, enables corporations and governments to invest in conservation efforts outside marketbased mechanisms, positioning FCC as a certified conservation financing model that aligns with ESG criteria.

“Malaysia’s objective in participating in ESG Xchange 2025 is to attract ESG-driven international investors to support forest conservation through our FCC framework.

“Unlike carbon credit trading mechanisms, FCC allows businesses and governments to invest directly in conservation projects, making it a financing model that adheres to ESG compliance while contributing to global sustainability goals,” he said.

Shah Redza said MFF’s participation in the conference aligns with its responsibility as Malaysia’s National Focal Point for Article 6.8 of the Paris Agreement, a mandate officially granted in February 2025, tasked with facilitating conservation financing and advancing sustainable environmental initiatives according to international standards.

“At the same time, we are leveraging this opportunity to promote the Malaysian FCC protocol for international recognition. Article 6.8 of the Paris Agreement requires at least one other country to adopt our FCC protocol as their official conservation standard.

“This is one of our key missions in Hong Kong, with the hope that our instrument will be accepted as a viable conservation model within ESG systems,” he said.

Shah Redza further emphasised that recognition under Article 6.8 would allow Malaysia to receive international financing for forest conservation projects, the benefits of which are substantial, as international funding would enable Malaysia to undertake extensive forest restoration and conservation projects without being fully reliant on government funding.

Beyond FCC, Malaysia, through MFF, is also in the final stages of developing a national standard for Forest Carbon Offset (FCO), which is expected to be completed by the end of the year, with full implementation planned for next year. This initiative positions Malaysia as a leader in carbon-based forest conservation, providing a structured framework for international investors to support naturebased climate mitigation strategies.

ESG Xchange 2025 serves as a key global platform for policymakers, corporate leaders, investors, and sustainability experts to discuss ESG standards, financing, and strategic collaboration.

The conference plays a critical role in shaping the future of ESG, fostering international cooperation, and accelerating the transition toward a more sustainable global economy.

-- BERNAMA