In recent weeks, the conversation on sustainability, has accelerated with a focus on climate and energy adaptation for business survival, after periods of stagnation in other markets.
The message was clear from the business community who attended Sustainability Week Asia in Bangkok in March 2026. This was my 3rd year attending the event, and it was the first time I really felt an actual urgency in the conversation. The theme “From idealism to pragmatism” echoed what I have heard from clients, think tanks, and government representatives. With key themes framed around resilience, competitiveness, reliable supply chains, and energy security, there was strong interest in how quickly businesses and governments can sustain growth in an increasingly unsettled world, with a strong call for coordinated action for ASEAN.
From my conversations with clients and observations of the market, three big themes are leaving a lasting impression on my 2026 outlook on sustainability.
1. A fragmented world presents opportunities to inject energy into the renewable energy transition
Current market developments are sharpening the case for reducing dependence on fossil fuels and accelerating the shift to renewable energy. Geopolitical tensions are exposing the vulnerabilities of fossil fuel-dependent economies, prompting countries to look for alternatives now. Malaysia’s state of Sarawak has built their own approach, using hydropower as the base for green hydrogen production and cross-border energy trade. Prospects are bright. Sarawak already exports energy to its neighbours in Borneo such as Brunei, Kalimantan, and Sabah, and they are including Singapore in the list later this year. The potential to further enhance cross ASEAN opportunities for energy transition is evident if the region ramps up its commitment to the ASEAN Energy Taskforce.
There is also a need for a coherent and harmonised approach as the region navigates legacy fossil fuel support mechanisms and works to close the gap between grid investment and rising system demands. An ASEAN power grid would send a powerful signal that the region is serious about energy transition, while addressing challenges around basic connectivity, a strained grid capacity, and rural lack of access to power.
2. Sustainability is driving trust in the carbon market and businesses
In the energy trilemma, the real test is whether sustainability efforts can deliver on these critical imperatives: energy security, independence, and affordability. Trust is a key factor: trust in data, trust in the quality of carbon credits, trust in investor decisions, and trust in a market weighed down by fragmentation. The call for an ASEAN common carbon framework and greater interoperability is also a call for carbon market confidence. Challenging economic times don’t remove growth opportunities—they change where the opportunities are. It’s also opening doors to building more credible regional systems, especially here in Asia and ASEAN.
The steady march towards mandatory IFRS reporting in Asia is also standardising financial disclosures on climate and sustainability-related risks and opportunities, strengthening the comparability and reliability of sustainability reporting among individual businesses. Premiums will increasingly go to businesses that are reliable. Large scale flooding, such as the severe floods Malaysia experienced in 2021, causing RM6.1 billion in losses or 0.4% of Malaysia’s GDP, is prompting businesses to weigh the rising cost of inaction against the often lower cost of proactive adaptation. Airport investments in climate adaptation solutions, including the use of micro-weather data to improve cooling efficiency and electrification of the airside fleet, show how these are also investments in business efficiency that enable airport operations to keep going for longer.
3. Nature is reinforcing climate adaptation and enterprise risk management efforts
Nature-based climate action is gaining traction in the journey to achieve net zero, both for its contribution to high-quality carbon credits, and for its role in supporting climate adaptation through nature-based solutions (NbS) in urban areas. For example, with the current hot spells testing the viability of crisis preparedness in urban centres, NbS is emerging as a viable option for the prevention of heat island effects.
The use of nature indicators as part of enterprise-wide risk management is promising—insurance companies in Malaysia are starting to assess risks like deforestation and land degradation in relation to flood exposure models, using existing TCFD-based tools. There is also an increasing shift in using climate and nature considerations to make decisions on capital allocation, mergers and acquisitions (M&As), and business planning. This signals market maturity, as companies are challenged to move away from a compliance-driven focus to value creation through finance-grade sustainability data, internal carbon pricing, and shadow carbon taxes. They are also prompted to think hard about the potential future costs of climate and nature inaction.
Sustainability, redefined by the realities of business continuity
The fragility of the current macroeconomic landscape may be affecting ESG sentiment, but it’s also making the underlying case for sustainability harder to dismiss. The tone on sustainability is changing, looking less like a principles-led initiative and more of an economic resilience strategy. Stronger regional cooperation in Asia and ASEAN will support energy independence, the development of more credible carbon markets, and the integration of climate and nature considerations into capital allocation and risk management decisions. Indeed, with all that's changing around us, one message will only grow louder in boardrooms and meeting spaces—sustainability is central to business survival.
The content and author information presented are accurate as of the time of publication.
Contact us
