Malaysia’s company directors not up to scratch

Malaysiakini reports that Minority Shareholder Watchdog Group (MSWG) believes recent corporate governance issues in Malaysia point to the failure and ineffectiveness of the directors in meeting best practice standards and enhancing the governance of companies.

Chief executive officer of Minority Shareholder Watchdog Group (MSWG), Rita Benoy Bushon, was reported to have said that the most discouraging thing was lack of assessment of the performances of directors and chief executive officers.

Bushon was reported to have said this at the session on ‘Board Assessment’ at the Malaysian Institute of Chartered Secretaries and Administrators’conference. She was quoted as saying:

The performance evaluation is essential to gauge the skills of directors, including soft skills which are difficult to measure… The boards of directors need to be responsible to govern, guide and monitor company performance and to deliver value.

She also stated that a recent survey revealed that there were only a few companies in Malaysia which conducted board performance assessments. In some instances, she said, there were also directors who were not able to devote their time and attention to the company as they also held positions in other companies as well.

Bursa Malaysia’s listing requirement requires at least one third of the board members be independent directors.