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Opening Address at the SIDC Business Foresight Forum 2023 - “Convergence of Transformative Innovation with Revolutionary Impact"
Speaker: Dato’ Seri Dr. Awang Adek Hussin, Chairman, Securities Commission Malaysia
Theme:  Convergence of Transformative Innovation with Revolutionary Impact
Location: Securities Commission Malaysia
Delivered: 13 September 2023
Key Highlight

In his opening address at the SIDC’s BFF2023 Conference, Dato’ Seri Dr. Awang Adek Hussin, Chairman of the Securities Commission Malaysia (SC), highlights the Global Risks Report’s “polycrisis” situation involving supply chain disruptions, global tensions and rising cost of living. Industries must adapt to digital innovation, sustainability and invest in talent to ensure long-term growth.

Here are highlights from his speech:

  1. In the capital market, innovative technologies can serve to reduce market friction, enhance listing and trading process and make investments more accessible and affordable.
  2. Regtech and Suptech tools can be used to manage risks and enhance efficiencies.
  3. The SC’s Guidelines on Technology Risk Management, which will come into effect in the 3rd quarter of 2024 will ensure robust and sound technology risk management practices among market intermediaries.
  4. The ICDM’s Mandatory Accreditation Programme Part II: Leading for Impact includes mandatory sustainability onboarding for PLC directors.
  5. The ISSB Standards, tailored to Malaysia’s context will be issued to embed sustainability in local businesses.
  6. The SC will issue the Maqasid al-Shariah principles by this year to ensure the ICM’s next phase of growth.
  7. To develop talent, collaborations between industry and academic institutions must be established to provide graduates with the required knowledge and skills to be industry ready.


Full Speech:

Assalamualaikum warramatullahi wabarakatuh dan salam sejahtera,

  1. Salam sejahtera dan selamat pagi kepada para peserta Business Foresight Forum 2023.
  2. Pertama sekali, terima kasih kepada pihak SIDC atas jemputan saya untuk menyampaikan ucapan pembukaan. Tema tahun ini, “Convergence of Transformative Innovation with Revolutionary Impact”, amat sesuai memandangkan cabaran-cabaran rumit yang dunia hadapi masa ini.

    3. Addressing Convergence of Challenges and Opportunities

    Ladies and gentlemen,

  3. Concerns about the cost of living, supply chain disruptions, and ongoing tensions between the world’s superpowers, all point to a combination of challenges with a larger aggregate impact. The Global Risks Report from the World Economic Forum this year calls it a “polycrisis” situation.
  4. As the world confronts these multifaceted issues, we must not lose sight of our longer-term goals. In particular, addressing the gaps in sustainable development, social inequalities and climate transition risks.
  5. We must harness the power of convergence, which is the fusion of distinct fields, industries and technology to speed up innovation and growth. This has the potential to transform our lives for the better.

    Innovation and Digital Transformation

  6. There is a saying, “While technology is important, it’s what we do with it that truly matters.”
  7. For example, virtual healthcare, which combines medicine, technology, digital systems, and virtual reality, promises to revolutionise the healthcare sector.
  8. Pecision agriculture, which brings together agriculture, imaging cameras, artificial intelligence, and drones, is another good example of how innovation can enhance food production. In fact, AI-driven development can potentially transform diverse industries and markets, showcasing the impact of groundbreaking change.
  9. As a capital market regulator, we recognize that innovative technology must be embraced to catalyse growth and competitiveness. It can serve to reduce market friction, enhance the listing and trading process, and make investments more accessible and affordable.
  10. This includes collaborating with industry and fintech players to accelerate the adoption of innovative Regulatory Technology (RegTech) and Supervisory Technology (SupTech) tools to manage risks and enhance efficiencies.
  11. Recognising the pivotal role of technology, the SC recently issued the Guidelines on Technology Risk Management. We want to ensure robust and sound technology risk management practices among market intermediaries. This reflects our commitment to technological advancements in a secure and responsible environment. The Guidelines will come into effect in the third quarter of 2024, giving the industry adequate time to align with these requirements.

  12. We also continue to promote innovative financing platforms such as equity crowdfunding (ECF) and peer-to-peer (P2P) financing, which allow businesses and investors to access and provide capital in a more efficient and inclusive way.

