Corporate Climate Resilience Innovation Among Malaysian Energy Firms: Evidence From CCRASI

Abstract

Climate change is forcing organisations to innovate their governance structures, risk management practices, and strategic decision-making processes to address the growing physical and transition risks associated with a changing climate. Within the energy sector, corporate climate resilience has emerged as an organisational innovation capability that enhances long-term competitiveness, strengthens responsible business practices, and creates sustainable value. Despite increasing regulatory expectations and sustainability reporting requirements, empirical evidence on how firms in emerging economies develop and embed climate resilience remains limited. This study assesses the level and evolution of corporate climate resilience among Malaysian energy firms using the Climate Change Risk and Adaptation Strategies Index (CCRASI), a multidimensional framework comprising 64 indicators across four dimensions, (i) climate risk assessment, (ii) adaptation strategies, (iii) carbon risk management, and (iv) governance and stakeholder engagement. Using content analysis, the annual and sustainability reports of 28 publicly listed Malaysian energy firms covering the period 2019-2024 were analysed. The results indicate a moderate level of corporate climate resilience, with an average score of 44.85%. However, resilience performance improved substantially during the study period, increasing from 25.06% in 2019 to 68.86% in 2024, representing an overall improvement of approximately 175%. Governance and stakeholder engagement recorded the highest score (59.55%), reflecting stronger board oversight, climate governance, stakeholder engagement and organisational accountability. In contrast, climate risk assessment recorded the lowest score (36.88%), indicating limited adoption of advanced practices such as quantitative climate risk assessment, climate scenario analysis, stress testing, and financial impact analysis. Carbon risk management and adaptation strategies also recorded moderate scores, suggesting that firms have made steady progress in strengthening carbon reduction initiatives and operational adaptation measures. This study contributes to the innovation and entrepreneurship literature by positioning corporate climate resilience as a strategic organisational innovation capability that strengthens organisational adaptive capacity, supports responsible business practices, and promotes sustainable value creation. It also demonstrates the applicability of the CCRASI as a practical assessment framework for evaluating organisational resilience and supporting continuous improvement. The findings provide practical guidance for business leaders and policymakers seeking to strengthen climate governance, improve organisational resilience, and accelerate the transition towards a competitive, low-carbon economy.