Aspirations of an AI nation

ARTIFICIAL intelligence (AI) is here to stay, and whether we like it or not, it will significantly shape how we work, live, play, and enjoy our leisure activities.

AI is changing the world the way the Industrial Revolution and the emergence of the Internet pivoted the global economy into a new frontier.

Malaysia recently introduced three important documents: the National AI Action Plan 2026 to 2030 (AI Nation 2030), the Voluntary AI Code of Ethics, and the Boardroom Primer for AI Adoption and Governance.

In this analysis, Institutional Investors Council Malaysia (IICM) focuses on how AI Nation 2030 will impact our members and their mandate, and how the Primer will guide them toward adoption and execution with proper guardrails in place.

AI Nation 2030

The world is undeniably experiencing a phenomenal shift towards adopting technological advancements that are expected to make us more productive across every aspect of life and business. For Malaysia, becoming an AI nation by 2030 means AI will be part of our lives.

As the prime minister said, AI is meant to harness technology to fulfil our purpose, values, and culture, addressing the country’s sluggish wage growth and even issues related to climate change. Malaysia’s AI Nation 2030 blueprint is seen as part of the government’s effort to raise the wage floor. For IICM, these incentives are significant as we move towards an AI nation.

AI is seen as a core driver of Malaysia’s next phase of national development. An AI nation is one in which AI technologies are integrated holistically across socioeconomic development, public administration, and citizens’ daily lives.

This also aligns with the direction embedded in the National Fourth Industrial Revolution Policy and the Malaysia Digital Economy Blueprint, which support advanced technology adoption and a data-driven economy.

The government has emphasised that Malaysia must shape its own AI future through homegrown solutions that reflect national values and deliver meaningful benefits, a challenging task given that AI-led solutions are developed in the United States and elsewhere.

Strategic framework

Any blueprint requires a strategic direction, and the AI Nation 2030 is no different.

The government’s AI Nation framework maps out five foundation enablers – globally competitive human capital, market-driven innovation and adoption, data and compute infrastructure, trust via responsible governance, and sustainable funding and investment.

The five enablers are expected to power sectoral impact engines that will drive purposeful AI adoption and secure social and economic benefits.

With this, the government envisions AI Nation 2030 achieving three key targets: ranking in the top 10 of the Global AI Index, a plus 1.2-percentage-point gross domestic product growth attributable to AI, and the creation of 300,000 AI-related jobs.

Malaysia’s AI Nation 2030 blueprint is a holistic attempt to involve every pillar of society, with the government as the key catalyst. The private sector’s role is to scale, compete globally, and participate in the higher-value segment of the AI economy.

At the same time, the rakyat will gain better access to services, improving quality of life and driving meaningful economic transformation. IICM sees the aspirations as potentially achievable, despite the challenging targets.

The government has identified manufacturing, oil and gas, and power utilities as key sectors where AI adoption can drive large-scale productivity gains.

In contrast, social sectors such as healthcare, education, and agrifood can improve AI’s value for the public at large.

For IICM, these are key sectors where our members play an active role in shaping the future, integrating AI capabilities.

AI governance

The AI Nation 2030 blueprint has also called on boards to be ready to oversee emerging technology risk responsibly. Corporates are now expected to have clear Responsible AI governance practices to ensure AI is deployed safely, ethically, and efficiently.

The target is for 30% of large publicly listed companies to adopt emerging technology governance best practices by 2028, rising to 50% by 2030.

Board-level accountability, oversight, and transparency are expected once the Malaysian Code of Corporate Governance considers emerging technology and AI risk.

To achieve this objective, boards are expected to issue governance statements on AI in their annual reports and enhance board-level expertise to oversee AI and emerging technology risk.

At IICM, we look forward to seeing our members’ investee companies take the blueprint seriously, as this represents a generational shift in how businesses will operate in the future.

AI cannot be implemented at the corporate level without proper oversight and governance. As explained in the Primer, board members do not need deep technical expertise in AI.

Still, they should develop a working grasp of its possibilities, challenges, and the responsibilities it creates.

As stewards of the organisation, directors are entrusted with ensuring that AI adoption aligns with the company’s principles, reflects its strategic direction, and serves its long-term purpose.

This stewardship requires them to safeguard the organisation by maintaining vigilant oversight of the risks, ethical dimensions, and potential liabilities that accompany AI use.

IICM believes the Primer is designed to help Malaysian boards, directors, and senior management exercise informed oversight of AI adoption and governance.

It is not intended to turn board members into technical specialists. Moreover, the Primer outlines the different types of AI capabilities board members should understand.

Board members should recognise that AI does not work on its own or in isolation, but is embedded in a corporation’s ecosystem of processes, enabling companies to process information more efficiently and act on it effectively.

Implementing an AI-ready organisation should be well thought out and involves five key steps.

This includes planning and design, followed by solution pairing. The third step is assessing the organisation’s readiness, the fourth is verifying and validating, and the final step is deploying and monitoring.

Board members must ensure these steps are taken to have an effective AI rollout in any organisation.

Risk

The board’s role is to set direction and boundaries for acceptable risk, approve material AI deployments, and obtain proportionate assurance that governance, controls, and monitoring arrangements are effective.

At the same time, boards should calibrate their risk appetite for AI applications and how they will measure, monitor, and evaluate this risk over time, including its financial and non-financial impact on the organisation.

Companies are also encouraged to adopt or adapt a risk assessment approach proportionate to their size and sector, as no one size fits all in AI risk management.

An AI-ready board

IICM believes board readiness is not about being technical experts in AI adoption. It is about understanding how AI intersects with strategy, risk, ethics, and accountability.

A board that models good governance and challenges its own assumptions sets the tone for responsible adoption across the corporation. Hence, boards should set the tone at the top for the AI journey.

This could be part of the board’s meeting agenda or a standalone topic at any board committee level, within the audit and/or risk management committees.

While the government has set the tone for Malaysia to be an AI nation by 2030, Malaysian large listed companies must heed the call and start the ball rolling to ensure the targets are achievable.