  13. Notably, since its start, SC-registered equity ECF and P2P financing platforms have raised over RM4.4 billion for over 7,000 micro, small, and medium-sized enterprises (MSMEs).
  14. This year, through the SCxSC platform, we collaborated with the Ministry of Agriculture and Food Security to foster innovative solutions to boost agriculture development.
  15. By leveraging technology and financial innovation, we want to give farmers and agribusinesses with access to funding, market opportunities and knowledge-sharing platform to create a more resilient and efficient food eco-system in Malaysia.

    Sustainability and the Islamic Capital Market

    Ladies and gentlemen,

  16. In today’s world, sustainability has become a key priority for investors. To attract investment and remain competitive, businesses must incorporate sustainability principles into their operations. This commitment must also be reflected in their supply chains and network of SMEs.
  17. It all starts at the top, with boards and corporate leaders. Not only it is important to get board members to embrace sustainability, but it is also important to equip them with the necessary tools they need to champion it.
  18. The Institute of Corporate Directors Malaysia’s (ICDM) Mandatory Accreditation Programme Part II: Leading for Impact, which includes mandatory sustainability onboarding for public listed company directors, is a right step in this direction.
  19. Next, we want to adopt the International Sustainability Standards Board (ISSB) global standards but tailored to our local context. This will embed sustainability into the DNA of our corporations.
  20. Malaysia is at a juncture in its development of domestic renewable energy sources as well as a carbon market. We cannot afford to fall short of Environmental, Social, and Governance (ESG) standards.
  21. We should make full use of the opportunities that have been provided. In this case, the launch of the centralised sustainability reporting platform for Malaysian firms to disclose their ESG data, by Bursa Malaysia and the London Stock Exchange is a positive move.
  22. Furthermore, the synergies and alignment between Shariah and ESG principles are naturally compatible. Malaysia is indeed, in a unique position to lead in sustainable finance by leveraging on its expertise in the Islamic Capital Market (ICM).
  23. Our regulatory frameworks, such as the Sustainable and Responsible Investment (SRI) Sukuk Framework, SRI-Linked Sukuk Framework, and Waqf-Featured Fund Framework, reflects our commitment to both the sustainability and ICM agendas. Waqf is an innovative solution and social finance catalyst that aligns with this commitment to sustainable practices.
  24. We also intend to issue Maqasid al-Shariah principles by this year to ensure that our ICM's next phase of growth, is more deeply rooted in ethical, socially beneficial, and sustainable practices.

    Possessing the skills to innovate

    Ladies and gentlemen,

  25. While technology has the potential to transform, it cannot replace human creativity and innovation. Having the ability to innovate allows us to harness the power of technology and create solutions to challenges we face today.
  26. Recent domestic investments by Tesla, Infineon, Intel, and AMD Global Services are positive drivers for our economy’s continuing progress. These investments highlight Malaysia’s integration into the global supply chain. It also calls for a market-ready workforce capable of participating in higher value-added activities.
  27. It requires people that are conversant and skilled in new applications and technology such as AI. Employers must prioritise the quality of their workforce by investing in professional certifications and training in crucial areas.
  28. To meet this demand, Malaysia has been actively investing in education and skills development programmes, including the upgrading of technical and vocational education training (TVET).
  29. To be more effective, collaborations between industry and academic institutions must be promoted to bridge the gap between theoretical learning and practical application.
  30. The SC launched the investED programme in June this year in response to the increased need for skilled professionals in the capital market industry. The programme aims to provide graduates with the required knowledge and skills to be industry-ready and excel in various roles within the industry.
  31. Through investED, we are actively promoting collaboration between SIDC, industry players and universities to ensure a steady pipeline of capital market talent for the future, more than compensating for the loss to other industries and markets overseas.
  32. In addition, our affiliate, the Institute of Capital Market Research Malaysia (ICMR), has also set up The Research Collaboration Network with other centres. This initiative will rely on regional networks to expand knowledge and research alliances. It is expected to complement existing initiatives, particularly in terms of deepening skill sets and understanding of the capital market. 

    Closing

    Ladies and gentlemen,

  33. In closing, let me reiterate that the convergence of digital innovation, sustainability and talent is reshaping the way we live, work, and how we plan for the future.
  34. The imperative for industries is crystal clear: adapt or be left behind. Embrace digital innovation as a catalyst for growth. Harness the power of sustainability as a guiding principle, and invest in nurturing talent that will shape our future.
  35. In this transformative landscape, the industries that prosper will be the ones that seize the opportunities presented by this convergence, committing themselves not only to profitability, but also to the well-being of our people, and the preservation of our planet.
  36. So let us consider how we can work together, to build a future where progress knows no bounds.
  37. Thank you, and I wish you all a productive conference.

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