The Business Year

Datuk Mark Rozario

MALAYSIA - Economy

Time to Think

CEO, Agensi Inovasi Malaysia (AIM)


Datuk Mark Rozario was Group Managing Director of a Malaysian listed property group before stepping down to assume his current role at AIM in 2011. He is in charge of running AIM, a government statutory body chaired by the country’s prime minister, to implement a national innovation strategy. AIM was created to encourage wealth creation through the use of knowledge, technology, and innovation to stimulate and develop the innovation eco-system in Malaysia and lay down the foundations of innovation to inspire and produce a new generation of innovative entrepreneurs. He graduated with a BSc degree in economics from the London School of Economics and is a Fellow of the Institute of Chartered Accountants in England and Wales.

"Our agency is governed by a council of seven ministers, with the Prime Minister as our Chairman."

What is the key mentality change you would like to establish in Malaysia?

Looking at the innovation mentality, our goal is to see how we can help cultivate a thinking culture and equip the next generation with creative and critical thinking skills. We have embarked on three programs since we were established in 2011. The first is called I-Think, which aims to implement innovative learning tools in schools. Furthermore, we have introduced the International Baccalaureate (IB) program in 10 government schools in Malaysia, and eight of these have already received IB certification since the project started two years ago. These are not elite schools; they are a cross section of the country. We are studying how these new teaching and learning methods can influence the school system and ultimately change the mentality of our students. A third program is Genovasi, a design school in Petaling Jaya that has already produced 2,500 graduates since its establishment three years ago. The school targets young working graduates who can follow the Innovation Ambassador Development Program, which was developed to introduce design thinking in the workplace. Cultivating a culture of innovation among our future generation is a long-term objective, and we intend to combine elements of what we learn from I-Think, IB, and Genovasi into innovation programs at our secondary schools. Our agency is governed by a council of seven ministers, with the Prime Minister as our Chairman. Innovation essentially cuts across everything, enabling us to help to move the agenda with all the relevant ministries.

How does Malaysia fit into the global innovation landscape, and why would multinationals choose to have their R&D here?

Multinationals here are supported with various programs, such as CREST for the E&E industry that actively links them with academia and local SMEs, often when looking for joint research models. Other programs we have put in place typically target SMEs, especially to support them with commercialization. We have PlaTCOM Ventures providing end-to-end facilitation for companies to take the important final step to commercialize their findings. Around 100 SMEs have been accepted into the program, of which 10 have achieved commercialization. We have access to global IP databases, and we teach people how to protect their ideas with IP strategy. PlaTCOM also oversees all the IPs in our universities and research institutes. There is large flow of government funding for R&D into these institutions, and we match these IPs with commercialization partners to get the licenses done. Another program that we started is Steinbeis, originally a German organization. It has been successful in providing a platform to link industry directly with subject matter experts. This is particularly useful for SMEs that run into a roadblock during their development trajectory where they need expert advice. Steinbeis uses its extensive network to find the right expertise, and is responsible for the agreement, pricing, and arrangement, making it cost-effective.

What is the potential for biomass and what role can AIM play?

We developed a national biomass strategy to identify opportunities to better utilize our biomass. Typically, palm oil biomass is thrown back into fields as fertilizer or is burnt for fuel—both do not give high returns. We seek to diversify the downstream here and explore creating biofuels, biochemical, and bioplastics. Malaysia is the world’s second-largest producer of palm oil, with more than 18 million tons of crude palm oil, which results in 100 million tons of solid biomass. Whilst mapping out the country, we discovered the biggest opportunities in Sabah and Sarawak and are now working with these states to form steering committees. When these development programs are properly executed, the potential will be great and will create highly skilled jobs. In Sabah, we are launching a project to turn palm kernel cake, one of the biomasses left after you crush palm shells, into bioethanol and high protein animal feed with the use of enzymes. This has the potential to substantially reduce our requirements for imported animal feed, especially for chickens.

You recently combined all innovation funds into one fund to make the process more streamlined. How did this come into practice?

Three years ago, we formed the Investment Committee for Public Funds to align all government agencies and 14 ministries that are involved in funding R&D. In the first year, we discovered that 25% of funding requests were potentially duplicated, as there was a lack of communication between the ministries. Our first objective was to eliminate duplication. Secondly, we wanted to have more accountability for how funds are used, set common goals and KPIs, and organize a proper tracking of the R&D outcomes. We also wanted to have a balance in the funding landscape, not to have too much focus in any one area, and eliminate gaps in the funding landscape. This committee will possibly transition into a research management agency, which will have a broader mandate and manage the research assets in the country, all human capital, labs, and equipment.

How is AIM working toward sustainable, inclusive growth, as expressed in the nation’s Eleventh Malaysia Plan?

We started on social innovation a year ago in a public private partnership format to see how we could support the third sector with all social purpose organizations (SPOs)—ranging from social enterprises to NGOs. We started several programs to discover how social impact can be measured, for which we ultimately developed a social impact measurement toolkit, freely available from our website. We want to change the mindset in social sector, for them to work more efficiently, to measure the impact of their works, and to teach them how to get funded. We are currently working on a social progress assessment to identify the unit costs data for the key social issues in the country that impacts society at large. For this, we identified 40 key social issues over a broad range of topics and determined what the cost to the public sector is for each of those. Then we input data into a social financing model, through which we can discover how we can save government spending by addressing social issues. This is an atypical avenue for CSR activities of the corporate world; however, we believe it has great potential and can change the way the government approaches social issues.

What will be the legacy of your work at the end of AIM’s mandate in 2020?

One of the reasons why we had this 10-year timeframe was to have some level of urgency to move the innovation agenda. We also did not want to become another government agency that would permanently require public funding, as at the end of the day innovation should be primarily driven by the private sector. Many of our programs will continue without AIM, either on their own or with the support of other agencies. Steinbeis was set up as a non-profit foundation and works to be self-sufficient; all fees that are collected cover the operating costs. This model is self-sustaining, does not need government funding, and will be part of the innovation ecosystem. Similarly, PlaTCOM is set up as a company and continues as a private limited company, collecting fees from IP advisory and other consultancy. Genovasi, the design thinking school, has been privatized and will transform into a university, supported by private sector investments.



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