Beyond Returns: Exploring The Determinants of Investors’ Intention to Invest in Environmental Social Governance Stock in Malaysia

ESG investing has grown popular worldwide, and Malaysia has also seen the trend in sustainable investing. However, the decision-making of individual investors in the acquisition of ESG stocks has not garnered adequate research attention. This report aims to identify the major factors affecting Malaysian investors’ inclination toward ESG stocks, which include tacit knowledge, green consciousness, self-interest, self-directness, and institutional credibility. Also, the role of corporate governance is considered in terms of its impact on investment. Studies reveal that investors’ awareness regarding ESG and ethical factors play an essential role, and trust in regulatory frameworks affects the investment intentions towards ESG investment funds. However, self-interest and the lack of standardized ESG reports hinder sustainable investment actions. The relevance of corporate governance practices increases in the reduction of risks and increase of investors’ confidence. In addition, the study calls for increased regulation, better consumer education, and standardized ESG policies to improve the Malaysian sustainable investment markets. In this way, the government, banking systems, and business players can build a sustainable financial environment for investiture. Lastly, this study adds to the existing ESG literature by providing actionable findings for investor actions and actionable suggestions to enhance ESG adoption in the Malaysian financial industry.