Investment companies in Malaysia commit to living wage
Malaysia’s government-linked investment companies (GLICs) are walking the talk on fair pay, taking a collective step to implement a living wage policy for all their permanent Malaysian staff. This decision marks a turning point in how leading financial institutions are aligning their bottom lines with national wellbeing.
The newly adopted living wage benchmark, set at around 3,100 Malaysian ringgit per month, reflects a substantial uplift from the RM1,700 minimum wage that came into effect on 1 February 2025. The figure was derived from an analysis of industry pay scales and the cost of living, as outlined in the Budget 2024-25 Expenditure Guide.
'Raising the floor' on income security
This wage shift is spearheaded under the GEAR-uP initiative, which is part of the Madani Economy framework championed by the Ministry of Finance.
The initiative aims to “raise the ceiling” on growth potential while “raising the floor” on income security. The phrase is no mere slogan; it captures a policy ambition to generate inclusive growth by bridging the income gap, beginning with key economic institutions.
Finance Minister II, Datuk Seri Amir Hamzah Azizan, set the tone in a joint press release from the GLICs:
Delivering on the vision of the Madani Economy requires a whole-of-nation approach, with the corporate sector playing a vital role.
“The collective move by the GLICs to implement a living wage is an important step to ‘raise the floor’, ensuring that growth is both inclusive and firmly rooted in the well-being of Malaysians,” the official said.
The six GLICs that have adopted or committed to the policy include heavyweights such as:
- Khazanah Nasional Bhd
- Permodalan Nasional Bhd (PNB)
- Employees Provident Fund (EPF)
- Kumpulan Wang Persaraan (KWAP)
- Lembaga Tabung Angkatan Tentera (LTAT)
- Lembaga Tabung Haji
Leading by example on living wage policy adoption
At PNB, the journey towards a living wage began in 2023 when the organisation established its internal framework as part of a broader commitment to social responsibility.
“We are pleased to have delivered our commitment to the living wage initiative. Our focus now is on our key strategic GLCs, for them to firstly adopt the minimum wage policy, and then implement the policy based on the timelines agreed,” said Datuk Abdul Rahman Ahmad, PNB president and group chief executive, as quoted by The Edge Malaysia.
PNB is not resting on its laurels. The organisation has been actively engaging its companies since last year, pushing them to follow suit. To date, three of these companies have already adopted the living wage, with the goal of full implementation across the board by 2026.
Khazanah, Malaysia’s sovereign wealth fund, has echoed this stance. The fund has fully implemented the policy within its own operations and is nudging its core holdings in the same direction.
“Khazanah is committed to leading by example and has fully implemented a living wage within our own operations, while 10 of our core holdings have committed to implementing the living wage,” said managing director Datuk Amirul Feisal Wan Zahir.
For Khazanah, the rationale goes beyond compliance but also serves as a lever to build productivity, business resilience, and long-term national stability.
The EPF, which safeguards the retirement savings of Malaysians, sees this move as a moral imperative as well as an economic one. CEO Ahmad Zulqarnain Onn put it plainly:
Ultimately, improved wages uplift quality of life and translate into stronger retirement savings, ensuring future needs are met with dignity.
Onn said the EPF is also working with its investee companies and partners to drive wider adoption of the policy across its ecosystem.
For KWAP, Malaysia’s largest public sector pension fund, the shift reflects a dual mandate. That is, to secure financial returns while valuing the people behind its success. CEO Datuk Nik Amlizan Mohamed stressed the importance of employee welfare in sustaining long-term value creation.
The LTAT, which manages military pensions, is taking a holistic view. Beyond revising its salary structure, it is reviewing non-salary benefits to ensure comprehensive support for employee welfare. CEO Mohammad Ashraf Md Radzi reinforced the fund’s intent to amplify its efforts through its network of investee companies and associates.
Tabung Haji, meanwhile, is framing its living wage strategy through the lens of Islamic principles. As part of its Stewardship Framework, the organisation links staff investment to the values of Maqasid Shariah and highlights economic dignity as a spiritual obligation.
Recalibrating wage practices
The coordinated action of these GLICs signals a quiet transformation: businesses are no longer treating fair pay as a cost centre but as a catalyst for sustainable growth.
As each institution builds momentum, their ripple effects could well recalibrate wage practices across Malaysia’s broader corporate landscape.