Kyndryl and Microsoft Study: Only 35% of Malaysian Businesses Fully Harness Technology in Their Sustainability Goals, with Data and AI Catalysing Action

Kyndryl, the world’s largest IT infrastructure services provider, released the second Global Sustainability Barometer study, commissioned by Kyndryl and Microsoft. The study, conducted by Ecosystm, shows that while 83% of Malaysian organisations recognise the strategic importance of technology in achieving sustainability goals, only 35% report leveraging it to its fullest potential to inform their overall sustainability strategy.

In Malaysia, 77% of organisations see a strong alignment between sustainability and IT teams. However, IT’s role is often confined to reducing its own environmental impact, leaving opportunities untapped for driving broader sustainability initiatives. Between 2023 and 2024, 45% of organisations reported maintaining or accelerating their sustainability efforts – an encouraging sign of progress, especially in a landscape where 61% place high importance on sustainability. However, stakeholder pressures and shifting priorities have caused some organisations to slow down, emphasising the need for better leadership alignment and a more strategic approach to fully integrate IT into sustainability goals.

“As the world faces increasing climate-related challenges, businesses are under pressure to act decisively and place sustainability at the forefront. This year’s Global Sustainability Barometer study, which also features in-depth analysis of several countries in ASEAN including Malaysia, highlights that organisations must move from intent to collective action to drive change,” said Effendi Azmi Hashim, Country Managing Director, Kyndryl Malaysia and Indonesia. “While challenges persist, there is a growing momentum and opportunity in embedding technology into sustainability strategies to turn abstract goals into actionable, data-driven plans.”

The study shows that leaders in Malaysia are increasingly recognising the benefits of sustainability initiatives for their organisations, though gaps remain in maturity, adoption and execution. Key insights reveal the following:

• Sustainability strategies differ significantly across organisations. While 57% report that sustainability is operationally embedded but not fully measured, only 13% have adopted data-driven approaches. A mere 4% view sustainability as a strategic asset, leveraging data for planning and decision-making. Regulatory compliance emerged as the primary driver for sustainability efforts, followed by customer demands and pressure from shareholders and investors.
• The top barriers to adopting sustainability practices include difficulties in reporting or demonstrating progress, lack of organisational or leadership buy-in, and high costs. Supporting sustainability data needs remains a hurdle, with 45% identifying the collection of external data as their biggest challenge.
• Although 92% of organisations collect sustainability-related data to varying degrees, only 20% utilise it effectively to track, analyze, and optimise performance. Interestingly, 24% use data to guide their broader transformation journey, highlighting untapped potential in data-driven strategies.
• While 60% of organisations use AI or automation to enhance efficiency, reduce environmental impact, and build sustainable operations, 68% do not consider the environmental footprint of AI itself. Moreover, 56% believe AI increases the cost of sustainability initiatives, underscoring the need for a more balanced approach to integrating technology.

Matthew Sekol, a Sustainability Global Black Belt at Microsoft, added, “Companies can gain the insights needed to deliver on their commitments and drive resilience by integrating sustainability data with operational and financial data, and using traditional data analytics and robust AI tooling to reshape operational efficiencies and foster sustainable innovations.”

Taking action to advance sustainability strategies

Malaysia, like other ASEAN markets surveyed, demonstrates encouraging progress in sustainability, yet notable differences in maturity and pace remain across the region. Singapore continues to lead with advanced technology adoption and data-driven sustainability initiatives. In contrast, Malaysia shows significant potential to further integrate technology and improve data accessibility, both key to accelerating its sustainability journey.

To fully realise an organisation’s potential, consider the following guiding principles:

• Place technology at the core of strategic planning. Companies should consider integrating technology into sustainability strategies to turn abstract goals into actionable plans. Data integration, measurement, and reporting tools can align sustainability objectives with core business priorities.
• Recast the role of AI. Integrating AI-powered scenario planning and climate risk mitigation allows organisations to adopt a holistic approach to environmental responsibility, enhancing readiness for future challenges.
• Respond to stakeholder demands for Sustainability. Business leaders should recognise that many stakeholders, including supply chain partners, government, and regulators, are actively advocating for sustainability policies.
• Foster a culture of collective responsibility. Legal, risk, corporate affairs and dedicated ESG teams are often leading sustainability initiatives in Malaysia. The next step is for organisations to fully engage cross-functional teams, particularly the C-level executives, finance and technology, to move sustainability into a core business priority and ensure implementation.

Kyndryl and Microsoft provide actionable strategies for organisations to measure infrastructure baseline emissions and optimise AI architectures, including AI and machine learning models to minimise energy use and reduce waste. The two companies work closely with organisations to ensure that technological advancements contribute positively to sustainability goals without compromising innovation.

“We see an increasing number of ASEAN organisations, particularly large corporations and conglomerates, making sustainability a strategic priority,” said Ullrich Loeffler, CEO & Co-Founder of Ecosystm. “AI can be a game-changer in these efforts, helping businesses optimise resource use, minimise waste, and enhance environmental impact. As AI adoption matures, its influence will ripple across the ASEAN market, fostering collaboration and driving a more sustainable and equitable future for generations ahead.”