SC: Small firms encouraged to adopt MCCG
KUALA LUMPUR: Besides listed companies, Securities Commission Malaysia (SC) also encourages smaller, unlisted firms to adopt the Malaysian Code on Corporate Governance (MCCG), a set of best practices to strengthen corporate culture anchored on accountability and transparency.
“We are always trying to encourage small unlisted companies to think about adopting these best practices,” Securities Industry Development Corporation’s (SIDC) director of Prosfessional Development Salleh Hassan told reporters after its roadshow on the MCCG held at Pullman Hotel, Kuching yesterday. Salleh noted that studies have shown an increasing level of adoption for MCCG.
In terms of compliance, Salleh said that, “Quoting either Bursa Malaysia or Minority Shareholder Watchdog Group (MSWG) studies, the average that we have seen – if you calculate the CG score from zero to 100 – the average now is in the high 60s, and that has been increasing over the years.
I think this is a positive development except that we need to do more in terms of encouraging other companies to adopt it.”
The latest revision of the MCCG, which was released on April 26, 2017, places greater emphasis on the internalisation of corporate governance culture, not just among listed companies, but also encourages non-listed entities including state-owned enterprises, small and medium enterprises (SMEs) and licensed intermediaries to embrace the code.
The new code entails 36 practices with focus on three principles namely: board leadership and effectiveness; audit, risk management and internal controls; and corporate reporting and relationship with stakeholders.