SC to review 6 recommendations by ICMR

KUALA LUMPUR: The Securities Commission (SC) is reviewing recommendations proposed by the Institute for Capital Market Research (ICMR) to spur growth and drive greater synergies in the local venture capital industry.

In a statement yesterday, the SC said the recommendations were based on an in-depth study by ICMR, which was commissioned by the SC as part of its efforts to facilitate the intermediation of risk capital.

The proposal is also aimed at enhancing access to financing for start-ups and early stage companies in the capital market.

The independent report by ICMR highlighted the need for targeted government interventions to catalyse greater private sector participation, more integrated cooperation among the venture capital ecosystem stakeholders and adoption of a global mindset.

The ICMR report made eight interconnected recommendations to be considered in a holistic manner.

They include the restructuring of existing public venture capitalists (VCs) to be more commercially-driven and establishment of a dedicated government agency to bridge the funding gap for nascent and high-growth ventures.

The proposal also calls for the establishment of fund-of-funds with matching elements and appropriate incentive mechanisms, creation of a single platform for market access to help domestic entrepreneurs overcome developmental challenges and expansion of the venture debt sector.

It also seeks to further liberalise venture capital tax incentives, establish a centralised information gateway to assist in research, policy formulation and industry profiling as well as to set up an inter-ministerial council to ensure alignment of objectives across different ministries involved in the venture capital ecosystem.

The SC said it would engage with the relevant industry stakeholders directly as well as through the Malaysian Venture Capital and Private Equity Development Council, which it chairs, on the operationalisation of these recommendations.

In undertaking the study, the ICMR conducted extensive consultations with various industry participants ranging from public and private VCs and entrepreneurs to equity crowdfunding operators and corporates and angel investors.