22 September 2021 | By Datuk Syed Zaid Albar, Chairman, Securities Commission Malaysia
by Datuk Syed Zaid Albar
Chairman, Securities Commission Malaysia
at the Business Foresight Forum (BFF) Virtual Conference 2021
“Transformative Innovation Reshaping Business Realities in Extraordinary Times”
on 22 September 2021
YBhg Tan Sri Dr. Munir Majid
YBhg Tan Sri Dr. Jemilah Mahmood
1. It’s a pleasure for me to give this opening address here this morning.
2. One of my favourite stories in the Arabian Tales was Ali Baba and the Forty Thieves. If I say Ali Baba now, I wonder how many of you will think of the fairy tale character or Jack Ma and his e-commerce phenomenon.
3. Similarly, how many would remember that “Tesla” is a standard unit of magnetic flux density and “Google” was not even a word. Today, the word Tesla immediately conjures an image of a car and Google has become a noun in the Oxford Dictionary.
4. All these three companies Alibaba, Tesla and Google are a testament to the genius of man and our capacity to innovate, to imagine and to create. These companies are among today’s leading corporations.
5. Perhaps unknown 20 years ago, these companies are more valuable than Coca Cola, Ford and GE, the giants of the last century. But who is to say that 20 years from now, they will not be displaced by companies in new growth areas – companies that we have not yet begun to imagine.
6. Such is the speed of change in today’s landscape that as we look ahead to the post-pandemic future, none of us can predict the answer to this question: ‘What is the shape of things to come?’
7. To find an answer, we must first understand emerging forces and their potential impact. Some may be transitionary in nature. Others will become permanent and even intensify.
8. Tomorrow’s successful companies will be the ones that are well prepared to mitigate risks, and are ready to identify and seize emerging opportunities. In fact, because of the COVID-19 pandemic, all of us can fully grasp the importance of innovation and agility.
9. Allow me to share some emerging trends that will “Reshape business realities in these extraordinary times”.
10. The first is aligned with the theme of this year’s forum. Amid the disruption caused by the pandemic, the world is seeing greater technological innovation.
11. The mainstreaming of technologies like 5G, cloud computing, and AI is reshaping capital markets and their infrastructure. It has shaped new investor behaviour, transforming how issuers fundraise, thus redefining intermediation.
12. Without a doubt, such technological advancements and innovations will not stop. And we can be sure that technology and digital innovation will continue to redefine the future corporate landscape as well.
13. Climate action is another major trend that must not be treated lightly. Like COVID-19, environmental disasters have no borders and represent an existential threat to us all. The United Nations’ Intergovernmental Panel on Climate Change report issued last month, was described as “a code red for humanity”1.
14. This report, coupled with visible and ongoing climate catastrophes across the world, will ensure that the climate remains on the global and domestic agenda for the foreseeable future.
15. It has also become increasingly apparent that inaction is not an option and will only undermine past developmental gains, putting our future economic prosperity at risk.
16. The third related trend is the rise of the stakeholder economy and its emphasis on long-term value creation – one where businesses assume greater responsibility beyond short-term profits – accounting for the needs of a broader group of stakeholders.
17. As governments struggle to cope with the rising cost of social security and ageing populations, more responsibility is being placed on the business community, who are increasingly regarded as corporate citizens, full-fledged participants in society.
18. The pandemic has further deepened existing societal strains, especially among vulnerable groups, adding to already heavy burdens.
19. These fault lines must be addressed to enable communities and social systems to get back on their feet. And business must play their role in society.
20. Finally, shifts in the geopolitical environment are affecting economic and trade relationships.
21. The changing nature of cooperation, competition and tension between the largest economies in the world is not just a near-term risk. It will have long-lasting implications for global value chains as well as technology and data governance standards.
Ladies and Gentlemen,
22. To my mind, against this backdrop, the COVID-19 pandemic taught us a lot. For instance, we learnt resilience, fighting an invisible enemy. We were forced to think on our feet and become agile almost overnight. We had to reimagine how we work. We adopted change and adapted to the new normal because of the pandemic.
23. However, the pandemic is not behind us yet. This means the road ahead could still be bumpy. In this persisting state of flux and change, we must continue to closely monitor emerging and future trends. The challenge lies not in predicting the future but in dealing with the unpredictable.
24. A PwC Global Crisis Survey2 revealed that less than 50% of Malaysian respondents were well-prepared for the pandemic. And therein lies the question: 18 months after the onset of the pandemic, are Malaysian corporates better prepared for future crises? Are they able to future proof their businesses in the face of great uncertainties?
25. Looking back at the recent past, it is obvious that future proofing a business requires these three main attributes: agility, sustainability and resilience.
26. For example, we have witnessed brick-and-mortar businesses transitioning to “Click and Order”.
27. This knack to reinvent, relearn and transform is crucial for companies to respond to emerging risks and remain relevant in the future.
28. The next value is sustainability. A sustainable business strategy aims to impact the environment and society positively. It will address within its own context, some of the world’s most pressing problems, such as climate change, depletion of natural resources and human rights issues, to name a few.
29. Having sound sustainability practices brings us to the third value of resilience. Since the start of the pandemic, we observe companies with good sustainability practices are more resilient than the broader market.
30. In the face of growing uncertainties, processes must evolve and change. The traditional approach of achieving greater production efficiency is no longer optimal in an environment with radical uncertainty.
31. For example, it is counterintuitive but companies might need to create redundancies within their supply chains to reduce the risks of disruptions. This includes harnessing adaptive technologies that allow processes to be reconfigured easily.
32. Make no mistake. Strengthening these three attributes of agility, sustainability and resilience will not be easy and will not occur overnight. To reshape business reality in extraordinary times, leaders must have maturity and humility. Only then can they embrace change, improve and discover the solutions to take their organisations forward.
Ladies and Gentlemen,
33. Whether you are a startup, an investor, a well-established organisation or an MSME, I hope you find the discussions over the next two days enlightening.
34. Before I conclude, I would like to thank the Securities Industry Development Corporation for their steadfast efforts to promote and champion professional excellence.
35. On that note, I wish you all a productive forum ahead.
1 Statement by the UN Secretary-General António Guterres
2 PwC Survey conducted between 20 August 2020 and 25 January 2021