KUALA LUMPUR: Tan Sri Muhyiddin Yassin has told the Companies Commission of Malaysia (CCM) to rejuvenate the national definition of corporate governance that is already more than a decade old.
He said a new paradigm shift must be introduced to corporate governance in line with the 21st century business environment.
It should not only be perceived as a tool to mitigate risks but instead as a strategic mechanism and offensive tool to further the national economy and enhance business operations, the deputy prime minister said.
“It is timely to redefine corporate governance to include flavours of ethical values, honour and leadership,” he said in a speech read out by Domestic Trade, Co-operatives and Consumerism Minister Datuk Seri Ismail Sabri Yaakob at the start of the CCM National Conference 2012 here yesterday.
Present was CCM chief executive officer Mohd Naim Daruwish.
Muhyiddin said a closer look at the Switzerland-based International Institute for Management Development World Competitiveness Yearbook as well as other global indices revealed that apart from key economic and business consideration such as GDP growth, assessments were also made on practices linked to corporate governance.
Among the practices, he said, were corporate ethics, corporate audit and reporting, efficacy of the board of directors, investors' protection, minority shareholders' protection and standard of disclosure.
In the Global Competitiveness Report 2011, Malaysia rose five ranks from 26th to 21st place among 142 countries.
The country also improved to 18th from 23rd place out of 182 economies in the World Bank's Doing Business 2012 and leapfrogged to 50th place from 113th place in the “Starting a Business” indicator.
Muhyiddin said taking the concept down to individual companies, good corporate governance practices would carry excellent business value.
“Companies which practise good corporate governance could be an investor magnet,” he said.
The also had relatively easier access to credit facilities from banks and financial institutions, and good public reputation, he added.
He said employees in these companies would be more motivated, loyal and productive.
“Talented university graduates would want to be part of institutions which carry positive vibes,” he said.
Themed “Managing Corporate Governance. Creating Value. Transforming Economy”, the two-day CCM National Conference is organised through CCM's corporate training arm, Companies Commission of Malaysia Training Academy. - Bernama