The Securities Commission Malaysia (SC) today released the Corporate Governance Monitor 2025 (CG Monitor), highlighting continued progress in the adoption of the Malaysian Code on Corporate Governance (MCCG) by public listed companies (PLCs).
The CG Monitor provides data-driven insights to guide targeted interventions and inform policy enhancements ahead of the upcoming MCCG revision. The SC will revise the MCCG, which was last updated in 2021, as planned next year.
Key findings from the CG Monitor include:
1. Strong overall adoption
a. Adoption levels remained positive with 33 out of the 48 best practices recording adoption levels of at least 90% (2024: 30 practices).
b. Board governance showed notable improvements, including a declining trend of board chairmen serving on board committees.
o Currently, 73% of PLCs no longer have their board chairmen sitting on board committees, (2024: 63%), reflecting stronger checks and balances and efforts to mitigate self-review risk.
c. Sustainability-related practices also continued to strengthen, with boards and management formalising oversight and keeping abreast of national reporting expectations.
2. Slower progress observed for practices requiring behavioural shifts
a. While overall adoption remains strong, several practices continue to pose challenges, particularly those requiring shifts in organisational culture and behaviour.
b. Board diversity
o Women now make up 34.1% of directors among the top 100 PLCs and 28.7% across all PLCs.
o However, only 45% of total PLCs have achieved at least 30% women representation on their boards.
c. Executive remuneration disclosure
o Only 5% of PLCs disclose the detailed remuneration of their senior management.
d. Most Step-Up practices1 also recorded low adoption, partly due to the misconception that these practices apply only to large companies.
3. Varying level in quality of disclosures
a. While adoption levels are encouraging, disclosure quality varies. Some PLCs provide comprehensive and decision-useful disclosures. Others show generic disclosures, or weak justifications for departures.
CG Monitor 2025 also highlights the progression of MCCG 2021 adoption, reflecting how practices have evolved since its introduction in 2021.
Beyond adoption levels, the true measure of governance practices lies in how effectively practices are implemented to create long-term value and resilience. Boards must translate these principles into action as they navigate emerging governance frontiers.
SC Chairman Dato’ Mohammad Faiz Azmi said value creation remains the ultimate objective of good corporate governance.
“As companies advance to new frontiers, boards are increasingly expected to embed future-oriented priorities such as digital transformation, AI governance and cybersecurity into their oversight.
“Crucially, technology choices today carry strategic, ethical and accountability implications, requiring boards’ attention that extends well beyond a traditional IT lens,” he said.
Insights from the CG Monitor 2025 will also guide the proposed revisions to the MCCG. The revisions are aimed at strengthening key areas such as board leadership and effectiveness, technology governance, risk oversight and stakeholder engagement.
The SC will also conduct a Market Survey to gather feedback on emerging governance trends and global developments that will impact PLCs. Where further guidance or practical tools are required to support adoption, the SC will ensure these are considered in the upcoming MCCG revision.
For more details and to download the CG Monitor 2025, visit here.
- Step-Up practice is a key feature of the MCCG which support companies in moving towards greater excellence. All listed companies, irrespective of size, are encouraged to adopt these practices, in particular large companies.
