Breaking New Horizons: Sustainability in Malaysia
Technology is central to the country’s sustainable development agenda. The commercial center of Malaysia, Kuala Lumpur, launched smart city plan, which includes accelerating digital transformation by focusing on education and advancing cloud computing and artificial intelligence (AI) among other areas. The Malaysian government is also focusing on investment in technology. Budget 2022up to MYR 100 million ($23.7 million) in grants for areas such as smart automation and at least MYR 30 billion ($7 billion) for government-linked companies investing in renewable energy, supply chain upgrades and 5G. infrastructure.
In recent years, Kuala Lumpur has also seen more and more greening opportunities. For example, the city administration hired a smart “urban brainwhich uses Alibaba Cloud computing systems to optimize services such as traffic management and even calculate the best routes for emergency services. International technology and mobility companies such as Microsoft and Korea’s Socar, which are looking at environmental innovation and business opportunities, have also invested and expanded their operations in Kuala Lumpur. At the same time, traditional industries such as energy and electronics are trying to reinvent themselves.
In light of this changing environment, this report explores what global companies in Kuala Lumpur are doing to achieve their ESG goals, the opportunities the location has to offer, and how their local expertise can be applied globally.
The main findings of this report:
Malaysia aims to become a regional leader in decarbonisation. The country’s current master plan, which charts its economic development through 2025, includes numerous programs to increase resilience by increasing renewable energy production capacity, developing green mobility solutions, and building resilient and sustainable cities. This commitment to sustainability arises even as the country continues to generate economic growth from traditionally carbon-intensive industries such as oil and gas exploration, energy production and agriculture. However, while some countries’ reliance on fossil fuels and other traditional industries weighs down on their decarbonisation commitments, Malaysia is leveraging its deep, globally integrated industry clusters and supply chains to develop new, greener business processes and less carbon-intensive manufacturing and logistics processes.
In Greater Kuala Lumpur, there are more and more opportunities for “greening”. for some of the country’s traditional innovation clusters, in particular energy, electronics manufacturing, IT outsourcing and other sectors of the digital economy. Asia’s fast-growing digital economy has also created a unique synergy for native digital companies looking to use Kuala Lumpur as a hub from which they can harness green business opportunities in the region. These include Korean eco-mobility company Socar, which is expanding its person-to-person car sharing model in Southeast Asia from its base in Kuala Lumpur. And Schlumberger, which has one of the seven global Innovation Factori centers in Kuala Lumpur. The center is working to accelerate the adoption of its AI to boost energy transition efforts in East Asia.
Malaysia’s mature stance on sustainable development is creating a culture of monitoring, measurement and ultimately accountability. This can serve as a basis for ESG-focused companies to plan their own path. Such efforts are far from cosmetic, they are necessary for the economic prospects of the market. Global, sustainable firms can both achieve their ESG goals through their operations in Kuala Lumpur and use their Malaysian experience as a template for sustainable innovation in their global operations. Malaysia’s role as a global center for sustainable development is critical as its economy uniquely spans many industries, including high technology and energy production, which are critical to shifting global development towards a low-carbon future. Collaboration and communication are essential to these efforts.
This content was prepared by Insights, the user-generated content division of MIT Technology Review. This was not written by the editors of the MIT Technology Review.