Management Consulting

PETRONAS, a global energy provider, is navigating the complexities of the energy transition towards net zero emissions by addressing specific risks associated with this transformation. The company faces the challenge of balancing the need for a secure energy supply with the imperative to reduce emissions. As countries enhance their commitments to net zero targets, PETRONAS is innovating to ensure that energy security is not compromised while transitioning to renewable energy sources. One of the key issues PETRONAS confronts is the risk of greenwashing, which can lead to reputational damage. To mitigate this, the company emphasizes transparency in its commitments and progress towards the energy transition. Norliwati Abdul Wahab, the Group Chief Risk Officer, highlights the importance of providing accurate, audited data that complies with greenwashing guidelines to manage stakeholder expectations effectively. Financially, PETRONAS is disciplined in allocating a significant portion of its internal capital to fund new renewable energy ventures while still supporting its core oil and gas business. This strategic allocation not only demonstrates credibility to stakeholders and lenders but also ensures that the company can meet its net zero targets by 2050. The need for substantial upfront investment in new technologies, such as carbon capture and storage, introduces additional risks, including regulatory uncertainties and public acceptance challenges. PETRONAS recognizes the importance of collaboration with various stakeholders, including governments and insurers, to navigate these complexities and secure the necessary risk transfer solutions. Through these tailored strategies, PETRONAS aims to sustain its business growth while contributing to a cleaner energy future, showcasing a proactive approach to managing the multifaceted risks of the energy transition.