ValueCAP unit inks deal to promote sustainable investing

  • Business
  • Friday, 03 Aug 2018

VCAM chief executive officer Taufiq Iskandar Jamingan said sustainable investing is not only about delivering financial returns, but also pairs profit with purpose.

PETALING JAYA: VCAP Asset Managers Sdn Bhd (VCAM), a wholly-owned subsidiary of ValueCAP Sdn Bhd (ValueCAP), has become a signatory of the Malaysian Code for Institutional Investors (MCII), to promote sustainable and responsible investing.

The code was jointly launched in 2014 by the Minority Shareholders Watch Group (MSWG) and the Securities Commission to strengthen the accountability of institutional investors to their own members and investors.

VCAM chief executive officer Taufiq Iskandar Jamingan said sustainable investing is not only about delivering financial returns, but also pairs profit with purpose.

“In Malaysia, shareholders have traditionally taken a hands off approach to corporate governance and refrained from exercising active control over listed companies.

“Now it’s time for all of us to be responsible owners and be more active, building true value of the companies we invest in,” he said at the signing ceremony on Wednesday.

This initiative demonstrates VCAM’s continued commitment to investment stewardship and reinforces its credentials as a proponent of sustainable investing in the Asean region.

Meanwhile, Institutional Investors Council chairman Datuk Wan Kamaruzaman Wan Ahmad said that to date, there are 20 signatories under the MCII, and having VCAM on board is a welcomed effort to encourage good corporate governance in Malaysia

He pointed out that institutional investors has a strong influence on the Malaysian stock market.

“The new Malaysia is now in transition to become more competitive and progressive. This must start from within the organisation, and then subsequently to the country as a whole,” he said.

The MCII code consists of six principles, which aims to promote effective stewardship by institutional investors such as the disclosure of stewardship policy, monitoring and engagement with investee companies and managing conflict of interest.

It encourages institutional investors to practise corporate disclosure and transparency, leading to sustainable long-term value-creation to shareholders.

The code seeks to ensure that signatories invest in a responsible manner by focusing on key areas such as corporate governance and sustainability of investee companies.

The MCII is strictly voluntary, but institutional investors are encouraged to be signatories of the code.

“We are delighted to have come on board as a signatory to MCII. We believe this will strengthen the impetus of our advocacy with regard to sustainable investing, especially in emphasising strong corporate governance practices in our investee companies through active engagement,” Taufiq said.

He pointed out that in the past years, Malaysian corporates have been gradually investing less of their revenue in research and development (R&D).

In 2017, the top 30 companies in Malaysia spent about 0.02% of their revenue for R&D expenditure.

“While there has been a lot of capital available for businesses, there has been much less of a readiness to deploy capital into competitive strategies based on innovation that consider environmental as well as social issues as sources of opportunities,” he said.

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