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TITLE: Keynote Address by YB Senator Tengku Datuk Seri Utama Zafrul Tengku Abdul Aziz, Minister of Finance Malaysia at the The MIA International Accountants Conference 2021, Theme: Navigating a Sustainable Future with Agility and Resilience

DATE: 08/06/2021

KEYNOTE ADDRESS BY

YB SENATOR TENGKU DATUK SERI UTAMA ZAFRUL TENGKU ABDUL AZIZ

MINISTER OF FINANCE MALAYSIA

AT

THE MIA INTERNATIONAL ACCOUNTANTS CONFERENCE 2021

"NAVIGATING A SUSTAINABLE FUTURE WITH AGILITY AND RESILIENCE""

8 June 2021

  • Yang Berusaha Dr Veerinderjeet Singh, President, Malaysian Institute of Accountants
  • Yang Berusaha Dr Nurmazilah Dato’ Mahzan, Chief Executive Officer, Malaysian Institute of Accountants
  • Members of the Media
  • Ladies and Gentlemen
  1. It gives me great pleasure to be here this morning. Many thanks to the organisers, the Malaysian Institute of Accountants (MIA) for inviting me today to officiate and deliver the keynote address for the MIA International Accountants Conference 2021. Dr.Veerinderjeet Singh is certainly no stranger to the Ministry of Finance and most recently he was part of the Tax Reform Committee to propose improvements to our tax policy.
  2. The Conference theme of Navigating a Sustainable Future with Agility and Resilience is indeed timely as we navigate a tremendously challenging landscape. Faced with an unprecedented and globally synchronised health, social and economic crises, we are working tirelessly to mitigate the impact of COVID-19 to the most affected, and at the same time charting a new direction for the Malaysian economy. The term used globally, building back better towards a resilient and sustainable economy post-COVID-19 has never been more important as our nation reaches a critical juncture to exit from this challenge.
  3. However, this journey will involve many hurdles. Balancing lives and livelihoods, while minimising any longer-term scarring to our economy is no easy task. Although we have projected economic recovery between 6 to 7.5% this year, we are now faced with new variants of the COVID-19 which are more life threatening and transmissible within the community. The containment measures, or the Full MCO which was recently implemented with stricter SOPs is much needed to reduce the number of cases despite the impact it has to livelihoods.
  4. As such, the Government has taken a proactive step by announcing the PEMERKASA Plus (PEMERKASA+) assistance package to ensure that the vulnerable groups, as well as micro, small and medium enterprises (MSMEs) are protected. Worth RM40 billion with RM5 billion in direct fiscal injection, this package is a continuation of the previous assistance and stimulus packages worth RM340 billion implemented since COVID-19 hit our shores that are still on-going. Moreover, the initiatives within Budget 2021 worth RM322.5 billion will also complement and further reinforce our efforts to ensure that the nation continue on a growth trajectory.

Ladies and Gentlemen

  1. Under an uncertain environment, it is imperative that we work on becoming more agile and competent, to ensure that we are always prepared for any eventualities. This will also build resilience, as we will know what are the next steps required should any events that will affect us materialise. In short, this is what it means to be agile and sustainable.
  2. One of the key thrusts in achieving these is to reimagine and reengineer how we do things. The Government has launched the MyDigital, which is the nation’s digital economy blueprint – envisioning how our country will move towards a more digitally connected economy that is on the Industrial Revolution 4.0 (IR4.0) path.
  3. As an important influencer and advocacy towards informed decisions, accountants also play a key role in driving digitalisation. I would like to take this opportunity to applaud MIA’s continuous efforts in encouraging digital leadership and transformation through its MIA Digital Technology blueprint.
  4. Another area related to this include the adoption of integrated reporting, in line with international frameworks on Integrated Reporting (IR). Being the national trainer appointed by the International Integrated Reporting Council, I understand MIA has been the champion in advocating the adoption of IR. While the momentum of IR among public listed companies is to be lauded, IR is something that should also be considered to tell the story of public sector value creation and to build public trust through increased transparency and accountability.
  5. Of course, MIA’s support and guidance as the Government began implementing financial reporting standards, and gradually shifting to accrual-based accounting, have also been invaluable in enhancing public sector finance. The Government’s embracing of public sector financial management has even been the subject of global comparative case studies, with Malaysia and MIA as role models.

