PN17, companies from China to come under MSWG surveillance

KUALA LUMPUR: Practice Note 17( P N 17) firms and Bursa Malaysia listed companies from China will come under the surveillance of the Minority Shareholders Watch Group (MSWG) next year in a move to look after the interest of minority shareholders.

MSWG chief executive officer Devaneson Evanson said the watch group can have a greater impact by addressing companies whose shareholders were at higher risk.

To-date, MSWG is actively monitoring 300 listed firms.

“We are going to cover all because once you become a PN17 company, you are already a risk while listed China companies have a history of accounting frauds and problems,” he told reporters after the launch of Malaysia-ASEAN Corporate Governance Report 2017 yesterday.

Devaneson said MSWG would start monitoring the companies by June next year as most listed companies that have their financial year end in December 2018

We are going to cover all because once you become a PN17 company, you are already a risk while listed China companies have a history of accounting frauds and problems. Devaneson Evanson, MSWG chief executive officer

would hold their annual general meetings in that month.

Asked on improvements needed in strengthening the corporate governance (CG), he emphasised on gender diversity in the boardroom, as well as, performancebased remuneration.

“At MSWG, we always discourage political appointees from sitting on boards. Let the shareholders’ elect their directors,” said Devaneson.

Meanwhile, the newly released corporate governance report revealed that a five-year trend of the Top 100 public-listed companies (PLCs)’s average score had consistently moved upwards from 75.99 points in 2013 to 85.02 points in 2016 and rose further to 86.18 points in 2017.

The uptrend momentum portrayed the consistent and greater efforts by Top 100 PLCs in improving their corporate governance practices, policies and disclosures, as well as, MSWG’s strong advocacy efforts for companies to embrace corporate governance.

The leading sectors where sectorial corporate governance score was higher than the overall CG score of 62.20 points include finance at 78.94 points, infrastructure project PLCs (67.24 points) and trading/services (64.40 points).

The report also said between 2016 and 2017, there has been an increase in the average remuneration for executive directors and non-executive directors due to greater responsibilities and challenges, as well as, market expectations which come with board positions. — Bernama