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The Securities Commission Malaysia (SC) today welcomed the findings of the Corporate Governance Watch 2018 report, where Malaysia emerged as the biggest gainer moving from seventh place in 2016 to fourth this year, after Australia, Hong Kong and Singapore. The report is the result of a biennial survey by the Asian Corporate Governance Association (ACGA) and CLSA of 12 Asian countries including Australia.
“We are encouraged by the recognition of Malaysia’s initiatives to improve corporate governance, which is a result of the collective effort by the various stakeholders. Corporate governance will remain a central theme and priority of the SC’s regulatory agenda, to ensure that Malaysia’s capital market continues to be recognised for standards of integrity and good conduct,” said the SC’s Chairman Datuk Syed Zaid Albar.
Malaysia scored above the regional average in several areas, including the strength of its rules for corporate disclosure and governance, as well as enforcement. Malaysia’s score was also the highest (tied with Australia) for quality of auditors and audit regulators compared to other markets.
The report recognised that regulators have taken consistent efforts in promoting company and corporate governance reforms. The report acknowledged the use of innovative approaches to improve corporate governance, such as the introduction of the two-tier vote for the reappointment of independent directors who have served for 12 years or more through the Malaysian Code on Corporate Governance (MCCG). The report also highlights a ‘stronger enforcement culture’ seen in the rising number of charges by the SC, especially those relating to insider trading. The SC’s Audit Oversight Board was also commended as one of the region’s most effective audit regulator.
The report also highlighted the use of technology to enhance monitoring of corporate-governance practices, which refers to the SC’s use of data analytics to monitor adoption of the MCCG by public-listed companies. The SC expects to share its findings through the publication of a thematic report in early 2019.