Ladies and Gentlemen

  1. Another focal area is talent development and inculcating ethical culture from the top. This entails the application of best practices on professional standards, as well as frameworks that integrate digital adoption.
  2. On the Government’s end, we have worked continuously to ensure good governance, more efficient and effective public service delivery, as well as curbing leakages, fraud and corruption. So far, the Government has pushed for digitalisation on various ends, including:
    1. modernising the public service delivery and curb corruption, as this will reduce direct contact points between citizens and public officials;
    2. shifting to electronic identification cards and biometric proof of identity for identification of citizens;
    3. expediting direct Government assistance to ensure inclusiveness, accessibility, transparency and accountability. So far direct aids have been done mostly on a cashless basis, where application and payments for Bantuan Prihatin Rakyat and Geran Khas Prihatin are made electronically and online.
  1. In the near future, under MyDigital, the Ministry of Finance will ensure payments for all Government services by 2022 are made on a cashless basis. This will lead to higher transactional security, better coordination, enhanced communication on anticorruption initiatives and greater ease of sharing information. And I am pleased to share that as at the end of last year, 60% of the Government's total collection was through e-payment.
  2. In this area, I am aware of MIA’s efforts to strengthen the competencies of public sector finance functions as well as internal auditors working in operational audits and/or financial audits. This is interwoven with MIA’s emphasis on the profession’s core ethics of integrity, accountability and trust to protect the public interest.
  3. Relevant documents in this area are the two Competency Frameworks released by MIA to improve finance leadership and finance functions and therefore financial governance and ethical behaviour, as well as the MIA Competency Framework that aligns baseline competencies for accountancy professionals in Malaysia with international standards.
  4. Regardless of whether accountants are working in the public or private sector, your code of ethics and competencies mean that you owe a duty of care to the public at large. This is a huge responsibility as all stakeholders rely on the professionalism of this profession to make an informed decision.

Ladies and Gentlemen

  1. In addition to the efforts made by MIA as I mentioned earlier, I would like to thank the Institute and the accountancy profession for your on-going efforts to support business continuity, particularly during these challenging times. This include:
    1. advising companies on cashflow, financial and strategic management;
    2. alerting companies to the various aid and assistance schemes made available from Government’s assistance and economic stimulus packages, as well as providing dedicated COVID-19 resources and communications;
    3. creating awareness on the impact of these assistance and economic stimulus packages on the accountancy profession and business, especially on how they should respond; and
    4. finally, coming up with tools and training that help businesses to be more productive and effective.
  1. On behalf of the Government, we also appreciate MIA’s advocacy on tax governance that focuses on addressing non-compliance and systemic inefficiencies. By broadening the tax base – including taxation of the shadow economy, improve tax compliance and administration matters, this will enhance tax collection which is critical to enable the Government to deliver more assistance during times of crisis, as well as for the nation’s developmental expenditures and longer-term reform agendas.
  2. On sustainability, the Government welcomes MIA’s advocacy on this area, particularly on Malaysia’s commitment to embed environment, social and governance (ESG) principles as well as the UN Sustainable Development Goals (SDGs). The MIA has been advocating that SDG reporting should be included in corporate reporting, and this very valuable as accountants bring unique skills and expertise within the global discourse and engagement on sustainability. Specifically, accountants are uniquely qualified to measure and assign climate impact costs such as carbon and greenhouse gas emissions, to provide independent assurance on sustainability processes and impacts, and to issue reports and communications on these impacts to support decision-makers and influence positive change.
  3. The National Annual Corporate Reporting Awards which MIA co-organises annually with Bursa Malaysia and MICPA is indeed a step in the right direction towards ensuring corporate Malaysia embodies the ESG principles in their operations as the assessment criteria includes Sustainable Reporting in addition to having a stand-alone award for Best Sustainability Reporting.

Ladies and Gentlemen

  1. Overall, these are just a few essential areas in which accountants play tremendously important roles as business advisors and economic frontliners. The Government always welcome MIA’s efforts on all fronts in allowing all stakeholders to make informed decisions.
  2. Before I end, I would again like to thank MIA for inviting me to officiate this event. I understand that this year’s Conference has attracted more than 2,000 delegates, which is commendable given the virtual format.
  3. Nevertheless, lifelong learning is the key to Malaysia’s continuing relevance and sustainability in our efforts towards becoming a highly developed nation. We have great depths of talent, which requires unlocking and nurturing. As such, I urge everybody and all companies to allocate more for your professional and personal learning. And I trust that MIA will continue to deliver these learning programmes that are of great benefit and value to its members.
  4. By familiarising its members and the profession with sustainability issues and developments, MIA will help deliver the requisite professional development and training that will develop relevant and competent accountancy and finance leaders who can in turn contribute to sustainable nation building. Having glanced through the programme, I believe it will be an excellent guide to the key developments and issues commanding attention as we navigate these difficult times.
  5. More importantly, in our quest for development, we have to also ensure that nobody is left behind, especially the vulnerable groups. Access to opportunities and education, which has been compromised by the COVID-19 crisis, must be facilitated to bridge development gaps and fortify our talent pipeline, for authentic sustainability, genuine diversity and equitable nation building for all.
  6. This Conference is a building block that will help accountants and finance professionals acquire the traits of insightful leadership, prescience, empathy, resilience, agility and courage that are needed for Malaysia to emerge from this COVID-19 crisis, faster, better and stronger.
  7. On that note, it gives me great pleasure to officiate this event and I wish you a fruitful conference ahead.

Thank you.