Malaysian industries spent RM3.7 billion on environmental protection expenditure in 2022 where it increased from RM2.6 billion in 2015, according to the Department of Statistic Malaysia.
The data show that environmental protection spending by industry players expanded at an average annual growth rate of 5.4% between 2015 and 2022,.
The bulk of environmental protection expenditure in 2022 was directed towards operating expenditure which accounted for 80.6% of total spending. The remaining% was allocated to capital expenditure including investments in pollution control equipment, waste treatment facilities and environmentally friendly technologies.
This spending pattern suggests that much of the cost burden is linked to ongoing compliance and maintenance activities rather than one-off infrastructure investments.
By activity, pollution management dominated environmental protection spending, amounting to RM2.51 billion or 68.1% of total expenditure. This category includes measures to control emissions, effluents and other pollutants generated by industrial processes.
Waste management followed as the second-largest category, with expenditure totalling RM1.06 billion, or 28.8%. Spending on other environmental protection activities, such as biodiversity protection and environmental research, remained relatively small at RM54.6 million, representing 1.5% of total expenditure.
The manufacturing sector continued to account for the largest share of environmental protection expenditure in 2022, with spending reaching RM2.92 billion, or 79.2% of the national total. The sector’s dominance reflects its scale, resource intensity, and higher exposure to environmental regulations.
The services sector recorded environmental protection expenditure of RM413.4 million, contributing 11.2%, while mining and quarrying accounted for RM171.3 million, or 4.6%. Other sectors made up the remaining share.
Selangor, Johor and Pahang Lead by State
At the state level, Selangor recorded the highest environmental protection expenditure, totalling RM995.6 million, or 27.0% of the national figure. The state’s leading position reflects its concentration of manufacturing activities and industrial hubs.
Johor followed closely with expenditure of RM876.0 million representing 23.7% while Pahang ranked third at RM328.8 million, or 8.9 per cent.
The steady rise in environmental protection expenditure over the past decade highlights the increasing importance of sustainability and environmental compliance in Malaysia’s industrial landscape.
As regulatory standards tighten and environmental risks become more prominent, industry players are expected to continue allocating significant resources to pollution control, waste management, and environmental safeguards.
Shahriena Shukri is a journalist covering business and economic news in Malaysia, providing insights on market trends, corporate developments, and financial policies. More about Shahriena Shukri.
