[4] Despite challenges in navigating Malay customs and traditions, McArthur's efforts, combined with the proactiveness of Sultan Omar Ali Saifuddien III, led to significant improvements and prevented further annexations of Brunei's lands.

Sultan Hashim Jalilul Alam Aqamaddin's diplomatic efforts caused quite a stir since they irritated the British government, which felt that Brunei had been treated with a lack of responsibility.

[4] In light of these circumstances, McArthur was dispatched to Brunei in April 1904 as part of a special assignment with the Foreign Office, and to make recommendations about the structure of the administration for the "dying sultanate".

[8] In order to get knowledge on commerce, the state of the tribal population, and the political landscape, McArthur spent six months in Brunei researching the archives, visiting the nobility, and exploring the neighbouring regions.

In January 1906, McArthur, the main negotiator in the 1905 discussions with the sultan, was named Brunei's first British Resident and tasked with the rapid creation of a contemporary civil service and restructuring the state's income structure following Western models.

The 1906 Agreement ensured the monarchy's survival by guaranteeing its hereditary continuation, a matter of concern for Sultan Hashim, who sought reassurance from McArthur that the British had no intention of undermining the throne.

His project attempted to solve issues with sanitation,[17] which were most noticeable in Kampong Ayer, the water village where 8,000–10,000 people lived at the time the Residential system was implemented.

Even though Kampong Ayer still had the sultan's palace, McArthur concentrated on establishing a colony on land,[17] beginning with his own resident's office (Bubungan Dua Belas).

His goals, however, were not fulfilled as only a small number of Chinese settlers relocated in 1910, despite a severe threat from McArthur that the government would be compelled to impose penalties if the residents did not leave by the end of 1911.

[1][19] The people of Brunei views McArthur's report as having considerably greater value since, without his prompt action and the outcome of his work, their now-prosperous nation would barely have survived.