Malaysia has retained its 4th position in the CLSA Limited (CLSA) Asian Corporate Governance Association (ACGA) Corporate Governance Watch 2014 Report and obtained higher scores improving from 55 to 58 points, closing the gap with the top scorer.
Malaysia was commended by the Asian Corporate Governance Association as the only market that has consistently improved its scores. This was achieved through a mix of reforms in the Corporate Governance Blueprint, improving enforcement and requiring domestic investors to take corporate governance seriously as well as through the creation of the Audit Oversight Board.
Dato’ Tajuddin Atan, Chief Executive Officer of Bursa Malaysia, said, “I’m pleased with this outcome. It is an achievement for Malaysia that will reinforce investor confidence and help to inspire a stronger culture of corporate governance. By providing the right environment and the right stimuli, Bursa Malaysia is committed to playing its part in elevating corporate governance in the country.”
Bursa Malaysia was commended for its key role in driving better Corporate Governance culture in Malaysia through its advocacy programmes for Public Listed Companies (PLCs) and its efforts in developing infrastructure with service providers for PLCs to carry out poll voting.
The Report acknowledged that Bursa Malaysia's Listing Requirements have enhanced corporate governance in areas such as mandatory poll voting for related party transactions, limiting the number of directorships to five, mandating nomination committees and enhancing the disclosure of director training. The timeframe for the issuance of annual reports has also been shortened gradually under the Listing Requirements, from six months to five months and eventually to four months.
The Report also acknowledged that enforcement in Malaysia has improved as there has been successful prosecution of cases and issuance of public and private reprimands against PLCs and directors. In terms of disclosure of enforcement activity, the report noted that SC and Bursa's website were well designed and provided easy and logical access to enforcement information compared to the websites of other markets in the region. Bursa’s website was also rated well for the clarity on rules and regulations, and was one of the few in the region offering company announcements going back more than 10 years.
In addition, Malaysia was commended for improvements in financial reporting, the quality of corporate communication, good disclosure of director remuneration, voluntary voting by poll and substantial efforts to launch the Malaysian Code for Institutional Investors.
The Report is produced by CLSA in collaboration with the ACGA, an independent, non-pro